financial planning Archives - Blakely Financial

The Pinwheel of Financial Wellness

Posted on January 14, 2025 by Emily Promise

January is Financial Wellness Month and the start of a new year – the perfect time to focus on and evaluate your financial health. Our pinwheel highlights the key areas we cover to create a comprehensive plan for every client at Blakely Financial. From investing to retirement and beyond, we make sure every piece of your financial wellness is in place.

Budget Planning

When creating a comprehensive financial plan, it is important to begin by discussing your goals. Are you saving for college? Preparing for retirement? Looking to purchase a second home, or maybe remodel your kitchen? There is no one-size-fits-all plan for your finances!

Based on your goals, your financial advisor will help you create a budget to provide the confidence and clarity you need to relax and enjoy your years ahead while working towards your goals. They will work with you every step of the way to manage your estate, prepare your finances to support the people you care about most, and strengthen your financial legacy.

Employer-Sponsored Retirement Plan

Take full advantage of any retirement plans offered by your employer. Some plan options may include 401(k)s, Roth IRAs, SEPs, and more. When choosing the right employer-sponsored plan for you, there are several elements to consider:

Does your employer offer a contribution match? If so, are you leveraging it properly?
How far away from retirement are you?
Are you saving enough to maintain your lifestyle during retirement?

It is important to fully understand all of your retirement plan options to maximize your savings. Sit down with your financial advisor to decide which option is best for you and your unique financial situation.

Life Insurance

No matter your current stage in life, the best thing you can do for yourself and your loved ones is to be prepared for anything life throws at you. Your financial advisor is here to help you prepare for the unexpected. They will help you create a comprehensive plan including life insurance options specific to your overall needs to protect your family’s financial future.

Education & College Planning

Do you lay awake at night worrying about the cost of your children’s education? You are not alone! Planning college funds and paying for private schools can be intimidating. Meeting with a financial advisor can help you get started with a strong financial plan factoring in education and college planning, so you can sleep more soundly. By starting early, you can take advantage of tax-advantaged savings options like 529 plans, which grow over time to help offset rising tuition costs.

Estate Planning

Spending time now to properly plan for the future can provide financial security for your family and alleviate any stress you may have about the distribution of your assets. Although discussing end-of-life arrangements is not always comfortable, estate planning is essential to a sound financial plan. Working with your financial advisor along with an estate attorney can help you plan and preserve the legacy you have worked so hard to build. By incorporating strategies such as truss or gifting, you can ensure your assets are passed on efficiently and according to your wishes.

Tax Planning

Properly planning your taxes is a major aspect of your financial wellness. This means taking advantage of all available deductions, optimizing your contributions, and more. Start thinking about what can be done now to save yourself from stress later on. Keep track of dates for your deductions, contributions, and donations. Consult a tax professional for guidance on your specific tax situation and for policies and regulations that may pertain to you.

Health Care

As we age, the cost of health care rises significantly, making it essential to factor into your financial wellness and comprehensive financial planning. Consider expenses like premiums, out-of-pocket costs, and long-term care. Additionally, you may want to consider opening a Health Savings Account(HSA) if eligible, as it offers tax advantages and can be used to cover medical expenses in retirement. A trusted financial advisor can walk you through your options to help you allocate your funds wisely and ensure you and your family’s healthcare needs are covered without compromising your financial goals.

Long-Term Care

Setting funds aside for long-term care in old age is often overlooked, but it is an integral part of any well-rounded financial plan. Long-term care insurance may be a practical solution to funding care needs, whether for at-home care or a nursing home, providing peace of mind for you and your loved ones. This type of insurance can also be a vital part of your estate planning, talk to your financial advisor to evaluate your options and ensure you are prepared.

Social Security Optimization

Are you making the most of your social security benefits? To optimize your benefits you may want to consider:

Delaying claiming past full retirement age for higher payments
Coordinating spousal benefits strategically
Planning for potential benefit taxes based on your income

If you receive social security benefits, you can expect them to increase by 2.5% due to a cost-of-living adjustment in 2025. Limits for taxable earnings and income thresholds can also change year-to-year, so be sure to sit down with your advisor to see how these changes impact you and your finances.

