FINANCIaL
FIELd NOTES
My Retirement Checklist (Part 2)
Last week we discussed the foundation for your retirement - calculating in detail your income and expenses at various stages throughout retirement. This week, we will discuss how to evaluate whether your investment and tax plan are working toward your retirement goals. While working with a trusted and competent advisor can be helpful for all items of the retirement checklist, they can be especially helpful in the area of investments and taxes discussed below.
My Retirement Checklist (Part 1)
My family thrives on checklists because without them we would almost certainly head to the beach for a long vacation without sunscreen or our swim trunks. Preparing for retirement can feel a bit like a really long vacation, constantly wondering if there’s something you haven’t thought of. That’s why I created my retirement checklist to walk clients through as they prepare for retirement.
Doing Nothing Is Hard
“A genius is the man who can do the average thing when everyone else around him is losing his mind.”—Napoleon
Investing sounds easy in theory.
(1) design a portfolio based on goals and risk tolerance
(2) set guidelines for when and how changes should be made
(3) then get out of its way
As anyone who has been investing for some time will tell you, it is anything but easy.
Maximizing Your Charitable Deductions with a Donor Advised Fund
A few years ago, Congress passed legislation that changed the standard deduction, and with it, the way many people gave to charities.
Charitable contributions are an itemized deduction, as opposed to the standard deduction. So, if you don’t have enough itemized deductions to increase it over the standard deduction, there is essentially no tax benefit for your donation. This is where a Donor Advised Fund (DAF) comes in….
Why Sequence Of Return Matters So Much
Let’s pretend we have two retirees, Jim and Marty McFly. They both look the same financially. They are retiring in the year 2000 with $1,000,000, all invested in the S&P 500, and plan to begin withdrawing $40,000/year. The only difference is that Marty McFly has the ability to travel to 2020 and go do retirement in reverse…
Why I'll Never Find The Next Amazon
It sounds great in theory.
Step 1 - Find the next Amazon while it’s still a small and unknown company.
Step 2 - Hold it forever.
Step 3 - Make a bazillion dollars and retire on my own private island.
Let's go ahead and say I did the impossible and got Step 1 right. I say impossible because even Jeff Bezos wasn't sure it would become what it did.