wealth management

Ahead of the Curve: Financial Planning for Early Retirement Success

There are many factors outside our control that can impact our retirement timeline – economic volatility, new legislation, or even a global pandemic – all of which can throw us off course enough that even the most well-planned retiree must make changes. This is part of what makes early retirement so challenging, so it ends up being a dream that fewer and fewer people manage to achieve. In fact, polling shows that American workers are retiring at later ages than they have in the past three decades. Still, achieving early retirement is not an insurmountable task. With careful financial planning and discipline, it can become a reality. If you are dreaming of leaving the workforce early, below are ten strategies to help you with financial planning for early retirement so you can stay ahead of the curve.

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How to Donate Stock to Charity

5 Steps to Combine Your Tax Planning and Charitable Giving Goals

Are you passionate about sharing your financial resources with causes and organizations you care about? Do you find meaning in creating an impact in the world? If so, consider how you might donate stock to charity to accomplish both your charitable giving goals and smart tax planning, too.

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Five Tips to Start Building Generational Wealth for Your Family

What You Need to Know to Secure Your Family’s Financial Future

Many of the world’s wealthiest people didn’t get there on their own—they inherited their fortunes from family members who had focused on building generational wealth. With the right strategy and planning, this type of financial legacy is within your reach, too. If you make wise decisions, you can build a solid foundation for yourself, and for your future family members, too. The five tips below can help you plant a seed that can grow for years to come.

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The Disadvantages of DIY Financial Planning

Avoid Challenges and Maximize Opportunities by Using a Professional Planner

If you’re someone who takes pride in making your own way in the world, you’re likely wired to feel inspired by the idea of DIY financial planning. It might feel practical to you, or even like the thing you “should” do – crafting your own unique strategy in pursuit of your money goals. However, DIY financial planning may not allow you to take full advantage of the tools available to you – meaning you could also be missing out on another level of financial security and peace of mind.

As you consider your financial plan, be aware of the challenges below that come with choosing to go it alone rather than working with a professional financial advisor.

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Millennials with High Salaries Should Consider These Financial Moves

Set Yourself Up for Future Success by Making the Most of Your High Income

If you’re a Millennial and you’ve found yourself with a high-earning job, you may be considered a HENRY, which stands for High Earner, Not Rich Yet. Coined by Shawn Tully in 2003, the acronym refers to a group of people who, despite making a lot of money, have not yet built their wealth and may need some guidance to take full advantage of their high salaries. Many HENRYs find themselves worried about achieving true financial stability due to high tax rates, a cost of living that continues to skyrocket, and a savings account that needs more attention.

Here are some financial planning moves you should be making if you’re a HENRY and looking to make the most of your high income.

Invest, Invest, Invest

First and foremost, you should be contributing to your workplace 401(k) account. Many employers offer to match employee contributions, so at the very least try to contribute enough to get any employer match available to you. Failing to do so means leaving money on the table – sometimes a significant amount.

In addition to your 401(k), consider opening a personal Individual Retirement Account (IRA) for yourself so that you can start making contributions there as you grow in your career, too. Currently, the annual IRA contribution limit is $6,000 per year, which can be a valuable boost to your retirement savings.

If you’re contributing to both your 401(k) and an IRA and you still have some disposable income on hand, consider building an investment portfolio for yourself, too. Think about opening a taxable brokerage account so that you can begin investing in stocks, EFTs, index funds, or mutual funds. As a millennial, you have the ability to take on more risk with your investment portfolio since you have decades ahead of you to cushion any market volatility your investments might experience. Though, if you’re nervous about taking on risk, index funds are a solid starting point. Broadly diversified index funds allow for you to invest money into many companies at once with low fees and  significantly less risk than investing in a single company.


SEE ALSO: Stock Options 101: What You Need to Know About ISOs, NQSOs, and Restricted Stock


Investing can be complicated when you’re new to it, so if you’re unsure where to begin or how to go about building a portfolio, you may want to consult with a professional you trust to help you determine the best options for your situation.

