Blog

Welcome to Reston Wealth Management’s blog where Alex Voorhees, CFP® discusses various issues related to wealth management in a one minute or less read.

We will discuss a number of topics, including taxes, budgeting, investments, market updates, Social Security & Medicare, and estate planning.

Our goal is to explain OLD concepts that our readers may have heard before in a NEW and SIMPLE way.

 

Tuesday, June 18, 2019

In this three part series I will be discussing the importance of sequence of withdrawal – in other words, which accounts to use first for income needs. Part 1 – Background on planning principles In general there are three...

 

Tuesday, June 11, 2019

I recently wrote about Income-Related Monthly Adjustments to your Medicare premiums. In this post I want to discuss circumstances where we have seen successful appeals and how you can go about doing that. As a refresher, your Medicare...

 

Tuesday, June 4, 2019

There are almost too many options to choose from when it comes to monitoring and protecting your credit history. To simplify, I will discuss three common FREE options. Let’s be honest though – we all know nothing is really...

 

Tuesday, May 28, 2019

In the previous 3 weeks, we have discussed several strategies for withdrawing from retirement accounts without incurring the 10% penalty. In these cases, it didn’t matter as much what you were using the funds for. However, the...

 

Tuesday, May 21, 2019

One of the most common reasons that individuals have to tap retirement funds before age 59 ½ is the death of a spouse. These situations can put enormous financial stress if proper life insurance is not in place. It’s...

 

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Tuesday, May 14, 2019

One strategy that can free up significant amounts of cash fairly quickly is a 401(k) loan. Many plans permit loans from your 401(k) that can be paid back over varying lengths of time, sometimes as long as 5 years, or even 10 years if...

 

Tuesday, May 7, 2019

If you find yourself in a situation that requires a withdrawal from your retirement accounts, there may be ways to do so without incurring the typical 10% early withdrawal penalty. Over the next few weeks, I will discuss a few of these...

 

Tuesday, April 30, 2019

Once settled on your home, you will want to take care of changing your address and updating billing. Suggested Billing Changes Old mortgage company – They should refund you your escrow account and any unused interest. Utilities...

 

Tuesday, April 23, 2019

When putting an offer on a home, there are a few things to consider aside from price Timing – If you like a home but are not planning to offer list price, it is usually advisable to wait a few days after it comes on the market to...

 

Tuesday, April 16, 2019

The process of selling your home can be broken into a few stages before final settlement. Staging – At this point, your realtor should bring a stager through the home. It was at this point that my wife and I looked at each other...

 

Tuesday, April 9, 2019

Finding the right people to help with the home buying process can make all the difference. Realtor – The best realtors are the ones who have been referred, are well organized, and take time to get to know you. When interviewing,...

 

Tuesday, April 2, 2019

With a growing family this past year, my wife and decided to sell our first home and buy a place with a little more space. Along the way, we did some things right and some things that were valuable “learning lessons.” So as...

 

Tuesday, March 26, 2019

You may have already decided that you’re taking Social Security as soon as you’re eligible, age 62 for most. Or you may be confident about waiting as long as possible, age 70. However, several factors should be considered...

 

Tuesday, March 19, 2019

If you’re still working – either in the middle of your career or approaching retirement – you may not be inclined to notice changes to Social Security. However, they can certainly have a tremendous impact on you, not...

 

Tuesday, March 12, 2019

In short, yes. However, the degree to which they are taxed varies by income. This is different from your paycheck, where for everyone, the entire pay minus deductions are subject to taxes of some sort. The term for the portion of your...

 

Tuesday, March 5, 2019

As tax season rolls around, many may find that their charitable gifts didn’t make the same impact to their taxes as they have in the past. One main reason for this is the higher standard deduction that started in 2018. Because of...

 

Tuesday, February 26, 2019

Most people know it is important to have cash on hand for emergencies or a large planned purchase. In fact, I suggest having at least 3-6 months of expenses plus any big purchases you plan to make in the next 12 months on hand. The...

 

Tuesday, February 19, 2019

It’s no secret that student loans have grown exponentially over the past 30+ years, as tuition has risen at a much faster clip than inflation. Because of this, many students are left with loans for years after graduation. Most of...

 

Tuesday, February 12, 2019

A question that comes up often is whether or not it’s wise to become more conservative as you approach or are in retirement. I respond by asking three questions focused on risk tolerance – What are you comfortable with? How...

 

Tuesday, February 5, 2019

Individuals in the process of buying a home with a mortgage know the process of getting a loan approval comes with a maximum loan amount. However, many mistake this for what they can actually afford. No. The maximum loan amount is what...

 

Tuesday, January 29, 2019

We all have preconceived notions about money, and we ought to take some time to ask where they come from. For many of us, the answer is our parents. Our early childhood experiences influence many of the opinions we have about savings,...

 

Tuesday, January 22, 2019

By now you know that we preach the value of a financial plan. While it does serve the purpose of answering the question “Am I on Track?” it also helps create a blueprint for making wiser financial decisions. While in...

 

Tuesday, January 15, 2019

There are various psychological biases that play out with investing. Many are well known such as the “hindsight bias” where we tend to view past events as predictable after the fact. However, one lesser known but damaging...

 

Tuesday, January 8, 2019

I wanted to start this New Year with a series on behavioral finance; hopefully making a resolution to push back on few biases that we may have that can hurt us in the long-run. According to a study from a few years ago, the average...

 

Tuesday, December 18, 2018

Is Social Security taxable? Sorry, you’re going to get your least favorite answer – it depends. For most individuals who work, 100% of wages are subject to taxation before deductions. When you start taking Social Security...

