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Few U.S. high schools have comprehensive personal finance programs, which means that some teens enter adulthood without a deep base of knowledge on topics like investing, budgeting, and consumer debt. Even those who feel they're fairly well-versed in personal finance may find themselves nearing retirement without a solid grasp on certain topics like required minimum distributions or Social Security taxation. But no matter your circumstances, there are some relatively simple steps that may go a long way toward improving your finances.

Know That Little Changes Can Add Up

The thought of saving $1 million for retirement may seem insurmountable, especially if you're just starting out. You don't necessarily need to commit to saving tens of thousands of dollars each year to fund a comfortable retirement. Even setting aside just $100 per month in an investment account may add up over time. Not only does the value of stocks and bonds grow as the years go by, in most cases, but they may also pay dividends, which you may then use to invest in even more shares.

Don't Pay Unnecessary Interest

It may be all but impossible to avoid paying any interest over your life—at least if you spend any time paying a mortgage, auto loan, student loan, or another type of debt. But the interest rate on secured loans (like mortgages and car loans) is sometimes on the lower side, at least when compared to credit cards or paycheck advance loans. It's important to carefully evaluate the interest rate and terms of any loan you take out to ensure you're not overpaying. You may be able to save up cash for a larger down payment to reduce the amount subject to interest. You could also take steps to improve your credit score, so the interest rate you're offered is potentially a lower one. By reducing the amount of interest you pay, you may free up cash for other purchases or to set aside for a rainy day.

It's Important to Think Long-Term

It can often be easier to prioritize short-term comfort or entertainment over long-term security. After all, if you're deciding whether to spend $1,000 on a vacation or set it aside in a retirement account, the mental picture of you having fun on a trip tends to be far more vivid than imagining a comfortable retirement. But just like eating a steady diet of fast food can leave you nutritionally depleted, living a financially undisciplined lifestyle can leave you scrambling for security when you need it the most. Make sure you're paying yourself first—setting aside the funds you need for an emergency or other unexpected expense so that you're not taken by surprise. This can help you avoid incurring consumer debt or taking other actions that may risk your long-term security.

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial professional prior to investing. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and cannot be invested into directly. Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments. The payment of dividends is not guaranteed. Companies may reduce or eliminate the payment of dividends at any given time. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy. LPL Tracking # 1-05186372 Source:  https://money.usnews.com/money/retirement/401ks/articles/can-you-retire-on-1-million-heres-how-far-it-will-go  

As a business owner, you may assume you do not need professional financial advice until you hit certain milestones such as $1 million in sales, having ten employees, or some other tangible measure. However, financial professionals may benefit small-business owners no matter what the stage of their business. The earlier you seek financial advice, the more this advice might help your business as it grows. Here are five ways a financial professional could be your ally as a small-business owner.

Saving You Time and Energy

Having a financial professional to help you plan the economic future of your business might allow you to concentrate on more immediate needs. It may be tough to make long-term projections when just trying to get through each day. Delegating these tasks to a financial professional might help you lower stress. You are able to spend your time managing your operations while your financial professional works on items such as tax-saving strategies, expansion, cash flow projections, and anything else your business may need to manage finances.

Saving You Money

It might be tough to get a comprehensive overview of your business as an owner. Your financial professional might find ways to save you money by taking such a view, tracking your budget expenditures, and seeing where you might be overspending. Cutting out this extra spending might free up capital that you may use to hire more employees, do more marketing, stock more products, or provide your workers with raises.

Evaluating Market Trends

Many small businesses operate in competitive markets, so having a finger on the pulse of relevant trends may be the difference between a booming business and a struggling one. Some financial professionals offer marketing assistance, which may include evaluating market trends. Such an evaluation helps decide how to advertise your business in ways that make sense for your area.