Retirement Income

Planning your retirement income is essential to ensuring your savings last throughout your golden years. An experienced financial advisor can help you develop a strategy to maximize income, minimize taxes, and meet your goals. Key considerations include creating a withdrawal strategy, managing Required Minimum Distributions (RMDs), factoring in inflation, and diversifying income streams. By regularly reviewing your spending patterns and income strategy, you can enjoy a fulfilling retirement with confidence!

A sound financial plan should include all of these aspects to ensure your long-term financial security. No matter your goals, you have a team behind you at Blakely Financial. Take the first step toward your financial wellness journey and contact us today!

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.

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.

Choosing Your Power of Attorney

Posted on January 14, 2025 by Robert Blakely

When it comes to financial and estate planning, choosing a Power of Attorney (POA) is one of the most important decisions you will make. This person is designated to act on your behalf in legal, financial, or healthcare matters if you’re unable to make decisions yourself, and selecting the right person for this role ensures that your wishes are carried out effectively and responsibly. At Blakely Financial, we know this decision can feel overwhelming. To help guide you, we’ve outlined key considerations and questions to ask when choosing your Power of Attorney.

What is a Power of Attorney?

A Power of Attorney is a legal document granting someone you trust the authority to make decisions on your behalf. POAs can serve a variety of purposes, from managing your financial accounts to making critical decisions regarding healthcare. There are different types of POAs, including:

Durable Power of Attorney, which remains in effect even if you become incapacitated.
Limited Power of Attorney, which grants authority for specific tasks or a limited time frame.
Healthcare Power of Attorney, which allows someone to make medical decisions for you.

Choosing the right person for this role is critical to ensuring your financial goals and personal wishes are respected.

Key Questions to Consider

Do they understand your financial goals?

It is important to choose someone who understands both your short and long-term financial goals. Whether it is saving for retirement, contributing to a charitable cause, or protecting your legacy, your POA should have a clear understanding of what is important to you, so their decisions align with your priorities.

Are they trustworthy and dependable?

Trustworthiness is a non-negotiable quality when choosing your Power of Attorney. This individual will have access to sensitive financial accounts and personal information as well as the ability to make significant decisions on your behalf. You need to choose someone who will act with integrity and in your best interest at all times.

Will they act in your best interests?

A strong POA must prioritize your needs above all else, even in tough or emotionally charged situations. For example, they may need to make difficult financial decisions during a family disagreement or resist external pressures that conflict with your goals.

Are they comfortable making tough decisions under pressure?

Your POA must have the emotional resilience to handle stressful situations and the ability to think critically in these stressful times. This is especially important in moments of crisis, such as medical emergencies or legal disputes, where they need to make clear, well-thought-out decisions in your best interest.

Do they live nearby or have the availability to step in quickly if needed?

Proximity and availability matter, especially in situations where immediate decisions are required. While a POA does not necessarily need to live in the same city, they should have the time and flexibility to act quickly when necessary. If your POA does live far away, frequent communication and travel availability should be considered.

Do they have the financial knowledge or willingness to seek professional advice when needed?

Your POA doesn’t need to be a financial expert, but they should have a basic understanding of finances or the willingness to consult professionals like financial advisors or estate attorneys to ensure informed and responsible decision-making.

Will they communicate effectively with family members or other advisors involved in your plan?

Your POA may need to collaborate with family members, healthcare providers, or financial professionals to carry out your wishes. Strong, diplomatic communication skills are essential to avoid misunderstandings and conflicts.

Other Considerations When Choosing Your Power of Attorney

In addition to choosing a primary Power of Attorney, it is wise to name an alternate in case your first choice is unable or unwilling to fulfill their responsibilities. This provides an added layer of security for your plan.

Remember, your POA designation must be formalized through a legal document for it to take effect. Working with both a financial advisor and an estate attorney helps ensure your plan is comprehensive and aligned with your goals.

Choosing your Power of Attorney is one of the most important decisions you’ll make when planning for the future. By considering these questions and working with a trusted advisor, you can feel confident in choosing a POA who will act in your best interest and uphold your wishes. For guidance on this or any other aspect of your financial plan, contact the Blakely Financial team today. We’re here to help you navigate every step of your financial journey.

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.

Year in Review: Financial News

Posted on December 12, 2024 by Emily Promise

As 2024 draws to a close, it is the perfect time to reflect on the year’s financial news and developments that have influenced individuals, businesses, and markets alike. From tax adjustments to changes in policies and trends, these key financial updates have posed both challenges and opportunities throughout the last year.

