In no particular order, here’s a few interesting things I heard and read recently that I wanted to share:
Is Your Aging Parent Trusting The Wrong Financial Advisor? (Forbes, by Carolyn Rosenblatt)
As part of my continuing education in the financial industry, we are often educated on the topic of elder abuse. In other words, advisors are taught to respect the trust that people have in them and not convince them to make financial decisions that are not in their best interest – whether they are of sound mind or not. The fact that this topic keeps coming up is eye-opening to me, because I can’t actually believe these “bad apple” advisors exist in the world. But then I remind myself: I unfortunately have seen it first hand over the years. And I guess it’s like a lot of other business relationships – people with trust, influence, or a perceived expertise can prove to be greedy and put their interests ahead of the people relying on them. I am proud to say (as most other professional advisors should) that I can recognize when someone may be incapable of handling their financial affairs, and I know how to respond in those situations. It’s part of my commitment to the profession, and being a fiduciary – putting the client’s interests before my own. Reading this article gives a clear example of a woman who was taken advantage of, so be aware! Maybe you can lend a set of eyes on someone in your family to make sure they aren’t being taken advantage of too.
10 Life Habits All Extremely Happy People Prioritize (Inc.com, by Matthew Jones)
I love reading/sharing article likes this one for a number of reasons. Mainly it’s because I believe that happiness and health and (financial) health are all inter-twined. If you have success being happy, chances are you will be successful in most other aspects as well. Financial health (and many times wealth!) to me is a by-product of mental and physical health. I often tell people that I have had a 5+ days per week workout schedule for over 30 years now. Is it easy – no – but it requires focus and discipline, which I have. Second it helps people like me re-focus on things that are most important in life. In today’s world of negative news and overall information tsunami coming at us at every level, it’s refreshing to do a self-check and concentrate on doing the things in life that are most meaningful. For me, that’s health, family, and living a meaningful and balanced life. This list is also a good reminder that life is not perfect. There will be hurdles and obstacles all along the way. Learn to expect them, and grow from them, and not be discouraged from them. Anyways, I hope you find this inspiring and helpful… and also leads to more happiness, discipline, and of course…financial success.
New tax law provides opportunity for tax-rate arbitrage on Roth IRAs (Investment News, by Ed Slott)
I wouldn’t be nearly as educated in my field if I didn’t keep up with industry reading, and this includes following my favorite IRA expert Ed Slott. When Ed writes, I read! Ed brings up a strategy that developed from the recent tax law changes and it pertains to Roth conversions. Currently an arbitrage situation exists with those people who converted to a Roth last year, and it may make sense to revisit the conversion since the tax rates in 2018 are lower across the board. So, read through his example and check to see if you should reverse the 2017 conversion and re-execute the conversion for 2018. Doing so could results in savings of hundreds or thousands of dollars. The article goes into the hows and whys, and it’s notable that this arbitrage advantage may not exist in some situations…but it’s definitely worth looking in to. So if you converted any part of your IRA to a Roth in 2017, please read and/or discuss the situation with your advisor.
Enjoy the light reading!