Here’s some proactive advice to help you make better financial decisions in 2016 and beyond.
Now that the final October 15 tax deadline has passed, our team at Bach, James, Mansour & Company has a couple of days to breathe before we start everything over again for next year’s tax returns. Today I was thinking about all the advice we’ve given clients this year about taxes, investments, insurance, and general business. While our advice is always specific to each client’s needs, there are five recurring themes that probably apply to the majority of you reading this article.
Here are the top five tips and pieces of advice that we’ve offered clients in 2015:
- Leave your retirement accounts for retirement. Especially in tight financial times, those 401K and IRA accounts may seem like an appealing source of money to pay bills and buy things. Please leave these accounts alone except for true emergency situations – meaning that you have absolutely no other options. Understand the full impact (penalties, lost value, etc.) before you withdraw or borrow money.
- Meet with your CPA (and your dentist) twice a year. Many clients work with us only at tax time. That’s certainly important for getting returns filed on time, but we should also meet in November or December to review your tax situation before year-end. That way we can make adjustments if needed to avoid potential surprises (like higher tax liability) before time runs out. There’s very little we can do in 2016 that will impact your 2015 tax returns.
- Act your age. As you mature, make sure that you’re adopting a more mature investment strategy as well. The portfolio you maintained in your 30’s and 40’s may be too risky as you get closer to retirement. It’s best to adjust your investment portfolio over time, shifting from a growth strategy to focus more on portfolio protection and income. That may also allow more of your money to go into your account, rather than into the broker’s pocket. Keep reading.
- Watch the fees. I see a number of clients each year who are giving away too much of their portfolio gains to brokers in the form of commissions and fees. Understand the fees you’re paying, and confirm that your brokerage account is performing at least as well as the overall market. As you approach retirement age, shift out of transaction-oriented investments to better protect what you already have so you can outlive your money.
- Ask us for help. When you’re making a big financial decision, like making an investment or buying insurance, there’s normally someone involved who makes money based on your decision. While I’m sure everyone has your best interests in mind, you don’t need to make those decisions in a vacuum. There’s a reason we don’t sell insurance or investment products. That allows us remain neutral and help clients like you with unbiased advice about important financial or business decisions. Give us a call for an independent review.
Trust us. We do this for a living…
Our goal at Bach, James, Mansour & Company is to help you remain financially healthy, fiscally aware, and well-funded through retirement. While you’re not required to take our advice, we hope that you’re comfortable asking for it.
Neal Bach, CPA