financial planning Archives - Blakely Financial

What to Know About 401(k) Contributions

Posted on September 6, 2024September 10, 2024 by Donna Blakely

For 2024, the IRS announced a change in the contribution limit for employees who participate in 401(k), 403(b), and most 457 plans, as well as the federal government’s Thrift Savings Plan. Annual contribution limits increased to $23,000 from $22,500 as a cost of living adjustment. The catch-up contribution limit for employees aged 50 and over who participate in 401(k), 403(b), and most 457 plans, as well as the federal government’s Thrift Savings Plan, remains unchanged at $7,500.

What does this mean for me?

If your employer offers benefits such as retirement plans, you will want to make sure you are taking advantage of everything offered to you to save for retirement. In order to take full advantage of this, it is important to understand any changes to contribution limits.

If you are already making the maximum contribution to your 401(k) each year, increases in contribution limits are good news for you, as you will be able to set even more money aside for retirement. If you are looking to maximize your retirement fund, you may want to consider contributing to both your employer-sponsored retirement plan and an IRA.

Making the Most of your 401(k)

One of the most important financial planning strategies when saving for retirement is maximizing your employer’s 401(k) match if offered. This extra money can significantly boost your retirement fund, especially if you consistently contribute enough to receive the maximum match. Take the time to thoroughly read over your company’s plan with your financial advisor to ensure you understand the specifics and make the most of your money.

Key Points to Remember About a 401(k)

Here are a few key points to keep in mind about a 401k):

A 401(k) is a retirement savings plan, so once you put money in, it is always best to leave it in.
There are penalties if you take the money out of your 401(k) before you hit retirement age.
If you change employers, you can roll your vested balance into your new employer’s 401(k) plan or into another qualifying retirement account such as an IRA.

Take advantage of any type of savings plan offered by your current employer. The earlier you begin and the more aggressive you are, the closer you will be to achieving your financial goals. If you have further questions about your 401(k), retirement savings, or any other aspect of your financial plan, it is always a great idea to speak with your financial advisor for guidance. Contact the Blakely Financial team today to get started.

If you are considering rolling over money from an employer-sponsored plan, you often have the following options: leave the money in the current employer-sponsored plan, move it into a new employer-sponsored plan, roll it over to an IRA, or cash out the account value. Leaving money in a plan may provide special benefits including access to lower-cost investment options; educational services; potential for penalty-free withdrawals; protection from creditors and legal judgments; and the ability to postpone required minimum distributions. If your plan account holds appreciated employer stock, there may be negative tax implications of transferring the stock to an IRA. Whether to roll over your plan account should be discussed with your financial advisor and your tax professional.

Blakely Financial, Inc. is an independent financial planning and investment management firm that provides clarity, insight, and guidance to help our clients attain their financial goals. Engage with the entire Blakely Financial team at WWW.BLAKELYFINANCIAL.COM to see what other financial tips we can provide towards your financial well-being.

Commonwealth Financial Network® or Blakely Financial does not provide legal or tax advice. You should consult a legal or tax professional regarding your individual situation.

Building Wealth: Owning Real Estate

Posted on September 5, 2024September 10, 2024 by Donna Blakely

Owning real estate has long been regarded as a key strategy for accumulating wealth. For high-net-worth individuals and experienced investors, real estate offers distinct opportunities to not only preserve wealth but also generate substantial returns. In this blog, we will explore how residential real estate can be used to build wealth and diversify your investment portfolio.

Long-Term Benefits of Owning Real Estate

-Owning real estate offers significant advantages, particularly for those seeking long-term stability and growth. Whether you’re purchasing a primary residence or acquiring an investment property, both approaches can provide substantial returns. In the case of an investment property, you benefit from the ability to write off operational expenses, reducing your taxable income while capitalizing on property appreciation rates, which often outpace inflation in high-demand areas.

For high-end real estate, appreciation is typically more pronounced, driven by market exclusivity and demand for luxury living. Premium properties can see appreciation well beyond the average 3-5% per year, particularly in top-tier markets. Additionally, luxury real estate can serve as a hedge against market volatility, offering a tangible asset class. By diversifying into real estate, you can help mitigate risk and have potential for steady, long-term returns.

Short-Term Benefits of Strategic Property Investments

High-net-worth investors can also benefit from short-term real estate strategies. One option is acquiring properties in need of renovation, transforming them into high-end homes, and selling at a significant profit—a practice known as “flipping.” However, for those with a long-term wealth-building mindset, another approach is acquiring multi-family residences, living in one unit, and renting out the others.

