If you are ready to retire, entering a second career, caring for aging parents, or have adult children, you won’t want to miss Fairman Group Family Office’s must-read, fictional series about the financial challenges, opportunities and gotcha’s regarding life challenges as an empty nester.
The Next Nest series follows the Carlsons, a fictional
family, who lives on the Main Line. Their three children are grown and out of
the house with families of their own, each navigating their own personal and
financial challenges. As new empty nesters, the Carlsons want to act on available
opportunities and are ready to pursue some of their goals–such as the forever-pushed-back
home renovation project–while also navigating the new challenges that come with
this stage of life.
Read the stories below for real insights and the
financial implications of the opportunities and challenges that come along with
the empty-nester life.
You may have noticed quite a few articles in the news recently about Equity Compensation—usually referring to some astronomical amount of compensation that a CEO is being rewarded. While those articles tend to sensationalize executive compensation, “equity” as compensation is quite common—and you may already be the recipient of one or more types of equity compensation.
Equity compensation is pay in the form of company ownership or stock. It can be awarded instead of, or in conjunction with, regular cash compensation. Many employers consider equity to be a way of aligning an employee’s interest with the goals and growth of the company. It could take the form of:
The Next Nest series features a fictitious family—the Carlsons. In the last issue, James, age 60, an executive with a publicly-held company headquartered in the Philadelphia suburbs and Jeanne, age 58, owner of a small public relations firm, received news that their first grandchild was on the way and sought ways to financially help their children and future grandchild. Now they find themselves in the dead of winter, wondering when they will be financially secure enough to spend their winters someplace warm. Have they saved enough money for James to consider stepping down from his high-paying, high-stress position?
It might make sense to seek advice from a financial professional, so you start your research. Unfortunately, this results in a myriad of confusing titles: Financial Consultant, Financial Advisor, Advanced Retirement Specialist, Wealth Manager, Retirement Counselor, Financial Planner and other variations on the theme. It all seems like a name game.
Since investments are an integral part to your overall plan, a good approach may be to sort prospective advisors by the legal standard of care to which they are held. Those who are acting as a broker or sales agent are held to a “product suitability” standard. This group typically consists of stock brokers and life insurance agents, whose primary function is that of a salesperson; investment advice is merely incidental to their role.
You see and hear it everywhere: Individual stock or fund performance is the most important element of investing. To Fairman Group, this approach is counterproductive to long-term financial success because study after study has concluded that the critical factor is the ‘mix’ of stocks, bonds, and other assets owned. This mix, called asset allocation, is vital to the success or failure of your investment plan.
Here in the U.S., we celebrate the New Year with the Times Square Ball Drop. In Japan, ‘Bonenki’ (forget-the-year parties) are held to bid farewell to the problems and concerns of the past. In the Netherlands, the Dutch burn their Christmas trees in large bonfires—to purge the old and welcome the new.
It seems that investors also have an annual New Year’s tradition—that of cleansing and purging their portfolios. They eagerly await publication of various mutual fund ranking reports. Armed with this data, they rush to analyze their portfolios and prepare a list of ‘must have’ funds selected based on last year’s performance. As a result, their current investment holdings are divided into two camps: “Winners” and “Dogs”.
The 2018 tax season will be here soon. Have you experienced a life event such as retirement, a divorce, a move, a job change, or a transfer of wealth in the past year? In these situations, seeking the professional advice of a qualified tax advisor may be a given. When interviewing a qualified tax advisor, Fairman Group Family Office suggests that you ask the following 5 questions to gain valuable insight into the quality of relationship you can anticipate and how it will impact your overall financial health.
Welcome Back, Empty Nesters! You won’t want to miss Next Nest Volume 2 of Fairman Group Family Office’s fictional series about the financial implications, opportunities and gotchas regarding helping with the purchase of a home, gift exclusion and education expenses!
Read the Article
As the leaves continue to fall and your thoughts turn to family and the holidays, consider what you can do—this year—to lower your tax bill. To help you get ready for tax season, Fairman Group Family Office has prepared some important information regarding: Standard vs. Itemized Deduction Changes, Qualified Business Income (QBI) Deduction, Section 179 Tax Deduction for Businesses, Elimination of Entertainment Expense Deductions, Tried and True Ways to Manage Taxable Income.
Before the new Tax Bill, Fairman Group’s advisors and tax professionals would often get questions about charitable trusts and foundations for those looking to donate substantial assets to charities or looking to create a family legacy. However, now that the new Tax Bill has raised the bar for itemized deductions to $24K for married couples filing jointly, many more individuals should now learn about and consider Donor Advised Funds.