Search Results for: estate plan

Oct 15

Financial Planner or Estate Planner: Which Do You Need?

By Anna Byrne | Financial Planning , Retirement Planning , Tax Planning

Financial Planner or Estate Planner: Which Do You Need?

Financial Planners and Estate Planners are two different professions that are often confused. There is some overlap between professionals in these fields, but their roles are rather distinct. When you are striving to make a long-term plan for a strong financial future, both financial planners and estate planners play a crucial role.

In fact, when you consider some of the most recent personal finance statistics, it becomes very clear that many Americans could really benefit from retaining the services of both a financial planner AND an estate planner. For instance, 33% of Americans have no money saved for retirement, 60% lack any form of an estate plan, and only 46% have money saved for emergencies. Better planning starts with understanding what both types of planners do.

What is a Financial Planner?

A financial planner is a professional who offers a wide range of services that can assist both individuals and businesses to accomplish their long-term financial goals and accumulate wealth. They fall into two categories:

  • Registered Investment Advisor
  • Certified Financial Planner

Certified Financial Planners (CFP) are required to comply with the Certified Financial Planner Board of Standards, which means they have a basic level of expertise backed by a larger organization. Ethically they have to work in your best interest.

Services provided by both financial advisors and CFPs include:

What is an Estate Planner?

The goal of a financial planner is to assist with wealth accumulation. On the other hand, an estate planner can help you to make financial plans associated with your passing, which includes protecting the wealth that you have accumulated .

While you might believe only wealthy individuals need to work with an estate planner, you should consider the fact that everything you have accumulated in your life comprises your estate. Accumulated assets such as vehicles, furniture, bank accounts, life insurance, your home, and other personal possessions are all included in your estate.

Your assets become the property of the state if you die without a will or an estate plan in place , and your family members will not be able to claim them without paying legal fees and taxes. They will also have to face the stress of potential disagreements with other family members over how your property should be divided.

Besides planning for your passing, estate planning also involves creating a clear plan for your care if you become disabled , and it also covers naming guardians for underage children. Estate planning is a way to protect your family and your assets while reducing taxes and legal fees .

Which Do You Need?

The roles of financial planners and estate planners are unique, and for this reason, you will benefit from working with both . While your financial planner helps you accumulate wealth, he or she can also prepare you for a meeting with an estate planner as part of your long-term strategy. This includes providing the estate planner with lists of beneficiaries, tax return documentation, lists of investments and a breakdown of income and expenses.

When you work with both a financial planner and an estate planner, they will keep you accountable by periodically reviewing your documentation and beneficiaries and making sure everything is updated and reviewed as necessary. By taking the time to work with both these professionals, no important decisions will be overlooked, and you will take control of your financial future.


Note: This article was authored by Kristin Dzialo, a partner at Eckert Byrne LLC, a Cambridge, MA law firm that provides tailored estate planning. Eckert Byrne LLC and Insight Financial Strategists LLC are separate and unaffiliated companies. This article is provided for educational and informational purposes only. While Insight Financial Strategists LLC believes the sources to be reliable, it makes no representations or warranties as to this or other third party content it makes available on its website and/or newsletter,  nor does it explicitly or implicitly endorse or approve the information provided.  

Jun 25

What Is Your Legacy Plan?

By Chris Chen CFP | Financial Planning

What Is Your Legacy Plan?

While it may not be pleasant to think of one’s own passing, having your affairs in order can help ease the burden on friends and family, when the time comes, and can contribute to your own peace of mind knowing you have done all you can to prepare. There are many factors that should be considered when trying to create an effective and comprehensive legacy plan. Some considerations include:

  • Instructions on your own care in sickness
  • Guardians for your minor children should both parents pass
  • Protection from creditors
  • Charitable contributions
  • Continuation of a family business
  • Reducing or eliminating tax
  • Maintaining family harmony
  • Legacy creation and support of future generations

In addition, all these factors should integrate appropriately with your retirement income planning and your investment decisions.

Even if you already have a legacy plan in place, you may want to conduct a review. Decisions made years ago may not accurately reflect your current wishes. Legacy plans are not for the significantly wealthy alone. If you have children in your care or a business you wish to leave to future generations, it is important that protections and guidance are put in place now and are not put off until your retirement years. It is always a possibility that you may not have the luxury to last throughout the entire life expectancy table.

A poorly executed legacy plan, or the lack of one at all, could leave those you most care about to suffer needlessly in your absence. Be sure to work with a CFP™ professional or another experienced professional to gain control of your estate plan.


The preceding content was originally published on the Financial Planning Association © Web site,


Aug 06

What to Expect Financially When Expecting

By Jason Berube | Financial Planning

What to Expect Financially When Expecting

Recently two of my closest friends and their wives became expecting parents. Of the two couples, one is expecting for the very first time. This very happy news inspired me to write this post to share my experiences as both a parent and a financial planner.  I would like to share my insights with becoming a parent for the very first time and getting a chance to understand and become competent at the financial aspects of parenting. 

Going down the path to parenthood, a thrilling moment in a relationship is quickly followed by the sobering realization of the costs involved in raising a child.

Many people receive help from family, friends and baby showers in accumulating the initial items needed such as furniture, baby equipment, and newborn clothes. This assistance may ease some of the immediate financial burdens but the ongoing cost of diapers, food, toys, and childcare can be a staggering expense.

What is less apparent at first is that non-child related expenses may be reduced. Many parents stay home more to take care of the baby, which means they have less time to go out and spend money on restaurants, bars, entertainment, and travel!