This strategy not only provides immediate rental income but also offers a tax-efficient way to expand your real estate holdings while benefiting from lower primary residence interest rates. Over time, as you make strategic improvements, you increase the property’s value and rental income potential. By repeating this process across multiple properties, you can build a robust real estate portfolio with relatively modest initial capital.

Enhancing Your Wealth Through Real Estate

Whether you are looking to expand your portfolio with luxury real estate or explore high-end investment properties, Blakely Financial is here to support your financial goals. We understand the unique needs of high-net-worth individuals and can provide strategic guidance on integrating real estate into your comprehensive wealth management strategy.

Contact us today to discover how investing in real estate can elevate your financial plan and help you achieve long-term financial success.

Blakely Financial, Inc. is an independent financial planning and investment management firm that provides clarity, insight, and guidance to help our clients attain their financial goals. Engage with the entire Blakely Financial team at WWW.BLAKELYFINANCIAL.COM to see what other financial tips we can provide towards your financial well-being.

Commonwealth Financial Network® or Blakely Financial does not provide legal or tax advice. You should consult a legal or tax professional regarding your individual situation.

Caring for Aging Parents

Posted on August 12, 2024 by Emily Promise

Today, individuals are living longer than ever before, and therefore it is important to be prepared for these later years. Caring for aging parents is one aspect of aging that can be particularly difficult to balance within your planning. In this blog, we are sharing tips for caring for aging parents, helping you prepare to support yourself and your loved ones throughout every stage of life.

Have the Difficult Conversation

The first step, and often the most challenging one, is to have a conversation with your parent to find out what they need or expect from you. Your parent may resist this discussion at first as they have lived a long time without full assistance from you, and accepting your new role in their life may be tricky to handle. Despite these feelings, it is important to have this conversation early on before a crisis occurs. Understanding and respecting your parent’s wishes can also significantly smooth the process.

Gather Information and Documents

It is essential to create a list of emergency contacts, including your parent’s medical providers, religious leaders, neighbors, friends, and financial, tax, and legal advisors. You should also gather copies of various documents including any legal documents, funeral plans, medical records, and medication information. Additionally, keep a current list of investment, bank, and insurance accounts, and locations of safe deposit boxes, real estate deeds, and automobile titles. It may be helpful to keep all of this information in one place, like on a USB drive, so it is readily available when you need it.

Evaluate Your Parent’s Situation

Evaluating your parent’s mental and physical capabilities and locating community services and programs to support their independence is critical, but can also be difficult for you to do on your own. In this case, a geriatric care manager can be vital, especially if you live some distance from your parent. This person can perform an in-home assessment, determine your parent’s housing needs, and recommend a plan of action based on their evaluation. Ask your parent’s doctor for a referral to a qualified geriatric care manager. The following are some questions you and/or a geriatric care manager will answer during this evaluation:

Can your parent remain at home? If your parent can no longer care for their home, it does not necessarily mean they have to move. In fact, staying in one’s home may offer better support and social networks than moving in with one’s children! If your parent can safely stay alone, consider dividing household chores up among family members or hiring someone to provide housekeeping, cooking, and personal care. As parents grow older, an assisted living facility or retirement community may be a better solution than living at home as these residences provide additional benefits such as transportation, access to medical personnel, and a richer social life.
Can your parent move in with family? Moving your parents into your or another family member’s home is also a solution. This is not the best choice for every family, and that is okay! Ask yourself:

- Will living together put stress on your relationship with your parent or with your family?
- Can you afford to remodel or renovate your home to provide a comfortable and private environment for your parent?
- Do you have the flexibility in your schedule to provide the necessary transportation?
- Will other family members step in to help, both physically and financially?
Can your parent continue to drive? Individuals over the age of 75, taking medications, or both, may have an impaired ability to drive a car. It may be difficult to know when older drivers have become a danger to themselves or others. Consider giving your parent’s friends and neighbors your contact information and ask them to make you aware of any changes in his or her driving skills, or suggest that they accompany you for errands rather than driving alone. Many communities offer driver’s education courses that teach best practices for seniors, including limiting drive time to daylight hours and good weather conditions and avoiding high-traffic situations. Again, this may be a very sensitive topic of conversation for your parent. For help approaching the conversation, visit the NIH National Institute on Aging website on older drivers.

