Meaglia Financial Consulting

06/18/2024

ROTH IRA: A GOOD FIT FOR YOUR GOALS?
Traditional and Roth individual retirement accounts are both good choices for retirement investing. A Roth IRA offers tax advantages when you’re ready to withdraw your money, while traditional IRA contributions are tax-deferred until you make withdrawals. Reviewing both IRA options can help you decide.

Roth Basics
Contributions to a Roth IRA are made with after-tax money. That means you won’t get a tax deduction for your contributions. However, the money in your account accumulates tax free. Withdrawals are also tax free, giving you a tax-free income stream in retirement. The maximum contribution to Roth and traditional IRAs in 2024 is $7,000, or $8,000 for people age 50 or older.

No Required Distributions
Traditional IRAs require minimum distributions from your account after you reach age 73. A Roth IRA has no minimum distribution requirement — ever. If you don’t need the money in your account, you can allow it to keep growing tax free during your lifetime and then pass the Roth IRA tax free to your heirs.

Income Limits
You cannot contribute to a Roth IRA if your modified adjusted gross income (MAGI) exceeds certain amounts. For 2024, the income limit for single and head-of-household filers to contribute the maximum amount is $146,000. Partial contributions are allowed until MAGI exceeds $161,000. Married joint filers can contribute the full amount if MAGI is $230,000 or below, with total phaseout at MAGI above $240,000.

The Five-year Rule
Contributions to a Roth IRA can be withdrawn at any time, but earnings distributed before age 59 1/2 may be subject to a 10% penalty and income tax unless you meet an exception. After age 59 1/2, you can withdraw both contributions and earnings with no penalty once the account has been open for at least five tax years.

How to Decide
Consider a Roth IRA if you expect to be in a higher tax bracket in retirement. Because you’ll pay taxes on the conversion, converting a traditional IRA to a Roth IRA generally should be undertaken when you have a dip in income. Your financial professional can help you make an informed decision.

Traditional and Roth individual retirement accounts are both good choices for retirement investing. A Roth IRA offers tax advantages when you’re ready to withdraw your money, while traditional IRA contributions are tax-deferred until you make withdrawals. Reviewing both IRA options can help you de...

06/04/2024

BUILDING WEALTH FOR RETIREMENT
Saving for retirement in an employer’s 401(k) plan or an individual retirement account (IRA) is only one part of a wealth accumulation strategy. A comprehensive wealth strategy involves a personalized, in-depth review of what your financial future may look like. Having a wealth strategy can help you set a course for financial stability in retirement.

Your Financial Situation
The wealth accumulation strategy you employ will depend in part on an assessment of your current finances, including the assets you already have. A review can help determine if you’re saving and investing enough each year based on your goals and allow you to address any potential gaps.

Your Goals
The amount of money you’ll need in retirement will depend on your expenses and your desired lifestyle. Think about where your income will come from and the amount you can expect from each source. Then estimate your expenses, including living costs, health care, taxes, travel, hobbies, and legacy plans. Knowing how much money you’ll need for each expense will give you a better understanding of what you’ll have to earn from your investments. Use it as a guide in determining your asset allocation* and the amount of risk you can take with your investments.

Strategies for Growth
The wealth strategies you implement should be specific to your goals and include both growth and protection strategies. Start with a diversified* portfolio that consists of a wide variety of asset classes, such as stocks, ETFs, mutual funds and fixed-income investments. Also, consider an annuity to help create a lifetime income stream for you or for you and your spouse.** Consider adding life insurance to replace a spouse’s income if he or she dies; a long-term care policy to protect you from rising care costs; and a health savings account, if available to you.

Your financial professional can help you create and implement a wealth accumulation strategy to prepare for retirement.

*Diversification and asset allocation cannot eliminate the risk of investment losses. Past performance won’t guarantee future results. An investment in stocks or mutual funds can result in a loss of principal. Asset allocation may help reduce volatility in your portfolio.

**Distributions from annuities are taxed as ordinary income and, if taken prior to reaching age 59 1/2, may be subject to an additional 10% IRS tax penalty.

Saving for retirement in an employer’s 401(k) plan or an individual retirement account (IRA) is only one part of a wealth accumulation strategy. A comprehensive wealth strategy involves a personalized, in-depth review of what your financial future may look like. Having a wealth strategy can help y...

