Tips to Help You Prepare for Retirement

When you are in the prime of your life, retirement may seem like a long way off in the future. Maybe this perception is the reason why 60 percent of Americans haven’t determined how much they’ll need for retirement. However, if you want to enjoy a financially secure retirement, now is the best time to start.

How Much Money Will You Need?

Everyone has different needs and expectations. Nevertheless, considering the average spends 20 years in retirement, the Department of Labor calculates that you will need between 70 to 90 percent of your pre-retirement income to continue your standard of living through your retirement years.

For example, if you earn $5,000 a month, you’ll need a little over $1.2 million to maintain your living standard for 20 years. Social Security benefits will cover about $370,000 of the $1.2 million. So you’ll need to save about $830,000 to maintain your living standard at that income level.

Saving over $800,000 may seem like an impossible task, but it is more achievable than you may think. For example, if you start saving $500 a month at age 25 in a Roth IRA account with a 7% return, you’ll have $898,358 by age 65. If you’re 35 years old, you would need to double your monthly contribution or work 10 years longer to reach that amount.

How to Get Started With Your Retirement Plan

When you make up your mind to start the process, you can begin by setting goals. Primarily, decide how much money you can realistically save in a month and how much money you want to save by retirement. Once you have set some concrete goals, you can use the following tips to prepare for a financially comfortable retirement.

Assess Your Net Worth

To assess your financial condition, you need to calculate your net worth. You can do this by tallying up all of your assets, such as your house, car, investments, and cash. Then, deduct all of your outstanding debt, including your mortgage, car payments, and student loans. Knowing your net worth is important because it is the focal point of your financial profile.

Even if you can only save $60 a month, you should start saving that amount until you begin contributing more. Before paying your bills, groceries, and other expenses, deduct your monthly savings from your paycheck and place it in a separate account until you find a retirement account with the best return.

Grow Your Savings with a 401(k) Plan

Check with your employer to see whether they offer a 403B or a 401(k) plan. Over the past five years, the average 401(k) account has had a healthy 9.5% return rate. Obviously, it is important that you continue to commit funds from your paycheck even when the markets are negative, or in a prolonged slump. In fact, it is even more important then! If you continue to add funds in negative market environments, you will be buying more shares of the depressed funds that performed so well in previous years. Then, you will have a lot more shares when there is a recovery, and over time this will give you better results. This concept is referred to as “dollar cost averaging” and it works well over longer periods of time. Also, you can make it easier to save by allowing your employer to direct deposit funds from your paycheck to the 401(k) account automatically, every pay period.

Some companies will match a certain percentage of your contribution to the 401(k) plan. Typically, most companies match 50 cents to the dollar up to 6% of your pay. Also, your employer may offer an automatic escalation feature that will automatically boost your contribution by 1% each year.

Contribute to An IRA

You can open an Individual Retirement Account (IRA) or Roth IRA through your bank or brokerage. The yearly contribution limit is $6,000 for customers under 50 years old and $7,000 for people over 50.

In a Roth IRA, your after-tax contribution appreciates tax-free, and your withdrawals are penalty and tax-free after you reach 59½ years old. On the other hand, you must pay taxes on your traditional IRA balance after age 59½ at whatever the current tax rates are then.

Take a Part-Time Job

Working a side job would help you earn extra money to increase your monthly contribution. Within the gig economy, businesses offer many job opportunities with very flexible work hours. Try searching online on sites like ZipRecruiter.com, FlexJobs.com, and Career Cloud.

Select a Debt to Pay Off

You can add to your retirement savings by paying off one of your debts ahead of schedule. Then, along with saving on interest expenses, you can assign the money you’ve already designated for the loan payments to your retirement account. For example, you can accomplish this task by adding $100 a month to your debt installment until you ultimately pay off the debt.

Use a Finance App

Free downloadable finance apps can help you track your spending, manage your debt, and organize your budget in a streamlined manner. Additionally, they can enhance your financial knowledge through the tutorials as you use them. Overall, the best apps for this purpose are: You Need a Budget (YNAB), Mint, Simplifi by Quicken, PocketGuard, Goodbudget, and Stash.

Open a Social Security Account

Suppose you want to determine how much in Social Security you will get at retirement. In that case, the Social Security Administration allows you to set up a My Social Security Online Account, at www.ssa.gov . It is a valuable tool for learning about your Social Security benefits and keeping tabs on your future benefit amount.

