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Contributing to a 401(k) or Roth IRA does not automatically mean you are invested in the market. Over the last few months, I have seen many retirement accounts holding cash-like investments. This can result in a significant difference—potentially costing you hundreds of thousands of dollars—if your funds are not invested in the stock market. It's crucial to regularly review and assess your investments to ensure they align with your long-term financial goals. See thrivent .com/social for more information.
Contributing to a 401(k) or Roth IRA does not automatically mean you are invested in the market. Over the last few months, I have seen many retirement accounts holding cash-like investments. This can result in a significant difference—potentially costing you hundreds of thousands of dollars—if your funds are not invested in the stock market. It's crucial to regularly review and assess your investments to ensure they align with your long-term financial goals. See thrivent .com/social for more information.
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How Much Money Can You Save in Interest by Making a Larger Down Payment on a House? The minimum down payment for a house is currently 3%, while "conventional wisdom" recommends putting down 20%. Let's look at the potential interest savings with different down payment amounts based on a 30-year mortgage, a 7% interest rate, and a $300,000 house. 3% down payment: $405,971.02 in interest 5% down payment: $397,602.26 in interest 20% down payment: $334,817.84 in interest In this example, putting 20% down on a mortgage saves over $70,000 in interest. Additionally, this doesn't account for private mortgage insurance (PMI), which is required until you reach 20% equity. However, when buying a home, it's crucial to ensure you have plenty of cash reserves for unexpected expenses. Jumping into a home purchase before you're financially ready can put unnecessary strain on your financial plan. See thrivent .com/social for more information.
How Much Money Can You Save in Interest by Making a Larger Down Payment on a House? The minimum down payment for a house is currently 3%, while "conventional wisdom" recommends putting down 20%. Let's look at the potential interest savings with different down payment amounts based on a 30-year mortgage, a 7% interest rate, and a $300,000 house. 3% down payment: $405,971.02 in interest 5% down payment: $397,602.26 in interest 20% down payment: $334,817.84 in interest In this example, putting 20% down on a mortgage saves over $70,000 in interest. Additionally, this doesn't account for private mortgage insurance (PMI), which is required until you reach 20% equity. However, when buying a home, it's crucial to ensure you have plenty of cash reserves for unexpected expenses. Jumping into a home purchase before you're financially ready can put unnecessary strain on your financial plan. See thrivent .com/social for more information.
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For individuals with doctoral degrees, balancing a high income with a substantial amount of student debt can be challenging. Here are some common mistakes to watch out for: 1. Not Making a Plan for Paying Off Debt: I've spoken with many individuals who have "no plans on paying more than the minimums" or say "I'll likely retire with those loans." Consider exploring options including a fast payoff, PSLF, SAVE, and other repayment strategies that may make sense for your situation. 2. Lifestyle Creep: When people suddenly start making significantly more money, it is easy to fill your cash flow with a large mortgage payment, car payments, and general extra spending. Enjoying your income is good, but it's crucial to prioritize other financial goals first to ensure long-term stability. 3. Delayed Retirement Savings: Many start saving for retirement 4-15 years later than others. As a result, you will need to be more aggressive with the percentage of income you set aside, given the fewer years ahead for compound growth. 4. Neglecting Tax Planning: High earners and business owners have more opportunities to reduce their lifetime tax bill. Effective tax planning can significantly improve your financial plan. Navigating these and additional issues requires a proactive approach. Our team is here to help you create a plan that secures your financial future. See thrivent .com/social for more information
For individuals with doctoral degrees, balancing a high income with a substantial amount of student debt can be challenging. Here are some common mistakes to watch out for: 1. Not Making a Plan for Paying Off Debt: I've spoken with many individuals who have "no plans on paying more than the minimums" or say "I'll likely retire with those loans." Consider exploring options including a fast payoff, PSLF, SAVE, and other repayment strategies that may make sense for your situation. 2. Lifestyle Creep: When people suddenly start making significantly more money, it is easy to fill your cash flow with a large mortgage payment, car payments, and general extra spending. Enjoying your income is good, but it's crucial to prioritize other financial goals first to ensure long-term stability. 3. Delayed Retirement Savings: Many start saving for retirement 4-15 years later than others. As a result, you will need to be more aggressive with the percentage of income you set aside, given the fewer years ahead for compound growth. 4. Neglecting Tax Planning: High earners and business owners have more opportunities to reduce their lifetime tax bill. Effective tax planning can significantly improve your financial plan. Navigating these and additional issues requires a proactive approach. Our team is here to help you create a plan that secures your financial future. See thrivent .com/social for more information
