Happy Autumn, Clients and Friends!

We hope that you and your family took some time to relax and make some special memories together this summer. At Return on Life^® Wealth Partners, we talk a lot about the importance of family. For myself, and each of our wealth advisors, family has played an influential role in our chosen career paths. Many of us were motivated by challenges our own families experienced during our formative years, or as our parents or grandparents entered retirement. It’s no coincidence that helping families plan for and accomplish the things that hold the greatest meaning and purpose in their lives, something we refer to as a life well lived, forms the foundation of our Return on Life^® philosophy.

Those words took on even greater meaning for me recently when I lost my father, Nello Fantozzi, at age 86, following a lengthy illness. While my dad had struggled with his health since February of 2020, he spent his last years in much the same way he spent his earlier life – surrounded by family. Family meant everything to Nello. It was one of three themes in the trilogy that defined his life, the others being friends and work. He was only 16 when his father, Sabatino, who worked in the Pittsburgh steel mills and sent money back to his family in Capistrello, Italy, brought Nello on his last trip to the U.S. and told him he would stay with his Zia Anna and make a new life here.

He later followed his brother Gino to Cleveland where there was more work. That’s where he met my mom Maria, who was pushing her younger brothers on a playground swing. The rest is 63 years of a memorable marriage to my mom and many cherished memories with family and friends. He worked hard to build a life for my mom, my brother, and me, and to ensure we would have access to opportunities that he never would. He passed his work ethic on to us, teaching us to do the job right the first time and to care for the people we come into contact with.

Along the way, he faced many obstacles, including an injury that not only threatened his livelihood but our family’s financial security. Despite these challenges, he held tight to his values and was a living example of what it means to put family first. And while we will miss his presence with his boyish smile, twinkle in his eye, and playfulness, we will continue to celebrate his life and the legacy he passed down to his children, grandchildren, and nieces and nephews. (Well, that and his homemade wine, and sausage. I’d be remiss if I didn’t mention those.)

While there’s nothing easy about losing a parent at any age, there’s tremendous solace in knowing that my dad’s life, despite the challenges, was truly a life well lived. My hope is that each of us can say the same about our own lives.

As you and your family continue to pursue your goals for a life well lived, we encourage you to reach out to your dedicated team whenever you have questions or when circumstances in your life change. If you need additional help or someone you know needs our advice, remember, we’re only a phone call away at 440.740.0130.

In the meantime, we invite you to spend a few minutes checking out the latest news about your team at Return on Life^® Wealth Partners, as well as our thoughts on the markets and economy with the elections nearly upon us.

What’s In It for You?

At-a-glance guide to your 3rd Quarter 2024 Frank Talk newsletter:

News & Events

• Team Updates
  • Ke Zhong, CFA^®, MSF and Stephanie Perrone join our team

Resources

• 2024 Federal Tax Rates Guide
• 2023-2024 Tax Planning Guide
• Complimentary Second Opinion Service
• Visit Our Blog and Podcast and Join Us on Social Media

Market & Economic Update

News & Events

Team Updates

Ke Zhong, CFA^®, MSF Joins the ROL Team

Join us in welcoming Ke Zhong, CFA^®, MSF to Return on Life^® Wealth Partners. Ke joined our team in August 2024. As a Chartered Financial Analyst (CFA^®), she supports our team and clients by conducting independent research and due diligence, and providing insight into equity valuation, risk management, alternative investments, tax-loss harvesting strategies, and portfolio performance attribution analysis. Prior to joining our team, Ke gained experience as a business and finance professional at Goldman Sachs, BrightEdge, and the world-renowned Cleveland Clinic.

Ke earned her Bachelor of Business Administration, Financial Management, with a minor in Accounting and Auditing from Nanjing Audit University in Nanjing, China in 2018. She attained her Master of Science in Management, Financial Mathematics, from the Weatherhead School of Management, Case Western Reserve University in Cleveland, Ohio, in 2020. She is a member of CFA Society Cleveland, which promotes professional development, ethics, and awareness through outreach to and engagement with the  financial community.