I am often asked what is the biggest financial expense that new parents should anticipate. I have found from my own experience is that most parents’ budgets will adapt to accommodate the new needs and replace old ways of spending. 

If you are a new or expecting parent, here are some suggestions on how you can take action now to prepare your financial life for your new way of life.

Set Up An Online Automatic Savings Account

The best way to prepare for increased expenses is to start making monthly contributions, before the baby arrives, to a savings account dedicated to baby-related costs. When goal-setting, it is often a good idea to establish different savings accounts for each goal like a vacation, buying a new house or, in this instance, saving for the ongoing cost of providing for a child. Having separate accounts can be a great way to keep track of how you organize your money. For example, if you have two different checking accounts, they can each have a different name, such as “Baby’s Expenses” and “Mom’s Mad Money” – or whatever you want! Putting aside money each month will benefit you in two ways. It gives you a chance to get use to the bigger cash outflows from your checking account and it also provides you with a nice cash cushion for baby-related expenses that you may have overlooked.

Create A Budget

Once you have children, finances have a way of becoming more complex.  That can be compounded by the fact that there is less time to keep track of everything.

New parents should consider creating a budget to keep their finances on track. One way is to create a “reverse budget”. It simply helps you to figure out how much you need to save, makes those savings automatic and then allows you to spend the remaining amount of money as you please. This process emphasizes using a regular and ongoing savings method instead of manual expense tracking, (a big plus when unexpected baby expenses arise). Once a reverse budget is set up, the entire thing is automated. 

From a financial planning perspective, a reverse budget forces you to write out your short- and long-term goals, which may be different now that a little one is on the way. And, you can use the same tool for other goals such as vacation or retirement.

Get Basic Estate Documents

Estate planning is a frequently overlooked task. Nonetheless, it remains very important for new parents to complete. There are five estate planning documents you should consider regardless of your age, health and wealth:

    1. Will
    2. Durable power of attorney
    3. Advanced medical directives
    4. Letter of instruction (LOI)
    5. Living trust (or revocable trust)

Creating a will is the most important step in an estate plan because it distributes your property and assets as you wish after death. Even more importantly, a will names legal guardians for your children in case both parents pass away while the children are still minors. 

Without a will that names a guardian for your children, the state you reside in will determine it for you.  That may not align with your wishes and creates needless anxiety.

Although, the other items in the list above are beyond the scope of this post, expecting parents should pay attention and review them, with a professional if you need to.

Figure Out Childcare Now

Whether you want to send your kids to daycare, hire a nanny, get help from grandparents or stay at home yourself, you need to get a plan in place soon.

The average cost of center-based daycare in the United States is $11,666 per year ($972 a month), but prices range from $3,582 to $18,773 a year ($300 to $1,564 monthly), according to the National Association of Child Care Resource & Referral Agencies (NACCRRA).

Most daycare centers require a non-refundable deposit. If you’re planning on using daycare, you should make a deposit at your daycare of choice as soon as possible!!!

Daycare slots will fill up quickly, so even registering for daycare just a few months before your due date can still leave you on a waiting list.

Hiring a nanny is not easy either. Finding someone you can trust, afford and fit in your schedule can be tricky. It is a little more difficult to secure a nanny as far in advance as a daycare center, but it is never too soon to begin looking so you can familiarize yourself with the important qualities and nuances of these relationships.

Long Term

It’s easy to remain focused on the joy (and anxieties) of the present. However, don’t forget the long term: although you may be overwhelmed by the excitement of a new addition to the family, you still have to steer your growing family into financial security for the long term.  

A new baby on the way is a great opportunity to check your long term financial plan. A bit like checking the air in your tires before a long trip. What to do for college savings.  How to prioritize retirement savings and investment. Dealing with the mortgage and other debt. And many other questions.

Consider Hiring A Financial Planner

If you’re feeling concerned about all the financial details involved in raising a child, just know that you’re going to do great! You’re planning ahead and getting prepared now, which will go a long way once your baby arrives.

But if you’re still worried, now may be the time to hire a financial planner, preferably a fee-only fiduciary. Hiring a professional frees up your time to do the other things you love most in life – including focusing on your growing family.

It can also help alleviate any stress your finances may cause because a really good financial planner will work with you to get your entire financial house in order and help you keep it that way forever.

Apr 15

McKenzie Bezos: 4 Wealth Strategy Concerns

By Chris Chen CFP | Divorce Planning , Financial Planning , Tax Planning

McKenzie Bezos: 4 Wealth Strategy Concerns

source: pexels

On April 4th, it was announced that McKenzie Bezos would be receiving 36 billion dollars worth of assets from her divorce from Jeff.  

First of all, congratulations to Jeff and McKenzie for keeping this divorce process short, out of the media as much as possible, and out of the courts. We are not going to know the details of the Bezos’ agreement. However, some information has been disclosed in the press.

As reported by CNN, McKenzie is keeping 4% of their Amazon stock, worth approximately 36 billion dollars. Jeff retains voting power for her shares as well as ownership of the Washington Post and Blue Origin, their space exploration venture. According to The Economist, this makes the Bezos divorce the most expensive in history by a long shot.

As a post-divorce financial planner, I feel a little silly thinking of what I would tell McKenzie to do with her money now. The magnitude of her portfolio is well beyond run of the mill high net worth divorces with assets only in the millions or tens of millions of dollars. McKenzie can buy $100M or $200M houses and condos wherever she wants. She can have her own jets and her own yachts. She could buy an island or two.

