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Slick TV ads often make financial planning and wealth management sound simple, but it’s usually not. Managing wealth requires knowing a lot about highly technical topics, like taxes, government regulations, and finance as well as history, psychology and how to communicate with loved ones about sensitive issues. This article highlights some of the knowledge needed to manage wealth and why it’s often so daunting without the help of an independent personal financial advisor who is familiar with your situation.
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Understanding The Federal Reserve Mandate To End Inflation
The Federal Reserve System, the nation’s central bank, has a dual mandate to pursue maximum employment and maintain price stability. These two priorities are currently treated equally, but that was not always the case. In fact, the Fed’s bias toward maximizing employment was a critical driver of the stagflation that plagued the U.S. in the late 1960s and 1970s. Recognizing the need to balance price stability and maximum employment, in 1977, Congress revised the Federal Reserve Act.
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Fed Governor Kugler Details Inflation And Economic Outlook
The 12-month inflation rate, as measured by the personal consumption expenditures (PCE) index, was 2.6% in December, down from its peak of 7.1% in June 2022, and the six-month rate for PCE inflation was even lower, at 2%, which is the target rate set by the Federal Reserve.
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Why Rates May Not Be Cut Until June
The cost of a loan to buy a home, car, college education, and achieve the American Dream is staying the same for now. As expected, Federal Reserve Chairman Jerome Powell said the central bank did not lower loan rates following the Fed’s Wednesday, Jan. 31, 2024, policy meeting.
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Practical Suggestions For Achieving Your 2024 Resolutions
New Year’s resolutions usually fail because they‘re often too hard to achieve. After six months, only 10% of people who make resolutions achieve them or remain committed to them, , according to a study by Dr. Mark Griffiths, a Chartered Psychologist and Distinguished Professor of Behavioral Addiction at the Nottingham Trent University. What can you do to make financial, medical, or other personal resolutions more likely to be achieved?
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A Sign Of Progress In Solving U.S. Economic Problems
The Federal Reserve appears to be pulling off a feat most experts did not believe it could: ending its aggressive inflation-fighting campaign of 11 interest rate hikes without tipping the U.S. economy into a recession.
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Fed Keeps Rates Unchanged; Expects Easing In 2024
To promote transparency and free markets, the Federal Reserve System began publishing the opinions of the 19 U.S. central bankers that decide interest rate policy.
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Have You Logged Into Your Social Security Account?
Have you logged in to your Social Security account? Creating an online account at SSA.gov is an important first step in understanding your retirement income situation. However, only about 60 million of the 160 million individuals in the U.S. labor force who have Social Security accounts have created a way to access the Social Security Administration’s website.
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The Great Fake Out Of 2023 Is Poised To Extend Into 2024
All year long, the economy and stock prices have fooled experts and consumers, outperforming expectations month after month.
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Test Your Financial Planning IQ
The five questions below are a challenge meant to allow you to assess your knowledge of investing, tax and financial planning. If you have been following our news stream, this quiz draws on familiar ground. The answers are below.
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Planning Briefs
Set Your Financial Priorities Right Now
Published Tuesday, Sept. 15, 2020; 10:30 PM EST
(Tuesday, Sept. 15, 2020; 10:30 PM EST) As a professional advisory firm, perhaps the most job important service we provide is as a "choice decider," someone you can rely on to prioritize your best choices for building your wealth and planning your future.
As a financial choice decider, it's important to tell you that perhaps the very best choice you could make right now is to pay attention to tax planning opportunities, and to show you choices you must make by the end of 2020.
Amid the stock market's headline-grabbing gyrations and record-setting performance, focusing on tax planning may seem counterintuitive but it's a strategic imperative. Here are three examples of potential tax problems that could arise and for which you need to be prepared before the end of the year:
- Rather than paying a higher capital gains tax rate expected under a Joe Biden Administration, now is the time to consider selling a highly appreciated asset by December 31, 2020. President Donald Trump, according to the Tax Foundation, has not formally announced a capital gains tax policy but has publicly mentioned lowering the capital gains tax from 20% to 15%. With the U.S. Government's expenses exceeding revenue from taxes for many years and the Covid pandemic unexpectedly weakening the nation's balance sheet , planning now for likely higher capital gains taxes is prudent. This applies to stocks and other appreciated investments.
- Now would also be a good time to consider selling property – like real estate – on an installment-loan basis to your children or grandchildren. Depending on the national election results, you might elect not to consummate the sale. You have until October 15, 2021 to decide – long after the election is settled and the Biden or Trump Administration may have enacted a new U.S. tax plan.
- In 2020, you're not subject to payroll taxes on wages and salary exceeding $137,700. Under Biden's plan, earnings of more than $400,000 would be subject to the 12.4% payroll tax. Meanwhile, President Trump has called for forgiveness for the September 1 through December 31, 2020 employee-side payroll tax deferral. To sidestep these potentially higher taxes, consider establishing an S-corp by the end of 2020 to reduce the payroll tax liability should your earnings exceed $400,000 and thus be subject to the 12.4% payroll tax.
If your family's situation involves an installment sale to the next generation or if you earn more than $400,000 a year, immediate action should be taken because implementing a solution may require drafting legal documents and estate and tax lawyers are expected to be busy between now and the end of 2020.
Please contact us about your personal situation, as the tax and other issues involved are substantially dependent on your personal circumstances.
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