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Why Advisors Need Advisors

Have you ever heard the proverb about the cobbler’s children? It essentially states that the cobbler’s children, although surrounded by well-made shoes, have the most worn out shoes. Or that doctors are the worst patients? The same can be said for wealth advisors. We’re not immune to the common mistakes that exist in the financial world, and even we can benefit from the financial guidance we provide for others.

As a new advisor, I had an epiphany. Yes, an epiphany, as corny as that sounds. I realized that although I could adequately pick investments, decide on a savings plan and develop a strategy for myself, I wasn’t following through with it. While at a client meeting, my coworker explained it best by saying, “We help hold you accountable to your goals.” Duh! That was the thing I was not giving myself. I could make the best laid plan, but I wasn’t following through and doing the actions I needed to do to be successful. I had the knowledge, but needed accountability. The very next day I hired my first advisor. read more…

Bringing Your International Earnings Home

Many U.S. citizens live abroad for a period during their schooling, career or retirement. Foreign countries, even ones sharing borders with the United States, have different currencies than the U.S. dollar. When you exchange or otherwise convert U.S. dollars into a foreign currency, you may be able to buy more or fewer dollars in the local currency, depending on that day’s exchange rate movements. These currency fluctuations in relation to the U.S. dollar can be substantial. As a result, it’s important that you develop a plan when converting large sums of money from one currency to another to reduce your chances of losing a lot of value. read more…

Pay Yourself First: Reverse Budgeting

In this article, we discuss the Smiths’ and the Jones’ different lifestyle spending needs, and the annual savings necessary to maintain their lifestyle in retirement. Let’s walk through the steps these families should take each year to help them stay on track to achieve their goals.

1. Determine the cost of your annual lifestyle spending needs, and how much of that will continue into retirement.

  • Smiths – They currently earn $150,000 a year. After excluding retirement savings and expenses that wouldn’t continue into retirement, such as the cost of commuting to work, they determine that their annual spending is $90,000.
  • Joneses – They currently earn $500,000 a year. After backing out retirement savings and expenses that wouldn’t continue into retirement, this couple finds their annual spending is $250,000. This higher spending need is in part due to living in an expensive city and having a mortgage on their home and vacation property. About 10 years ago, this couple’s income was $175,000, with spending needs of $115,000.

Take-away: To determine your lifestyle spending needs, you need to exclude retirement savings and expenses that wouldn’t continue into retirement. Expenses that remain include utilities, taxes, food, entertainment, travel, etc. Many households carry a mortgage for the first 10-15 years into retirement. If you don’t think you’ll pay off your mortgage by the time you retire, make sure to include this housing cost in your spending estimate. You need to be aware of how much your lifestyle spending changes over time to make sure it’s sustainable in retirement. It’s far easier to spend more money than to cut back on your lifestyle. read more…

Withdrawals from an Estate and Tax Planning Perspective

Families often ask us how best to fund their obligations or monthly cash flow from their various account types. When making this decision, it’s best to revisit your goals and consider the tax and estate planning implications.

Tax Perspective

Withdrawals from taxable and after-tax retirement accounts like a Roth IRA can be made tax-free, or by paying less tax than a withdrawal from a pre-tax retirement account taxed at your ordinary income tax rates. This leads to less tax owed now.

Inheritance Perspective

For a beneficiary, it’s most advantageous to inherit taxable and after-tax retirement accounts, such as a Roth IRA. Beneficiaries receive more after-tax dollars than if they inherited a pre-tax IRA because of the step-up in basis, which eliminates capital gains in the taxable account, and because withdrawals from the inherited Roth IRA are tax free. read more…

Not All Prepaid Funeral Arrangements Are the Same

When someone passes away, their executor – usually their surviving spouse or child – must make funeral arrangements. This includes decisions around transporting the body, choosing a funeral home, arranging for a casket or cremation, and choosing a burial site. Importantly, they need to pay for each of these services along the way. This can be time consuming and stressful – all at a point when loved ones are already overwhelmed with grief.

Prepaid funerals, if purchased correctly, can help mitigate this burden. You pay up front, either in a lump sum or through a payment plan. Upon your passing, your family can contact the funeral company, who will take care of next steps.

Not all prepaid funeral arrangements are the same. Some options that seem to be good end up being bad decisions. Here are some questions to consider when evaluating prepaid funeral options. read more…

Merriman’s Guide to Reducing Your Tax Bill


Do you wish you could have done more to lower your tax bill or increase your refund for 2017? The Tax Cuts and Jobs Act of 2017 will have a major impact on many families, so it’s especially important to re-evaluate your tax strategies this year.

Check out our latest eBook for things you can do now to save on your tax bill in 2018. Topics include:

     Highlights from tax reform

     Itemized deductions – what’s left?

     New strategies to consider

     Classic strategies that still work

Download a free copy today!

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