Investors commonly view dividends as a method for creating income. But dividend strategies are not the only method to produce cash flow, and it’s important for investors to understand the tradeoffs when they focus solely on a dividend investment strategy. In this blog post, we lay out what happens to stock prices when dividends are paid out, tax implications of dividends, the volatility of dividend stocks, and ‘creative’ methods companies can use to pay dividends. What Happens to Stock Prices When Dividends are Paid Here’s something investors often miss: When a company pays out dividends, its ..read more

Upcoming Dates for 1099’s 1099-R Forms for Retirement Accounts: If you’ve completed any rollovers from your retirement accounts last year or had a distribution/withdrawal, you’ll receive a 1099-R form. These documents will be sent out January 31st. If you did not make any distributions or withdrawals from your qualified account, you will not receive a 1099. 1099 Composite Forms: For brokerage accounts, the 1099 Composite form is sent out by mid-February. This form consolidates various 1099 reports for your convenience and is used for non-retirement accounts. These 1099s will arrive after the ..read more

“What do you mean I HAVE to take withdrawals??” This is a question we hear a lot! Required Minimum Distributions, also known as RMDs are withdrawals that you need to make from your retirement account, such as a traditional IRA or 401(k) once you reach a certain age. Why RMDs Matter The idea behind RMDs is simple: the IRS doesn’t want us to keep delaying taxes on our retirement funds forever. These mandatory withdrawals make sure that at some point, these savings count towards your taxable income. How Are RMDs Calculated? The IRS uses your life expectancy and the previous year’s account balance ..read more

Recently, the Federal Reserve raised the benchmark borrowing rate to 5-5.25%, which was the 10th increase in over a year[1]. This rise in rates is the last rate increase most members of the Federal Reserve anticipate[2]. In fact, the majority of Reserve members anticipate that interest rates should lower starting in 2024 eventually bringing the rates down to a long-term average of just 2.5% or half of what it is today! What does this mean for investors? Well, if you have excess cash sitting idle in a bank account, now might be the time to consider putting that ‘lazy’ money to work. With rates ..read more

2022 Market review -Although stocks ended with their worst performance since 2008, value stocks served as a bright spot for their second consecutive year, outperforming growth by the largest margin since 2000. For 2022 the MSCI All Country World Value Index fell 7.5% vs. a 28.6% decline for the MSCI All Country World Growth Index. This outperformance helped insulate portfolios that overweight value from the impact of the broader market. -FAANGs (Facebook, Amazon, Apple, Netflix, and Google) saw notable declines in 2022, losing a combined $3.2 trillion in market value. The group collectively un ..read more

Behavioral finance is an essential field that explores the intersection of human psychology and financial decision-making. Recognizing these biases is crucial for investors because these psychological tendencies can cloud judgment, lead to flawed reasoning, and result in sub-optimal financial decisions. For instance, investors may hold onto underperforming assets due to loss aversion or might overtrade because of overconfidence, both of which can erode investment returns. Moreover, biases can prevent investors from seeing the bigger picture. For example, anchoring bias could cause an investor ..read more

Estate planning is not always a fun topic to think about, but it’s an essential part of ensuring that your wishes are carried out in the event of your incapacity or death. A well-crafted estate plan can help protect your assets, minimize taxes, and make sure that your loved ones are taken care of when you’re no longer able to. Here are some best practices to consider when creating your estate plan. Beneficiary Designations: Ensure that you have correctly designated beneficiaries for all your accounts and assets. Many people are not aware that named beneficiaries supersede wills and trusts. Yo ..read more

In 2020, Schwab announced its acquisition of TD Ameritrade, and now after three years, the anticipated transition date will be September 5th of this year! You can rest assured there is little you need to do, and your relationship with us, your advisor, will not change as part of the transition. Schwab will automatically transfer your assets, and you will be assigned a new account number for each one of your accounts. By the end of June 2023, you will be receiving either an email or mail (depending on your preference settings) from Charles Schwab for each of your TD Ameritrade account ..read more

First, let’s start with a brief overview of what capital gains are. Capital gains are profits earned from the sale of an asset, such as stocks, real estate, or artwork. If you sell an asset for more than you paid for it, the difference between the purchase price and the sale price is your capital gain. It is important to note that for investment accounts, the capital gains rate applies only to taxable accounts, such as brokerage accounts. Investments held in tax-deferred accounts or retirement accounts, such as traditional IRAs, Annuities, and 401(k)s, are subject to different tax rules. Now ..read more

The Tax Cuts and Jobs Act (TCJA) brought significant changes to the US tax code in 2017. Among them was the sunset provision of certain TCJA provisions at the end of 2025, which could potentially lead to a rise in taxes. The individual income tax cuts, increased estate and gift tax exemptions, and enhanced bonus depreciation rules for businesses are some of the provisions that will expire at the end of 2025, unless Congress extends them. If these provisions expire and new legislation is not passed, tax rates for individuals will go up in 2026. The federal tax brackets and rates will change as ..read more