Tax Updates

2024 saw significant adjustments in tax laws, providing new opportunities for individuals and families to save. Here are a few:

Higher Standard Deduction: For 2024, the standard deduction increased to $29,200 for married couples filing jointly, $14,600 for single taxpayers and married individuals filing separately, and $21,900 for heads of household.
EV Tax Credits Enhanced: Buyers of qualifying electric vehicles (EVs) now have the option to transfer the federal $7,500 EV tax credit to the dealer at the time of purchase, lowering the upfront cost of the car. This simplifies the process for buyers and incentivizes eco-friendly choices!
Retirement Contributions: Contribution limits for IRAs and workplace retirement accounts increased again in 2024. Individuals can now contribute up to $7,000 to traditional and Roth IRAs, with an additional $1,000 catch-up contribution for those over 50. The contribution cap for 401(k)s increased to $23,000, with an additional $7,500 for catch-up contributions.

Medicare Costs Rise

Medicare Part B premiums saw a 6% increase in 2024, rising to $174.70 per month and reversing the prior year’s decrease. Additionally, the deductible for Part B increased from $226 to $240. While some Medicare Advantage and Part D plans experienced slight adjustments, the changes highlight ongoing concerns about the affordability of healthcare.

Retirement Policy Shifts

Retirement planning experienced several notable changes including:

Required Minimum Distributions (RMDs): As part of the SECURE 2.0 Act, the age to begin RMDs remained at 73 for 2024.
HSA Contribution Limits: Health Savings Account (HSA) contribution limits reached record highs in 2024, with individuals able to contribute up to $4,150 and families up to $8,300, reflecting the growing importance of HSAs in healthcare and retirement planning.

Inflation and Interest Rates

Inflation rates in 2024 remained more stable compared to the highs of 2022 and 2023. However, the Federal Reserve maintained its cautious stance by keeping interest rates elevated, aiming to curb any lingering inflationary pressures while ensuring economic growth. This policy reinforced the need for strategic financial planning with many borrowing costs, including mortgages, auto loans, business investments, and more.

Real Estate Market Dynamics

Throughout 2024, the real estate market remained challenging due to the high interest rates. Homebuyers faced affordability issues as mortgage rates stayed above 7% for much of the year, leading to slower home sales and increased demand for rental properties. Sellers in competitive markets still benefitted, but many opted to wait for rates to drop before listing their homes.

It’s critical to stay informed and proactive when it comes to policy updates and your finances. At Blakely Financial, we are here to help you navigate these changes and plan for a healthy financial future. If you have questions or need guidance on how these 2024 financial updates may impact your goals, contact us today.

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.

Securing Your Legacy: Questions to Guide Your Family Business Succession and Transition

Posted on December 12, 2024 by Steve LaFrance

Family businesses are built on hard work, shared values, and a vision for the future, and therefore, planning for family business succession can be challenging. Succession planning involves more than just passing the baton – it is often a complex and emotional process addressing family dynamics, aligning on a long-term vision, and making strategic decisions to protect the business’s success and your family’s legacy. Thoughtfully addressing critical questions can help ensure a smooth transition and safeguard what you and your family have worked so hard to build. Here are five key questions to help guide your family through this process:

What are the history, values, and objectives of our family?

The first step in successful succession planning is to take a step back and reflect on the history, values, and objectives that have shaped your family business. Understanding these elements of your business’s core identity ensures future decisions and leadership transitions remain consistent with your family’s legacy and mission.

To address this question, hold discussions with family members to revisit the story of your business’s founding and the values that have guided it through the years. Identify shared goals for the future such as growth, community impact, or preserving family leadership. Aligning on these factors ensures continuity, keeps the business grounded in its identity through transitions, and provides clarity for future leaders.

Is the best solution to divide the business to avoid conflict?

Conflict is one of the biggest threats to family business continuity. For some families, dividing the business among heirs may seem like the simplest solution to prevent disputes, but it is not always the best option. Splitting the business can dilute its operational and financial strength, making it harder to compete and thrive in the long run.

This decision requires careful consideration. Evaluate whether dividing the business is financially and operationally viable and consider the implications for brand identity, customer relationships, and overall profitability. Openly discuss these potential risks and benefits with family members and trusted advisors. Proactively addressing the possibility of division ensures all family members understand the implications and helps reduce the risk of misunderstandings or conflict later on.