If you want to make the best of your retirement years, there is no time like the present to get started. So many options and resources are available to you that prior generations didn’t have. Once you begin, you will discover that managing your retirement plan is not as complicated as you thought and that reaching your retirement goals is possible. Patience and even being stubborn in rough periods are key!

How Do Cryptocurrencies Work, and What is the Impact of the China Ban?

On September 24, 2021, China’s central bank issued a statement explaining that all virtual currency-related business activities were illegal from that moment on in the country, effectively placing a nationwide ban on cryptocurrency transactions. The announcement came amid a largescale crackdown on the trillion-dollar cryptocurrency industry by the Chinese government.

According to the statement, which was published on the People’s Bank of China website, all financial institutions, Internet platforms, and payment companies in China will be banned from enabling cryptocurrency trading. The People’s Bank of China also seeks to target foreign exchanges, banning foreign entities from providing virtual currency exchanges for Chinese residents via the Internet.

What is cryptocurrency?

Cryptocurrencies are virtual assets that are bought, spent, sold, and traded via digital exchanges. Also known as crypto assets, they are cryptographically secured representations of value capable of being traded or used to pay for things.

Cryptocurrency does not represent a physical asset, so it has no intrinsic value, just as paper, or fiat currencies have no intrinsic value. The user of the $20 or $100 bill has to have faith (along with lots and lots of other people) that that $20 or $100 will indeed buy him a certain amount of good or services. Supply and demand dictate its value. Similarly, and put simply, cryptocurrency is only worth what a buyer is willing to pay for it, making it a somewhat speculative, unpredictable asset, like paper currencies, which have historically lost all or most of their value over time.

What are the benefits of cryptocurrency?

In traditional business transactions, agents, brokers, and legal representatives can complicate and generate additional expenses to even straightforward transactions, with things like paperwork, commissions, brokerage fees, and a variety of other expenses hampering the process.

One of the main benefits of cryptocurrency is that this peer-to-peer platform enables users to effectively cut out the middle man, creating accountability and reducing the possibility for confusion. With cryptocurrency blockchain essentially serving as a large property rights database, the medium minimizes the time and expense involved in making asset transfers. It also eliminates bank transaction fees.

Cryptocurrency transactions offer enhanced confidentiality compared with traditional cash/credit systems, where an individual’s entire credit history can be viewed by banks or credit agencies. Users are shielded against the threat of identity theft, account tampering, fraud, and invasion of privacy thanks to the strong encryption techniques utilized throughout the transaction process.

Digital currencies enable anyone with a viable data connection to complete cryptocurrency transactions, increasing access to credit. Though unrecognized as legal tender in many countries worldwide, cryptocurrency does facilitate cross-border transfers without complications, eliminating costly currency exchange fluctuations, transaction charges, interest, and other levies.

Most countries operate stringent rules regulating the banking industry, protecting the rights of consumers. Nevertheless, when we deposit funds in the traditional banking system, we are effectively signing over control of our assets to a third party. If an account holder impinges the bank’s terms of service, the bank could make them jump through hoops to access their money. One of the greatest advantages of cryptocurrency is that investors are the sole owner of private and public encryption keys, effectively ensuring that they retain full control of their money.

What risks are associated with cryptocurrency?

Virtual currencies have gained significant traction in recent years, but investing in Bitcoin and other cryptocurrencies is not without risk, with some seasoned investors warning that the phenomenon is a “mirage” and a “soap bubble”, while other big name billionaire investors and hedge fund managers have embraced it, and continue to add to their holdings.

One of the main dangers of investing in cryptocurrency is price variability. As with most types of investment, values fall as well as rise. With digital currency, these fluctuations can be dramatic.

As with any popular technology, competition is a big problem. An influx of new cryptocurrency competitors have entered the market recently, an issue any Bitcoin owner is acutely aware of. Unless investors keep their eye on the ball, they could lose a lot if the cryptocurrency they invested in suddenly loses value due to the emergence of a stronger rival, as we have seen over the years with countless tech stocks and companies.

Fraud is a risk that is inherent to owning any financial asset. In terms of buying and selling, crypto investors should keep in mind that if it sounds too good to be true, it almost certainly is. Also, because cryptocurrency details are stored on computers, if that hard drive breaks down or the key file is accidentally deleted, the investor could lose access to their digital currency. Similarly, if a hacker gains access, they could steal the contents of your digital wallet, as they can with your brokerage or bank accounts.

