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Funds in a 529 college savings plan can be transferred, or rolled over, into a Roth IRA (a 529-to-Roth IRA transfer) starting next year. Key Points about 529-to-Roth IRA Transfers The 529-to-Roth IRA Transfer Rule Limitations on 529 to Roth IRA Conversions Understanding 529 College Savings Plans How Does the 529-to-Roth IRA Work? An Illustration […]

Parents can avoid taxes by rolling over savings bonds to a 529 plan. We will discuss how to convert United States savings bonds into a 529 plan, without paying Federal tax on the earnings. If you are a long-time Wealth45 reader, you know we have touted the high interest rates paid on Series I savings […]

Ten finance numbers to know as you navigate the complex world of personal finance. Understanding key numbers can be crucial to making informed decisions and securing your financial future. From retirement savings to credit scores, here are ten important finance numbers to know.   10% Fraction of your income to save for retirement throughout your […]

A donor-advised fund (DAF) is an investment account specifically designed for charitable giving. It allows you to donate cash, appreciated securities, or other assets to a sponsoring charity (i.e., the DAF sponsor). You receive an immediate tax deduction, and then recommend grants from the fund to your favorite charities over time.   DAF Benefits One […]

When is the optimal time to sell my RSUs? Many technology company employees receive grants of Restricted Stock Units (RSUs). This form of equity compensation may be in the form of a one-time hiring bonus, a reward for exceptional performance, or part of the annual compensation program. Regardless of how you received your RSUs, everyone […]

Are you saving enough for retirement? Can your investments support your retirement spending desires? These are difficult questions to answer. It boils down to how much money you need in retirement to maintain an acceptable lifestyle. Unless you are close to retiring, you likely don’t have a good grasp of your retirement spending needs. How […]

The FIRE movement is about Financial Independence, Retire Early (FIRE). Generate enough “income” from your investments to cover your expenses, so you no longer needing to work to pay your expenses (all prior to traditional retirement age). The core principals include: Dramatically reduce expenses Save aggressively and funnel savings into investments Accumulate enough assets to […]

Having a child is a defining moment in everyone’s life. And as with all major life changes, it is vital to have a plan and be aware of the financial implications. This post aims to help new parents become more financially savvy as they nurture their new baby. Here are a few concrete steps to […]

Arguably, the simplest of all investments—U.S. Savings Bonds—may be the best current hedge against inflation available. As discussed in my prior post, Are TIPS a Good Investment, TIPS are nearly the perfect inflation hedge. Your return is fully protected from inflation since the bonds yield is adjusted based on actual inflation experienced. You receive a […]

How 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 […]

How do your finances stack up? How are doing compared to others? Are you accumulating assets faster or slower than your peers? How does your net worth measure up to the rest of the country? This is the second posting in a series exploring these questions. (See Part 1 – Income) Every three years I […]

Tech employees – as a group – are highly-compensated. However, it may not feel that way given the high cost-of-living in many tech hubs like Seattle and the San Francisco Bay Area. To keep grounded, every three years I look forward to the latest Federal Reserve Board’s Survey of Consumer Finances (SCF) to remind us […]

As 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 […]

As 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 […]