Susan Kaplan

Taking full advantage of Social Security benefits is an important part of any retirement income strategy. Yet how best to do so is often difficult due to the federal program being complicated and difficult to understand. Misconceptions are common and widespread, and competing points of view also exist as to when Social Security should be taken, but don’t get confused – below we explain what’s true and what is a myth.

Myth 1: Social Security benefits won’t be there when I retire.

The solvency/insolvency of the Social Security program is an ongoing topic of conversation these days. Insolvency means that the trust fund is unable to pay 100% benefits. It does not mean that Social Security will be completely eliminated and unable to pay any benefits, and pay them on time. Future benefits may only be paid from taxes collected, rather than reserves, which would cover roughly 80% of benefits.

Myth 2: Social Security will be a major source of retirement income.

Social Security benefits are just one piece of the puzzle when planning for retirement. Social Security alone is not likely to provide enough income for most people, especially taking into account escalating medical bills. Social Security benefits should be incorporated into your overall planning and budgeting, just like RMDs, and can be a helpful supplement to other income sources.

Myth 3: Social Security benefits don’t keep up with inflation.

Social Security payments are actually designed to keep pace with the rise in cost of living. Every year the Social Security Administration evaluates inflation data and responds accordingly. You may have received a notice regarding the new cost of living adjustment – which was 2.5% – which became effective in for 2025.

Myth 4: You will outlive Social Security.

It is not possible to outlive Social Security. Once you choose to start benefits, you will receive a payment every month until your passing. If your spouse survives you, and receives their own benefits, they will receive the higher of the two amounts, but cannot receive both. Generally, if you are the surviving spouse and don’t have your own Social Security retirement benefit, you could be eligible to receive a spousal benefit of 50%. More here: https://www.ssa.gov/survivor

Myth 5: I should claim my Social Security benefits as soon as possible.

Depending on your birthday, the “Full Retirement Age,” or the point at which you’re eligible for your full, unreduced retirement benefit, will fluctuate. You are allowed to begin taking Social Security as early as age 62, or as late as 70. However, the longer you wait, the higher your monthly benefit payments will be. The maximum benefit amount will be reached if you hold off until age 70, and this is what many retirees choose to do. But this may not be the best choice for everyone, so talk with your TFG Financial Advisor to determine the best time to begin taking benefits.

Myth 6: Social Security income isn’t subject to taxes.

You may need to pay taxes on your benefits, even though they are paid out by a government program. Up to 85% of your Social Security benefits may be taxable, depending on whether you are still working, or you receive income from other sources. If this is the case, your monthly Social Security benefits can be temporarily reduced if you are working and receiving benefits before your full retirement age (FRA), if your earnings exceed a certain annual limit.

Contact us: Misinformation is everywhere, especially on the internet. Whether retirement is close at hand or far into the future, be sure to have a conversation with your TFG Financial Advisor to create a sound strategy for your retirement, which includes when to take your Social Security benefits. Reach out to us at 561-209-1120.

Turbulent market conditions can make any investor nervous, but the stock market is constantly fluctuating, which is quite normal over periods of time. Any number of factors may cause its rise or fall: global issues, economic news, industry up-turns (or down-turns). So, in the ever changing financial landscape that long-term investors face, what are some things you can do to help increase the likelihood of maintaining your portfolio’s earning stability? Here’s some suggestions:

1. Keep your portfolio diversified.

Managing risk by spreading it out over different types of assets is one of the best strategies. Diversifying based on asset class and market sector are two ways to do this. It is important to note that every investment includes risk, and diversifying will not eliminate risk entirely, but it can help to cushion the blow when markets dip. Stocks, bonds, commodities, and other asset classes each play a unique role in your portfolio. Rebalance your portfolio as needed when market changes skew your allocation from its original target.

2. Assess your risk tolerance on a regular basis.

At different stages of your life, the amount of risk you can tolerate or afford to take will shift. Generally, folks are willing to take more risk investing when they are younger, and as retirement approaches, this risk tolerance will decrease. Periodically assessing your risk tolerance and adjusting your portfolio accordingly can help you to transition through various phases of life, as well as protect your nest egg as you grow older. Consider including defensive assets for more stability as time goes on.

