Financial Fitness – Mid-Year 2022 Check-In

Summer will officially be here soon, but before kids get out of school and all the vacation planning you did begins to come to fruition, it can be a good idea to take stock of your financial picture and make updates where necessary. Below are a few things you should consider to keep your plan in shape. We’ve organized them by life stage, from having small kids to being closer to retirement. We’ve also included charitable giving, as that happens at every stage.

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Tax Planning For Retirement: The Long Game

Tax planning for retirement is different from the strategies you deploy to minimize taxes while working. You’ll be using your investments for income, and the way they are taxed is different depending on the type of account you hold assets in. In addition, at age 72, you’ll begin taking required minimum distributions from your tax-deferred accounts, and these amounts can quickly push you into higher tax brackets.
Does it matter? According to research done by Morningstar, tax planning can add up to 4% to retirement income.

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June Market Commentary: Lions, Tigers, and Bears, Oh My!

May Recap and June Outlook

The Fed lion has found the courage to increase interest rates drastically, the inflation tiger is still ambushing the economy, and now the stock market is flirting with bears. The question for investors is: Are we still deep in the forest? Or is that the Emerald City on the horizon? To extend the metaphor – that wizard wasn’t much help, and the solution to the problem turned out to be a liquidation.

Just to be clear, they melted the witch. We’re not suggesting melting your portfolio.

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GMB #132: From Tech Founder to Venture Capital & Real Estate Investor with Zain Jaffer

The world of real estate is full of opportunities for investors who strive to build wealth using innovative strategies. This week on Grow Money Business, we have a fascinating conversation with Zain Jaffer. Zain is a tech entrepreneur, a real estate investor, and the founder of Vungle, which was sold to Blackstone for $780 million in an all-cash transaction in 2019. Today, he invests in real estate and real estate technology businesses through both venture capital and private equity funds.

 

 

Show Notes

[02:15] Zain’s experience – Zain describes what he finds so appealing about real estate investing.

[09:58] Investment Opportunities – Zain shares what he looks for in new investment opportunities and how he assesses whether or not they are a suitable fit.

[16:54] Institutional Impacts on Real Estate – Zain and Grant discuss the argument that institutional interest in residential real estate is making it more challenging for individuals to purchase their own homes.

[22:15] PropTech Startups – Zain describes his future career goals and plans to continue investing in PropTech startups.

[26:33] More on Real Estate Investing – Zain shares some common themes he hears presented from startups seeking investments.

[34:09] Zain’s Journey – Zain outlines his professional journey, starting with the founding of Vungle, to his eventual $780 million exit.

[41:05] Cryptocurrency – Zain shares his thoughts on cryptocurrency.

 

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GMB #131: Everything You Need to Know About Digital Estate Planning With Hannah

Have you ever thought about what happens to your social media accounts when you pass away? Do you consider yourself familiar with the legal frameworks that need to be put in place to ensure your spouse has access to all of your online accounts? Our guest this week is Hannah Shakin, an attorney in Downey Brand’s estate planning department. Hannah is a qualified estate planning, probate, and trust administration specialist. Throughout the episode, Hannah shares her insight on the ins and outs of digital estate planning, as well as how you can protect yourself from making the common mistakes she sees regularly in her practice.   

 

 

Show Notes

[02:15] Hannah’s Background – Hannah shares her background and describes what she does on a day-to-day basis at her practice. 

[04:42] Digital Estate Planning – Hannah describes both the evolution and the current state of digital estate planning.  

[15:33] RUFADAA – Hannah details the elements of The Revised Uniform Fiduciary Access to Digital Assets Act.  

[19:45] Facebook – Hannah discusses social media accounts, and what happens to them when you pass.  

[23:47] Digital Assets – Hannah defines what is considered a digital asset and explains why it is vital to establish a living trust to avoid probate.  

[35:49] More on Estate Planning – Hannah explains why individuals must modify their estate plans, and shares which assets will or will not be passed into a trust.  

[44:41] Contingency Planning – Hannah discusses the importance of your exit strategy aligning with your estate plan.  

[47:28] Common Mistakes – Hannah identifies the most common mistakes that she sees business owner’s make in her practice.  

[52:24] IRA and Trust – Hannah elaborates on various facets of individual retirement accounts and trusts. 

 

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The Structure Matters: Choosing the Right One for Your Business

The choice of a corporate structure for a business has many consequences: a crucial impact on the business’s taxes, your ability to raise funds, the paperwork you must file, and perhaps most important, your personal liability.