Financial and Legal Issues Associated with Caring for Aging Parents

With age comes a loss of mental alertness, causing a higher likelihood of due dates for bills passing, insurance policies lapsing, and making poor financial decisions. Your aging parent will likely need your assistance with their financial, legal, and medical matters including:

Banking: Most banks will offer automatic bill payment services from checking or savings accounts, which is a convenient and ideal option if your parent is internet savvy. There is also the option of your parent giving you responsibility for their finances by having bills and financial statements sent to your address instead of theirs. You may also consider a bill-pay service, which receives a copy of invoices and then requests your parent’s bank or financial institution to send checks directly to payees.
Investments: If the day-to-day management of your parent’s finances is too much for you to handle yourself, reach out to your financial advisor. They will be able to recommend products that provide income on a regular basis, such as managed retirement income portfolios or bonds. They may also propose cash-management solutions allowing your parent’s monthly social security, retirement plan, and other payments to be automatically deposited into an account. You are typically able to access these funds via a debit card, unlimited check-writing capabilities, and online bill-pay services – everything that a bank checking account offers.
Insurance: Review your parent’s existing life and long-term care insurance coverage to make sure it still aligns with their needs and wishes. Make changes if necessary.
Legal Concerns: An elder law attorney can help you prepare documents to manage your parent’s health care and financial affairs, and many states even provide free legal services to the elderly. Your parent may wish to seek an attorney’s help in a variety of areas, including appointing a health care representative, understanding the process for qualifying for government programs such as Medicaid or veterans’ benefits or reviewing and updating estate planning documents, including their will, durable power of attorney, and any revocable trusts.

Taking Care of Yourself

Caring for aging parents can feel overwhelming at times, but you are not alone. Many local and national groups are available to support you in providing the care and services your parent and family need. For more information and to get started, visit the U.S. Administration on Aging’s Eldercare Locator.

Talk with your HR department to find out if you are eligible for leave under the FMLA, and ask about the availability of an employee assistance program (EAP). EAPs are intended to help employees deal with personal problems, including concerns about aging parents, that might adversely impact their work performance, health, and well-being.

Lastly, seek the help of your financial advisor. Not only can they help review whether your parent’s resources are sufficient to pay for care, but they can also help you determine how to balance your own goals with your parent’s needs. Contact the Blakely Financial team today to begin your planning.

Blakely Financial, Inc. is an independent financial planning and investment management firm that provides clarity, insight, and guidance to help our clients attain their financial goals. Engage with the entire Blakely Financial team at WWW.BLAKELYFINANCIAL.COM to see what other financial tips we can provide towards your financial well-being.

Commonwealth Financial Network® or Blakely Financial does not provide legal or tax advice. You should consult a legal or tax professional regarding your individual situation.

Downsizing or Rightsizing: Finding the Right Fit for Your Future

Posted on July 8, 2024 by Steve LaFrance

If you’re thinking about downsizing or rightsizing your home prior to retirement, you’re not alone. This decision is not just about reducing space – it’s a significant financial decision that can benefit your lifestyle and financial health and many people are choosing to adjust their living spaces as they approach this new chapter in their lives. Learn more about the process of downsizing or rightsizing and how it can help you as you approach retirement.

Assessing Your Living Space

As homeowners age and children begin to move out, it’s common for individuals to assess their homes, finding that they primarily live in just three rooms: the family room, the bedroom, and the kitchen. Housing expenses can constitute a significant portion of a person’s budget in retirement. Naturally, many look to reduce their home size as a way to cut these expenses. However, it’s important to remember that reducing the size of your home doesn’t always equate to reducing your budget.

Financial Planning: Pre- and Post-Downsizing

Before taking the leap to downsize, it’s crucial to complete both a pre-downsizing budget and a post-downsizing budget with your financial advisor. This will give you a clear picture of your financial situation and help you understand the potential impact on your finances. Additionally, when selling your home, be aware of the potential capital gains tax implications. Fortunately, couples can exclude up to $500,000 of capital gains from the sale of their primary residence. You might also reinvest what you owe into a new permanent home.