Unsurprisingly, McKenzie’s wealth is concentrated in AMZN stock. That has worked out well for the Bezos’ for the past several years. It is likely to continue to be a great source of wealth for both of them in the future. As it stands, McKenzie is now the third richest woman in the world. Who knows, if she holds onto AMZN stock, she could become the richest woman in the world one day! McKenzie’s concerns with budgeting, taxes, and wealth strategy will soon be in a class of their own.

There are, however, some lingering considerations for McKenzie, particularly when it comes to capital gains taxes, portfolio management, philanthropy and wealth transfer.

Capital Gains Taxes

McKenzie probably has an enormous tax liability built into her AMZN holdings. While I am not privy to her cost basis, it is not unreasonable to assume that it is close to zero since the Bezos’ have owned Amazon stock since the company’s inception. Should McKenzie sell her AMZN stock, the entire amount would likely be subject to capital gains taxes. As such McKenzie may not be worth quite $36 Billion after taxes are accounted for .

A benefit of keeping the stock until her death is that her estate will benefit from a step up in cost basis. This would mean that the IRS would consider the cost of the stock to be equal to the value at her death. This favorable tax treatment would wipe out her capital gains tax liability.

Portfolio Management

Nevertheless, the standard advice that wealth strategists give clients with ordinary wealth applies to Ms. Bezos as well: it would be in McKenzie’s best financial interest to diversify her holdings. Diversifying would help her reduce the risk of having her wealth concentrated into a single stock. It is a problem that McKenzie (and Jeff) share with many employees of technology and biotech startups.

McKenzie might not want to sell all of her AMZN stock or even most of it. Although we have not read their separation agreement, she has probably agreed with Jeff that she would retain the bulk of her holding. She may also believe enough in AMZN and Jeff’s leadership to sincerely want to keep it. Regardless, McKenzie should still diversify her portfolio to protect herself against AMZN specific risks.


An advantage of having more money than you need is that you have the option to use the excess to have a measurable impact on the world through philanthropy. In 2018, Jeff and McKenzie created a $2B fund, the Bezos Day One Fund, to help fight homelessness. Given that the home page of the fund now only features Jeff’s signature, this may mean that Jeff is keeping this also. McKenzie will likely organize her own charity. What will her cause be?

Philanthropy can be an effective tax and estate management tool , primarily because, within limits, the IRS allows you to deduct your donations against your income thus helping you manage current and future taxes. For McKenzie, it is about deciding what to do with the money, instead of letting Congress decide.

Wealth Transfer

McKenzie’s net worth is far in excess of the current limits of federal and state estate taxes. Unless she previously planned for it during her marriage, she will have to revise her estate plan.  Even though she would benefit from a step up in basis on her AMZN stock if she chooses not to diversify, she would still be subject to estate taxes, potentially in the billions of dollars.

Of course, no matter how much estate tax McKenzie ends up paying, it is likely that she will have plenty to leave to her heirs.

Financially, McKenzie Bezos has what wealth strategists would consider as ‘good financial problems’ . She has the financial freedom to focus on the important aspects of life: family, relationships and making a difference.


A version of this post appeared in Kiplinger on April 12, 2019

Nov 18

Wealth Strategy

By Chris Chen CFP |

Wealth Strategy

Many people think of wealth management as a synonym for investment management. If that's all it is, why not just call it investment management? The truth is that Wealth Management is a bit like beauty, it's in the eye of the beholder.

That's because families' wealth prospects are not just limited to investments. Of course, investments are important, but so are insurance, legacy planning, retirement, education planning, taxes and dealing with the transition aspects of divorce and retirement. Any financial factor that affects a family's wealth is part of wealth management.

Wealth management starts with you to assemble your life and financial concerns into an integrated wealth strategy that includes the various aspects of your finances. We work with your tax, legal, insurance and other professionals to ensure that all aspects of your financial life are addressed as comprehensively as possible.

Many of our clients live in Lexington MA, Arlington MA, Bedford MA, Concord MA, Newton MA, Boston, Brookline, Weston MA, Waltham, Cambridge MA, Belmont MA, Lincoln MA, Watertown, Wellesley, Winchester MA.

Mar 27


By wpadmin |


If you would like to discuss views on the economy, financial planning, or sustainable investments, please schedule time here

If you are considering using Annuities as a way to fund your retirement, you should read Chris's thoughts about it here

Have your ever wondered what makes a retirement plan a Pension versus a 401(k) or 403(b)? Investopedia provides specific detail about each type of plan along with ​Chris's guidance

Annuities can be a complex and often misunderstood retirement savings tool.  Chris discusses the pros and cons of annuities here

Personal longevity is an important factor to consider in retirement planning.  Chris mentions the challenge of determing client longevity here.

When young adults get into debt, they may choose to use the funds in their 401k plan to repay it.  Find out what Chris thinks is a better option for repayment here


McKenzie Bezos: 4 Wealth Strategy Concerns

Just recently McKenzie and Jeff Bezos settled the terms of their divorce.  McKenzie now has some wealth protection issues to consider.  Chris discusses what financial planning strategies might apply to McKenzie as she moves foward with her life:

Avoiding common mistakes before or during your retirement is important. Chris and other financial advisors discuss what to be mindful of for retirement planning here


Financial Advisers Take Issue with Democratic Plans to Tax the Rich

In "Financial Advisers Take Issue with Democratic Plans to Tax the Rich", Jeff Benjamin gets the perspective of financial planners about the latest income tax proposals from the Democratic candidates. Financial Planners tend to be more anti-tax than average. I take the opposite side. It's not that I like taxes any more than anyone else. However, I believe in a democracy, we need to each pay our share. Maybe it starts with cutting loopholes for the well off as well as for corporations. Read more here


Rolling Out Robo-Advisors Has Been Challenging For Early Adopters

Are you considering using a Robo-Advisor for your investment recommendations? Ryan Neal talks to Financial Planners about their experiences and concerns with the technology. The reality is that robo implementation has been difficult. See what Chris has to say here

Have you evaluated your financial health lately? Chris has some ideas about what to consider as you get back on track for success

Are you concerned about the market's wild ride? If you are like most people you will be.  Check this article by Ali Malito for MarketWatch for advice on how to cope with market volatility. Chris suggests differentiating funds that are needed for the short term from the funds that are needed for the long term.