ROL Welcomes Stephanie Perrone

We were excited to welcome Stephanie Perrone to the Return on Life Wealth^® Partners team in June 2024. Stephanie joined us as Executive Assistant to the firm’s president and founder, Frank Fantozzi, CPA, MST, PFS, CDFA, AIF^®, CEPA. In addition to providing administrative support, Stephanie assists our growing team of wealth advisors and associates in maintaining the firm’s customer relationship management system, running reports, and implementing social media and prospect outreach initiatives.

Stephanie brings more than 20 years of experience in strategic planning and operational and administrative management, having worked closely with senior executives at a variety of businesses, including the American Endowment Foundation, Univision Communications, Inc., and TrendFund Corporation. She received a Bachelor of Arts in Radio, Television and Film from the New School for Social Research in 2000.

Recent Events

The 16th Annual Cleveland Economic Summit

We were excited to welcome so many of our clients and friends at our 16th Annual Cleveland Economic Summit, which was held on September 26th, at the Cleveland Botanical Garden/Woodland Hall. This year’s Summit featured two dynamic speakers, Andrew Medvedev, Dean at Case Western Reserve University (CWRU) Weatherhead School of Management (previously a managing director and portfolio manager at Morgan Stanley), and Brian Zimmerman, Chief Executive Officer at Cleveland Metroparks. Hosted by Frank Fantozzi, the Summit addressed topics impacting the local and national business environment and factors influencing your taxes, business and personal finances this election year.

If you were unable to join us or would like to revisit the discussion, you can access the live video recording from Mr. Zimmerman and his presentation slides using the links below:

Event Recording: Brian Zimmerman

Download Mr. Zimmerman's presentation slides

2024 Smart Business Family Business Conference

For the 8th consecutive year, we sponsored the Smart Business Family Business Conference & Achievement Awards on September 5th at Corporate College East in Cleveland, Ohio. Frank Fantozzi participated as a panelist where he joined fellow industry experts to provide insights to address some of the most pressing challenges family businesses face today.

Resources

2024 Tax Guides

As the year end approaches, remember that our tax guides are valuable tools for referencing 2024 year-end deadlines and other information about retirement plan contributions, charitable giving strategies, tax-loss harvesting, and more. Download one or both guides now:

• 2024 Federal Tax Rates At-a-Glance Guide – Your guide to 2024 Federal Tax Rates is just a click away! This at-a-glance guide makes it easy to quickly find the information you need from federal income tax brackets and rates to capital gains and qualified dividend rates, contribution limits for retirement plans, annual gift and estate tax exclusion amounts, and more. View or download your complimentary 2024 Federal Tax Rates guide now!

• 2023-24 Comprehensive Tax Planning Guide – The Return on Life^® Wealth Partners 2023-2024 Tax Planning Guide is your comprehensive guide to key tax provisions and deadlines that can help you reap the full benefits of collaboration with your qualified tax advisor throughout the year. The guide also includes helpful information on key changes under the SECURE 2.0 Act that went into effect in January 2024, that will be helpful for your ongoing tax planning. View or download your 2023-2024 Tax Planning Guide now.

Want to Refer a Friend or Family Member for a No-Obligation Second Opinion?

Our Second Opinion Service makes it easy! Designed for friends, family members, and colleagues of our clients and business associates, this no-obligation service provides the people you care about with an opportunity to benefit from the same expertise and guidance that you have come to expect as a valued client.

In many cases, a second opinion will simply provide confirmation, and the confidence that those you care about are on track to fulfill their values and achieve their goals with their current financial provider or strategy. However, if needed, we are happy to suggest ways in which we can help, including recommending another provider if we are not a good fit for their needs. Either way, following a Discovery Meeting and Investment Plan Meeting with our experienced team, they will receive a Total Client Profile and a Personalized Financial Assessment of their current situation.

Download a full description and learn more about the Return on Life^® Wealth Partners Second Opinion Service and the benefits it offers to the people you care about most.

