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Articles in Category: financial planning

5 Tips to Prepare Your Heirs for a Successful Wealth Transfer

Plan carefully and communicate clearly for a smoother transition of assets
Monday, 26 July 2021

5 Tips to Prepare Your Heirs for a Successful Wealth Transfer

Regardless of how, when, or what amount of money changes hands through inheritance, the wealth transfer process can bring a host of concerns for both parties - benefactors and beneficiaries. Those passing on their wealth and assets may have specific plans on how the inheritance should be managed, while those on the receiving end likely have their own opinions on the subject.

Wealth transfers come with some common pitfalls, many of which stem from communication failures within the family. Whether the issue is a family member with a sense of entitlement or outdated assumptions about roles related to the inheritance, clear communication plays a critical role in removing those barriers to a successful wealth transfer.

Prepare for Emergencies with a ‘Financial Fire Drill’

Put Your Finances to the Test to Discover Whether You’re Ready for the Unexpected
Monday, 28 June 2021

Prepare for Emergencies with a ‘Financial Fire Drill’

No matter how financially stable you may be, none of us can predict what the future will hold. The COVID-19 pandemic has been an important reminder of this fact because it showed many of us how money difficulties – even a financial emergency – can appear seemingly out of nowhere. To survive any unexpected financial scenarios that come your way, it’s important to have a plan. Once you strategize your financial emergency plan, you can test it by running a “financial fire drill.”

A financial fire drill is something you’ll want to do now rather than later down the road when something happens. Creating a financial emergency plan ahead of time, without the added stress and emotion of an actual event, will be exponentially helpful. The drill will help you clarify your necessary cost of living expenses and how you’ll be able to cover them. If this kind of financial preparedness is important to you, read on to learn how you can run your own financial fire drill.

Proposed Tax Changes that Could Affect High-Income Earners

What the Biden Tax Plan May Mean for You
Wednesday, 26 May 2021

Proposed Tax Changes that Could Affect High-Income Earners

The first year of a new president’s administration usually brings quite a few changes. After first focusing on COVID-19 economic assistance, the Biden administration has begun to talk more about tax policy, introducing both the American Jobs Plan and the American Families Plan. President Biden’s tax proposals are starting points for congressional debate, and they lack details that will be required for final legislation. Still, they provide a window into the administration’s priorities and give us insight into proposed changes. Below, we will review proposals that could impact high-income earners, as well as discuss strategies that may be beneficial for high-net-worth individuals to pursue.

8 Tips for Transitioning Your Family Business to the Next Generation

How to Successfully Pass Down Your Company to Your Heirs
Monday, 26 April 2021

8 Tips for Transitioning Your Family Business to the Next Generation

It’s not just a euphemism that small businesses are the backbone of America. They employ about half of  private-sector workers and create two-thirds of net new jobs, according to the data. What’s more, most of these businesses are family businesses that get passed down through the years, tying generations together through the dedication and hard work it takes to keep a business running.

While family businesses tend to perform better than non-family companies during economic crises, most are still incredibly vulnerable from a financial standpoint. This becomes especially true when owners decide to retire, and it becomes time to hand over the reins to a new generation. The process of passing on a business is complex and challenging, but these tips can help make it a bit more manageable.

How COVID-19 May Impact Your Taxes

Coronavirus Stimulus Laws Passed in 2020 May Lower Your Taxes
Wednesday, 17 March 2021

How COVID-19 May Impact Your Taxes

It’s not an overstatement to say that COVID-19 has impacted nearly every aspect of our lives, so it makes sense to expect that it is also going to leave its mark on our taxes this year, too. In response to the pandemic, the government instituted new laws such as the Coronavirus Aid, Relief, and Economic Security Act (CARES ACT) and the Families First Coronavirus Response ACT (FFCRA), in the hopes of providing citizens with some economic relief in these hard times.

If you took advantage of any of these stimulus programs, then your 2020 individual tax return and/or business tax return may look different this year.