Helping With Investment and Retirement Planning

Every business owner's investment and retirement needs are different. There's no one-size-fits-all solution when it comes to saving for retirement. Your financial professional may run through the available options, such as a simple individual retirement account (Simple IRA), a Simplified Employee Pension (SEP) IRA, a traditional or Roth IRA, or even a business 401 (k) plan. Having savings outside your business should be considered part of any business owner's retirement plan. As your business expands and begins earning more income, your financial professional may help you determine some ways to invest this extra cash flow to keep your business running well.

Helping With Succession Planning

Finally, a financial professional could help you create a succession plan for your business. A succession plan determines what happens to your business when you are not available to run it. Thinking about this plan may not be a pleasant thing to do; however, it might be crucial to maintaining the value of your business. With your financial professional's assistance, you could draft a succession plan that provides clear instructions on keeping your business thriving even in your absence.   Important Disclosures The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual or business owner, nor is it intended to provide a recommendation for any individual security. To determine which investment(s) may be appropriate for you, consult your financial professional prior to investing. This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor. This article was prepared by WriterAccess. LPL Tracking #1-05269108

Five easy pointers to help you plan during all of your retirement years

  If you’re retired, there’s good news in that you’ll probably live longer and perhaps better than your parents and grandparents did. The bad news: You’ll live a longer and perhaps more expensive life, too. You face decisions your parents or grandparents likely didn’t face before you. This means every year you need to realistically estimate your life-expectancy to manage the foundation for your retirement (which might include years of less-than-great-health). Let’s say you are 58 – you need to plan for the next 37 years – more than a third of your life.

Pointers to Help Plan During Retirement

Here are five easy pointers, in ascending order of importance:

5. Costs of advice. You probably have a lot of questions. How much do you pay someone now to help you coordinate your investments? How much do your investments cost?

Is your portfolio sufficiently diversified? Did you buy annuity policies that you don’t really understand and that may become expensive for you to own? Do you need someone to only manage your investments or to also provide financial planning advice? The average American spends more time analyzing the cost of a new TV than the costs and qualities of a financial professional.

4. Social Security. Don’t decide about benefits and lump-sum pension choices without discussing your options with a financial planner – or you may leave significant money behind. Remember too that the Social Security Administration won’t necessarily provide advice on your best strategies.

3. Your home and future health. Consider the final 15-plus years of your life. Where will you live when you’re 80?

In a large home with stairs? Will most of your wealth center around your home as your retirement years tick past? Who will care for you if you can’t yourself (don’t plan on a spouse, as you may become a widow or widower)? Get objective advice on long-term care planning and your options for a reverse mortgage to convert your home equity into cash.

2. Know what you own. Are you one of the tens of thousands with half-forgotten old 401(k) plans from previous employers? Have multiple accounts with various brokers? Outdated estate documents or long-forgotten life insurance policies?

Consolidate your holdings and paper trail, a kindness not only to your current recordkeeping but also to your future heirs.

1. Make your wants clear. Include your adult children or siblings in a frank discussion about where your assets are and your preferences for treatment if you end up in the hospital.

You don’t need to give specific dollar information, but family or friends need to know your preferences and where to find your assets if you die or can no longer communicate. Death and taxes are inevitabilities we all face. Make that time as easy as you can for your executor and heirs.   Important Disclosures The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual product or security. To determine which products(s) or investment(s) may be appropriate for you, consult your financial professional prior to purchasing or investing. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy. This article was prepared by FMeX. LPL Tracking #1-05290107

If you have always thought estate planning was just for those nearing retirement or already retired, think again. If you own a home, it is important to have a plan in place. Without a will or other arrangements that allow your home to pass to your closest loved ones, it is subject to your state's intestacy laws and probate, which may not result in the outcome you want. Here are five different ways your estate plan can pass your home on to your loved ones.

