With the presidential election a little more than a month away, we could be on the brink of change; we could be on the brink of higher taxes, and we could be on the brink of sequestration. But again, perhaps we are not. With so much noise, how do you tell what matters, as far as your investments are concerned? We are constantly asked, “How do you modify a portfolio to take advantage of where we are right now?”
We maintain that you should continue investing for the long term. Money you need now should not be in the stock market. Only money you do not need for more than 10 years should be invested. One change you may want to be conscious of is which accounts you use for high dividend stocks. If you have an IRA with growth stocks, you may want to shift the holdings to more dividend paying stocks. Likewise, taxable brokerage accounts may take on a growth profile.
Regardless of the outcome in November, once the election is over, there should be plenty of time to make financial moves before the end of the year. We suspect the market will be a bit turbulent between early November and December 31.
If you have a portfolio and are overweight in a stock, you may consider trimming the position and recognizing capital gains this year. However, there should be plenty of time for you to do that after the election. We feel there is no need to make knee-jerk decisions today. We also believe, however, that taxes will not be lower than they are today. And in some instances, you can take advantage of that now.
Currently, estate and gifting taxes have an exemption of $5.12 million. While the future of the estate tax is unknown, you should begin talking to an estate planning attorney now, if you have a substantial estate. There may be moves you can make now to take advantage of the current low rates.
Overall, if you feel overwhelmed by the unknown, now is the time to make appointments with trusted professionals—your C.P.A.s, financial advisors and estate planning attorneys. While you may not make decisions today, you can begin having a professional look at your wealth to help you plan for the future.
At Henssler Financial we believe you should Live Ready. If you have questions regarding your financial plan, the experts at Henssler Financial will be glad to help. You may call us at 770-429-9166 or email at experts@henssler.com.
Disclosures
This article is meant to provide valuable background information on particular investments, NOT a recommendation to buy. The investments referenced within this article may currently be traded by Henssler Financial. All material presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. The contents are intended for general information purposes only. Information provided should not be the sole basis in making any decisions and is not intended to replace the advice of a qualified professional, such as a tax consultant, insurance adviser or attorney. Although this material is designed to provide accurate and authoritative information with respect to the subject matter, it may not apply in all situations. Readers are urged to consult with their adviser concerning specific situations and questions. This is not to be construed as an offer to buy or sell any financial instruments. It is not our intention to state, indicate or imply in any manner that current or past results are indicative of future profitability or expectations. As with all investments, there are associated inherent risks. Please obtain and review all financial material carefully before investing. Henssler is not licensed to offer or sell insurance products, and this overview is not to be construed as an offer to purchase any insurance products.
