- We Have $1.6 Million in a 401(k) and $1.1 Million in Other Investments. How Do We Structure Our Withdrawals So We Don’t Touch the Principal?
My husband wants to retire in August 2025 when I turn 65. My husband turned 65 in December 2024. We have $1.1 million saved (includes stocks, ETFs and mutual funds) along with $1.6 million in a 401(k). We will, at that time, start to collect Social Security. What would be a good rule of thumb for… read more…
- How to Meet Tennessee Residency Requirements for Your Taxes
Tennessee is one of the few states that does not impose a personal income tax, making it an attractive option for individuals seeking tax advantages. However, establishing residency is not just about moving to the state — it requires meeting specific legal criteria. Whether you are relocating permanently or trying to sever tax ties with… read more…
- How to Meet Nevada Residency Requirements for Your Taxes
Since Nevada does not impose a personal income tax, many individuals relocate to the state to benefit from its tax-friendly environment. However, simply moving to Nevada is not enough — meeting Nevada residency requirements is important for legally claiming state residency. Residency status can impact tax obligations, voter registration, tuition rates and legal documentation. If… read more…
- What Is Activity Ratio and How Is It Calculated?
One of the key metrics used to gauge the efficiency of a business is the activity ratio. This type of financial measurement provides insights into how well a company utilizes its assets to generate revenue. By examining activity ratios, investors and analysts can determine how efficiently a company is managing its resources to maximize sales… read more…
- What Is Default Risk With Common Stocks?
Default risk refers to the possibility that a company may fail to meet its financial obligations, such as paying dividends or repaying debt. When a company that has issued common stock defaults, the value of its common shares will likely be severely impacted and investors holding them may experience a total loss of principal. As… read more…
- What Is a Discretionary Account and How Does It Work?
A discretionary account allows a financial advisor or portfolio manager to make investment decisions for the account holder. This type of account suits investors who prefer not to manage their investments directly or don’t have the time and expertise to do so. By giving the advisor authority, the investor lets them manage the investments according… read more…
- Ask an Advisor: My Net Worth Is $3.76M and I’ll Collect $4,600 Per Month in Social Security. How Much Can I Afford to Spend on a House in Retirement?
How much can I afford to pay for a home and still maintain a comfortable retirement without worrying about running out of money? I’m 66 and I have about $1.78 million in a taxable investment account, $1.5 million in IRAs, $309,000 in a Roth and $115,000 in a deferred compensation plan. I also have a… read more…
- How Businesses Can Use Purchase Order (PO) Financing
Purchase order (PO) financing is a funding solution designed to help businesses meet large customer orders they might not have the cash flow to fulfill. With PO financing, a lender or financing company provides funds to cover the costs of goods required to complete an order. This type of financing allows businesses to grow, maintain… read more…
- What Is Basis Risk and Why Is It Important?
Basis risk refers to the potential mismatch between the value of an asset or liability and the financial instrument used to hedge or manage its risk. This divergence can result in unexpected gains or losses, even when a hedging strategy is in place. Basis risk is particularly relevant for investors, traders and companies that use… read more…
- What Is Delta Hedging and How Can You Leverage It?
Delta hedging is a risk management strategy used to reduce or neutralize the price movements of an underlying asset in options trading. By adjusting the positions in the underlying asset to match the delta of an option, traders can create a more stable portfolio that is less sensitive to small market fluctuations. It is a… read more…
- How to Avoid a Bull Trap in the Market
A bull trap is a false signal that can make it seem as though a declining trend in a stock or index has reversed and is heading upward when, in fact, the security will continue to decline. This can lure in long buyers who think the stock is at its turning point, only to have… read more…
- I’m Selling My House and Will Net $375k in Profit. Will I Owe Capital Gains Taxes?
A home seller may not owe any capital gains taxes on sale of a principal residence if the transaction qualifies for the Section 121 exclusion. However, under certain circumstances the seller may owe capital gains tax on at least part of the gain. It’s also possible for the entire gain to be taxed as ordinary… read more…
- Ask an Advisor: I Have 2 Years Before I’m Eligible for Medicare. What’s My Best Option for Health Insurance?
