Worried about the direction the financial markets have taken over the past few months? You’re not alone. After nine consecutive years of growth, the markets ended 2018 on a down note. The S&P 500 finished the year down more than 6 percent, the first time it has ever finished a year negative after being positive through the first three quarters.1
In fact, some indexes have already entered bear market territory. The Nasdaq dropped more than 23 percent from its Aug. 29 high. The Wilshire 5000 and Russell 2000 also dropped more than 20 percent from their respective peaks in early September.1 If you’re approaching retirement, these losses could be stressful. When you’re younger and just starting your career, you have time to absorb losses and recover. That may not be the case if you’re only a few years from retirement. You’ll soon need to use your assets to generate income. A substantial decline may force you to delay retirement or make cuts to your planned lifestyle. Fortunately, there are steps you can take to protect your nest egg and your retirement. Below are three tools that can help you reduce your exposure to downside risk. Talk to your financial professional to see how these may play a role in your financial strategy. Fixed Indexed Annuity When it comes to investing, risk and return usually go hand in hand. Those assets that offer the most potential return often come with the highest exposure to risk. Assets that have little risk also offer little potential growth. It’s difficult to find growth opportunities that don’t have downside market risk. There are some tools available, though. One is a fixed indexed annuity. In a fixed indexed annuity, allows your money the potential to grow on a tax-deferred basis. The potential growth comes in the form of interest credited to the contract typically anually. Your interest credited each year is based on the return of a specific external index, like the S&P 500. The better the index performs in a given period, the higher the potential for the interest credits, up to a certain limit. If the index performs poorly, you may receive less or zero interest, but your contract won’t decline in value. Fixed indexed annuities have guarantees* on the value of the contract. That means you’ll never lose premium because of market declines. A fixed indexed annuity could be an effective way to plan for retirement income without exposing yourself to market risk. Deferred Income Annuity Are you concerned about your ability to generate retirement income in the future? Or are you worried that your retirement income isn’t guaranteed*? A deferred income annuity, also known as a longevity annuity, could be an effective option. With a deferred income annuity, you contribute a lump-sum amount and pick a date in the future to begin receiving income. At the specified time, the annuity company will begin paying you an income stream that’s guaranteed* for life, no matter how long you live. Work with your financial professional to project your income and see if a deferred income annuity can help you fill any gaps. Life Insurance You’ve probably purchased life insurance at some point in your life with the goal of protecting your spouse, children or other loved ones. Life insurance is a highly effective protection tool, but it can also do more. Some life insurance policies have a cash value account. Each time you make a premium payment, a portion goes into the cash value. Those funds grow on a tax-deferred basis over time. The growth usually comes in the form of dividends or interest, depending on the policy. You can also use the life insurance policy to generate tax-free income in retirement via loans or withdrawals. If you have a life insurance policy, you may want to explore how you can use it to achieve low-risk, tax-deferred growth and possibly create supplemental income in the future. Or you may want to look at new policies and see how they can help you protect your assets. Ready to protect your nest egg? Let’s talk about it. Contact us at DSM Financial. We can help you analyze your needs and develop a plan. Let’s connect soon and start the conversation. 1https://www.nasdaq.com/article/is-a-recession-coming-heres-how-to-survive-cm1081931 *Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values. Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency. 18412 - 2019/1/16
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Volatility on Valentine’s Day: How Couples Can Overcome Disagreements About Investment Risk2/12/2019 Valentine’s Day is supposed to be a day for romance and reconnection. For many couples, however, this time of year could be marked by disagreements about money. Nearly half of all married couples argue about financial issues.1
