Update RE: Economy, Inflation, and Fed

Retirement often conjures images of freedom—more time, less stress, and finally getting to enjoy the fruits of decades of labor. But the financial side of retirement requires more than just a healthy nest egg . It requires thoughtful planning, with priorities that evolve over time. Borrowing from the logic of Maslow’s famous hierarchy of needs, individuals can apply a similar framework to their financial lives. This “financial hierarchy of needs in retirement” offers a simple but powerful guide to help retirees prioritize their resources and decision-making—from basic income all the way to legacy planning . 1. Income: The Foundation Of Retirement Planning Just as air and water sit at the bottom of Maslow’s pyramid, income forms the base of any retirement plan. Without dependable income sources, even the best-laid financial plans fall apart. This foundation is typically built from Social Security, pensions, annuities, rental income, and systematic withdrawals from retirement accounts. Ensuring these income streams are stable, diversified, and tax-efficient is the first step toward a sustainable retirement. 2. Protection: Safeguarding The Plan Once income is established, the next layer focuses on protection—both personal and financial. This includes insurance coverage for health, life, and long-term care, as well as legal documents like wills, powers of attorney, and healthcare proxies. Retirement is filled with unpredictability. Whether it’s a medical event, a market downturn, or an unexpected death in the family, having protection in place shields the retiree—and their loved ones—from unnecessary hardship. 3. Emergency Reserves: Planning For The Unplanned An emergency fund may look different in retirement than it does during working years, but it’s no less critical. Instead of income loss, retirees may need quick access to funds for medical expenses, home repairs, or helping a loved one in need. These reserves help prevent the need to draw from investment accounts during downturns—buying both time and peace of mind. 4. Debt Management: Eliminating Financial Drag Managing debt in retirement is about creating flexibility. While some debt—like a manageable mortgage—might be strategic, high-interest obligations such as credit card balances can quickly erode financial security. Paying down toxic debt should be a priority. Reducing monthly obligations increases financial resilience and gives retirees more control over their spending. 5. Retirement Savings: Sustaining The Lifestyle At this stage of life, the focus shifts from accumulating to preserving and distributing assets. But savings still play a vital role, especially in the context of longevity. Strategic withdrawals, Roth conversions, and tax-aware drawdowns can help stretch savings further. Retirees should aim for a sustainable withdrawal rate while also considering market conditions and life expectancy. 6. Tax And Estate Planning: Optimizing For Efficiency And Legacy Once income and lifestyle needs are secure, attention turns to reducing tax liability and ensuring assets transfer smoothly to heirs or charities. This might include reviewing estate documents, updating beneficiary designations, and using strategies like donor-advised funds, trusts, or gifting plans. Proper estate and tax planning doesn’t just preserve wealth—it simplifies life for beneficiaries and ensures wishes are honored. 7. Aspirational Goals: College Funding, Travel, And Gifting At the top of the pyramid sit aspirational goals—the wants, rather than the needs. This includes things like funding a grandchild’s education, buying a vacation home, or supporting causes that matter. These goals can be incredibly fulfilling, but they should only be pursued once the core levels of the financial hierarchy are secure. Otherwise, there’s a risk of jeopardizing long-term stability for short-term desires. The Value Of A Hierarchical Mindset The idea behind a financial hierarchy of needs in retirement isn’t about rigid rules—it’s about intentionality. It offers a framework to evaluate trade-offs, reduce stress, and make complex decisions feel more manageable. Retirement comes with freedom, but also responsibility. By approaching it with a structured mindset—prioritizing income, protection, savings, and legacy—retirees can spend more time enjoying life and less time worrying about it. By Andrew Rosen, Contributor © 2025 Forbes Media LLC. All Rights Reserved This Forbes article was legally licensed through AdvisorStream.

