Financial Strategies Your Family Can Trust During Election Cycles

May 23, 2024

Historically, during an election year, general uncertainty about political outcomes leads to a dip in the stock market. Volatility in the stock market is no reason to panic. It’s a natural part of the investing cycle, and it can prompt important planning discussions that can help your family or business prepare for life’s uncertainties.

Surprisingly to many, analysis shows the election has a negligible effect on financial market performance over the medium to long term, irrespective of potential election outcomes.1 Instead, many suggest the market is primarily influenced by broader economic trends rather than election results.

Here are some ways you can set yourself up for greater financial security — regardless of what happens in the stock market or this election cycle.

Tax PlanningOne of the most significant areas in which people miss opportunities is by unnecessarily paying more in taxes than is required by law. This often happens when their wealth advisor isn’t knowledgeable about taxation or fails to collaborate with their CPA. For example, advisors who don’t understand the tax implications of investment portfolio decisions can end up costing clients thousands of dollars in capital gains tax. By working with a tax-smart wealth advisor, you can implement strategies like tax loss harvesting, which uses investment losses to offset gains and avoid paying unnecessary taxes.

Risk ManagementGrowing your wealth requires protecting it because it doesn’t take long for an unexpected expense to set you back. Holistic financial planning should incorporate evaluating insurance policies that can protect your family and finances against future risks. Short-term disability, property and casualty, life and long-term care insurance are all critical to be prepared for the future. A wealth advisor should help you review existing policies, identify gaps in coverage, secure quotes from insurance providers, and make recommendations on the cost and coverage that fit your needs.

Family Leadership PlanningThe creation of a legacy plan to protect your family and estate after you’re gone leaves heirs with greater clarity and confidence about how you want assets distributed. Effective family leadership planning requires working with not only a skilled estate attorney but also a tax-smart wealth advisor to help minimize estate taxes and maximize assets passed on to future generations.

The financial services industry has changed a lot over the years. Technology has evolved to make basic advice more accessible online. Rules and regulations have become increasingly complex as well, and clients’ needs now far exceed mere investment management. Clients need a financial partner who can help them prepare for the future, plan for alternate scenarios, and provide advice in every facet of their financial life. In my opinion, the level of customization, depth of knowledge, and value of services provided by a tax-smart wealth advisor have never been more needed by the public at large.

While elections often bring heightened emotions, they don’t have to cause fear about your long-term financial security. With an integrated financial plan designed around your goals for the future and a tax-smart advisor to capitalize on down-market opportunities, you can feel confident that your financial future is bright — regardless of life’s short-term ups and downs.

The Big Picture
At Wymer Brownlee, we believe in a holistic approach that aims to help you map out important mile­stones—like a house purchase, a child’s college expenses, or your future retirement—and ensure that you are putting enough away for future goals. If you’re looking to talk with an advisor or want a complimentary, no obligation review of your current retirement accounts, I’m just a phone call away.

USBank.com, 2024

Aaron Waters
Shareholder & Wealth Advisor

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