Personal Considerations

While the financial benefits of downsizing are important, they are not the only factors to consider. Many people also think about the proximity to family, a warmer climate, or being closer to friends, all of which can significantly influence your decision. It is also essential to recognize that downsizing your home can impact your estate planning goal, retirement goals, and other financial situations in your life. Sit down with your financial advisor to see how downsizing would impact all areas of your financial plan before making a final decision.

Consulting with Trusted Advisors

At Blakely Financial, we suggest contacting your most trusted advisors to discuss this important decision. They can provide you with clarity, insight, and guidance tailored to your unique situation. Everyone’s circumstances are different, and having the best information possible is key to making an informed choice.

Downsizing or rightsizing your home is a significant decision that can shape your future in many different ways. By considering all factors and seeking professional advice, you can make a choice that supports your financial well-being and personal happiness. Still on the fence? Contact Blakely Financial today to get started.

Blakely Financial, Inc. is an independent financial planning and investment management firm that provides clarity, insight, and guidance to help our clients attain their financial goals. Engage with the entire Blakely Financial team at WWW.BLAKELYFINANCIAL.COM to see what other financial tips we can provide towards your financial well-being.

Commonwealth Financial Network® or Blakely Financial does not provide legal or tax advice. You should consult a legal or tax professional regarding your individual situation.

Financial Freedom for Women

Posted on July 8, 2024 by Emily Promise

Achieving financial freedom is a goal for many, but for women, it often comes with unique challenges. From wage gaps and career breaks to planning for longer life expectancies, women face distinct hurdles in their financial journeys. However, with the right knowledge, these obstacles can be overcome. In this blog, learn how to build wealth, take control of your financial future, and thrive in the financial world.

Understanding the Unique Challenges

The first step in gaining financial freedom as a woman is to understand the unique challenges you may face in the financial world. Here are a few you may come across:

Wage Gaps: Women often face wage disparities across various sectors and industries, which can significantly impact their long-term financial health.

Career Breaks Many women take career breaks for caregiving, which can impact their earning potential and career growth.

Longer Life Expectancies: Women typically live longer than men, which means it is crucial to plan for extra years of retirement.

Combating Challenges

While these challenges are very common among women, they can also be overcome. To combat wage gaps, women should be educated about industry salary standards and negotiation skills to ensure they are fairly compensated for their work. Additionally, supporting women’s access to leadership training and mentorship can help them reach higher-paying positions and close the wage gap.

Women can mitigate the financial impact of career breaks by engaging in proactive financial planning, such as saving specifically for this purpose. When speaking with your financial advisor, let them know this is part of your plan and they will help you factor it into your financial game plan.

When taking longer life expectancies into consideration, women should focus on extending their retirement planning to ensure they save enough to cover these additional years. Investing in robust healthcare plans and health savings accounts can address the rising medical costs associated with aging.

Essential Financial Strategies

When embarking on your journey toward financial independence, there are a few essential financial strategies to keep in mind:

Investing Early: Starting your investment journey early maximizes the benefit of compounding interest, which is crucial for building long-term wealth. Even small investments can accumulate significantly over time, helping women secure their financial future.

Diversified Portfolio: A mix of assets can manage risks and promote steady growth, safeguarding wealth against unpredictable market conditions. A diverse portfolio may include stocks across different industries and risk profiles, as well as other assets such as bonds and real estate.

Retirement Planning: Retirement planning is particularly important for women due to longer life expectancies and unique career trajectories. Effective strategies include maximizing 401(k) contributions and selecting suitable retirement accounts to ensure financial stability in later years. Be sure to research your employer’s retirement plan options and work with your financial advisor to select the one that best fits your unique situation and needs.

Learn and Grow

The journey to financial freedom is ongoing, requiring continuous learning, growth, and support. The following are key to a successful financial future:

Education & Awareness: Understanding the financial landscape is crucial for achieving financial independence. By educating yourself through workshops, webinars, and resources, you can become more aware and better prepared for any situation coming your way. Additionally, learning negotiation skills can help you secure better salaries and benefits, which is essential for building long-term wealth.

Strategic Planning: Strategic financial planning is essential for reaching financial independence. For example, having a plan that accounts for career interruptions by saving for sabbaticals or considering career break insurance can help create a solid path toward financial stability and independence.

Support and Community: Building a strong support system is crucial for women’s financial success. Engaging in mentorship programs for guidance and joining networks with other women facing similar financial challenges can provide valuable support.

With determination and the proper resources, women can confidently navigate their financial paths and achieve lasting financial security. If you want to learn how to gain financial independence, contact us today. We’re here to guide you every step of the way.

