As we enter into the holiday season, we all have so much to do and have to endure a very stressful time. People often neglect their personal finances, or even worse – make big financial mistakes that will haunt them down the road.

We need to always be aware of our investments and retirement goals. It’s an ongoing process and not a one time event and never considered again. To avoid you making big financial mistakes, consider some advice from an expert.

A few questions to consider are – should you convert part of their IRA to a Roth IRA with little or no tax liability? You may not have done that was possible, but yes you can actually convert your IRA with no tax consequence. Great news!

Marc Sarner is the president of Wake Up Financial and Insurance Services, Inc. He offers his clients retirement solutions for both retirees and pre-retirees. The goal is reduce taxes, increase your income and carefully manage your risks. A good financial adviser has the training and experience to help you succeed.

Should you convert your traditional IRA to a Roth IRA? Here are several advantages to consider.

1) Any growth in a Roth IRA is tax free as long as it has grown for at least five years.

2) Withdrawals from a traditional IRA are taxed because you were able to defer taxes on that money when you made contributions to your account. Withdrawals from a Roth IRA aren’t taxed because the deposits into the account weren’t tax deductible.

3) With a traditional IRA, when you reach age 70½ you must begin withdrawing a certain amount each year whether you want to or not. That’s called the Required Minimum Distribution. But with a Roth IRA, there is no Required Minimum Distribution so even at 70½ you can withdraw as much or as little as you like.

Many financial advisors are used to manage money and plan. But taking into account your tax situation is a critical piece to a successful retirement and another key to avoid big financial mistakes that will hurt you down the road.

Retirement planning for pre-retirees and retirees is a complicated and stressful process. The goal is to be financially independent, so be sure to consider all available options.

So possibly looking at a Roth IRA conversion may be part of your investment strategy to consider by the end of this year. The end result may mean you saving thousands of dollars in the long run.

Choosing the right financial advisor is an important step to help avoid big financial mistakes and impact your retirement plan. If you need to find one, contact us and we can refer a licensed adviser in your area to help you steer through the complicated world of investing. Return to follow this luxury blog for more helpfula nd informative investment tips.

When you select a financial advisor, it’s a very important decision. That person and financial firm they are associated with has a critical role in your financial well-being.

Whether you are currently choosing a financial advisor or considering one to help with you financial planning and retirement needs, the client-advisor relationship is important.

Many people today are not ready for retirement. It’s been reported by the Federal Reserve that 1 in 5 people do not have any money set aside for retirement. That is a very scary fact. How do you stack up?

Rodger Alan Friedman is a financial advisor and wealth management professional, plus author of the book “Forging Bonds of Steel.” Friedman was quoted, “This issue is making news regularly, and financial planning for retirement advertisements have spiked in recent years, in case you haven’t noticed.”

So what traits do you look for in a financial advisor. There are many advertisement out there all claiming they are the best. What is important to you?

Advisors also need to improve understanding their client’s needs. Just as every financial advisor is different, so are their clients. Some need a lot of guidance, some are very independent with minimal interaction.

– Here are four key attributes that clients should look for in a financial advisor.

• Empathy:
What is a client going through? Advisors must have their antennae up. Tears, anger, regrets and frustration are often bound with a person’s finances, and “I have met very few 22-year-olds who can fully understand the struggles, worries and dreams most people experience throughout a lifetime,” he says. Advisors have to develop an approach that helps clients feel comfortable in discussing difficult matters. The client needs to understand that the advisor truly cares and is not there merely for a transaction.

• Perspective & insight:
Perspective and insight are like twins: wherever there is one, the other is not far behind. Planners gain perspective and insight through thousands of hours of listening, collaborating, advising and acting as a steward of the financial assets and dreams of the families they serve. You know when you’re in the presence of these “twins;” it is often said that people with both see with their intellect – they possess vision. Clients should keep their antennae up for these traits when meeting a prospective advisor. Pay attention to how he or she may, as if without effort, intelligently guide the two-way conversation.