05/28/2024

INVESTING IN CHANGING MARKETS
It seems like any piece of news can either rattle or encourage stock markets, propelling stock prices to decrease or increase rapidly and giving some investors heartburn as they worry and watch. If you are a long-term investor, you typically don’t need to fret about short-term volatility. But if you can’t help worrying or you have a shorter investment timeframe, consider the following tips to help ease your concerns.

Time is on Your Side
If you are years away from your financial goals, time is plentiful. If you are one of those investors who can’t stop worrying over market performance, take comfort in knowing market volatility is quite common. You may find that most downturns are usually short relative to your investing timeframe and you have the ability to ride out short-term declines.

Regardless of timeframe, never invest in a way that makes you feel uncomfortable. While markets ebb and flow, individual securities and those of smaller industries can decline and never return to their former glory, leaving investors with permanent losses. Work with your financial professional to help ensure you have a mix of investments that helps compensate for the poor performance of a few.

Time is Short
Stories abound of investors nearing retirement who had invested too aggressively and needed to continue working to make up for their losses. If you expect to begin taking distributions from your investment accounts soon, you may want to have a more conservative portfolio mix that provides both the security and hedge against inflation you may need.

A more conservative approach may potentially limit losses, as can spreading your risk by diversifying* among and within asset classes. Diversify by asset class by spreading your investment dollars among stock, fixed income and money market asset classes. Diversify within an asset class, for example, by choosing large-cap and small-cap stocks and domestic and international equities.

Your financial professional can help you choose an appropriate investment mix for your risk tolerance and time frame.

*Diversification cannot eliminate the risk of investment losses. Past performance won’t guarantee future results. An investment in stocks or mutual funds can result in a loss of principal.

It seems like any piece of news can either rattle or encourage stock markets, propelling stock prices to decrease or increase rapidly and giving some investors heartburn as they worry and watch. If you are a long-term investor, you typically don’t need to fret about short-term volatility. But if y...

05/14/2024

TIME FOR A MID-YEAR PORTFOLIO CHECK

Review Your Strategy
The reason for having an investment strategy is to move you closer to the goals you’ve set for yourself. Based on your life stage, consider whether your current portfolio balance combined with your savings rate puts you on track to reach your goals.

Check Your Asset Allocation
Comparing your portfolio’s actual asset allocation to the target allocation you chose when you selected your investment mix can help you determine if you’re taking more or less risk than you intended. If your investment weightings across equities, fixed income and cash are no longer in line with your long-term goals, you may want to rebalance your portfolio. You can rebalance by selling investments in the category that is outperforming or by funneling future contributions into the investment class that falls below your target allocation.*

Assess Your Risk Tolerance
The amount of investment risk you are willing to take is a personal decision. Conservative investors tend to be cautious about taking too much risk, while moderate and aggressive investors are willing to take more risk in the hope of earning higher returns. No matter which type of investor you are, make sure you are taking the appropriate amount of risk for your age and goals. Investors with a longer time frame before they’ll need their savings typically can afford to invest more heavily in equities, while investors who are closer to retirement may want to shift a larger portion of their investments into fixed income investments.

Priorities Can Shift
Life events can affect your goals and investment strategy. Marriage, divorce, job loss or a new baby may alter your goals. You may need to make changes to your strategy that reflect your new circumstances.

Your financial professional can help you with your mid-year check-up.

*Asset allocation won’t guarantee a profit or ensure against a loss but may help reduce volatility in your portfolio.

Investment values aren’t static. They rise and fall throughout the year based on market performance. As 2024 approaches the halfway point, it is a smart move to review your portfolio to determine the impact of market fluctuations and make any needed changes to stay on track with your investment st...

05/07/2024

Let's Talk Money! May/June Edition:
https://www.ltmonline.com//meagliafinancialnews/2024MayJun

TIME FOR A MID-YEAR PORTFOLIO CHECK
Investment values aren’t static. They rise and fall throughout the year based on market performance. As 2024 approaches the halfway point, it is a smart move to review your portfolio to determine the impact of market fluctuations and make any needed changes to stay on track with your investment strategy...