Don’t Miss Out on the Topics That Are Important to You: Visit Our Getting Frank Blog and Frank Wealth Insights Podcast

If you’re thinking about options for maximizing charitable giving in a tax-efficient manner before year end, be sure to check out our latest Getting Frank Blog and Frank Wealth Insights podcast for information on this and other timely topics impacting your finances and investments.  You can also access our latest blog posts and podcasts by connecting with us on social media at LinkedIn, Facebook, X (formerly Twitter) and YouTube.

Market & Economic Update

*Source: https://www.lpl.com/research/blog/october-seasonals-trick-or-treat.html

October Seasonals: Trick or Treat?

September didn’t live up to its reputation as a scary month for stocks. As the calendar now turns to October, we examine seasonality data to assess whether the month is more likely to deliver a trick or a treat for stock market investors. 

After an extremely poor start, during which stocks — as measured by the S&P 500 Index — were down over 4% and saw the worst weekly return since early 2023, this September eventually bucked the historic seasonal trend of being the worst month of the year for stocks and finished up by over 2%. Stocks were boosted over 6% from the intra-month lows by an aggressive 0.5% rate cut from the Federal Reserve (Fed). 

October Has Been More of a Treat Than a Trick for Equity Investors 

October has generally not been a scary month for stocks, with the S&P 500 generating an average return of almost 1% over longer time periods. Over more recent periods, October has been even more of a treat for investors, with an average gain over the past 10 years of 1.6%, and over the past five years of 2.4% (the third best month during both these periods, behind only November and July). 

Analyzing the data by the frequency of positive monthly returns shows October is quite middle-of-the-road. The S&P 500 has generated a positive return almost 60% of the time since 1950, near the long-term average over all 12 months, and much better than spooky September’s 43% positive rate (the lowest of all months).

October is a Big Improvement on September’s Frequency of Positive Monthly Returns

When considering seasonality slightly further into the future, our research shows that the two-month October-November return window is the strongest over the past five and ten years, and the second strongest over the past 20 years and all periods back to 1950. November is the strongest month based on data to 1950, with December second; as such, it is no surprise that November–December (sometimes including the “Santa Claus Rally”) is the strongest two-month period over that longer-term period — bringing festive cheer to stock market investors. Based on our research, the fourth quarter is also the strongest quarter for stock market returns over all the time periods studied (including an impressive 9.8% average quarterly gain over the past five years), though in presidential election years the average 2.5% fourth-quarter gain does trail the second quarter (+2.8%) as the strongest.

October–November Has Been the Strongest Two-Month Window Over the Past 10 Years

It would not be October without some scares, though, and the effect of the presidential cycle on longer-term seasonality potentially warrants some “Octoberphobia” to counter the positive seasonality trends highlighted above. Looking back to presidential election years since 1950, the average return in October has been negative (-0.85%) and October is the worst month of the year. In presidential election years, only half of the Octobers since 1950, and only one of the past six (2004), have finished in the green for the month. Markets crave certainty, and given the high degree of uncertainty in the weeks leading up to presidential (and House and Senate) elections, it's unsurprising the trend is for markets to wobble and volatility to increase. Interestingly, the reverse is true in midterm years, with midterm year October’s being the strongest month overall, and there being only one negative midterm October since 1990. Year two of the presidential cycle is the weakest, with only one positive month on average for stocks between April and September, so the midterms may come as a belated cure for political uncertainty that has been brewing throughout the year. In the final stages before midterms, incumbent administrations may also push for policies (to at least be announced) that stimulate the economy and improve market performance, to boost their party's electoral prospects.

On Average, Stocks Hit a Short-Term Bottom Right Before the Election

Based on our analysis, this year has been well above average in terms of the magnitude of stock market performance, but directionally it has been typical of a presidential election year — overall positive with a summer dip. If 2024 follows a similar pattern, then we could notice stocks struggle through October until much closer to the election. In election years, on average, stocks typically find a bottom from these late summer jitters right around a week before the election, as the forecasting of the outcome becomes more accurate closer to Election Day. In midterm election years, on average, stocks traded underwater for much of the year before popping just before the midterm election into the strong fourth quarter period.