A significant problem with cryptocurrency is the lack of regulation. Unlike conventional bank accounts, cryptocurrencies do not benefit from FDIC insurance. Plus, the US government regards cryptocurrencies as securities, applying existing laws to digital assets and obliging investors to report realized gains. In other countries, like China, crypto investments are banned.

What is the impact of China’s cryptocurrency ban on the market?

In the wake of China’s latest cryptocurrency crackdown, many major cryptocurrencies took a massive tumble in value. Bitcoin fell 8 percent to around $41,000 by 9 a.m. on the day of China’s announcement.  However, less than two weeks later, Bitcoin had recovered to over $50,000, as the concerns about China’s efforts faded.

Although cryptocurrency continues to provide the opportunity for massive gains, equally, there remains potential for huge losses, making it a high-risk, high reward strategy for speculative investors. Therefore, cryptocurrencies or “digital assets” should only comprise a small percentage of the average investor’s portfolio.

5 Financial Tasks to Take Care of the Year before You Retire

As you enter the last year before your retirement, it’s tempting to assume that all the retirement planning work you need to do is already done. After all, you’ve hopefully been able to spend decades preparing for this moment, so what could possibly be left to take care of?

The truth, however, is that the year just before you retire is not simply the kickoff to a life of leisure, but rather a crucial transition point between your working life and your post-work future. As such, you’ll need to take care of a few last critical tasks during this time to help set you up financially for your life as a retiree and ensure that the years ahead will be comfortable and worry-free.

The most important financial steps to take in the year before you retire include:

1. Updating (or creating) your retirement budget.

You’ve probably created retirement budgets before—this is usually a key step in retirement planning as it helps you figure out your savings goals. But now that you’ve reached the year before retirement, you’ll be able to create a budget that is much more accurate than previous ones.

At this point, you’ll have a clearer idea about what your expenses during the first year or two of your retirement are likely to be. For example, by now you’ll probably know whether you intend to take a big trip or make a major purchase such as a vacation home shortly after you retire. Similarly, you’ll know more about your liabilities, such as precisely how much money, if any, you’ll still owe on a home or vehicle when you stop working.

Having this level of detail about your personal finances will help this version of your retirement budget reflect reality as closely as possible. This, in turn, will help you correctly calculate your retirement withdrawals.

2. Adjusting your portfolio for income.

Speaking of withdrawals, the year before you retire is an excellent time to plan how and when you’re going to withdraw money from your various retirement accounts. You’ll need to find the right balance between ensuring that you have enough income to support yourself and avoiding running out of money during your retirement years.

Some key things to think about here include what withdrawal rate you’ll use (many experts recommend 4 percent as the magic figure, but in the current very low interest rate environment, that may be too high to be sustained), which investments you’ll plan to sell each year in order to achieve that withdrawal rate, and how you’ll manage your asset allocation so that you won’t end up having to sell investments at a loss if the market takes a turn. Hopefully, you have already established one or more income annuities or other more formalized income generation vehicles and plans before this last year of work, so that the bulk of your income in retirement will NOT involve annual sales of securities.

Note that these can be complex considerations. You may find it worthwhile to get some expert advice from a financial planner, especially one who specializes in retirement income planning, if you haven’t consulted any financial professionals prior to this.

3. Educating yourself about Medicare.

Unless you are able to set up a private alternative, you’ll likely be relying on Medicare once you’re retired and no longer covered by employer-provided health insurance. In the year before your retirement, take the time to research the ins and outs of Medicare.

Be sure you understand key details such as the four parts of Medicare and what is covered by each one, when you need to sign up, what your premiums will be, and what coverage gaps you might encounter. It’s essential to learn about your new insurance well before you have to use it.

This not only helps protect you from unpleasant surprises down the road, it also gives you the option to make strategic purchases or decisions while you’re still working, such as buying new glasses or having an elective procedure.

4. Refinancing your mortgage as needed.

If you still owe money on your home and you’re thinking about refinancing your mortgage, it’s a good idea to do this the year before you retire rather than waiting until after you stop working. Even if you have ample retirement assets, getting approved can still be easier when you’re employed.

