The financial puzzle for millennials: What’s the best way to pay off student debt while saving toward retirement? Here are four steps to a sustainable plan. 

Millennials really like the idea of retiring early. In fact, when Charles Schwab surveyed 2,000 millennials aged 16–25, the average age at which they expect to retire is 60 years old. That is a whole seven years earlier than the current Social Security full retirement benefit eligibility for their age bracket, and several years earlier than the average retirement age.

Moreover, based on the average millennial’s saving patterns, this goal of retiring early is not entirely realistic. According to the National Institute on Retirement Security, approximately 66% of people aged 21–31 have nothing saved for retirement. Meanwhile, Fidelity found that as of the third quarter of 2022, those aged 25–34 have an average 401(k) balance of $22,100. Thirty-somethings have slightly more, an average balance of $63,800. Although these young adults as a group are putting more money away for retirement than they were a few years ago (when millennials had an average balance of $13,100 and contributed 5.9% of their income), it appears that most of them will not be on track to retire in their early 60s.

The other challenge facing this generation is the inordinate amount of student debt that they are shouldering. Essentially, they face a perfect storm: large amounts of student debt and limited job prospects when they first graduated from high school and college, along with unrealistic expectations and a lack of preparation regarding their future responsibilities.

Premarital financial planning can help a couple start off on the right foot. Whether it’s a first marriage or a subsequent union, make it a priority to discuss these seven issues before the big day.

Budget planning

Once married, your expenses will likely change. Sit down and figure out what your expenses are likely to be and decide whether you’ll maintain separate accounts, with each being responsible for certain household expenses, or throw all your income into one pot. You may also want to assign roles: who will pay the bills, who will handle the investments, what process you will use to make major financial decisions.

Here’s how to get a jump-start on creating a system to organize your bills, statements, policies and other financial paperwork.

Financial organization is a cornerstone of a healthy financial life. At the most basic level, financial organization saves time and money because it aids in paying bills on time, finding needed documents during tax season, providing proof of payment, disputing credit cards or billing errors, and avoiding the stress of dealing with piles of unorganized bills and paperwork.

It also sets the stage for better decisions on investments, budgeting, debt, and investment planning. Financial organization helps your working relationship with your financial professional because there will be less time spent looking for paperwork and more clarity around the overall financial situation, leading to more informed decisions about your investments and financial plans.

Whether you are a parent or a grandparent, your new little bundle of joy will be “dear” in more ways than one. Here’s how to plan for the financial to-dos and priorities of new (grand) parenthood.

Births, deaths, marriages, and divorces are significant life events that require financial resources and planning. Of all of these, a new baby is one of the most joyful, as parents and grandparents share their hopes and dreams as the birth comes closer.

When planning for the financial aspects of parenthood, it’s wise to be as proactive as possible. There are many expenses to consider, so take some time to consider the long-term implications of parenthood and put together a budget that will allow saving for future expenses.

Most baby boomers will face seven key events in their last stage of life that will color their finances and investments. Prepare for these events by thinking about them now.

It can be dangerous to generalize about the baby boom generation, but there are seven key events that nearly everyone will face as they move through the last third of their lives. Unlike earlier, happier events such as getting married, having children, and moving up the career ladder, some of these events may be anticipated with dread. For this reason, many boomers may put off facing them. But lack of preparation can make a bad situation even worse.

Key Financial Data 2025

Divorce is never easy, but collecting information and thinking through some of the issues before you even meet with an attorney can help you move through this life transition as smoothly as possible. Here’s a checklist outlining the information you’ll need to gather and why.

Divorce can be devastating—both emotionally and financially—for the unprepared. However, getting some financial help early in the divorce process can make the ordeal easier on you and your loved ones. Pre-divorce financial planning can help lower legal costs and increase the likelihood that you and your former spouse can reach a workable settlement.

The decision on whether to sell or rent your home is trickier than other financial decisions because of the emotional ties you have to your home. To make the best decision possible, evaluate the income, growth, and tax advantages of selling vs. renting and how it would advance your long-term goals.

If you are relocating due to a job change or retirement, you may want to keep your present home and rent it out rather than selling it and transferring the equity to a new home or reinvesting the proceeds.

The first question to ask is yourself is why are you considering this strategy? Here are some of the more common reasons:

The government has become pesky about one thing—they want the tax dollars that have been locked up in traditional retirement accounts.

And think about it. Some of that money has been untouchable for decades. In light of budget woes and Washington wrangling, it makes sense that the government is eager for its long-awaited payoff.

Although, courtesy of SECURE Act 2.0, required minimum distributions (RMDs) don’t begin until age 73 now (and age 75 in 2033) and the government is still very strict about exceptions to the RMD rules. And it is very difficult to decrease RMDs once you have accumulated that large account balance, which is why advanced tax planning is the best way to address these challenges.

Retirement planning takes on added urgency the closer you get to leaving your job. Imagine your future by looking at the major factors: housing, activities, lifestyle, life expectancy, and unexpected events.

The first step in any retirement income plan is to envision your retirement and make some decisions about how you will live. This, in turn, will inform your budget and your retirement income plan. If the numbers don’t support the life you have in mind, now is the time to find out. Adjustments can always be made, whether it means working a little longer now in order to avoid working later, or scaling back your lifestyle in order to retire a little sooner. But what you want to avoid—and why you are going through this exercise in the first place—is the need to make major adjustments ten or twenty years from now. The more accurately you can answer these questions, the more likely you are to create a retirement income plan that will sustain you throughout life.

IRA or 401(k)? Know the key differences between these two popular retirement plans to ensure you are saving in the right account.

Individual retirement accounts (IRAs) and 401(k)s share a lot of similarities. They are both retirement plans. They both can help you lower your tax bill today, provide tax-deferred growth, and help provide an income source in retirement.

But there are also many differences between IRAs and 401(k)s. Some are relatively benign and probably won’t impact you very much, but other differences can make one type of account far superior to the other in particular situations. With that in mind, today we explore five things you can do with an IRA that you can’t with a 401(k).

The SECURE Act is by far the biggest retirement-oriented legislation to be enacted in over a decade. Many Americans are left wondering, “What does this mean for me?” Here’s what you need to know.

The SECURE Act, passed in late 2019, is by far the biggest retirement-oriented legislation to be enacted in over a decade. The new law is a very good thing for some retirees and not such a good thing for others. Barely half of the workforce is covered by a retirement savings plan through their employer, and the SECURE Act is meant to address this issue, among other things. Here are some key provisions in the Act that may affect your retirement plans.

Roth 401(k)s and Roth IRAs share the ultimate goal of tax-free distributions of earnings, but they are governed by different rules along the way. This side-by-side comparison can help determine which vehicle suits your needs best.

Roth 401(k)s and Roth IRAs share the ultimate goal of tax-free distributions of earnings. But while both of these accounts are funded with amounts that have already been taxed, the path to that tax-free goal is paved with different rules for each of these two types of accounts.

As you consider your retirement planning needs, which will likely include adding Roth options for a tax-diversified retirement nest egg, the following overview of the differences might be helpful with determining which Roth account is more suitable.

It sounds odd to say, but death is a part of life for us all. It’s one of the few things that we all have in common at some point, and it’s one of the few issues that must be addressed in everyone’s plan.

While each situation is unique, however, and you have your own goals and objectives, the overwhelming majority of married individuals with IRAs and other similar accounts, such as 401(k)s and 403(b)s, will name their spouse as their primary beneficiary as part of their estate plans. As such, knowing the rules for when a spouse inherits an IRA is critical.

A retirement plan is built on a set of assumptions that can’t be validated until it’s too late. One key to successful retirement planning is carefully setting assumptions and revising them often.

Retirement calculators make it so easy. Pick a retirement date. Estimate your living expenses in retirement and choose an inflation
rate. Figure out a rate of return for your investments. Guess how long you think you’ll live. Put these assumptions into the calculator, and it will tell you just how much you need to have at retirement in order to receive the income stream you desire.

One approach to building income streams for your clients’ golden years is to match assets to liabilities using bond immunization and a total return strategy. It may tilt the portfolio’s allocation a bit, but it could be the answer to funding retirement, college, and other long-term obligations.