Lower Your Taxable Income

Building out a smart tax strategy is crucial for high-income earners of any age, millennials included. Luckily, there are tried and true strategies out there that you can use to help reduce your taxable income so that you can put those savings towards other long-term financial goals you may have.

The best way to be sure that you’re being smart with your tax strategy is to work with a professional who understands the ins and outs of ever-changing tax laws. However, investing money into your 401(k) and IRA accounts can be an easy way to lower your bottom line, as contributions to retirement accounts can typically be deducted from your taxable income.

Another valuable way to lower your taxable income while also putting money away for your future is to open a Health Savings Account (HSA). HSAs are a fan favorite because they come with a triple-tax benefit: you can contribute funds tax-free, the money in your account grows tax-free, and any withdrawals you make from your account are tax-free – so long as you’re using the funds to pay for qualified health expenses. Note that you do need to have a high deductible health plan (HDHP) to qualify for an HSA. If you do qualify, it’s a valuable tool to take advantage of.

Develop a Strong Retirement Strategy

Along with a smart tax plan, you should also have a comprehensive retirement plan in place to help you stay on track to meet your future goals. If you’re fortunate to have a high salary, it’s important that you’re making the most of your income by setting yourself up for future success. Working with a professional advisor to develop a retirement strategy that addresses your unique values, goals, and dreams for the future can give you the confidence that you’re on the right path as you move through your career.


SEE ALSO: Effective Strategies for Early Retirement


Find a professional you trust and talk with them about what your dream retirement looks. This will help you and your advisor determine how much you’ll want to save to support that retirement lifestyle. They’ll be able to help you solidify what steps you should be taking at which points in your life to make those dreams a reality. Often, HENRYs are able to save much more than they need to for retirement, which means they also have a great need to plan for the disposition of their estate to their chosen beneficiaries. And while leaving a legacy behind is a great feeling, you may also end up realizing that you could have enjoyed more of life than you had realized.

Work Smart, Not Harder

As a millennial earning a high income, you’re most likely in a place where you can begin making big financial moves outside of the basics like having an emergency fund in place that allows for you to build some real wealth for yourself and your family. Getting smart about investing your money and lowering your taxable income can give you even more money to work with as you begin tackling your long-term financial goals. It can be especially helpful to work with a financial advisor to make sure you’re utilizing the best options and resources available to you in your unique situation.

At Wade Financial Advisory, our team of advisors are committed to taking care of what’s important so that you can focus on what matters most to you. We understand that your financial needs will change throughout your life, and we provide a high level of care and attention through personalized, relationship-based services. If you feel that you might benefit from speaking with one of our professionals about your financial plans, please contact us today.

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Money Moves to Make in a Down Market

7 Tips to Help Your Investment Portfolio Stay on Track During a Downturn

When the economic climate takes a turn for the worse, it can be nerve-wracking for investors. But fear not—there are smart money moves to make in a down market. If you have significant assets in play, market declines can put your hard-earned wealth at risk, yet they also present a unique and interesting opportunity for those who are well informed. Markets usually recover, and while jumping ship at the lowest point may help quell your nervousness, it can also mean your wallet could end up leaner than you’d like. So, read on for the tips you can use to prosper even when the market is not.

1. Boost Retirement Contributions

Boosting your retirement contributions, especially if you have a matching contribution from your employer, is a great idea no matter the market circumstances. But it can be a particularly good idea to up your retirement savings when the market is down, especially for younger investors with longer time horizons. That way, when the market does recover, your investments can flourish.

2. Take Stock of Your Stocks

One advantageous money move to make in a down market is rebalancing your portfolio. If you’ve been relying on a certain investment mix to work for you in a thriving market, switching things up could help you stay ahead. If you’re close to retirement, consider transferring more of your assets to more stable investments like CDs and bonds. If you’re just starting out with investing, you should look at strategically investing in the stock market.

