Minimizing Financial Risks

Knowledge is priceless

Financial RisksIf you work with a financial advisor, a CPA, and an estate attorney, then your finances and assets are being looked after; right? It’s their responsibility to know everything to protect your money and reduce financial risks; right?

You hired these professionals to consult with you on the best strategies to grow, manage, and protect your assets. This makes you their ‘boss.’ Just like running a business, you need to know what your management team is doing. Regular meetings and frequent communicate keeps everyone up-to-date and refines the processes to protect your interests to achieve your financial goals and retirement funds.

Risks to your IRA

Planning and managing your IRA is essentially about maximizing the opportunities of reaching your financial goals and reducing the risks that can be a life-changer. Risks can appear in all shapes and sizes such as job loss, costly health crises, an unexpected death, and even living longer than expected.

Here are ways to reduce your risks.

Portfolio Threats – Help offset market and economic risks to your IRA portfolio through proper asset allocation, diversification and hedging.

Job Threats – Many people experienced job loss during the last recession. IRA funds are often needed to cover living expenses. Help offset costs and withdrawing from your IRA by setting aside enough emergency cash to cover expenses until employment is secured. There are financial consequences to withdrawing from an IRA if you have not reached the age of 59 ½.

Health Threats – By having health care disability and long-term care insurance in place, you can dramatically reduce your risk of having to use your IRA assets.

Legacy Threats – Offset the risk that your death will leave your family without adequate income or that your heirs will not inherit what you intended by planning with sufficient life insurance.

Tax Threats – The risk that your estate will owe more than necessary when you die in estate and income taxes is offset through strategic estate and tax planning.

As you can see, there are a lot of factors to consider as you determine your long-term financial goals. What are the best ways to achieve your financial goals, manage your assets, and how to protect them? You owe it to yourself and your loved ones to seek the advice of financial experts. Remember; just keep your finger on the pulse and keep communication lines open for regular reviews of your accounts.

How Much Do You Need to Save for Retirement?

Save for RetirementTips on financially preparing for your retirement

How much you need to save for retirement depends on your estimated yearly living expenses once you stop working full-time. Here are tips on how to estimate future financial needs.

  • Gather a month’s worth of bills, ATM slips, and credit card receipts. Total the amounts omitting expenses that you don’t anticipate having after retirement such as college tuitions, mortgage payments, credit card debt, disability insurance premiums, etc.

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2016 Tax Planning for Investment Income

What Will Be Considered Investment Income?

Investment IncomeInvestment Income

  • Interest, Dividends, Capital Gains (long and short) including the gain on the sale of investment real estate and second homes)
  • Annuities (but not annuities in IRAs or company plans)
  • Royalty Income
  • Passive Rental Income and Other Passive Activity Income
  • Above items from a child’s tax return that are reported on a parent’s return (the “Kiddie Tax”)

NOT Investment Income

  • Wages and Self-Employment Income
  • Active Trade or Business Income (including interest, dividends capital gains)
  • Distributions from IRAs, Roth IRAs, and Company Plans
  • Including Net Unrealized Appreciation
  • Excluded Gain from the Sale of a Principal Residence
  • Municipal Bond Interest
  • Proceeds of Life Insurance Policies
  • Social Security and Veterans’ Benefits
  • Gains on the Sale of an Active Interest in a Partnership or S Corporation
  • Taxable income from items that are NOT investment income can push taxpayers over the income threshold and cause investment income to be subject to the 3.8% surtax.

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Wealth advisory value proposition

Advising on the client’s best interest

Scott Smith, CIMA®
One of the rewarding aspects of being an advisor is getting the opportunity to partner with clients and help them make good financial decisions throughout the various stages of their lives. Perhaps more than most other professions, our business is personal because it concentrates on the unique goals and challenges of each client and creates a long-term plan that brings them closer to their destination. The Wealth advisory value proposition we bring to the table as a fiduciary is directly correlated to the depth and breadth of each client relationship.

“…being a client’s trusted confidant in all respects where money and life intersect is a great responsibility we assume with diligence and care.”

Advisory Value Proposition

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