Financial Advisor News

Piedmont, CA

Financial Advisor News

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Piedmont, CA

by: ALISON VAN DYKE

FIRST AND MAIN FINANCIAL

(510) 601-1935

Oakland, CA | Top Financial Advisors in the East Bay Help with Tax Planning

If you have been working for the last 10-15 years and have consistently contributed to an employer-sponsored retirement plan, the growth (thanks to a 10+ year bull market!) will most likely have compounded into a sizable sum of money.

With at least 15-20 years until retirement, you are in an ideal situation to make important financial choices that will have a significant impact on the rest of your life.  The first and most important step is to develop a comprehensive financial plan so you know where you currently stand and can begin sculpting your future.  We know the future is unpredictable, but when we construct a financial plan, we are able to make educated, well-informed assumptions, that help project where a client may be financially throughout their lifetime.  Of course, these assumptions and estimates will not be 100% accurate, but they are not expected to be.

When working on a retirement calculation, the goal is not to predict the future, but rather encourage wise financial decisions and behaviors now.

In our practice, we use a sophisticated financial planning software package, eMoney Advisor.  We use this tool to project annual cash flows.  We calculate final portfolio assets and a net worth at end-of-life, and can identify what year a client most likely run short.  These are important outputs of the financial planning process.  However, the main benefit is that once we have this baseline established, we can modify the assumptions and estimations, and dig deeply into specific planning opportunities that should be considered now.  In many cases, it is only when the financial planning model is fully developed that certain opportunities present themselves.  The model allows us to help our clients make wise, well-informed financial decisions now and as a result, enjoy the benefits over many years, and in many cases pass on these benefits on to their heirs.

A couple, both 45 years-old, for whom we recently did a plan, came to us with multiple streams of income expected to be available at retirement; social security benefits, rental income, and investment income in the form of dividends.  There would also be tax-free Roth income to supplement as needed.

With multiple sources of income at retirement to cover approximately 85% of their expected expenses, their projected required minimum distributions (RMDs) at age 72 were much higher than they needed to be. Our clients were going to have to withdraw significantly more money annually than would be needed, placing them in a higher tax bracket.  Understanding this scenario early enough allowed us to create a long-term plan to manage and reduce their tax liability and allow them to reach and exceed their financial goals and objectives.

Each tax year presents an opportunity to make wise financial decisions that will impact the rest of your life. If you do not have a plan, you’ll be missing out.

If you are looking for financial guidance, whether it be for a one-time financial plan or continuing advice on your investments, we invite you meet with a First and Main Financial planner for a free consultation.  We would be more than happy to sit down with you, assess your financial situation and review with you our services to help you navigate a healthy financial future.

Oakland, CA| Best Financial Advisors East Bay Discuss Term Life Insurance with T…

What is Term Insurance and When Should you Consider it?

We recently worked with a young couple who is expecting their first child.  While reviewing their financial plan with them, we covered the various types of insurance that they might consider.  They were not familiar with Term Insurance: a type of life insurance policy that provides coverage for a defined period of time or term; usually twenty or thirty years.  If the person who is insured dies during the term, a death benefit would be paid to the beneficiary.

Many clients we work with already have some form of life insurance, usually group term life insurance, through an employer.  Term insurance, however, will give you coverage that is portable if you leave your job and is a relatively inexpensive way to ensure that you (or your partner/spouse) will have funds in the event that something unfortunate happens.  There are various types of term insurance policies available (convertible term, increasing term, etc.).  You would need to look at the pros and cons of the various policies and decide what best fits your life.

Term life policies don’t build cash value. You receive a fixed amount that is determined at the beginning of the policy term.  The premium is generally a fixed amount paid monthly or annually for the term of the policy.  The premium is determined based on a variety of factors (age of insured, the payout, health history, etc.).  A typical type of term insurance is “level term” policy. Twenty years is generally considered, as that time period typically covers a child until they are able to care for themselves.

There is no perfect methodology to determine how much life insurance to buy, but figuring out your after-tax income replacement can be a starting point; some people purchase more and some less.  Generally, you could get a few quotes just to compare prices.  Overall, term life insurance policies do provide peace of mind, especially for young families who may need to take care of young children.

If you are looking for some more financial guidance, whether it’s for a one time financial plan or continuing advice on your investments, we invite you to meet with a First & Main Financial planner for a free consultation.  We work with a variety of clients who are looking for a relationship with a knowledgeable and trustworthy advisor.  We would be more than happy to sit down with you, assess your current financial situation, and review with you our services to help you navigate your own financial future.

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BIO: At First & Main Financial, Alison Van Dyke helps clients with their financial lives. She has worked in Corporate Finance for Bank of America and Chase Manhattan Bank. Alison is pursuing the CFP® certification; she received her MBA at Georgetown and her B.A. in Political Science from UCLA.

235 Wildwood Avenue,
Piedmont, CA 94610, USA

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Piedmont, CA 94610, USA

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BIO: At First & Main Financial, Alison Van Dyke helps clients with their financial lives. She has worked in Corporate Finance for Bank of America and Chase Manhattan Bank. Alison is pursuing the CFP® certification; she received her MBA at Georgetown and her B.A. in Political Science from UCLA.