January 30, 2019

It’s been a little while since the last blog post and a lot has changed since then – new name, team member, and location. We’ve been busy around here and the start of new calendar years doesn’t tend to slow things down. In the interest of getting the year started off right, I thought it might be helpful to share some thoughts about topics that impact most people in one way or another. Here are a few things to think about as we get going in 2019:

  1. Tax Planning: Taxes impact pretty much everyone and even though they make for some boring fodder for blogs, they do tend to get everyone’s attention. Tax laws changed relatively dramatically on January 1, 2018 and this year’s return will be the first look into how those changes may impact you. Changes in withholding didn’t take place until a few months into the year and there were some reports that individuals in certain income ranges may not have withheld enough from their paychecks. Your 2018 return should give you a pretty good idea if adjustments are necessary.


For those of you that are retired, if you’re over 70.5 and don’t need all the income generated from your required minimum distribution AND you have charitable interests, a Qualified Charitable Distribution could be an option.[1] If you end up with a large refund, it may also be a good time to decide if you should adjust withholding levels from IRA or annuity distributions (this could also save you tax dollars by lowering your gross distribution (income)[2]).


Because 2019 was also a relatively active year for capital gain payouts, assessing the tax-efficiency of your portfolio in taxable (read: non-retirement) accounts could give you greater control over when you realize capital gains.[3]


For our clients, this is also a reminder that your tax documents will be delivered in waves, with those for retirement accounts already available online and those that will be mailed being sent out by the end of January. The second wave, for taxable accounts, will go out mid-February, followed by a late February and mid-March mailing, depending on the holdings in your account. As always, those with taxable accounts that hold real estate should expect later final versions of their 1099s.


  1. Retirement plan contributions have changed: For those of you contributing to either employer sponsored retirement plans (like a 401(k)) and/or Traditional and Roth IRAs, your contribution limits have gone up. The maximum amount an employee can defer to a 401(k) is now $19,000, with an additional $6,000 for the over 50 crowd. IRAs and Roth IRAs now allow for $6,000 contributions and an additional $1,000 if you’re 50+. SIMPLEs, SEPs, and other employer plans also saw increases.  Income limitations may apply. [4]

  2. Updating your financial and investment plan (also, having one in the first place): Considering that the last year has seen notable tax code changes and the return of significant market volatility (which is frankly more normal than some think[5]), now is as good a time as any to either re-evaluate your financial and investment plan or just to make sure that you have one at all. The biggest reason why most people abandon investment strategies during times of market stress is that they don’t really have one in the first place. We’ve written extensively on the differences between strategic and tactical asset management.[6] The truth is, which you choose is infinitely less important than your willingness to stick with it when times get tough, and that will happen regardless of your chosen strategy. Financial plans are integral in this role, as well, as they can help you understand the impact that market losses will have on your plan in the long-run (in many cases, conservative plans can provide more wiggle room so that even large market losses don’t impact long-term potential for reaching your goals). Plans can also help you decide the when, how, and how much to save in, or withdraw from, retirement and other savings accounts. And to keep you both up-to-date and accountable, we can also give you the tools necessary to track this in a simple and convenient way.


If you haven’t spent a lot of time in the last year or so re-examining (or examining) your financial situation, it probably makes a lot of sense to do so. Changes in the tax code, savings limits, and recent market events all make for worthwhile talking points. Plus, if you’ve consistently addressed your concerns in all of these areas, you can feel free to just hit ‘delete’ the next time you see a blog post like this show up in your email and go back to watching ‘The View’ or ‘The Price is Right’ or Keeping up with the Somebodies and feel better about your life decisions.


This is meant for educational purposes only.  It should not be considered investment advice, nor does it constitute a recommendation to take a particular course of action. Please consult with a financial professional regarding your personal situation prior to making any financial related decisions.  LPL Financial does not provide tax advice.