Emily Blandon


In "10 Ways to Improve Your Retirement Finances in 2019" Emily Blandon at US News compiles strategy recommendations to boost returns in 2019. Chris' contribution was to propose a Goldilocks approach to diversification. Check that and the other strategies here.


For many retirees, even those who have meticulously planned their retirement income, the amount of taxes they are expected to pay may come as an unwelcome surprise. How can you best plan for a tax efficient retirement? Chris Chen and other financial planners offer common sense suggestions in this CNN Money article.


Most people would be better off not having mortgages in retirement. Relatively few will get any tax benefit from this debt, and the payments can get more difficult to manage on fixed incomes. But retiring a mortgage before you retire isn’t always possible. Financial planners recommend creating a Plan B to ensure you don’t wind up house rich and cash poor – see what Chris Chen has to say.

The change in tax laws affects how alimony and child support are treated, going into effect for agreements signed after the end of the year. So, if divorce is in your near future, it might pay to try to beat the clock, says Chris Chen in this Kiplinger article.

Yes, you can. However your specific needs should drive the number and type of policies you purchase. Read Chris’ input to this story for more information on properly planning for insurance needs.

The latest data from a poll of 1,000 Americans age 22 to 37, finds that nearly half of millennials are spending more money on restaurants and dining out than they are putting into retirement accounts. Thirty-two percent spend more on clothes than they save, and more than a quarter reported spending more on coffee, alcohol and online streaming services. See what Chris Chen has to say from a financial planning perspective.

Seventy percent of U.S. households headed by people ages 65 to 74 had at least some debt in 2016, according to the Federal Reserve’s latest Survey of Consumer Finances. Because paying debt usually gets more difficult on a fixed income, people have the most options to deal with debt if they create a plan before they retire, financial planners say. Refinancing a mortgage, for example, is usually less of a hassle while people are still employed. It’s also typically easier to generate the extra income that may be needed to pay off debt. Read Chris Chen’s thoughts on generating cash flow is retirement.



Insight Financial Strategists’ own Chris Chen has been named to Investopedia’s Most Influential Advisors list for 2018!
The list celebrates financial advisors who have contributed significantly to conversations about financial literacy, investing strategies, life-stage planning and wealth management.


U.S. News and World Report

With a bond tent, an investor gradually allocates a larger portion of his or her portfolio to bonds as he or she nears retirement in order to protect against market downturns. A bond tent can be an appropriate tool for investors who will not have large Social Security payments or pensions, and who will need to rely primarily on income from their portfolio to fund retirement. “The reality is that we cannot predict when a downturn will actually happen and what its magnitude will be. Hence strategies like bond tents are critical to the financial well-being of retirees and near retirees.” says Chris Chen, a financial planner for Insight Financial Strategists in Waltham, Massachusetts.

ESG is a relatively new term in investing. It stands for Environmental, Social and Governance, referring to the three components of what is more widely known as socially responsible investing. In this USA Today article, Bob Powell, with the help of Eric Weigel, Chief Investment Officer at Insight Financial Strategists, explores the intricacies of this style of investment.

Advisors focused on capturing next-generation assets should realize there’s a surviving spouse between them and their millennial pot of gold — and, statistically speaking, it’s a woman. Chris Chen of Insight Financial Strategists in Waltham, Mass., agrees recent divorce and widowhood are “emotionally overwhelming” experiences — but he thinks the hands-off element is sometimes temporary. “What they want is to avoid anything that reminds them of the trauma that they just experienced,” says the CDFA. “They want to avoid also what they perceive as the real hard work of getting on top of the financial issues.”

Under President Trump’s new tax plan, starting in 2019, payers will be no longer be able to deduct their alimony payments. For divorcees in the top tax bracket, the change could mean they effectively pay double in post-tax costs compared to what they had previously agreed to in their prenups.  If agreements aren’t amended to factor in the tax changes, it will be up to divorce attorneys to settle — or judges to decide — whether the amounts or formulas still stand for couples who divorce starting next year. “Folks already don’t like paying alimony, so doubling the effective cost would be painful,” said Chris Chen, a financial planner who specializes in divorce-related matters at Insight Financial Strategists.


Medical Economics

Physicians are riding the digital health wave, investing in startup companies long before they reach the public stock markets as technology and regulation disrupt the healthcare industry. Some physicians see the deals as financial investments, others see them as potential future careers, but all of them should keep the significant risks of early-stage companies in mind before jumping in, experts say. Consider the personal credibility of anyone involved in the deal, says Chris Chen, CFP, chief executive of Insight Financial Strategists in Waltham, Mass. “Financials always look good because they are contrived to look good,” he says. In other words, treat any future projections with skepticism. “Beyond that, look at whether the principals are properly motivated and have credibility from doing this work before.”