 

Tuesday, December 11, 2018

In the era of ultra-low interest rates, many car dealers offer financing for new cars at 0% for several years. This essentially allows you to pay the purchase price and nothing more but spread out the payments over time. While these...

 

Tuesday, December 4, 2018

Following the series on teaching children about money, I found myself trying to find new ways to compare finances to things we interact with regularly. So at the risk of sounding cheesy, I’ll start with the example of a football...

 

Tuesday, November 27, 2018

During the last 3 weeks, we have focused on teaching children where to save first, the various types of accounts, and the magic of compound interest. Now it’s time to help them choose investments. If needed, start by explaining...

 

Tuesday, November 20, 2018

“Compound interest is the eighth wonder of the world. He who understands it, earns it…he who doesn’t, pays it.” – Albert Einstein. If this is true, then we ought to explain to our children how to earn it,...

 

Tuesday, November 13, 2018

Last week I reviewed the priority of saving and listed several different types of accounts to save in. This week, I want to provide clarity around the types and common purpose of various accounts. In general, there are three broad...

 

Tuesday, November 6, 2018

As an opening to this series on Teaching Children about Money, I want to share my desire for educating the next generation. A common pattern that we see with many of our clients is that they were taught very little about money from...

 

Tuesday, October 30, 2018

Real Estate can be a great diversifier in an investment portfolio. When evaluating whether a rental property is good investment for you, consider at least two questions. What is your liquid vs. illiquid ratio? – Liquid assets are...

 

Tuesday, October 23, 2018

Roth IRAs are a popular retirement planning tool. But they can be used as a generational planning tool as well. Roth IRAs provide several important advantages that include, but are not limited to, tax-free growth and not being subject...

 

Tuesday, October 16, 2018

Last week I discussed an example of using a Roth conversion ladder as a strategy for early retirement. However, this does not make sense for everyone, especially for those with higher earnings and thus higher tax brackets prior to...

 

Tuesday, October 9, 2018

59 ½ is an oddly specific age. But it’s the age that has several retirement rules around it that often dictates when people decide to retire. Because of those rules, many individuals feel like they can’t afford...

 

Tuesday, October 2, 2018

When a last will and testament is drafted, usually the testator, the person drafting the document, selects an executor. While this may seem like an honor, the role of serving as an executor comes with numerous responsibilities. Their...

 

Monday, September 24, 2018

Did your child just graduate college? You may want to make them aware of a few tax strategies to take advantage of during the “half year.” The “half year” refers to the time after graduation and before the end...

 

Monday, September 17, 2018

“At your current earnings rate, if you continue working until…” Those words are often passed over but are extremely important, especially if you plan to retire early. Social Security calculates your estimated benefit...

 

Monday, September 10, 2018

For those on Medicare, starting Medicare, or researching Medicare for the future, you may have come across an acronym, IRMAA. It stands for your Income-Related Monthly Adjusted Amount. Medicare premiums are based on income and if your...

 

Tuesday, September 4, 2018

Over the past few years, there has been a major push toward the lowest possible expenses for index funds by the major investment companies. While there are advantages to having low or zero expense, expenses are not the only thing to...

 

Monday, August 27, 2018

Those with company stock in their 401(k) may be able to take advantage of a little known tax strategy called Net Unrealized Appreciation (NUA). While it varies by plan, usually once you are retired, you are eligible to take an in kind...

 

Monday, August 20, 2018

One roadblock that keeps many people from retiring early is the burden of health care expenses before Medicare. While there is certainly reason to be concerned, there are several strategies you can use to mitigate these costs. I will...

 

Monday, August 13, 2018

There has been a growing frustration among individuals searching for new long-term care insurance. The issue? Premiums have grown tremendously over the past few years. One solution that has become increasing popular is a tax-free 1035...

 

Monday, August 6, 2018

Because of the great tax advantages that these accounts provide, coupled with staggering growth in tuition costs, many people wonder how soon they can start funding 529s. We’ve had a growing number of clients even ask if they can...

 

Tuesday, July 31, 2018

Should you take benefits at age 62, full retirement age, age 70, or somewhere in between? The decision is already complicated enough without getting into the details of unique widow benefits. If you are a widow and meet certain...

 

Tuesday, July 24, 2018

Managing your Business Cash Reserves Welcome to the part 2 of 2 in this short series on managing the cash flow of your business. In the previous post we discussed how to create a priority of saving outline. At the end of the post I...

 

Tuesday, July 17, 2018

How to prioritize personal savings as a Business Owner Welcome to part 1 of 2 in this short series on managing the cash flow of your business. In this first post, we will discuss taking a look at your larger financial picture that...

 

Tuesday, July 10, 2018

The Importance of Asset Location Asset location is a term used to describe how investments are distributed across various saving vehicles. For example, you may have an IRA, a Roth IRA, a Trust or Joint investment account, a 401(k), etc...

 

Tuesday, July 3, 2018

IRA’s and Charity in 2018 A Qualified Charitable Contribution (QCD) A Qualified Charitable Contribution (QCD) is a direct transfer of funds from your Individual Retirement Arrangement (IRA), made payable to a qualified charity....

 

Tuesday, June 26, 2018

With the 2017 Tax Cuts and Jobs Act going into effect, there are several tax and investment opportunities regarding Roth IRA’s. I am going to discuss two; Conversions and Recharacterizations. As a refresher, a Roth IRA is a...

 

Wednesday, June 13, 2018

The words ‘bear market’ have been bandied about a lot lately. When you read or hear them, remember to respond the same way you would if you saw an actual bear in the woods – by staying calm and keeping your wits about you. A changing...