With the new year just starting and tax season right around the corner, many people use this time to evaluate their spending, earnings and financial performance over the previous year. That analysis could reopen sore spots about money management. The performance of the financial markets over the past few months could also be a source for disagreement among couples, especially those who have differing investment styles. After starting strong for the first three quarters of the year, the S&P 500 finished with an epic meltdown in the fourth quarter. The index ended the year down 7 percent, the first time in history it’s finished the year negative after being positive for the first three quarters.2 Do you and your spouse disagree about investing styles? Does one of you take a more aggressive stance while the other prefers to play it safe? Below are a few helpful tips on how you and your spouse can meet in the middle and get past your investment-related disagreements: Draft an investment policy statement. Many couples disagree about their investment approach because they’ve never developed a formal investment strategy. They generally know they want to save for retirement, but they’ve never discussed their specific objectives or tactics. An investment policy statement does just that. Your investment policy statement is a written document that states your goals, acceptable risks and the steps you will take to reach your objectives. It outlines which types of investments are appropriate for your strategy and which are not. You can use your investment policy statement as a guide for making future decisions. The process of developing the investment policy statement could be beneficial for many couples. You’re forced to share your differing opinions and compromise to reach a strategy. Those conversations could help you work out differences and find areas where you agree, which could diffuse future arguments. Develop a retirement income plan. Often, arguments are fueled by uncertainty about the future. You’re unsure of when you’ll be able to retire or how much more you need to save, so that heightens your anxiety and sharpens disagreements. You may be able to avoid arguments by eliminating the uncertainty. Work with your financial professional to develop a retirement income plan. You can project your future retirement income from sources such as Social Security, an employer pension and even your own savings. You can also build a retirement budget to estimate your spending. These two projections should give you an idea of how close you are to reaching your goals, how much more you need to save and how much risk you should take to achieve growth. Don’t avoid the conversation. Have you and your spouse agreed to disagree about your differing investment styles? Do you avoid the conversation? Or do you go it alone with your individual accounts so you don’t have to discuss issues that may lead to disagreement? While you may not want to disagree or argue, it’s also not helpful to avoid the conversation. If you each have differing styles and don’t have a cohesive plan, you could be missing out on opportunity. For example, assume your spouse is aggressive with his or her investment style and takes on a substantial amount of risk. Perhaps you’re conservative and choose assets that offer little return potential but also have little chance of loss. You may feel that the “go it alone” approach works because you each invest according to your comfort level and you avoid arguments. By avoiding the conversation, however, you may be missing out on opportunities to meet in the middle and achieve better performance. For example, you could find an allocation that has growth potential and reduced risk. You could use tools such as annuities that offer growth without downside exposure. The only way to find these opportunities is to discuss your differing approaches and look for middle ground. Work with a professional. Finally, you may find it helpful to bring in a third party, like a financial professional. They can give objective, impartial feedback and also provide information and analysis that may change your approach. They can also help you develop a retirement strategy and an investment policy statement to guide your decision-making. Ready to overcome your investment disagreements with your spouse? Let’s talk about it. Contact us today at DSM Financial. We can help you analyze your needs and implement a plan. Let’s connect soon and start the conversation. 1https://nypost.com/2017/08/03/the-reasons-most-couples-argue-about-money/ 2https://www.cnbc.com/2018/12/31/the-sp-500-will-make-history-when-it-ends-the-year-with-a-loss.html Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency. 18408 - 2019/1/14 It’s that time again. A new year is here, which means a volatile 2018 is in the rearview mirror. The markets suffered a steep drop at the end of last year after climbing steadily through the first three quarters. A number of factors contributed to the markets’ fourth-quarter tumble, including tariffs, interest rate hikes and trouble in the tech sector.