In general, October has proven more of a treat than a trick for stock markets, but in U.S. presidential election years the month can be a little scary for investors as markets struggle to come to terms with the uncertainty of the election results. Fed rate cuts in September boosted stocks during what has been a historically weak month for stocks, but after five straight positive months, we would not be surprised if we see at least a consolidation in October as markets take a breath ahead of the election. 

We continue to maintain a tactical neutral stance on equities. However, we do not rule out the possibility of short-term weakness, especially as geopolitical threats in the Middle East escalate. Equities may also readjust to what we expect will be a slower and shallower Fed rate-cutting cycle than markets are currently pricing in, although both post-election and fourth-quarter seasonality are favorable for stocks.

Closing Remarks

As we head into the final stretch of this election year, you can rely on your Return on Life^® Wealth Partners team to keep you up to date on market and economic developments, and continue to monitor and adjust our portfolios, as appropriate. Please know that you’re always welcome to contact your dedicated team at 440.740.0130 if you have questions or if you’d like to schedule a time to meet with us at our office. For those who prefer to meet virtually, we continue to use Zoom for virtual meetings and are always available via phone. Just let us know how you prefer to meet, and we’ll make it happen!

Real People. Real Answers.

Health, Happiness, and a Life Well Lived,                                                                                     

Frank Fantozzi

CPA, MST, PFS, CDFA, AIF^®, CEPA
President & Founder
Frank@ReturnOnLifeWealth.com
ReturnOnLifeWealth.com

IMPORTANT DISCLOSURES

*A portion of this research material was provided by LPL Financial, LLC, October 2024. All information is believed to be from reliable sources; however, neither Return on Life Wealth Partners or LPL Financial make any representation as to its completeness or accuracy.

This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth may not develop as predicted and are subject to change.

References to markets, asset classes, and sectors are generally regarding the corresponding market index. Indexes are unmanaged statistical composites and cannot be invested into directly. Index performance is not indicative of the performance of any investment and do not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results.

Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services.

For a list of descriptions of the indexes and economic terms referenced in this publication, please visit lplresearch.com/definitions.

All index and market data from FactSet and MarketWatch.

Unless otherwise stated, Return on Life Wealth Partners/Planned Financial Services and the third-party persons and firms mentioned are not affiliates of each other and make no representation with respect to each other. Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services.

This information is not intended to be a substitute for individualized tax advice. We suggest that you discuss your specific issues with a qualified tax advisor.

Investment advice offered through Planned Financial Services, LLC, a Registered Investment Advisor.

Copyright © 2024 Planned Financial Services. All Rights Reserved.

Diversification is a key strategy for managing risk in an investment portfolio, based on the philosophy that you shouldn’t put all your “eggs in one basket.” By spreading investments among asset classes, industries, sectors, geographical areas or other criteria, you’re more likely to own securities that perform differently under different market conditions. However, building a diversified and more stable portfolio isn’t as easy as it might seem.

Managing risk

Diversification increases the odds that at least some of your investments will perform well at any given time. But simply distributing your money among several mutual funds doesn’t necessarily achieve diversification. Putting your eggs in many baskets won’t be effective if the baskets are too similar to each other. This concept is generally known as “false diversification.” To determine whether your portfolio is truly or falsely diversified, you need to drill down beneath the surface.

But first, it’s important to understand that the goal of investing isn’t to eliminate risk. After all, without some risk, there would be no rewards. If you invest too conservatively (particularly when you’re young), your asset growth may not keep pace with inflation and may erode your wealth over time. But if you invest too aggressively (particularly when you’re approaching retirement), you may expose your wealth to market volatility, which can quickly turn gains into losses.

Diversification, therefore, is a valuable tool for balancing risk and reward. The idea is to spread investments among assets that are negatively correlated — meaning their prices tend to move in different ways in response to the same conditions. If assets in your portfolio are too highly correlated or their prices move in tandem, your portfolio will be more sensitive to market volatility.

For example, if all of your investments are in large-cap stocks, a downturn in the S&P 500 index (which is made up of large-cap stocks) can have a devastating impact on your portfolio. But if your portfolio is properly diversified, poor performance in one area of the market may be offset by gains or more limited losses in other areas.