3. Focus on the long-term perspective.

When it comes to the stock market fluctuations, avoid panic selling. Downturns happen, and bear markets are often short lived. Selling during a downturn can lock in losses. Depending on your investment goals, investing in quality companies with strong financial statements and consistent performances can add a layer of protection.

4. Tap into tax efficiency.

There are a number of tax-efficient investment strategies you can employ, and tax-loss harvesting is a good option. This allows you to offset gains with losses to minimize your tax liability by selling investments that are down in value to offset profit from other investments. There are rules and exceptions, so have your TFG Financial Advisor guide you.

Reach Out to Us: Concerned investors can ease their worry during market turbulence by understanding asset allocation, diversification, cash flow needs, and risk tolerance before making any changes to their portfolio. Talk with a TFG Financial Advisor about revisiting their financial goals or asset allocation. Every investment includes risk; an advisor can educate you about strategies to minimize risk and tax, how to set up a portfolio from a long term perspective, and what makes sense in regards to your unique situation. Call 561-209-1120 to set up an appointment today.

Did your Sixties sneak up on you? No matter where you are in your financial journey, there are ways to turbo charge your investment strategy to provide for your retirement years. Whether you completely retire to pursue your passions and spend time with Grandkids, or continue to work on a full or part time basis to continue contributing to your nest egg and fund your pastimes and pursuits, you should have a retirement plan in place. You may be an empty nester ready to downsize or relocate, or a successful entrepreneur who just sold their business with money to burn on a vacation home or expensive car, either way it is never too late to draft a retirement plan or improve the one you already have in place.

Just Getting Started In Your Early 60s?

• Working in Your Retirement Years: With longevity increasing for both men and women, it is never too late to create a retirement plan, and the sooner the better if you have nothing already in place. Age limits and thresholds for retirement plans have changed recently and RMDs are delayed, which encourage folks to continue to work if they are able. The longer you keep working and earning a paycheck, the easier it is to start a savings plan and stick to it. More information on the pros and cons, tax risks and Social Security effects of working during retirement age here.
• Stay Debt Free: Debt and loan payments are going to decrease how much you are able to put away for retirement, getting these out of the way as soon as possible will be very important. Come up with a monthly plan to minimize expenses, and pay off high interest debt first. Consider downsizing your home and lifestyle in order to have more funds available to save and invest.
• Ask an Expert for Help: No matter how close you are to retirement, you can still prioritize saving for it. Don’t waste valuable time and assets making mistakes, talk to a financial advisor who can help you calculate your savings goal and create a customized, realistic savings plan and investment strategy. Get educated on the right choice for you, whether stocks, bonds, CDs, or annuities, etc.

Have a Nice Nest Egg but Worried if it Will Last?

• Plan for Longevity: Use a range of financial options to help you grow your wealth while also protecting you from common risks like taxes, market volatility, inflation, and even the risk that you will live longer than expected.
  • Using a mix of Roth and traditional accounts can help you manage your taxes, both as you’re saving for retirement and when you withdraw funds in retirement. Be sure to make allowed catch-up contributions. Look at a Roth Conversion with the help of your TFG Financial Advisors professional to time the conversion so it occurs in the most tax-efficient way possible.
  • Whole Life Insurance can help protect your family and also accumulate cash value that can become an important part of your retirement plan. The cash value is guaranteed to grow and is unaffected by the markets, protecting against market volatility. (Remember that using cash value to supplement retirement income will reduce the death benefit.)
• Review Your Investment Strategy: As you approach retirement, the allocation of your assets may need to change. You may need more diversification, making sure your portfolio isn’t overly weighted in company stock. You may want to re-allocate your portfolio and shift the balance to more conservative assets can help protect against the risk of market downturns. Your TFG Financial Advisors professional can help you balance the need for long-term growth with the need for income generation and stability.
• Be Smart About Social Security: You are allowed to delay taking Social Security benefits up until age 70. By waiting, you can increase your benefit amount up to 8% a year. Just because you’re eligible to collect Social Security doesn’t mean you should. Receiving Social Security before you reach “full retirement age” results in a reduced benefit for life, BUT delaying payments increases your payout permanently.