Blakely Financial, Inc. is an independent financial planning and investment management firm that provides clarity, insight, and guidance to help our clients attain their financial goals. Engage with the entire Blakely Financial team at WWW.BLAKELYFINANCIAL.COM to see what other financial tips we can provide towards your financial well-being.

Commonwealth Financial Network® or Blakely Financial does not provide legal or tax advice. You should consult a legal or tax professional regarding your individual situation.

Retirement Planning for Dads at Every Stage

Posted on June 10, 2024 by Emily Promise

Retirement planning is a journey spanning the entirety of your career, evolving as you move through different phases of your life. For dads, this process holds unique significance – not only are you securing your own future, but you’re also safeguarding your family’s long-term financial well-being. From the early days of your career to the time you decide to retire, every stage of your journey offers opportunities to optimize your retirement planning strategy. As Father’s Day approaches, let’s explore retirement planning for dads and what this may look like at each career stage, ensuring a smooth transition to a financially secure retirement for you and your family.

Early Career (20s to Early 30s)

In the early stages of your career, when you are in your 20s to early 30s, time is your greatest ally. To build a strong foundation in your retirement planning, you will want to begin contributing to your retirement accounts as soon as possible. Research any retirement accounts offered by your employer and be sure to enroll in one, such as an employer’s 401(k) plan. Once enrolled, strive to contribute enough to qualify for the full employer match, if it is available, as it essentially offers free money towards your retirement savings. Simultaneously, it’s essential to establish an emergency fund, which serves as a financial buffer during unexpected situations and emergencies. Aim to have three to six months’ worth of expenses saved in this account to avoid dipping into your retirement savings and preserve future compounding gains in case of emergency.

Mid-Career (Mid-30s to 40s)

As you progress into your mid-career in your mid-30s to 40s, your earning power typically increases, making it the perfect time to ramp up your retirement contributions! Strive to max out your 401(k) contributions and consider opening an IRA for additional tax-advantaged savings. Additionally, it is critical to start diversifying your investment portfolio beyond standard retirement accounts. Other assets may include real estate, stocks, and more. Talk to your financial advisor to see which options are best for you and your risk tolerance. Moreover, while it is tempting to focus solely on saving for your children’s education during these years, it is important to maintain a balance between funding their college accounts and boosting your retirement savings.

Late Career (50s to Early 60s)

When you reach your 50s to early 60s and retirement begins to inch closer, take full advantage of catch-up contributions in your 401(k) and IRA, which allow you to contribute additional funds if you are over 50. It is also important to reevaluate your retirement goals once you reach this stage. Ask yourself, “Am I on track to live comfortably?” and adjust your savings strategies accordingly. Additionally, focus on reducing or eliminating any outstanding debt including your mortgage, credit cards, and personal loans before retirement. Entering your retirement debt-free can significantly reduce your monthly expenses as well as financial stress.

Nearing Retirement (Late 60s and beyond)

In the years closest to retirement, develop a strategic plan for withdrawing from your retirement savings accounts to maximize your gains and minimize taxes. Speak with your financial advisor to learn more about tax-saving strategies and the best approach for you and your unique situation. In addition, consider any necessary lifestyle changes such as downsizing your home for cost efficiency, and begin to plan for healthcare needs. Understand your Medicare options and assess the need for supplemental policies or long-term care insurance, ensuring you are covered for any health issues that may arise during retirement.

As you navigate the joys of fatherhood, remember it’s also crucial to plan for your future. At Blakely Financial, we’re dedicated to helping dads at every stage of fatherhood work toward a comfortable retirement. From your first Father’s Day to enjoying your golden years, let’s make sure your financial plans are as strong as the legacy you’re building. Contact us today to get started.

Blakely Financial, Inc. is an independent financial planning and investment management firm that provides clarity, insight, and guidance to help our clients attain their financial goals. Engage with the entire Blakely Financial team at WWW.BLAKELYFINANCIAL.COM to see what other financial tips we can provide towards your financial well-being.

Commonwealth Financial Network® or Blakely Financial does not provide legal or tax advice. You should consult a legal or tax professional regarding your individual situation.

The Benefits of Investing in a Second Home

Posted on June 10, 2024June 10, 2024 by Robert Blakely

Owning a second home is not just about having a getaway spot – it’s a strategic investment offering multiple financial and personal benefits. Whether it’s a beachfront condo, a mountain cabin, or a house in a serene village, we’re exploring the multifaceted benefits of investing in a second home.

