WrapManager's Wealth Management Blog

With less than a month left in the year, time is running out to make adjustments to your IRAs that count towards this tax year. Here is a short checklist of IRA actions to consider before year-end, but please note that this list is by no means comprehensive. We would strongly recommend reaching out to a financial advisor between now and the end of the year to make sure you’re in good shape going into the New Year. [+] Read More

Quizmaster, Doug Hutchinson, presents his quiz for the month. Here, Doug discusses strategies for tax efficient withdrawals. Consider this Scenario: Your friend Robert is a retiree who is facing an unexpected expense of $4,000. To meet this unexpected expense, he will need to take a withdrawal from either his taxable investment account or his tax deferred Individual Retirement Account (IRA). Robert’s taxable account and his IRA are the same size and have the same allocation of investments. Robert faces an income tax rate of 25%. Assume any capital gains realized in a taxable account are long term gains and are taxed at 15%. Assume his cost basis of holdings in his taxable account is 10% below the potential sale price of the holdings. Assume Robert is 72 years old and has already fulfilled his Required Minimum Distribution (RMD) for his IRA for the year. Robert asks you: “Should I take the $4,000 withdrawal from my taxable account or from my IRA? Or should I be indifferent on where the $4,000 is coming from?” [+] Read More

Economic warming and political warnings... Short-term interest rates remain extremely low given the relative health of both the U.S. and global economies. 2017 should be a year of global economic warming but also one of growing risks. However, with cash paying less than nothing in real terms in most of the world, investors should still be overweight long-term assets, with a tilt toward those that should do best in a world with somewhat stronger growth, higher inflation and higher interest rates. [+] Read More

For many investors and retirees, the task of navigating Social Security is often a tricky (and sometimes confusing) undertaking. In fact, it is complex to the point that Fidelity Investments recently brought to light several “myths” about Social Security, which are really misunderstandings more than anything else. In several surveys, Fidelity found that investors had misconceptions about some of the key features and rules surrounding Social Security Retirement Benefits. These misconceptions can cost retirees money over time, so it’s important to work with a financial advisor when making the important decisions about when and how to take your benefit. [+] Read More

U.S. equity indexes hit records; U.S. dollar index surges to nearly 14-year highs. Richard Turnill, BlackRock’s Global Chief Investment Strategist, summarizes the week highlights news to watch in the week ahead. Read an excerpt of his weekly commentary below, or download the complete commentary as a PDF. [+] Read More

If the answer is “yes,” you are among the 67% of parents who said that saving for their kids’ college education is more important than saving for retirement, according to an August 2016 T. Rowe Price Survey. The survey also produced some other insightful, “you’re not alone” data: T. Rowe Price found that 28% of parents have student loan debt (either for their kids or themselves), and 5% have student loan debt for both. The survey also revealed the average amount of student debt for parents that participated in the study was $27,078 – and that’s just for the parents themselves. The average amount of student loans for their kids was $10,768.1 [+] Read More

Daniel Peris, Ph.D., CFA and Head of Strategic Value Dividend Team, answers questions about the the Federated Strategic Value Dividend Strategy including: Overview of the Federated Strategic Value Dividend Strategy How the strategy is performing in the current rising-rate environment What is the outlook and positioning strategy over the next 3 to 6 months [+] Read More

Have you ever wondered whether your portfolio was optimally allocated or not? Or, in other words, do you ever sit back and think: “is there a better way I could have invested my portfolio over the last 20 years?” With the benefit of hindsight, we know that there is almost always a “better way” we could have invested. But unfortunately we do not have the benefit of hindsight with investing! We can only take the information we have available and make what we think are the best decisions possible for our long-term goals. [+] Read More

How Policy and Politics Shape the Global Outlook for 2017 As the dust settles from the U.S. presidential election, what might investors expect in the coming year? New U.S. leadership working with a Republican-unified Congress likely will have a meaningful impact on U.S. investment values, especially if legislation involving infrastructure spending, repatriation of U.S. corporate foreign cash, and tax reform become early priorities in 2017. Just as influential will be macro factors that weigh on global growth and interest rates. The uncertainties of the “Brexit” process, as the United Kingdom negotiates its separation from the European Union (EU), the related tilt toward protectionism in many nations, the pursuit of currency weakness by major non-U.S. economies, and continued “lower for longer” interest-rate policy should combine to support interest in U.S. investments. Differences between the U.S. economy and many advanced economies with regard to monetary policy, currency movement, and economic growth may define investor preferences among many asset classes in 2017. Here, we survey what 2017 may bring for major global economies—and key U.S. investment categories. Read on for a summary of their analysis, or view the entire document here. [+] Read More