Long before social media and podcasts, humans had fables and proverbs. Aesop’s Fables were a childhood read. But they began as spoken stories in ancient Greece and remain instructive centuries after appearing in print. These short sayings were a way to compress human experience into something memorable enough to pass from one generation to the next. They warned us not to count chickens before they hatch and cautioned us not to cry wolf. The fox and wolf make frequent appearan

You know how you can watch a movie or read a book the second time and see and learn much more? In 1970, three astronauts left Earth aboard Apollo 13 with the clear objective of landing on the Moon. Two days later, an oxygen tank exploded, and Tom Hanks, playing commander Jim Lovell, delivers one of the most recognizable lines in movie history: “Houston, we have a problem” (very close to the actual transcript). And from that moment forward, everything changes. The spacecraft w

Think of buying a stock as being one of the Green Bay Packers' famous fan-owners—you wear the cheese head, celebrate wins, and loathe the Minnesota Vikings. All are requirements. I know; I grew up in Wisconsin. Bonds are different. Buying a bond is like the bank or other lenders funding Lambeau Field's stadium expansion, where you care little (or not at all) about the scoreboard as long as your loan is paid back with interest. For decades, the 60/40 portfolio has been a famil

Required Distributions (now RMDs) from qualified pre-tax retirement accounts are not new and not a byproduct of the Secure Act only, which created an unheralded tax surprise by eliminating the ‘Stretch IRA’ lifetime distribution for inherited IRAs. Although RMDs are important, the financial services conversation often gives them more independent power than they have. A Required Minimum Distribution is just the amount of money the tax rules require you to withdraw each year fr

Social Security has been redesigned many times, but almost every serious proposal for fixing it eventually reaches the same short list of choices. Collect more money. Pay less than currently scheduled. Start benefits later. Change how benefits grow. Invest the money differently. Or combine several of them. The 1983 reforms did that. Congress increased revenue, changed taxation of benefits, delayed cost-of-living increases, and gradually raised the full retirement age. It was

Are we actually debating how to save Social Security—or are we debating who should pay for keeping the version of Social Security we want? We should ask if members of Congress read history. It helps to go back to the beginning. When Social Security became law in 1935, workers and employers would each pay a 1% payroll tax on the first $3,000 of wages. Those rates were scheduled to increase over time, reaching 3% each by 1949. Monthly retirement benefits weren’t scheduled to be

Our recent newsletters have described tax drag and the hidden tax increases that can quietly reduce spendable income. The widow’s tax belongs in that conversation, although the name is misleading. There is no line on a tax return labeled “widow’s tax.” It is what can happen when the tax system begins treating one surviving person very differently from the married couple who planned their retirement together. The numbers behind the risk are surprisingly stark. The Centers for

Tax planning will be more successful when we’ve found the sources of pressure on household budgets. Some are obvious and others hidden. In Part 1, we addressed actual taxes and tax sources, a category that includes many hidden expenses such as past-era Social Security tax brackets. Second are government or regulated expenses that behave like taxes. Health care is a good example. The average cost of employer-sponsored family health coverage has risen sharply since 2017. Family

Roth IRA conversions and Required Minimum Distributions on traditional retirement plans are hot topics (and sales topics) in financial services right now. For most families other than those with serious health challenges, taxes are the biggest retirement risk we face. And these are important tax topics with a lot of bad information. Federal tax rates and policies tell only part of the tax risk story ─ whether people are keeping more of what they earn. Congress can lower incom

Most of us understand risk management better than we think, but we have a harder time moving from understanding to application. If you decide to eat better, you probably do not change your diet, start exercising five days a week, completely reorganize your schedule, go to bed two hours earlier, and eliminate every bad habit on Monday morning. You make one change, stick with it until it’s consistent ─ a habit. Then you make another. The idea shows up in books such as The Compo

In 1897, C.W. Post introduced Grape-Nuts and tucked a little pamphlet into early cereal boxes called The Road to Wellville. The claims were, by modern standards, ambitious. The cereal was promoted as a food that could cure ailments, sharpen the mind, and even make “red blood redder.” Grape-Nuts survived its medical career. What endured instead was something less dramatic: consistency. More than 125 years later, the company reports that Grape-Nuts is still made from essentiall

The Federal Reserve voted this week to keep its main interest rate unchanged. Nine members supported the decision. Three wanted rates raised because they remain concerned about rising prices. That was an unusually divided vote, especially early in the term of Fed Chair Kevin Warsh. Within minutes, banks, economists and market experts began explaining what it meant. Some predicted a rate increase in September. Others said the Fed may remain on hold. Stock, bond and currency ma

Most of us have a short list of financial assets that have become conversation shutters. Ask about them, and we’re inclined to not only stop assessing them but to also lose trust in the conversation. We have enough evidence to make these ‘red flag’ categories legitimate targets. Common ills are complexity, illiquidity, aggressive selling, high fees, disappointing past experiences (often failure, such as oil partnerships or private credit), or promises that sound too good to

The World Club final will host power teams Argentina and Spain in the championship match. Years ago, our family hosted a high school student from the Basque region of Spain. He played pickup ‘soccer’ (to use the American label) with my son’s team, so we saw him dribble and play, and we can confirm the football crazy culture that is Spain. We took our student visitor to the St. Croix River near our home, a town with a steep bluff climbed by stairs that lumberjacks (and bar pat

One of the quiet risks in retirement planning is not just the death of a spouse. It is what happens financially after the first spouse dies. People often call this the “widow’s penalty” or “widow’s tax.” It is not an actual IRS penalty, but the practical result of two things happening at the same time: household income might go down, while the surviving spouse might be pushed into a less favorable tax situation. Consider a retired couple with two Social Security checks, some

A technology expert recently told the story of losing a large sum of money after receiving what looked and sounded like a legitimate call from his bank. The caller knew enough to sound believable. The caller had “security codes” that made it seem even more so. By the time the victim realized what had happened, the codes he thought were protecting his account had helped authorize the theft. Security professionals say many of us misunderstand a key part of online theft: modern

I’ve spoken with many folks who retire from work or sell a business, enjoy the uncommitted time for a while, then express regrets over leaving a year, three years, or five years down the road. “If I had known my health would be good…” Consider a hybrid retirement. Or a phased exit from your business. This option helps answer personal questions and readiness questions, but it also opens the door to interesting Required Minimum Distribution (RMD) planning. At age 73 (or another

The IRS has a plan for drawing down your IRA. Do you have one? How much is spendable depends on many moving parts, to be addressed before and after retirement, and that useful period between retirement and the time when Social Security and RMDs begin. At a certain age, the IRS stops waiting. It requires money to come out of qualified (before-tax) retirement accounts, whether the account owner needs the income or not. For some retirees, the RMD is welcome cash flow. For others

Three questions can turn an ordinary inherited IRA into a bigger tax problem. Who was named as beneficiary? Had the IRA owner already started required minimum distributions? And was the beneficiary a real person, a trust, an estate, or simply left blank? These primary questions determine whether a family has ten years or five to drain an inherited IRA, or in some cases a different payout schedule altogether. Since the SECURE Act, most people have heard about the “10-year rule

A new hospital building is rising three miles from my home. Communities in the service area are growing and aging, so I’m betting the financial projections for a project this costly passed stress tests with room to spare. Because I drive past the site often and work with many health industry folks, construction of these capital-heavy projects always gets my attention. The new facility might well be essential to hold market share in our competitive health care market. But the