• Competence:
When advisors are unsure of themselves, it comes through. When presented with a set of facts, new advisors may not recognize what they are dealing with, or its importance. A seasoned advisor, on the other hand, has dealt with many clients with numerous problems several times over and knows what it takes to solve a problem. That’s why I feel that an experienced financial advisor is the best answer for someone in need of retirement income and financial planning. Also, financial advisors should be very well-read, with self-imposed reading requirements. Learning new ideas and revisiting old ones keeps veteran advisors fresh.

• Ability to listen:
“ ‘You have to have two ears and one mouth,’ my mother used to say; she made it clear that I should be listening twice as much as I was talking, and that advice has served me well in my life and career,” Friedman says. Clients come to an advisor for professional expertise, but they don’t want to be lectured. Advisors have to first listen to clients – their problems, needs and hopes – before offering a professional response. The conversation should flow easily both ways as an advisor and client get to the heart of matters in an atmosphere of mutual respect.

If you are looking for a qualified financial advisor to assist with your financial planning and retirement needs, contact us and we can assist recommending someone in your area. This luxury blog is a great place to follow the latest news in the financial industry.

With the holiday season over, it’s now time to talk about the upcoming tax season. Getting advice from a professional is critical to your financial success.

IRA’s, annuities, stocks, mutual funds, bonds, life insurance, etc …. it can quickly become very overwelming for many people.

The IRS laws are constantly changing and its best to put your hard earned money in the hands of a financial professional – to give you sane advice and peace of mind.

Recent surveys show that IRAs and annuities continue to grow as popular retirement investment options. But beware that there are some significant disadvantages you should be aware of.

CPA Jim Kohles is the chairman of RINA accountancy corporation and states, “Last year, four out of 10 U.S. households had IRA accounts. That’s up from 17 percent two decades ago.” (based on a ICI Research survey). Kohles continues, “But they can be bad for beneficiaries if you have a very large account.”

Annuities are onother popular investment vehicle as they offer a potential guaranteed income stream into the future. In the second quarter of 2013, annuity sales increased by 10 percent.

In addition to Jim Kohles, wealth management advisor Haitham “Hutch” Ashoo of CEO of Pillar Wealth Management and attorney John Hartog of Hartog & Baer Trust and Estate Law all agree that placing large sums of money in either annuities or IRAs can have serious tax consequences for your heirs.

Hartog was quoted, “If you want to ensure your beneficiaries get what you’ve saved, you need to take some precautions.”

The three financial experts provide these helpful suggestions:

• Better understand your assets as you may be worth more than you think. If your estate is worth greater than $5.25 million (for couples, $10.5 million), your beneficiaries at time fo death may face a stiff 40 percent estate tax and federal and state income taxes. CPA Kohles says, “It can substantially deplete the IRA.”

To avoid that, take stock of your assets now – you may have more than you realize when you take into account such variables as inflation and rising property values. Be aware of how close to that $5/$10 million benchmark you are now, and how close you’ll be a few years from now. Kohles adds, “Consider vacation and rental properties, vehicles, potential inheritances.”

Also, take advantage of the lower tax rates you enjoy today, particularly if they’re going to skyrocket after your death. “A lot of people want to pay zero taxes now and that’s not necessarily a good idea,” he says. An example is if you’re at that upper level, consider converting your traditional IRA to a ROTH IRA and paying the taxes on the money now so your beneficiaries won’t have to later.

• Consider spending down your tax-deferred IRA early. If you’re in the group with $5 million/$10 million assets, it pays to go against everything you’ve been taught and spend the IRA before other assets, says attorney Hartog.

• No matter what your estate’s value, avoid investing in annuities. Wealth management adviser Ashoo warns annuities, offered by insurance companies, can cost investors an inordinate amount of money during their lifetime and afterward.

“Insurance companies try to sell customers on the potential for guaranteed income, a death benefit paid to beneficiaries, or a ‘can’t lose’ minimum return, but none of those compensates for what you have to give up,” he says.

That includes being locked in to the annuity for five to seven years with hefty penalties for pulling out early; returns that fall far short of market investments on indexed annuities; high management fees for variable annuities; declining returns on fixed-rated annuities in their latter years; and giving up your principle in return for guaranteed income.

“If you own annuities and have a substantial estate, there are smart ways to unwind them to minimize damage,” Ashoo says.