Investing for Kids: How to Get Your Minor Children Started With Investing

Four Steps for Starting Your Kids on Their Investment Journey
Monday, 08 February 2021

Investing for Kids: How to Get Your Minor Children Started With Investing

In many families, kids are granted an allowance or earn money for doing chores, plus they’re likely to amass a bit of savings from birthdays and lost teeth, too. While most start out with a piggy bank and eventually move to a savings account with mom and dad’s help, consider the option of investing for kids. Opening an investment account in their name can be exciting, and it’s a great way to begin teaching them more about personal finance from a young age.

Now, the rules for minors surrounding investing are a bit different than they are for adults, but it’s relatively simple to get your kids started. They may only make a little bit of money, but it’s the education and experience that comes with early investing that is truly beneficial. After all, it’s young adults who begin investing for retirement with their very first paycheck who end up with a tidy nest egg that keeps them set for life.

Investment Strategy and Avoiding Emotional Interference

Plan Ahead to Overcome the Emotional Reactions that can skew prudent Investment Strategy
Wednesday, 13 January 2021

Investment Strategy and Avoiding Emotional Interference

As humans, we are emotional creatures, and our feelings can have a tremendous impact on our behavior. When it comes to investing, this can inhibit our ability to make sound financial judgments. In fact, many poor investment decisions have been made by investors who became too emotional and let their behavioral biases overrun their rational thoughts.

For this reason, it’s crucial to understand how emotion can interfere with your investment success. We all go through life with various ups and downs and hiccups along the way. This can cause fear and uncertainty – both fertile fields for emotional financial decision-making.

Below we will discuss three emotional biases in particular that can wreak havoc on your investment strategy – if you let them.

Why Young Investors Should Choose Roth Over Traditional IRAs

Savings Considerations for Your Early Earning Years
Monday, 21 December 2020

Why Young Investors Should Choose Roth Over Traditional IRAs

When it comes to investing, an earlier start means your retirement savings will have more time to grow and you can take full advantage of the magic of compounding. However, many young investors find it challenging to truly focus on saving for retirement, let alone get choosy about the different savings vehicles like Roth IRAs or Traditional IRAs. After all, life is often full of hectic changes and transitions, both at work and personally. If you’re a young investor, you’re in your early earning years when potential job mobility is high, and you’re probably focused on things like buying a home, getting married, and having children. Even if you do find the time and resources to put a bit away for retirement in the midst of all this, you may not believe it’s enough to require a meaningful tax strategy.

Of course, the opposite is true. It is during those early earning years when the true impact of your savings is strongest. The sooner you begin saving – any amount at all – the better off you’ll be in the future when you become much more focused on building your nest egg for retirement.

RMD Strategies to Reduce Taxes

How Planning Ahead Can Help to Minimize Your Tax Burden in Retirement
Friday, 30 October 2020

RMD Strategies to Reduce Taxes

Are you saving for retirement with a traditional 401(k) or IRA? If so, you’re probably enjoying the fact that these investment vehicles are tax-deferred, meaning you haven’t had to pay any taxes on your contributions yet. That won’t happen until you take withdrawals from your accounts once you retire.

Most people assume this is advantageous because their income tax rate will be lower in retirement than it is while they’re working, and that’s certainly true for some people. So, for these folks, it’s savvy to save tax-deferred and then pay taxes on their savings later when the tax rate will be reduced. This is the ideal scenario.

So, what happens if your retirement tax scenario is… less than ideal? What if you tap into your accumulated wealth when you retire and, combined with Social Security and Required Minimum Distributions from your 401(k) or IRA, you end up in the same or higher tax bracket? Fortunately, there are a few strategies you can use to minimize the impact of your RMDs in order to reduce taxes, and we’ll discuss each of them below. First, though, let’s review RMD basics.

HSA or FSA: Which Flexible Spending Arrangement Should You Choose?