What’s the best route for medical insurance without a work place option? I need two years of coverage before Medicare kicks in. – Robert Health insurance and its associated costs are an important consideration in retirement – even more so if you retire before qualifying for Medicare at age 65. I don’t think there’s any… read more…
- Ask an Advisor: Can I Invest My $10,000 RMD into an Annuity to Avoid Paying Taxes on It?
Here is my question, which uses hypothetical values for simplicity: My RMD for 2024 is $10,000. Can I avoid paying the IRS the tax on that $10,000 this year by investing the full $10,000 RMD or the value of the tax on the $10,000 into a qualified longevity annuity contract (QLAC). I just retired in… read more…
- Comprehensive Guide on How to Manage Your Personal Finances
According to Experian, about 60% of Americans don’t understand their own finances. Within that group, another two-thirds say this has led them to mistakes costing $1,000 or more. So if you don’t feel like you have a great handle on your money, you’re not alone. To improve your personal finance management, consider taking these five steps.… read more…
- Guide to Long-Term Financial Planning for Lawyers
Lawyers often have high student loans to pay and can earn less than what many expect. In 2023, the Bureau of Labor Statistics (BLS) says that the median salary for a lawyer was $145,760 per year, which means that half of those in the legal profession earned less than that. So managing debt is a… read more…
- Guide to Long-Term Financial Planning for Dentists
As a professional field, dentists are comfortably high earners. According to the Bureau of Labor Statistics (BLS), the median a dentist can expect to earn is roughly $166,000 per year, with many earning significantly more. And, unlike the long nights of their patients in law and business, and the 18-hour shifts of their medical colleagues,… read more…
- How Is My Debt Handled If I Get Divorced and Remarried?
Divorce and remarriage can raise questions about how debt is divided and managed between former and new partners. In most cases, debt acquired during a marriage is considered marital debt and may be divided during the divorce process, depending on state laws. However, debt brought into a remarriage typically remains the responsibility of the individual… read more…
- What Is Financial Freedom?
Financial freedom is a term often mentioned in conversations about personal finance, yet its true meaning varies from person to person. For some, financial freedom is the ability to live without worrying about daily expenses, while for others, it represents the long-term goal of not needing to rely on a steady paycheck. Whatever your definition,… read more…
- Ask an Advisor: My Wife Did a $40K Roth Conversion in a Low-Tax Year. Does She Really Need to Wait 5 Years to Withdraw it?
I encouraged my wife to take a $40,000 Roth conversion in a lower tax year. Even though she has another Roth IRA at a different broker, she was encouraged to keep the money where she already had her 401(k), which we converted to a IRA and then to a Roth IRA. She is well past… read more…
- I’m a 43 Year Old Divorced Dad. I Have $580k in My 401(k) and Contribute the Maximum. Can I Retire in 10 Years?
You can put a lot of money in your 401(k). Each year the IRS allows what is known as a maximum contribution to any pre-tax retirement account. For an employer-sponsored account like a 401(k), you can have up to $70,000 per year in joint employee/employer contributions in 2025 if you’re under age 50 — $23,500… read more…
- Ask an Advisor: Is There a Downside to Taking a Monthly Pension vs. Lump Sum?
Is there a downside to taking your pension on a monthly basis vs. taking a lump sum? The monthly payments would be higher than the return I would get on the lump sum. – Claudette There are certainly some downsides of taking monthly pension payments instead of a lump sum. But that doesn’t necessarily mean… read more…
- Can I Get Out of Debt After I Get Divorced?
Divorce can be a challenging and emotional experience. Not only that, the financial implications can linger long after the paperwork is finalized. For many, tackling debt after a divorce is a top priority. Whether it’s dividing credit card balances, car loans or mortgage debt, knowing how to manage the debt you’re left with can help… read more…
- How Does Retrocession Work in Investment Management?
Retrocession in investment management refers to the practice where a portion of the fees or commissions received by a financial institution, such as a bank or investment firm, is shared with a third party. This third party is often an intermediary, like a financial advisor or broker, who has facilitated the transaction or brought the… read more…
- Ask an Advisor: Will Capital Gains and Dividends in My Brokerage Account Impact My Social Security Benefits at 62?
Does the interest, dividends and capital gains from assets owned in my taxable brokerage account count toward the Social Security earnings limit? Only wages from employment or self-employment count toward the exempt earnings limit for those who file for early Social Security. Investment income won’t result in benefit withholdings, but it can influence the taxation… read more…