And if you’re nervous about carrying a mortgage into your retirement, don’t be. While conventional wisdom used to hold that your mortgage should be paid off prior to retirement, continuing to make mortgage payments after you stop working is not an issue if you can do it without sacrificing your standard of living.

Furthermore, if you rush to pay off a mortgage before you retire, this could leave you without accessible funds to cover unforeseen costs or emergencies such as medical expenses.

5. Making decisions about Social Security.

Depending on how old you are when you retire, you may have a choice between claiming Social Security benefits right away and waiting to claim them later. The year before your retirement is a great time to think about which of these options would best suit your lifestyle and retirement plans.

Don’t forget to think about your health and your family history when making this decision. Waiting to claim your Social Security benefits will get you a bigger monthly check, but it won’t necessarily having you coming out ahead overall.

Many retirement planners offer a free “Social Security Maximization Study” that shows you all of the possibilities, year by year, up to age 70.

What You Need to Know about the 4 Financial Stages of Retirement

Most of the general information you’ll find on retirement planning treats retirement as if it were a single, unchanging phase that begins when you stop working and lasts for the rest of your life. However, if you take a closer look, you’ll find that retirement consists of several distinct stages, each of which involves different expenses and consequently requires a different approach to budgeting.

What this means for prospective retirees is that you shouldn’t expect a one-size-fits-all retirement plan to adequately meet your changing needs throughout the whole of your retirement. Instead, to ensure you’re making the most of your retirement savings, it’s a smart idea to review your finances as you enter each new stage of retirement, understand what to expect from the upcoming stage, and adjust your budget accordingly.

Read on to learn more about the four financial stages of retirement (as defined by Investopedia), and to find out what financial steps you should be taking at each stage.

Stage 1: Pre-retirement (approximate age: 50-62)

What you need to know—The decade or so before you stop working is known as pre-retirement or, sometimes, peri-retirement. In this stage, retirement gradually shifts from a far-off, theoretical event to a reality that is going to happen sooner rather than later. For many workers, this stage is all about clarity—i.e., getting a picture of how much you will have in savings, what your retirement income and expenses will be, and what you plan to do with your days when you’re no longer working. Note that although 62 is designated as the end of this period (62 being the earliest age at which you can qualify for Social Security payments), you might choose to retire earlier or later, depending on your circumstances.

What you need to do—The most important thing you need to do during pre-retirement is take stock of all your assets and liabilities and see if and where there are gaps that need to be bridged. Make sure you understand the details of your pension and Social Security benefits, review the balance of retirement plans such as a 401(k) or an IRA, and ensure you have a plan for paying off any money you still owe on a home or car. If things seem tighter than you’d like, take another look at your monthly expenses and see if any costs could be trimmed before they start cutting into your retirement budget.

Stage 2: Early retirement (approximate age: 62-70)

What you need to know—This is the retirement stage in which you’ll see the biggest changes to your budget as you transition from earning a regular paycheck to receiving Social Security benefits and payments from pension and other retirement plans. Many retirees also find that their expenses can be quite high during this stage as they pursue long-cherished (and costly) dreams such as taking extended vacations, purchasing a holiday home, or even going back to school.

What you need to do—As you adjust to this new stage of retirement, the most important thing to do is stick to the budget you made during the pre-retirement phase. Try not to go overboard when it comes to expenses you haven’t planned for. Remember: if all goes well, at this point you still have many more years of retirement left to finance. You’ll also need to make some decisions about health insurance, such as replacing any employer-sponsored health plans, and when you want to start claiming your Social Security benefits.

Stage 3: Middle retirement (approximate age: 70-80)

What you need to know—At age 70, there is no longer a financial incentive for delaying Social Security claims; likewise, certain types of retirement accounts will require you to start taking minimum distributions at age 72. If you’ve held off on claiming these benefits until now, therefore, you may find that your income grows during middle retirement. Many retirees also find that their discretionary expenses decrease during this stage; for example, you may find you’re not wanting to travel quite as much as you did during early retirement.

What you need to do—Now that you’re receiving Social Security and retirement plan payments, it’s a good time to revisit your asset allocation to make sure that your savings are still working hard for you. Another important financial step to take during this stage is reviewing and updating your will or estate plan. It’s not always easy to plan for the end of your life, but it’s better to take care of this sooner rather than later.