Clients who are worried about making their retirement portfolios last a lifetime will be able to appreciate the challenges faced by insurance companies and pension funds. Both are charged with investing assets in a way that will allow them to meet obligations for many years into the future. But unlike the relatively predictable nature of household living expenses, the future liabilities of insurers and pension funds are subject to wide variations.

It’s a big transition when clients leave the workforce to live off their savings, requiring an attitude adjustment in both you and your clients. Here are the issues to consider when time, compounding, and other conventional investment principles no longer work in your favor. 

Retirement planning is easy during the accumulation phase. Just stash as much savings as possible into retirement and investment accounts, and maximize total returns. All that really matters is what the client ends up with at retirement. It’s a race to grow the nest egg as large as possible. Success is measured by account values, pure and simple.

It’s a big transition when you leave the workforce to live off your savings, requiring an attitude adjustment in both you and your advisor. Here are the issues to consider when time, compounding, and conventional investment principles no longer work in your favor.

Retirement planning is easy during the accumulation phase. Just stash as much savings as possible into retirement and investment accounts, and maximize total returns. All that really matters is what the client ends up with at retirement. If investment returns vary from year to year, or if returns are made up of interest, dividends, or capital gains, none of it much matters. It’s all a race to grow the nest egg as large as possible. Success is measured by account values, pure and simple.

Retirement is a totally new stage of life. With some careful prioritizing—and collaborating with your financial professional—you can design a working plan for retirement that may surpass all your expectations.

When most people think of retirement, they imagine leaving a job they’re tired of, getting out of the rat race, and leaving the pressures of employment behind. Often, retirement is viewed as a reward for time in the workforce and successful financial planning.

But retirement is so much more than giving up a job and relaxing. Retirees are entering one of the most exciting and challenging stages of their life.

Working full-time and then abruptly stopping work at age 65 is no longer the only possibility for retirement. “Downshifting” allows for a more gradual process, benefiting employers and employees.

I have a friend who plays principal clarinet with a major symphony orchestra. She loves her work—which, after all, is literally playing—but at age 61 she’s getting tired of the grind.

Now, my friend Leah (not her real name) loves the creative aspects of her work—interpreting the music, playing solos, teaching students—but other aspects of the job, like some of the obligatory community outreach activities, no longer hold her interest. When I suggested that she offload some of these activities to younger members of the orchestra, she said she thought that wouldn’t be fair to them, that as principal she should be a good leader and get down in the trenches. But because this part of the job was so wearing on her, she was thinking about retiring from the orchestra altogether.

Using your retirement nest egg to fund a start-up means taking a risk within a risk. Regardless, many retirees choose to pursue it. Meeting with an advisor and reviewing your retirement plan from a business planning perspective is the smartest way to prepare for post-retirement entrepreneurship.

As more and more baby boomers contemplate starting their own businesses in retirement, tapping retirement funds for start-up capital is becoming a common practice.
At first blush, taking a distribution from your own account seems much simpler than writing a formal business plan and taking the risk of being turned down by bankers or investors. It may also seem more feasible than taking out a home equity loan or maxing out credit cards—the usual sources of financing for micro businesses. However, an ambitious entrepreneur with a good idea and a pot full of retirement money is a dangerous thing, especially if he depends on that pot to support him in his old age

In determining the best ways to diversify your retirement portfolio, you need to change the inputs, look at the income streams, and decide what trade-off to make between inflation and market risk. There are no easy answers.

Conventional wisdom states that investment habits should change in retirement. Once you shift from the “accumulation phase” to the “distribution phase,” you presumably have everything you’re ever going to have, so the goal now is to make those assets last as long
as you live, while generating an income along the way.

When it comes to the distribution of retirement assets, where those assets are located in the portfolio can have a direct bearing on how much income you receive.

Asset allocation is conventional wisdom for most investors; asset location, not so much. But an ill- conceived asset location strategy can cost you in both the accumulation and distribution phases, says William Reichenstein, Ph.D., CFA, and professor of investment management at Baylor University in Waco, Texas.

It’s a touchy subject, but a life expectancy analysis is the best way to ensure you will have enough money to live your later years in comfort and ease.

What do people fear the most in retirement? Outliving their income. And what variable has the largest impact on whether or not they will outlive their income? Life expectancy. Your ability to successfully plan for retirement is largely dependent on how well you can estimate your life span.

Longevity is the new buzzword in retirement planning, and rightfully so. It wasn’t that long ago when most people retired at 65 and maybe lived another five to 10 years if they were lucky. Those days are over, which makes current retirement planning a much more challenging endeavor. People are living much longer, and their retirement nest eggs must live much longer as well. Not only are life spans increasing, but statistics tell us that the longer people live, the longer they will live.

When you leave a job with a significant amount of appreciated company stock, you might want to explore possible tax breaks related to its “net unrealized appreciation.”

Although it’s generally wise to roll a lump sum distribution from a 401(k) plan into an IRA when changing jobs or retiring, sometimes it’s advisable to think twice before doing
so, especially if you hold significant amounts of highly appreciated company stock in your employer-sponsored retirement plan.

Funding a 30-year retirement will take financial planning prowess as you juggle the effects of inflation, distributions, taxes, asset allocation, and expenditures. Are you up to the task?

George Foreman, the boxer-turned-spokesman for portable grills, may have best summed up the retirement conundrum facing baby boomers: “The question isn’t at what age I want to retire; it’s at what income.” The amount you’ll need each year to maintain your desired standard of living is the most critical variable to identify in the retirement planning process. No rule of thumb will suffice.

As a business owner, you may be surprised to find that offering the right retirement plan may significantly benefit both you and your employees. Here’s an overview of all the major features of each kind of retirement plan, including SIMPLE, SEP, 401(k), defined-benefit, and profit-sharing plans.

The vast majority of businesses in the U.S. employ fewer than 100 workers, yet these employees have less access to retirement planning vehicles and other benefits than those who work for larger companies. That means about 50% of Americans don’t have the same opportunity to save for retirement via tax-advantaged vehicles that many others have.

In fact, a recent survey of small business owners reveals that only about half of all small businesses offer a retirement plan, although that number has been steadily increasing. It’s likely that those businesses would be more attractive to potential employees if they offered a retirement plan.

Many clients assume that when retirement rolls around, they should draw cash from their taxable accounts first. Generally, this is a good idea; but not always.

A basic tenet of tax planning is to put off paying taxes for as long as possible. By investing money rather than turning it over immediately to Uncle Sam, your clients can earn returns that are theirs to keep; tax deferral becomes like a loan that actually pays interest to the borrower. This is why IRA rollovers are such a great idea—clients can keep deferring the taxes on their retirement distributions and put that money to work in investments, rather than losing a chunk to current taxes.

Many people assume that when retirement rolls around, they should draw cash from their taxable accounts first. Generally, this is a good idea; but not always.

A basic tenet of tax planning is to put off paying taxes for as long as possible. By investing money rather than turning it over immediately to Uncle Sam, you can earn returns that are yours to keep; tax deferral becomes like a loan that actually pays interest to the borrower. This is why IRA rollovers are such a great idea—you can keep deferring the taxes on your retirement distributions and put that money to work in investments, rather than losing a chunk to current taxes.

Paying the penalty may be worth it if the end result increases your assets. A case of a couple saving for retirement shows that a penalty is a small price to pay in building a bigger nest egg.

Whether it’s sports, taxes or life, we’re programmed to avoid penalties, and usually that’s a good move. Occasionally, however, by simply avoiding penalties, we can be detrimental to ourselves. Indeed, sometimes incurring a penalty on purpose can be the right move. Consider the following:

Worried about having enough saved for retirement? Here’s a simple approach: work just a few years longer. By accumulating more savings and shortening your withdrawal period, you’ll reduce the lump sum needed to generate the necessary income at retirement.

Surveys show that most baby boomers plan to work in some capacity during their retirement years. The question is, should you keep working a little longer at your primary career (that is, delay retirement), or should you retire early and go back to work doing something different?

Boomers who are tired of their jobs are naturally eager to get out of the rat race and do something more enjoyable and fulfilling. But there is pretty convincing evidence why working in one’s primary career just a few years longer can make a huge difference in the amount of money a retiree has available in retirement.

You may be surprised at some of the documents we recommend when it comes to estate planning and generational wealth transfer.

Leaving a lasting legacy for your family requires smart planning now. Intergenerational wealth transfers can create havoc within the family if not handled correctly. We discuss below six documents that you should have in order to protect the wealth and the harmony of the family.

