Tax Loss Harvesting | Turning Portfolio Pain into Planning Alpha – Pt. 2
Tax-loss harvesting (TLH) can be a useful tool for minimizing the effects of taxes, helping your clients make the most of their financial plans and portfolios. However, a delicate balance and careful planning is required to reap the benefits of tax-loss harvesting without causing unintended consequences. There are drawbacks that should be considered before executing TLH strategies or adding TLH to an account.
Tax Loss Harvesting | Turning Portfolio Pain into Planning Alpha – Pt. 1
Many investors may find themselves sitting on unrealized losses in positions that have lagged or corrected. This presents an opportunity not only to offset the current year’s capital gains, but also to rebalance portfolios to better align with client goals. Tax-loss harvesting isn’t just a way to benefit from down markets; it’s a proactive strategy that can generate measurable tax alpha* when implemented to a client’s strategy.
Standard of Living & Living Expenses
When using cash flow-based planning software, it is generally best practice to itemize liability payments, property taxes, life insurance premiums, and certain other expenses such as medical, new vehicle, and lump sum purchase expenses. These, plus the client’s Living Expenses, equal what may be referred to as the Total Expenses.
2026 Tax Related Deadlines
Tax season is here! Inside are some helpful dates to keep in mind for the 2026 tax season.
Preparing for the Unexpected: Disability
A wealth builder’s ability to earn income is typically their most valuable asset. Losing an income could very well total a loss of millions of dollars over a client’s lifetime. For example, assuming a 2.5% annual increase in income, a 43-year-old earning $150,000/year and planning to work until age 65 would lose $4,329,424 in lifetime income if they became permanently disabled today.1 This would likely be devastating to their short- and long- term financial stability, as even a substantial emergency fund and/or investment portfolio can be depleted quickly, and at the jeopardization of other goals.
Transtheoretical Model of Behavior Change
As we all know, most people are naturally resistant to change. You can gain insight on potential reasons why clients may be resistant to suggestions, advice, or tasks you ask them to complete by understanding The Transtheoretical Model of Behavior Change (TTM), developed by researchers James Prochaska and Carlo DiClemente in 1983. This model can apply to both prospecting – and motivating clients to follow your advice.
Goal Setting – A Win-Win for Advisors and Clients
According to Savology, people actively working toward clear goals are 10 times more likely to succeed. Your discovery meetings and review meetings can be a great time to talk with clients (both existing and prospective) about their financial goals, both for the current year and beyond. Any new goals can be added to the client’s financial plan, and existing goals can be reviewed and updated. Below are broad examples of some short-, medium- and long-term goals.
Life Cycle Financial Planning
Life cycle financial planning refers to the process of identifying and managing the financial needs and challenges that arise at different stages of life. As clients go through the various stages and life changes, their responsibilities, needs, and financial capabilities are likely to shift, so it is important to understand the needs of each phase to best serve clients. Below is a list of the 5 stages of the financial planning lifecycle, with examples of key financial planning needs at each stage.
Understanding Marketplace Health Insurance
How can clients obtain health insurance if they plan to retire prior to the Medicare eligible age of 65 or lack job-based coverage? The federal Health Insurance Marketplace (www.healthcare.gov), also called the “Exchange,” is the website where individuals can browse, compare, and purchase health care plans available under the Affordable Care Act. Many states, including Pennsylvania, Maryland, New Jersey, and New York, have their own marketplace website.
The Seven MAGI Calculations
Modified Adjusted Gross Income (MAGI) is a key calculation used by tax professionals and government agencies to determine an individual’s eligibility for various tax credits, deductions, and other considerations. It is based on an individual’s Adjusted Gross Income (AGI) with addbacks specified in the Internal Revenue Code. The concept of MAGI may seem straightforward; however, did you know that the IRS has seven separate definitions?
