“Financial Fitness” with Ashlea (Kleitsch) Jones – “Have no single point of failure. Have no single path to success.”

Discipline is hard any day of the year but especially in the summertime and weekends when there are so many FUN things pulling at us. When you get to retirement, summertime and weekends are seven days a week so you also want to be able to fund your fun when the time comes.

Clients might be entry-level investors, or saving for/entering retirement, or considering legacy/estate planning for the next generations. They might be very conservative, or they might be a 15 on a risk scale of 10. They might have a net worth of $100 or a net worth of $100,000,000.

Each client comes with their own unique ambitions but there is one commonality amongst everyone we visit with: they wonder if they are doing enough to reach their potential.

There is definitely no one-size-fits-all approach to helping people reach their financial ambitions. However, for the most part, just getting assets saved in the first place is the biggest component of getting to where you hope to be. Sometimes we see people get hung up on exactly which type of account to open or what type of investment(s) to back. Generally, saving a balance amongst a few different allocations is the best start. From there you can modify or get more tactical based on your needs.

Brokerage Account: Closest relation to a savings account. Most freedom. No limitations on what/when you put in or what/when you take out. Pay taxes on growth once realized or deduct against taxes on losses. Typically inherited at a stepped-up basis on the date of dependent’s passing.

Roth IRA: Grows TAX FREE (upon decumulation after 59 ½ years old. Anything prior is 10% penalized). After the account has been open for 5 years it can pass to beneficiaries TAX FREE. Contribute a max of $7,000/year (or $8,000 @ 50 years or older) Income limitations apply to new contributions but tax-deferred assets can be converted at whatever amount you’re willing to pay taxes on, regardless of income. (ROTH 401k contributions fall under 401k rules and do not apply towards the IRA max.)

Traditional IRA: Grows tax DEFERRED. 100% taxable at decumulation. Anything taken before 59 ½ is penalized 10%. Start as soon as you have an earned income of as much as you contribute. Contribute a max of $7,000/year (or $8,000 at 50 years or older) Income limitations apply to new contributions. (401k contributions fall under 401k rules and do not apply towards the IRA max.)

Within each of these options, you might be invested in mutual funds, ETF’s, individual stocks, crypto, private funds, venture capital holdings… and there are a myriad of options within each of those asset classes. This is where an advisor can really help narrow down which path or combination of paths can expedite your chance of success.

“Be disciplined in your goals but flexible in your approach.” Having discipline and staying flexible probably sounds contradictory. But in many ways, it can be the perfect balance to success. When we can dial in this balance and keep an eye out for necessary pivots on behalf of our clients, we can literally change lives and create legacies. You can come from a whole lot of nothing and have a whole lot of something with a little guidance, focus, and intention. We know it because we’ve seen it and, in many cases, have been blessed to be involved in it. It can feel intimidating to expose your statements and goals. But if you wonder if there is more out there, it is worth taking the leap and having a fresh set of eyes on your ambitions.

The best part of what we do is getting our people to feel good about how far they’ve come and open to how far they can go. We want you to feel as excited about your financial life as you do about your summertime plans!

Financial Advisor
Prime Capital Financial
Cedar Rapids, Iowa
primefinancialcedarrapids.com
(319) 269-7143