Wherever you are in your investment journey, it’s always a good idea to reexamine your portfolio to make sure you have a healthy mix. Diversifying your investments is one of the best ways to reduce your risk.

3. Maximizing Tax Losses

Tax-loss harvesting can help when the market isn’t going the way you hoped, but only if you’ve experienced an investment loss. The next step: writing off those losses on your tax return. It’s a solid strategy to consider in order to reduce your tax burden when the economy isn’t cooperating. It’s important to note that you can buy back your investments after selling them, but you have to wait at least 31 days to avoid violating federal regulations.


SEE ALSO: Investing 101 for Beginners


4. Consider Roth Conversions

When you’re experiencing market growth and your investments are at top value, converting from a traditional taxable IRA to a tax-free Roth IRA means you’re likely on the hook for a significant amount of taxes. During a decline in the market, however, that’s not the case. You can save some significant money during a Roth conversion because the value of your investments isn’t as high, meaning you will pay much less in taxes. It’s even more advantageous if your income is also lower than it normally would be.

5. Give and You Shall Receive

If gifting assets to your friends or family members is something you’ve considered, you may want to think about making that move during a market downturn when assets are valued lower than usual. The one catch: you have to be fairly confident that the assets will appreciate when market health returns. Being strategic when considering giving assets away can be a very good way to ensure your loved ones can make the most of your gift.

6. Make Money Work for You

If looking at your portfolio is making you more stressed than satisfied, it’s probably time to shift your attention to something you can control: your goals. It’s one of the best money moves to make in a down market. Depending on your situation, it might be smart to take a look at your investment portfolio’s goals, timeframe, and objectives. Take a look at whether or not your documentation is up to date, and update what you need to.

If you have a big expense coming up or a big milestone like retirement, you may be thinking about how your investments can be maximized in the short term. That makes it all the more important to track your goals and reassess your investments to ensure you stay on track.


SEE ALSO: Portfolio Change to Balance Market Opportunities and Risks


7. Embrace the Inevitable

Market downturns are inevitable, but you have control over both your strategy and your mindset. When you’re investing, it’s easy to get discouraged by an unexpected swing, but it’s important to remember that history shows us that your investments will likely still be successful and grow steadily over time.

Are You Making the Right Money Moves in a Down Market?

Just like you should be on the lookout for good investments when the market is performing well, you should also be ready to embrace the downturns when they come. By being prepared, you may just find that you can take advantage of a great opportunity.

At Wade Financial Advisory, our experienced team of professionals is ready to help you build a portfolio that is designed to achieve your goals while moderating risk – regardless of current market conditions. If you’re interested in learning more about our investment management services, please reach out to us today.

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529 plan

Multi-Generational Planning: Funding a 529 Plan for Your Grandchildren

A college education does not come cheaply. Forbes has estimated that the price of a college education has increased 8 times faster than wages, making it important for families to plan ahead in order to fund educational expenses. At Wade Financial Advisory, Inc. (WFA), we routinely discuss the benefits of establishing an Education Savings Plan account (commonly known as a 529 plan account) with our clients.  These accounts provide a cost-effective way to benefit the future generation because grandparents and other family members can easily contribute to a child’s existing 529 plan account. Setting up a 529 plan account as early as possible and adding funds to the account regularly allows for maximum growth opportunity.

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certified financial advisors

What You Should Know About Certified Financial Planners

Certified Financial Planners™ (CFP®) can stand out from a rather crowded field of financial professionals for a variety of reasons. One of the most important reasons is that Certified Financial Planners™ are mandated to act as a fiduciary, meaning that they are required to put their client’s interests and needs ahead of his or her own. Another reason why CFP® professionals stand out is the requirements necessary to become a CFP®, including a Bachelor’s degree and work-related experience. The exam for CFP® professionals is quite stringent and usually takes around 10 hours to complete. The CFP Board also imposes ethical standards on all licensees, and all those certified are required to complete continuing education courses in order to maintain their certification.

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