A new year doesn’t mean those challenges are gone, but it does represent a fresh start. And if history is any guide, January can be a strong month for investors. According to a study from LPL Research, in the 68 years from 1950 through 2017, January has been a positive month for the S&P 500 41 times. It’s been negative 27 times.1 As any investor knows, history doesn’t guarantee future performance. However, there does seem to be a correlation between market performance in January and the rest of the year. How do January returns impact the rest of the year? According to LPL Research, there’s a relationship between January returns and market returns over the remainder of the year. Its research showed that during years in which there was a positive January return, the market had an average return of 12.2 percent over the next 11 months. When the January return was negative, the S&P 500 returned only 1.2 percent the rest of the year.1 If January returns are more than 5 percent, the correlation is even more pronounced. In those years, the market had an average return of 15.8 percent over the next 11 months. In fact, when January has a return of more than 5 percent, the rest of the year is positive 91.7 percent of the time.1 What is the January effect? Why has January been positive more often than not? And why does January’s return seem to impact the rest of the year? There are no definitive answers to these questions, but there are theories. There’s an idea called the “January effect,” which suggests that January returns may be the product of tax strategy. Investors sell stocks in December to harvest tax losses before the end of the year. That depresses prices and creates a buying opportunity in January. Because investors sold at the end of the year, there’s cash on the table to buy in the beginning of the next year. Of course, this is just a theory. There’s no way to conclusively prove whether the January effect is a real phenomenon. Even if it could be proved, it’s never wise to change your long-term investment strategy based on short-term opportunities. If you’re concerned about the volatility in 2018 or the coming year, now is a great time to meet with a financial professional. They can help you review your strategy and possibly make changes that reduce your risk exposure and allow you to take advantage of opportunities. Ready to evaluate your investment strategy? Let’s talk about it. Contact us today at DSM Financial. We can help you analyze your needs and goals and implement a plan. Let’s connect soon and start the conversation. 1https://www.thestreet.com/story/14469889/1/stock-market-s-strong-january-performance-bodes-well-for-the-rest-of-the-year.html Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency. 18345 - 2018/12/31 A new year is here, and with it comes a flood of year-end tax documents like W-2s, 1099s and others. Before you know it, the April 15 tax filing deadline will be upon us, and it will be time to submit your return.
It’s always wise to meet with your financial professional at the beginning of the year. It gives you an opportunity to discuss the past year, your goals for the coming year and your tax strategy. However, a consultation with your financial professional could be especially helpful this year. The Tax Cuts and Jobs Act was signed into law in late 2017 by President Trump. While some of its changes went into effect last year, 2018 was the first full calendar year under the new law. The return you file in April will likely be the first that reflects much of the law’s changes. Below are a few of the biggest changes and how they could affect your return: Increased Standard Deduction The new tax law impacted a wide range of credits and deductions, from the deduction of medical expenses to credits for child care. Those who itemize deductions may have felt the brunt of these changes. However, the tax law significantly increased the standard deduction. In 2017 the standard deduction was $6,350 for single filers and $12,700 for married couples. The new law increased those numbers to $12,000 and $24,000, respectively.1 Given the changes to itemized deductions and the increased standard deduction, you may want to consult with a financial or tax professional before you file your return. If you’ve traditionally itemized deductions in the past, that may no longer make sense. New Tax Brackets The new tax law also made significant changes to the tax brackets. There are still seven different brackets, just as there were before the passage of the law. And the lowest rate is still 10 percent. The top income tax rate is down to 37 percent, however, from 39.6 percent.2 There are similar cuts throughout the rest of the brackets as well. The law also made changes to the income levels for each bracket. Generally, the bracket levels were increased throughout the tax code, which means you have to earn more before moving into a higher bracket. Under the old tax code, for example, a married couple earning $250,000 would be in the 33 percent bracket. Under the new law, that same couple would be in the 24 percent bracket. A single individual earning $80,000 would be in the 28 percent bracket under the old law but is now in the 22 percent bracket.2 Itemized Deduction Changes As mentioned, the new tax law increased the standard deduction amounts. However, those increases came at the expense of many itemized deductions. The new law eliminated or reduced many common deductions, including those for state and local taxes, real estate taxes, mortgage and home equity loan interest, and even fees to accountants and other advisers. However, there could be other opportunities to boost your itemized deductions above the standard deduction level. Charitable donations are still deductible, as are medical expenses assuming they exceed the 7.5 percent threshold. If you’re a business owner, you can deduct many of your expenses, including up to 20 percent of your income assuming you meet earnings thresholds.3 Ready to review your financial and tax strategy? Let’s connect soon and talk about taxes and your entire financial picture. Contact us today at DSM Financial. We can help you analyze your needs and goals and implement a plan. 1https://www.nerdwallet.com/blog/taxes/standard-deduction/ 2https://www.hrblock.com/tax-center/irs/tax-reform/new-tax-brackets/ 3https://money.usnews.com/investing/investing-101/articles/know-these-6-federal-tax-changes-to-avoid-a-surprise-in-2019 Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency. 18326 - 2018/12/26 Retirement is America’s top financial concern. According to a study from Gallup, nearly 60 percent of Americans are worried that they won’t have enough money to retire comfortably.1 Are you a member of that group?