Stage 4: Late retirement (approximate age: 80 and up)

What you need to know—For most retirees, the No. 1 expense during this stage will be health care. Depending on your situation, you could find your costs increasing (for example, if you need to hire a home health aide or move to an assisted living facility) or you could find them remaining more or less the same as in middle retirement.

What you need to do—With at least several years, possibly even decades, of retirement under your belt, now is the time to reassess your nest egg and make sure you’re withdrawing money at a rate that’s appropriate for your ongoing situation. Be sure to consider not only the expenses you’re anticipating during your lifetime but also what you might want to leave to others.

6 Big Myths about Cryptocurrencies You Shouldn’t Believe

In the world of cryptocurrencies, it can be difficult to separate fact from fiction. As Bitcoin and other digital currencies have grown exponentially over the past decade, so too have the myths about Bitcoin and the cryptocurrency industry in general. This is a frustrating situation for prospective investors trying to do their homework thoroughly, as all these misconceptions can make it very difficult to find accurate, impartial information on the benefits and risks of cryptocurrencies.

If you’re thinking about investing in cryptocurrencies, or even if you’re simply a curious observer interested in learning more about this new financial sector, read on for a look at the facts behind some of the most persistent cryptocurrency myths.

MYTH: Digital currencies are mainly used for illicit purposes.

One of the most pervasive myths about Bitcoin and other digital currencies is that they are mainly used for illicit—even criminal—activities rather than legitimate purposes. Certainly, it’s easy enough to assume that the anonymity and decentralization that cryptocurrencies offer (and, indeed, that are two of their most important elements) are primarily intended to appeal to people with questionable goals in mind. However, this is to overlook the fact that anonymous, decentralized financial transactions are valued and used just as much by law-abiding individuals, to say nothing of the fact that fiat currencies are also used for illicit purposes without having doubts cast on the integrity of the currency itself. In fact, it is the US dollar that is used the most around the world for money laundering purposes-not Bitcoin!

MYTH: Cryptocurrencies are a scam.

The possibility of fraud is always a risk, however slight, with just about any investment opportunity, and cryptocurrencies are no exception. However, this doesn’t mean that all digital cryptocurrencies are nothing more than a potential scam; it simply means that prospective investors should do their due diligence carefully and cautiously to sift out dubious investment opportunities from genuine ones. Again, the fact that fraud may be a risk with cryptocurrencies—just as it is in the traditional financial landscape—doesn’t render the entire industry fraudulent.

MYTH: Digital currencies are not environmentally friendly.

Many critics of digital currencies are quick to point out that cryptocurrencies (specifically, the mining operations that produce them) are bad for the environment. But the critical follow-up question to ask here is: relative to what?

It’s certainly true that the many, many mining rigs around the world require huge amounts of computing power, which, in turn, needs significant electricity input. However, the environmental impact differs depending on how the electricity in question is generated. Recent studies have shown that at least 39 percent of Bitcoin mining activities are powered by renewable energy. Perhaps it’s more accurate to say that the carbon footprint of cryptocurrencies is a challenge in need of a solution, just as it is for all kinds of entities, from FedEx to TikTok. Also, Bitcoin’s energy usage also makes it more secure, and energy consumption is not equivalent to carbon emissions. For example, one unit of hydro energy will have much less environmental impact than the same unit of coal powered energy. 

MYTH: Bitcoin is losing its power.

As the original cryptocurrency in an industry that seems to be all about the next new thing, Bitcoin has faced rumors that it’s losing its dominance of the cryptocurrency sector for almost as long as it’s been around. However, this myth can be easily debunked by pointing out a few simple facts: Bitcoin still accounts for nearly half the total value of all cryptocurrencies in existence, and the thousands of digital currencies that emerged after Bitcoin did so with no obvious impact on Bitcoin’s price. Additionally, in just the past 6-12 months, various big-name entities have embraced and accepted Bitcoin, including large banks and brokerages, and notable hedge fund and other asset managers, and even famous CEOs (Elon Mush of Tesla) and sovereign governments (El Salvador). Other nations are expected to follow El Salvador’s lead.   

MYTH: Cryptocurrencies will displace the dollar.

