WrapManager's Wealth Management Blog

In November 2010, Charles Schwab acquired the assets and intellectual property of Winward Investment Management (now operating under the name Windhaven Investment Management). In doing so, Schwab now offers the three Windhaven money manager strategies to its retail clients, providing a distinct approach to investing for growth and risk management. The Windhaven strategies have grown in popularity since Schwab’s acquisition, though many investors may be unsure of how each strategy differs in its approach.1 Which of the Windhaven Investment Management strategies is right for you? [+] Read More

One of the great things about setting up beneficiaries on your retirement and other investment accounts is that you can set them up virtually any way you want. You can relinquish complete control of your assets, or you can set up systems to maintain some control over how the assets are distributed. The choice is yours. When deciding how to assign beneficiaries on your retirement and other investment accounts (including your IRA beneficiaries), there are a few important considerations. Here are five questions to discuss with your financial advisor when discussing setting up your beneficiaries. [+] Read More

You control many of the decisions leading into retirement: how much to save, what investments to make, how long you choose to work. But there are other factors – like market returns and policies regarding taxation, savings, and entitlements – that you can’t completely control. Or can you? The key word here is “completely” – with the right kind of investment planning, you can regain control of some of those less predictable aspects of retirement planning. Planning For Things You Can't Control (Click image for larger version) Source: The Importance of Being Earnest, J.P. Morgan Asset Management, 2013. [+] Read More

Does your Required Minimum Distribution (RMD) exceed your living expenses this year? Or perhaps your income from rental properties, an investment portfolio, or a pension is generating extra cash flow beyond what you need. Here are three smart ways to keep those assets working for you: 1) Re-Invest Your Assets to Help Them Grow Get more out of your money by investing extra cash in your taxable brokerage account, IRA or other retirement accounts, which you can do if you meet certain requirements. (Your financial advisor can help you determine your eligibility.) If your extra income comes from RMDs, your financial advisor may be able to help you fulfill your required distribution by transferring stocks from your IRA into your taxable account. Instead of taking that money in cash, you can fulfill your RMD and stay invested in the market. Another option may be to transfer cash or stock to a qualified charity, in which case charitable giving rules may apply. [+] Read More

If you’re thinking about moving to a different state, it’s important to consider how your health care costs could change depending on where you end up. The average cost for Medicare, Medigap and nursing homes could become cheaper, or more expensive. The following two maps of the United States illustrate the average cost for each based on state. On one level, the cost of Medicare and comprehensive Medigap plans varies from state to state. Medicare and Medigap Average Annual Cost per State at Age 65 (Click image for larger version) Source: JP Morgan Asset Management. SelectQuote, 2013. Traditional Medicare costs are based on national average cost estimates for Medicare Parts A, B, D and Medigap Plan F. Vision, dental and long-term care expenses are not included. Not shown on the chart: costs for Medicare Advantage. Medicare Advantage costs may vary from less than $500 per year to more than $10,000 per year. Data for Alaska and Hawaii not available. [+] Read More

If you had a good investment year, perhaps you had to pay a chunk of taxes on capital gains, interest, and dividends earned. Taxes are taxes, but we’re writing to show you a few ways you might be able to get some of that money back. Here are four investment-related expenses that may be tax deductible for you: 1) Financial Advisor Fees These can include investment management fees paid to your money managers or financial advisors, and can also include paid-for services like subscriptions to newsletters. 2) IRA Custodial Fees For annual or maintenance fees associated with holding your IRA at a custodian. One key item to note: these fees may only be tax deductible if you pay them with cash from an account different than your IRA. [+] Read More

When mapping out the sources and timing of your retirement income payments, there’s an important risk we want to make investors aware of: withdrawing money from your portfolio during down markets. If you’re not careful, withdrawing money while the market declines can significantly impact your portfolio and your ability to meet your long-term retirement goals. This risk is especially palpable if you’re in the early stages of retirement, because it can be difficult to replenish your portfolio over time. During down markets, investors should consider adjusting their withdrawal rates and exploring other sources of retirement income. [+] Read More

Many banking institutions now undergo annual stress tests to ensure they’re strong enough to survive another global financial crisis. Looking back, we now know that many banks appearing healthy and operational on the surface actually needed help. Had they conducted stress tests regularly, they may have just survived. As advisors, these bank stress tests and bank failures highlight a valuable lesson when it comes to investment plans—they too should be stress-tested to make sure they can endure future market volatility. Have you checked to see if your investment portfolio can survive another large market decline? Who performs annual stress tests on your portfolio to make sure you’re on the right track? * The Confidence Zone is the range of probabilities that you and your advisor select as your target range for the Probability of Success result in your Plan. Source: Money Guide Pro It’s important to know how your retirement goals and portfolio could be affected during the next market decline. Armed with this information, you can make adjustments so you’re better prepared. Go through these 4 steps to perform a stress test on your portfolio so you know you’re prepared. [+] Read More

Are you thinking of retiring soon, but are still unsure about when you should take Social Security retirement benefits? Here’s something you may not have known before: the Social Security retirement benefit system is set up to incentivize people to delay collecting benefits. If your financial situation enables you to delay collecting benefits, it could make a lot of sense for you to wait. Here’s a great introductory graphic that can help frame your thinking: Social Security Timing Tradeoffs (Click chart for larger version) Source: Social Security Administration, J.P. Morgan Asset Management. For illustrative purposes only. For 1955 - 1960, two months are added to the Full Retirement Age each year. [+] Read More