Give Your Home as a Bequest

One of the most common ways to pass a home along to heirs is by specifically naming a beneficiary in your will. When you leave your home in a will, the beneficiary receives a stepped-up cost basis. This provision means that if they later sell the house, they may only pay taxes on the difference in the value when they inherited it and the sale price. Before choosing someone to inherit your home, be sure they are up to the task. For some, the idea of taxes, insurance, and maintenance expenses may feel like anything but a gift. And if the beneficiary is receiving public benefits, like Medicaid, inheriting a home or another item of value may make them ineligible for future benefits until these assets have been sold or spent.

Sell Your Home

If you would rather not leave your home as a bequest to your beneficiaries, another option is to sell it. With the $250,000 capital gains tax exclusion (or up to $500,000 for married couples filing jointly), you may sell your home for a tidy profit, deposit or invest the tax-free gains, and pass these funds along to your heirs.¹

Gift Your Home

Another option is to pass your interest in your home as a gift to your beneficiary. You may do this by adding the beneficiary's name to the deed or executing a legal document. If you want to continue living in the home during your lifetime, you reserve a life estate as a condition of the gift. If the value of your home, and therefore the value of the gifted amount, is more than the gift-tax exclusion, you may owe gift taxes on the excess amount. Your beneficiaries do not benefit from a stepped-up cost basis in your home. Ultimately, leaving your home as a bequest in your will usually makes more sense than giving it directly as a gift.

Put Your Home in a Revocable Trust

A revocable trust is another tool that allows you to pass your home along to a loved one while managing your taxes. A revocable living trust allows you to control the house while you are alive. After you die, the home may then be sold, transferred, or otherwise disposed of according to the trust's terms.

Transfer Your Home on Death

Finally, you may be able to transfer your home upon your death by using a transfer on death (TOD) deed. Upon your death, a TOD deed transfers the title of your home to someone you name in the TOD. It also allows the beneficiary to enjoy the stepped-up cost basis, providing a TOD deed with some advantages over a direct gift. Footnote ¹ Topic No. 701 Sale of Your Home, irs.gov, https://www.irs.gov/taxtopics/tc701   Important Disclosures The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy. This article was prepared by WriterAccess. LPL Tracking #1-05268284

A bear market is a prolonged period of price declines in securities, an index such as the S&P 500, or the overall stock market of usually 20% or more from a recent high. Bear markets can also signal economic downturns such as a pandemic, recession, or geopolitical crisis and may be cyclical or longer-term. Pessimism and overall negative investor sentiment may occur during a bear market, often leading to heard behavior, hasty decisions, and fear selling. These can be a risk to a portfolio's overall long-term performance. As uncomfortable as a bear market may be, understanding how your emotions impact your portfolio's performance is critical. Here are eight tips for helping you survive a bear market:

1. Turn off the noise. Thanks to the media, we live in an interconnected world and always know what is happening in the world's markets. While some information sources provide accurate market information, others may not reflect the current market conditions. Limit your exposure to stock market media reporting and rely on your advisor to inform you of what you need to know. Or, ask questions as to how your portfolio and goals may impact by a bear market.
2. Live your life. It may be unhealthy for you to follow the market's performance 24/7 or let it consume you. Also, it is essential to understand that your portfolio does not define who you are or how successful you are.
3. Understand basis point performance reporting. The relationship between percentage changes and basis points determines a difference in a financial instrument, such as the stock market. The Basis Point (BPS) is used to calculate changes in interest rates, equity indexes (stock market), and fixed-income securities yield.

A basis point is 1/100^th of 1%. For example, the Dow ‘falling’ 400 points would be a 4% decline at the market close. Remember there are 20-22 trading days each month, and reacting to a bear market based on one day's performance may be a premature decision.

4. Understand investment risk. It is essential to investigate the strategies in your portfolio to determine how they pay out dividends and if the payout is reliable during a bear market. Other considerations to consider:

• Keeping cash in a portfolio during a bear market can create other risks such as inflation and time-horizon risks.
• Taking more investment risk during a bear market can reap higher returns when the markets start to recover.

