🧐 What should I do in 2024 to help my long-term financial plan?
Welcome to 2024. I hope your start to the New Year has been a good one. I don’t want to waste any time so let’s jump into some exciting news and important money topics for 2024.
💃🏻Exciting news – our team is growing!
I’m so excited to introduce Deb Burdick, my newest team member. She has been in the financial services industry for decades and will be a great resource for my team. She is located in Florida, and in her free time she loves to 🚣♀️ kayak, and volunteers her time to protect natural resources. Stay tuned for more news about our team in the coming months.
📆 So what should I be doing for my 2024 financial planning?
1️⃣ Make a note to INCREASE my maximum retirement plan deferrals.
The IRS announced that the maximum contribution to 401k plans increases in 2024 to $23,000 from $22,500, and if you’re 50 or older, you can also add an additional $7,500 in catch up contributions (unchanged from 2023). Thus, if you’re over 50, that means you can contribute $30,500k as employee deferrals (aka, comes from your income).
And NOTE – your MAX employee contributions do NOT include your employer match. Any employer matches are additional savings.
Also, the annual limit on contributions to IRAs increases in 2024 to $7,000, which is up from $6,500. The catch-up contribution if you’re 50 or older will not change – and remains at $1,000 (so $8k max if you’re over 50).
2️⃣ Review my personal goals, resources, time horizon, and investment philosophy.
I’m a NON-JARGONY, non-mansplaining advisor. And as such, I like to keep things simple. When working with clients, my investment philosophy can be explained as such:
🏃♀️It’s a marathon, not a sprint. Financial planning is an iterative process. We focus first on those issues with the most potential to derail your plan, sorting out your unique situation to lay the groundwork for moving ahead. We create a GPS together – and when you get off track, we readjust, and steer you back in the direction of moving forward.
🥇You have to be in it to win it. I’m generalizing, but very often women tend to approach their investments conservatively. If our time horizon permits, we often want to include a healthy allocation to stocks. We do not want to miss out on market opportunities, or leave them all for the men! I also believe that women tend to invest in things that improve the world (see more later about my upcoming event in honor of International Women’s Day).
🧤Fits like a glove. Each client comes to me with their own unique background and money story. Most have not had any financial education, which is, unfortunately, typical in this country. We do not do a good job providing our young adults with “Personal Finance 101” knowledge.
If you feel you don’t understand as much as you’d like to, please do not feel any shame and know that you’re not alone! Just take that first step and reach out, so we can partner. We will work together to craft your unique puzzle pieces into a strategy that fits with your personality, values, and goals. And we will readjust as often as necessary (see #1 above – financial planning is like a GPS)!
3️⃣ Get excited about Secure 2.0 Act.
More good news for small business employers with less than 50 employees, the retirement plan start up credit will now be allowed for 100% of plan start-up costs. Please be sure that your CPA or tax preparer is aware of your start up retirement plan, and IRS form 8881 for the tax credits.
If you contribute to a 401k – you can now choose to have your employer matching contributions arrive as ROTH contributions, instead of only pre-tax. You will owe income tax on those contributions but they are not subject to a vesting schedule.
Section 126 discusses unused 529 (educational) plan assets. If the 529 plan has been maintained for at least 15 years, and the ROTH IRA is owned by the beneficiary of the 529 plan, any unused plans can be used for ROTH IRA contributions. Basically, this provides flexibility for unused 529 plans, and offers another purpose for the funds – allowing unused educational savings to be transition to retirement savings.
If you’re born in 1960 or later, your RMDs (Required Minimum Distributions) from your retirement savings are not required until you’re 75. Why is this good? Many of us plan to work beyond 70 years old – this allows us to continue earning and supplementing our retirement savings. It also gives us a few more years to consider ROTH conversion strategies.
All inherited retirement accounts are STILL required to be fully distributed within 10 years of the original account holder’s death (no change from Secure 1.0)
Qualified Charitable Distributions (QCDs) can still be made starting at 70.5 years. If you’re charitably inclined - let’s discuss further!
4️⃣ Mark your calendar for upcoming events!
We’ll be hosting a live event in honor of International Women’s Day, on Friday, March 8th, at noon, at the Winchester, MA public library large meeting room. We’ll be discussing Gender Lens Investing – and how you can think about investing according to your values. While the event is free, we are requesting that attendees bring feminine menstrual products that will be donated to a local charity. Contact me if you’d like more info or to be added to the guest list.
We continue to host our monthly Green Buzz Talk and Teach, virtual events. We discuss personal finance and answer your timely questions. This event is for women only and offers a safe space with NO JARGON and NO MANSPLAINING. They take place on the fourth Tuesday of the month, from 12pm est to 12:30pm est – sign up here.
5️⃣ Check out our VIDEO collection.
I’m passionate about financial planning, and love educating and sharing ideas in a non-jargony way. Check out the growing video collection here. And if you haven’t already connected, I encourage you to link up with me on social media.
👏 More exciting news!
Last year I completed the studies to become an IRS Enrolled Agent – which will allow me to prepare taxes for clients. This tax season, I’ll be working closely with a female owned CPA firm, hoping to be able to launch tax prep for my clients. Stay tuned – and reach out if that is something you’re interested in for the 2023 tax season.
⛷️ What do I do to survive New England winters?
I’ve been listening to the Huberman Lab podcast, which talks about sleep, diet and exercise. The Standford neuroscientist speaks of the benefits of being outside while the sun rises. I do try to get outside for early morning runs, as often as possible. (check out this video on “Blue Monday”). This morning the sun was a brilliant pink! It is fun to see it rise over the Boston skyscape.
➡️ Clients – don’t forget to schedule your Q1 review so we can address your goals for 2024!
If you are an existing client, please schedule a “Client Review”. If you’re not yet a client but would like to chat, schedule a “Complimentary Consult”.
Required Disclosures
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. Past performance is not indicative of future results.
Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price. An increase in interest rates may cause the price of bond mutual funds and ETFs to decline.
An investment in Exchange Traded Funds (ETF), structured as a mutual fund or unit investment trust, involves the risk of losing money and should be considered as part of an overall program, not a complete investment program. An investment in ETFs involves additional risks such as not diversified, price volatility, competitive industry pressure, international political and economic developments, possible trading halts, and index tracking errors.
Mutual fund and stock investing involves risk, including possible loss of principal.