Mid-Term Financial Strategies You Can Trust

September 9, 2022

Historically during an election year, mid-term or otherwise, general uncertainty about political outcomes leads to a dip in the stock market. This year, we’ve seen already-volatile markets, and continued fluctuations are to be expected. However, 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 help families and businesses prepare for life’s uncertainties.

Mexican businessman and entrepreneur Carlos Slim Helu once said, “With a good perspective on history, we can have a better understanding of the past and present, and thus a clear vision of the future.”

So, as we enter fourth quarter, what are some ways you can set yourself up for greater financial security — regardless of what happens in the stock market?

Tax PlanningOne of the most significant areas 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 fits 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. There have been downturns and financial crises and global pandemics that kept people from seeking a financial advisor — due to fear or distrust or merely stay-at-home orders. However, rules and regulations have become increasingly complex as well, and clients’ needs now far exceed mere investment management.

Clients need a financial partner that 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 and can increase volatility in the stock market, 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.

Blog by Kyle Brownlee, CEO and Senior Wealth Advisor

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