How to Choose the Tax-Advantaged Account That's Right for You
Monday, 28 September 2020

HSA or FSA: Which Flexible Spending Arrangement Should You Choose?

There’s been a lot of buzz in recent years about Health Savings Accounts and Flexible Spending Accounts – HSAs and FSAs respectively. Both are tax-advantaged accounts that let you save for medical costs, and many companies offer them as options in employee benefits packages. There are good reasons to take advantage of both HSAs and FSAs, but there are key details that differentiate them. Since you typically cannot have both, it’s important to determine which is the better option for you.

Doctors: How to Use Debt to Your Advantage

When to Use Leverage as a Means for Growth
Wednesday, 02 September 2020

Doctors: How to Use Debt to Your Advantage

For many people, doctors included, the word “debt” has only negative connotations. After all, most of us took out considerable student loans to finance our educations. However, debt can also be used to your advantage when you leverage it for growth.

Investing for Growth Versus Paying Down Debt

Some doctors are quite comfortable with excessive debt, choosing to invest more of their income in tax-advantaged accounts, while others eschew investing at all in order to throw every available dollar toward erasing their debt. Most doctors, though, fall somewhere in the middle and are constantly asking themselves how to best balance investing in tax-advantaged accounts versus paying down debt.

If you find yourself in this middle ground, here are a few basic recommendations, in order of financial importance:

Tax Planning for Those with High Net Worth

Essential Strategies for High Net Worth Individuals
Tuesday, 07 January 2020

Tax Planning for Those with High Net Worth

Tax planning is an essential task for high net worth individuals, and it requires a carefully developed strategy. Without one, you could easily miss out on tax benefits that could be key to maintaining your net worth in the long-term. Since many tax law changes took effect in 2018 with the passage of the Tax Cuts and Jobs Act, it’s an ideal time to revisit your tax planning strategies and ensure you understand the impact of the changes, as well as the opportunities they may present with regard to tax savings.

Below, we’ll review the most important topics to discuss with your tax professional.

The Explosion of Social Payment Apps Is Changing the Way We Share Money

How Peer-to-Peer Payment Apps Make Transactions Convenient and Easy
Thursday, 12 December 2019

The Explosion of Social Payment Apps Is Changing the Way We Share Money

Worldwide social media usage has been growing steadily since 2014, with 3.2 billion users worldwide in 2019. According to recent statistics from Emarketer, 90 percent of Millennials and 78 percent of Gen Xers use social media daily. Baby Boomers are creeping up in usage rates, as well, with more than 48 percent currently using social media every day. 

As social media usage has risen, so has the popularity of social payment apps. Let’s explore how this technology is changing the landscape of how we payment-share with friends and family. 

Three Compelling Reasons to Continue Working

Why the Benefits of ‘Retirement Work’ Go Far Beyond a Paycheck
Friday, 15 November 2019

Three Compelling Reasons to Continue Working

Have you ever wondered why so many retirees continue working in some fashion in their retirement? You may assume it’s the simple financial incentive, but that isn’t necessarily the case.

Many so-called “retirement workers” have learned through experience that there are more benefits to working than earning a paycheck, which is why so many continue to work in part-time positions or dedicate themselves to volunteer efforts. Work, as it turns out, adds more than just monetary value to your retirement years.

These Five Questions Will Improve Your Relationship with Money

It’s Time to Un-Complicate this Long-Term Relationship
Thursday, 17 October 2019

These Five Questions Will Improve Your Relationship with Money

When it comes to the subject of money, do you practice avoidance? If so, you’re not alone. Money is a complicated subject matter, and your relationship with it will likely change at different stages in your life. We all tend to have residual money memories left over from childhood, that mix with our adult experiences as earners and spenders. The result is often a convoluted mess that leaves many people baffled and anxious about money topics in general.

So, how do you “get right” with your money relationship and begin making smarter financial decisions for yourself? Believe it or not, it’s as easy as answering the following five questions:

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