What role should a board of directors play?

A board of directors can serve as a stabilizing force during and after a leadership transition. Whether the board consists of family members, external advisors, or a combination of both, it can help provide structure, accountability, and impartial guidance. The professionalism and skill a board brings to the decision-making process are crucial to reducing the risk of emotionally driven choices.

Define the board’s composition, role, and authority, and consider whether it will include independent directors who bring valuable industry knowledge and an unbiased perspective. Additionally, set clear guidelines for how the board will operate and support the transition process. A well-structured board can mediate conflicts, support decision-making, and keep the business focused on its long-term objectives.

Should multiple siblings and/or cousins take over the business together?

When multiple family members inherit leadership roles in the family business, it can lead to collaboration – or conflict. The keys to avoiding power struggles are clear communication and expectations. Without defined roles and responsibilities, transitioning to joint leadership can lead to confusion, inefficiency, and disputes jeopardizing both the business and family relationships.

Evaluate each individual leader’s skills, interests, and commitment to the business. Based on this evaluation, clearly define roles, responsibilities, and decision-making processes. You may even want to consider implementing leadership development programs to prepare the next generation for their roles. Establishing a framework for co-leadership will help ensure a smoother transition, accountability, and minimal risk of misunderstandings or conflicts.

Is everyone aligned on the long-term vision for the business?

Regardless of the type of business, ensuring all stakeholders share a common vision is critical to maintaining cohesion and driving the organization forward after a transition. In a family business, every family member involved must share a unified vision for its future. Misalignment can create internal conflict and tension and derail plans for growth or stability.

Facilitate honest and open discussions among family members about long-term goals, including strategies for growth, expansion, diversification, modernization, and maintaining a steady focus on the core business. Be sure to incorporate the perspectives of younger generations, as their insights can help drive the innovation and modernization necessary for success. Coming together with a unified vision fosters cohesion, builds trust, and ensures all stakeholders are working toward the same goal to preserve the business’s longevity.

Planning for family business succession is no small task – it’s a process requiring thoughtful consideration and honest communication. Every family business is unique, and working with experienced advisors who understand both the financial and emotional aspects of succession can make all the difference. The Blakely Financial team is ready to guide you and your family through this important journey, helping you secure your legacy and protect your family’s hard-earned success. Contact us today to get your planning 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.

Tax Benefits of Charitable Giving

Posted on November 6, 2024November 8, 2024 by Robert Blakely

Charitable giving can make a powerful, positive impact. When planned strategically, charitable donations can not only benefit the causes you care about but also offer significant tax benefits such as deductions and other incentives to reduce your taxable income. In this blog, we’re exploring the various tax benefits of charitable giving to help you make informed decisions that support both your community and your financial future.

Charitable Contribution Deductions

As a donor, if you choose to itemize deductions on your tax return rather than take the standard deduction, you can deduct contributions made to qualified charitable organizations. These can include cash donations, property, or other assets donated to organizations like nonprofits, educational institutions, or religious groups. For cash donations, donors can generally deduct up to 60% of their adjusted gross income (AGI). For non-cash assets, such as real estate or personal property, the deductible amount may vary and may be capped at 30% of AGI, depending on the nature of the asset and the charity type.

Additionally, you may be able to make deductions for volunteering expenses. While volunteer time itself isn’t deductible, out-of-pocket expenses related to volunteer work may be. This can include travel, supplies, uniforms, and other costs directly associated with the charity, as long as they are necessary to the work being done.

It is also important to note that some states offer additional tax incentives or credits for charitable contributions, which can enhance federal tax savings. Talk to your financial advisor to learn more about your options to maximize your tax savings while giving back to your community.

Qualified Charitable Distributions (QCDs) and Donor Advised Funds (DAFs)

A QCD allows individuals who are 70 ½ years of age or older to make tax-free donations directly from their IRA to charity, with an annual limit of $100,000 per person. QCDs are counted toward the Required Minimum Distributions (RMDs) for the year, allowing you to reduce your IRA balance without increasing taxable income and triggering additional income tax. This is particularly beneficial for those who do not itemize deductions, as this tax benefit doesn’t require itemization.

DAFs are another tax-efficient way to manage charitable contributions. Contributing to a DAF allows you to receive an immediate tax deduction in one tax year and then decide which charities to support over several years. This flexibility is especially helpful for high-income years when you need a larger deduction or for folks who alternate between taking the standard deduction and itemizing in different years.

