Money you accumulate can work like an orchard, and the income—the fruit crop—helps run retirement life. Some in the industry would call clients taking out their own money “attrition.” Attrition, per the dictionary: “loss or destruction, corrosion, waste.” But to us, it’s simply investing wisely, spending well. Attrition, shmattrition.
Want content like this in your inbox each week? Leave your email here.
We’ve got Roth IRAs on the brain. Why? How would you like to never, ever pay income tax on investment gains and dividends and interest on some fraction of your money? Oh—and your beneficiaries never would either. Well?
That’s the magic of the Roth IRA, properly used.
Every single person may convert existing IRA or rollover balances into a Roth IRA, by paying income tax on the converted amount. Many believe income taxes will rise in the years ahead, above the scheduled increases in the current law.
Anyone may do a conversion of the amount they choose from existing IRA or rollover accounts, although other factors determine whether you are also eligible to contribute: those limits vary year to year, so be sure to check on your particular situation.
Here are some reasons that people are using this conversion technique:
Like so much of life, we cannot know the future, so we simply do the best with what we do know. “A little of this, a little of that” may be a prudent way to deal with uncertainty. Future tax rates, future investment results, and your future cash flow needs are all unknown. So it might make sense to take a middle-of-the road approach—and build more flexibility into your retirement situation.
Roth conversions go by calendar year, so if you would like to talk about your options, please call or email us in the next few weeks.
Traditional IRA account owners have considerations to make before performing a Roth IRA conversion. These primarily include income tax consequences on the converted amount in the year of conversion, withdrawal limitations from a Roth IRA, and income limitations for future contributions to a Roth IRA. In addition, if you are required to take a required minimum distribution (RMD) in the year you convert, you must do so before converting to a Roth IRA.
This material is for informational purposes only and does not constitute tax, legal, or investment advice. Please consult a qualified tax professional regarding your individual circumstances.
Want content like this in your inbox each week? Leave your email here.
Play the audio version of this post below:
An RMD at 73? It’s not the catchiest IRS rule we’ve ever heard… And you’re not alone if you’ve ever been confused by an IRS rule. 😅 In this week’s video Mark’s talking about “Required Minimum Distributions.” Stop by or give us a call if you’re wondering what it might mean for you.
Want content like this in your inbox each week? Leave your email here.
Here in the Midwest, we have something called Level B roads. Nebraskans know them as “minimum maintenance roads”: they’re those dirt roads that are not maintained by the county or state. They’re usually used for farmers or the folks who reside in the remote country.
These roads are functional but can be dangerous. The road is usually only big enough for one car to pass through. Dry dirt can easily turn into a mudslide after a downpour.
Every time we pass one of these roads, we see a warning that states “Enter At Your Own Risk.” Meaning: If you get stuck, you will have to find your own way out. You are liable.
These Level B roads remind us a lot of speculative investments.
Speculative investments attempt to outperform the market, quickly. They are high-risk, and focus on short-term price movements rather than long-term results. (For examples, just think of the fads or headlines that seem to come and go the fastest in the investment world.)
Speculative investments have always been a trending topic, but we haven’t jumped on the bandwagon.
Risk and reward go hand in hand. High volatility means big swings—maybe you earn a big whopping percent or you lose it—and most investors aren’t signing up for that kind of ride. Clients, many of you have been working with years and decades to grow your wealth. There’s no need to hop on a Level B road going 60 miles per hour: there’s time to take in the view and pick and choose our route!
Speculative investments might get you to where you’re going, faster… or you could wind up stuck with more problems than before.
We prefer to pick our positions in equities with a little more perspective. We track our investments weekly, rebalance portfolios quarterly. We don’t have to think too hard about trying any shortcuts, because we are in it for the long haul.
Clients, we sure appreciate this journey with you. Please call or write with any questions.
Want content like this in your inbox each week? Leave your email here.
Play the audio version of this post below:
Clients, there is a new friendly face that recently joined our team. Let us take a moment to get everyone up to speed.
As our enterprise grows, so does our team!
We’re pleased to introduce Jenna Groves, joining us as our newest Client Services Associate.
We believe the core activities of our enterprise are investment research, portfolio management, and talking to you. But nothing happens until the details are handled, and they are crucial. So Jenna is joining our client services team—a team that plays a vital role.