If your retirement investments are spread out over multiple individual retirement accounts (IRAs), it may make sense to treat these various accounts as one, a process known as “aggregating.” Aggregation means treating several accounts as one, not actually combining them, and can allow for more efficient planning for distributions and more efficient investment strategy management.

Day trading is treacherous, especially in a volatile market. “If you want to compete on that level, you need the weapons,” Chen said. “It’s like going to a gunfight with a knife.” Day trading in a consistent bull market, like the past year and a half has been, can be easier, since you buy, see the prices go up and sell to make a profit. But during volatility, it’s almost impossible to tell what will happen and how long the ups and downs will sustain, he said.

Just two weeks ago the consensus was that we were going to experience a continuation of the bull market at least into the early part of this year. This is still our view. Read Chris’ thoughts on the recent market turmoil, as well as the views of other financial advisors.

Buying life insurance on someone else and naming yourself as beneficiary might sound like a plot point in a film noir mystery. But taking out a policy on another person makes good sense in some situations. Whether you can do it, though, depends on your relationship and having the other person’s consent.

Credit cards can be a useful convenience when used for day-to-day expenses and paid off at the end of the month, says Chris Chen, a certified financial planner and wealth strategist at Insight Financial Strategists in Boston. “In some cases, it’s very difficult to function without a credit card — for hotels and rentals cars, for instance,” he says. He adds that they are also useful for online shopping, since credit cards offer far more protections than debit cards.

Many non-native workers in the U.S. are young professionals hired by firms seeking workers with highly valued skills. In 2016, more than 870,000 foreign nationals were granted the most common temporary work visas. Should these workers consider contributing to company sponsored plans? This article provides important considerations in answering that question.

Acrimonious couples who were racing to get divorced by Dec. 31 or face dire tax consequences can breathe a sigh of relief. The final tax overhaul bill gives them until the end of 2018 before completely upending the divorce process.

If you’ve decided that a store card isn’t right for you, stay strong and don’t let the sales associate persuade you. “Their job is to get you to sign up,” says Chris Chen, a Massachusetts-based CFP.

Written into the fabric of the new GOP tax proposal is a change in how alimony is taxed. People paying alimony could lose “the greatest tax deduction ever.” And that could ultimately affect those receiving alimony, too.

While many couples dissolve their marriages without significant legal involvement, divvying up retirement accounts, particularly pensions, is thorny. Doing it without a proper legal agreement could stick you with a hefty tax bill and penalties. In some cases, one party may end up with nothing.

For women, divorcing an income-providing, money-managing spouse is bound to do damage to the bottom line – and force some changes. However, with proper planning and education, uncoupling can offer independence and financial power as well.

In this article, Chris Chen and Eric Weigel explain the new trend toward socially responsible investing (SRI) and the accompanying environmental, social and governance (ESG) metrics used by investment managers, as well as the evolution of these strategies over time, and important considerations for interested investors.

Getting the flu shot should be a no-brainer,” says certified financial planner Chris Chen, wealth strategist with Insight Financial Strategists in Waltham, Massachusetts. “The low or free cost of the shot is one of the great deals of everyday living, given what it can cost if you get the flu.”


Wicked Local Lexington

Economic and Finance Lecture Series — Money Management & Investment: Retirement: 2 p.m. Nov. 1. Wealth strategist Jim Wood from Insight Financial Strategists LLC will present money management considerations for one’s pre-retirement “accumulation period” and their post retirement “distribution period” at the Lexington Community Center. Call 781-698-4870 to sign up.



Investment News

Nearly thirty years ago, on Oct. 19, 1987, investors and advisers learned a lesson about stock market volatility that has stayed with them to this day. “I had recently graduated from graduate school with an MBA,” said Chris Chen, a financial planner with Insight Financial Strategists. “Everyone I knew who went to Wall Street that year got laid off.”

Going from a dual-income household in marriage to a single-income household is a big change.  “Alimony and child support are not forever,” Chen says. “You have to plan for when it ends: Continue advancing your career to progress from a lower-paying job, and make sure your expenses are lined up at the right level.”

Read Chris Chen’s take on a new Harvard Business School study that found that employees tend to contribute the same amount to either a Roth or traditional 401(k), indicating some employee confusion around the tax advantages and impacts.


The DO: Money Matters

“New doctors have a lot of pent-up consumption, so it’s natural that they would want to splurge a little,” says Chris Chen, a certified financial planner with Insight Financial Strategists in Waltham, Massachusetts. But giving into temptation and plunking down a wad of cash on a BMW or a Lexus can be a terrible financial mistake, Chen says. Find out why.

Don’t neglect to review your insurance coverage amid the grief and complicated logistics of breaking up. The right insurance creates a financial safety net for the fresh start ahead, and this article outlines the checklist you should be using.

In this article, we’ll go over eight major reasons why you should focus on keeping your 401(k) plan until retirement, rather than using it as a piggy bank.


Financial Advisor Magazine

A rising number of financial advisors nationwide believe that virtual reality (VR) technology geared to financial planning will help clients overcome their limited ability to envision their golden years. Learn more about these tools under development.

As the Department of Labor’s rules that govern the practice of advising clients on investments take effect,  advisors provide insight into their individual philosophy and personal ethical considerations that will guide their roles as fiduciaries.

If you’re planning to remain in a relationship without getting married, consider these guidelines before putting down cash on an investment like a home or car. You owe it to yourself and your partner to be prepared — just in case.

Check out these tips on how to pre-load your spending, a classic method to ensure that you don’t overspend. Advance planning and a thoughtful approach to spending can help you meet your financial goals.


