gift-giving

The Swiss Army Knife of Finance

photo shows a Swiss Army knife

Some people consider the Roth IRA the “Swiss Army knife of finance.” A versatile tool, a Roth is useful in a lot of different circumstances. It might make sense to run through a review before year-end: your 2020 income tax situation may have an impact on your thinking. 

Here are just a few uses of the Roth IRA to consider:

1. They can help you manage your lifetime total taxes. 

You may be able to take advantage of relatively lower tax brackets now before income tax rates go up, as they are scheduled to after 2025 or in the case that future legislation raises tax rates. Converting existing retirement balances to Roth makes the amount converted taxable now—but wipes out taxes on future gains. 

Moving temporarily depressed holdings from traditional IRAs to Roth involves paying tax only on the lower current value. Any recovery ends up being free of tax. (Airlines are an example of depressed stocks that may recover. No guarantees of course.)

2. They can add flexibility to your retirement planning.  

Unlike traditional IRA balances, Roth IRAs do not have required minimum distributions (or RMDs). And they are a useful place to go for large retirement outlays without making a bulge in your tax bill. Planning to buy a second home, boat, or camper in retirement? Roth money might come in handy then.

3. They can make great gifts. 

Roth IRAs can be wonderful for children or grandchildren with earned income who qualify to make Roth deposits because they have earnings but lack the funds with which to make deposits. Growth over the decades ahead may never be taxed.

4. They can help fund an education. 

Parents seeking versatile education funding for their children may use their own Roth IRAs as a source of funds for that purpose. If not needed, the money may remain in the Roth and ultimately help fund their own retirement. 

Right for you? 

Again, the Roth is a versatile tool! What from the list is jumping out to you? 

We understand that the end of the year can be a busy time. We would love to help you sort out these issues—just email us or call if they are pertinent to you. 


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Enjoy Your Gift

pic for Enjoy Your Gift

You never know what’s going to send your heart soaring—but it’s nice to be open for moments like that.

Recently, a swell of gratitude snuck right up on us. We received a package from a popular online marketplace. It should’ve been a mundane activity to open the box. It was full of office supplies, after all.

We discovered, however, that we must have checked the option that this delivery was a “gift.” Inside the package was a slimmed-down receipt bearing the automatically-generated greeting.

“Enjoy your gift,” the note said. We were gobsmacked.

No, no, we’re not in love with our office supplies. (They get the job done, but it’s no love affair.) We realized that our supplies let us do our work. And our work? To be of service, to you.

“Enjoy your gift.” The note seemed to be cheering us on. “Share your talents, flourish, go!”

We firmly believe that we’re all better off when each of us is free to pursue our ambitions and put our skills to use.

How can we help you in your pursuits?

Clients, you know I’m aiming to work until I’m 92, and we’re filling the shop with other talented parties who can help this endeavor thrive. What a joy to witness this little shot of confidence from the universe. And we’re happy to share it with you now.

When you’d like to talk about this or anything else, please write or call.