How will today's high inflation impact my retirement?

Inflation is definitely a concern, and the media frenzy around current inflation likely isn’t helping ease your current fears. While you are right to be concerned about inflation, it doesn’t necessarily mean it will threaten your retirement plan, even if today’s inflation lasts longer than we first expected.

| Inflation is surprisingly more dangerous than a market crash. |

| Inflation Vs. Social Security and other ‘Guaranteed’ Income |

| Using Multiple Inflation Rates |

| What Should You Do? |

What should I do with my annuity in its second year if the cap and spread values have been lowered?

I am sad you have to deal with this and it’s unfortunately not uncommon for annuity sales representatives to misrepresent the annuity. As for what to do next, you should determine if it would be better to continue the annuity or give up the money you have already put into it and instead invest using a different strategy. Even though the annuity is a bad investment…

How much of my house-sale proceeds should I use for purchasing a new home?

How much to use will depend on the rest of your financial situation, including your monthly income, the size of your emergency fund, whether you are on track for retirement savings, and even the terms of the divorce. While it is important you get a place of your own, take your time with this decision. You don’t want your excitement over buying a new home to overshadow your rational analysis and decision-making.

Also Covered:

Impacts on monthly cash flow are key
Don’t overspend, especially in this market
Don’t unravel the fairness of the divorce settlement with the home purchase

Will Russia's Invasion of Ukraine Impact My Investments?

Following ongoing pandemic impacts and a high inflation report markets again were impacted by the shocking invasion and bombing of Ukraine by Russia. Historically, geopolitical events have had short-term impacts on the world economy and investment markets, so the humanitarian impact is likely to be much larger than the economic one. Also covers:

Historical market reactions to wars and geopolitical events
How you can help Ukraine

Should I invest money from a home equity line of credit?

Since you have already saved up the money, it would be best to use the cash to pay for the addition and avoid the home equity line of credit (HELOC). Taking out the HELOC would cost you interest, even if it is a small amount, and there is no reason to pay your bank the interest if you don't have to. The following two scenarios may help.

Scenario 1: Get the HELOC and Invest
Scenario 2: Pay Cash
Scenario 3: Get the HELOC and a mistake

InvestingJoshua Escalante Troesh, CFPNovember 1, 2021Real Estate Investing

Is now a good time to sell some of my investment properties?

This is a more complex question than it may seem at first. From a simple perspective, you want to analyze what the true expected future rate of return is on the property including all costs such as maintenance, future upgrades, vacancy, taxes and more. Then compare that true rate of return with the other options you have for the money, accounting for differences in risk.

Also Covered:

High Valuations = Lower Expected Future Returns
Impact of taxes and transaction costs
Your desired life trumps the money

How should I invest the $200,000 I received from the sale of my house?

How you invest, or even if you should invest, needs to be determined by when you need the money. Based on the details you provided you shouldn’t look at investing it at all for the half you need in the next 2 years. For clients in this situation, I recommend keeping the money needed in two years in a federally-insured savings account. Both the risk and the cost of investing would end up being against your best interest.

InvestingJoshua Escalante Troesh, CFPAugust 1, 2021Retirement Planning

What Do I Do with the Recent Stock Market Crash?

The last couple weeks saw a stock market drop which has many spooked. Here are the 6 things you should do to keep the market downturn from ruining your financial plan.

How can I leverage the equity on an investment property I own without a HELOC or refinancing?

There are two broad ways to leverage equity in real estate or any investment; selling the investment or borrowing against the investment. Beneath these two broad categories are dozens of specific strategies, with varying advantages and disadvantages . Scheduling a call to discuss your situation and desires would be the best way of determining a specific (possibly creative) strategy to accomplish your goal.

Full Article Also Covers:

Sell Part of the Property
Replace the HELOC with a HELOC
Be Wary of Advice to Roll the First into a HELOC

InvestingJoshua Escalante Troesh, CFPFebruary 19, 2020Real Estate Investing, HELOC, 30-year mortgage

What should my fiancé and I do with the extra $7,000 we make each month?

