- Meet with Penn Investment Advisors, Inc., a qualified and experienced financial planning firm. Discuss your financial goals and develop a plan with their qualified professionals.
- Discuss any planned actions with your tax professional. Many actions and reactions can have tax consequences which you must understand before implementation.
- Don’t abandon rationale investment strategies because the market has become irrational. If you have a strategy which is aligned with your goals, you may not want to give-up on that strategy.
- Step away from the over reactive media. Be an informed investor, avoid being consumed by the headlines. A well-diversified portfolio may not drop as much as the media portrays the “market” to be down.
- Avoid acting on impulse or overreacting. Avoid a panic sell, as it may take too long for you to become comfortable enough to re-invest.
- Review your long-term goals. Create a list of 3-5 important financial goals. Together we can formulate a plan to help move you toward these goals.
- Consider a ROTH conversion. Together with your Tax Professional we can discuss whether a ROTH conversion strategy is right for your situation.
- IRA and ROTH contributions. Until July 15th you can contribute to a Traditional or ROTH IRA for 2019. We can help you determine if you are eligible.
- Increase your retirement account contributions. Consider increasing any monthly deposits going into your IRA, ROTH or employer sponsored retirement plan, if you are not already meeting your contribution limits.
- In-kind Required Minimum. If you don’t need the cash the IRS forces you to take from your IRA each year consider a withdrawal of a stock, mutual fund or ETF instead. The holding can be transferred to a non-qualified account at lower prices and continue to be held outside of your IRA.
- Tax Loss Harvesting. Consider selling an investment in your non-qualified account that you have an unrealized loss in. This loss can be used to offset any capital gains you may incur this year or be carried over to future years.
- Cost Replacement Strategy. An opportunity may exist to buy shares of a security you currently hold, at a lower price. After the Wash Sale Period passes you can sell the higher priced holdings.
- Reduce portfolio withdrawals. Temporarily reduce your portfolio withdrawals and lifestyle expenses during a market correction or periods of prolonged volatility.
- Evaluate your portfolio strategies. Make sure your portfolio strategies align with your long-term financial Making changes while portfolio values are lower may reduce the impact of a potential tax obligation.
- Know the level of risk you are willing to accept. We have a process to access your tolerance for risk. Your portfolio, in theory, should match your risk tolerance. This may help give you peace of mind – knowing your have a plan in place during volatile periods in the Market.
- Know the level of risk in your portfolio. We can analyze your portfolio to determine the underlying risk level, to help you know if it meets your risk tolerance.
- Consider having a small portion of each portfolio dedicated to cash. We typically run with a minimum of 2% cash.
- Emergency Reserves. Evaluate the appropriate amount of emergency cash to have on hand and not invested in the “market”.
- Rebalance your Portfolio. Rebalancing is the process of buying or selling small portions of your portfolio to restore the portfolio to your original state. This process can help keep the portfolio aligned with your risk tolerance.
- Dollar Cost Averaging. Start a periodic investment program by making weekly, bi-weekly or monthly deposits into your investment account.
- Invest for your children and grandchildren. Consider funding a ROTH IRA if they have a part-time job, open and contribute to a 529 Plan or custodial account, depending on their situation.
To discuss this article with Penn Investment Advisors, Inc., please call us at 1.800.626.1027 or email us at invest@pennadvisors.com
Source: IRS.gov
Converting from a traditional IRA to a Roth IRA is a taxable event.
For a comprehensive review of your personal situation, always consult with a tax or legal advisor. Investments and advisory services are offered through Penn Investment Advisors, Inc. (PIA), a Registered Investment Advisor. Penn Investment Advisors, Inc., is a wholly-owned subsidiary of Penn Community Bank (Bank). Penn Investment Advisors, Inc. does not provide tax or legal advice; consult your tax or legal advisor regarding your particular situation. Investment products are not a deposit, are not FDIC insured or any other governmental agency, are not guaranteed by the Bank, and involve investment risk, including the possible loss of principal.
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.
Investment advisory services are offered through Penn Investment Advisors, Inc. , a Registered Investment Advisor. Penn Investment Advisors is a wholly owned subsidiary of Penn Community Bank (Bank). Penn Investment Advisors does not offer or provide legal or tax advice. Please consult your attorney and/or tax advisor for such services. The products offered by Penn Investment Advisors are not insured by the FDIC, the NCUA or any other agency of the government, are not deposits or other obligations of the Bank or guaranteed by the Bank and involve investment risks, including possible loss of principal amount invested.
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NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY | MAY LOSE VALUE