Donation of Appreciated Assets

Donating long-term appreciated assets, such as stocks, bonds, or real estate, allows the donor to avoid paying capital gains tax and still claim a charitable deduction.

When donating an asset held for over a year, the deduction amount is generally the fair market value of the asset at the time of donation. This benefits you as a donor significantly because you avoid the capital gains tax you would otherwise owe if you sold the asset, potentially increasing the tax savings associated with your charitable contribution.

Carryover of Excess Contributions

If your total charitable contributions exceed the allowable deduction limit for the year, you can carry over the excess and apply it to future tax years. Charitable contributions above the AGI limits can be carried forward for up to five years, allowing donors to maximize their deduction over time, spreading the tax benefits and potentially avoiding the need to limit annual giving.

Estate Tax Benefits

For high-net-worth individuals, charitable giving can also be a strategic part of estate planning, as it reduces the size of the taxable estate, thereby lowering estate tax obligations.

Donations made as part of an estate plan can lower the estate’s value, which is especially beneficial for estates that exceed the federal estate tax exemption amount. Additionally, charitable bequests can be deducted from the estate’s gross value, which may reduce the overall estate tax liability.

Our Favorite Charitable Organizations

Are you ready to make charitable contributions but unsure where to start? These are some of our team’s favorite organizations to support:

Rob and Yesy’s pick: United Way, developing community resources and partnerships that support a broad array of critical health and human service needs in our community
Steve’s pick: Kiwanis, improving the world one child and one community at a time.
Emily’s pick: SPUR North Shore, mobilizing volunteers in service and enrichment opportunities to support the needs of the North Shore Community.
Larry’s pick: Wings for Widows, providing free, professional coaching and education to help widowed men and women navigate the financial trauma experienced in widowhood.
Donna’s pick: Junior League of High Point, committed to promoting voluntarism and developing the potential of women in our community.
Cara’s pick: Community Servings, an organization providing medically tailored, nutritious, scratch-made meals to chronically and critically ill individuals and their families
Erin’s pick: Best Buddies, which serves individuals with intellectual and developmental disabilities (IDD) and their families.

To fully leverage the tax benefits of charitable giving, it is essential to fully understand the rules and regulations at hand. It is also recommended that you consult a financial advisor who can guide you in making tax-efficient donations. At Blakely Financial we are here to help you navigate these decisions so you can give with confidence, knowing your contributions are making a meaningful impact both for others and for your own financial future. 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.

Beware of the Financial Skeletons in Your Closet

Posted on October 8, 2024October 8, 2024 by Steve LaFrance

We all have financial habits or forgotten accounts hiding in the shadows, going unnoticed until they start causing trouble. These “financial skeletons” can slowly drain your wealth, create stress, and keep you from achieving your financial goals. At Blakely Financial, we’re here to remind you of these financial skeletons in your closet and help you uncover smarter ways to grow and maintain your wealth.

Stagnant Savings Accounts

Leaving your money in a stagnant savings account is like burying it in a cursed chest that only loses its shine. While your savings may feel secure, leaving your money in a low-interest account can slowly drain its value over time, thanks to inflation. Move your money to a more lucrative spot before inflation turns your savings into dust!

Savings accounts are valuable for short-term liquidity and emergency funds but to build long-term wealth, consider a diverse variety of investments including stocks, bonds, real estate, and more.

Underfunded Emergency Fund

An underfunded emergency fund is the financial boogeyman hiding under your bed. You may not see it, but you never know when a financial surprise will creep up—a medical emergency, car repair, or unexpected expense can strike at any moment. Without a well-funded emergency fund, you could find yourself scrambling to cover the cost, leaving your financial stability on shaky ground.

We recommend building an emergency fund with 3 to 6 months’ worth of expenses saved to provide peace of mind when life throws you a curveball. Create good saving habits by making consistent contributions to your fund and regularly monitoring your progress. Even small contributions will get you closer to financial security!

Neglected Retirement Accounts

Beware the dusty tombs of your forgotten retirement accounts! Left unchecked, these relics from the past can become financial traps full of hidden fees and poor investments. If you’ve hopped from job to job over the years, you may have left behind old 401(k)s or retirement accounts without a second thought. These forgotten accounts can quietly lose value with missed growth, hidden fees, or poor investment performance, leaving your future at risk. Don’t let your golden years turn into a financial nightmare – unearth those accounts and bring them back to life!