5. Examine your portfolio's strategies. Investing in foreign or emerging markets or different sectors may provide positive returns and recover ahead of domestic markets or other sectors as a bear market shifts toward becoming a bull market.
6. Stick to the (financial) plan. During a bear market, stick to your overall investment objectives and focus on portfolio holdings pertaining to your financial plan, not individual holdings.
7. Let the markets do their thing. It is important to remember that time in the market beats timing the market. Stay focused on your long-term financial strategy and discuss your concerns about bear market volatility with your financial professional.
8. Remember that this bear market, too, will pass. Historically, bear markets tend to be shorter than bull markets. The average length of a bear market is just 289 days or just under ten months. Bull markets can last from a few months to several years, tend to be more frequent than a bear market, and have occurred 78% of the past 91 years.

Are you concerned about this bear market? Today's bear market presents challenges but also opportunities and potential rewards. Our team can help address your concerns about this bear market and develop strategies that align with your goals and timeline. Contact us today!   Sources: https://www.investopedia.com/terms/b/bearmarket.asp https://www.forbes.com/advisor/investing/bear-market-vs-bull-market/#:~:text=Bull%20markets%20can%20last%20for,973%20days%2C%20or%202.7%20years. https://www.kiplinger.com/slideshow/investing/t052-s001-8-facts-you-need-to-know-about-bear-markets/index.html   Important Disclosures The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments. Past performance is no guarantee of future results. Basis Points are a unit relating to interest rates that is equal to 1/100th of a percentage point. It is frequently but not exclusively used to express differences in interest rates of less than 1%. Dividend payments are not guaranteed and may be reduced or eliminated at any time by the company. S&P 500 Index: The Standard & Poor's (S&P) 500 Index tracks the performance of 500 widely held, large-capitalization US stocks. Dow Jones Industrial Average (DJIA): A price-weighted average of 30 blue-chip stocks that are generally the leaders in their industry. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy. This article was prepared by Fresh Finance. LPL Tracking #1-05292862    

You don't need to wait until the end of the year to look for ways to minimize your tax liability. Tax planning should take place throughout the year to have you prepared well ahead of tax season. Here are six ways to minimize your tax liability that you can implement any time before the end of this year:

1. Update your payroll deductions- double check that you are claiming the correct deductions and taking advantage of pre-tax benefits that can help lower your taxable income, such as:

Flexible spending accounts (FSAs)- a health savings account (HSA), healthcare insurance, a flexible spending account (FSA), commuter benefits, and childcare expenses.

2. Maximize pre-tax retirement savings contributions- In 2022, you can contribute $20,500 to your employer's retirement savings plan. If you are aged 50 or older, you can contribute an additional $6,500 to help lower your taxable income.

Other Tax-liability Reduction Strategies Whether you're an individual or a married couple, you can lower your taxable income while doing good for others by donating to an IRS-qualified charity. To take advantage of charitable tax deductions this year, you must make your donation before December 31st. Here are some common charitable donation strategies to consider:

3. Qualified Charitable Distributions (QCDs) - If you're age 72 or older, you can use a QCD to donate to an IRS-qualified charity of your choice directly from your IRA. The gift won't qualify for a charitable deduction but will allow you to deduct the amount transferred to the charity from your taxable income. A QCD may be helpful if you won't reach a level of itemized deductions to exceed the standard deduction amount on your taxes.

  The maximum amount you may donate is $100,000 per year. If you’re married and your spouse also has an IRA, you can donate $100,000 individually, but keep in mind that each spouse must donate the same amount.  

4. Donor-Advised Funds (DAFs) - DAFs enable you to donate assets to a charitable investment account and receive an immediate tax deduction. DAF contributions can be timed to coincide with high-income years to provide a larger tax deduction. DAFs grow tax-free, and you can choose which charities to distribute the gift to each year.