Jenna brings years of experience working in banking and healthcare industries, so a passion for helping others is part of her DNA. We could tell right away that her attitude, values, and skillset were a great match for our needs. She tells us she’s excited to join our team that strives to put people first and help them feel supported and informed.
A Springfield native who has lived in Louisville for years now, Jenna fits right in here with our love of the outdoors. Her family includes her high school sweetheart and her 5-year-old son. And if you’re a fan of country music, she’d love to chat, as one of her favorite activities is attending country music concerts.
Jenna may be the latest addition to the 228 Main team, but she is already caught up on the “history” of our work here. The mission is the same for the whole team: we strive to grow your buckets. And that project takes all of us, from research and trading to paperwork and communications—it happens when all of us are ready to be of service to each other.
Come in and say hello if you have a chance. Welcome, Jenna!
Play the audio version of this post below:
Our spending habits matter, but it’s not just about investing our money. How do we get our time to pay us dividends?
Want content like this in your inbox each week? Leave your email here.
Celebrating 30 years means we honor the teammates that make this thing possible, to this day. It’s also about the team going forward from here! In this brief video, Greg shares an important personal update with our community, and we couldn’t be more thrilled. 🎉
We invite you to take a moment to learn about what changes—and what doesn’t—in Greg’s future.
Want content like this in your inbox each week? Leave your email here.
People or companies may confer benefits on third parties without cost, as a side effect or byproduct of their actions. Planting a tree improves the neighborhood and provides shade to a neighbor. Keeping bees results in the pollination of nearby crops. Providing first-aid training to workers may save lives outside of work. A video or blog post created for clients might contain an idea that helps people who are not clients.
These are examples of what economists call positive externalities. These things are all good. They make the world a better place.
I believe the concept applies in our interactions with others, as well. Have you ever had your day brightened by the laughter of a group of passersby? Watched someone hold a door for someone with an armload of packages? Overheard a “thank you” being given for an otherwise thankless task?
All of these things are benefits that they produced for free and you enjoyed at no extra cost. They are positive externalities, on the small scale of daily life.
Having a tree planted improves our home as well as the neighborhood, but generating positive externalities can also help us beyond business transactions. Friends and family members respond to the empathy, kindness, and thoughtfulness embedded in any of those little actions we can take. If employed, those in our network are likely to sense the intangibles we add to the workplace environment. Our teammates across the community likely enjoy our interactions more.
Generating positive externalities is not charity. There are no costs involved, only benefits for giver, recipient, and neighbors and passersby. Win-win-win.
The general concept has been around for a long time, and is often expressed more simply. Be kind. Fill up the buckets of others. Do unto others.
Clients, if you would like to talk about this or anything else, please email us or call.
Want content like this in your inbox each week? Leave your email here.
Play the audio version of this post below:
by Mark Leibman, Advisor
Thirty years ago this month, I sat down at the kitchen table and went to work—Day One—in Leibman Financial Services. I’d had the idea for more than a decade that I could assemble a group of clients, who, if I took care of them, they would take care of me. At age 40, it was time to test the theory.
The stakes were high. My life in financial services had been transactional up to that point. I knew if I did not change, I might wake up at sixty years old, needing to run up and down the highway to make a deal to pay for groceries. A sales mindset was not sustainable.
Getting serious about managing portfolios for people meant that my business objective could be simplified into this: grow the clients’ buckets.
It was hard, starting from scratch. We struggled and juggled for years. But business began to compound. Investment returns grew client balances, which grew revenue. Four years in, the quaint office building at 228 Main in beautiful downtown Louisville came available. I could neither afford it, nor afford to pass it up, so you know what I did!
Business doubled. And doubled. And doubled. And doubled. It turns out people like it when the focus is on growing their buckets.
The one-man band became a team of eight, eventually. I’m well down the path of working to age 92, with the enterprise around me that makes it possible. (Hey, Dylan is touring at age 85! I’m only 70.)
In this 30th anniversary month, I’m thinking of you, clients, grateful for your part in this glorious journey. Here’s to the next 30.
All investing involves risk including loss of principal. No strategy assures success or protects against loss. Past performance is no guarantee of future results.
Play the audio version of this post below:
No matter how beautiful, some flowers still have thorns. And no matter how flashy, some salespeople will have them too. Remember that not every person you meet will have your best interest at heart. Don’t let any peddlers dazzle you with diamonds! It never hurts to ask for a second opinion.
Want content like this in your inbox each week? Leave your email here.
You must be logged in to post a comment.