Capital Insights

Know the Rules to Avoid 529 Distribution Mistakes

As a continuation of one of our recent blog posts on 529 accounts, we now wanted to focus in on the various rules for distributions from those accounts. 529 plan account owners can withdraw any amount from their plans, at any time, but only the qualified distributions that we previously referenced (i.e., for college expenses, $10,000 per year for K-12 tuition/fees, etc.) will be tax-free.

Behavioral finance: How our subconscious beliefs impact our real-world dollars

Have you ever found yourself struggling to stick to a budget, despite your best efforts? When an investment you picked does particularly well, do you notice how proud you are? And if it underperforms, it is clearly due to unforeseeable economic conditions, right? If an unexpected car repair pops up – do you find yourself carrying that balance on a credit card rather than drawing on your vacation savings to cover the expense? Each of these scenarios gives us a peek into how our psychology influences our financial choices, for better or worse. The good news is that you can learn to recognize common missteps and consciously choose to adjust your strategy with behavioral finance.

529 Accounts: The ins and outs of qualified expenses

As you may know, 529 accounts are a great savings vehicle for many individuals to save money for education. The IRS allows funds in this account to grow without being subject to tax until a distribution is made, and depending on the type of expense, the proceeds can even be tax free! To determine the taxability of the distribution, the IRS looks at the purpose of the expense and groups them into two categories: qualified and nonqualified expenses.

Impact of children on your financial path

When thinking about your future, there are many factors and life choices you will have to plan and save for—whether that’s purchasing your first home, buying a car, or growing your retirement nest egg. Starting your family is one of the most rewarding experiences in life, but it carries some significant financial costs. No one wants to financially evaluate having a child the same way they would the purchase of a car, but it’s incredibly important to plan ahead.

Are you actually in good hands? Risk and umbrella liability insurance

People often think that their car insurance and/or the liability insurance policy on their home will protect them from personal liability or if they get really hurt. The thing is, these policies can provide protection, but may not provide enough protection. Most of my clients do not have sufficient insurance. Are you one of them? As a personal injury attorney, I look at hundreds of policies every year for my clients and the people who injured them.

Building Back Better: New Administration Bets Big on the Economy

President Joe Biden formally announced his COVID-19 stimulus plan on January 14, 2021, and on March 11, 2021, it was signed into law, making it the first major milestone this administration has delivered in line with its’ campaign promises. With a $1.9 trillion relief package, this bill reaches far beyond the pandemic response of the past year and gives us a picture of what the new administration has planned for the economy.

Financial Spring Cleaning

Are you a hoarder?  Did you just put that Pepco bill away last month and see that the one all the way in the back was from 1992?  Spring is right around the corner.  It’s the time of year when we seem to find extra time to clean our houses. Sure, the carpets need cleaning, and the sun needs to shine through clear windows, but what how about those bank statements and tax documents that we’ve been storing for the last 20 years?  Perhaps it’s the time to tackle those, unclutter the drawers and recycle some paper, too!  

To buy or not to buy: Is that the question?

We’re all quite familiar with the idea of the American Dream at this point. The house, the white picket fence, a dog on the porch, and 2.5 kids playing in the yard. While this may sound archaic to some, it’s still a deeply held wish for others. So, how does one go about answering the central housing question: should I rent or buy? The answer (as with many big questions) is, it depends.

Are You Better Off with a Roth?

While you might already be invested in an employer-sponsored plan like a 401(k), an Individual Retirement Account (IRA) allows you to save for your retirement on the side, and potentially save on taxes. However, there are two different types of IRAs: traditional and Roth that each have different rules and benefits.

ESG and SRI Investing: 2020’s Silver Lining?

As the dust settles on a year that was like no other, we can now look back at 2020 and see where we stand today. Although the pandemic highlighted a rather terrible year overall, it wasn’t bad for investing and, relatively speaking, it was another good year for socially responsible investments (SRI). Looking at equity investments specifically, three out of four sustainable equity funds beat their Morningstar Category average in 2020, and far more sustainable funds finished the year with performance that ranked in the top quartile (42%) than in the bottom quartile (6%).