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Trillions of dollars have moved into high-yield savings accounts and money market mutual funds with the current high interest rates. With many rates currently exceeding 5%, many of my clients have been capitalizing on this opportunity. However, the prospect of rate cuts looms on the horizon. Despite the impending changes, most individuals won't adjust their investment strategies until they are dissatisfied with the rates. Unfortunately, by that time, it may prove challenging to find favorable rates in the fixed income market. For clients with a longer investment horizon and a desire for increased returns, it may be prudent to consider adjusting their portfolios to include longer-duration assets. See thrivent .com/social for more information
Trillions of dollars have moved into high-yield savings accounts and money market mutual funds with the current high interest rates. With many rates currently exceeding 5%, many of my clients have been capitalizing on this opportunity. However, the prospect of rate cuts looms on the horizon. Despite the impending changes, most individuals won't adjust their investment strategies until they are dissatisfied with the rates. Unfortunately, by that time, it may prove challenging to find favorable rates in the fixed income market. For clients with a longer investment horizon and a desire for increased returns, it may be prudent to consider adjusting their portfolios to include longer-duration assets. See thrivent .com/social for more information
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Recently, while speaking with a pre-retiree, we covered some "basics" including reviewing their beneficiaries. To their surprise, the beneficiary listed on their retirement account was an ex-spouse from 20 years ago. Despite updating their estate plan, this critical detail had been overlooked. It's important to remember that if your will states that someone will receive an asset, but the asset’s beneficiary designation says otherwise, the listed beneficiary generally takes precedence over the will. This means that the beneficiary named on the account or policy will override the directives in your will. Ensure your beneficiary designations are current and reflect your wishes. Don’t assume everything is up-to-date—take the time to review these designations regularly to avoid unintended consequences. See thrivent .com/social for more information
Recently, while speaking with a pre-retiree, we covered some "basics" including reviewing their beneficiaries. To their surprise, the beneficiary listed on their retirement account was an ex-spouse from 20 years ago. Despite updating their estate plan, this critical detail had been overlooked. It's important to remember that if your will states that someone will receive an asset, but the asset’s beneficiary designation says otherwise, the listed beneficiary generally takes precedence over the will. This means that the beneficiary named on the account or policy will override the directives in your will. Ensure your beneficiary designations are current and reflect your wishes. Don’t assume everything is up-to-date—take the time to review these designations regularly to avoid unintended consequences. See thrivent .com/social for more information
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If you are a grandparent, you should consider funding your grandchild's 529 college savings plan. There are a lot of benefits to this, but there is now a "grandparent loophole" which makes it even more advantageous. Before the 2024-2025 school year, any tuition payments from grandparents' 529 plans would lessen financial aid eligibility for the student. This would disincentive grandparents from assisting. That has now been removed! Here are some other notable benefits. - 529 contributions can help reduce your estate tax, while also avoiding the generational skipping transfer tax. - It can help minimize state income tax, with tax-deferred investment growth for the student. See Thrivent .com/social for more information. Offered through a brokerage arrangement with Thrivent Investment Management Inc. 529 college savings plans are not guaranteed or insured by the FDIC and may lose value. Consider the investment objectives, risks, charges, and expenses associated before investing. Read the issuers official statement carefully for additional information before investing. Investigate possible state tax benefits that may be available based on the state sponsor of the plan, the residency of the account owner, and the account beneficiary. Consult with a tax professional to analyze all tax implications prior to investing.
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If you are a grandparent, you should consider funding your grandchild's 529 college savings plan. There are a lot of benefits to this, but there is now a "grandparent loophole" which makes it even more advantageous. Before the 2024-2025 school year, any tuition payments from grandparents' 529 plans would lessen financial aid eligibility for the student. This would disincentive grandparents from assisting. That has now been removed! Here are some other notable benefits. - 529 contributions can help reduce your estate tax, while also avoiding the generational skipping transfer tax. - It can help minimize state income tax, with tax-deferred investment growth for the student. See Thrivent .com/social for more information. Offered through a brokerage arrangement with Thrivent Investment Management Inc. 529 college savings plans are not guaranteed or insured by the FDIC and may lose value. Consider the investment objectives, risks, charges, and expenses associated before investing. Read the issuers official statement carefully for additional information before investing. Investigate possible state tax benefits that may be available based on the state sponsor of the plan, the residency of the account owner, and the account beneficiary. Consult with a tax professional to analyze all tax implications prior to investing.
