Ep. 115 Launch Financial- Giving Tuesday At Sherman Wealth

Overiew: Join us today on Giving Tuesday as we discuss Thanksgiving at Sherman Wealth and how we participated in giving this holiday season. As we wrap up what looks like a positvie month in the markets, we want you all to check off your end of the year planning lists and make sure you are prepared for the year to come. 

Show Notes:

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End Of The Year Financial Contributions & Checklist

It’s hard to believe, but the final quarter of the year is now upon us. As 2022 comes to a close, here are some key money moves you can make to finish the year off strong and set yourself up for success in 2023.


As we head into the final months of the year, it may be a good time to gather your important financial documents, preferably into once place such as an automated financial planning software. Once your financial data is organized, analyze it, take a look at your spending, budgets, and cash flow, to make sure you are on track to reach your financial goals for the year. Then, implement any necessary changes. Additionally within this process, take some time to set new financial goals for you and your family for the upcoming year.


Given the extreme market volatility and economic uncertainty we’ve seen this year, this task is more important than in previous years. If you are working with a financial professional, ask them to tax loss harvest your accounts to capture losses, and rebalance your portfolio. As mentioned above, given the extreme market volatility the markets have been facing, make sure your asset allocation is right for you, that you are comfortable with your portfolio during the highs and the lows. Even if you’ve found the perfect asset allocation for your investment portfolios, its important to revisit your allocations periodically and do a portfolio review. Overtime, your investments may perform differently than you expected, which will change your intended allocation.


If you’re planning to max out your 401(k) for 2022, mark your calendar for December 31st, as this is the last chance to do so. The IRS just announced retirement contribution limits for 2023, so check those out as your project your budget for next year. If you receive an end-of-the-year bonus, you may want to consider putting as much of it toward your 401(k) plan as you are able to. Additionally, if your company offers a match, make sure you are contributing at least the match to take advantage of those essentially free dollars.

If you are HSA eligible, make sure you are contributing to your HSA before the end of the year. Lastly, if you have young children, hopefully you are already contributing to a 529 plan to help pay for college when the time arrives. If not, now is the time to set one up. If you already have an account set up, make sure you remember to make your annual contribution. 529 plans have varying deadlines set by the state, but many have a December 31 cut-off. If you miss the end-of-year deposit deadline for your plan, you could be missing out on significant state tax breaks. 


A Roth IRA conversion involves transferring retirement funds from a traditional IRA or 401(k) into a Roth account. Since the former is tax-deferred while a Roth is tax-exempt, the deferred income taxes due must be paid on the converted funds at that time. There is no early withdrawal penalty. Inquire about whether a Roth conversion is right for you. 


Donor-advised funds are tax-deductible financial accounts provided by 501(c)(3) nonprofits who are approved, donor-advised fund sponsors. The funds are opened in the donor’s name, and they enable a donor to donate funds and get a tax-deduction immediately while deciding later which organization those funds will support.

After you set up a DAF, you can add money or appreciated assets into one of these funds and receive a tax deduction for the money or assets on the day you put them in the fund. And then, any time in the future — whether one day or ten years later — you can give the money out to any charity of your choosing. Check out our podcast with Elizabeth Goldstein regarding Donor Advised Funds and how to get involved.


Now is a good time to revisit the annual subscriptions you are paying for. Do you really need Netflix, Hulu, Apple TV and other streaming services at the same time? You might be able to cut down on some of your monthly expenses by taking a good look at what you are actually using vs. what you are paying for. You’d be surprised at how these services add up so it’s a good time to assess what you might be able to save money on in the upcoming year.

Finally, now is a great time to schedule a meeting with your financial advisor to review your year-end financial planning. It’s important to have that meeting before year-end to set the stage for a financially successful year in 2023. Besides the list mentioned above, there are tons of other tasks you may need to check off your list before the end of the year so let us know if you need any help!  If you don’t currently have a financial advisor and would like some help with your year-end planning, please contact us for a free 30-minute consultation today! 