Fortunately, you can change your mind and convert to another business structure later on, but as with all legal matters, it is not that simple; switching could have a few negative impacts. For example, your state may have restrictions about these changes, and there could be tax consequences, among other issues.

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A Charitable Strategy for Tax-Efficiency: Qualified Charitable Distributions

If supporting charities meaningful to you is part of your long-term financial plan, creating a strategy around your giving can help you maximize the gifts you give. It can also be tax-efficient across several dimensions of your overall plan.

A qualified charitable distribution (QCD) is a distribution from your IRA account that you are eligible for beginning at age 70 ½. But because it goes directly to the charity of your choice, it doesn’t count as taxable income to you. It can keep your income at a lower level and help you avoid taxes on social security and premium surcharges on Medicare. In addition, the IRS will allow the QCD to count as a required minimum distribution (RMD) from your account.There are rules to follow and limits to be aware of but being thoughtful about including qualified charitable distributions in your financial plan can help you achieve multiple goals.

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Selling a Family Business: Preparing for a Transformational Event

It’s generally thought that there are several cycles that reflect where a business is in preparedness for a sale. These capture the economy, the market, and the mindset and planning of the business owners.

From an economic standpoint, the liquidity cycle is the one that matters. This cycle gauges the amount of available liquidity and the current appetite of investors to invest in companies.1 With record amounts of cash sloshing around looking for investments and interest rates continuing to be low, the liquidity cycle is currently at an advantageous point, and looks poised to remain so.While getting the right price is clearly a big consideration, there are a lot of other things to think through that are just as important.

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GMB #130: Innovation in Stock Market Structure: A 40 Year History Lesson With Kenny Polcari

With the widespread adoption of retail investing and the usage of handheld devices, investing and stock trading have become easier than ever. However, in the 1980s, it used to be an entirely different story. This week on Grow Money Business, we bring you an informative and entertaining conversation with a stock trading veteran who has been in the industry during many of the defining moments of the financial markets over the last four decades. Kenny Polcari, Managing Partner Kace Capital Advisors, joins us today to dive deep into how the stock market structure has evolved over the last few decades.

 

 

Show Notes

[02:54] Getting to Know Kenny – We start the conversation with Kenny’s long career in the financial sector and discuss what the New York Stock Exchange was like when Kenny began his career in the 80s.

[08:16] Building a Career – Kenny reflects on a couple of stories from the early years of his career and how he progressed through the industry.

[15:23] Stock Trading in the 80s – Kenny talks about the way stock markets worked in the 80s and why that environment was exciting.

[22:50] Members of Stock Exchange – Kenny explains the role of a member of the New York Stock exchange.

[27:17] Technology – Kenny discusses early applications of computer-based analytics for financial markets and how relying too much on technology led to a meltdown in the financial markets across the globe.

[42:19] The Tech Boom – Kenny shares his thoughts on how the massive expansion of technology that took place in the 90s shaped the financial markets.

[48:36] The Evolution – How the stock markets and the technologies used for stock trading has evolved over the last few decades.

[54:06] Impact of 9/11 – Kenny reflects on how the September 11th attacks destroyed the infrastructure of the New York Stock Exchange and the process of recovering from that destruction.

[1:00:55] Modern Stock Trading – How the modern stock trading systems make use of the latest technology available in order to make stock trading more reliable and immune to threats.

 

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GMB Ep #129: No, Index Investing Isn’t Bad For The Markets

 

With recent developments in the financial markets, we’re seeing quite a bit of people who are concerned about index investing and the effects it may have on the economy. We dedicated today’s episode of Grow Money Business to addressing some of these concerns. Throughout the episode, Grant shares his thoughts on four of the biggest arguments against index investing and some studies that question the legitimacy of each.

 

 

Show Notes

[03:18] Recent Developments – How the recent developments in the financial markets reignited the discussion against index funds.

[06:15] Competition – One of the major arguments against index investing is that it reduces competition within an industry. Grant shares his thoughts on why this notion is not valid.

[13:11] Corporate Governance Standards – Grant explains how index funds allocate their resources in a way that’s beneficial to shareholders and why index investing won’t create corporate governance issues.

[16:46] Price Discovery – Grant breaks down how the price discovery mechanism works and why index investing is unlikely to hurt price discovery.

[28:20] Income Inequality – Grant shares his take on the argument that index investing exacerbates income inequality.

 

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