/ by Don Connelly / Investing Wisdom / 0 comments
For most people, there’s little to think about when it comes to making contributions to their 401k plans. They enjoy reduced current taxes, deferred taxes on account earnings, and, for most, a matching contribution from their employer. That’s a huge incentive to contribute as much of their earnings as possible—up to $23,000 in 2024, and those over 50 can add $7,000 in annual catch-up contributions.
But is maxing out 401k contributions really the best retirement savings strategy for your clients?
While deferred taxation in a 401k is great for capital accumulation, they will owe ordinary income taxes on their withdrawals, impacting their cash flow in a critical life stage. Many retirees are shocked by the amount of taxes they owe on their retirement income.
Read more
10 Timeless Guiding Principles Every Advisor Should Share with Clients
/ by Don Connelly / Investing Wisdom / 0 comments
Markets swing, headlines scream, but great advice stands firm. Clients don’t just need portfolio updates; they need steady principles to cut through the noise, calm their fears, and keep them anchored to their goals. As an advisor, you’re not just managing money; you’re guiding people through uncertainty.
These 10 timeless principles are your go-to list for client conversations, reviews, or whenever doubt creeps in. They’re simple, enduring truths that build trust and focus, no matter the market’s mood.
Read more
Why Collaborative Financial Planning Keeps Clients Focused on Long-Term Goals
/ by Don Connelly / Managing the Relationship / 0 comments
One of the biggest challenges financial advisors face during volatile markets is the tendency of clients to focus on short-term market fluctuations, often making impulsive decisions despite repeated discussions about their long-term goals.
The issue isn’t a lack of clear communication or financial education on the part of advisors—it’s a lack of client involvement in the planning process. When clients are passive recipients of a plan, they’re less committed to it and, therefore, more susceptible to short-term myopia.
Collaborative financial planning changes this by making clients co-creators of their strategy. By actively participating in the process, clients develop a deeper sense of ownership, fostering resilience and a focus on their long-term vision.
Read more
How to Educate Clients About the Importance of Investing Beyond Their 401(k)
/ by Don Connelly / Investing Wisdom / 0 comments
For most people, there’s little to think about when it comes to making contributions to their 401k plans. They enjoy reduced current taxes, deferred taxes on account earnings, and, for most, a matching contribution from their employer. That’s a huge incentive to contribute as much of their earnings as possible—up to $23,000 in 2024, and those over 50 can add $7,000 in annual catch-up contributions.
But is maxing out 401k contributions really the best retirement savings strategy for your clients?
While deferred taxation in a 401k is great for capital accumulation, they will owe ordinary income taxes on their withdrawals, impacting their cash flow in a critical life stage. Many retirees are shocked by the amount of taxes they owe on their retirement income.
Read more