Right mix

Although the right mix of assets for you depends on your particular circumstances, diversification can be achieved in many ways.
These include by:

Asset class. Stocks, bonds and cash (generally, very short-term debt) tend to behave differently under similar conditions.

Company size. Large-cap, mid-cap, small-cap and micro-cap stocks often perform differently under similar conditions.

Bond type. You might invest in a mix of government, corporate and municipal bonds, in bonds of different maturities or durations, or in bonds with different credit ratings.

Investment style. For instance, a mutual fund or exchange-traded fund (ETF) might focus on growth investing, value investing or a blend of the two styles.

Industry or sector. The same economic or market factors may affect companies in different industries or sectors, such as technology, energy and pharmaceuticals.

Geography. Diversification can be achieved with a mix of domestic and international investments and, within the international arena, a mix from developed and developing countries. Note that securities from developed countries, particularly of large international companies, often perform similarly to U.S. securities.

These are just some of the factors to consider. The key to successful diversification is to analyze when the movements of your holdings are highly correlated.

False diversification

In our view, mutual funds and ETFs can be great diversification tools. Often, they invest in a specific asset class or follow a particular investment style (although many funds blend several asset classes or styles). But simply investing in several mutual funds or ETFs doesn’t necessarily mean your portfolio is diversified. True, each fund may hold dozens or even hundreds of investments. But if these “baskets” are too similar to one another — for example, if they all invest in large-cap, dividend-paying stocks — their underlying securities will tend to correlate.

We believe that to avoid false diversification, it’s important for your funds to include a mix of assets and investment styles that are negatively correlated. And don’t let your portfolio’s strong performance during good times give you a false sense of security. If all of your investments are up at the same time, that can actually be a red flag for false diversification. Tomorrow, they could potentially all decline together. You also could potentially lose money on one or more investments.

Mix it up

In general, the best way to reduce investment risk is to examine your own personal financial goals, time horizon and tolerance for market volatility, and diversify from there. You may not want to do anything that can potentially reduce your portfolio’s upside potential. But remember, diversification also usually lowers downside risk. Talk to your financial advisor about the best way to “mix it up.”

Sidebar:   Do you have too much of a good thing?

As critical as portfolio diversification is, it’s possible to overdo it. As you add stocks, bonds, funds and other assets to your portfolio, remember the law of diminishing returns. The more investments you add, the less risk reduction you get in return, until it’s minimal. At that point, you may actually harm returns.

There are several reasons for this. One is that the more assets you hold, the greater the commissions, fees and other transaction costs you may pay. Another is that investing in a large number of assets makes it more difficult to track and manage your holdings, which can have a negative impact on quality, tax efficiency and asset mix.

Investment advice offered through Planned Financial Services, LLC, a Registered Investment Advisor.

The views, opinions, estimates and strategies expressed herein constitutes the author's judgment based on current market conditions, and are subject to change without notice, and may differ from those expressed by other areas of Planned Financial Services. This information in no way constitutes research and should not be treated as such. You should carefully consider your needs and objectives before making any decisions. For additional guidance on how this information should be applied to your situation, you should consult your advisor.

© 2024

The net investment income tax (NIIT) has been around for more than 10 years, but the number of people subject to it has gradually more than doubled during that time. Why? Because the income thresholds that trigger the tax aren’t indexed for inflation. As incomes rise with inflation, an increasing number of taxpayers are exposed to the NIIT. Here’s how to minimize the threat.

Assessing your risk

The NIIT is an additional 3.8% federal tax on net investment income (NII) from items such as taxable interest, dividends, capital gains, rents, royalties and passive business interests. Certain types of income are exempt, including wages, income from a business you actively manage (except for trading financial instruments or commodities), tax-exempt interest, taxable distributions from IRAs and qualified retirement plans, and Social Security benefits.