 

5. Non-Cash Charitable Contributions- You can use appreciated stock or assets you’ve held for more than a year as a non-cash charitable contribution by giving them to a charity. A non-cash charitable contribution will help save on capital gains taxes. Make sure you secure a tax deduction to prove the donation when filing your taxes. If you use this strategy, consult your financial and tax professionals to help ensure this executes properly per IRS requirements.
6. Bunch Your Donations-

Bunching or concentrating your donations in one year instead of several years can help you make the most out of potential tax deductions. This strategy helps if your total itemized deductions fall below the standard deduction for a single year. By making charitable contributions for several years at one time, the total of your itemized deductions can exceed the standard deduction and offer tax benefits for one year.     Important Disclosures   The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.   This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.   All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.   This article was prepared by Fresh Finance.   LPL Tracking #1-05283597     Sources: https://www.sdfoundation.org/news-events/sdf-news/what-to-know-about-donor-advised-funds-in-2022-rules-tax-deductions-comparisons-and-more/ https://www.investopedia.com/articles/financial-advisors/032116/how-use-qcd-rule-reduce-your-taxes.asp https://www.forbes.com/advisor/taxes/tax-deductible-donations/  

If you're avoiding looking at your 401(k) balance during periods of market volatility, you're not alone. While the S&P 500 has historically produced an average annual return of 11%, recent market downturns may be impacting your portfolio, especially if you are drawing down assets. If you are a retiree or nearing retirement, managing the sequence of return risk in your portfolio during a declining market is essential since it is a significant risk to your assets lasting through retirement. The sequence of returns impacts investors when they are either adding to or withdrawing money from their investments, which can create risk depending the market conditions at the time. If an investor is not doing either, there is no sequence of returns risk. However, suppose an investor is drawing down their portfolio and not contributing new capital, for example, when they're retired. In that case, there is the risk that the timing of withdrawals will negatively impact the portfolio's overall rate of return.

The sequence of the withdraws is critical to the retirement portfolio lasting the investor’s lifetime:

• Timing is everything- the timing of the withdrawals can damage the overall return and the portfolio that may not be recoverable.
• Withdrawals during a bear market are more damaging than during a bull market.
• If a bear market lasts more than a few months, each withdrawal is not being offset by contributions, leaving the portfolio unable to recover what was withdrawn despite future gains.
• The sequence of return risk can impact market-sensitive investments.
• Diversified portfolios are less likely to be impacted by the sequence of return risk.

When is the optimal time to review your portfolio?

• When the amount of risk you're comfortable with changes. When you retire, you may want as much money as possible in your retirement accounts as you may no longer be earning a steady income. So, approaching retirement may be an excellent time to invest in lower-risk stock options depending on your situation.
• When your asset allocations are off. This may be the time to rebalance your portfolio to the appropriate percentages of stocks, bonds, cash, and other investments appropriate for your situation to monitor your return risk sequence.

Here are a few things to keep in mind before making any changes to your retirement savings portfolio:

• Withdrawing large amounts of money from a declining portfolio could impede your portfolio’s long-term success, especially if those withdrawals happen early in your retirement. Without a regular income, you may not be able to compensate for an unsteady market by adding more to your holdings.
• Evaluate the amount of liquid cash you have on hand. Make sure this amount is high enough for you to feel confident about your portfolio and have enough money to fund your lifestyle and any emergency expenses, regardless of market conditions.
• Instead of making any impulsive decisions to your investment portfolio during down markets, consider adjusting your withdrawal rate, as this can strengthen your portfolios’ long-term longevity.
• Buffer your portfolio by adding an annuity as an asset class and withdrawing more from it during market volatility versus your other retirement assets.