Discover what it means to be wealthy or successful. If you’re like most, it takes a few hard knocks to understand what life truly has to offer.

Several years ago at the Berkshire Hathaway annual shareholder's meeting in Omaha, Neb., a precocious 10-year-old investor stood bravely in front of a microphone and posed a weighty question for the investment maestro: “How do you define success in life?”

It’s not easy to contemplate your own mortality, but a good estate plan can provide for your heirs, protect your assets, and promote family harmony once you’re gone.

Estate planning is complex and because it involves facing your own mortality, it can be difficult subject to address. While you most likely have a will, this simple document may not be sufficient to manage your estate and efficiently pass on assets to your heirs. Even if you have an estate plan that you’re confident in, it’s a good idea to review that plan in light of changes resulting from the Tax Cuts and Jobs Act of 2017.

Here are 10 simple questions that address the basic issues of estate planning:

As a lesser-known but viable alternative to a private foundation, a community foundation offers a number of philanthropic—as well as tax-related—benefits, especially for smaller donors.

Creating a family legacy through charitable giving receives a lot of press when the likes of Bill Gates and Warren Buffett commit to leaving huge amounts of their fortune to charity. We typically think of a private foundation as a solution for someone with substantial assets, or as a commercial gift fund sponsored by various fund families. However, another option that is not that well known but can work for smaller donors is your local community foundation.

With government health care policies always uncertain and the memory of super storms still fresh, now is a good time to review insurance policies coverage, insurance needs, and emergency plans.

Insurance coverage tends to be the stepchild of family financial planning. All too often, insurance is obtained and then put on autopilot, only to be found inadequate when a disaster or problem strikes. That’s why it makes sense to take time every year to review insurance coverage, consider situations when new coverage may be required, and look at the implication of disaster planning on insurance coverage.

Here are the types of coverage and issues to consider in any review of personal insurance policies:

Celebrities have enough money to hire the best estate planning lawyers. You would think celebrities, of all people, should have ironclad estate plans that keep their affairs private, leave money and possessions to the people they love and the charities they care about, and take advantage of legal ways to avoid or minimize estate taxes.

Unfortunately, it doesn’t always turn out that way. Celebrities can be negligent about estate planning, no matter how much money they have. Other than not having a will, the biggest mistake is relying on a simple will to transfer a sizable estate. By failing to take advantage of trusts, celebrities hurt their loved ones in three ways: 1) a big chunk of the estate is lost to estate taxes; 2) probate proceedings are public and can drag on for years; and 3) their fortune may even end up in the wrong hands.

In most families, the needs and interests of family members overlap. Even if your money is separate, planning needs to happen for all.

It is normal, when working with your financial professional, to focus on the needs of your immediate family. If you are a baby boomer, for example, you are probably looking at retirement planning, when to take Social Security, how to invest your retirement assets, and so on. Other financial planning issues such as college and home buying are behind you, while long-term care and estate planning will be coming up. But there are some very good reasons why your financial planning activities and discussions should span the generations: why you might want to look into college planning, and why your children should know something about long-term care.

When a parent is considering giving or lending a child money, the key question is whether it’s empowering or enabling. You need to structure a transfer that is best for both generations.

When my older daughter Meredith bought a house in Portland, Oregon, in 2015, she needed help with the down payment. Housing prices were escalating fast and she feared that if she didn’t get in then, she would forever be forced to rent. So I transferred $27,000 to her account. She assumed it would be a loan.

But in looking at her financial situation—she works hard but as a private school teacher doesn’t get paid a lot—I didn’t want to burden her with payments to me, so I called it an advance on her inheritance.

Having a will is necessary, but there is a great deal of information the legal document does not include. Here’s what to cover in a supplemental letter that specifies preferences, discloses critical logistic info, and will save your family significant stress during a difficult time.

Having a proper will goes a long way to prevent family arguments. The guesswork is eliminated, and the family is clear on your intentions. Furthermore, a will may actually save money, because without one, the provincial/state authorities are in control, and that could mean unnecessary delays and extra costs.

Just as a will brings a feeling of peace and comfort, so does an accompanying letter listing items usually not included in the will. Here are several suggestions you may consider including in your or your loved one’s accompanying letter:

What would happen if your earliest childhood dreams actually powered your life and business plans? What if you integrated fun into your weekly, monthly, and life goals? If you’re spending time on things that don’t matter, here’s a chance to rethink your plan.

What life lessons would you share with the world if you had just months to live? For Professor Randy Pausch, a 47-year-old computer science professor at Carnegie Mellon, this became more than just an academic question.

Prior to his death from pancreatic cancer in 2008, a video of Pausch’s life-affirming Last Lecture went viral online, inspiring millions and making Pausch an internet celebrity. The Lecture—a paean to honoring personal goals and fidelity to oneself as a means to achievement—went on to garner high-profile media attention everywhere from Oprah to the Wall Street Journal.

You may need to transfer assets for all sorts of reasons. A working knowledge of various transfer techniques can help you determine when it’s appropriate to move money around, and how to minimize the tax and legal implications of the process.

Asset transfers are an important part of financial planning. As you move through life, you are constantly acquiring and disposing of assets until that final transfer takes place—the one you’re not around to see.

Some asset transfers are initiated as a result of a life event or other major decision. Others are suggested by attorneys or financial advisors as a way to better arrange your affairs. Some asset transfers are as easy as handing a tangible item over to another individual. Others are fraught with legalities and should not be attempted without counsel.

As a generation, baby boomers are starting to wonder how we can leave our mark upon the world. What, besides material possessions, can we hand down to the next generation? How do we capture and define the wisdom and values that we’ve cultivated over decades of experience? How do we pass these precious assets down to our children, grandchildren, and the world at large?

Anyone who’s lived a full, rich life has the potential to leave a vast legacy in the form of stories, letters, photographs, and teachings. But where do you start? How do you begin to harness the knowledge and experience of your life and arrange it in a form that will live on after you’re gone?

One of the biggest drains on your account may not be the market, but rather family requests for money that may never be repaid. Preserve assets—and emotional health—by setting up a “family bank” where loan requests are reviewed, approved of, and monitored.

Pity the poor widow. Left with a sizable portfolio, she thinks her financial future is secure. Little does she realize that one of the biggest threats to her future security is not the markets and not her health, but her own loving children, who think she has cash to spare. One by one, they quietly approach her for loans that will never be repaid. The guilt she feels from turning them down is worse than the fear created by the draining of her assets, but what’s a mother to do?

What is the best approach if you need to sell an inherited estate, excess inventory from your business, or high-priced collectibles you no longer want? Use these tips on selling property at auctions to help you handle the sale and get the best price.

When you want, or need, to sell valuable personal property, you might consider putting it up for auction. Unlike a subjective appraisal, the auction process determines the real fair market value of an item by extracting the highest price an actual buyer will pay.

In an English auction—the most common type for artwork and other collectibles—potential buyers keep raising their bids until no one wants to pay more than the last bid entered. At that point the auctioneer cries “Sold!” strikes a hammer on the block, announces the price, and identifies the buyer. The buyer pays the auction house the agreed amount and takes the item home or arranges for delivery. Shortly thereafter (typically within 35 days), the auction house pays the seller net proceeds from the sale. Net proceeds are the selling price less commission and expenses.

If you got hit by a bus tomorrow, would your loved ones know how to access your important records? Would they know which accounts you hold and where your money is? What about insurance policies? Real estate ownership papers?

You may have your records organized in a way that works for you, but imagine what your loved ones would face if you weren’t around to show them where everything is. This is why an important part of legacy planning is organizing your files so the people closest to you can access them.

Inheriting a fortune may prevent a life of financial hardship, but the inheritance may bring other problems. Consider how much to leave your kids by asking some important questions.

A popular belief today is that too much money spoils kids. Over the years, several heirs have gone public with their stories about the corrupting influence of large inheritances. Jessie O’Neill, granddaughter of former General Motors CEO Charles E. Wilson, founded the Affluenza Project to provide information and counseling to people having difficulty coping with money. She says that in her case, her inheritance led to feelings of guilt, fear, and isolation.

An untrustworthy executor can foil even the most well-designed estate plan. Use these guidelines to select a reliable executor—one who will assure that assets pass to their rightful heirs.

