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Charitable Gifting from your IRA

Written by Brandon Grundy, CFP®.

Making a Qualified Charitable Distribution from your IRA: If you are taking Required Minimum Distributions (RMD) each year you should be allowed in 2015 to gift up to $100,000 directly to charity and not pay income tax on the distribution. Congress, in its infinite wisdom, has not made this provision permanent and keeps reinstating it year-to-year, so many people are not aware of this option.

Here's how it works: If you are RMD-age, consider setting up a distribution from your IRA that goes directly to one or more charities (maybe even to one you would have gifted to anyway by writing a check from your checking account). You would not get a charitable deduction on the donation but you would not have to pay income taxes on the distribution from your IRA. The charity gets the money it needs and you likely come out ahead by lowering your taxable income. But remember that Congress has yet to reinstate this provision for 2015. They likely will but it might not be until late in the year. Start thinking about this now and stay tuned... I will keep you informed.  

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Will I ever be able to retire?

Written by Brandon Grundy, CFP®.

How do you envision your retirement years? Do your finances match your vision? Many people wonder: "Will I ever be able to retire?

There are strategies galore about how to plan for retirement. You've probably heard of some of them. There's the 4% Rule which says that so long as you take only 4% from your portfolio each year, you'll be fine. Then there's the rule telling you that the amount of bonds you own should match your age. Then there's the Million-Dollar Rule implying that you shouldn't even think of retiring until you've accumulated your first million (or two, or three...). There are strategies to help you save more and spend less. There's one involving buckets. Spend a little time Googling "How to Plan for Retirement" and you'll find dozens of one-size-fits-all strategies for retirement planning.

The problem: It's rare that one of these strategies will fit you and your life perfectly. This is where personal comprehensive financial planning comes in. Financial planning involves looking at your life, goals, finances, and vision and then crafting ways to help you reach your goals.

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Ridgeview What?

Written by Brandon Grundy, CFP®.

It's said that a journey of a thousand miles begins with a single step. I agree with this but it feels like there are many first steps leading you to that first, single step.

Well, this is my "single step". After years of working in the brokerage industry and thinking that there must be a better way, I am opening my own fee-only registered investment advisory firm. What is a fee-only registered investment advisory firm, you ask?

First, it's a mouthful so let's just call it a RIA. RIA firms help investors with financial planning, their investments, and do so in a way that's different from what you might expect. When most people think of investments they either quickly think of something else, or they imagine going to visit a "stockbroker" who sells them a hot stock or a can't-lose mutual fund. Sounds fun, right? The broker charges them a commission (usually a large one) and then calls you when there's another hot investment they want to sell you. Oh, and they also charge another commission.

There's a fundamental flaw in this scenario caused by three main factors:

First, when you go visit the broker you're at a disadvantage because they (presumably) know more than you do about investing and how the markets work.

Second, the broker has no incentive to help you, give you advice, etc, unless they sell you something. So they're going to try and sell you something, period.

Third, the broker doesn't have any legal liability for what they've sold to you, other than to try to ensure it's "suitable" when they recommend it. (This means they just need to ask some basic questions and, if you answer yes, they can call the investment suitable. Even though it may not be.)