If you are seeking sound financial or tax advice, please contact The Life of Luxury and we can put you in touch with an investment professional in your area.

There will be a literal mountain of cash raining down on the Baby Boomer generation.  Over the next several years, it is estimated that $10 trillion will be inherited by today’s Baby Boomers.

Due to fact that women outlive men by seven years on average, women will receive the lion share of this wealth will get the bulk of it according to a recent Cornell University study.

So the big question is what to do with all that money? Financial expert Scott T. Schultz, author of Scott Schultz’s Guide to Closed-End Funds has a surprising answer.

Scott T. Schultz was quoted, “Women already control 60 percent of the nation’s personal wealth – they outnumber men and they are traditionally the shoppers.”

Scott T. Schultz has had an exceptionally successful career and is a respected expert on the subject of financial investing. He began his career in 1983 at E.F. Hutton and was ranked the nation’s No. 1 Separate Account Money Manager by USA Today for three consecutive years using GIPS verified/audited performance numbers supplied by Morningstar, Inc. Schultz was a GOP nominee for U.S. Congress in 1988, and met with Presidents Ronald Reagan and George H.W. Bush at the White House.

As the first of the boomers begin reaching the age of 65 this year, the U.S. will see an even greater number of retirement-aged women holding this country’s financial wealth.

“Many will inherit money and property from their parents and/or their husbands, and many will live another 30 to 40 years,” Schultz says, citing the Cornell study. “They’ll need to invest their money to ensure they have enough to avoid that impoverished retirement they fear, but they – and the nation – have lost confidence in the stock market; April 2011 saw the lowest number of investors since 1999.”

According to Schultz, what brokers are not telling their clients is about closed-end funds. Schultz was ranked the No. 1 Separate Account Money Manager for three consecutive years by USA Today. He says these limited-issue stocks are available only in finite numbers and because watchful brokers can find them “on sale,” they’re a better bet as an investment for those who are willing to sit on them awhile.

Why is the American public so in the dark about closed-end funds? Noting his book is the first written on the topic in more than 20 years, Schultz says there are a few reasons:

• Brokers can’t generate a lot of commissions from them. Brokers move open-ended funds quickly because they earn a commission with each transaction. It’s easy money for them, Schultz says. Closed-end funds require a longer term investment strategy, so brokers who want to get rich quick won’t use them.

• They require more effort from the broker, who has to work to find the “sales.” One advantage of closed-end funds is that they can sometimes be purchased at a discount, so the investor starts off ahead of open-end investors who are paying full price for stocks, Schultz says. Even if the fund never gets back up to its full value, any increase at all is a gain. But the broker has to be willing to work to find the good investments with good discounts. And then he or she has to be willing to sit on them.

• Closed-end funds are boring! For a lot of brokers, it’s just plain fun to trade stocks in products and initiatives with an exciting ring to them, whether it’s Facebook or a treasure-hunting ship. These brokers are constantly trading stocks – and generating transaction feeds, lawyer fees and underwriting fees every time – because that’s what they like to do. Closed-end funds require thoughtful, sometimes tedious research before buying, and then the patience of a saint as both the broker and the investor wait for the bid price to increase.

To learn more about Scott T. Schultz and his thoughts on Closed-End Funds, please visit: www.closedendfundguru.com

After the slaughter of the Dot.com bust and stock market free-fall, many people took managing their investments into their own hands.  Mergers-and-acquisitions lawyer Susan Pravda recalls, “I had a money market fund here, a stock brokerage account there, and a bunch of 401(k) plans floating around.” Even she had excellent returns, Pravda still  wonders whether she might have fared better if she had followed her own advice to clients, and hired a pro to help her devise a custom portfolio.

For many professionals, whose careers and family responsibilities demand time and attention, tackling complex financial tasks–such as building an asset allocation model or a long-term wealth plan — may get pushed to the back burner and stay there, even as their wealth levels grow.

Recognizing this, more financial institutions are particularly targeting women as potential clients, offering to professionally manage their investment portfolios.  Putting all your money in someone else’s hands can be unnerving. Do your research and thoroughly understand, who’s managing your money.  Full article