• Review Tax Liabilities: Make sure that as you take RMDs or other withdrawals from retirement accounts as needed, they are done in the most tax efficient way possible. Time Social Security advantageously, and tax-loss harvesting techniques, use capital losses to offset gains. Explore options to further minimize taxes such as charitable giving, gifting to loved ones, using trusts to minimize estate taxes, 1031 exchanges etc.

Reach Out to Us: Our wealth managers and financial advisors work with you to develop a retirement plan that makes the most of your hard-earned money.  We can help you minimize your tax liability, prepare for cost of living increases, navigate required minimum distributions (RMDs), update your estate plan, protect wealth for future generations and much more. We realize your retirement plan will need to change as your life and priorities change, so we’ll communicate often, and review it with you to adjust your portfolio and investment strategy as needed.

Whether male or female, folks in their 40s and 50s are likely well-established in their careers, with college bound children on the horizon, and maybe a vacation home in their sights. Retirement planning starts to take on some urgency during this period, and long-term goals should be revisited for relevancy.

Make sure your 40s and 50s are full of memories and milestones. To avoid a mid-life financial crisis, here are a few suggestions to help navigate financial waters during this period:

Protect Your Family: Look into short term and long term disability insurance, and check the status of your emergency fund. When you have others that depend on you, consider life insurance which can be an important addition to your financial plan. Certain types of life insurance also build cash value, which can help you grow funds that you can access throughout your life.

Prioritize Retirement Planning: Maximize your contributions to any workplace retirement plan or IRA. Take advantage of catch-up contributions when you can. Know the benefits of a Roth vs a regular retirement plan, and the circumstances under which it would benefit you most. For more information, read our past article about these differences here. Look into a cash balance plan if you are a small business owner. Also consider a health savings account if you have access to one, contributions grow triple tax free.

Build a Portfolio: If you haven’t already, it may be time to turn accrued cash sitting idle, or in a short term account tied to interest rates, into an investment account which would support the growth of long term goals and wealth accumulation. Did you know portfolios can be custom tailored for your needs? Talk to a TFG Financial Advisors professional about your options, asset allocation, diversification and risk tolerance.

Save for College and Higher Education: 529 Plans are the best vehicles for funding your children’s education, the earlier you start the better. A 529 plan can be set up for a beneficiary of any age and anyone can contribute to this account. Earnings grow tax free. When used for qualified education expenses, distributions are federally tax free. TFG Financial Advisors can easily help you set up a plan. More info here.

Consider Estate Planning: Now is an ideal time to figure out who you would like to name as your Power of Attorney and what kind of legacy you’d like to leave behind. Consider both current and projected needs for your family. Working up an estate plan will ensure that your wishes for your money and your health are carried out. Your loved ones will need to know where financial accounts are and how to access them if needed. It is important to your will and beneficiaries up to date, review annually. If you own a business, be sure there is a “buy/sell” agreement in place and create a business exit strategy to preserve the wealth within your business and transfer it to your family.

Longevity’s Unique Impact on Women: With longer lifespans comes the increased risk of widowhood, and possibilities of divorce, many women will find themselves navigating the financial complexities of aging alone, and with reduced income on which to draw. The seeds of financial independence need to be planted now to prevent outliving your nest egg in later years. Proactive financial planning for women has never been more important, here are a few suggestions for this stage of your life:

• Plan to Live to 100: To be sure your nest egg is adequate, work with an advisor to assess lifestyle needs through age 100, and be proactive. If you are still working, maximize contributions to retirement accounts, and ensure you have incorporated health care planning, medical spending, long term care and life insurance into your plan.
• Protect Your Future Income: Work with your TFG team to examine what sources of income you could tap for retirement. This could include your IRA, 401(k), investment accounts, annuities, the cash value of any life insurance policies or other assets that could produce income in retirement.
• Be Tax Efficient: A financial advisor can help you determine how to draw down from your assets in a tax-efficient way. They can look at your entire retirement portfolio and create a drawdown strategy that takes your goals, taxes and other retirement risks into account.