Think about what will happen to your assets after you die. I’m not talking about wills, trusts, or other estate-planning tools used to specify who inherits your property. I’m talking about what physically happens to your assets when you are no longer around to oversee them. Who takes charge immediately following your death? Who oversees the investment portfolio and makes the buy/sell decisions until your assets are distributed to the heirs? Who pays the bills and files the tax returns? And perhaps most important, who’s responsible for physically transferring the assets into the heirs’ names as instructed by the will?

What can be worse than losing a spouse—especially with young children to raise? How about being forced to go through probate and losing needed assets to ex-spouses and estranged family members?

If only there had been a will.

Advisors are used to beating the drum about proper estate planning and predictably, year after year, the same clients will give an awkward laugh and sheepishly admit that they still haven’t made a will. It just doesn’t seem that important. Dead is dead, right? And besides, all the assets will go to the spouse, so he or she can worry about passing it on to the kids.

If only that were true.

Forty-six years and seven husbands after inheriting her $40 million Woolworth fortune, Barbara Hutton died with a mere $3,000. Learning from her mistakes, you may better prepare your children and grandchildren for stable futures—both financially and emotionally.

At the age of 10, Barbara Hutton, granddaughter of F. W. Woolworth and niece of E. F. Hutton, inherited some $25 million. The money stayed in trust, managed by her stockbroker father, Frank (E. F. Hutton’s brother), until Barbara was 21. By the time the money became hers at age 21, the fortune had ballooned to some $40 million, thanks in part to Frank’s astute decision to sell out early enough in 1929 to miss the crash in October. After receiving the $40 million inheritance in 1933, Barbara gave her father $5 million as a thank-you gift for his management services. Then she embarked on the sad, lonely life of a socialite both envied and exploited for her money.

Whether you are managing debt, investing assets, or developing an estate plan, changes in interest rates represent an excellent opportunity to review your financial plan and consider new strategies designed to capitalize on changing conditions.

Calling the direction of interest rates has always been an iffy proposition. In many cases, even the experts disagree. But when the economy is in recovery and rates are inching up, it may be time to plan a new strategy. Here are some ways you can tweak your financial plans to take advantage of—or lessen the sting of—higher interest rates.

It might look like “sudden money,” but cash windfalls are often easy to spot—sometimes years ahead of time—if you know where and how to look.

Never is financial advice more urgently needed than when you come into a large amount of cash.

Complacence is no longer an option when you look at a check with several commas and realize that depositing it into an existing checking or savings account must be a temporary measure only. The opportunity cost on such a large amount of money earning zero or low interest could amount to hundreds of dollars per day, leading to the urgent question “What shall I do with this?”

Some of our best investors rose from the ashes of devastating events. As you tackle the challenges of the current market environment, take inspiration from investors who persevered, survived, and prospered.

“Regardless of who you are or what you have been, you can be what you want to be,” said W. Clement Stone, who died in September 2002 at age 100.

A one-time Chicago newsboy and the only child of a widow, Stone began working at age 16. Eventually, he turned a $100 investment into a $2 billion insurance company, now part of AON Corp. Stone’s trademarks included his pencil-thin mustache, colorful bow ties, and unfailingly upbeat attitude. The Rev. Robert Schuller, speaking at his funeral, said, “He’s probably the most positive-thinking person I ever knew.

Rational investors make better decisions—or so the thinking goes. However, new studies show that rational thought and emotions are both necessary to cut through the details, focus on what’s important, and get on with the decision that needs to be made.

The science of economics has long been based on the assumption that people act rationally when making financial decisions. Money and math require cognitive thinking, so it’s presumed that rational thinking is what people use when deciding whether to buy or sell, borrow or lend, or choose the right account for their savings. If emotions do enter into the picture, economists argue, they should be minimized in an effort to restore rational thought to financial decision-making. Under orthodox or Keynesian economics, emotions disturb rationality.

Estimating taxes is so difficult that we usually just work with the pretax value of investments in constructing portfolios or building retirement plans. But it’s a disservice to clients not to consider the tax bill when setting the allocation. The question becomes how?

Uncle Sam is a silent partner in nearly every investment. His cut depends on a number of factors unique to each situation:

The type of account the investment is held in (taxable or tax-deferred)
The type of income earned (interest, dividends, capital gains, or IRA distribution)
The investor’s tax bracket at the time the income or gain is reported

Most people are very proud of their wealth. And why shouldn’t you be? You’ve worked your entire life to build your investment accounts, and often sacrificed a great deal. However, once you hit the retirement “spending” phase, the government changes the rules on you, and you could essentially be punished for decades of following the rules and scrupulously saving.

The saddest part is that most people don’t know what awaits them, as they have never retired before and they aren’t aware of the potential pitfalls that their accumulated retirement accounts can cause.

With these year-end giving strategies, you can make charitable donations in ways that are most beneficial to your financial situation.

Many people have charitable inclinations, however, they do not realize the variety of ways they can donate or that through donating they can receive significant tax breaks. Even though fewer people will be itemizing deductions as a result of the Tax Cuts and Jobs Act, there are still many ways to realize tax savings from your charitable giving.

Typically, people think of donating to charity by check or cash, but that is not always the most effective way to go about it. These five giving strategies combine the desire to support good causes with the possibility of saving significant money through tax breaks.

Given the complex tax situation many high-income earners face, start tax planning in the fall while there is still time to make adjustments. These seven questions can help you spot problem areas and better understand the services you may need.

Although tax season is still months away, tax management should begin in the fall—especially for high-income earners facing the 3.8% net investment income tax, AMT, and other taxes. Below are seven questions that can help you open a discussion with your CPA and your financial professional about next year’s tax bill. Have the discussion early in the fall so you still have time to make adjustments if necessary.

While national focus has been on uncertainty around new tax laws, there are many individual tax-planning opportunities you should consider before year-end to ensure you are getting the best deal while staying compliant.

Although the Tax Cuts and Jobs Act of 2017 and SECURE Act of 2019 captured national attention, there are still plenty of tax-planning opportunities you need to pay attention to, particularly if there has been a change in your financial situation during the year. Good tax planning enables you to stay compliant while positioning yourself to pay as little in taxes as possible.

Woe to the taxpayer who runs afoul of the numerous and confusing IRA rules. There are forms to file, contributions to make, distributions to take, and penalties to avoid. While corrections are possible, it’s best to avoid mistakes in the first place. Here’s what you need to know.

IRAs come with a lot of rules, especially when it comes to taxes. Failure to follow the rules can result in penalties, excise taxes, double taxation, and in a worst-case scenario, the loss of your tax-deferred status. Here are a few tips that can help you avoid unnecessary—and costly—errors.

When was the last time you examined your will or trusts? How about power of attorney or plans to gift assets? Under the new tax act, only eight per 10,000 estates will owe federal estate tax—at least until the act sunsets. That means everything needs to be reviewed.

Qualified charitable distributions from an IRA provide individuals over 70½ with a way to receive income tax savings on charitable gifts—even if they decide to take the newly increased standard deduction.

The number of individuals who claimed charitable deductions on their taxes fell below 70% for the fourth consecutive year, according to “Giving USA 2022: The Annual Report on Philanthropy.” So what happened?

This decline is mainly the result of the Tax Cut and Jobs Act (TCJA) of 2017. The Tax Policy Center had estimated that the law would cut the number of households itemizing deductions from about 37 million in 2017 to 16 million in 2018.

The Tax Cuts and Jobs Act of 2017 introduced a limit for deductions on state and local taxes. Some states hoped to get around that through charitable contributions. But the IRS says no.

In August of 2018, the IRS released new proposed regulations (technically, they are amendments to existing regulations) to deal with states’ recent attempts to circumvent
the state and local income tax (SALT) deduction limit that was put into place by the Tax Cuts and Jobs Act. In short, the proposed regulations effectively eliminate the strategy of donating to state-run “charities,” for which you receive a credit against state taxes, and a deduction for a charitable contribution for federal income tax purposes.

The Tax Cuts and Jobs Act has made major changes to the tax code. It’s important that you understand these changes to best plan your tax strategy going forward.