  Remember, paying too close attention to the market and your portfolio can do more harm than good regarding your portfolio’s upward trajectory if you're anxious about market volatility. Retirement provides more time to do precisely this but resist the urge to check your accounts too often. Your financial professional can help if you have any questions regarding the sequence of return risk in your portfolio or adjustments you’d like to make to your retirement portfolio in a down market.   Important Disclosures The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk. Rebalancing a portfolio may cause investors to incur tax liabilities and/or transaction costs and does not assure a profit or protect against a loss. Fixed and Variable annuities are suitable for long-term investing, such as retirement investing.  Gains from tax-deferred investments are taxable as ordinary income upon withdrawal. Guarantees are based on the claims paying ability of the issuing company. Withdrawals made prior to age 59 ½ are subject to a 10% IRS penalty tax and surrender charges may apply.  Variable annuities are subject to market risk and may lose value. S&P 500 Index: The Standard & Poor's (S&P) 500 Index tracks the performance of 500 widely held, large-capitalization US stocks. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy. This article was prepared by Fresh Finance. LPL Tracking # 1-05265292   Sources: https://www.cnbc.com/2022/03/01/if-youre-nearing-retirement-be-sure-youre-managing-this-big-risk.html https://www.forbes.com/advisor/retirement/sequence-of-returns-risk/ https://www.investopedia.com/terms/s/sequence-risk.asp

Markets rarely give us clear skies, and there are always threats to watch for on the horizon, but the right preparation, context, and support can help us navigate anything that may lie ahead. So far, this year hasn’t seen a full-blown crisis like 2008–2009 or 2020, but the ride has been very bumpy. We may not be flying into a storm, but there’s been plenty of turbulence the first part of 2022. How businesses, households, and central banks steer through the rough air will set the tone for markets over the second half of 2022. Turbulence cannot be avoided, but it also need not deter us from making progress toward our financial goals. LPL Research’s Midyear Outlook 2022: Navigating Turbulence is designed to help you assess conditions over the second half of the year, alert you to the challenges that may still lie ahead, and help you find the smoothest path for making continued progress toward your destination. When times are turbulent, the surest path toward progress remains sound financial advice from dedicated professionals who have logged many hours in similar conditions.  

View the digital version: https://view.ceros.com/lpl/midyearoutlook2022

      This material is for general information only and is not intended to provide specific advice or recommendations for any individual. The economic forecasts may not develop as predicted. Please read the full Midyear Outlook 2022: Navigating Turbulence publication for additional description and disclosure. This research material has been prepared by LPL Financial LLC. Tracking # 1-05292601 (Exp. 07/23)

Almost half of all adults are part of the "sandwich generation." These are adults in their 40s and 50s who are helping support or care for a parent while also supporting or caring for a child.¹ Being caught between two generations of loved ones who require care can be both financially and emotionally draining, but there are ways to reduce the pressure. Here are three financial planning challenges the sandwich generation is likely to face—and some strategies to address them.

Challenge: Having to provide daily care for a parent while working full-time.

Strategy: Research care options and alternatives.

There is often a lot of gray area between needing some help with daily activities and requiring round-the-clock care. If you find yourself visiting your parent one or more times each day to provide assistance, it is worth looking into home care options that can relieve some of this burden. From aides to home health nurses to companions, there are many providers who may be able to share some of the responsibilities you are shouldering. What's more, these services are often available at low or no cost if your parent has Medicare, Medicaid, or VA insurance.

Challenge: Saving for retirement while having to step back from work to care for a parent.

Strategy: Meet with a financial professional.

Many members of the sandwich generation find themselves dropping out of the workforce so that they no longer have to schedule their caregiving duties around a full-time job. Unfortunately, this can sometimes come at the expense of their own retirement funds. By meeting with a financial professional, they can work with you to help develop financial goals, make any investment changes you need to, and begin to plan your retirement budget.

Challenge: Having adult children "boomerang" back into the nest.

Strategy: Maintain clear communication and expectations.