Insurance News Net

Many baby boomers are still wounded financially by the the Great Recession of 2008. Advisors can help them recover, although many are hesitant to seek advice.

Advisors are fielding questions and concerns from clients worried about the current bull market’s advanced age, and reminding them to take a long term view with respect to their savings and investments.


The DOL fiduciary rule was passed last year to mandate that advisors’ advice should only be in the client’s best interest. Dodd-Frank was passed and implemented in the wake of the Great Recession to help prevent another crash. The Trump administration has suggested that they wanted to get rid of the DOL rule and Dodd Frank.

It is accepted wisdom that portfolios need to be re-balanced. Yet this is task that is more complicated than at first blush.


Investor’s Business Daily

Long Term Care is a critical and complex aspect of a retirement plan. Yet it is often not addressed very well. For most people it is well worth the effort. Check also this blog post by Jim Wood.

Giving money to kids can be more complicated than giving a toy. Jean Chatzky goes over some of the key considerations

Student loans are a major investment these days, leading to a substantial average default rate ranging from 18.9% in New Mexico to 6.1% in Massachusetts, according to Nerdwallet.


Magnify Money

The Federal Reserve came through with its long awaited interest rate increase this December 2016. A quarter point increase is small, but it still has impact on people’s finances.


Investment News

Obviously, men also make mistakes when they divorce. Did we mention the obvious path to try to avoid these mistakes?

There appears to be a gender divide about divorce attitudes that leads to mistakes that women tend to make more than men. In my opinion, the divide is not so much about gender as it is about the relative power of the parties.

For many, the last few years before retirement is a planning scramble. Despair not! There are still things you can do if you are late starting.

It is critically important not to overreact to the new administration. In the end, the US economy will outlast Trump .

A lot of things will change with the new Trump administration. However, if you have a strong long term plan, things will probably work out. If not, get a long term plan! For the short run, you may want to mitigate risks.

Notwithstanding the post election market rally we are likely to face a few bumpy roads ahead. It is important not to panic and not to lose sight of long term goals.

In this Investopedia piece, I review some of the issues with divorce and retirement accounts.


CNS News

How to Ditch Your Bank

Who has never been annoyed at their bank? In the wake of the Wells Fargo scandal, this article by Jeanne Lee of Nerdwallet explores the steps to take when you want to ditch your bank!


PR Buzz

A plug for a new book on negotiating from Janet Miller Wiseman. This new book outlines a practical way to negotiate disagreements. Janet Miller Wiseman is a Certified Family and Divorce Mediator and a co-founder of the Massachusetts Council on Family Mediation. She is also the author of Mediation Therapy: Short-Term Decision Making for Couples and Families in Crisis.

Mark Shoeff at Investment News asked if Trump’s tax avoidance is legal and/or moral, and if it is evidence of the famous Trump business acumen.

Suzanne Wooley at Bloomberg wonders if spouses hide retirement savings from one another . She cites a Fidelity study that states that 43% of people do not know how much their partner makes, much less how much is in their partner’s retirement account. Most people also have no idea what they would need to keep up their lifestyle in retirement.

Why might that be? According to Suzanne’s article, they are a range of factors ranging from people hiding their finances to people not having a culture of talking about money (this is my contribution to Suzanne’s article).

Regardless it seems that most of us could use a course in financial communications .

Suzanne Wooley writes in this Bloomberg article that the Betterment robo advisor can now optimize for taxes as well as asset allocation. It sounds like a compelling solution.

After testing the Betterment, it occurred to me that a client had better understand asset allocation, and now taxes as well, if they want to make good decisions. Sure a robot can implement anything you tell them, but you still need to give them the right input!

A robo cannot integrate tax loss harvesting in one account in your wider financial strategy, including your overall tax planning, legacy planning, risk management and coordinate various accounts.

With the current state of development, robo advisors are best used as a tool for Certified Financial Planner professionals, maybe not so much for end users directly.

In the wake of the Brangelina divorce, Dan Goldstein of MarketWatch delves into the issues of disposing of your home when you are divorcing.

There is nothing easy about divorce or widowhood. Ilana Polyak’s article in CNBC summarizes the issues

There are still too many people who feel compelled to raid their 401(k) in times of stress. This article by Debbie Nason for CNBC captures the issues.

Kate Ashford at Forbes reviews some of the critical decisions about college financing.

It is unfortunate that so many people feel that college was not worth it. Kate Ashford at Forbes explores the issues

Diversification is an oft misunderstood concept. This article by Chris Chen reviews some of the issues.

People often want to know how fast they should pay off their mortgage. It sounds obvious (as soon as possible), but it may not be.

What should Prince have done about his estate planning. Unfortunately, Prince left quite a challenge behind.


Investment News

Chris Chen is happy to figure prominently on this list!


Wealth Management


Boston Globe


Health Insurance Taxation Issues Post-Divorce
by Chris Chen, CFP®, CDFATM and Justin L. Kelsey, Esq.

Unintended Consequences of “An Act to Reform and Improve Alimony,” in Massachusetts: Avoiding the Pitfalls on the Road to Reform
by Janet Miller Wiseman, Certified Divorce Mediator, Jeanne Kangas, Esquire, and Howard Goldstein, Esquire, Chris Chen, Certified Divorce Financial Analyst.
Originally published by the Boston Bar Association.


May 12

Marriage and Building Wealth: Finding a Happy Balance

By Chris Chen CFP | Financial Planning , Retirement Planning

Marriage and Building Wealth: Finding a Happy Balance

Marriage affects your finances in many ways, including your ability to build wealth, plan for retirement, plan your estate, and capitalize on tax and insurance-related benefits. Here are some considerations to keep in mind if you are thinking of getting married or have just tied the knot.

