Personal Finance

Tax efficiency is essential for investors, and failure to account for it can be detrimental to your portfolio’s performance. In a world where every percentage point counts, being caught unaware by unexpected tax obligations can set you back considerably. If you’re investing in mutual funds, it’s crucial to be aware of the potential for a nasty surprise: the mutual fund tax trap. The Importance of Tax Awareness A comprehensive Morningstar study spanning the years 1926 to 2021 showcased that ignoring taxes in your investment decisions could slash your portfolio returns…

The landscape of retirement planning is ever-evolving, and in recent years, the rise of cash balance retirement plans (CBPs) has been notable. As the need for financial solutions that accommodate the aspirations of high earners grows, these plans present a compelling option. Why Cash Balance Plans are Gaining Popularity Maintaining a comfortable standard of living post-retirement is an objective many investors share. Traditional vehicles like the 401(k) have served many adequately, but for high earners who have enjoyed plush salaries over the years, the prospect of reproducing that income during…

“How much do I need to retire?” This seemingly simple question is one that many grapple with as they approach retirement age. The answer is both complex and multifaceted, varying based on individual circumstances, desires, and uncertainties that loom large over future financial plans. Decoding the Retirement Savings Factors We dove deep into the data and have created a series of age-based retirement savings factors to serve as beacons in the often foggy landscape of retirement planning. It’s essential to note that while these milestones are aspirational, you may not…

Introduction The landscape of retirement savings vehicles in the U.S. is vast and varied. Among the most popular are the Roth 401(k), Roth IRA, and the Traditional 401(k). Each offers its own unique set of benefits, but which one is right for you? This article will delve into the intricacies of these accounts and help you make an informed decision. Definitions Roth 401(k) A Roth 401(k) is a type of employer-sponsored retirement account where contributions are made after-tax. This means that you pay taxes on the money before it goes…

Understanding Social Security benefits can seem like deciphering an intricate puzzle. With myriad rules and seemingly complex formulas, making uninformed decisions can be detrimental. Seeking advice from financial professionals to strategize your Social Security claims is crucial. Before you step into this maze, let’s debunk 5 widespread myths about Social Security. Myth #1: Claiming Social Security Benefits at Age 62 is Mandatory Contrary to popular belief, age 62 is merely the earliest age to start claiming your benefits, not a mandatory age. The Social Security Administration (SSA) determines your “full…

In every relationship, trust and transparency are vital. This is particularly true when it comes to finances. As Kelly Quinlan, an advanced planner with years of experience working for Fidelity, has seen, financial infidelity can creep into relationships in surprising ways. From hiding accounts to neglecting to consider a partner’s future financial needs, financial infidelity can manifest in both intentional and unintentional ways. While these oversights may not always be malicious, they can be just as damaging to a relationship. The Importance of a Financially Transparent Relationship An ideal financial…

In a financial landscape that is ever-shifting, Social Security recipients are looking at a notably smaller increase in 2024. This change comes on the heels of an unprecedented 8.7% cost-of-living increase in 2023 as inflation soared, and it brings a mix of news—both reassuring and concerning—for retirees and disabled individuals who rely on these benefits. The Smaller Raise: What’s Behind the Numbers Recent trends indicate that inflation is cooling down, and as a result, Social Security checks are expected to rise by about 3% in 2024. This figure, derived from…

Debt is a subject that weighs heavily on many people’s minds. The pressure of mounting interest rates and never-ending payments can feel overwhelming. But escaping the shackles of debt is possible, and the freedom it offers is well worth the effort. “Paying off debt doesn’t need to be complicated,” says Fidelity vice president Ann Dowd, CFP®. Let’s explore five practical steps to help you take control of your finances and get out of unhealthy debt for good. 1. Look for Lower Interest Rates High-interest rates can keep you buried under…

Retirement, the time to enjoy the fruits of your labor, can ironically bring on the overwhelming task of managing healthcare. Medicare, the federal health insurance program for those aged 65 and older, with its guidebook exceeding 100 pages, is complex and fraught with potential pitfalls. It’s all too easy to make costly mistakes that could leave you with unnecessary expenses or a gap in coverage. While Medicare mistakes can happen to anyone, being aware of the potential traps can help you navigate the landscape better and save you time, money,…

With increasing healthcare costs posing a challenge for most individuals and families, it’s important to explore different strategies to manage these expenses. Nearly four in ten people reported deferring medical care in 2022 due to the prohibitive costs. That’s the highest on record since Gallup first asked that question in 2021. Thus, the need to control health care spending has never been more apparent. Here are 10 proven strategies to help you take control of your healthcare spending, both in the present and in the future: 1. Embrace Preventive Care…