Who to Hire
A fiduciary is a person who holds their clients’ interest above their own. Make sure anyone you are hiring for financial advice is a fiduciary. (Test this by asking them if they are a fiduciary, if they hedge around the question, it likely means they are not.) Do you know if your financial advisor is a fiduciary?
Insurance or Investments?
Insurance is great because it’s insurance, it’s not an investment! Insurance companies often create products that they sell as investment vehicles. Don’t be fooled. Buy insurance when you need insurance. Buy investments when you want to invest. Do you know if you have an insurance product or an investment product?
Education Savings
Many families choose to save money to pay for their children’s education. If you are choosing to pay for your child’s education from anywhere between kindergarten to graduate school, you should be saving in Edvest. Utilizing this can reduce your tuition cost by as much as 7 percent. Do you have a child you are saving for and are you maximizing your savings options?
Balance Sheet
A Balance Sheet is a document that lists all your assets and debts on one sheet. Do you have a balance sheet that you maintain?
Emergency Fund
An Emergency fund generally represents 3 to 6 months of living expenses. Do you have one or do you know how to build one?
Tax Planning
We all know what taxes are. Taxes are the bane of existence. Sometimes you will willingly pay more in taxes in one year in order to pay less tax in your lifetime. Do you know how to optimize how much you pay in tax?
Consolidate and Simplify
Oftentimes people have accounts floating around the universe that are completely unmanaged. Do you have all of your accounts consolidated to the fewest practical amount? If you have three IRA’s the answer is no.
Roth vs Traditional
IRAs come in two flavors. Traditional and Roth. Do you know which one is best for you to be saving in? If you are in a low tax bracket or less, save in the Roth. If you are in a high tax bracket, save in the Traditional. If you are in between or don’t know, contact me.
Rebalance Regularly
Rebalancing is trading your portfolio to your targets. At least every year make sure that your stocks and bonds make up the percentage of your portfolio you want them to be. Do you know what percentage of stocks and bonds make up your portfolio currently?
401k vs IRA
Both of these are retirement accounts in which people can choose to save money. Sometimes your 401k is not your best choice. Do you know how to maximize these two different options for your benefit?
Back Door Roth IRA
Back Door Roth IRA is an opportunity to save into a Roth IRA, regardless of your level of income. According to the rules, you usually need to be in a lower income bracket to be able to save in a Roth IRA. There is a simple way around that rule. Are you a candidate for it and do you know how to create that for yourself?
Asset Location
Asset location is determining what assets (your investments) to place in which account type. For example, you want to put assets that you expect to grow the most in a Roth IRA. You want to put the assets that you expect to grow the least, like bonds, in a Traditional IRA. If you have the right assets in the right place, you can increase your return by reducing the taxes you owe on those account withdrawals. Are you managing what asset types you are placing in your accounts?
Estate Planning
Estate planning is planning for what occurs after you are gone, and possibly more important for when you are living. Addressing and documenting your wishes for when you are unable to make decisions on your own. Do you know what estate documents you need to have in place?
Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design) and CFP®(with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements.