The Tax Cuts and Jobs Act has brought the biggest tax overhaul in 30 years and has left many with questions. It’s important that you understand how the elimination of deductions, compression of tax rates, and brand-new benefits for certain taxpayers will affect your tax strategy. According to the Tax Foundation, most taxpayers saw a reduction in tax rates, but for many lower income taxpayers, that tax cut was so little it may hardly even be noticed. And if you live in a high-tax state or you rely heavily on deductions, you are likely to see a tax increase.

At 1097 pages, the new tax act is the most far-reaching and complex tax code passed by Congress since 1986. This article looks at ramifications in the areas of deductions,
divorce, and estate plans.

The Tax Cuts and Jobs Act (TCJA) is old enough now that you’ve probably had an opportunity to review many of its highlights and consider how the changes may impact your family. It’s the most far-reaching and complex federal tax code passed by Congress since 1986, but whether its impact will be negative or positive for you depends completely on the particulars of each situation. Let’s review three potential issues with the act and some viable solutions.

With such a high standard deduction, taxpayers may not get additional itemized deductions for charitable donations. However, with a little clever planning in charitable giving, taxpayers can exceed the standard deduction, start itemizing again, and lower their tax bill.

In 2017, the standard deduction was $6,350 for individuals and $12,700 for married couples. However, as a result of the Tax Cuts and Jobs Act (TCJA) of 2017,
the standard deduction almost doubles for 2018 and years to come. In 2022 it is $12,950 for individuals and $25,900 for married couples. This means that an
estimated 90% of households will now be better off taking the standard deduction rather than itemizing deductions.

The Tax Cuts and Jobs Act has made 529 plans more flexible, such that parents can access these funds for younger students and to benefit their children who are disabled.

Over the past 30 years, the average price of a public four-year institution of higher education has increased by 213%, while the average price for a four-year private
school has gone up by 129%. And, by 2036, four years at a private university will cost $303,000, according to CNBC. While in the past, a college student was able to work a
summer job and save throughout high school in order to pay for four years at a good public institution, those days are long gone.

If you are an IRA owner interested in donating to charity, a qualified charitable distribution may be an option. These 10 rules outline how a QCD should be done.

Arguably, one of the biggest changes to the tax code in the Tax Cuts and Jobs Act of 2017 was the doubling of the standard deduction. The Joint Committee
on Taxation estimates that nearly 90% of taxpayers are likely to take the standard deduction instead of itemizing. The decision not to itemize means that charitable giving doesn’t seem like such a tax break.

Wondering how to maximize your Social Security income? It’s not as difficult as you may believe. Here are three options almost anyone can do. 

Not so long ago, baby boomers viewed Social Security as a retirement program for old folks. High-earning boomers felt that Social Security didn’t apply to them because the monthly checks were small, and they believed the system wouldn’t be around when they retired.

Now the tide has shifted. Nearly all boomers have embraced Social Security, and they’re on a mission to get the most out of the system. Maximizing Social Security has become a national obsession, even—especially—among high-earners.

Social Security is more complicated than most people think. Here are six of the most common questions that come up on Social Security.

With the baby boom generation entering retirement, there’s a lot of demand for good Social Security information. People are confused—both about how the system works, and how these inner workings affect their retirement decisions. These six questions address some of the most common sources of confusion around Social Security: When to apply, how to undo bad claiming decisions, how work affects benefits, and options for divorcees and survivors.

According to a recent study, retirees will collectively lose $3.4 trillion in potential income that they could spend during their retirement because they claimed Social Security at a suboptimal time.

Each year, the Social Security Administration (SSA) announces the cost-of-living adjustment for the next year. Whether you are retired or not, you should be aware of what the changes mean.

In October, the Social Security Administration announced that the cost-of-living adjustment (COLA) for 2025 is 2.5%. The increase shows up in beneficiaries’ January checks. Also in the fall, the Centers for Medicare and Medicaid Services (CMS) announced Medicare premiums for 2025. The Part B base premium will be $185, up from $174.70 in 2024. The income-related monthly adjustment amount (IRMAA) for Part B and Part D will be going up by a few dollars for all the tiers. Inflation adjustments raised the income tiers. The IRMAA now starts at $106,000 for single individuals (up from $103,000) and $212,000 for married couples (up from $206,000).

For some families, dependent benefits for children with disabilities are an important factor in the Social Security claiming equation. Here’s what you need to know.

Children with disabilities such as Down syndrome, autism, or some other type of disability generally do not qualify for Social Security benefits. In order to receive Supplemental Security Income (SSI), the entire household must meet rather strict income and resource limits. Income must be under the SSI federal benefit rate, currently $967 per month, and assets are limited to $2,000.

A divorced person who was married more than ten years may be able to receive Social Security benefits based on their ex-spouse’s work record.

Some women (and it’s usually the woman who was the lower-earning spouse) aren’t aware of this additional benefit, especially if the marriage and divorce occurred early in life. We sometimes encounter women in their 70s or 80s who are receiving a low benefit on their own work record, only to discover that they never applied for their divorced-spouse benefit. Once we confirm that they meet the eligibility requirements, all that’s needed is for them to go online or call SSA and file for divorced-spouse benefits under their former spouse’s record. Then they can receive a spousal add-on, bringing their total combined benefit up to 50% of their former spouse’s primary insurance amount (PIA).

Most people tend to underestimate their life expectancy. But thinking you might live to a very old age might lead to better planning decisions.

Life expectancy is a critical element in Social Security planning. Because benefits continue for life, the total amount you stand to receive over your lifetime hinges on how long you and your spouse live. In fact, we could add a new strategy for maximizing Social Security benefits—to live a really, really long time. Nothing maximizes total Social Security benefits more than extreme longevity.

There is a great deal of confusion about how military pay is counted for Social Security purposes. If you or someone you love is in the military, don’t fall prey to misinformation.

At various seminars around the country, veterans are told that unless they show DD Form 214, they could lose out on as much as $1,200. This is misleading. Only those who served before 1968 are required to provide DD-214. And the $1,200 they get is not in the form of benefits, but a credit to their earnings record. By the time the earnings are factored into the average indexed monthly earnings (AIME) and the primary insurance amount (PIA), the effect is negligible. If it’s not among the 35 top earning years, it’s not counted at all.

Social Security can be a tricky subject for many clients, with added complexity for small business owners. One common question concerns compensation for family members and their eligibility for Social Security. Here are the factors to consider.

A common question asked by business owners is whether or not they should put a spouse on the payroll to make them eligible for their own Social Security benefits. The wives of working husbands already qualify for spousal benefits, but these benefits are only 50% of the working husband’s primary insurance amount. Is it worth it to pay Social Security taxes on her, so she can qualify for her own benefit?

What if you or your spouse lives to a very ripe old age—to 90, 95, or even 100? The key to having enough income in your old age is to maximize the higher-earning spouse’s benefit. This can be done by having the higher-earning spouse delay the start of benefits to age 70.

Survivor planning is one of the most important aspects of Savvy Social Security Planning. It starts with the basic understanding that if both spouses are receiving Social Security and one spouse dies, the surviving spouse starts receiving the higher of the two benefits and the other benefit stops.

The vast majority of American citizens spend their whole lives in the U.S., paying into the U.S. Social Security system and eventually drawing benefits which are deposited into a U.S. bank account. But as with all things Social Security, there can be complications.

Here are some examples of how Social Security works in overseas cases.

I am a U.S. citizen. Can I receive Social Security benefits if I live outside the U.S.?
Yes. Although SSA will send checks to other countries (with a few exceptions), it is recommended that you have the payments automatically deposited to your bank account to avoid mail delays and currency conversion fees.

If you have minor children at home, Social Security benefits may be available to them. Know these rules and get maximum benefits for your family.

It is not so unusual today for a person eligible for Social Security retirement benefits to have young children. Once the parent files for benefits, a minor child may also qualify for Social Security dependent benefits. The child can be a natural child, an adopted child, or a stepchild.

Each child may receive 50% of the parent’s primary insurance amount (PIA) up to the family maximum. The benefit may continue until the child is 18, or 19 if still in high school.

Spousal and survivor benefits for same-sex couples have been in limbo over the years. Obergefell v. Hodges granting same-sex couples the right to marry provided much-needed clarity.

Since 1939, nonworking spouses of covered workers have been able to receive a spousal benefit equal to 50% of the working spouse’s primary insurance amount (PIA). If the worker-spouse dies, the spouse may receive a survivor benefit generally equal to the amount the deceased spouse was receiving at the time of death.