Many sources, from the Financial Times to the chief global strategist at Morgan Stanley, have suggested that Bitcoin could pose a significant threat to the supremacy of the US dollar. To understand why this is a misconception, even one held by experts, it’s helpful to look at what backs these two different currency types. Cryptocurrencies, on the one hand, are backed only by the faith people have in their value. The US dollar, on the other hand, is backed by the US government. Given that investors still trust the dollar, even when times are difficult, it seems truly unlikely that cryptocurrencies will seriously challenge the primacy of the US dollar as a store of value.  It is more likely that a few leading cryptos will become stores of value themselves, or hedges against inflation akin to the more traditional dollar hedges such as gold and silver. In fact, many analysts expect Bitcoin prices to rise over time, due to a flow of money out the dollar and into Bitcoin, which has a strictly limited number of units, unlike the dollar, which is printed at increasingly alarming rates, with no real backing either.  

MYTH: Cryptocurrencies are a temporary trend.

Interestingly, claims that cryptocurrencies will displace the US dollar exist alongside parallel claims that cryptocurrencies are nothing more than a fad that will fade away. As always, the truth lies somewhere in between these two opposing myths.

At the moment, it’s not yet clear whether specific cryptocurrencies will prove to be permanent investment vehicles, but there’s no doubt that digital currencies have brought transformative and irreversible changes to the financial landscape. As the technology matures and central banks and governments around the world conduct experiments with their own forms of official digital money, it seems clear enough that the underlying principles of cryptocurrencies are not going away any time soon. The blockchain technology that underpins cryptos is powerful and secure. Even if nations begin to issue their own digital currencies, there may be plenty of room for non-governmental cryptocurrencies to exist and prosper right alongside.

Get Answers to 6 of Your Most Important 401(k) Questions

401(k) plans are hailed by many financial experts as one of the easiest and most convenient ways to save for retirement. However, according to data from the US Census Bureau, although an estimated 79 percent of American workers have access to a 401(k) plan through their employer, only 41 percent of those choose to take advantage of this retirement savings option.

Given the many benefits they can offer, why is 401(k) uptake so low? One possible reason could be the fact that many people, even those who do participate in a 401(k), find the rules and details of this type of plan confusing. When you’re not sure what the advantages of a 401(k) really are, or when and how you’ll get back the money you put in, it’s understandable that you might feel hesitant about funding such a plan.

If you share this confusion, and have avoided pursuing a 401(k) opportunity for that reason, read on for answers to some of the most commonly asked questions about 401(k)s.

What exactly is a 401(k)?

Simply put, a 401(k) is an employer-sponsored retirement plan that is funded, at least in part, by contributions deducted directly from your earnings. Your employer invests this money on your behalf in a retirement fund, where it will grow on a tax-deferred basis until you withdraw from it.

Why would I choose to participate in my employer’s 401(k) plan?

There are a number of reasons why investing in a 401(k) through your employer makes good financial sense. The first is the opportunity for a tax break. The money that you contribute to a 401(k) comes directly off your salary before taxes, which in turn lowers your taxable income and results in a smaller tax bill.

Another important reason to participate is to take advantage of employer contributions. As part of their 401(k) plans, many employers will offer to match whatever money you put in up to a certain percentage. This essentially amounts to free money from your employer, and is one of the biggest benefits that a 401(k) can offer over other retirement savings options.  For example, it is fairly common for an employer to contribute or “match” 50% of what you put into the 401k up to a certain percentage of your salary-such as 3% from the employer if you contribute 6%.  This is essentially a 505 return on your money, even if you leave it in cash in a money market choice! We urge all people to contribute up to the maximum match offered by the employer for this reason. 

Finally, investing in your employer’s 401(k) plan can be worth it simply because it’s so convenient. Once you’ve enrolled in the plan and set your desired contribution level, that money will be set aside each month without you having to make any effort or even think about it at all.

How much money should I invest in my 401(k)?

The amount you choose to contribute to your 401(k) will depend on a number of factors, such as your anticipated expenses during retirement, your current assets and debts, and the tax advantages you can gain from different contribution levels. As a general rule of thumb, however, most experts recommend that you put a minimum of 5-10 percent of your paycheck toward your 401(k).

Finally, do be aware that 401(k)s have contribution limits attached. For 2021, employees can put up to $19,500 towards a 401(k).

How is the money in my 401(k) invested?

While your employer does make certain investment decisions on your behalf with a 401(k), it’s important to understand that you do have some choices when it comes to how your 401(k) contributions are invested. Most plans offer some combination of actively managed domestic and international stock funds, domestic bond funds, and money-market funds, as well as low-cost index funds.