Reach Out to Us: A financial strategy demands ongoing care; it’s not a one-time arrangement. With the guidance of TFG Financial Advisors professional, you can continually adapt and refine your financial plan to accommodate shifting priorities and circumstances as you age, ensuring you remain on course to achieve your goals and financial security later on.

Your 20s and 30s can be an exciting time!  College is behind you, you’re working full time, learning on-the-job skills, and the thought has probably crossed your mind that it might be time to learn some financial skills as well.

In your 20s, you are beginning to build a life on your own, in your own place, and become financially independent from your parents. What should your primary focus be? Here are some steps to follow today on your journey to building a firm financial foundation tomorrow:

• Establish a Budget: You have probably heard this one a thousand times by now, from just about everyone you know. But one more time never hurts. Having a budget will help you identify income and expenses, and better monitor your cash flow. A simple spreadsheet will show where your money goes, allowing you to direct funds to necessities and needs vs. impulsive purchases. It will also allow you plan ahead, and put a little aside in an emergency fund for unexpected circumstances.
• Repay Debts on a Monthly Basis: Nothing racks up more debt than interest charges you have to pay on obligations you already have. If you have student loans from school, or large credit card payments not fulfilled, now is a good time to set up a payment plan. Even monthly payments that reduce the debt will help you make significant progress. Take advantage of balance transfer deals when you can to significantly lower an interest rate. To avoid late charges, pay minimums on all your loans, but devote extra payment to the highest interest rate loan. Be careful taking on new debt before you put a big dent in what you already owe. You need to monitor your credit rating.
• Contribute to Workplace Retirement Plans: Now that you have a full time position, see if your employer offers a 401(k) or other retirement plan, take advantage of it, even if it is just a small portion of your paycheck. If there is no workplace plan, open an IRA for yourself and contribute every paycheck. Compounding will snowball over the years and give you a head start on retirement saving. (Compounding is the process in which an asset’s earnings, from either capital gains or interest, are reinvested to generate additional earnings over time).
• Get Health Insurance: You may develop health issues even at a young age; making sure you are covered by health insurance may save you from drowning in medical debt. Check with your employer to see what the company offers as far as health benefits go, and if the plan does not fit your needs, visit the health care marketplace for options.

For people in their 30s, your goals will be changing as you move ahead in your career, start a family, or look to buy your first home. By now you should have established good financial habits to build on (see above). Here are some suggestions to help you continue to plan for the future, and make your goals a reality:

• Understand Your Net Worth: After you begin to formulate your goals, it is important to understand what your current financial snapshot looks like. Add up your income and assets and subtract your liabilities and fixed expenses. Now is the time to continue saving and growing your money to help meet those goals.
• Increase Savings as Wages Increase: When you receive a promotion, or transition to a higher paying job, make sure that you are increasing how much money you save. Use a portion of your new wages to continue to reduce bad debt which will help grow your net worth. Good debt tends to involve lower interest rates and is typically used to reach a major goal or milestone, a mortgage is an example of good debt. Bad debt carries higher interest rates and is often used to finance purchases that don’t provide much value back to you, high credit card balances are an example of bad debt.
• Consider an Investment Strategy: By now you have begun saving for retirement through a workplace 401(k) or an IRA. Perhaps it is time to start putting money into an investment account to save for big, long-term goals. Like a retirement account, an investment account will help your money grow over time. Now is a good time to learn investing basics and fundamentals to make sure that you’re putting away the right amount in the right places based on your goals. TFG Financial Advisors can help you

• Establish an “Important Financial Papers” file: Proper record keeping is very important as your family grows and your investments do too. Pick a safe location for a digital file containing important records, accessible in case of emergency. Be sure in include: Wills, Trusts, Estate Plans, Power of Attorney, Life insurance, Retirement Accounts, Real Estate Deeds, Investment and Bank Statements, 529 Plans. etc. Remember to review documents and beneficiaries regularly, especially after any milestones or important life changing events.