The Value Of Ongoing Financial Advice

As financial advisors, we work with individuals everyday to deliver value and financial advice. At Sherman Wealth, we specialize and focus on customized financial advice and plans. We often discuss the difference between DIY “do-it-yourselfers” and financial advisors. One very important differentiator between the two is the value of the advice.

We believe that financial advice is most successful when it’s built on a relationship. The reason we strongly believe in customized plans is because no investors are alike. Therefore, it’s prudent to work with someone you not only trust, but who will create a plan that is specific to and will reflect your goals and needs and adjust them as they change over time.

When looking for the right advisor to provide you advice, make sure they can help in these three overarching areas: investments, planning, and ongoing advice. I’d say one aspect many individuals don’t focus on is the ongoing advice component. We always tell our clients and prospects that a one-time financial plan is just a roadmap and snapshot in time. While that snapshot and roadmap will lay the foundation of your financial future, life is complicated and changes overtime. It’s important to have a trusted individual stay the course with you, jump the hurdles, and adjust your advice as your life becomes more complex.

A timely example of needing ongoing advice is this year. As we’ve been writing about, this year has been off to a very rocky start, and the markets have been digesting lots of uncertainty creating extreme volatility. With inflation at all time highs, the Federal Reserve raising interest rates, and individuals adjusting to this economic environment, ongoing advice is prudent. We’ve been working with individuals to adjust their budget to this higher cost of living, as well as revisiting cash ideas and asset allocations based on risk tolerance. If you’ve felt financially uncertain during the course of this year, this is your sign to consider an advisor who will provide you with ongoing advice. If you have any questions and are seeking either a one-time financial plan or an ongoing relationship, email us at info@shermanwealth.com or schedule a complimentary intro call here.

Here’s Why To Consider A Donor Advised Fund

With the holidays and Thanksgiving around the corner, it’s a great time to discuss giving back to those in need. At Sherman Wealth, we are very charitably inclined, so we want to discuss how setting up a donor advised fund could be a good option for you and your family. For those who don’t know, a donor advised fund is a charitable investment account that you can open for the purpose of supporting organizations and charities of your choice and that you care about.

Donor advised funds allow you to be very creative in making your tax-deductible donation. You can donate cash, stocks, RSU’s, or non-publicly traded assets. Once your money is in your account, you do not have to donate it right away, you can let that money grow within the account, tax free, until you are ready to donate it.

Interestingly enough, we read an article stating that Fidelity Charitable and Schwab Charitable donors gave record amounts of money to support non-profits in 2020, inspired by a desire to help those suffering during the pandemic.

Fidelity Charitable said its donors made 2 million grants totaling $9.1 billion to 170,000 charities in 2020, a 24% increase in the amount of money donated and a 31% increase in the number of grants compared to 2019. According to the company VPs, the pace and the amount of giving stood out compared to previous years. The pandemic changed giving targets, as donors supported organizations that provided food and other necessities for people who experienced economic setbacks due to the outbreak.

For those who have unique tax situations and are also interested in charitable giving, you can contribute funds into a donor advised fund, which will allow a donor to make charitable contributions, receive a tax deduction and then distribute the money over time. It is a great way to benefit your tax situation while also supporting your favorite charities. It was so incredible to see such an outpouring of love and support to those in need during such a difficult time. If you are in a position to do so, we always encourage others to consider giving back to those in need or setting up a donor advised fund. If you have any questions about setting up a donor advised fund or charitable giving, please reach out to us at info@shermanwealth.com or schedule a complimentary 30-minute meeting.

Things To Do In A Market Correction

As we’ve been making our way through this market correction and this interesting economic environment with the Federal Reserve raising interest rates to combat inflation, we’ve been getting many questions about which financial moves you should be making and which ones to avoid. While market volatility can be stressful and scary for us all, the way in which you approach and react to the fluctuations in the markets themselves can say a lot about your portfolio and investments. So, let’s jump in. 