Investment Potential

Investing in a second home can be a smart financial move. Many properties, especially those in sought-after vacation destinations not only hold their value but also appreciate over time. This appreciation paired with choosing the right location and maintaining the property well can turn your second property into an increasingly valuable asset in your long-term investment strategy as years pass.

Rental Income

One of the most appealing aspects of owning a second home is the opportunity to generate income through rentals. When you are not using the property, you can rent it out to travelers or even long-term tenants. This rental income can help cover the cost of the mortgage, necessary maintenance, and property taxes, allowing you to own and maintain this additional property with minimal personal expense. If your vacation home is in a popular destination, it can command high rental prices, especially during peak tourist seasons, and provide you with substantial supplemental income.

Tax Deductions

Second homes can also offer tax advantages. As the property owner you have the potential to enjoy tax deductions on mortgage interest and property taxes, much like with your primary residence. These tax benefits can help make owning a second home more affordable while also easing your overall tax burden. It is important to speak with a tax professional to fully understand and maximize these benefits based on your own unique financial situation and both local and national tax laws.

Diversified Assets

Diversifying your investment portfolio is a fundamental strategy used to mitigate risk, and real estate plays a vital role in this diversification. Investing in different types of properties in various locations allows you to reduce the risks associated with market fluctuations in any single investment area. A second home adds a tangible asset to your portfolio, which is often less volatile when compared to stocks and other financial investments.

Customizable Vacations and Family Gatherings

Aside from the financial benefits, a second home provides a personal retreat tailored to your preferences. It eliminates the hassle of booking hotels or dealing with the uncertainties of vacation rentals and other accommodations. More importantly, it serves as a consistent gathering place for family and friends, helping to build cherished memories in a familiar setting. Owning a second home ultimately means customizable vacations where the only thing you need to plan is how to enjoy your time!

Retirement Preparation

For many, a second home is not just used as a spot to vacation or retreat but also as a potential retirement destination. When purchasing a second home during your working years you can also transition it into your ideal retirement residence. This approach allows you to become acclimated to the community and area you wish to retire in and gives you the advantage of planning ahead for the lifestyle you wish to live in retirement.

Second homes present a unique blend of investment opportunity and personal sanctuary. Contact Blakely Financial today to see how a second home can enhance your financial plan!

Blakely Financial, Inc. is an independent financial planning and investment management firm that provides clarity, insight, and guidance to help our clients attain their financial goals. Engage with the entire Blakely Financial team at WWW.BLAKELYFINANCIAL.COM to see what other financial tips we can provide towards your financial well-being.

Commonwealth Financial Network® or Blakely Financial does not provide legal or tax advice. You should consult a legal or tax professional regarding your individual situation.

529 Plans: Rethinking the Possibilities

Posted on May 10, 2024 by Steve LaFrance

529 plans are no longer solely reserved for college tuition. Today, these versatile accounts offer a broader spectrum of possibilities beyond saving for college, covering expenses like vocational schools and K-12 education. With their tax advantages and adaptability to diverse educational paths, 529 plans emerge as a strategic solution for families seeking flexibility and foresight in securing their children’s educational future. In this blog, we are rethinking the possibilities of 529 plans to explore their full potential and delving into how you can leverage these accounts to invest in your child’s future at every stage of their education journey.

529 Plans for College Tuition

Traditionally, 529 plans have been used to save for college tuition and related expenses. These accounts offer tax-deferred growth and tax-free withdrawals when funds are used for qualified higher education expenses. By contributing to a 529 plan, parents can build a dedicated fund to cover the cost of tuition, room and board, books, and other college-related expenses. Anyone can contribute to 529 plans, allowing family and friends to contribute to your child’s future education.

K-12 Tuition

In recent years, the scope of 529 plans has expanded to include K-12 education expenses. Families can now use a 529 plan to pay for up to $10,000 in tuition at elementary, middle, and high schools, including private and religious institutions. This flexibility allows parents to start saving for their child’s education from an early age and provides additional options for educational choices beyond the traditional public school system.