Reach Out to Us: Financial planning is about prioritizing what is most important to you and making a plan to get there. No matter what your age, it’s essential to review your current financial situation, including your savings, investments, insurance coverage, and assets as well as any outstanding debts. After you’ve gathered all your financial details, a TFG Financial Advisors professional can help pinpoint areas that require attention, and help you create a plan in order for you to reach your goals.

A Republican majority in Washington may bring an extension of key provisions of the Tax Cuts and Jobs Act, but further tax cuts may be difficult in light of fiscal concerns such as a burgeoning budget and shrinking revenue.

Due to significant financial impact should certain provisions “sunset,” we are urging clients to have a conversation with their Financial Advisor regarding estate planning in the year ahead as well as for the future. A “wait-and-see” approach runs a significant wealth-preservation risk: loss of the $14 million additional exemption for married couples or $7 million for individuals that is available today.

To mitigate that risk, and to avoid any rushed planning towards the end of 2025, clients looking for flexibility as the deadline approaches may wish to do their planning now and ready any necessary documents for transfers of property towards the end of 2025, when the fate of the TCJA may be more apparent.

The Internal Revenue Service has issued an “anti-claw-back” regulation that protects taxpayers from being penalized for using their exemption during their lifetime. Under this regulation, any exemption used during life will be viewed as final. Thus, if the exemption were to decrease in subsequent years, the IRS would not impose a tax on the prior gifts, nor claw assets back into the taxpayer’s estate.

Current exemption levels for estate, gift, and GST taxes may remain at $14 million for each spouse and double that per couple, the question is, how will the government pay for this? Elimination of green energy tax credits? Tariffs on imported goods? Most likely a “claw back” of recently committed IRS funds. Any choice will have a ripple effect and change where you might look to invest as well as the dollars in your pocketbook. FYI – the corporate income tax rate was reduced by the TCJA, from 29% to 21%, and is a permanent change not subject to sunset.

Ideas floated on the campaign trail included elimination of tax on Social Security, tipped wages, and a reduction of the corporate tax to 15%. Again, how would the government make up that revenue, when already suffering from an increase in debt that is now 124% of GDP? Taxes may actually have to be increased to curb annual deficits and growth of the national debt.

Wealth planning strategies we suggest:

• Annual gifting as part of an annual plan of “lifetime giving.” When gifting an asset with appreciation potential to an individual or trust, like stock or investment real estate, you remove the appreciation and income from your tax base for the year of the gift, as well as future years.
• Tax loss harvesting to offset gains that would be taxed at current rates, (or potentially higher ones).
• Postpone sales of capital assets to later years that would be taxed at potentially lower capital gain tax rates.
• Strategically manage income tax brackets overtime by increasing portions of your income while tax rates are still low,
  • Review deferred compensation elections,
  • Consider partial or total conversions of IRAs to Roth IRAs.
• Look for more tax diversification for future income sources, and
• Accelerate the purchase of imports for personal/business use to avoid higher prices due to tariffs.

Reach Out to Us: The current estate and gift tax exemption amount offers a unique window of opportunity for estate planning, but it may sunset, and then a significant portion of it may be lost. The first step is to contact your TFG Financial Advisors’ professional as soon as possible to discuss your existing estate plan and unique circumstances. At the very least, be sure revocable and irrevocable trust documents account for estate taxes, and the future growth and appreciation of assets. Those with larger estates may wish to take advantage of advanced planning strategies that remove assets from the taxable estate, or deploy discounting strategies to reduce the taxable value of their estate. When giving annual tax free gifts, be sure to consider the beneficiary’s tax liability; the benefit to you comes at the cost of the recipient receiving the asset with your cost basis.

TFG Financial Advisors, LLC, is registered as an investment adviser with the SEC. Registration is not an endorsement of the firm by securities regulators and does not mean the adviser has achieved a specific level of skill or ability. The firm is not engaged in the practice of law or accounting. All expressions of opinion reflect the judgment of the authors on the date of publication and may change in response to market conditions. You should consult with a professional advisor before implementing any strategies discussed. Content should not be viewed as an offer to buy or sell any of the securities mentioned or as legal or tax advice. You should always consult an attorney or tax professional regarding your specific legal or tax situation. Tax rules and regulations are subject to change at any time. All investment strategies have the potential for profit or loss.