If you, or someone you know, has lost a spouse, look into the rules and strategies for Social Security survivor benefits. By coordinating these benefits with your own retirement benefit, you may be able to maximize both benefits.

Social Security can be a lifeline for widows. If your husband dies after you have both started receiving Social Security benefits, you can switch to your husband’s benefit amount if it is higher. This is why we generally recommend that the higher earning spouse claim benefits at 70 in order to maximize his own benefit while he is alive and to give his wife a higher survivor benefit after he dies.

Those “How much do you know about Social Security?” quizzes you see online are fun and interesting, but the bigger questions you should be asking are those that can help you get the most out of the program.

Do you know much Social Security you stand to receive over your lifetime?
People in their early 60s who are thinking about when to start Social Security tend to focus on the here and now. They understand that if they wait until 70 to claim Social Security they’ll get a higher monthly benefit, but it may not seem enough higher to justify giving up all those checks between ages 62 and 70.

If your employer health plan is a health savings account (HSA) paired with a high-deductible health plan (HDHP), you may have a problem when you turn 65.

Why? Because once you enroll in Medicare at 65, you (or your employer) may no longer contribute to your HSA. That’s just a rule.

I know what you’re thinking: Can you simply not enroll in Medicare at 65? This would allow you to stay on the employer plan and keep those HSA contributions flowing in so you can build up a nice pot of tax-free money to use for future medical expenses. The answer: probably not.

A key benefit of Social Security that most people never think about are the payments to survivors following the death of the primary wage earner. These payments can be life-saving for young families, of course, but they can also be very important in determining your retirement income.

A key benefit of Social Security that most people never think about are the payments to survivors following the death of the primary wage earner. These payments can be life-saving for young families, of course, but they can also be very important in determining your retirement income.

Under Social Security rules, if a person receiving a benefit becomes entitled to a different benefit, that person may switch to the new benefit if it’s higher.

This switching is one of the most important ways people can maximize their benefits, but they don’t always know how or when or even if they can do so. SSA often does not notify people of these switching opportunities, either because they don’t know that a higher benefit is available, or their system is not set up to issue such notifications.

If you track your Social Security benefit estimates via your annual statement, you’ve probably noticed some variations. How can it be that the amount you are scheduled to receive at full retirement age (FRA) is different—perhaps even lower—than it was a few years ago?

Earnings assumptions
The reason is that the Social Security Administration (SSA) is basing your future benefit on certain assumptions. One key assumption relates to your earnings. Using a complex algorithm that factors in your past earnings as well as projections for your future earnings, SSA refigures your benefit estimate every year, sometimes changing the amount based on variations in the average wage index. In other words, if they’ve been assuming your wages would rise by X% but the average wage index rises by less than X%, they will adjust your benefit estimate to account for the lower increase. If you see your benefit estimate go down, it doesn’t mean they are reducing your benefit; it means their prior estimate was too high.

When dealing with financial affairs, actions in one area can spill over into another. Sometimes these unintended consequences can be avoided; other times they don’t reveal themselves until it’s too late. Here’s what you need to be aware of when it comes to Social Security and Medicare.

What do you do when a strategy or action that solves one problem inadvertently creates a new one? And what if the remedy to the new problem has the potential to cause still another problem?

When dealing with financial affairs, actions in one area can spill over into another. Sometimes these unintended consequences can be avoided; other times they don’t reveal themselves until it’s too late. Here’s what you need to be aware of when it comes to Social Security and Medicare.

What do you do when a strategy or action that solves one problem inadvertently creates a new one? And what if the remedy to the new problem has the potential to cause still another problem?

This is what one client is facing.

What if you claimed Social Security and then realized you would rather stop benefits and get more later? Can you change your mind?

You might go back to work and no longer need the income. Or you might realize that it makes more sense to draw from other sources of income and let the Social Security benefit build delayed credits to age 70.

Most of us probably hope that we will never need disability benefits. But for those who qualify, they can be an important source of income.

The disability portion of the Social Security program is so big and so complex that there are law firms that specialize in helping workers navigate their way through it. Although you may never need to take advantage of disability benefits, it is good to have a working knowledge of the basics should the need arise.

With the demise of guaranteed pensions, and in light of the risks you face in managing your own retirement assets, maximizing Social Security becomes a critical part of retirement planning.

How claiming age affects the income stream
One of the most important decisions a retiree faces is when to apply for Social Security benefits. This is not a decision to be made lightly; the lifetime, inflation-adjusted income promised by Social Security makes it one of a retiree’s most significant assets.

You might assume it’s safer to keep your personal details—especially your Social Security number—off the internet. Actually, setting up a my Social Security account is an important step toward protecting your benefits.

We’ve all heard warnings not to give out our Social Security numbers anywhere—not on the phone, not online. So it might seem counterintuitive to set up an online account for managing your Social Security benefits. However, this is the exception, and here’s why.

I encourage everyone to go to ssa.gov/myaccount and open a my Social Security account. This is not just for people who are close to retirement. Everyone should open their own account with SSA—before someone else does.

Widows between the ages of 60 and 70 who qualify for both a survivor benefit based on their deceased spouse’s work record and a retirement benefit based on their own record have a unique opportunity to coordinate the two benefits to maximum advantage.

They can start a reduced survivor benefit as early as age 60 and switch to their own maximum benefit at 70. Or, if the survivor benefit at FRA would be higher than their own benefit if taken at 70, they can start their own reduced retirement benefit at 62 and switch to the full survivor benefit at full retirement age.

Continued earnings could increase your Social Security benefit, depending on your situation. One thing is for sure: working part-time at reduced pay will never cause your benefit to go down.

A common question among people in their 60s is this: If I keep working, will my Social Security benefit go up?

An even more common question is this: If I take a part-time job at a lower salary, will it cause my Social Security benefit to go down?

Medicare is more complicated than most people think. Here are ten of the most common questions that come up on Medicare.

People are confused about Medicare—both about how the system works, and how these inner workings affect their retirement decisions. These ten questions address some of the most common sources of confusion around Medicare: When to sign up, what to do if you are still working, how much it costs, and more.

Health care planning is a sensitive subject that often takes you and your advisor places you don’t want to go. But given rising expenses, no retirement plan is complete without some kind of provision for health care needs. Here are some guidelines and resources for estimating your needs and expenses.

Health care costs are rapidly emerging as a major expense item, both before and during retirement. With lifetime employment a relic of the past and longevity on the rise, it’s more important than ever to estimate how much to save to cover costs in retirement and include those expenses in your financial plan.

An apple a day keeps the doctor away—and spares you the bill for medical services. Does this logic carry over into lifetime health care planning? Can you reduce your lifetime health care costs by staying healthy.

Apparently not. The Center for Retirement Research at Boston College has revealed the counterintuitive finding that married couples who are the healthiest at age 65—that is, those with no chronic conditions such as diabetes, cancer, or heart disease—end up spending more on health care over their lifetime than their unhealthy counterparts.

For the past four decades, age 65 marked the time when you would leave your job, start your pension, file for Social Security, and enroll in Medicare. Not anymore.

Since then, the retirement landscape has changed. Full retirement age for Social Security is 66 or 67. The traditional corporate pension has given way to the 401(k) plan, which is generally taken as a lump sum upon leaving employment at any age, rather than monthly payments beginning at age 65. Even more significant is the fact that many baby boomers are continuing to work well into their late 60s and even 70s.

Medicare and health insurance open enrollment starts on October 15th. To help you find the best coverage for your money, here’s a step-by-step checklist of health care items to review annually.

Each fall, it’s important to review your health care needs and consider your available insurance options for the coming year. A recent survey found that 53% of respondents with employer-based coverage say they’re likely to keep their current plan. Only 37% review their health insurance costs annually.

While you were working, you likely relied on employer insurance. But after retirement your options are different, and that requires careful planning.

Some 157 million Americans get their health insurance through an employer, either their own or a spouse’s (or a parent’s, if under 26). Employers usually subsidize the premiums, so employees generally pay far less than the full cost of the insurance. Premiums for family coverage averaged $25,572 in 2024, according to the Kaiser Family Foundation 2024 Employer Health Benefits Survey, but employees paid just 25% of that, or $6,296 ($525 per month). The subsidy was even greater for single coverage: employees paid just 16% of the $8,951 annual premium, or $1,368 ($114 per month). These are averages, so your situation could be different.

