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15 Jun '21Hiring an Investment Advisor
Continue readingIt would be overwhelming to research all the different financial advisory firms and investment advisors out there today. Is there really a difference between firms? Who is a good advisor? Whom can I trust? Given this uncertainty, most people just solicit a recommendations from friends or family. Then hire the recommended advisor without really examining […]
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02 Feb '21Financial Rubbernecking – Part 3: Retirement Accounts
Continue readingHow do your retirement savings stack up? Are you accumulating retirement assets faster than your peers? This is the third posting in a series exploring these types of questions. (See Part 1 – Income; See Part 2- Net Worth) Every three years I look forward to the latest Federal Reserve Board’s Survey of Consumer Finances […]
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06 Sep '20How Much Wealth Should You Have by Age 45?
Continue readingAs a rule, people like to know if they are making progress toward a comfortable retirement, how their wealth compares to their peers, and how their investments are performing. When saving for retirement, the question is often “how much should I have saved at my age?” Ideally, this question would be answered in the context […]
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31 Jul '20Target Date Retirement Funds
Continue readingThe most common investments in many tech company 401k plans are target date retirement funds. These funds provide employees with exposure to a diversified investment portfolio that systematically shifts out of risky asset classes (like stocks) and into less volatile investments (like bonds) as you get older and closer to retirement. Firms like Amazon.com and […]
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24 Jun '20Rule of 72
Continue readingAs you save for retirement, there is a simple rule of thumb for determining what your investments will be worth in the future. It is called the “Rule of 72.” This simple rule quickly tells you how long it takes to double your money at a given rate of return (or interest rate). Divide 72 […]
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02 Aug '19Roadmap to Retirement: FIRE or FRA
Continue readingA comfortable retirement—with ample assets—is the ultimate savings goal. Sacrifice consumption today so that one day you are financially independent and can retire with a fulsome lifestyle. Early retirement advocates have adopted the acronym FIRE (Financial Independence, Retire Early) as their rallying cry. The FIRE movement largely focuses on limiting expenses—living on a fraction of […]
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14 Apr '19The Magic of a Roth IRA
Continue readingA Roth IRA (Individual Retirement Account) offers a unique advantage for many investors; the magical ability to earn tax-free income. These tax-advantaged accounts allow you to indefinitely grow your investments without ever paying Federal income tax on interest, dividends, or capital gains. I say “indefinitely” because, as opposed to Traditional IRAs, there is no required […]
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25 Oct '18Amazonian’s $1 Billion Retirement Bet
Continue readingAmazon employees have invested $1 billion of their 401(k) retirement funds[1] in their employer’s stock—by far the single largest holding in Amazon’s 401(k) plan. Luckily, this was a very good bet during 2017 (up 56%) and has continued to be an outstanding investment during 2018 (up over 70% as of end of September). Implying a […]
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10 Oct '18Save Taxes on 401(k) Distributions
Continue readingPreferential Tax Treatment on Company Stock in Your 401(k) If you hold shares of your employer’s stock in your 401(k) account, there is an IRS rule with the potential to significantly reduce your future tax burden. The rule pertains to net unrealized appreciation (NUA). NUA is the difference between the price you originally paid for […]
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11 Mar '18How Do You Stack Up?
Continue readingEmployees at technology companies—as a group—are highly compensated. Nonetheless, it may not feel like it, given the high cost of living in tech hubs like Seattle or the San Francisco Bay Area. To keep grounded in reality, I look forward every three years to the Federal Reserve Board’s Survey of Consumer Finances for the latest […]
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01 Oct '17Savings Strategies for New Parents
Continue readingAs life starts settling back to a normal routine following the arrival of your child, your attention will turn to the daunting prospect of funding their education. Beyond the basic need to stash away dollars, there is a myriad of choices today for educational savings. Plus, keeping your retirement savings on track will avoid requiring […]
