In talking with clients about the benefits their employer provides during the open enrollment season, one often overlooked benefit if clients have dependents is the Dependent Care Flexible Spending Account (FSA).
Health Savings Accounts (HSAs) are not only a savvy investment option but also offer numerous benefits, especially for high-net-worth families. An HSA is a tax-advantaged savings account designed for individuals with high-deductible health plans (HDHPs) to help cover out-of-pocket medical expenses. While the utility of HSAs is universal, they hold advantages for high-net-worth families and have steadily grown in popularity since their inception.
Earlier this year, I explained two principles you can follow to obtain the most happiness from your spending https://www.highlandplanning.com/learning-center-1/how-money-can-buy-happiness-part-1. In today’s article, I will cover three more concepts that can help bring more joy in your life with your spending. Below are the five principles outlined in the book Happy Money.
In a previous article titled “The Estate Planning Essentials”, I identified the documents needed for a comprehensive estate plan. Although this can be a morbid topic most want to avoid thinking about, reviewing the documents not only ensures your financial legacy is passed in accordance with your wishes as smoothly as possible but guides your agent to ensure your medical and financial wishes are addressed. So, how often should you review your estate planning documents?
Our prayers and thoughts are with the Ukrainian people who are suffering immeasurably at the hands of the Russian military today. To characterize this as "geopolitical risk" that will impact our portfolios seems insensitive. Millions of Ukrainian people woke up today with plans to go to school and work, meet up with friends, or start vacations, and instead have bombs falling on their cities as Russia commits to war on their land.
As we head into the throes of tax season, investors will be getting a slew of tax documents to report on their tax returns. Tax filing can be complicated even further by adding equity compensation into the equation because there can be (1) multiple tax reporting forms for one transaction, (2) different tax treatments based on the type of compensation (3) specific rules for varying strategies.
An incentive stock option (ISO) is a form of equity compensation where the employee has the right to buy shares of the company at a discounted price with special tax treatment. An ISO is a long-term incentive that replaces cash compensation and encourages employees to contribute to the company’s growth and development, hoping the options grow in value over time.
Around this time of year, investors may notice a drop in value in their mutual fund positions due to the funds paying out their annual capital gains distributions. It is important to realize that when this payout occurs, it will cause a drop in the fund's value since the fund's share price is reduced by the capital gains distribution, making it appear that the fund lost value.
Recently there has been considerable debate about providing investors with less than $5 million opportunities to invest in private equity (PE). A prior SEC chairman said, “the requirement that allows only wealthy investors access to PE does not provide the same investment opportunities to smaller investors.”
According to a recent article by the Associated Press, 2020 is shaping up to be one of the best IPO markets in over two decades. While traditional initial public offerings continue to be the primary avenue companies use to raise money and have their shares listed on a major exchange such as the New York Stock Exchange or Nasdaq, the process is not without drawbacks. Other alternatives to bring companies to market have been tested over the years, such as Dutch auctions (Google, 2004), Direct Public Offerings and Special Purpose Acquisition Companies, or SPACs.
One question I often hear is: With the market being so unpredictable, how can we properly plan for the long-term? A global pandemic, upcoming elections, trade tariffs, record unemployment, GDP in freefall, there is no shortage of reasons why the market could be declining this year. Yet, the stock market is not falling, it continues to push higher, led by the information technology and consumer discretionary sectors. Over the last year, out of the 11 sectors of the economy, only consumer staples and energy lagged the S&P 500.
With over $5 trillion in 401(k) plans across the United States as of 2019, this qualified retirement plan's continued popularity is without question. Although the amount of 401(k) money invested in company stock has declined in recent years, according to the Investment Company Institute, investors still have about 6% of plan assets concentrated in their employer's stock.
In the last two weeks, big news items were the announcements from Apple and Tesla that they will be splitting their stock on August 31st. Apple will split its stock 4 to 1, meaning you will receive four shares for every share you own as of August 24th. The split will be Apple's fifth stock split in forty years. Tesla will split their stock 5 to 1 by issuing an additional four shares in a dividend for every share you own as of August 21st.
In my last article, I touched on how the behavioral challenge of loss aversion can be detrimental to investors. By causing people to resist making intelligent strategic moves in their portfolio out of fear of recognizing a loss, the result may be investment underperformance over the long run. Today we are going to briefly look at another common behavioral challenge investors face, namely overconfidence.
Inflation has been a popular topic of late.
In his press conference to announce the Fed’s decision to cut interest rates following its July meeting, Fed Chair Powell cited “muted inflation pressures” as justification for action.
However, retaliatory tariffs between the U.S. and China have raised concerns this could spark inflationary pressures as consumers are forced to pay higher prices.
It’s not every day a “Jeopardy!” contestant becomes a household name and makes one of the longest running television game shows must watch TV. But that’s exactly what happened during James Holzhauer’s 32-game winning streak. Throughout Holzhauer’s dominant run, it seemed to be only a matter of time before he became the highest-winning contestant in “Jeopardy!” history, a record held by Ken Jennings. Jennings amassed a total of $2,520,700 over his 74-game winning streak in 2004. However, Holzhauer was defeated in his 33rd game, coming just $58,484 shy of Jennings’ record.
As we highlighted in our post “Anatomy of the U.S. Economy,” consumer spending accounts for nearly 70% of U.S. gross domestic product (GDP). Current consumer spending, as well as future spending, is highly influenced by consumer expectations for the economy.
The U.S. economy is on the verge of breaking the record for the longest stretch of economic expansion in U.S. history. Since the U.S. economy hit bottom in June 2009 following the Great Recession, it has been on a slow and steady recovery that has it on the brink of surpassing the expansion from March 1991 to March 2001 as the longest in U.S. history.
For the past 18 months, two hot button issues for investors have been the Fed and trade negotiations between the U.S. and China. These two issues were the catalysts for two market corrections in 2018, the latter of which nearly approached bear market territory. However, for the first five months of this year fears of a Fed misstep were alleviated and reported positive progress towards a trade deal between the U.S. and China spurred markets to new all-time highs.
On Friday, Uber went public in the what is the biggest initial public offering (IPO) so far this year. Earlier this month, Beyond Meat went public with less hype and saw its price skyrocket 163% in its first trading day, making it the best-performing first-day IPO in nearly two-decades. Beyond Meat is a producer of plant-based meat substitutes founded in 2009. The company’s Beyond Burger is sold at Whole Foods and restaurants chains around the country.
