Mar 18

Part 4: What Opportunities Have I Missed?

by Geoff Wells

The last part of our “Why to Use a Financial Advisor” series involves missed opportunities.  Knowing there are unknowns out there in financial planning is the first step in identifying areas that can be improved.  A few examples of common missed items that we optimize for clients are:

529 Savings Plan in NYS – New York allows a state tax deduction for 529 contributions on up to $10,000 of yearly additions.  At a rate of 6.85%, that is an extra $685 annually just to save for college in the right bucket.  This can even be contributed in the years where college tuition is being paid.

Savings Buckets – There are many investment vehicles to save money for retirement, college or even a rainy day.  Using the optimal buckets (401(k), IRA, Roth IRA, 529, 403(b), Simple IRA, etc.) can help reduce your tax responsibility

Optimal Diversification – Diversification is becoming easier with target date funds, but many clients have suboptimal portfolios causing them to take an increased level of risk for a given return.

Tax Efficiency – If you are fortunate enough to have savings in both taxable and tax-deferred accounts, the portfolio should be optimized to include both account type characteristics.  In short, bonds and REITs should be in tax-deferred accounts and stocks should be in taxable accounts (using the same asset allocation for a level of risk tolerance).

Simplification – As the years go on, the various number of financial accounts continue to accumulate and complicate the picture.   A financial advisor can help sort through the accounts, combine some, eliminate others and come up with a simplified optimal solution customized to you.

Large Transactions – House purchases, car purchases, and new student loans are just three examples of large purchases that could make or break your financial strategy.  A financial planner can assist you in these transactions, sometimes saving thousands of dollars over the course of a loan.

Legal Documents –Wills, Estates, Trusts, Power of Attorneys, and Health Care Proxies are just as important as savings and investing.  A financial advisor can make sure you have the proper documents in place and recommend excellent professionals who can take care of the paperwork.

Social Security –With Social Security being the primary source of retirement income for most Americans, optimizing lifetime benefits is essential for most retirees.   By delaying and utilizing techniques like “file and suspend with spousal benefit,” a married couple could increase the overall lifetime value of Social Security by up to $500,000.

Return to “Why Do I Need a Financial Advisor?”

About the Author

Geoff Wells is a Certified Financial Planner at Rockbridge Investment Management. “My interest in financial planning grew from assisting friends and coworkers with their retirement plans. Over time, I developed a knack for simplifying overly complex financial topics. After several years into my aerospace career, I knew that helping people with their personal finances was my professional calling. I feel extremely fortunate to have joined Rockbridge with its fee-only advisory model and remarkable team approach to financial planning.” Geoff is a graduate of the CERTIFIED FINANCIAL PLANNER™ Certification, Ohio State University Finance (M.S.) and MBA, Kelley School of Business, Indiana University, with a Mechanical Engineering (B.S.), University at Buffalo.
Learn more and/or Contact Geoff


You Might Also Like

Other articles filed under Family Finances

Brexit Votes and Market Outcomes

June 24, 2016
Believe me, we get it. After yesterday’s Brexit referendum and its startling outcome, it’s hard to view today’s news without feeling your stomach twist over what in the world is going on. Whenever the markets scream bloody murder, your instincts...
Continue Reading

Investing and Entertainment: John Oliver’s Take

June 23, 2016
Thanks in part to our evidence-based approach to investing, we don’t have to eat our words or advice very often. But recently, we discovered that we stand corrected on one point. Fortunately, it’s a point we’re happy to concede: Evidence-based...
Continue Reading

How to Get the Right Financial Adviser

June 16, 2016
Selecting the right financial adviser is crucial. You want someone who is trustworthy and who will act in your best interest, but they are not as easy to find as you would think. A recent article in the Wall Street Journal...
Continue Reading

A Simple Guide to Life Insurance

June 13, 2016
Life insurance is often sold as a “one size fits all” product; it will serve as protection and as an investment account that will grow at an impressive interest rate.  When you take the time to unwind these products, you...
Continue Reading

Should I Google My Retirement Plan?

June 1, 2016
A simple Google search for “retirement plan” or “retirement calculator” will provide thousands upon thousands of results.  The number of websites that promise to provide retirement or financial guidance in a short amount of time are plentiful.  The real question...
Continue Reading

‹ Back to Blog Home

getting started is simple

315.671.0588 info@rockbridgeinvest.com Schedule a meeting Sign Up for Our Newsletter