Ep. 123 Launch Financial- Markets Bracing for the Fed’s Next Rate Hike

Overview: Tune into this week’s episode of Launch Financial as we discuss how the markets are on track for their best January since 2019. The markets are now bracing for the Federal Reserve’s interest rate hike annoucnement at the conclusion of their two-day meeting tomorrow. All eyes are on earnings, especially from mega-cap tech firms. For inquiries or questions, email info@shermanwealth.com. 

Show Notes:

https://twitter.com/LizAnnSonders/status/1620391496892416001?cxt=HHwWgoCwlebe5PwsAAAA 

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Ep. 120 Launch Financial- Food Prices Continue To Surge As We Await More CPI Data

Overview: Tune into this week’s episode of Launch Financial as we discuss interest rates and the market as we await December’s inflation report later this week along with comments from Fed Chair Jerome Powell. As consumers take note of record high food prices, American’s credit card debt remains higher month to month. Check out our social channels @shermanwealth later this week for our take on December’s CPI report. 

Show Notes:

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Ep. 117 Launch Financial- November Inflation Report Comes In Lighter Than Expected

Overview: Join us on our inflation episode of Launch Financial as we discuss November’s CPI report that came in lighter than expected with energy prices declining but shelter and food costs increasing. All eyes are on the Federal Reserve tomorrow to see what the future is for interest rate hikes. Email info@shermanwealth.com with questions or inquiries. 

 

Show Notes:

https://twitter.com/LizAnnSonders/status/1602658533190893568 

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What To Do With Your Old 401(k)

401k blog image

As we approach the end of the year and many individuals are either settling into a new job or thinking about starting a new job at the start of next year, we’ve been getting many questions about what to do with old retirement accounts. This is a great question that is oftentimes not discussed, causing many people to “forget” or lose track track of their old accounts. Many people often make rushed decisions and think they need to pack up their savings when they leave a job.  And conversely, some people pay no attention when they move from job to job and leave a trail of 401(k) plans behind them.  With any employment change, it’s important to know which mistakes to avoid when it comes to your 401(k).

Here are some tips regarding your 401(k). First and foremost, pause before simply cashing out on your 401(k) when leaving a job. Cashing out and not reinvesting your funds in a qualified retirement plan is a mistake.  People don’t realize the cost to their financial security by cashing out on their 401(k) and that cost includes an immediate tax hit – income taxes plus another 10% early withdrawal penalty if you are younger than 59 ½.

One thing to be weary of is not to roll over your accounts too many times. Employees who decide to move their money to another 401(k) plan or an IRA typically have two options—transfer the funds directly to another account, or do a rollover. Although “rollover” is when you move money from one retirement account to another. That money is best moved by direct transfer, but some employers will send a check. You have 60 days to roll that money over to an IRA or other qualified plan. If you miss that window, there is a grace period (with a penalty fee), but this is offered only once every 12 months, so direct transfers are often best to avoid penalties and issues. 

There are plenty of good reasons to move your money into an IRA (individual retirement account).  These accounts aren’t linked to any one employer and consolidate your money into a single retirement account. You also are not confined to that employers or old 401(k)s fund lineup, so may have more flexibility moving over to an IRA.  However, your employer’s plan may offer you access to investment options, tools and institutional pricing that you might not get with an IRA so it’s important to analyze that beforehand. 

Next, make sure not to overlook other tax strategies. There may be other strategies to consider when weighing a job move, although most people associate 401(k) plans with pretax contribution. One option may be to convert the savings to a Roth IRA; you’ll owe income taxes on what you convert, but future growth and withdrawals will be tax free. If your income is lower that year, the tax impact will be less.  For those who’ve accumulated their employer’s stock in their 401(k) plans, leaving a job may open the door for an often overlooked tax break. 

As we enter the last month of the year, make sure you have all your November 2022 statements for your old 401k plans, and use this opportunity to evaluate and understand what you have and your options. Keeping regular tabs on what is going on with your investments is critical to ensuring they line up with your goals for the future.  For more specific advice on what to do with your old retirement accounts, email, info@shermanwealth.com

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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