Why are they made again and again? Much is out there about the classic financial mistakes that plague start-ups, family businesses, corporations, and charities. Aside from these blunders, some classic financial missteps plague retirees. Calling them “mistakes” may be a bit harsh, as not all of them represent errors in judgment. Yet whether they re … [Read more...] about Retirement Preparation Mistakes
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Making Investment Decisions
Are your choices based on evidence or emotion? Information vs. instinct. When it comes to investing, many people believe they have a “knack” for choosing good investments. But what exactly is that “knack” based on? The fact is, the choices we make with our assets can be strongly influenced by factors, many of them emotional, that we may not even be aware of. Deal du jour … [Read more...] about Making Investment Decisions
Translating Stock Market Jargon
Have you ever been confused by the jargon used on Wall Street? Allow me to translate some esoteric stock market terms into plain English. Blue chips: Stocks with a history of consistently strong dividend payments, issued by huge corporations with solid management. In addition, a nickname for the Dow Jones Industrial Average, which includes 30 companies that usually deserve … [Read more...] about Translating Stock Market Jargon
Inflation & the Real Rate of Return
Is your money gaining or losing purchasing power? The real rate of return is an important personal finance concept to understand. It’s the rate of return on your investments after inflation. The real rate of return indicates whether you are gaining or losing purchasing power with your money. So with inflation checking in at a 5% annual rate, does that mean any i … [Read more...] about Inflation & the Real Rate of Return
Why Roth IRA Conversions May Now Be Advantageous
Thanks to a couple of factors, some investors are thinking about this move before 2020 ends. Roth IRAs have attracted retirement savers since their introduction in 1998. They offer the potential for tax-free retirement income, provided Internal Revenue Service rules are followed. Do Roth IRAs seem even more attractive these days? Perhaps. You can cite two factors: … [Read more...] about Why Roth IRA Conversions May Now Be Advantageous
“Backdoor” Roth IRAs
If you make too much money to open a Roth IRA, you could create one this way. You can sum up the appeal of a Roth IRA in three words: federal tax benefit. Potential earnings in a Roth IRA grow tax free as long as the owner abides by the Internal Revenue Service (I.R.S.) rules, and withdrawals are federally tax free once you reach age 59½ and have held the Roth IRA for at … [Read more...] about “Backdoor” Roth IRAs
“Mega Backdoor Roth” – The Definitive Guide
What is “Mega Backdoor Roth IRA”? It is a financial planning technique that deals with contributing funds to a Roth IRA retirement savings account. Why does my Roth IRA need a “backdoor”? Your direct contributions to Roth IRA may be limited. There are two different limitations. The first limitation deals with the amount of money you can contribute to the account. In 2018 the … [Read more...] about “Mega Backdoor Roth” – The Definitive Guide
4 Things to Know About Backdoor Roth IRA Conversions
A backdoor Roth IRA conversion is a way of funding a Roth IRA account with a traditional IRA conversion instead of a direct contribution. People with relatively high incomes are unable to directly contribute to a Roth IRA. In 2018, the limitation starts at $120,000 for single taxpayers and $189,000 for married filing jointly. To get around this issue, they can make a … [Read more...] about 4 Things to Know About Backdoor Roth IRA Conversions