You have a few options for old employer retirement accounts including keeping them with your old employer’s plan, rolling your 401(k) over into an IRA or into your new employer’s plan, and cashing out. All options have benefits and disadvantages, so it is important to understand and weigh your options. Talking to your financial advisor can help you figure out which is best for you and your unique financial situation.

From high-yield savings accounts to strategic investments, we’ll make sure your money is working for you, not wasting away as financial skeletons in your closet. Contact the Blakely Financial team 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.

Your Financial Planning Roadmap

Posted on October 2, 2024October 4, 2024 by Emily Promise

World Financial Planning Day falls on October 2nd, making it a great time to evaluate your financial health. No matter where you are on your financial journey, having a solid financial planning roadmap is key to reaching your goals. From your 20s to your 50s and beyond, each phase of life comes with new financial stops and important decisions to be made. Explore the various phases of your financial planning roadmap and the actions you can take within each stage to secure your financial future.

Starting Out (20s – 30s)

The first phase of your financial planning roadmap covers your 20s and 30s, focusing on building a foundation for a solid financial future with budgeting, saving, and planning for future financial goals like buying a home or starting a family. There are a few key steps you should take during this phase, including:

Build an emergency fund with 3-6 months of living expenses. Even minor unexpected expenses can significantly impact your finances if you’re unprepared!
Start contributing to retirement accounts like a 401(k) or IRA to benefit from compound interest. Take advantage of your employer’s 401(k) match if offered. There are quite a few options available when it comes to saving for retirement, so sit down with your financial advisor to review the specifics to make the most of your money.
Pay down high-interest debt, such as credit cards or student loans to improve your credit and minimize your total amount paid over time.
Set financial goals, such as saving for a home or future family needs. Having goals allows you to track your progress and adjust your financial actions as needed.

Building Wealth (30s – 40s)

The next stage of your financial roadmap takes place in your 30s and 40s and is all about growth and building on the foundation you have already set. Whether you are focused on career advancement, saving for a home, or planning for your family’s financial future, this phase is a critical time for making smart financial moves and fine-tuning your financial goals. During this stage, you should:

Maximize retirement contributions and take full advantage of employer matches. As you advance in your career and your annual earnings increase, you may be able to make additional contributions to your retirement fund, further securing your and your family’s financial future.
Diversify your investment portfolio to balance growth and risk. Consider stocks within different industries, bonds, real estate, and other investment opportunities to improve your portfolio. You never want all of your eggs in one basket!
Set up or review life insurance to protect your family’s financial future. It is important to have a plan in case anything happens to you and your loved ones unexpectedly.

Preparing for Retirement (50s – 60s)

In your 50s and 60s, it’s time to focus on securing your financial future and preparing for retirement. Whether you are paying off your mortgage, planning for healthcare, or making the final push toward your retirement savings goals, this stage is all about making sure you’re set for the years ahead. This phase of your financial roadmap is the time to take charge and fine-tune your retirement strategy to make sure everything is in place. We recommend:

Increasing retirement contributions and using catch-up contributions if applicable.
Paying off large debts, like mortgages, to reduce expenses in retirement. This leaves more money for the things you want to do!
Reviewing and updating your estate plan, including your beneficiaries.
Planning for Social Security and other income sources in retirement.

Following this checklist will help you confidently prepare for your next chapter!

Living in Retirement (60s+)

The last stage featured on your financial planning roadmap is living in retirement through your 60s and beyond. This phase is about enjoying the life you’ve worked so hard to build while ensuring your financial future remains secure. To best enjoy the rewards of your hard work and maintain your lifestyle with minimal financial stress:

Develop a withdrawal strategy to ensure your retirement savings last. You don’t want to run your savings dry within the first few years!
Manage your investments to align with your income needs and risk tolerance.
Monitor your healthcare and long-term care costs, ensuring you have adequate coverage for the care you need.
Review and update your estate plans periodically to protect your financial legacy.

Stay connected with Blakely Financial as we continue to provide the guidance you need at every stage of life for a prosperous financial future.

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.

What to Know About 401(k) Contributions

Posted on September 6, 2024October 4, 2024 by Robert 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, 2024October 4, 2024 by Steve LaFrance

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.