Financial Planning

Taxes

While it is virtually impossible for investors to avoid taxes, there are several strategies that you can employ to help reduce or defer taxes. These common sense strategies can help reduce the tax burden while good quality investment portfolios work toward long-term success.

For example, even the best stock portfolios are likely to have a few holdings that aren’t meeting your expectations. Selling stocks at a loss from their purchase prices can make sense if they can be replaced with other holdings that offer prospects that are as attractive or more so. The realized capital loss can be used to offset capital gains that are realized for the same year. Other strategies include helping you fulfill your charitable giving goals through gifting appreciated assets, analyzing investment turnover, taking full advantage of the features of qualified retirement vehicles and using municipal bonds judiciously.

As an independent Financial Advisor with LPL Financial, the nation’s leading independent brokerage firm , I can help. With years of training and experience, I can assist you in analyzing your existing portfolio, and offer recommendations that will help you to maximize your after-tax returns. You can benefit from top-quality investment choices combined with professional guidance and objective advice.

Estate

A variety of legal documents and tools can help ensure that your assets are distributed according to your wishes. These may include a will, powers of attorney, and one or more types of trusts, such as a living trust, which may help you control assets while you are alive and potentially provide tax benefits.

Assets held outside your will — including life insurance contracts, IRAs and employer-sponsored retirement plans accounts — will pass directly to beneficiaries you’ve named to receive them. Consequently, it’s necessary to keep such beneficiary designations up-to-date and accurate.

In addition to ensuring that your assets are passed on to those you intend, helping you to reduce taxes is a major purpose of estate planning. New federal estate tax laws were established in 2001, bringing about a gradual reduction of estate taxes through 2010. Under current rules, taxpayers can exclude the first $1.5 million of an estate’s assets from federal estate taxes in 2004. This exemption increases to $2 million in 2006, and $3.5 million in 2009. The law also decreases estate tax rates. Currently, the top rate is 48%. This rate gradually decreases to 45 percent in 2007, and in 2010, the estate tax will be repealed. In 2011, however, unless Congress intervenes, the estate tax will revert to the pre-2001 tax structure, with a $1 million exemption and a maximum rate of 55%.

While current tax law creates opportunities, it also requires planning vigilance. For instance, you may want to review your will and any trusts and rebalance assets to ensure that the division of wealth between you and your spouse and other beneficiaries remains as intended. As your financial consultant, I welcome the opportunity to schedule a meeting with you to talk about your options for investing your assets. After all, your inheritance today could be part of the wealth you transfer to the next generation.

[1] Based on total revenues, as reported in Financial Planning magazine, 1996 – 2007

Retirement

Retirement may be the end of your working years, but it’s just the beginning of what should be the most important phase of your life. When will yours begin … at age 55, 62, 67? What kind of lifestyle do you want to have? Will you spend more time traveling, visiting family, volunteering, exercising, painting, writing … teaching? How can you prepare for this stage, and when should you start? Wouldn’t you like to know if you are on track to make this happen?

Most people focus on the day-to-day activities. Few people realize that they should plan for their retirement as if they were preparing to take a long vacation. You can expect to spend from 15 to 30 years or more in the retirement phase of your life. What will you be doing? Where? For how long? How much will it cost?

You make travel arrangements weeks or even months before taking a trip, so you can get the flights, car rentals and hotels that you want. You plan where to go, how long to stay, what clothes to bring, and how much it will cost. Make travel arrangements at the last minute, and you will surely sweat the details. It works the same way in planning for your retirement years. Creating and implementing the right plan can make your life less stressful and more enjoyable, because you will have taken out a lot of the uncertainty about the future. There will be roadblocks and speed bumps along the way, but a plan will help you get through them and back on track.

Many of our clients have found that a financial plan helped them to crystallize their goals and prepare for the lifestyle of which they dreamed. There will undoubtedly be roadblocks and speed bumps along the road, but a plan will help you steer through them and get back on track. How will you spend the retirement phase of your life? Let us help you navigate along the road to your retirement dream and start to develop your plan today.

College

Many parents dream of the day their child strides to the stage to receive a college diploma. At the same time, they may dread the day college tuition bills arrive. Saving for any child’s education requires a long-term plan. And, like saving for retirement, the earlier you start your plan, the better the results.