A well-crafted budget can help transform your financial life. It is a personalized roadmap that ensures every dollar is used to fuel your most important goals. This article discusses five budgeting best practices that can help improve your financial management and lead to financial freedom. 1. Know Your Numbers Before you can budget, you need to understand where you are. This step is about getting a clear picture of where your money is actually going. Track Your Spending This will reveal a lot about your financial habits and guide you moving forward. For at least 30 days, meticulously track every expense, no matter how small. Use a spreadsheet, a budgeting app, or even a notebook. Your goal is to understand your actual spending habits. You might be surprised to see how much miscellaneous spending — like coffee runs or impulse purchases — is chipping away at your available funds. If you can, make expense tracking a continuous part of your financial management. It will promote mindful spending. Distinguish Between Fixed and Variable Expenses To create a functional budget, you must categorize your outflows. Fixed expenses are predictable and generally the same every month. Think of rent or mortgage, car payments, insurance premiums, and debt obligations. On the other hand, variable expenses fluctuate based on usage or choice. These include groceries, electricity or gas bills, entertainment, and dining out. This distinction is essential because your variable expenses are where you have the most control. It’s where you can tweak your budget in case you need to allocate more for savings or other financial goals. Base Your Budget on Net Income Also known as your take-home pay, net income is the amount you receive in your bank account after regular deductions, such as taxes and retirement contributions, are taken out. Never budget based on your gross income because that’s a sure way of coming up short every month. 2. Choose a Method That Fits You There is no one-size-fits-all approach to budgeting. The best budgeting method is the one you can actually stick with. Find a system that aligns with your personality, financial goals, and situation. Below are examples of popular approaches. The 50/30/20 Rule This is a simple guideline that divides your net income into three categories. You allocate 50% for needs (such as housing, food, transportation, and utilities), 30% for wants (such as dining out, going to the movies, vacations), and 20% for savings and debt repayment (rainy day fund, retirement savings, investing, or paying off credit card bills). You may also adjust the percentages depending on your goals. For example, if you want to increase your savings rate or get out of debt faster, you can set it to 35% and leave just 15% for wants. Zero-Based Budgeting You may use this method if you want to have maximum control over your income. You assign a purpose for every dollar before the month begins, so that your total income minus total expenses (including savings) equals zero. It doesn’t mean your bank balance becomes zero or that you spend away all your money, but it guarantees you are spending and saving with intention. This method can be very effective, especially for curbing overspending. It eliminates mystery or miscellaneous money because all your dollars are accounted for at the beginning of the budgeting process. Envelope System This is a cash-based method in which you assign a set amount to variable categories, such as groceries, entertainment, or personal spending, and place the money in envelopes. When the cash in each envelope is gone, you stop spending in that category until the next budgeting cycle. This system makes spending more visible and enforces a tangible limit. 3. Be Goal-Driven Without a purpose, your budget is just a spreadsheet or a list of bills. Having goals will provide motivation and maintain discipline. When you know why you are saying no to a potential purchase, it becomes much easier. Set Clear Goals Don’t just say you want to save money. Define what you are saving for. Is it for a down payment on a house? Do you want to buy a new car? Are you saving up for a child’s college education? Better yet, use the SMART criteria: make your goals specific, measurable, achievable, relevant, and time-bound. For example, instead of saying “I want to save for a vacation,” you could say “I will save $5,000 for a trip to the Philippines by December 31 next year.” Setting clear, realistic goals makes it easier to track your progress and be purposeful with your savings targets. It can also help you stick to your budget. Pay Yourself First A typical money mistake people make is saving what’s left after expenses — don’t. Shift your mindset and always save first. Treat savings as a non-negotiable. Consider it a payment to your future self. This way, you ensure there is money allocated to your savings, potentially earning interest and generating wealth, regardless of what else happens during the month. Prioritize Debt Repayment It will be hard to achieve financial progress if you carry debt, especially high-interest ones. You must target these debts as soon as you can. You may even consider prioritizing debt repayment over savings , as this can save you more money in the long run by reducing your total interest payments. 