If so, the answer could be as simple as changing your mindset. A new study from Wells Fargo found that those who have a “planning mindset” are 42 percent less likely than those who don’t have a planning mindset to have high levels of financial stress. They also have 3.1 times more in retirement savings.2 How does one develop a planning mindset? Below are a few key steps you can take to change your financial mindset in 2019: Set short-term goals. Researchers found that individuals with a planning mindset are in the habit of setting goals. In fact, they’ve typically set a financial goal within the past six months. Have you done that? And have you taken steps to achieve those goals? Were you successful? If you don’t typically set goals, you may want to get in the habit of doing so. Start with something modest. Pick something that’s achievable but also meaningful. It may be making a regular contribution to a retirement account or paying off a small credit card balance. Once you achieve those small goals, you can move on to something bigger. Work gradually toward long-term goals. Short-term goals are helpful, but long-term goals are also important. Individuals with a planning mindset focus on the long-term. Try making your long-term goals as specific as possible. Don’t just say you want to retire. Instead, try to retire with a certain amount of savings by a specific date. You can then work backward to develop a plan to reach that goal. You also may want to break your long-term goals into manageable pieces. You may find the task of saving for retirement daunting. However, instead of focusing on the total goal, instead set an annual savings goal. By focusing on what you can do today, the goal may seem more realistic and doable. Save for retirement today. There’s no time like the present to save for your future. Individuals with a planning mindset know that time is one of their most powerful financial tools. If you contribute money now, you give those funds the opportunity to grow and compound over a long period of time, which can help you accumulate more assets before retirement. Even a modest contribution is better than nothing. Start by contributing just enough to get your employer match to your 401(k) or employer-sponsored retirement plan. Over time, gradually increase your contributions and also make contributions to an IRA. With compounded growth over a long period of time, you’ll see those contributions start to add up to a significant amount. Ready to adopt a planning mindset in 2019? Let’s talk about it. Contact us today at DSM Financial. We can help you establish goals and develop an action plan. Let’s connect soon and start the conversation. 1https://news.gallup.com/poll/233642/paying-medical-crises-retirement-lead-financial-fears.aspx 2https://www.businesswire.com/news/home/20181114005575/en Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency. 18280 - 2018/11/28 Are you considering making a sizable financial gift to a friend or family member? A financial gift can be a great way to make a difference in a loved one’s life. It can also be an effective estate-planning strategy, as gifting may potentially remove assets from your estate. That could reduce the amount of assets that face probate and the estate tax.
