Adaptive Markets book

Adaptive Markets

Adaptive Markets – Financial Evolution at the Speed of Thought by Andrew Lo is a deep dive into market theory. This book is not a surface-level read on retirement planning or investing. It provides insight into how markets operate and change over time. The takeaway from the book is enhanced understanding of market behavior. I …

Man Checking Asset Location

Asset Location is Important Too

That’s not a typo. Asset location is an often overlooked aspect of retirement planning. That is unfortunate because asset location can significantly affect the after-tax value of your retirement income. I’ll explain what asset location means and how you can use that information to increase your retirement income.

Woman calculating the five year rules

The Five Year Rules of Roth Distributions

Roth IRA’s are one of the most popular retirement accounts. Roth IRAs have many advantages over tax-deferred accounts, namely the ability to provide tax-free growth. The ability to provide tax-free growth is premised on making contributions with after-tax dollars. As I’m sure you are well aware, you must pay taxes on essentially each dollar you …

How to Make Your Money Last

How to Make Your Money Last

In How to Make Your Money Last – The Indispensable Retirement Guide, Jane Bryant Quinn provides an excellent comprehensive overview of retirement planning. If you want to understand the key areas that will affect your retirement this book is a good read. If you are managing your own retirement, or plan to, I highly recommend …

Bonds Chart

Bond Prices and Rising Interest Rates

Bonds are a common asset in retirement accounts. Whether held individually or through an ETF, most retirement accounts contain bonds. Bonds are most often held because of their relative safety over equities, and for income through their contractual obligations to pay interest. However, bonds still exhibit market risk that needs to be managed. Buying bonds …

Required Minimum Distributions

If you save for retirement using tax-deferred accounts then you need to understand the rules surrounding required minimum distributions (RMDs) in order to avoid some pretty steep penalties. For some retirees, the required minimum distribution is less than they would withdraw anyway, and is therefore not much of a planning concern. For others who intend …

4% rule of retirement income from nest egg

The 4% Rule of Retirement Income

The most commonly cited method of withdrawing retirement income from an investment portfolio is “the 4% rule”. This rule comes from a very popular study conducted by William Bengen and published in The Journal of Financial Planning in 1994 as Determining Withdrawal Rates Using Historical Data. The short-hand version of the rule, and the basic conclusion …

Implications of Tax Reform for Retirement Planning

Tax reform stirred up a lot of debate. Fortunately, the Tax Cuts and Jobs Act did not greatly modify the retirement savings vehicles that often house index funds and a variety of other investments. However,  prudent and intelligent investors will still want to stay educated about all of the tax bill’s implications to generate greater …

Is a Solo 401(k) Right for You?

As a self-employed solo entrepreneur, you need to save for retirement just like everyone else. However, you don’t have the benefit of a 401(k) retirement savings plan offered by an employer. It’s all on you to research, establish, and contribute to your own plan for retirement savings. Fortunately, the Internal Revenue Service (IRS) offers several …

403b vs 401k

403b vs 401k: Differences and Similarities

The primary difference between a 403b vs 401k retirement account is who uses them. A 401k is for people employed by a for-profit organization. In contrast, the 403(b) plan is for those who work for a non-profit organization. Some typical examples include teachers, members of religious organizations, and hospital employees. This is the key difference …

Roth IRA Contribution Limits

Roth IRA’s can be an excellent retirement saving vehicle. Roth IRAs allow you to save $6,00 per year towards retirement if you are under 50. People who are 50 or older can contribute a “catch-up” contribution of $1,000 each year for a total Roth IRA contribution limit of $7,00 per year. Unlike Traditional IRA’s and …

drinking latte thinking about long-term goals

Now or Later? Planning for Long-Term Goals

Have you thought about what you might be giving up by waiting to invest for long-term goals such as retirement? One of the greatest financial tools that young investors have is time. Time’s effect on long-term investment performance is much greater than financial savvy or a large income. So many younger would-be savers and investors …

Planning for a Dynamic, Non-Traditional, Retirement

There are several key points to consider if you’re interested in a non-traditional retirement or one involving a second career. With the booming innovation economy and rapidly expanding communication technology, people are no longer restricted to one career or even location. Traditional methods of financial planning focus on wealth and capital accumulation during the working …

Two Common Retirement Saving Pitfalls

In your twenties or thirties you know that you’ve got a number of years left in the workforce. How long do you want to work before traveling, learning to sail, or playing golf as a full-time job? How much would you like to save for retirement at age 50, 60, or 70? What would you do if you had the means to retire at 40? These are …

socially responsible mutual funds performance chart

Do Socially Responsible Mutual Funds Perform Well?

An important consideration of any investment strategy is the ability of the strategy to provide satisfactory results. Sustainable or socially responsible mutual funds and investment strategies are not immune to this line of investigation. Arguably, most investors who choose SRI investing likely emphasize the altruistic traits of the investments themselves over investment performance. However, even …

comparing IRA types

Traditional or Roth IRA?

So, you have decided to invest. Great. Presumably, you are investing for a purpose. Even better. If that purpose is for retirement you may have even spent time thinking about whether a Roth IRA or Traditional IRA is best. For 2017, Roth and Traditional IRA contribution limits both remain at $5,500. The key difference in …