4. Optimize and Automate The key to long-term budgeting success is creating a system that works in the background, not relying on willpower every day. Automation removes friction and lessens the chances of human error in your process. Automate Fixed Bills and Savings With technology, it’s pretty easy to set up automatic transfers through banking apps or even your payroll system. This ensures you never miss a due date and incur late fees on your bills. You should also maximize this option for your savings and investment contributions. Set it up so that they transfer on the day you receive your paycheck. This can be a set-it-and-forget-it system that forces you to take care of priorities before you even have a chance to spend your money on other things. Plan for Irregular Expenses Life is rarely consistent. Expenses like annual insurance premiums, holiday shopping, vehicle registration, and property taxes can wreck your budget if you don’t plan for them. Create a separate sinking fund category in your budget. For example, if a $1,200 expense is due in December, set aside $100 a month in a dedicated account starting in January. You should also build an emergency fund to cover emergencies. Ideally, this fund should have at least six months’ worth of living expenses, kept in a separate savings account, and used solely for emergencies. Remember to replenish your emergency fund as soon as you can whenever you dip into it. 5. Review, Adjust, and Be Patient Treat your budget as a living document, not a rigid contract. It needs constant attention and refinement to remain effective. Conduct Regular Reviews At least once a month, preferably right before a new one starts, sit down and review your actual spending against your planned budget. Were you over or under? Where did you succeed? Do this monthly review to catch problems early, reallocate funds as needed, and gain valuable insights into your habits. Stick to Your Budget but Be Flexible While discipline is crucial when budgeting, nobody’s perfect. For example, say you spend more than your budget for groceries, don’t give up. Instead, adjust the plan for the rest of the month. Perhaps you can temporarily cut back on dining out to compensate. Take it as a learning experience and do better next month. Don’t be too hard on yourself. Expect mistakes, surprises, and temptations. Keep in mind that disciplined budgeting takes time. The key is consistency, and it always beats perfection. Final Thoughts Implement these five best practices to improve your budgeting and achieve financial freedom. Remember to treat your budget not as a punishment or restriction but as a way to organize and plan your finances. Let it be a liberating practice that generates wealth in the long run. For expert guidance and tailored advice, you may consult a financial advisor. By True Tamplin, Contributor © 2025 Forbes Media LLC. All Rights Reserved This Forbes article was legally licensed through AdvisorStream.

Starting next year, some older workers making catch-up contributions to retirement plans, like 401(k)s, may have to do so on a Roth basis. Secure 2.0, a federal retirement law passed in 2022, states that workers earning more than $145,000 must make catch-up contributions with money that's already been taxed.1 Other workers are still eligible to make pre-tax catch-up contributions. While Secure 2.0 had stipulated that this change should go into effect in tax year 2024, the IRS postponed it for two years.2 Now, many workers will see the change reflected in their retirement plans starting in 2026—although employers will have until tax year 2027 to fully comply with the regulations laid out by the IRS.3 "Hopefully, in the end, people will enjoy tax-free earnings," said Elizabeth Thomas Dold, a Principal at Groom Law Group. "Change is not easy for anyone, it’s hard for record-keepers and plan participants." Will This Change Help or Hurt Your Retirement Savings? This new change won't impact all retirement savers—only older workers who make catch-up contributions and who earned more than $145,000 in the previous year with their employer.4 This income threshold is indexed to inflation, so it may increase for the 2026 tax year. This means that, for 2026, your income will be determined by your wages on your W-2 form for 2025, according to Dold. As of 2025, employees aged 50 and over are eligible to make catch-up contributions worth up to $7,500 to a 401(k), for a total employee contribution limit of $31,000.5 Additionally, those aged 60 to 63 qualify for an even higher catch-up contribution. In 2025, these employees can contribute a total of $11,250 in catch-up contributions, for a total employee contribution limit of $34,750. Unlike traditional 401(k) contributions, Roth contributions require that people pay tax upfront, forgoing an immediate deduction from their income. However, once they reach age 59½, they can withdraw their earnings tax-free. This could be beneficial for those who believe that they'll be in a higher tax bracket in retirement or who want to stash money away for tax-free growth. The new change is also beneficial for the federal government, as it enables them to collect taxes on upfront contributions rather than wait until people take withdrawals. "This makes them [the government] a lot of money, and that [allows] them do other things that they could pay for," Dold said. However, Dold said that some higher-income workers may not be able to make catch-up contributions at all if their plan sponsor chooses not to offer the Roth feature. "The IRS clarified in the proposed and final regulations that plan sponsors do not have to eliminate catch-up contributions if they don’t want to add a Roth feature—it is only those $145,000 [earners who] will not be eligible to make any catch-ups, but everyone else 50 or older can still make pre-tax catch-ups," Dold said. The Bottom Line If you're an older worker who plans to make catch-up contributions next year to help bolster your retirement nest egg, you could be in for a substantial change. Those who earned more than $145,000 this year with their current employer may be required to make their catch-up contributions on a Roth basis, meaning they pay taxes on the upfront contributions in 2026. However, you may be excluded from this change if your employer doesn't offer a Roth feature or you earned less than the income threshold in 2025. Article Sources Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy. United States Senate Committee on Finance. "SECURE 2.0 Act of 2022." page 18. IRS. "IRS Announces Administrative Transition Period For New Roth Catch Up Requirement; Catch-up Contributions Still Permitted After 2023." IRS. "Treasury, IRS Issue Final Regulations on New Roth Catch-Up Rule, Other SECURE 2.0 Act Provisions." National Register. "Catch-Up Contributions." IRS. "401(k) Limit Increases to $23,500 for 2025, IRA Limit Remains $7,000." This Investopedia article was legally licensed by AdvisorStream.