Gifting could trigger its own set of taxes, though. You may not know gift tax exists or how it works. Depending on the size of your gift, you could face up to a 40 percent gift tax.1 If you fail to pay the tax, the recipient may face additional tax obligations. How can you make your gift without creating additional tax liability? And how do you know if you should worry about the gift tax? Below are a few important facts to keep in mind as you develop your gifting strategy. Are you starting to think about your legacy and how best to pass your hard-earned assets on to the next generation? You may think that your legacy is something that is distributed after you pass away. However, the idea of early inheritance, or gifting money before death, is growing in popularity. In fact, according to a study from Merrill Lynch, nearly 60 percent of those age 50 and older say they would prefer to give assets to loved ones today rather than in the future.1 Fortunately, the IRS allows you to gift assets to your children, grandchildren, or just about anyone on an annual basis without facing gift taxes. Individuals can give up to $15,000 per year to each recipient while married couples can gift as much as $30,000. Also, gifts don’t count toward the exclusion if they’re used to pay for tuition or medical expenses.2 If you’re considering early inheritance, you may want to meet with a financial professional to develop a strategy and see how it fits with the rest of your plan. Even if you’re not in danger of hitting the gift tax threshold, there are still important points to consider. Below are a few questions to ask: What kind of impact could an early inheritance have for your family? One of your main motivations for giving an early inheritance may be that it’s needed urgently now. For instance, maybe you have a grandchild heading to college who could use his or her inheritance for tuition. Maybe you want to help a grown child fund retirement or overcome financial challenges. An early inheritance also gives you the benefit of seeing your assets put to good use. Although it may feel good to know that your family will receive a windfall after you pass away, you may find it more satisfying to see how they use that money while you are relatively young and healthy. Can you afford to give an early inheritance? Before you start writing checks, be sure that you won’t need the assets in the future. You may think you have plenty of money to fund your remaining years. However, there are potential costs in retirement that may cause unexpected challenges. Fidelity estimates that the average couple will need to spend $280,000 on health care in retirement.3 The U.S. Department of Health and Human Services estimates that 70 percent of retirees will need long-term care, which can often cost thousands of dollars per month.4 If you haven’t addressed these risks, you may want to do so before you implement a gifting strategy. Are there any personal or family issues to consider? Finally, consider what kind of issues your gift may have within your family. While your gift will almost certainly be welcome, there could be underlying issues and feelings that you haven’t considered. For example, have you provided financial help in the past to children or grandchildren? Will other children feel that the gift amount is unfair? Are there children or grandchildren who may not be able to handle the responsibility of a large windfall? These are important questions to consider. You want your gift to have a positive impact, not create conflict and tension. If there are risks associated with your gift, you may want to consult with a financial professional to develop a strategy. Ready to create your gifting plan? Let’s talk about it. Contact us today at DSM Financial. We can help you analyze your needs and implement a strategy. Let’s connect soon and start the conversation. 1https://www.ml.com/articles/why-make-your-heirs-wait.html 2https://www.irs.gov/businesses/small-businesses-self-employed/frequently-asked-questions-on-gift-taxes 3https://www.fidelity.com/viewpoints/personal-finance/plan-for-rising-health-care-costs 4https://longtermcare.acl.gov/the-basics/how-much-care-will-you-need.html Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency. 18274 - 2018/11/27 Think disability couldn’t happen to you? Think again. Disability is more common than many people assume. According to the Council for Disability Awareness, 25 percent of all adults will miss work because of disability at some point in their lives.1 Many employers offer disability coverage through a group benefit plan. In fact, you may think that you’re protected against disability because of your group insurance. However, group coverage often isn’t enough to minimize every threat. It’s possible that you may need a more robust individual disability insurance policy to fully protect yourself. Not sure whether you have the right coverage? Below are some of the key differences between group policies and individual policies. A financial professional can help you analyze your risk and develop a strategy. Cost Group disability coverage is usually less expensive than it’s individual counterpart. The risk is shared and distributed among many people and that minimizes the cost to each person. It’s also possible that your employer may pay some or all of the premiums. However, individual policies and group policies can’t always be compared evenly. Individual policies often have more robust protection. They may have different elimination periods or benefit amounts. You can often design a long-term disability policy to meet your needs and budget, so it may not be as costly as you expect. Benefit Amount Group disability policies usually pay your benefit as a fixed percentage of your income. While the benefit may be helpful, it’s unlikely to fully replace your income. It’s not uncommon for group plans to replace only half or 60 percent of income. Many group plans also have a maximum benefit that you cannot exceed, even if your income would generate a higher amount. With an individual policy, you may be able to receive a higher benefit amount. For instance, some may pay up to 80 percent or even 100 percent of your income