News

1
Jun

Client-Professional Communicating During Times of Uncertainty

During times of uncertainty, communicating with others, and your advisor can be beneficial during any life-altering or world-changing event. For some, survival is their only plan when their financial resources are depleting. Others are more fortunate, and their finances are holding while they continue to work. But for most, dealing with COVID-19 and the aftermath can create a fog of uncertainty.

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25
May

Emotional Investing in Times of Uncertainty

Investors want to enjoy a good night’s sleep each night because they’ve done their work, know what to expect, and that nothing comes as a surprise to them. However, in times of uncertainty, most of us let our emotions get the best of us, especially about our investments. Part of the luxury of a good night’s sleep is being financially educated and planning for when things don’t go as expected, as well as when they do. With the uncertainty of today, keep in mind what you can and can’t control and help avoid emotional investing:

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18
May

The CARES Act, RMD, and Hardship Distribution Changes: What You Need to Know

The CARES Act (The Coronavirus Aid, Relief, and Economic Security Act) became law on March 27th, 2020. It contains significant legislation for Required Minimum Distributions (RMD) for those over age 70 ½ who have already started RMD. Under previous IRS distribution laws, a minimum distribution from a pre-tax retirement savings account, such as a 401(k), IRA, or other tax-sheltered accounts, would have to happen in 2020 to avoid the penalty for not taking a distribution. Under the CARES Act, no RMD is required for individuals or beneficiaries of inherited retirement accounts in 2020 due to COVID-19. How will this help investors?

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11
May

Finding Safety in a Low-Interest Environment

When investors think of ‘safe investments,’ they tend to think of bonds or CDs, which calculate from a pre-determined timeline and interest rates. During a low-interest-rate environment, both provide safety, but not necessarily, the returns investors are seeking. Bonds and CDs have differing benefits and risks despite being viewed by investors as ‘safe.’

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4
May

COVID-19: Negatively Impacting the Social Security Retirement System

COVID-19 has changed the way we interact with others and our ability to work. Currently, one in four worldwide confirmed COVID-19 cases is occurring in the U.S. The halting of economic activity is expected to damage our economy more than any other previous occurrence. While remote work is happening at some companies, many Americans are unable to collect their regular paychecks and are waiting on unemployment assistance from their state. Undoubtedly this will negatively impact Social Security tax collection and the Social Security Retirement System. Here’s why:

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27
Apr

In Need of Tax-free Income in Retirement? Consider Life Insurance

When you think about tax-free income in retirement, the traditional vehicles likely come to mind. Such as your 401(k) or 403(b), traditional and Roth IRAs, and your personal savings account. What you may not consider, however, is that life insurance can also function as a form of retirement income – with tax advantages.

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20
Apr

Crisis Preparation: 3 Things for Safeguarding Your Financial Future

Safeguarding your financial future is important.

Safeguarding your financial future is important. No one likes to think about the impact of their death on their loved ones. But the reality is, not having certain elements in place can turn a tragic situation into a financial crisis. Having these safeguards in place can help provide your family with the financial security they need should the unexpected happen.

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13
Apr

Reflect, Reset, Rebalance Your Life

Not everyone experiences a life-changing event in their lifetime, one that impacts them for better or worse. As we continue to experience the pandemic, we are witnesses to our own experiences. We don’t know the outcome will be for ourselves, our neighbors, community, and so on. It can be an unnerving, but positive experience if it is a life-changing event that changes us for the better. As you reflect on the pandemic in the next weeks and months, consider your life as it is today and the changes that you intend to make to rebalance your life.

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6
Apr

Coronavirus and The Markets: What You Need to Know

With coronavirus (COVID-19) all around us, investors may be wondering how their investments will fare as this ‘global pandemic’ spreads. Is COVID-19 capable of moving markets? We know it is and came at a time when the economy was already stressing. Earlier market movements starting in February 2020 were the result of unassociated economic factors and the public’s reaction to fear. Now, while the U.S.  economy is being impacted, investor’s resilience to react will be tested. The ‘markets’ hate uncertainty. How much and how long COVID-19 will affect economies is to be determined. Let’s take a look at Coronavirus and the markets.

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23
Mar

HENRYs (High Earners Not Rich Yet) with Limited Wealth-Building Potential- Are You One of Them?

The term HENRY (High Earners Not Rich Yet) refers to individuals who have the potential to become wealthy in the future because of their income. These individuals or families earn between $250,000 and $500,000 per year and are between 25 and 45 years of age (Gen Z, Millennials, and Gen X). Despite their income, after paying their living costs, taxes, and other expenditures, HENRYs have little left over to save and invest for their retirement. HENRYs are a demographic that politicians consider being ‘rich,’ referring to them as the wealthiest Americans during the 2008 elections. However, there’s more to the HENRY story.

‘Rich’ is when you have assets in savings, retirement accounts, and other income-producing investments. Not the material things that you own and not things you owe on. HENRYs are the ‘working rich’ because most of what they make is immediately spent. Unlike the wealthiest 1% of Americans who continuously work to build their assets.

The Plight of the HENRY

Part of the plight of HENRYs is that their wealth projects from their six-figure income, not their spending habits or the building of wealth through investing. Additionally, HENRYs tend to want to keep up their appearance of success by spending. They are easily targeted by advertisements showing the lavish lifestyle they desire, and they frequently spend on those items.

According to research by MoneyinMotion, the top industries employing HENRYs include banking and finance (including insurance), technology, and large retailers generally holding manager or VP titles. Their top purchases include:

  • Diet, weight loss, exercise memberships
  • Boating and sailing
  • Entertainment
  • Online shopping
  • Automobiles
  • Vacations

While HENRYs have the potential to be wealthy, many will not fare well in retirement. This is due to their lack of retirement assets. If you are a High Earners Not Rich Yet, you still have the potential to save enough for retirement. However, those that continue the same spending habits with little priority on retirement savings during the earning years will not yield the retirement they desire. If you need financial guidance to change your current spending or accumulate retirement assets, feel free to contact our office at any time.

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At Senior Tax Advisory Group, each one of our seasoned professionals is a vital part of your financial team.  Our team has experience in all aspects of financial planning. We have what it takes to provide you with a comprehensive retirement plan. Contact us today to schedule an introductory meeting!