There are a number of basic steps you can take to safeguard your personal information and financial accounts, as well as some more advanced services you can tap to automate your ability to track suspicious activity and potential exposure of your data. Consider using credit freezes or fraud alerts . These make it more difficult for fraudsters to secure loans or credit cards in your name. A credit freeze prevents anyone from checking your credit report or credit score (typically the first step creditors will take in reviewing applications for loans or credit cards). A fraud alert requires creditors to verify your identity before processing any application made in your name. Both of these free services make it harder for criminals to seek credit using your identity. How long does a security freeze last? A security freeze will remain on your credit file until you remove it. How can I unfreeze my credit file? You can permanently remove/lift a security freeze on your credit file with one click or schedule an unfreeze for a specified time period. A security freeze can limit access to your credit, even if it was authorized by you. If you know you are going to apply for new credit, you can plan ahead and unfreeze or schedule an unfreeze, before you apply. How long does it take to place or remove a security freeze? You can freeze and unfreeze your Experian credit file in real time using the online services. Explore each of the credit reporting agencies below by clicking the link under the logo. If you place a security freeze on your one credit report, it is not automatically shared with other credit reporting agencies. We suggest, at minimum, you freeze all 3. Links are below: Experian Equifax TransUnion IRS: Get an identity protection PIN (IP PIN) An identity protection PIN(IP PIN) is a six-digit number that prevents someone else from filing a tax return using your Social Security number (SSN) or individual taxpayer identification number (ITIN). The IP PIN is known only to you and the IRS. It helps us verify your identity when you file your electronic or paper tax return. Even though you may not have a filing requirement, an IP PIN still protects your account. SSA April 1, 2025: The Social Security Administration (SSA) Office of the Inspector General (OIG) is cautioning the public to be aware of emails that appear to be from SSA and include a link to download their Social Security statement. "Be on the lookout for fake calls, texts, emails, websites, messages on social media, or letters in the mail." Scammers have also been known to: • Use legitimate names of Office of Inspector General or Social Security Administration employees. • “Spoof” official government phone numbers, or even numbers for local police departments. • Send official-looking documents by U.S. mail or attachments through email, text, or social media message. Known Tactics Scammers Use These are red flags; you can trust that Social Security will never • Threaten you with arrest or legal action because you don't agree to pay money immediately. • Suspend your Social Security number. • Claim to need personal information or payment to activate a cost-of-living adjustment (COLA) or other benefit increase. • Pressure you to take immediate action, including sharing personal information. • Ask you to pay with gift cards, prepaid debit cards, wire transfers, cryptocurrency, or by mailing cash. • Threaten to seize your bank account. • Offer to move your money to a “protected” bank account. • Demand secrecy. • Direct message you on social media. We urge you to stay vigilant. If you are a victim of a scam properly report it, as well as let our office know. Advisory services offered through Osaic Wealth, Inc. Securities offered through Osaic Wealth, Inc. Member FINRA/SIPC. Securities offered through Osaic Wealth, Inc. member FINRA/SIPC. Osaic Wealth is separately owned and other entities and/or marketing names, products or services referenced here are independent of Osaic Wealth. Heritage Harbor Financial Associates and Osaic Wealth, Inc are separate entities.

