The start of a new year has always given us an opportunity for a new beginning or a clean slate. I am sure many of you would agree that we need that opportunity more than ever in 2021. Last year through all of us for a loop. So many events, social plans, and trips went from plan A, to plan B, then C, and, in most cases, finally canceled. Your business or job could have also been adversely impacted. Paycheck Protection Program (PPP) loans and stimulus checks came to the rescue of some, but not all. Let’s face it, most of your plans for 2020 likely fell apart. However, if you had a financial plan at the beginning of the year, it may have been one of the few things in your life that did not get canceled. In fact, it likely received some heightened attention and maybe even a bit of fine-tuning. We like to remind clients that all times are uncertain; however, some periods feel a bit more uncertain than others. Yep!
That describes 2020. In any event, it is always prudent to adhere to a well-thought-out plan that aligns with long-term objectives and risk tolerance. Maintaining a long-term mindset helps us stay invested during bear markets and reminds us not to get overconfident and take undue risks in bull markets. Staying the course through challenging economic conditions, changing political landscapes, or whatever the world can throw at you is what having a plan is all about.
So, if your plan for 2021 is, “No plan at all, because what’s the point,” think again! This could be your year to start working with an advisor to create a financial plan. While we agree that any plan is better than no plan at all, we recommend working side-by-side with an advisor who will act in your best interest and will consider all aspects of your financial life. Choose an advisor who will take a holistic view in creating your plan and will help you to understand how each piece of the puzzle interacts with others.
Taxes, retirement, saving for college, Social Security and Medicare considerations, estate planning, and gifting strategies are just some of the many “puzzle pieces” that you may need to consider. An all-inclusive plan can bring all these concepts together and help to guide decisions for an optimal and tax-aware investment plan. Many investors have multiple accounts such as IRAs, Roth IRAs, and taxable accounts. Careful thought into asset placement can help optimize after-tax returns for an investor. A holistic view will also allow for considerations of capital gains, tax-loss harvesting, and thoughtful rebalancing in relation to other non-investment income sources.
Like anything in life, considering all the pieces of the puzzle can get complicated; however, it’s achievable with a plan. Let us help you in 2021!
Scott Brubaker, Partner Hayashi Wayland Investment Services “Hayashi & Wayland Investment Services, LLC is a state registered investment adviser. We are providing this article for informational purposes only. It should not be considered investment or financial planning advice and the information should not be solely relied upon when making any investment or financial planning decisions. For details on our services and fees, please review our disclosure brochure at www.adviserinfo.sec.gov.”