INVESTING IN CHANGING MARKETS
It seems like any piece of news can either rattle or encourage stock markets, propelling stock prices to decrease or increase rapidly and giving some investors heartburn as they worry and watch. If you are a long-term investor, you typically don’t need to fret about short-term volatility. But if you can’t help worrying or you have a shorter investment timeframe, consider the following tips to help ease your concerns…

ROTH IRA: A GOOD FIT FOR YOUR GOALS?
Traditional and Roth individual retirement accounts are both good choices for retirement investing. A Roth IRA offers tax advantages when you’re ready to withdraw your money, while traditional IRA contributions are tax-deferred until you make withdrawals. Reviewing both IRA options can help you decide…

BUILDING WEALTH FOR RETIREMENT
Saving for retirement in an employer’s 401(k) plan or an individual retirement account (IRA) is only one part of a wealth accumulation strategy. A comprehensive wealth strategy involves a personalized, in-depth review of what your financial future may look like. Having a wealth strategy can help you set a course for financial stability in retirement…

All this and more in this issue of Let's Talk Money:
https://www.ltmonline.com//meagliafinancialnews/2024MayJun

04/23/2024

YOU CAN ORGANIZE YOUR FINANCIAL LIFE

Piles of receipts on the dining room table. Bank statements on the desk in the spare room. You didn’t plan on your financial and personal records ending up in a free-for-all, but that’s what’s happened. How you wish someone would organize your stuff!

Good news! There is someone who can get your financial records in order. And that someone is you! Because you might need some help in the organizing department, here are some tips for simplifying your financial life.

Decide on a system.
You can organize your information by topic or by year, whichever method is easier for you. Use colored folders to hold similar information, including tax documents, investment reports, bank statements, etc. Label everything so you can find it easily. Keep all your records in one place, such as a fireproof safe or a filing cabinet.

Create a back-up system.
Scan critical financial documents before filing them. Keep them in a password-protected computer file or on a removable drive or store them in the cloud. Shred any documents with sensitive information that you no longer need.

Put your financial life online.
Paperless billing and electronic delivery of bank and investment statements reduce clutter and prevents you from misplacing important bills and documents. Establish online bank, credit card, phone, cable and utility accounts to make payments. Setting up automatic bill pay can further simplify your finances. Make sure you have sufficient money in your bank account when payments are deducted.

Consider a safe deposit box.
You can store many critical documents that you don’t often need and keep them safe from fire and theft. Keep copies of stored documents in case you need to refer to them quickly.

Share your information.
Tell someone you trust where your information is located and how to access it. Share a list of your accounts with password information so that a person can retrieve them in an emergency.

Let's Talk Money

Piles of receipts on the dining room table. Bank statements on the desk in the spare room. You didn’t plan on your financial and personal records ending up in a free-for-all, but that’s what’s happened. How you wish someone would organize your stuff!

04/09/2024

THE BENEFITS OF FINANCIAL AND TAX STRATEGIES

A well-coordinated financial strategy encompasses more than just your investments. It considers every aspect of your finances, from budgeting to retirement saving, to ensure you’re making decisions that can help you reach all your goals.

The Big Picture
A successful strategy should provide a complete view of all your finances. By knowing how much savings you have accrued and the debts you owe, you can come up with a roadmap for spending, saving and investing. Identifying your short- and long-term goals is a good place to start. Paying off debt might be a short-term goal, while saving for retirement generally is a long-term goal that could be years in the future. Setting aside money for a child’s education might be a mid-term goal.

Work Toward Your Goals
A cornerstone of your strategy should be the probability of reaching all the milestones you’ve identified. You and your financial professional choose a target asset allocation based on your goals, time frame and risk tolerance. Whether you’re an aggressive or a conservative investor, it’s essential to periodically check your progress toward your goals and adjust your strategy as needed.

Your Retirement Picture
What you want to do in retirement can be a factor in how much savings you’ll need to accumulate. If you plan to travel, relocate or even start your own business, you’ll need to have sufficient funds for those endeavors. Your financial professional can help you estimate your future financial needs and build the wealth you’ll need to meet them.

Market Ups and Downs
Periods of market volatility and high inflation can affect your investments’ performance over the short term. Investors may panic and sell investments when values are down. Historically, markets have always recovered their losses. Your financial professional can help you make investment decisions that aren’t driven by short-term market fluctuations.

Help with Taxes
Taxes can impact your finances both before and during retirement. A tax professional can help you create a tax-efficient estate plan, advise you on charitable donations and explain any tax breaks and deductions that are available to you.

Let's Talk Money
https://www.ltmonline.com/meagliafinancialnews/2024MarApr/The_Benefits_of_Financial_and_Tax_Strategies

03/26/2024

LIFE INSURANCE: AN IMPORTANT PART OF A FINANCIAL STRATEGY

Life insurance has many uses. If a breadwinner dies, proceeds from a life insurance policy can fund a child’s college education, pay for child care or other services, and ensure that surviving members will maintain their current standard of living. It can also be part of a charitable giving strategy.

Consider the type of life insurance that would work well with your overall financial strategy.

Term Life
Term life provides death benefit coverage for a fixed period. Term life has no cash value, so when the term is over, the policy ends.

Whole/Permanent Life
A permanent life policy accumulates cash value at an interest rate that’s set when you purchase the policy. You pay a fixed premium based on the rate. You can borrow against the policy, but unpaid loans will reduce the death benefit.

Universal Life
Universal life is a form of permanent coverage. It offers flexibility with benefits and premiums. The cash value of the policy can be borrowed against or withdrawn.

Variable Life
The cash value of the policy can be invested to take advantage of rising equity markets in the hope of producing potentially greater returns. However, losses are also possible.

Charitable Giving and Taxes
Life insurance can be used to benefit a charity. You can donate a life insurance policy directly to a charity, name a charity as beneficiary of the policy, or set up a rider to pay a charity a percentage of the policy’s value. Proceeds can also provide liquidity to pay estate taxes on large estates. Consult your insurance professional about the many benefits of life insurance.

*Applications for life insurance are subject to underwriting. No insurance coverage exists unless the required premium is paid. Accessing cash values may reduce the death benefit and policy values, trigger tax consequences, surrender fees, and charges, and may require additional premium payments to maintain coverage. Guarantees are based on the claims-paying ability of the issuer.

Let's Talk Money

Life insurance has many uses. If a breadwinner dies, proceeds from a life insurance policy can fund a child’s college education, pay for child care or other services, and ensure that surviving members will maintain their current standard of living. It can also be part of a charitable giving strate...

03/12/2024

SAVE FOR RETIREMENT AND LOWER YOUR TAX BILL?

You can do both! By contributing to a traditional individual retirement account (IRA) by the April 2024 tax filing deadline, you may be able to deduct some or all of your contributions on your 2023 income tax return.

Above-the-Line Deduction
Above-the-line deductions help reduce the amount of your income that is subject to federal income tax. Contributions to a traditional IRA are deducted directly from your gross income, which is used to calculate your adjusted gross income (AGI), which is the amount of income you report on your return.

Who Is Eligible?
Your ability to deduct contributions to a traditional IRA is affected by how much you earn and whether you or your spouse has a retirement plan at work. For 2023, deduction limits for individuals who are covered by a workplace retirement plan are:
Single/Head of Household filers with Modified AGI (MAGI) of $73,000 or less, full deduction; $73,000 - $83,000, partial deduction; over $83,000, no deduction.

Married filers with MAGI of $116,000 or less, full deduction; $116,000 - $136,000, partial deduction; over $136,000, no deduction.

Married separate filers with MAGI less than $10,000, partial deduction; over $10,000, no deduction.

Single/Head of Household and Married Joint filers not covered by a workplace plan can take the full deduction.

What if Your Spouse is Covered?
Married joint filers with MAGI up to $218,000 can claim the full deduction when a workplace plan covers one spouse. A partial deduction is available with MAGI between $218,000 - $228,000. Once MAGI exceeds $228,000, no deduction is allowed. Married filing separately whose MAGI is $10,000 or less get a partial deduction.

Contribution Limits
You can contribute up to $6,500, or your taxable compensation, if less, to a traditional IRA for 2023. Individuals age 50 and older can make an additional catch-up contribution of $1,000, for a total of $7,500.

Reap the Benefits
Over time, even small contributions to an IRA can grow and compound, so don’t miss out on this opportunity. Your financial professional can provide guidance on contributing to an IRA.

*MAGI is your AGI plus a few items — like exempt or excluded income and certain deductions. The IRS uses MAGI to determine your eligibility for certain deductions, credits and retirement plans.

Let's Talk Money

You can do both! By contributing to a traditional individual retirement account (IRA) by the April 2024 tax filing deadline, you may be able to deduct some or all of your contributions on your 2023 income tax return.

03/05/2024

Let's Talk Money! March/April Edition:
https://www.ltmonline.com/meagliafinancialnews/2024MarApr

SAVE FOR RETIREMENT AND LOWER YOUR TAX BILL?
You can do both! By contributing to a traditional individual retirement account (IRA) by the April 2024 tax filing deadline, you may be able to deduct some or all of your contributions on your 2023 income tax return...

LIFE INSURANCE: AN IMPORTANT PART OF A FINANCIAL STRATEGY
Life insurance has many uses. If a breadwinner dies, proceeds from a life insurance policy can fund a child’s college education, pay for child care or other services, and ensure that surviving members will maintain their current standard of living. It can also be part of a charitable giving strategy. Consider the type of life insurance that would work well with your overall financial strategy...