With the April 15th tax deadline behind us, it’s time to shift our focus from tax preparation to post-tax season strategies that can enhance your financial well-being. While the pressure of filing taxes may have subsided, there are still important steps you can take to optimize your finances & prepare for the future. Here are some essential strategies to consider now that tax season has come to a close: Review Your Tax Return & Plan for Next Year Reviewing your current tax situation may help you identify potential tax-saving opportunities for the upcoming year. Organize Your Financial Records Use the post-tax season period to organize your financial records and documents. Proper record-keeping is essential for tax compliance and financial planning. Create a system for storing and managing your financial documents, including receipts, statements, and tax returns, to ensure easy access when needed. Consider Tax-Efficient Investment Strategies Explore tax-efficient investment strategies that can help minimize your tax liability and maximize your after-tax returns.

As we enter 2025, it’s the perfect time to set goals and establish a financial game plan for the year ahead. Whether it's adjusting to a new salary, planning for big expenses, or refining life goals, now is the ideal moment to lay the groundwork for success. To help start the year strong, here’s a roadmap to organize your finances and set yourself up for a prosperous year. 1. Build a Small-Scale Budget Begin by understanding your household’s monthly expenses. Establish a budget—whether detailed or loose—that accounts for your monthly spending. This foundational step is crucial for maintaining healthy, sustainable finances . 2. Plan for Big Expenses Anticipate non-regular expenditures like vacations, kids’ camps, home projects, and charitable contributions. Estimate the total cost of these items for the year and create a plan to fund them using monthly income or year-end bonuses. 3. Adjust Your Savings A new year often comes with changes to your income. Dedicate a portion of those additional funds to retirement savings. Even small increases, such as raising your 401(k) contribution by 1%, can make a significant impact over time. Incremental changes are often easier to sustain and can lead to meaningful progress. 4. Plan for Bonuses If you’re fortunate enough to receive a bonus, decide how to allocate it before it hits your account. Having no plan often leads to wasted opportunities. Use bonuses strategically for savings, debt repayment, or planned expenses. 5. Organize for Tax Season Tax documents will soon start arriving. Keep them organized to streamline your preparation process. If you pay quarterly taxes, plan accordingly. For those with significant non-qualified investment accounts, prepare for potential capital gains taxes following a strong year in the markets. 6. Tackle High-Interest Debt Destructive debt, such as credit card balances with high interest rates, requires immediate attention. Create a detailed plan to pay it off aggressively. Unchecked debt can derail even the best financial plans, so prioritize eliminating it. 7. Set a Big Financial Goal Identify one major financial objective for the year—whether it’s paying off debt, reaching a specific savings milestone, or achieving another significant target. Write it down and review it regularly to stay motivated. 8. Address Long-Overdue Tasks Choose one neglected financial task to tackle this year, such as drafting a will, purchasing life insurance , or updating an estate plan. Write it down and commit to completing it. As the new year begins, these steps can help pave the way for a healthier financial future . Here's to making progress, staying focused, and striving for incremental improvements throughout 2025! Wishing everyone a happy, healthy, and prosperous New Year! © 2025 Forbes Media LLC. All Rights Reserved This Forbes article was legally licensed through AdvisorStream. By Andrew Rosen, Contributor Advisory services offered through Osaic Wealth, Inc. Securities offered through Osaic Wealth, Inc. Member FINRA/SIPC. Securities offered through Osaic Wealth, Inc. member FINRA/SIPC. Osaic Wealth is separately owned and other entities and/or marketing names, products or services referenced here are independent of Osaic Wealth. Heritage Harbor Financial Associates and Osaic Wealth, Inc are separate entities.

Markets are ever-changing, and though downturns may capture headlines, the S&P 500® Index has historically enjoyed more positive years than negative.