Before worrying about strategies for saving and investing start by having a discussion about the goals you and your fiancé have for your life together; such as buying a home, having children, or even taking vacations. Then focus on how you can align your finances toward those goals. This discussion on your goals is the most important financial discussion you can have as it is the only one which directly connects to the life you want to build.

Also Covered:

INVEST MORE AGGRESSIVELY
OPEN A HEALTH SAVINGS ACCOUNT (HSA)
SAVE UP FOR A DUPLEX/TRIPLEX
SAVE UP TO START A BUSINESS
BUY A HOUSE

Is Peer-to-Peer Lending a Good Idea?

Peer-to-peer lending (P2P lending) is a relatively new investment class and tends to carry with it high risk. As a result, I would not recommend P2P lending as a significant part of a person’s portfolio - definitely not more than 5% to 10% of their invested assets. This means you should build up a significant portfolio of more traditional investments before considering investing here.

Full Article Also Covers:

Adding P2P Lending Isn’t Necessary to Diversify From Mutual Funds
P2P Lending Actually Increases Risk to a Portfolio
P2P Lending Scandals

Where should a first time investor start?

You can invest in any type of investment account, including retirement accounts, through a brokerage company, a mutual fund company, or through Purposeful SP. At your age, and with over 30 years until you retire, you should consider investing heavily in a broadly diversified stock portfolio which includes both U.S. and international stocks. With three plus decades to go, you only need bonds in your portfolio to help you sleep at night and for rebalancing opportunities. In other words, after doing your research, choose a bond percentage which makes YOU feel comfortable that you have enough "safety" in your portfolio.

Article Also Covers:

Beware Portfolio Advice From Books, Magazine, or the Internet
Build an Emergency Fund Before Investing
Three easy ways to get started with an investing account

Is my AAA financial advisor's advice to invest in an annuity a good idea?

How should I invest my extra income?

Should I take out a loan on my rental property or sell it to pay off my debt?

You should start by determining if owning this rental property is in your long-term life plan (without considering the credit card debt). Below are my comments on some of the issues to consider including the true rate of return of the property, transaction costs associated with the sale, and how the rental property may impact your lifestyle and career goals.

What is the best way to save for the future outside of a work retirement plan?

It sounds like you have a good handle on your retirement savings based on your contributions to both the TSP and your workplace plan, assuming you are contributing at least 10% to 15% of your income. If so, begin investing outside your retirement accounts in a taxable investment account to fund other goals such as buying a home, starting a business, or taking a major vacation.

Do I have to buy treasury notes through a bank or brokerage firm?

There are three ways to purchase Treasury notes directly; through a brokerage, through a bank, or directly from the U.S. Treasury. While they are considered free from default risk, Treasury Notes carry significant other risks including interest rate risk and inflation risk. This is especially true with today’s . . . .

As a college student, should I continue investing or save to pay off my debt first?

The good news is you are choosing between two good options, so you really can't go wrong with either decision. If your student loans are subsidized loans, then the U.S. Government is paying the interest for you, so there is no reason to pay anything on the loans until you graduate. If they are not subsidized loans, then you may want to consider paying just the interest on the loans and then contributing to (or even maxing out) your IRA. This will give you the best of both worlds: being able to invest in your IRA and . . . .

As a college graduate with a new job, how should I structure what I do with my income?

As with many things in the financial world, the best answer is "a little of everything." You should get in the habit of investing in your retirement from day 1, even if it is a small amount. Those who put off contributing to their retirement for 'a little while' often find themselves 10 or even 20 years into their career with no retirement savings. To catch up they need to contribute huge portions of their income to retirement accounts. Here is my recommendation for what to focus on:

How are taxes calculated when Bitcoin is exchanged for physical gold and a profit is generated?

The IRS considers Bitcoin, and all virtual currency, to be property and will tax the gains in the property whenever you sell or exchange your Bitcoin for another asset (including gold or even other virtual currency). So you will have to pay taxes on the amount the Bitcoin has increased in value since you bought it. Below are additional key tax issues related to virtual currency . . . .

Also Covered:

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