Building wealth

If both you and your spouse are employed, two salaries can be a considerable benefit in building long-term wealth. For example, if both of you have access to employer-sponsored retirement plans, your joint contributions are double the individual maximums ($17,500 for 2013). Similarly, a working couple may be able to pay a mortgage more easily than a single person can, which may make it possible for a couple to apply a portion of their combined paychecks for family savings or investments.

Retirement benefits

Some (but not all) pensions provide benefits to widows or widowers following a pensioner’s death. When participating in an employer-sponsored retirement plan, married workers are required to name their spouse as beneficiary unless the spouse waives this right in writing. Qualifying widows or widowers may collect Social Security benefits up to a maximum of 50% of the benefit earned by a deceased spouse.

Estate planning

Married couples may transfer real estate and personal property to a surviving spouse with no federal gift or estate tax consequences until the survivor dies. But surviving spouses do not automatically inherit all assets. Couples who desire to structure their estates in such a way that each spouse is the sole beneficiary of the other need to create wills or other estate planning documents to ensure that their wishes are realized. In the absence of a will, state laws governing disposition of an estate take effect. Also, certain types of trusts, such as QTIP trusts and marital deduction trusts, are restricted to married couples.

Tax planning

When filing federal income taxes, filing jointly typically results in lower tax payments when compared with filing separately.

Debt management

In certain circumstances, creditors may be able to attach marital or community property to satisfy the debts of one spouse. Couples wishing to guard against this practice may do so with a prenuptial agreement.

The opportunity to go through life with a loving partner may be the greatest benefit of a successful marriage. That said, there are financial and legal benefits that you may want to explore with your beloved.


Mar 15

Are your affairs in order?

By Chris Chen CFP | Financial Planning

While it is not  pleasant to think of one’s own passing, having your affairs in order can help ease the burden on friends and family, when the time comes, and can contribute to your own peace of mind knowing that you have done all you can to prepare. There are many factors that should be considered when trying to create an effective and comprehensive estate plan. Some considerations include:

  • Instructions on your own care in sickness
  • Guardians for your minor children should both parents pass
  • Protection from creditors
  • Charitable contributions
  • Continuation of a family business
  • Reducing or eliminating tax
  • Maintaining family harmony
  • Legacy creation and support of future generations

In addition, all these factors should integrate appropriately with your retirement income planning and your investment decisions.

Even if you already have an estate plan in place, you may want to conduct a review. Decisions made years ago may not accurately reflect your current wishes. Estate plans are not for the significantly wealthy alone. If you have children in your care or a business you wish to leave to future generations, it is important that protections and guidance are put in place now and are not put off until your retirement years. It is always a possibility that you may not have the luxury to wait so long.

A poorly executed estate plan, or the lack of one at all, could leave those you most care about suffering needlessly in your absence.  Get ready today to gain control of your estate plan!

Nov 18

Seven Year End Wealth Management Strategies

By Chris Chen CFP | Financial Planning , Investment Planning , Retirement Planning , Tax Planning

Photo by rawpixel on Unsplash

As we approach the end of a lackluster year in the financial markets, there is still time to improve your financial position with a few well placed year-end moves .

Maybe because we are working against a deadline, many year-end planning opportunities seem to be tax related .  Tax moves, however, should be made with your overall long-term financial and investment planning context in mind. Make sure to check in with your financial and tax advisors.

Here are seven important moves to focus your efforts on that will help you make the best of the rest of your financial year .

1) Harvest your Tax Losses in Your Taxable Accounts

As of[ October 26, the Dow Jones is up 1.65%, and the S&P500 is up just 0.98% ]for the year. Unfortunately, many stocks and mutual funds are down for the year. Therefore you are likely to have a number of items in your portfolio that show up in red when you check the “unrealized gains and losses” column on your brokerage statement.

You can still make an omelet out of these cracked eggs by harvesting your losses for tax purposes . The IRS individual deduction for capital losses is limited to a maximum of $3,000 for 2018.  So, if you only dispose of your losers, you could end up with a tax loss carryforward, i.e., tax losses you would have to use in future years. This is not an ideal scenario!

However, you can also offset your losses against gains. For example, if you were to sell some losers and hypothetically accumulate $10,000 in losses, you could then also sell some winners. If the gains in your winners add to $10,000, you have offset your gains with losses, and you will not owe capital gain taxes on that joint trade!

This could be a great tool to help you rebalance your portfolio with a low tax impact. Beware though that you have to wait 30 days before buying back the positions that you have sold to stay clear of the wash sale rule.

2) Reassess your Investment Planning

Tax loss harvesting is a great tactic to use for short-term advantage. As an important side benefit, it allows you to focus on more fundamental issues. Why did you buy these securities that you just sold? Presumably, they played an important role in your investing strategy. And now that you have accumulated cash, it’s important to re-invest mindfully.

You may be tempted to stay on the sideline for a while and see how the market shakes out.  Although we may have been spoiled into complacency after the Great Recession, the last month has reminded us that volatility happens.

No one knows when the next bear market will happen , if it has not started already. It is high time to ask yourself whether you and your portfolio are ready for a significant potential downturn.

Take the opportunity to review your goals, ensure that your portfolio risk matches your goals and that your asset allocation matches your risk target..

3) Check on your Retirement Planning

It is not too late to top out your retirement account!  In 2018, you may contribute a maximum of $18,500 from your salary, including employer match to a 401(k), TSP, 403(b), or 457 retirement plan, subject to the terms of your plan. Those who are age 50 or over may contribute an additional $6,000 for the year.