>Why is Life Insurance worth it? There are many answers to the question of why is life insurance important. But by and large, the most important one is ensuring your family’s financial security and peace of mind. If anyone depends on your income, they would most likely struggle if you were to pass away. That’s why life insurance is so important to have. There are different types of life insurance policies, but essentially they all pay cash to your loved ones when you die. Money from life insurance can be used to cover daily living expenses, a mortgage or rent payments, outstanding loans, college tuition and other essential expenses. Life insurance is the best way to ensure that your loved ones would be in a good financial place if you and your income were no longer in the picture. >What does Life Insurance cover? ...Anything! Some examples include... Immediate Expenses Funeral and burial costs Uncovered medical expenses Mortgage or rent Car loans Credit card debt Taxes Estate settlement costs Ongoing Expenses Food Housing Utilities Child care Transportation Health care and insurance Continue a family business Future Expenses College costs Retirement >Do I need Life Insurance? If someone depends on you financially, you are most likely someone who needs life insurance. Life insurance provides cash to your family or loved ones after your death. This cash, known as the death benefit, replaces your income and the many non-paid ways you support your household. Your family can use this cash to pay for expenses like funeral costs, a mortgage, college tuition and more. Just a few examples of people who often answer “yes” to the question of “Should I get life insurance?” include: Married or partnered couples Many partners find it difficult to make ends meet without the other earner’s income in the picture. Married or partnered couples with kids In addition to losing one partner’s income, the surviving parent may have to pay for childcare and more without the other parent around to pitch in. Single parents As the sole income earner for your family, you’ll want to think about how to replace your child’s only source of financial support. Stay-at-home parents From cooking meals to shuttling kids to school to helping with homework, stay-at-home parents perform many critical responsibilities that would be costly to outsource. Empty nesters Many surviving partners would not be able to maintain the lifestyle they worked so hard to achieve without life insurance. Retirees Depending on the size of your estate, your heirs could be hit with an estate-tax rate of up to 45%. Fortunately, cash from a life insurance policy gives heirs access to tax-free money to pay for immediate costs and more. Business owners Life insurance can help your business in many ways if you, a fellow owner or a key employee were to pass away >How often should I review my Life Insurance policy? As a general rule of the thumb, it’s a good idea to touch base with a financial professional at least once a year or whenever a life change happens. A life insurance review will help ensure your coverage is at the right level to protect your loved ones. >How does a Life Insurance policy pay out? In most cases, the life insurance pay out is a lump sum paid to beneficiaries when the policyholder dies. To receive the life insurance pay out, you will have to file a claim with the insurer. They will need a certified copy of the death certificate in order to process the claim. Information from: https://lifehappens.org/life-insurance-101/ Advisory services offered through Osaic Wealth, Inc. Securities offered through Osaic Wealth, Inc. Member FINRA/SIPC. Securities offered through Osaic Wealth, Inc. member FINRA/SIPC. Osaic Wealth is separately owned and other entities and/or marketing names, products or services referenced here are independent of Osaic Wealth. Heritage Harbor Financial Associates and Osaic Wealth, Inc are separate entities.

Article by Business Insider: Tessa Campbell and Paul Kim. July 30, 2024 A 401(k) account is an employee-sponsored retirement vehicle that allows you to contribute pre-tax income toward your retirement. As one of the best retirement plans for US employees, a 401(k) lets you reduce the amount of income you're taxed on and lets your funds grow tax-free. Every year, Vanguard analyzes account data from millions of retirement accounts in a report titled "How America Saves." Knowing the average 401(k) balance by age group and income level can help you determine how much you need to retire. Here's the average 401(k) account balance based on age in 2024. Understanding the average 401(k) balance in 2024 According to Vanguard's annual data report, the average 401(k) account balance in 2024 was $134,128, an increase from 2023's average balance of $112,572. Across these accounts, the typical account balances vary widely by the method used to calculate it — while the average 401(k) savings balance is well over $100,000, the median account balance is much less at $35,286, according to Vanguard's latest data. The Vanguard data is broken down by demographics, showing a wide range of average account balances across various age ranges, income levels, industries, and genders. Here's a breakdown of those balances. Average 401(k) balance by age Retirement savings grow with compound interest, which means account balances increase with time. Like other types of retirement accounts, money saved in a 401(k) grows like a snowball, with interest earning interest on itself. The older you are, the more time you've had to build up your savings. With compounding interest, the earlier money is put into an account, the more opportunity it has to grow and the greater the possible returns. In retirement accounts like 401(k)s, building retirement savings early means a greater opportunity for growth. In 2024, employees can contribute up to $23,000 in their traditional and Roth 401(k). Folks aged 50 or older can contribute an additional catch-up contribution of $7,500 in 2024. According to Vanguard, here's the average amount people have saved for retirement by age group.