It applies to individuals with modified adjusted gross income (MAGI) over $200,000, married couples filing jointly with MAGI over $250,000 and married people filing separately with MAGI over $125,000. These are the same thresholds that applied when the tax was established in 2013. Although NII includes capital gains, the tax doesn’t apply to the tax-exempt portion of your net gain on the sale of a principal residence ($250,000 for single filers, $500,000 for joint filers).

To calculate your exposure, multiply your NII or the excess of your MAGI over the applicable threshold (whichever is less) by 3.8%. For example, if you’re a joint filer with $100,000 in NII and MAGI of $300,000, your tax is 3.8% x $50,000, or $1,900.

Strategies for reducing NII and MAGI

In general, you can reduce NIIT by reducing your MAGI or by reducing your NII (which also reduces your MAGI). To reduce your MAGI:

• Increase tax-deductible contributions to traditional IRAs, 401(k) plans and other retirement plan accounts — all of which reduce gross income.
• Make qualified charitable distributions (QCDs) from a traditional IRA. If you’re over age 70½, you can donate up to $100,000 per year directly from your IRA to a qualified charity. QCDs apply toward the amount of required minimum distributions you’d otherwise have to take, keeping those funds out of your gross income.
• Convert a traditional IRA into a Roth IRA, which can reduce your gross income in future years.

If you want to lower your NII (and also your MAGI):

• “Harvest” capital losses (or sell investments at a loss) to offset capital gains you’ve realized during the year.
• Reduce taxable interest income by investing in tax-exempt municipal bonds.
• Minimize dividend income by shifting investments into growth stocks that pay low or no dividends.
• Transfer income-producing investments to family members in lower tax brackets (provided the “kiddie tax” doesn’t apply to them).

You may also be able to spread sales of highly appreciated investments over several years to minimize the amount of NII in any single tax year.

Small tax, big bite

A 3.8% tax may seem relatively insignificant, especially compared with federal income tax rates. But when you compare tax-equivalent returns on various investment alternatives — such as taxable vs. tax-exempt bonds — consider the NIIT. To ensure you’re making the most tax-efficient decisions, discuss strategies with your financial advisor.

Investment advice offered through Planned Financial Services, LLC, a Registered Investment Advisor.

The views, opinions, estimates and strategies expressed herein constitutes the author's judgment based on current market conditions, applicable tax code, etc., and are subject to change without notice, and may differ from those expressed by other areas of Planned Financial Services. This information in no way constitutes research and should not be treated as such. You should carefully consider your needs and objectives before making any decisions. For additional guidance on how this information should be applied to your situation, you should consult your advisor.

This information is not intended to be a substitute for individualized tax advice. We suggest that you discuss your specific issues with a qualified tax advisor.

© 2024

Is your child starting college this fall? If so, you may be knee-deep in the many financial considerations that attend higher education. You’re probably grateful if your child received scholarships, grants and other financial aid to help defray the cost — but not so grateful about potential tax exposure. When exactly is financial aid taxable and when is it not? Let’s take a look.

When aid is tax-free

Scholarships and grants, including Pell Grants and Fulbright Grants, are generally treated the same from a tax perspective. If scholarship or grant funds are used by a degree-seeking student to pay for qualified education expenses at eligible education institutions, they aren’t considered taxable income.

A degree-seeking student pursues studies for an associate, bachelor’s or higher degree at an eligible education institution. Eligible institutions provide programs with full course credits toward college degrees, or they offer training programs for students seeking gainful employment in recognized occupations. These institutions also must have received a nationally recognized accreditation status.

Qualified education expenses include tuition and fees, as well as course-related expenses (such as books, supplies and equipment) required in a student’s course of instruction. They don’t include room and board, however. To qualify, expenses must be required of all students taking the particular course. Optional expenses aren’t considered qualified.

When proceeds are subject to tax

If scholarship or grant proceeds are used for any external purposes, the money is considered unearned income and is subject to taxation. This includes funds left over after all qualified education expenses have been paid. Of course, students can use this money for other purposes, such as to pay for room and board, utilities, groceries or meals eaten out. But they’ll have to pay tax on it when they file income tax returns.