If you have contributed less than the limit to your plan, there may still be time! You have until December 31 to maximize contributions for 2018, reduce your 2018 taxable income (if you contribute to a Traditional plan), and give a boost to your retirement planning.

Alternatively to deferring a portion of your salary to your employer’s Traditional plan on a pre-tax basis, you may be able to contribute to a Roth account if that is a plan option for your employer. As with a Roth IRA, contributions to the Roth 401(k) are made after tax, while distributions in retirement are tax-free.

Many employers have added the Roth feature to their employee retirement plans. If yours has not, have a chat with your HR department!

Although the media has popularized the Roth account as tax-free, bear in mind that it is not. Roth accounts are merely taxed differently . Check in with your Certified Financial Planner practitioner to determine whether electing to defer a portion of your salary to on a pre-tax basis or to a Roth account on a post-tax basis would suit your situation better.

4) Roth Conversions

The current tax environment is especially favorable to Roth conversions . Under the current law, income tax rates are scheduled to go back up in 2026; hence Roth conversions could be suitable for more people until then.

With a Roth conversion, you withdraw money from a Traditional retirement account where assets grow tax-deferred, pay income taxes on the withdrawal, and roll the assets into a Roth account. Once in a Roth account, the assets can grow and be withdrawn tax-free, provided certain requirements are met. If you believe that your tax bracket will be higher in the future than it is now, you could be a good candidate for a Roth conversion .

Read more about the new tax law and Roth conversions

5) Pick your Health Plan Carefully

It is health insurance re-enrollment season! The annual ritual of picking a health insurance plan is on to us. This could be one of your more significant financial decisions for the short term. Not only is health insurance expensive, it is only getting more so.

First, you need to decide whether to subscribe to a traditional plan that has a “low” deductible or to a high deductible option.  The tradeoff is that the high deductible option has a less expensive premium. However, should you have a lot of health issues you might end up spending more.  High deductible plans are paired with Health Savings Accounts (HSA).

The HSA is a unique instrument. It allows you to save money pre-tax and to pay for qualified healthcare expenses tax-free. Unlike Flexible Spending Accounts (FSAs), balances in HSAs may be carried over to future years and invested to allow for potential earnings growth. This last feature is really exciting to wealth managers: in the right situation clients could end up saving a lot of money.

If you pick a high deductible plan, make sure to fund your HSA to the maximum. Employers will often contribute also to encourage you to choose that option.  If you select a low deductible plan, make sure to put the appropriate amount in your Flexible Spending Account. FSAs are used to pay for medical expenses on a pretax basis. Unlike with an HSA, you cannot rollover unspent amounts to future years.


Gozha net on Unsplash

6) If you are past 70, plan your RMDs

If you are past 70, make sure that you take your Required Minimum Distributions (RMDs) each year. The 50% penalty for not taking the RMD is steep. You must withdraw your first minimum distribution by April 1 of the year following the year in which you turn 70 ½, and then by December 31 for each year after.

Perhaps you don’t need the RMD? You may want to redirect the money to another cause. For instance, you may want to fund a grandchild’s 529 educational account. 529 accounts are tax-advantaged accounts for education. Although contributions are post-tax, growth and distributions are tax-free if they are used for educational purposes.

Or, you may want to plan for a Qualified Charitable Distribution from the IRA and take a tax deduction. The distribution must be directly from the IRA to the charity. It is excluded from taxable income and can count towards your RMD under certain conditions.

7) Plan your charitable donations

Speaking of charitable donations, they can also be used to reduce taxable income and provide financial planning benefits. However, as a result of the Tax Cut and Jobs Act of 2017 (TCJA), it may be more complicated than in previous years. One significant difference of the TCJA is that standard deductions went up to $12,000 for individuals and $24,000 for married filing jointly. Practically what that means is that you need to accumulate $12,000 or $24,000 of deductible items before you can feel the tax savings benefit.

In other words, if a married couple filing jointly has $8,000 in real estate taxes and $5,000 of state income taxes for a total of $13,000 of deductions, they are better off taking the standard $24,000 deduction. They would have to donate $7,000 before they could start to feel the tax benefit of their donation.  One way to deal with that is to bundle your gifts in a given year instead of spreading them over many years.

For instance, if you plan to give in 2018 and also in 2019, consider bundling your donations and giving just in 2019. In this way, you are more likely to be able to exceed the standard deduction limit.

If your thinking wheels are running after reading this article, you may want to check in with your wealth manager or financial planner: there may be other things that you could or should do before the end of the year!


Check these other wealth management posts:

Is the TCJA an opportunity for Roth conversions?

New Year Resolution

How to Implement a New Year Resolution

Tax Season Dilemna: Invest ina Traditional IRA or a Roth IRA 




Note: The information herein is general and educational in nature and should not be construed as legal, tax, or investment advice. We make no representation as to the accuracy or completeness of the information presented.  To determine investments that may be appropriate for you, consult with your financial planner before investing. Tax laws and regulations are complex and subject to change, which can materially impact investment results. Views expressed are as of the date indicated, based on the information available at that time, and may change based on market and other conditions.We make no representation as to the completeness or accuracy of information provided at the websites linked in this newsletter. When you access one of these websites, you assume total responsibility and risk for your use of the websites to which you are linking. We are not liable for any direct or indirect technical or system issues or any consequences arising out of your access to or your use of third-party technologies, websites, information, and programs made available through this website.