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Wondering if your social security income will be taxable? It depends on your income in retirement! - If your total income is $25,000 to $34,000 for a single filer ($32,000 to $44,000 if married filing jointly), 50% of your benefit will be taxed. - If your total income is greater than $34,000 for a single filer ($44,000 for a couple), up to 85% of your benefit is taxable. That calculation for your total income is as follows. Adjusted gross income + nontaxable interest + half of your social security benefits. See thrivent .com/social for more information
Wondering if your social security income will be taxable? It depends on your income in retirement! - If your total income is $25,000 to $34,000 for a single filer ($32,000 to $44,000 if married filing jointly), 50% of your benefit will be taxed. - If your total income is greater than $34,000 for a single filer ($44,000 for a couple), up to 85% of your benefit is taxable. That calculation for your total income is as follows. Adjusted gross income + nontaxable interest + half of your social security benefits. See thrivent .com/social for more information
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While 2023 is behind us, making 2023 contributions toward your Roth IRA is not too late! Until April 15th, you can contribute up to $6,500 for last year or $7,500 if you're 50 or older (income dependent). Thrivent and its financial advisors and professionals do not provide legal, accounting or tax advice. Consult your attorney or tax professional.
While 2023 is behind us, making 2023 contributions toward your Roth IRA is not too late! Until April 15th, you can contribute up to $6,500 for last year or $7,500 if you're 50 or older (income dependent). Thrivent and its financial advisors and professionals do not provide legal, accounting or tax advice. Consult your attorney or tax professional.
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With investing, it's essential to differentiate between risk tolerance and risk capacity. You may only feel comfortable with a small amount of risk, but you may need more to reach your financial goals. Say you are a conservative investor and are worried about a potential downfall in the market- you would have a low-risk tolerance. But if your financial goals require large amounts of growth in your investments- your risk capacity may conflict with your gut feeling. Finding that balance can make investing difficult, as it is easy to let emotions dictate our decisions. See thrivent .com/social for more information.
With investing, it's essential to differentiate between risk tolerance and risk capacity. You may only feel comfortable with a small amount of risk, but you may need more to reach your financial goals. Say you are a conservative investor and are worried about a potential downfall in the market- you would have a low-risk tolerance. But if your financial goals require large amounts of growth in your investments- your risk capacity may conflict with your gut feeling. Finding that balance can make investing difficult, as it is easy to let emotions dictate our decisions. See thrivent .com/social for more information.
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If you have a large traditional IRA or 401K, you have a large tax problem. The IRS has a stake in a portion of your account, and it's a matter of when they will receive it. Here are a few questions to consider. 1. What will tax rates look like when you take distributions? Rates are currently projected to increase in 2026 when the Tax Cut and Jobs Act sunsets from our current low rates. 2. Large pre-tax retirement accounts create large required minimum distributions. This may push you into a higher tax bracket and is not a problem that goes away. 3. When you pass with a traditional IRA/401K, it can push your spouse or your beneficiaries into a higher tax bracket. There are many ways to minimize this risk, so make sure that tax efficiency is a part of your plan. See thrivent .com/social for more information.
If you have a large traditional IRA or 401K, you have a large tax problem. The IRS has a stake in a portion of your account, and it's a matter of when they will receive it. Here are a few questions to consider. 1. What will tax rates look like when you take distributions? Rates are currently projected to increase in 2026 when the Tax Cut and Jobs Act sunsets from our current low rates. 2. Large pre-tax retirement accounts create large required minimum distributions. This may push you into a higher tax bracket and is not a problem that goes away. 3. When you pass with a traditional IRA/401K, it can push your spouse or your beneficiaries into a higher tax bracket. There are many ways to minimize this risk, so make sure that tax efficiency is a part of your plan. See thrivent .com/social for more information.