May 2024 Best of the Web

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As spring prepares to turn to summer, in some ways it feels like time is going backwards…. to 2020. Speculation is running wild with meme stocks and cryptocurrencies back in the news while the US stock market hits new highs. Don’t look for any further mention of those topics here!

Instead, resources will focus on understanding the rules and principles that will help you be better long-term investors and keep more of your money after taxes. We’ll explore important financial planning topics that will help you use your money to live a more fulfilling life, and do so sooner than many people may think is possible.

I will also cover a current topic that is not getting enough attention and share some timely opportunities. Let’s dive in….

Know the 5-Year Rules

A few months ago, I shared a post by one of my Abundo colleagues, Olivia Lima, about Timing a Roth Conversion to Supercharge Your Retirement. That post led to a discussion in the comments about the “5-Year Rules” related to Roth IRAs.

I was planning to write a full blog post to cover this confusing topic. However, Jim Dahle explained these rules (and a few others) as clearly as can be done. So I’ll kick off this months resources by sharing his blog post that does so: The 5-Year Rules.

Know Your Social Security Terminology

Another area that is maddeningly complicated is Social Security. Much of the confusion related to Social Security stems from the terminology this program uses.

Mike Piper lays out a concise guide to Avoiding Miscommunication with the SSA.

Words of Wisdom

Congratulations to Richard Connor for reaching the milestone of his 150th article published on the HumbleDollar blog. He shares a lot of wisdom, writing Many Words Later.

Why Diversify?

As the U.S. stock market continues a remarkable run and again sits at or near all time highs, I frequently discuss with clients whether international diversification makes sense. If you share these concerns, I encourage you to consider the next resource.

Ben Carlson explains Diversification is About Decades.

A New Risk for Homeowners?

In a recent post on this site, David shared his internal debate about whether to pay off his mortgage. One argument he made against paying off the mortgage was having a paid off home represented a potential “single point of loss.”

As recently as a few years ago, I would have considered this a weak argument. You could easily insure your home. Risk managed. Crisis averted.

When I started working with clients a year ago, I quickly learned that this was not the case in states including Florida and California. Since then, the situation with the home insurance market has only gotten more challenging and widespread. The increased cost and difficulty insuring your home is a risk we all need to be aware of and consider.

Here is an excellent discussion of the situation from The Daily Podcast: The Possible Collapse of the U.S. Home Insurance System.

New Vanguard Fees

Vanguard captured headlines this month with the announcement of new fees. Allan Roth explains that they are likely a non-factor for most people reading this. He writes About Those New Vanguard Fees.

Earn Free Summer Travel

The first travel credit card I recommend to anyone wanting to start earning travel rewards is the card_name. That’s because this card is easy to use for almost any travel expense, while providing even more value if you transfer these rewards to a Chase travel partner.

The already valuable card_name currently is offering an increased sign-up bonus of 75,000 bonus points when you spend at least $4,000 on the card in the first 3 months from account opening.

That’s worth at least $900 when you redeem the points through Chase Travel℠. It can potentially be worth more if you transfer these valuable rewards to travel partners including Hyatt hotels or one of their many airline partners.

The card has a $95 annual fee. These are affiliate links and signing up for credit cards for these links provides income to support the blog.

Real Financial Planning

Financial planning is often associated with investment management or the sale of insurance products. This makes sense, as this is how most people presenting themselves as advisors were traditionally paid and thus where they focused their attention.

As new models of paying for advice emerge, I hope to see financial planning evolve into a profession where consumers can expect…. actual financial planning! These next two resources highlight this.

Meir Statman writes A Wealth of Well-Being: A Holistic Approach to Behavioral Finance.

Abundo Wealth’s newest advisor Riki Cooke shares planning ideas he has incorporated to live a fuller life now, rather than waiting until retirement. He writes How to Fit a Sabbatical Into Your Career.

Gaining Financial Planning Experience

Since I shared my story of completing the CFP® education and exam, I’ve had a number of long-time readers share similar aspirations. I’ve also gained a number of new followers based on that post.

If you fall into either of those categories, I encourage you to check out The Externship. This program is for “anyone interested in starting or advancing in a career in financial planning.” Participating in this program provides access to training and experience in a variety of planning domains as well as 500 experience hours towards CFP® certification upon completion.

I have no financial relationship with this program. I have had the opportunity to meet founder Hannah Moore recently and am impressed with what she is doing to further the financial planning profession.

Reviewing Your Tax Return

One of the most valuable things that was driven home in my CFP® education was the importance of understanding the flow of income taxation. This begins with determining all of your income and ends with determining your net tax payable or refund due.

Reviewing your most recent tax return can be invaluable to understand how this process works and see areas that you could optimize. This month, I had Maggie Klokkenga, CFP®, CPA explain the Story Your Tax Return is Telling.

If you found that a helpful starting point and want to get deeper into the weeds reviewing your tax return, I encourage you to check out the video below from Cody Garrett, CFP®.

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[Chris Mamula used principles of traditional retirement planning, combined with creative lifestyle design, to retire from a career as a physical therapist at age 41. After poor experiences with the financial industry early in his professional life, he educated himself on investing and tax planning. After achieving financial independence, Chris began writing about wealth building, DIY investing, financial planning, early retirement, and lifestyle design at Can I Retire Yet? He is also the primary author of the book Choose FI: Your Blueprint to Financial Independence. Chris also does financial planning with individuals and couples at Abundo Wealth, a low-cost, advice-only financial planning firm with the mission of making quality financial advice available to populations for whom it was previously inaccessible. Chris has been featured on MarketWatch, Morningstar, U.S. News & World Report, and Business Insider. He has spoken at events including the Bogleheads and the American Institute of Certified Public Accountants annual conferences. Blog inquiries can be sent to Financial planning inquiries can be sent to]

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Disclosure: Can I Retire Yet? has partnered with CardRatings for our coverage of credit card products. Can I Retire Yet? and CardRatings may receive a commission from card issuers. Some or all of the card offers that appear on the website are from advertisers. Compensation may impact on how and where card products appear on the site. The site does not include all card companies or all available card offers. Other links on this site, like the Amazon, NewRetirement, Pralana, and Personal Capital links are also affiliate links. As an affiliate we earn from qualifying purchases. If you click on one of these links and buy from the affiliated company, then we receive some compensation. The income helps to keep this blog going. Affiliate links do not increase your cost, and we only use them for products or services that we’re familiar with and that we feel may deliver value to you. By contrast, we have limited control over most of the display ads on this site. Though we do attempt to block objectionable content. Buyer beware.

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