Vocational Schools

Another exciting development in the possibilities of 529 plans is the ability to use funds for vocational schools and career training programs. If your child is interested in pursuing a trade or obtaining specialized certifications, a 529 plan can help cover the cost of tuition, fees, and supplies. This opens up new opportunities for students who may not have considered traditional four-year college programs, allowing them to pursue career paths aligned with their interests and goals. Eligible vocational schools, including many technical colleges, cosmetology schools, culinary schools, and more can be found using the Federal School Code Lookup Tool.

Apprenticeship Programs

529 plans can also be used to support apprenticeship programs that are certified and registered with the U.S. Department of Labor’s National Apprenticeships Act, providing financial assistance for on-the-job training and educational coursework. Apprenticeships offer a valuable alternative to traditional education pathways, allowing individuals to earn, while they learn and gain practical skills in a specific trade or industry. By using funds from a 529 plan, apprentices can offset the cost of program fees, books, supplies, equipment, and other related expenses, making these opportunities more accessible to aspiring professionals. The Department of Labor provides a search tool to determine whether your apprenticeship is eligible for 529 plan funds.

As 529 Day approaches, it’s time to rethink the possibilities of 529 plans and explore the various ways you can use them to invest in your child’s education journey. Contact the Blakely Financial office today to learn how we can help you maximize the benefits of 529 plans and support your child’s goals every step of the way.

The fees, expenses, and features of 529 plans can vary from state to state. 529 plans involve investment risk, including the possible loss of funds. There is no guarantee that an education-funding goal will be met. In order to be federally tax free, earnings must be used to pay for qualified education expenses. The earnings portion of a nonqualified withdrawal will be subject to ordinary income tax at the recipient’s marginal rate and subject to a 10 percent penalty. By investing in a plan outside your state of residence, you may lose any state tax benefits. 529 plans are subject to enrollment, maintenance, and administration/management fees and expenses.

Blakely Financial, Inc. is an independent financial planning and investment management firm that provides clarity, insight, and guidance to help our clients attain their financial goals. Engage with the entire Blakely Financial team at WWW.BLAKELYFINANCIAL.COM to see what other financial tips we can provide towards your financial well-being.

Commonwealth Financial Network® or Blakely Financial does not provide legal or tax advice. You should consult a legal or tax professional regarding your individual situation.

Quiz: How Financially Literate Are You?

Posted on April 9, 2024April 9, 2024 by Emily Promise

As we recognize Financial Literacy Month, we must assess our knowledge and understanding of key financial concepts that impact our daily lives such as budgeting, investing, borrowing, and more. Whether you’re a seasoned investor or just beginning your financial journey, this quiz offers an opportunity to reflect on your financial knowledge and take steps toward improving your financial literacy. Are you ready to see where you stand? Dive into our Financial Literacy Month quiz and put your knowledge to the test!

What is the effect of compound interest on an investment over time?

Decreases the total amount of interest earned
Increases the total amount of interest earned by adding interest to the principal and accumulated interest
Has no effect on the total amount of interest earned
Only applies to savings accounts

Correct Answer: 2

Compound interest allows you to earn interest not only on the initial principal amount invested but also on the accumulated interest from previous periods. Over time, this compounding effect results in the exponential growth of your investment, significantly increasing the total amount of interest earned.

Why is diversification important in an investment portfolio?

It guarantees a fixed return on investment
It reduces risk by spreading investments across various asset classes
It focuses investment in one sector to maximize returns
It ensures all investments will profit

Correct Answer: 2

The process of diversification involves spreading your investments across different asset classes to minimize risk. These may include stocks, bonds, and real estate. By diversifying your investment portfolio, you can mitigate the impact of adverse events affecting any single asset or sector. This will help stabilize returns and potentially improve long-term performance. If you’re struggling to diversify your investments, meet with your financial advisor to discuss your options.

Which of the following accounts offers tax-deferred growth?

Checking account
Certificate of Deposit (CD)
401(k) or Traditional IRA
Brokerage Account

Correct Answer: 3

Tax-deferred growth refers to the ability of investments to grow without being taxed until withdrawal. Both 401(k) plans and Traditional IRAs offer tax-deferred growth, allowing your investments to compound over time without being subject to immediate taxation on earnings. Everyone’s financial situation is unique, so be sure to talk to your financial advisor to be sure you are taking advantage of the best plans and accounts for you.

What is a “bull market”?