Medicare for Individuals 65+

The most accurate and reliable way to determine your spending needs in retirement is to sit down and make up a budget projecting costs in the areas of housing, utilities, food, transportation, leisure activities and so on.

Depending on how your life will change (or not) after retirement, you can base these projections on the amounts you currently spend. If you don’t plan to move, for example, your housing and utility costs will remain the same. If you plan to travel, your leisure costs will go up. This pre-retirement math exercise is not difficult. It just involves making lifestyle choices.

If you’ve been covered by a generous employer group health plan, you may be in for a rude awakening when you retire. Here are some tricks for keeping health care costs under control after you retire.

Although the government may subsidize some of your health care costs under the Medicare program, you will still be responsible for certain out-of-pocket costs. You will want to do everything in your power to prepare for these costs, as well as avoid unnecessary costs like late enrollment penalties, overpriced private plans, and superfluous trips to the doctor.

It’s not true what they say about aging and the brain. Good thing, too. Now that you likely will live (and work) longer than previous generations, it’s imperative that you understand how to maintain and improve your most valuable asset.

Exciting research going on in the field of neuroscience is finding that the human brain does not have to shrivel up and die in old age, but that it continues developing so that older people can—if they work on it—become even more proficient in certain areas than when they were younger.

Here is what you need to know to navigate the 3.8% surtax on unearned investment income and the 0.9% additional tax on wages.

The Affordable Care Act (ACA) was designed to make health insurance more affordable, expand coverage, expand Medicaid, and help lower the overall cost of health care. The law was enacted in 2010.

One major source of revenue imposed by the ACA is centered around two new Medicare taxes that may affect high income earners:

The usual method for estimating spending needs in retirement is to take your post-retirement household budget and tack on an inflation rate, such as 2%. Not so for health expenses.

Some expenses increase at a faster rate than the inflation rate you use, others at a slower rate, but overall, expenses such as housing, utilities, food, and so on, should rise with the general rate of inflation.

Health expenses are an exception. Projecting future health care costs in retirement can be tricky because there are several factors influencing the amount you will pay for health care in the future.

Scenario planning shouldn’t stop at retirement. It’s unpleasant, but necessary, to imagine what your situation might look like after the death or incapacitation of a partner. An early dose of reality can help you build a financial foundation.

Two weeks ago, my neighbor died unexpectedly at the age of 76. Three weeks after beginning to feel sick, he was dead of lymphoma. Judging by his widow’s reaction, I am pretty sure they never contemplated this scenario. I am not close enough to my neighbor to pry into her financial affairs, but I am guessing that she will have to carry on with one less Social Security check and a small investment portfolio that she may or may not know how to manage.

Financial-aid award letters are often jargon-filled and confusing. You need to know how to evaluate what you are really getting. Better knowledge just might lead to a better aid package.

Financial aid award letters are confusing, primarily because colleges like it that way. It’s in a school’s interest to confuse families so they think an award letter is more generous than it really is.

But when you know how to decipher these letters, it may result in your child obtaining a better award.

Some parents are obsessed with getting their children into top-ranked schools no matter the cost. You can save a lot of money by understanding what truly leads to the best outcomes for your children.

With some schools now costing more than $300,000 for a single bachelor’s degree, it’s incredibly easy to overspend and think such an expenditure is absolutely essential. And this just isn’t true, even for the most highly ranked schools such as the Ivy League institutions and such vaunted institutions as Massachusetts Institute of Technology, Stanford University and Duke University, which is now just a few hundred dollars shy of $80,000 for one year!

Parents may assume they earn too much to qualify for financial aid. However, there are a number of strategies that even wealthy families can employ to cut expenses. Here are seven steps for estimating costs and maximizing financial aid.

While it’s no surprise that parents stress about how they’re going to pay for college, you may be shocked at those who are arguably the biggest worriers. In my experience, the people who are most proactive in seeking ways to cut college costs are affluent and wealthy parents.

College tuition is so expensive that even high-income families can get offers of financial aid. Your first step is to complete the federal forms, and then contact the school directly to further negotiate a financial aid package.

Every year the College Board faces a public relations challenge: how to accurately report trends in college pricing without discouraging high school students from going on to college. So in addition to its annual booklet “Trends in College Pricing,” the College Board publishes the annual report “Trends in Student Aid,” which describes the widespread availability of money for college. Both publications run 40 pages or more.

As college tuition continues to skyrocket, it’s becoming more important than ever to know how the various savings plans work. This handy reference outlines the latest rules on the most popular college savings programs, and how to use them to save money on your children’s education.

Aside from retirement, saving for a child’s college education is one of the biggest expenses a family encounters. And with college savings vehicles multiplying all the time and tax laws changing, the landscape of college education funding rules can be downright bewildering.

Which would really give the best value and experience? These eight steps will help you make a far better-informed choice, based not just on how sexy a school is, but genuinely differentiating facts.

For most families, money is an issue. Forget the idea that the school with the biggest brand name should determine where a child should enroll. It’s the story of the state school versus an Ivy League institution.

If you’ve started college planning at all you’ve heard about the FAFSA. Do you need to fill it out? For the vast majority of families, the answer is yes. This application is your gateway to all federal aid.

The FAFSA, which stands for the Free Application For Federal Student Aid, is the government application that millions and millions of parents fill out every year in order to qualify for federal and state college aid. The FAFSA gives families access to aid like federal parent and student loans and the Pell Grant, which is the major grant for middle- to lower-income families. There are also some minor grants from the federal government, for instance, for students who want to be a teacher in certain high-need subjects, or if a parent was killed in the Middle East conflict.

Finding and funding the right school at the right price for your kids can be challenging. You can get a better idea of how much any given school will really cost by accessing the resources outlined in these valuable steps.

One common question parents have when their child is approaching the end of high school is:

How can we afford college?

Here are a few key tips to consider when thinking about your child’s college costs.

Parents with big investments and home equity generally find it harder to get financial aid for their college-bound children. But if you understand how assets are assessed on the FAFSA and CSS Profile, you can improve your chances for getting the best financial aid package possible.

Do you know how your investments might reduce your chances for financial aid?

And what about the role that your family’s home equity plays in determining whether your child will receive financial help from a college?

If you have a teen who will be applying to colleges soon, make sure to work on admission essays well before the hectic onset of their senior year. Help them improve their essays—a critical admission factor—with some advice from experts.

Getting an early start—say in the summer—is essential for rising high school seniors writing their college essays. When school starts, seniors are going to be overwhelmed with classes, activities, and applying to colleges. Taking advantage of free time when it’s available is vital.

With all of the cost and stress of sending children to college, parents want their graduates equipped to get high-paying jobs quickly. Find out which schools offer their children the best employment prospects with some newly available and very useful tools.

When searching for schools, parents are increasingly asking admissions reps this question: Will my child earn a good salary after graduating from your college? College and university admission staffers will enthusiastically answer yes to that question, but their proof is almost always flimsy at best.

College planning isn’t for parents only. It’s an investment that should involve the whole family and offer students their first taste of financial planning.

It’s a time for parents to be realistic about what they can afford, and for students to give serious thought to the value of a college education and where it will get them in life. Most important, an in-depth discussion requires families to sit down at the kitchen table and talk about money.

With the cost of a college education rising higher and higher each year, consider all the options available to you before you take out expensive college loans.

Each year, the College Board issues a Trend in College Pricing report, and each year the trend is upward. And every year the message from the Board is the same: don’t worry, there’s plenty of financial aid available. But most of this aid is in the form of loans—not grants—and the combination of rising college costs and higher interest rates means students are starting adult life with ever-higher levels of debt.

For some time now, the cost of a college degree has been rising at perilously high rates, and as a result, the dream of one day going to college, for many, remains just that… a dream. With college costs rising so dramatically, it’s no surprise that people are looking for new ways to save for these expenses.

One such alternative method involves the use of a Roth IRA over more traditional college savings vehicles, such as 529 plans and Coverdell education savings accounts. That may sound bizarre. After all, why would anyone use a retirement account to save for education expenses when there are special accounts specifically designed to help plan for education costs? Here are some reasons why it may not be as crazy as you think.