More young adults than ever are living with their parents. And while some parents are happy to have their children back in the nest (if they ever left), others are ready to be on their own. Having multiple adults sharing the same household can often lead to tension, especially if the adult children are not financially contributing to bills or doing their part to clean and care for the house. The easiest way to avoid resentment is to make expectations clear at the outset and maintain clear lines of communication. Some parents may expect their children to pay rent or make some other financial contributions to the household; others may urge their children to save as much money as possible so that they can move out. Whatever the goals and expectations are, ensuring that everyone is on the same page when it comes to your financial support can go a long way toward avoiding conflict. Though it can be stressful to be part of the sandwich generation, there are ways to manage this stress and maintain strong relationships with your parents and your children. With some careful planning, you should be able to manage the needs of all three generations.   Important Disclosures The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy. This article was prepared by WriterAccess. LPL Tracking #1-05283802   ¹  Family Caregiving Challenges for the Sandwich Generation, The Arbors, https://blog.arborsassistedliving.com/family-caregiving-challenges-for-the-sandwich-generation  

A Roth IRA conversion involves repositioning traditional IRA or qualified employer-sponsored retirement plan assets into a Roth IRA. One reason people convert traditional IRAs or other retirement accounts into Roth IRAs is so they can enjoy tax-free income in retirement. Another reason is the Roth IRA's flexibility not to make withdrawals if the money isn't needed since there is no Required Minimum Distribution (RMD). Or, they may use a Roth IRA conversion as part of estate planning to lessen the impact of estate taxes on their estate. Whatever the reason for the Roth IRA conversion, investors often consider this a suitable time to do a Roth IRA conversion whenever the stock market is down. However, there are many questions to answer before putting this strategy into action: Does your qualified retirement plan allow Roth IRA conversions? If you have your monies inside your employer's retirement savings plan, check the plan's documents to see if a Roth IRA conversion is allowed. If not allowed and you initiate the conversion, the conversion may not occur, or a penalty will be applied when the conversion happens. Consult your employee handbook, contact your HR, or contact your employer-sponsored retirement plan's custodian for answers about your situation. Can you pay the taxes? Since traditional IRAs and other qualified retirement plans are tax-deferred plans, upon converting assets into a Roth IRA, the account owner must pay income tax on the amount they convert. Also, the taxes are due upfront when the conversion occurs. Are you comfortable with your Adjusted Gross Income (AGI) increasing? A Roth IRA conversion will increase your income in the year that the conversion occurs. If you are retired, be mindful that Medicare Part B uses your two previous years' income to calculate your monthly premium, and the conversion may increase your Part B payment for at least two years. Increasing your AGI also may impact your income tax as you may move into another income tax bracket. Meet with your financial and tax professionals to determine how a Roth IRA conversion may affect you. Will you lose eligibility for specific tax write-offs? The child tax credit and student loan interest deduction are determined by personal income, and initiating a Roth IRA conversion may mean you lose these deductions if your AGI increases. Will you need the money within five years? Roth IRAs typically offer penalty and tax-free withdraws anytime on contributions. Still, when using conversion monies, investors must wait five years to withdraw the funds without a 10% penalty regardless of their age. If you anticipate needing money from your Roth IRA before the five-year rule sunsets, this may not be an appropriate strategy for you. Talk to a financial professional. Your financial professional can help you determine if a Roth IRA conversion is appropriate for your situation by helping you weigh the pros and cons. Contact them today!   Important Disclosures The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial professional prior to investing. Traditional IRA account owners should consider the tax ramifications, age and income restrictions in regards to executing a conversion from a Traditional IRA to a Roth IRA. The converted amount is generally subject to income taxation. This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy. This article was prepared by Fresh Finance. LPL Tracking # 1-05265292   Sources: https://www.cnbc.com/2022/02/28/should-you-consider-a-roth-ira-conversion-when-the-market-drops-.html https://www.investopedia.com/terms/i/iraconversion.asp https://www.irs.gov/retirement-plans/retirement-plans-faqs-regarding-iras https://www.cnbc.com/2022/03/08/considering-a-roth-ira-conversion-heres-how-to-reduce-the-tax-bite.html