Reed Family Finance

Find Your Own Taxable 'Sweet Spot'

What I want to focus on today is what I like to call the “sweet spot” of our tax lives. The “sweet spot” is that short time in our adult lives when many taxpayers fall into a lower tax bracket, after having retired from full-time jobs. Think about it: we stop receiving a salary and, if we have planned well and are able to wait to tap into our tax-deferred accounts, and can also delay collecting Social Security as long as possible, we will potentially find ourselves in a much lower tax bracket for a few years. But for many retirees, this period of low taxable income won’t last. [...]

Seriously, What Is Your Best Interest?

Once the new rule becomes effective and is implemented, all advisors must act in the best interests of their clients if they are offering investment advice on any kind of retirement account. Of course, wouldn’t you think that should have always been the requirement? As a result, we have had a lot of people come to our office asking questions about their current investment plan and whether their advisor is doing what is best for them. [...]

What Are Your Rules? Learn From Ray Dalio

Through my evaluation of their current portfolio, I determined that they have a traditional 60/40 split between stocks and bonds. This model is very common within the brokerage world and with “do-it-yourself” investors. The theory is that when stocks go down, bonds go up, and vice versa. And by having a “balanced” portfolio an investor can minimize risk. Sounds good, right? But what happens if just about every asset class falls, and falls fast, just like they did in 2008? [...]

How 'Modern' Is Your Portfolio?

The Modern Portfolio Theory (MPT) was created by Harry Markowitz back in 1952 and often is the “go-to” strategy for many retail advisors and do-it-yourself investors. It is an investment theory based on maximizing expected returns based on a given level of risk. MPT was designed for risk-averse investors, and Mr. Markowitz was one of the first to quantify the benefits of investing in multiple, uncorrelated stocks, rather than investing in an individual stock. He theorized that investors, who generally want [...]

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