Caregivers generally tend to their elderly/disabled family members as a labor of love, but it can also be taxing for them financially and otherwise. These 11 tips can help you manage the financial side of caregiving and keep things under control.

Becoming a caregiver to a family member or loved one will probably occur at some point in your life, whether it’s due to unexpected circumstances or old age. If you already are a caregiver or know someone who is, you may have some stories about how overwhelming it can be—emotionally and otherwise. Caregiving requires love, time, and patience, but the financial aspect of caregiving often doesn’t get the proper attention it needs.

Studies show caregiving duties begin to take up more and more time as caregivers age. Fortunately, resources are available to help caregivers and their loved ones manage housing, budgeting, driving, and more.

Although many people take it on with grace and generosity, extended caring for an older parent or someone who’s chronically ill can wear away at the caregiver’s vitality, finances, and even career growth. It also can be an overwhelming source of stress, especially as the caregiver ages.

How do you know when loved ones are ready for assisted living? Use these guidelines to help spot the warning signs of aging and illness.

Rosalyn Carter once said: “There are only four kinds of people in the world—those who have been caregivers, those who are currently caregivers, those who will be caregivers, and those who will need caregivers.” In light of the longer lives we now enjoy, it’s very probable that many of us, at one time or another, will have to provide support for an aging parent or relative.

An integrative caregiving plan can help you contain costs and take advantage of the various planning and health care resources available.

The wild card in any financial plan is the length and severity of the aging process. Longevity coupled with incapacity can decimate a family’s resources, forcing adult children to not only forego their inheritance but also contribute to their parents’ support to the extent that their own retirement security may be in jeopardy.

For most, it is difficult to think about the possibility of needing long-term care. But many will need it. Start the discussion and prepare yourself now, so you do not face a financial challenge later.

Long-term care planning—if not now, when?
Two big questions loom as the American population comes of age for long-term care—How do I plan for it? Can I afford it?

When it comes to planning for a safe and secure retirement, long-term care (LTC) can be a confusing and unaddressed challenge to many people’s financial security. Some of the hesitancy can be pinned to human nature—we don’t like to think about the unpleasant possibility of needing help being fed, bathed or using the bathroom. Some might think it won’t happen to them. Others can’t think that far down the road.

Nobody looks forward to discussing finances and elder care with their parents, but every family needs to do it. These tips will help you start the conversation now and get a plan in place before you urgently need it.

Most of us have always thought of our parents as the people who took care of us. We didn’t need to know how much money they earned or when they ate meals. But now, things are changing. Statistics show that currently about one-third of the adult U.S. population is providing care for another adult. That number is only going to grow as the population ages and life expectancies increase.

One day you may find yourself involved in guardianship proceedings for an elderly parent or relative. Here’s an overview of what guardianship means today, how the court evaluates the adult, and what you need to know.

Guardianship promises to be a huge issue facing baby boomers in the years ahead, as they watch over elderly parents—often from a distance—and wonder if the time has come to take control of mom or dad’s affairs before something bad happens. In years past, the effort to obtain guardianship of an incapacitated adult was often an ugly, acrimonious process that stripped elderly people of virtually all of their rights. If a court determined that an older person was confused and couldn’t pay his or her bills or make independent decisions, a guardian was appointed to handle all of that person’s affairs and make decisions for him or her.

Elder fraud continues to be a growing problem with millions falling victim to a scam every year. Know the common signs that signal trickery—and what to do if you or a loved one is being scammed.

Over two million elderly people are known to fall victim to elder fraud every year. The elderly population has long been a target of fraud for many reasons. For one, many are trusting and may have decreased cognition stemming from health issues. Scammers are also aware that many of these people have retirement accounts with money to spare—or conversely, are on a budget and likely to jump on a chance at a windfall.

A few years ago, I was sitting down to dinner with my family when I got a phone call from a department store inquiring about my new credit card and recent purchases. I knew right away I had a problem because I’d never shopped at that store.

As a small business owner, you have a lot on your plate, but you need to start educating yourself on another issue threatening businesses.

As a small business owner, you have a lot on your plate, but you need to start educating yourself on another issue threatening businesses.

Identity thieves have branched out. They’re not just after individuals anymore—businesses are the new target for hackers and fraudsters.

You are not the only one who needs to be on guard about their personal data safety. Minor children are 35 times more likely than adults to suffer ID theft. Here’s what parents need to know.

The latest target of identity thieves is not you, but rather your children. With little to no financial history, minors make an unsuspecting and easily exploited target. According to a Child Identity Fraud Survey conducted by Javelin Strategy and Research, one in 40 households has had one child who has suffered from identity theft. In fact, children are affected by identity theft and fraud 35 times more frequently than adults.

With data breaches occurring more and more, it is important to protect personal information stored in online accounts with secure passwords. The majority of passwords do not pass the test. Learn how to create a password that will keep your data safe online.

Would you rather wash the dishes than create a new password for an online account? If you chose the dirty dishes, you are not alone. According to a study by Harris Interactive and Janrain, 38% of those surveyed would prefer doing household chores over creating a secure username and password combination. And when we finally sit down to create these passwords, we don’t seem to be that good at it.

Cyber-attacks are launched at us every day. Do you know the warning signs that your security has been compromised?

With cybercriminals constantly prying at your door, it can be tough to know if one of them had gotten through your cyber-defenses.

Weekly, we hear news of data breaches exposing our personal records and putting our accounts in danger. In a recent year, the Identity Theft Resource Center estimated that 170 million records were stolen. A study by Bankrate found that 41 million Americans have been victimized by identity theft.

The latest data breach may have you worried about your personal information. Learn about a simple step you can take to protect your identity today.

The latest data breach may have you worried about your personal information. Learn about a simple step you can take to protect your identity today.

The headlines come at us constantly—143 million records leaked at Equifax, one billion exposed in a Yahoo breach, and 110 million records compromised at Target. After each new “unprecedented” hack, you’re rushed into a free credit monitoring program that promises to watch your files and alert you to any unusual activity.

The American Revolution was a gambit underpinned by iconoclastic ideas, unwavering principles, and tenacious effort. This July Fourth, let the example of the founding patriots inspire your own success.

10 Quick LinkedIn Tips and Tricks for CPAs

50 Things: What a Financial Professional Does for You

There are eight common money behavior patterns or “archetypes” battling it out in every investor. Being aware of your unconscious attitudes and behaviors toward money can give you an edge in managing your finances.

Whether you are a parent or a grandparent, your new little bundle of joy will be “dear” in more ways than one. Here’s how to plan for the financial to-dos and priorities of new (grand) parenthood.

Births, deaths, marriages, and divorces are significant life events that require financial resources and planning. Of all of these, a new baby is one of the most joyful, as parents and grandparents share their hopes and dreams as the birth comes closer.

When planning for the financial aspects of parenthood, it’s wise to be as proactive as possible. There are many expenses to consider, so take some time to consider the long-term implications of parenthood and put together a budget that will allow saving for future expenses.

Most baby boomers will face seven key events in their last stage of life that will color their finances and investments. Prepare for these events by thinking about them now.

It can be dangerous to generalize about the baby boom generation, but there are seven key events that nearly everyone will face as they move through the last third of their lives. Unlike earlier, happier events such as getting married, having children, and moving up the career ladder, some of these events may be anticipated with dread. For this reason, many boomers may put off facing them. But lack of preparation can make a bad situation even worse.

Key Financial Data 2025

Divorce is never easy, but collecting information and thinking through some of the issues before you even meet with an attorney can help you move through this life transition as smoothly as possible. Here’s a checklist outlining the information you’ll need to gather and why.

Divorce can be devastating—both emotionally and financially—for the unprepared. However, getting some financial help early in the divorce process can make the ordeal easier on you and your loved ones. Pre-divorce financial planning can help lower legal costs and increase the likelihood that you and your former spouse can reach a workable settlement.

The decision on whether to sell or rent your home is trickier than other financial decisions because of the emotional ties you have to your home. To make the best decision possible, evaluate the income, growth, and tax advantages of selling vs. renting and how it would advance your long-term goals.

If you are relocating due to a job change or retirement, you may want to keep your present home and rent it out rather than selling it and transferring the equity to a new home or reinvesting the proceeds.

The first question to ask is yourself is why are you considering this strategy? Here are some of the more common reasons: