Topic: Financial Planning
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Conversations with Confluence: The Process Behind Strategic Wealth Management
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6 Ways High Earning Women Can Navigate Career, Wealth, and Life Changes
As a woman, a financial advisor, a mother of four, a wife, and a daughter who has cared for aging parents, I’ve lived many of the transitions and challenges that high-earning women face. I’ve also changed careers, taken time off to raise my children, and returned to the workforce with a renewed sense of purpose. These experiences have shaped not only how I view financial planning, but how I help other women approach their wealth with confidence and clarity.
Financial planning is deeply personal, and for women, especially those with high earning potential, it often requires a tailored approach that reflects the realities of our lives. From career shifts to caregiving roles, longevity, and legacy goals, thoughtful planning can help us protect, grow, and purposefully use our wealth.
1. Career Trajectories and Earning Patterns
Women’s careers often don’t follow a straight line. Whether it’s stepping away to raise children, caring for loved ones, or pivoting into new roles, these transitions can impact income, retirement savings, and investment strategies. I’ve seen how flexible financial planning that accounts for pauses and pivots can empower women to stay on track and build long-term wealth, even when life takes unexpected turns.
2. Longevity and Healthcare Considerations
Women tend to live longer than men, which means our retirement plans need to stretch further. We must think about healthcare, long-term care, and how to sustain our lifestyle for decades. Planning for longevity isn’t just about numbers, it’s about peace of mind. It’s about knowing that we’ll be okay, and that we won’t be a financial burden to those we love.
3. Risk Tolerance and Investment Approach
I’ve worked with women who are cautious investors and others who are bold and growth oriented. There’s no one-size-fits-all approach. What matters is aligning your investments with your values, goals, and comfort level. Your portfolio should reflect this, balancing growth, protection, and flexibility, so you can feel confident in every market cycle.
4. Estate, Legacy, and Intergenerational Wealth
Many women I work with are the financial stewards of their families. They care deeply about how their wealth will impact future generations and the causes they believe in. Whether it’s through charitable giving, trusts, or legacy planning, a thoughtful financial plan can assist in fulfilling family objectives and legacy goals.
5. Empowerment Through Education and Engagement
Historically, women have faced barriers to financial confidence and literacy. Too often, women feel intimidated by financial jargon or worry they’re “not good with money.” But I believe, and have witnessed, that with the right guidance, women become incredibly powerful financial decision-makers. Women should feel safe asking questions, exploring options, and taking control of their financial futures.
6. Life Transitions and Flexibility
Life is full of transitions including marriage, divorce, career changes, caregiving, and retirement. I’ve walked through several of these stages myself. That’s why I believe financial plans need to be adaptable and should evolve as life does. Because when your financial strategy is flexible, you’re better prepared for whatever comes next.
Financial planning for women isn’t just about numbers, it’s about life. It’s about creating a strategy that supports your goals, your family, and your future. As someone who’s lived many of these experiences, I’m passionate about helping women feel confident, informed, and empowered in their financial journey.
Let’s talk about how thoughtful planning can help you balance wealth, life, and legacy. I’d love to help you explore your options and build a plan that reflects your unique path.
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Beyond the Balance Sheet: Purpose-Driven Financial Planning
Financial planning should be more than a checklist. It should reflect your values, align with your purpose, and bring clarity to every aspect of your financial life. In this conversation, we’ll explore how a truly comprehensive planning process connects all the pieces of your financial picture into one cohesive plan.
Featuring:
Greg Weimer, CEO of Confluence Financial Partners
Chuck Zuzak, CFA®, CFP®, Director of Wealth Planning
In this session, we’ll discuss:
What “comprehensive” really means; integrating taxes, insurance, estate planning, and more
One Big Beautiful Bill: key provisions that could affect your financial plan now, and in the future
Designing a financial plan that reflects your beliefs and helps define what money means to you
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Inheriting Wealth: What You Might Overlook
Inheriting a large sum of money can be life-changing, but it can also come with increased responsibilities and potential pitfalls. Without careful planning, an inheritance could quickly become a source of stress, conflict, or even potentially lead to financial loss. Many individuals overlook critical considerations that could have long-term consequences.
Here are some of the most overlooked considerations:
1. Understanding How the Inheritance Is Structured
An inheritance may come through a will or a trust, and the structure dramatically affects how and when you receive assets. A will will typically go through probate, which can take months and may incur fees, while a trust may impose restrictions or phased distributions. Misunderstanding these details could delay access to funds or have potential legal complications.
2. Tax Implications
Many beneficiaries can be surprised by taxes, including estate taxes, inheritance taxes (depending on your state), and capital gains taxes on investments sold. Retirement accounts like IRAs or 401(k)s typically have strict withdrawal rules as well. Without professional guidance, a misstep here can lead to unwanted tax bills and potentially lost wealth.
3. Emotional and Family Dynamics
Inheritance often comes during a period of grief or loss. Decisions made while under stress could lead to overspending, poor investments, or even family disputes. Without clear guidance and communication, these situations could lead to conflict or financial regret.
4. Revisiting Your Own Financial Plan
An inheritance can shift your goals, risk tolerance, and financial future overnight. Your old financial plan may no longer fit the amount and type of assets you now own. Revisiting your financial plan can ensure you understand how the inheritance can impact you and your family now and into the future.
4. Updating Your Estate Documents
Suddenly receiving a large sum can potentially reveal gaps in your own estate plan. Without a well-designed strategy, you risk depleting your inheritance quickly or failing to protect assets for future generations.
5. Honoring the Legacy
Inheritance is often about more than money; it reflects a loved one’s values and intentions. Failing to consider the legacy can lead to decisions that ignore the purpose behind the gift.
6. Not Working with a Qualified Professional
Perhaps one of the most critical mistakes is trying to navigate a complex inheritance without guidance. Without professional guidance, it’s easier to mismanage taxes, misinterpret a will or trust, or potentially make investment mistakes that could erode your wealth. Working with a financial advisor can help ensure your inheritance is handled correctly, protects your financial future, and preserves the legacy intended by the person who passed along the assets. The stakes are high, and mistakes could turn a blessing into a costly mistake.
An inheritance can be both a gift and a responsibility. To protect your wealth, honor your loved one’s legacy, and make smart, strategic decisions, consider reaching out to Confluence Financial Partners. Our team of professionals can help guide you through each step of the inheritance process, helping you turn this opportunity into a lasting foundation for your financial future.
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7 Myths About Wealth Management—Debunked
What is wealth management, really?
At its core, wealth management is a long-term, relationship-based approach to structuring your financial life. It goes far beyond investment advice, encompassing comprehensive planning across key areas such as tax strategy, retirement readiness, risk management, estate planning, and more. The goal? To align your financial decisions with your life goals, values, and priorities, both now and in the future.
Still, many people misunderstand what wealth management truly is, and what it isn’t. Let’s begin by addressing seven common myths.
Myth #1: Wealth management is only about growing your investments.
Reality: While growing your assets is a piece of the puzzle, wealth management is about far more. It includes protecting what you’ve built, planning for major life events, and preparing for transitions like retirement or business succession. Growth is just one component of a much broader, comprehensive planning process.
Myth #2: It’s just investment advice.
Reality: Investments are only one tool in a larger strategy. True wealth management takes into account your entire financial life including income, taxes, estate plans, insurance coverage, and long-term goals, and coordinates them all into a personalized plan.
Myth #3: You can DIY if you simply do enough research.
Reality: While self-education is valuable, effective comprehensive planning requires more than access to information. It takes experience, objectivity, and the ability to coordinate multiple moving parts. A good wealth manager helps you avoid blind spots and ensures your decisions are cohesive and future-focused.
Myth #4: It’s a one-time engagement.
Reality: Wealth management is a long-term relationship that evolves with your life. Markets change. Families grow. Laws shift. Ongoing adjustments are essential to keep your plan relevant and to make the most of your opportunities over time.
Myth #5: All wealth managers are the same.
Reality: Not all advisors provide true comprehensive planning. Some are investment-focused, while others serve as fiduciaries, offering a broader range of coordinated services. It’s important to understand the advisor’s scope and approach before committing to a relationship.
Myth #6: It’s too expensive.
Reality: Strategic financial guidance can help you avoid costly mistakes, uncover efficiencies, and make informed decisions that build value over time. The cost of wealth management is often offset by the clarity and confidence it brings as well as the opportunities it helps unlock.
Myth #7: If I have a 401(k), my retirement is covered.
Reality: A 401(k) is a great tool, but it’s not a plan. Comprehensive planning connects your retirement savings with the rest of your financial picture, ensuring that your income needs, tax exposure, and estate goals are all working together, not in isolation.
Final Thoughts
Wealth management is more than a one-time service. It’s a long-term commitment to clarity, alignment, and strategic decision-making. By debunking myths around wealth management, you can better understand how the right advisor and a comprehensive planning approach can help you move forward with confidence.
At Confluence Financial Partners, we believe wealth management should be personal, purposeful, and deeply aligned with what matters most to you. Our team is made up of experienced professionals specializing in areas such as financial planning and investment strategy, working together to create the best possible plan tailored to your needs. We also coordinate closely with other financial professionals in your life such as your CPA or attorney to ensure all aspects of your financial picture are working together seamlessly.
Ready to create a plan designed just for you? Contact us today to get started on your path to greater financial confidence.
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The One Big Beautiful Bill Act: A Closer Look at Key Tax Changes for Individuals and Business Owners
The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, is one of the most comprehensive tax reforms since the 2017 Tax Cuts and Jobs Act (TCJA). While originally many TCJA provisions were set to expire at the end of 2025, OBBBA makes several of them permanent and introduces new deductions and planning opportunities. For both individual taxpayers and business owners, the legislation introduces significant changes that will affect financial strategies for years to come.
What Provisions Are Now Permanent?
OBBBA locks in several of the tax code changes first introduced under TCJA. These are no longer set to expire:
Marginal tax rates remain at their current levels: 10%, 12%, 22%, 24%, 32%, 35%, and 37%. The lower 10% and 12% brackets are a little wider and the 22% bracket is narrower. All brackets will continue to be adjusted for inflation annually.
Standard deduction levels, which were roughly doubled by TCJA, are now permanent. For 2025, this now means $15,750 for single filers, $23,625 for head of household filers, and $31,500 for joint filers.
Personal exemptions remain eliminated.
Estate tax exemption is permanently increased and set to $15 million per individual beginning in 2026.
The Child Tax Credit increases to $2,200 per child, and for the first time, the credit amount will be indexed to inflation beginning in 2026.
The Qualified Business Income (QBI) deduction, also known as the Section 199A deduction, is permanently available for pass-through businesses, with continued income thresholds and limitations for specified service trades or businesses (SSTBs).
Temporary Enhancements for Individual Taxpayers
While many TCJA provisions are now permanent, OBBBA also introduces several new or enhanced deductions—many of which are temporary, lasting only through 2028 or 2030.
New Senior Deduction (2025–2028)
Taxpayers age 65 or older can now claim a separate below-the-line deduction of $6,000 (or $12,000 for joint filers where both spouses are 65+). This is in addition to the standard deduction and is available whether the taxpayer itemizes or not. This was marketed as “no tax on Social Security,” but Social Security income taxation remains unchanged.
However, this benefit phases out for higher-income seniors:
Begins to phase out at $75,000 of modified adjusted gross income (MAGI) for single filers.
Begins to phase out at $150,000 MAGI for joint filers.
This deduction provides meaningful relief for lower- and middle-income retirees, especially those not drawing heavily from tax-deferred retirement accounts.
Expansion of the State and Local Tax (SALT) Deduction (2025–2029)
The $10,000 SALT deduction cap is not eliminated, but it is temporarily raised to $40,000 for individual taxpayers whose MAGI is below $500,000:
Applies for tax years 2025 through 2029.
For those filers (single, head of household, or joint) above the MAGI threshold, the higher cap amount begins to phase back down to $10,000 once income reaches $600,000.
In 2030, the cap reverts to $10,000 for all taxpayers unless further legislative action is taken.
This creates meaningful short-range planning opportunities for taxpayers in high-tax states, particularly those under the income threshold.
Other Targeted Deductions and Adjustments
OBBBA adds a handful of new deductions designed to support working-class and lower-middle-income taxpayers, though many are capped and subject to phase-outs.
Below-the-Line Charitable Deduction (Starting in 2026)
Beginning in 2026, taxpayers who either take the standard deduction or itemize will be allowed to deduct a portion of their charitable contributions:
Up to $1,000 for single filers.
Up to $2,000 for married couples filing jointly.
This provision revives and slightly expands the temporary charitable deduction that existed during the COVID pandemic and encourages broader charitable participation. Donations must be made similarly in cash and cannot be made to supporting organizations or donor advised funds.
Taxpayers who elect to itemize their charitable contributions are now subject to a 0.5% of AGI floor beginning in 2026. Notably, the 0.5% reduction is carried forward to the following year only if the contribution exceeds the AGI limit and is deferred to a future year. As a result, it can sometimes make sense to contribute more than the annual AGI limit, since doing so allows the 0.5%-of-AGI reduction to be “used” later instead of otherwise being simply lost. Additionally, taxpayers in the top marginal bracket of 37% will only be able to deduct 35 cents of every dollar (2/37ths reduction).
Deduction for Tip Income (2025–2028)
A new below-the-line deduction allows service industry employees to deduct up to $25,000 of qualified tip income from their taxable income. Income from tips is still subject to payroll tax, included in adjusted gross income (AGI), and may also be subject to state income tax.
The deduction phases out starting at $150,000 of MAGI for single or head of household filers and $300,000 for joint filers.
To qualify, the taxpayer must work in an occupation that “traditionally and customarily” received tips prior to 2025, and the tips must be voluntary and not mandated as part of the service provided.
This benefit is limited to tax years 2025 through 2028.
Deduction for Overtime Pay (2025–2028)
Workers who earn additional compensation from overtime can deduct below-the-line:
Up to $12,500 of overtime income (single).
Up to $25,000 (married filing jointly).
As with the tip deduction, phase-outs begin at MAGI of $150,000 for single and head of household filers and $300,000 for joint filers. This deduction is also limited to the 2025–2028 period.
Deductible Auto Loan Interest (2025–2028)
Taxpayers can deduct interest on auto loans (taken out after December 31, 2024), but only under specific conditions:
The vehicle must be new, for personal use, and assembled in the United States. A car VIN starting with digits 1, 4, 5, or 7 indicates the car was assembled in the USA.
The deduction is capped at $10,000 of interest over the life of the loan.
MAGI phase-outs apply: $100,000-$149,000 for singles and $200,000-$249,000 for joint filers.
Applies only through 2028.
This provision aims to promote domestic car manufacturing and ownership, especially for middle-income households.
Business Owners: Key Considerations
Qualified Business Income (QBI) Deduction
The Section 199A QBI deduction remains intact and permanent. Business owners should continue monitoring the slightly increased income phaseout ranges of $75,000 and $150,000 over the taxable income thresholds of $191,950 single / $383,900 joint in 2025, respectively.
AMT (Alternative Minimum Tax) Changes
OBBBA reduces the AMT exemption phase-out thresholds, making more upper-income taxpayers potentially subject to AMT.
Although the base exemptions remain similar, more taxpayers earning between $500,000 and $1 million may need to recalculate.
For small business owners, this means more intricate AMT exposure modeling may be necessary to avoid surprises. The interplay between the QBI deduction and the AMT may become more relevant, especially after 2030, when the SALT cap reverts.
100% bonus depreciation of business property placed into service after January 19, 2025 is permanently restored and Section 179 deduction limits are increased to $2.5 million in aggregate total cost on up to $4 million in total Section 179 property.
Other Notable Updates
New “Trump Accounts” are introduced, which can be opened and funded on behalf of any individual with a Social Security number from birth up until the year before the year in which they turn 18.
The federal government will pilot a program to contribute $1,000 via taxpayer credit per U.S. citizen born in 2025, 2026, or 2027.
Families can contribute up to $5,000 annually indexed to inflation starting in July 2026.
Accounts function similarly to traditional IRAs and are designed for general future savings. No distributions are allowed before the year the beneficiary turns 18 and the only eligible investments are low-fee U.S. equity funds. If the beneficiary dies prior to the year in which they turn 18, the account loses its tax-deferred status and is fully taxable to the designated beneficiary.
In the year the beneficiary turns 18, distributions are permitted but early withdrawal penalties are assessed before age 59 ½. Withdrawals of direct contributions are tax-free but earnings or excluded contributions are taxable.
Required minimum distributions (RMDs) and the 10-year rule for IRAs will likely apply to these accounts. More guidance is needed to determine if these types of accounts can be rolled over to other IRAs or converted to a Roth IRA.
Qualified Small Business Stock (QSBS) capital gain exclusion has increased from $10 million to $15 million for QSBS acquired after July 4, 2025. There is a partial gain exclusion if held for less than 5 years.
Student Loans
Federal student loan borrowers will now face a number of changes effective on July 1, 2026. It will significantly curtail most direct borrowing and limit educational opportunities for less affluent families unless they are able to borrow privately:
GraduatePLUS loan program eliminated (grandfathered in before July 1, 2026)
ParentPLUS annual and aggregate loan limits of $20,000/yr and $65,000 per dependent student, respectively
Graduate and professional annual and aggregate loan limits of $20,000/50,000/yr and $100,000/$200,000 total
$257,500 lifetime borrowing limit on all federal student loans, excluding borrowed ParentPLUS loan amounts
Student loan repayment options simplified to standard repayment plan (10, 15, 20, or 25 years), income based repayment (IBR) plan, or new Repayment Assistance Plan (RAP). Current borrowers will need to elect one of these options by July 1, 2028 or default to RAP.
RAP has a $10 minimum monthly payment and borrowers will pay 1% to 10% of their monthly income for up to 30 years. There is no cap on monthly payments, even if they are greater than the standard repayment plan. However negative amortization is eliminated.
Opportunity Zones and Education
OBBBA renews and expands Qualified Opportunity Zones, which allow for the deferral and potential exclusion of capital gains invested in targeted communities. The definition of low-income areas will be slightly more restrictive and investors can begin deferring capital gains into new Qualified Opportunity Funds (QOFs) again in 2027.
529 plans now allow withdrawals for certain non-college expenses, such as workforce certifications and educational supplies.
These changes broaden the use of tax-advantaged accounts and should be considered when reviewing education and estate planning strategies.
Many clean energy credits will be repealed by year end instead of the originally scheduled sunset dates between 2032 and 2035.
Final Thoughts: What This Means for Planning
OBBBA delivers both permanency and novelty. While it removes the looming TCJA expiration cliff, it introduces a handful of temporary deductions and phase-outs that clients must navigate carefully.
The most effective plans will be those that adapt to the temporary and permanent elements of OBBBA. This legislation reinforces the idea that financial planning isn’t a one-time activity—it’s a dynamic process that evolves with the law, and your financial plan should too.
Please reach out to your Confluence Financial Partners wealth advisor with any questions.
Sources:
119th Congress (2025-2026) | Library of Congress. (2025, July 4). H.R.1 – One Big Beautiful Bill Act. Congress.gov https://www.congress.gov/bill/119th-congress/house-bill/1/text
Henry-Moreland, B. (2025, July 17). Breaking Down The “One Big Beautiful Bill Act”: Impact Of New Laws On Tax Planning. Nerd’s Eye View | Kitces.com https://www.kitces.com/blog/obbba-one-big-beautiful-bill-act-tax-planning-salt-cap-senior-deduction-qbi-deduction-tax-cut-and-jobs-act-tcja-amt-trump-accounts/
NASFAA. (2025, July). Federal Student Aid Changes from the One Big Beautiful Bill Act. National Association of Student Financial Aid Administrators. https://www.nasfaa.org/uploads/documents/Federal_Student_Aid_Change_OB3_July2025.pdf -
Retirement Planning Tips for a More Comfortable Future
Retirement planning is one of the most important financial steps you can take to help create a comfortable and secure future. Typically, the earlier you start, the better positioned you’ll be to achieve your financial goals. Whether you’re just beginning your career or are approaching retirement, having a structured plan is essential. In this blog, we’ll explore key tips for effective retirement planning, review the various savings vehicles available, and discuss how a wealth management firm like Confluence Financial Partners can help you stay on track.
Start Retirement Planning Early
We believe one of the best things you can do for your future self is to start retirement planning as soon as possible. The power of compound interest can allow your savings to grow exponentially over time, meaning the earlier you begin, the less you need to contribute later. Even if retirement feels far off, taking small, consistent steps today can make a significant impact.
For example, Mia saves $200 per month for 40 years, while Jennifer waits 10 years to start but doubles her contribution to $400 per month for 30 years. Despite contributing twice as much, with a 6% return, Jennifer would have $827,062, whereas Mia, also with a 6% return would have $987,428. By waiting just 10 years to start, even twice the monthly contribution is not enough to catchup. This demonstrates the power of compound interest—starting earlier, even with smaller contributions, can yield greater long-term benefits than larger contributions made later.
The hypothetical examples assume an 6% average annual return. These are point-in-time views and as such do not take into account any growth or loss during retirement. Without investment growth/loss during retirement, a 4% annual withdrawal rate would deplete retirement savings in 25 years. Examples are for illustrative purposes only and do not reflect the results of any particular investment, which will fluctuate with market conditions, or taxes that may be owed on tax-deferred contributions, including the 10% penalty for withdrawals taken before age 59½. Regular investing does not ensure a profit or protect against loss in a declining market. These numbers do not reflect any fees charged to the account.
Set Clear Retirement Goals
Understanding what you want your retirement to look like can help shape your savings strategy. Consider factors such as at what age you want to retire, the lifestyle you wish to maintain, and any significant expenses like travel or healthcare. Establishing clear, realistic goals will help guide your investment and savings decisions.
Understand Your Retirement Savings Vehicles
A variety of savings vehicles are available to help you build a strong retirement portfolio. Each comes with unique advantages and benefits:
Employer-Sponsored Plans
- 401(k) & 403(b) Plans – Many employers offer these tax-advantaged retirement accounts. Contributions to traditional 401(k) and 403(b) plans can be made pre-tax, reducing your taxable income, and in some cases, after tax into Roth 401(k). Some employers even provide matching contributions, which is essentially free money toward your retirement.
- 457 Plans – Available to government employees and some non-profit workers, this plan allows tax-deferred savings with flexible withdrawal options.
- Pension Plans – Some companies offer defined-benefit pension plans, which provide a set income stream in retirement. These plans were common in the past, but in present times, few companies offer pension plans.
Individual Retirement Accounts (IRAs)
- Traditional IRA – Contributions may be tax-deductible (dependent on one’s annual income), with tax-deferred growth until withdrawals in retirement.
- Roth IRA – Contributions are made after tax, but qualified withdrawals are completely tax-free, making this a great option for long-term tax planning. Roth IRAs are only available to those earning under preset IRS levels which adjust annually.
- SEP IRA & SIMPLE IRA – These plans are ideal for self-employed individuals and small business owners, offering higher contribution limits than traditional IRAs.
Self-Employed & Alternative Retirement Plans
- Solo 401(k) – Designed for self-employed individuals, this plan allows for both employee and employer contributions, maximizing tax-advantaged savings.
- Health Savings Account (HSA) – While primarily for medical expenses, HSAs can be used as a long-term savings tool due to their tax-free growth and withdrawal benefits. Funds are contributed pre-tax and may be used tax free for approved health related expenses. Distributions that are not used for qualified medical expenses are taxed as ordinary income and avoid a 20% penalty if you are age 65 and older or disabled. In these instances, an HSA can supplement your retirement savings approach similar to a traditional IRA.
Diversify Your Investments
A well-rounded retirement plan should include diversification across various asset classes. Stocks, bonds, mutual funds, exchange traded funds (ETFs), and other investments help manage risk while helping to optimize growth. Balancing your portfolio based on your risk tolerance, time horizon, and retirement goals can be very impactful to long-term financial success.
Work with a Wealth Management Firm
Retirement planning can be complex, and partnering with a trusted financial advisor or certified financial planner can help you navigate the process. A wealth management firm like Confluence Financial Partners provides professional guidance, helping to ensure you have a personalized strategy tailored to your unique financial situation. Here’s how they can assist:
- Customized Financial Plans – Personalized strategies based on your income, goals, and risk tolerance.
- Investment Management – Diversified portfolio strategies designed to grow and protect your wealth.
- Tax-Efficient Planning – Structuring your withdrawals and contributions to minimize tax liabilities.
- Ongoing Adjustments – Life circumstances change, and your plan should evolve accordingly. A professional team helps you stay on track to meet your retirement goals.
Stay Consistent and Review Your Plan Regularly
Retirement planning is not a one-time event but an ongoing process. Regularly reviewing your retirement savings, investment allocations, and financial goals help to ensure that you remain on the right path. Making necessary adjustments as life changes—whether due to career shifts, market fluctuations, or personal circumstances—keeps your retirement strategy aligned with your objectives.
Conclusion
Retirement planning can be essential for financial security and peace of mind. By understanding the various savings vehicles available, diversifying your investments, and working with a wealth management firm like Confluence Financial Partners, you can create a roadmap to a successful retirement. The key is to start early, stay informed, and seek professional guidance when needed. With the right plan in place, you can enjoy your retirement years with confidence and financial stability.
Ready to take control of your retirement planning? Contact Confluence Financial Partners today to begin your journey toward a secure and prosperous future.
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A Strategic Approach to Balancing College Costs and Retirement Goals
For many parents, the desire to fund their child’s education is strong. Striking the right balance between saving for college and ensuring a secure retirement, however, requires careful financial planning. With the right strategies, families can make progress towards both priorities without unnecessary financial strain.
Why Parents Should Consider Not Sacrificing Retirement for Tuition
It’s natural to want to provide the best opportunities for your children, but delaying or reducing retirement savings to pay for college could have long-term consequences. Unlike college tuition, which offers various funding options like student loans and scholarships, there are no loans for retirement. Prioritizing your future financial security can help ensure that you won’t become a financial burden on your children later in life.
Additionally, withdrawing from retirement accounts early or reducing contributions could mean missing out on years of compound interest, potentially making it harder to reach retirement goals. Instead, parents should aim for a balanced approach that considers both short-term education costs and long-term financial stability.
Strategies for Funding Both Without Financial Strain
Achieving a balance between paying for college and securing retirement requires a well-thought-out plan. Here are some key strategies to consider:
1. Maximize Tax-Advantaged Savings Accounts
Using tax-advantaged savings vehicles can help optimize both education and retirement savings:
- 529 Accounts: A 529 account allows parents to save for college while benefiting from tax-free withdrawals for qualified expenses. Some states also offer tax deductions for contributions.
- Coverdell Education Savings Accounts (ESAs): These accounts offer tax-free growth for education expenses, though they have lower contribution limits than 529 accounts.
- Retirement Accounts (401(k), IRA, Roth IRA): Contributing to retirement accounts should remain a priority. Some retirement accounts allow penalty-free withdrawals for education expenses, but typically this should only be a last resort.
2. Encourage Student Contributions
Students can play an active role in funding their education. Encourage them to apply for scholarships, consider work-study programs, or take on part-time jobs to reduce the financial burden. Student loans are another option, and with strategic borrowing, they can help bridge the gap without overburdening the family.
3. Set a Realistic Budget and Explore Cost-Effective Education Options
Not all colleges come with a hefty price tag. Families could explore in-state public universities, community colleges, or schools that may offer generous financial aid packages. Creating a clear college budget can help costs remain manageable without derailing retirement plans.
4. Work with Confluence Financial Partners to Optimize Your Financial Plan
At Confluence Financial Partners, we can help families develop a comprehensive plan that balances saving for college and retirement. Our wealth managers can provide strategies for:
- Allocating investments to optimize tax advantages
- Adjusting financial priorities based on income and expenses
- Identifying the best ways to use student loans strategically
- Exploring alternative funding sources, such as employer tuition assistance programs
We take a personalized approach, helping you create a strategy that best aligns with your unique financial goals while helping create long-term stability for both education and retirement.
Final Thoughts
Balancing college costs and retirement savings doesn’t have to be an either-or decision. By utilizing smart financial strategies, leveraging tax-advantaged savings vehicles like 529 accounts, and working with a financial planner like Confluence Financial Partners, families can simultaneously plan for their children’s education and their own retirement. It is key to start early, plan strategically, and make informed financial decisions that support long-term financial health.
If you’re ready to create a customized plan that considers both your retirement and your child’s education, contact Confluence Financial Partners today.
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Understanding the Role of a Registered Investment Advisor (RIA) and What It Means for You
When it comes to financial planning and investment management, selecting the right advisor is one of the most critical decisions you can make. One term you may frequently encounter is “RIA,” which stands for Registered Investment Advisor. But what does that really mean, and why is it important for those seeking professional financial guidance?
Understanding an RIA
An RIA is a firm or individual registered with the Securities and Exchange Commission (SEC) or a state regulatory agency, depending on the assets under management. RIAs provide financial advice and investment management services while adhering to strict regulatory requirements designed to protect investors.
At Confluence Financial Partners, being a Registered Investment Advisory means that we are committed to transparency, personalized service, and, most importantly, acting in our clients’ best interests.
The Fiduciary Standard: Acting in Your Best Interest
One of the most significant distinctions of an RIA is the fiduciary duty it upholds. As fiduciaries, RIAs are legally and ethically required to prioritize their clients’ financial well-being above all else. This obligation includes:
- Providing objective advice
- Fully disclosing any potential conflicts of interest
- Ensuring recommendations align with each client’s financial goals
At Confluence, our fiduciary responsibility guides financial strategies and tailors them to your unique situation, helping you pursue goals with confidence.
What to Expect When Working with a Registered Investment Advisor
Choosing to work with a Registered Investment Advisor like Confluence Financial Partners provides several opportunities:
- Personalized Wealth Management: We take the time to understand your specific needs and aspirations, crafting customized financial plans and investment strategies.
- Transparent Fee Structure: Our compensation model is designed to align with your success, with no hidden commissions or incentives.
- Objective Advice: As fiduciaries, we are committed to offering independent, research-driven financial guidance that is in your best interest.
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What This Means for Confluence Clients
For clients of Confluence Financial Partners, our status as a Registered Investment Advisor represents a commitment: our commitment to act with integrity, to provide prudent guidance, and to help you achieve financial confidence. We embrace our fiduciary duty because we believe that trust is the foundation of every successful financial relationship. Whether you’re planning for retirement, growing your wealth, or navigating complex financial decisions, you deserve an advisor who is not only experienced but also required to put your best interests first.
Take the Next Step with an RIA You Can Trust
If you’re looking for a financial partner who prioritizes your goals and well-being, we invite you to start a conversation with Confluence Financial Partners. Let’s work together to build a strategy that aligns with your vision for the future.
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Should Millennials Plan on Social Security?
Social Security, started in the 1930s as a part of FDR’s New Deal, has been under fire since I can remember. All the while, the program has been helping fund the retirement of some 47 million Americans, with another 19 million on survivor or disability benefits. What started out as a way to ensure elderly Americans had some form of income has turned into a major piece of the US economy.
As we help our younger clients plan for retirement, we often hear, “Let’s not plan on Social Security, I don’t think it will be there by the time I retire.” While we understand where this attitude is coming from, we don’t think it reflects reality.
Here’s why:
- Social Security is funded by a separate payroll tax (FICA) that comes out of paychecks up until an individual reaches $160,200 in earned income (2023). That means, that for the first $160,200 each earner makes, 6.2% goes to Social Security, with another 6.2% coming from the employer.
- That’s a total of $19,864 that goes to Social Security for someone who earns $160,200.
- These amounts are then paid out directly to retirees, survivors, and disabled individuals.
As long as there are people working in the United States, there will be money going into, and then out of Social Security.
“But what about the trust fund?”
- As discussed above, Social Security is funded directly from payroll taxes. Up until very recently, the ratio of working to non-working Americans had been high enough that Social Security benefits were fully funded each year.
- However, as Baby Boomers retire and birthrates continue to decline, this is changing. If payroll taxes are not enough to current obligations, the difference is paid by the asset reserves in the Social Security trust fund. As more and more workers retire, the trust fund is expected to be depleted.
By the most recent estimates, the trust fund assets will be spent down by 2034. At that point, Social Security would officially be insolvent.
“That’s what I mean! Once Social Security is insolvent, I won’t get any benefits!”
But what does insolvency actually mean?
- Assuming no legislation is passed to shore up the program, all benefits will be cut to about 79% of what they are today.
- 79% is not 0%. Far from it, in fact, 79% is still solid amount of guaranteed income that the younger generation can plan on as a piece of their overall retirement picture.
“That’s it? That doesn’t sound as bad as what I’ve read in the news.”
No, it doesn’t. For younger workers who have plenty of time to factor such a possibility in their long-term planning, the potential reduction would not be life changing. A relatively modest increase to retirement savings would make up for the potential shortfall.
In reality, Congress will be forced to act, there will likely be changes to Social Security at some point. These changes will probably make sure that current benefits are not cut, and that Americans with no time to adjust will not have the rug pulled out from under them. For younger Americans, the fact remains that as long as we have workers and payroll taxes, Social Security will be there in one way or another.
Disclaimer: This analysis could certainly change pending action by Congress. We are in no way trying to predict the future, but we believe this analysis is reasonable based on the current landscape.