First and foremost, it is important not to panic and make sure you stick to your long-term plan when the market is going through a correction period. We know it’s easy to get caught up with the media and headlines, tempting you to derail your financial plan and allocation during volatility and market downturns. As we have seen time and time again, your long-term strategy will most likely stay the course through the ebbs and flows of the market. As long as you choose an allocation that works for you in market highs and lows, then sticking to it for the long-haul is the right move. Don’t obsess over the markets – they will always do their own thing.

If you do happen to have some extra cash sitting around right now, we’ve been talking with many clients and prospects about the attractiveness of CDs, treasury bills, and high yields savings accounts for more liquid cash and then of course putting any other money thats available to work in the markets! Dips in the markets are good opportunities to enter or invest more if you are comfortable with your overall risk.

However, if you find yourself having trouble sleeping at night through all this volatility, it might be a sign that you have too much risk in your portfolio. Maybe think about re-allocating your portfolio or working with a professional to feel more comfortable about your situation. It’s extremely important to understand your risk tolerance before investing to ensure that you can handle the investments you are taking on. If you would like access to our complimentary risk tolerance questionnaire software, email us at info@shermanwealth.com to learn more or click here

If the COVID-19 pandemic taught us anything, it’s the importance of having a plan in place for when life throws uncertainties and hardships our way. If you do not have a financial plan, NOW is the time to implement one. We’ve been working with many clients on end-of-the-year financial and tax planning, revisiting budgets, setting goals, and projecting for 2023.

Not only is it smart to have a financial plan set in case of emergencies, but you should also have an estate plan set up. For more resources on how to get started on estate planning, check out our blog here. Remember, long-term plans are put in place for a reason, so try not to panic and do not derail your plan in the presence of volatility. Also keep in mind that everyone’s personal and financial situation differs, so make sure not to confuse your time horizon with your friend or next door neighbor. If you find yourself nervous or anxious during this time or even feel comfortable but have questions, we are here to help. You can send us an email at info@shermanwealth.com or schedule a complimentary meeting here.

Are You Taking Advantage Of Your 401(k) Employer Match?

Does your job offer workplace benefits? If so, are you aware of the benefits available to you and are you taking advantage of them all? We’ve been working with many individuals who are not only unaware of the extent of their benefits but are also not utilizing some great opportunities for them, especially their 401(k) employer match. Let’s take a look at why individuals are not taking advantage of this benefit and why it’s prudent to.

We’ve found that many employees are not educated on their benefits and therefore do not know how some of these added comps can benefit them. If your employer offers a 401(k) match, they are basically offering you free money. So, why wouldn’t you take it? Even if you are not able to/or want to max out your 401(k), contributing at least the employer match will help you make the most out of your retirement savings and take advantage of a really great company perk. Let’s break down how it works. Say your employer match is 4%. So, if you contribute 4% (or more) of your salary towards your retirement account, each pay period your employer will also contribute 4% on your behalf. 

Keep in mind, if you are starting a new job,  it’s important to speak with your employer or HR to determine when you are eligible to contribute to your company retirement plan and if the employer match is immediate or there is a waiting period. Additionally, many people are unaware that in 2022 they can contribute up to $20,500 of pretax income to a 401(k), so there’s a real opportunity to save throughout the year and getting closer to the limit quicker. 

Another issue we have seen as it relates to workplace benefits and retirement accounts is misplacing or forgetting about old 401(k)s. We know starting a new job can be a stressful time with many moving parts; however, it’s important that you don’t forget about your old 401(K) account. When switching jobs, you have a few options. First, you can roll the old retirement plan into your new 401(k). Other options are to leave the retirement plan where it is, roll it into an individual retirement account (IRA), or cash it out (however, depending on your age early withdrawal fees may apply). Oftentimes, it’s very helpful to analyze your old 401(K) and new workplace benefits to see which option is best for you. If you have questions about an old 401(K) or retirement account and would like our help analyzing your options, please let us know. Additionally, If you are an employer and are looking for a workplace benefit education course, email us at info@shermanwealth.com as we are happy to work with your employees to educate them on all the options available to them. Click here to schedule a complimentary intro call.