It's important to note that qualifying payments received through the Department of Veterans Affairs (including the GI Bill) generally aren’t taxable if used to pay for education or training. But if a student receives payment for teaching, research or other services that are required as a condition of receiving the scholarship or grant, this money is generally considered taxable income. Exceptions are made for services required by the National Health Service Corps Scholarship Program, the Armed Forces Health Professions Scholarship and certain other programs.

When the “kiddie” tax comes into play

Another potential issue is the “kiddie” tax. This tax originally applied to children under 14 years old with unearned income, but its scope has progressively increased over the years. Now, the kiddie tax applies to some college students — specifically, children who are claimed as dependents and are under 19 years old, or full-time college students between 19 and 23 years old who have at least one living parent and aren’t married and filing joint tax returns with their spouses.

College students who meet one of these definitions and have unearned income worth more than twice the standard deduction amount for a dependent must complete IRS Form 8615 to determine how much tax is owed. The 2024 standard deduction for a dependent is $1,300 or the sum of $450 plus the individual’s earned income, not to exceed the regular standard deduction.

Don’t let it fall through the cracks

Right now you might feel a little overwhelmed by the financial details of sending a child to college. But don’t let tax issues fall through the cracks. Consult an experienced financial advisor.

Investment advice offered through Planned Financial Services, LLC, a Registered Investment Advisor.

The views, opinions, estimates and strategies expressed herein constitutes the author's judgment based on current market conditions, applicable tax code, etc., and are subject to change without notice, and may differ from those expressed by other areas of Planned Financial Services. This information in no way constitutes research and should not be treated as such. You should carefully consider your needs and objectives before making any decisions. For additional guidance on how this information should be applied to your situation, you should consult your advisor.

This information is not intended to be a substitute for individualized tax advice. We suggest that you discuss your specific issues with a qualified tax advisor.

© 2024

Estate planning isn’t a “set it and forget it” proposition. We believe you should review your plan regularly and update it to reflect changes in your personal or financial circumstances.

Personal and financial shifts

Perhaps your net worth has substantially increased or decreased or you’ve acquired or disposed of valuable assets. If you got married, you’ll probably want to add your spouse to your plan. And if you got divorced, you’ll likely want to remove your ex-spouse — as a beneficiary as well as a trustee. Other family changes that may prompt an update include having or adopting a child, becoming a grandparent, the death of a beneficiary, or changes in a beneficiary’s financial circumstances.

We also believe it’s important to review provisions designating representatives charged with executing your plan. Say, for example, a person you named as executor, trustee, guardian or power of attorney holder has died, or is no longer capable or willing to serve.

Check and revise

Other life changes may make it necessary or desirable to update your plan. Determine whether any of these apply:

• You started a business venture and want to coordinate business succession planning with your estate plan.
• You’re concerned about exposure of your wealth to creditors’ claims or lawsuits and wish to increase asset protection.
• Your children have reached adulthood and you wish to name one or more of them as executor or give them powers of attorney.
• A child, grandchild or other family member is or has become disabled and you wish to set up a special needs trust.
• Your child or grandchild divorced and you want to protect your wealth from ex-spouses.
• You moved to a new state with substantially different income or estate taxes.
• Your relationship with a beneficiary has soured and you wish to disinherit him or her.
• You decided to make sizable donations of cash or assets to charity.
• You’ve accumulated significant digital assets and need to provide for their disposition.
• Your health has declined and you want to change your preferences regarding life-sustaining medical treatment.

You should update financial and health care powers of attorney (or other medical directives), periodically, even if you’re not naming a new representative. Some health care providers and financial institutions are reluctant to honor older documents.

Good idea

Even if nothing has changed in your life, we believe it’s important to review your estate plan every few years. Check in with your estate planning advisor for help.

Investment advice offered through Planned Financial Services, LLC, a Registered Investment Advisor.

This newsletter is meant for informational purposes only, is not intended to serve as a recommendation to buy or sell any security and is not an offer or sale of a security. Investors should consider their investment objectives and risks carefully before investing.

This information is not intended to be a substitute for individualized tax advice. We suggest that you discuss your specific issues with a qualified tax advisor.

© 2024