FINANCIaL
FIELd NOTES
Navigating the Tax Torpedo: The Rising Taxation of Social Security
Many of my clients who retire in the early to mid-60s, will find that they are solidly in the 12% bracket even if they have a considerable nest egg of $1-$5M saved in retirement accounts.
For individuals in the 12% marginal income bracket, a less-discussed aspect of taxes is the Social Security "Tax Torpedo" – a phenomenon where the portion of your Social Security benefits that becomes subject to taxation increases as other income is realized…
Choosing Between a Springing or Durable Power of Attorney Document
A proper estate plan includes a Financial Power of Attorney (POA) document, that dictates who will manage your finances on your behalf in the event you are unable to do so. While these documents typically come into play toward the end of life when a personal physical and mental capacity diminishes, these are occasionally used in other circumstances like sudden disability or when traveling with limited access to the internet.
However, not all POAs are the same. There are two main types…
The Risks of High-Dividend Investing
A few years ago I was asked by a client if we should consider moving a significant portion of their stock investments into dividend-paying stocks. I can understand their perspective – the promise of regular, consistent dividends can be tempting, especially for retirees on a mostly fixed budget. For example, a retiree who owns $1,000,000 of ABC high-dividend stock fund that pays them $50,000/year in dividends can provide a sense of security.
However, investing in companies solely for their high dividend can introduce a number of risks that investors should be aware of…
What I'm Teaching My 6-Year-Old About Money
Zeke, my oldest child, just turned 6! This has been a special year as I watch him take an interest in some of my earliest childhood activities – climbing trees and making forts, building slingshots from broken branches, and turning any simple activity like taking the trash out into a race.
One of the things we have been working on in the past few years is that it’s okay to wait. Delaying gratification makes whatever you are enjoying all the better because of the wait…
Making Sense of Medicare, Part 2 – The Cost
Last week, in Part 1, I reviewed the 5 pieces to Medicare and the two main ways to get Medicare coverage. This week, in Part 2, I will outline the cost for the two routes to get Medicare. With Medicare open enrollment around the corner (starting October 15th), now is a good time to review your coverage and consider any changes…
Making Sense of Medicare, Part 1 – The 5 Pieces
Medicare is a confusing topic to navigate, in part because there are so many choices. In the first part of this series, I will discuss the various parts of Medicare. Next week I will discuss the cost of putting these pieces together.
There are 5 pieces to Medicare…