This year was one for the history books. So, as 2020 comes to a close, we’re taking a look back at the top 10 articles of the year from Wealth Enhancement Group, as chosen by our readers. Browse our “Best of 2020” articles below to revisit your personal favorites or discover something you may have missed.
Articles are organized by topic, so scroll through the list below to find the content that’s most relevant to you.
Planning for Your Dream Retirement
3 Common Roth Conversion Tax Questions Answered
Roth conversions can be a powerful tool to save on taxes in retirement. Yet, even with that goal in mind, many people don’t pay enough attention to the taxes incurred from the Roth conversion itself. How is a Roth IRA conversion taxed? We answer the most common tax questions for people moving money into a Roth IRA.
6 Essential Tax-Loss Harvesting Tips
Tax-loss harvesting allows you to limit the recognition of short-term capital gains that are typically taxed at a higher federal income tax rate than long-term capital gains. Tax-loss harvesting cannot restore losses, but it can mitigate them. In short, you can sell Security A at a loss to offset the capital gains tax liability on Security B and lower your personal taxes—if the sales meet certain conditions. With that in mind, learn six essential tax-loss harvesting tips.
3 Things You Need to Know Before Claiming Social Security Benefits
Some people may dismiss Social Security as only playing a minor role in their overall retirement income plan. But the reality is that 50% of married, retired workers depend on Social Security to comprise at least half of their monthly income (that jumps to 70% for unmarried persons). What’s more, 21% of married couples and about 45% of unmarried persons rely on Social Security for 90% or more of their income. With Social Security playing a critical role for so many retirees, it’s important to make the most of these benefits.
The 6 Ps of Prudent Investment Management
Successfully managing your investments is challenging. With so much uncertainty in the markets, it can be easy to simply keep score and fall into the Investment Performance Trap. But the future is unknowable, and prudent investors understand that they have no control over the markets. Instead of focusing on and fretting about what they can’t control, they focus on what they can control. And what they can control can be summed up as the six “Ps” of prudent investment management.
Strategies for Highly Compensated Employees
Non-Qualified Stock Options Taxation
If you've been offered stock options as part of your compensation package, you probably have a lot of questions about if, when and how to exercise them. Stock options can be a powerful investment tool because they allow you to purchase stock in your company at a discounted rate. However, they also come with risk and potentially significant tax consequences. Learn the ins and outs of non-qualified stock options (NSOs) to find out how to get the highest return on your investment.
5 Common Questions About Deferred Compensation
You’ve heard the adage “it takes money to make money.” That is very often true. Similarly, it takes income to pay income taxes. If you are in a position where you are offered deferred compensation, you may have the opportunity to pay less in income taxes and have more money when you need it the most. Find out what deferred compensation is and learn how/when it can be an ideal strategy.
ESPP Tax Rules: What You Need to Know
If you are in a position where part of your compensation package includes access to an Employee Stock Purchase Plan (ESPP), it could provide an easy way for you to purchase company stock. Purchases done through an ESPP can be set up as automatic after-tax payroll deductions and could come with added benefits like discounts on market price or lookback provisions. Sounds like a good idea, right? Unfortunately, it’s not as straightforward as it sounds. Get the essentials on how participating in your company’s ESPP can affect your financial plan.
Estate Planning Essentials
Should You Consider a Spousal Lifetime Access Trust?
Estate planning can be difficult, but it’s a necessary part of any comprehensive financial plan. Depending on the size of your estate and the state in which you live, many of your financial moves may be susceptible to estate taxes. That means that even when you want to leave something behind for your spouse or heirs, Uncle Sam gets a piece of the pie. That’s where trusts can help. Learn the basics of spousal lifetime access trusts (SLATs) and how establishing one may help you reduce your estate tax liability.
Things to Consider When Choosing an Executor Outside of Your Immediate Family
A lot goes into being an estate executor. It’s a responsibility that shouldn’t be taken lightly, and that’s why it’s so important to find the right person for the job when you’re putting together your estate plan. Take these considerations into account when looking for an executor outside your immediate family.
5 Essential Documents for Crafting a Good Estate Plan
No financial plan is truly complete without an estate plan. Everything you own—your house, your car, your possessions and your money—is part of your estate, and you need to plan for what happens to your estate when you pass away. However, it can also be somewhat confusing. To help make sense of it all, here are five key documents you’ll want to have when preparing your estate plan.
Wealth Enhancement Group is a Greater Minneapolis-based independent wealth management firm offering comprehensive and customized financial planning and investment management services. Established in 1997, Wealth Enhancement Group uses a team approach with a focus on simplifying their clients’ financial lives and has offices nationwide.