What Do The Sun, The News & Retirement Planning Have In Common? – Finger Financial Five #5

“Worry is like a rocking chair.  There is a lot of movement, but you don’t go anywhere.” -anonymous

“We have no idea what the future might bring, and even if we did, we would not be able to anticipate what the market will do in response to those circumstances.” -Barry Ritholtz

Only 1 to 2 percent of the sun’s energy is captured by plants. The rest is just reflected as heat[1]. The same goes for useful information. We are bombarded by noise, news, and other types of drama. Only 1 to 2 percent of this information is useful, in my opinion. Read on to get your weekly dose of the good stuff 😊.

For the political worry warts out there…

Now is the time to start year end tax planning. Here are 5 things to consider:

  1. Take a look at your realized capital gains this year.  This mean how much profit you sold for 2020, which could be taxable.  You may be able to take some losses, if you have them, before the end of the year to reduce these taxable gains.
  2.  Consider Roth conversions- if you are in a lower tax bracket for 2020, you can convert a portion of your traditional IRA to a ROTH.  You pay the taxes now, presumably at lower rate, so you take future withdrawals out tax free.
  3.  529 plan contributions- these are educational plans, that may provide state tax deductions and tax free withdrawals for educational expenses.  Make your contributions before year end, to count for 2020.  By the way, 529 can now be used for K-12 private school!
  4. “Bunch” your charitable contributions- if you are charitably inclined, you may want to combine several year’s worth of contributions in one year.  Many people’s yearly contribution may be too low to be very beneficial tax wise.  Bunching the contributions, may push you over that threshold.  How to do that?  A Donor Advised Fund.  You contribute all the money, or low cost basis stock, into the fund, this year, and use the DAF to send money to your charity in subsequent years.
  5. Review retirement plans- business owners, may want to look at their plan to make sure it satisfies their company’s needs for 2021.  Employees may want to adjust their 401k contributions before year end to get to their maximum allowable and/or increase their savings for next year.

Naturally, talk to your tax advisor to see what is best for you. Just over the past week, I have had 5 to 8 conversations with my client’s CPAs. We work together to help you meet your financial goals. Call or email me with any questions.

Finger Financial Five – 5 points in 5 minutes or less – is to provide you with a weekly shot of useful financial information. My intention is to share principles, so that you will have more clarity and peace, that help you make better financial decisions.

Hope all is well with you and your family,

Jeremy Finger, CFP®, CIMA®, CRPC®, CPFA
Founder & CEO
Wealth Management Advisor

P.S. On the lighter side, my wife did a wonderful job decorating the new office. Stop by sometime.

Book 15 Minute Phone Appointment – CLICK HERE

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Myrtle Beach, SC 29577

Investment advice offered through Stratos Wealth Advisors, LLC, a registered investment advisor; DBA Riverbend Wealth Management.

This content is developed from sources believed to be providing accurate information and provided by Riverbend Wealth Management. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. Stratos Wealth Partners and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

[1] https://www.britannica.com/science/biosphere/Efficiency-of-solar-energy-utilization


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