as a benefit should you become disabled. Portability One of the biggest challenges with any employer-based insurance coverage is that the protection is tied to the job. If you leave your job, you lose the coverage. And there’s no guarantee* that your new employer will have a similar benefit. An individual policy stays with you, no matter where you work. As long as you pay the premium, you keep your coverage. Benefit Eligibility Perhaps the biggest distinction between group policies and individual policies is the way disability is defined. Many group policies cover only total disability or have an “any occupation” disability definition. That means you’re defined as disabled only if you can’t work in any occupation. With an individual policy, you can choose an “own occupation” definition. That means you simply have to be too disabled to work in your job, not any potential job. This is helpful if you work in a highly skilled field. For instance, if you’re a surgeon and injure your hand, you may not be able to work in your field even if you could perform other jobs. In that example, you would still get your benefit from an individual policy, but you may not get it from a group policy. Ready to protect yourself against disability? Let’s talk about it. Contact us at DSM Financial. We can help you analyze your risk and develop a plan. Let’s connect soon and start the conversation. 1http://disabilitycanhappen.org/disability-statistic/ *Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values. Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency. 18185 - 2018/10/22 The year is quickly drawing to a close. You may be busy wrapping up projects at work, planning your holidays, or even thinking about resolutions for 2019. This is also a great time to review your financial strategy. You can use this time to review the past year and identify areas for adjustment in the coming year. Below are a few important questions to consider as you review your retirement strategy. If you haven’t reviewed your strategy in some time, now may be the right time to do so. A financial professional can also help you look at your strategy with fresh eyes and identify areas for change. How much should you contribute next year? Do you use a 401(k) plan to save for retirement? If so, you’re not alone. The 401(k) is a popular and effective savings vehicle because it allows for tax-deferred growth and employer contributions, both of which can help you accumulate retirement assets. In 2019 the maximum 401(k) contribution increases to $19,000.1 If possible, look at your budget and see if you can increase your contributions. Even a small increase can have a big impact over time. You also may want to contribute to an IRA. You can contribute up to $6,000 to a traditional or Roth IRA.1 An IRA can offer additional opportunity for tax-deferred growth, along with other tax-favored treatment. Your contributions to a traditional IRA could be tax-deductible. Withdrawals from a Roth IRA after age 59½ are tax-free. Contributions to an IRA could help you reach your retirement savings goal. What’s the right allocation for you? It’s natural to become more conservative in your investment approach as you get closer to retirement. You have less time to recover from a market downturn. You may have less tolerance for risk and volatility. Discuss your allocation with your financial professional to see if you should take a more conservative approach. If you haven’t adjusted your allocation in several years, it may be time to shift to a more conservative strategy. You also may want to consider an annuity as part of your planning. Annuities offer a variety of ways to minimize risk. Some offer downside protection against loss and predictable interest payments. Others offer a guaranteed* lifetime income stream in retirement, regardless of market performance. Your financial professional can help you determine whether an annuity is right for you. Are you exposed to any risks? One financial emergency could be all it takes to upend your retirement strategy. You could face disability or significant medical costs. A job loss could disrupt your ability to save. Fortunately, you can use insurance to protect against many risks. Take a look at your protection strategy to see if there are any gaps. Do you have sufficient life insurance to protect your family in the event of your death? Are you protected against long-term disability? If you’re approaching retirement, have you considered how you might pay for future long-term care costs? Again, a financial professional can help you answer these questions and develop a strategy. Ready for your year-end review? Let’s talk about it. Contact us today at DSM Financial. We can help you analyze your needs and develop a strategy. Let’s connect soon and start the conversation. 1https://www.irs.gov/newsroom/401k-contribution-limit-increases-to-19000-for-2019-ira-limit-increases-to-6000 *Guarantees, including optional benefits, are backed by the claims-paying ability of the issuer, and may contain limitations, including surrender charges, which may affect policy values. Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency. 18184 - 2018/10/22 Long-term disability is an extended inability to work due to a physical condition. Disability can be caused by a broad range of medical issues like accidents, chronic pain and injuries, serious illnesses, and much more. If you suffer a disability and are unable to work, you could face steep medical bills along with the burden of funding your expenses while not receiving a paycheck.
You can minimize the financial risk of disability by using long-term disability insurance, which pays you a monthly benefit should you ever become physically unable to work. You can use the monthly benefit to pay bills and replace your lost income. The amount of the monthly benefit is often calculated as a percentage of your salary. Below are a few questions to ask as you shop for disability insurance. All of these questions involve features that impact the policy’s premium. If you can’t answer these questions, you may want to do more research before you commit to a policy. |
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