YOU CAN ORGANIZE YOUR FINANCIAL LIFE
Piles of receipts on the dining room table. Bank statements on the desk in the spare room. You didn’t plan on your financial and personal records ending up in a free-for-all, but that’s what’s happened. How you wish someone would organize your stuff! Good news! There is someone who can get your financial records in order. And that someone is you! Because you might need some help in the organizing department, here are some tips for simplifying your financial life...

THE BENEFITS OF FINANCIAL AND TAX STRATEGIES
A well-coordinated financial strategy encompasses more than just your investments. It considers every aspect of your finances, from budgeting to retirement saving, to ensure you’re making decisions that can help you reach all your goals...

All this and more in this issue of Let's Talk Money:
https://www.ltmonline.com/meagliafinancialnews/2024MarApr

02/27/2024

HOW LIFE INSURANCE WORKS

Term or Perm?
There are two basic types of life insurance. Term life provides coverage for a fixed period or up to a specific age. If you die during the policy’s term, your beneficiaries receive a death benefit payout. A term policy has no cash value, and the death benefit doesn’t change over time. Term insurance is generally the least expensive option. Permanent life doesn’t expire if you continue to pay the premiums. The policy builds cash value, typically from investments.

Your Options
You can choose the amount of the death benefit; the larger the benefit, the higher the premiums.

You can also name one or more beneficiaries to receive the policy’s proceeds when you die. The beneficiary can be a person or an organization, such as a charity.

Payouts and Riders
Some permanent policies offer another type of payout known as a living benefit, which is money the policyholder collects from the policy while living. You may be able to withdraw or borrow money or pay the premiums from the policy’s cash value. You can also add a rider to some policies that allow you to access part of the death benefit to help pay bills if you’re terminally ill. However, any payout you receive can reduce the death benefit for your beneficiaries.

Collecting Benefits
Your beneficiary should contact the insurance company and submit a claims form with the policy number, Social Security number, and a copy of the death certificate to receive the payout. Payout options include a lump sum, installments over time, or a delayed payment while making a payout decision.

*Applications for life insurance are subject to underwriting. Insurance coverage exists only if a policy is issued and the required premium to put it in force is paid. Accessing cash values may result in surrender fees and charges and, may require additional premium payments to maintain coverage, and will reduce the death benefit and policy values. Guarantees are based on the claims-paying ability of the issuer.

Let's Talk Money:
https://www.ltmonline.com//meagliafinancialnews/2024JanFeb/How_Life_Insurance_Works
https://www.ltmonline.com//meagliafinancialnews/2024JanFeb/How_Life_Insurance_Works

How much do you know about life insurance?* Understanding how your policy works and the steps your beneficiaries will need to take to claim the policy proceeds should be a priority. Your insurance professional can help you select the coverage that best meets your needs.

02/13/2024

TAX-FAVORED SAVINGS FOR DISABLED INDIVIDUALS

chieving a Better Life (ABLE) accounts are tax-advantaged savings accounts for individuals with disabilities and their families. Funds in the account can be used to pay for various qualified expenses without losing eligibility for government benefits, such as Supplemental Security Income (SSI). Be sure you work with your legal and tax professionals to avoid any missteps.

Who Is Eligible?
To be eligible for an ABLE account, individuals must have been diagnosed with a significant disability before age 26 (This limit will raise to age 46 in 2026). The beneficiary, the beneficiary’s family, and friends can contribute to the account. Contribution limits are tied to the annual gift tax exemption amount (currently $17,000). Disabled individuals who earn income can contribute that income to their ABLE accounts above the gift tax exemption limit.

What Are Qualified Expenses?
Funds in an ABLE account are invested and potentially grow tax-free. Money can be used to pay for expenses such as basic living costs, education, housing, transportation, employment training, health care, assistive technology/services, financial management and administrative services, and legal fees.

Let's Talk Money:
https://www.ltmonline.com//meagliafinancialnews/2024JanFeb/Tax-favored_Savings_for_Disabled_Individuals
https://www.ltmonline.com//meagliafinancialnews/2024JanFeb/Tax-favored_Savings_for_Disabled_Individuals

Achieving a Better Life (ABLE) accounts are tax-advantaged savings accounts for individuals with disabilities and their families. Funds in the account can be used to pay for various qualified expenses without losing eligibility for government benefits, such as Supplemental Security Income (SSI). Be....