A market characterized by declining stock prices
A market in which stock prices are remaining stable
A market characterized by rising stock prices
A market that exclusively trades in agricultural stocks

Correct Answer: 3

A bull market is a period characterized by rising stock prices and investor optimism. During a bull market, investor confidence is high, leading to increased buying activity and upward momentum in stock prices across the market.

What does a fixed-rate mortgage offer that a variable-rate mortgage does not?

A mortgage rate that changes with the market
Lower interest rates over the life of the loan
The same interest rate and monthly payment throughout the life of the loan
Higher borrowing limits

Correct Answer: 3

A fixed-rate mortgage offers borrowers the security of a consistent, or fixed, interest rate and monthly payment throughout the life of the loan. In contrast, a variable-rate mortgage will have interest rates that fluctuate with market conditions, resulting in varying monthly payments and potentially higher levels of financial uncertainty for borrowers. Talk to your financial advisor to sort out which option is best for you and your financial health.

Whether you aced every question and passed with flying colors or found new areas to explore, taking the time to assess your financial literacy is a valuable step toward financial empowerment. Remember, financial literacy is an ongoing journey, and there’s always room to learn and grow.

If you found any questions throughout the quiz challenging or would like to delve deeper into any topics, contact the Blakely Financial team today. We are ready to help you navigate your financial journey with confidence! For additional resources and insights designed to boost your financial understanding, check out the Blakely Financial website.

Blakely Financial, Inc. is an independent financial planning and investment management firm that provides clarity, insight, and guidance to help our clients attain their financial goals. Engage with the entire Blakely Financial team at WWW.BLAKELYFINANCIAL.COM to see what other financial tips we can provide towards your financial well-being.

Commonwealth Financial Network® or Blakely Financial does not provide legal or tax advice. You should consult a legal or tax professional regarding your individual situation.

Financial Literacy Month: Our Favorite Podcasts

Posted on April 2, 2024April 9, 2024 by Robert Blakely

April is Financial Literacy Month, a time dedicated to empowering everyone with the knowledge necessary to make informed and effective financial decisions. There are many ways to improve your financial literacy, and we are thrilled to share some of our favorite resources to boost your financial wisdom. As a listener of the following podcasts, you’ll gain valuable insights from experts, hear real-life stories, and listen in on thought-provoking discussions on a wide range of financial topics.

Planet Money

Our first highlight is Planet Money, a podcast by NPR that makes economics fun, understandable, and relevant. The podcast can take any topic and relate it back to the economy, helping you understand both the economy and the world as a whole.

Episodes are typically around 30 minutes or less. Here are some recent examples of episodes we’ve enjoyed:

Planet Money can be found anywhere you listen to your podcasts!

BiggerPockets

Dive into the world of finance, entrepreneurship, and real estate with our next podcast pick: BiggerPockets. Whether you’re a seasoned investor or just getting started, BiggerPockets offers invaluable insights to help you build your wealth and navigate the complexities of real estate investment.

Most episodes are less than 1 hour long. Here are some recent episodes we enjoyed:

BiggerPockets is available anywhere you listen to your podcasts!

Bloomberg’s Masters in Business

Our next feature is Bloomberg’s Masters in Business. This podcast brings the insights of the world’s leading business minds right to your ears. Delve into deep conversations with industry pioneers in finance, economics, and beyond. Discover the strategies and stories behind successful business ventures, elevating your understanding and inspiring you with every episode.

Episodes vary in length, ranging from just 5 minutes to over an hour long. Here are some episodes we’ve enjoyed recently:

Masters in Business is available wherever you listen to podcasts!

Exploring podcasts during Financial Literacy Month offers an engaging and accessible way to expand your financial knowledge and empower yourself to make informed decisions about your finances. Whether you’re looking to improve your budgeting skills, learn about investing, or gain a deeper understanding of economic concepts, these podcasts provide valuable resources to help you navigate your financial journey with confidence. Grab your headphones and start listening – your healthy financial future awaits!

For more personalized advice and insights, contact the Blakley Financial team today. Our advisors are available and ready to assist you in your journey toward strong financial literacy and well-being.

Blakely Financial, Inc. is an independent financial planning and investment management firm that provides clarity, insight, and guidance to help our clients attain their financial goals. Engage with the entire Blakely Financial team at WWW.BLAKELYFINANCIAL.COM to see what other financial tips we can provide towards your financial well-being.

Commonwealth Financial Network® or Blakely Financial does not provide legal or tax advice. You should consult a legal or tax professional regarding your individual situation.