Depending on your investment goals and risk tolerance, you can choose how you want your money allocated, and you can also make changes to your investments over time. If you don’t know where you want your contributions to go, the default option will typically be a money-market fund or a target-date fund. Unfortunately, most 401k plans do not offer a truly broad menu of investment choices. For example, there are often no choices in the following asset categories, which can mean lots of lost opportunities for growth and returns over time:  precious metals; natural resources; emerging markets; real estate; foreign bonds; etc. It is therefore important for you to try to gain a presence in these other asset categories with non-401k funds, if possible, in order to be truly diversified in your pursuit of long-term growth for retirement.

What do I have to do if I want to join my employer’s 401(k) plan?

Some companies offer automatic 401(k) enrollment, which means that you’re automatically included in your employer’s 401(k) as soon as you start working. Other companies take an “opt-in” approach. This means that you’ll need to fill out a form and submit it to HR to set up your 401(k) and start having contributions deducted from your pay.

In either case, you can talk to someone from HR or payroll if you have questions at any time about your 401(k), or if you want to change details such as your contribution amount.

What happens to my 401(k) if I move to a new job?

Because 401(k) plans are employer-sponsored, employees are often confused about what will happen to their 401(k) if they leave their current job. The good news is that you do have several choices in this situation.

You can simply leave the money in your employer’s plan, where it will continue to be invested; you can roll the money into a 401(k) at your new employer, if they offer one; or you can roll the money into an individual retirement account (IRA). You also have the option to simply cash out your 401(k) when you leave an employer, although this is not usually recommended as it increases your tax burden significantly and wipes out future financial gains.  If you “roll over” the funds in your 401k to an IRA when you leave that job, there are no tax consequences. In other words, the entire amount of the 401k being rolled over into the IRA account will not be taxed-those funds will continue to grow tax deferred in the IRA, and now, in that IRA, you will have many more investment choices available to you. 

A Helpful Cryptocurrency Glossary That’s Great for Beginners

I recently did a webinar with a colleague on the subject of learning about Bitcoin and cryptos.

An Introduction to Crypto-Currencies

Hosted by Robert Ryerson, Dr. Jose Cao Alvira, Nikki Shank

Thursday, March 25 2021

6:00 PM Eastern Time (US and Canada) GMT -4

We have recorded the webinar event for you!

In case you missed the live webinar, or in case you would like to watch it again, here is the link to the replay video:

Enjoy the content!

A Helpful Cryptocurrency Glossary That’s Great for Beginners

If you’re thinking about investing in cryptocurrencies, familiarizing yourself with the industry’s most common terms is a helpful first step to take. The world of digital currencies is full of highly specialized terms, acronyms, and phrases that can be confusing to a prospective investor encountering them for the first time. Taking the time to learn the basic vocabulary helps give you a better understanding of what cryptocurrencies are and, therefore, a more secure foothold as you enter this exciting and fast-moving market.

The following are some of most useful cryptocurrency terms with which to start:

Address – An address is a specific code, represented as a string of numbers and letters, that identifies the location of every cryptocurrency coin on the blockchain. When cryptocurrency transactions take place, digital assets are sent to and from different addresses.

All Time High (ATH) – As the expression suggests, all time high (ATH) is the term for the highest price a particular cryptocurrency has ever reached on the market. If you’re interested in tracking the performance of different cryptocurrencies, comparing the ATH against the current price can give you a sense of whether a digital asset is a good buy at any given moment.

Altcoin – Also known as alternative coins, or simply alts, altcoin refers to any type of cryptocurrency other than Bitcoin. According to some estimates, there are currently close to 9,000 different altcoins in existence, and altcoins accounted for more than 40 percent of the total cryptocurrency market in March 2021.

Bag – In the cryptocurrency world, the term “bag” is essentially the equivalent of “portfolio” in that it refers to the full collection of digital assets that you hold.

Bitcoin – Launched in 2009, Bitcoin is the original cryptocurrency and still the most popular digital currency in the world.

Blockchain – The driving force that powers virtually every type of cryptocurrency, blockchain is a trail of verified digital transactions that have been linked together. Functionally, blockchain acts as a kind of virtual accounting ledger in which publicly viewable transactions are stored in multiple secure places.

Cryptocurrency – Money that exists in the form of encrypted, digital information. The most important thing to understand about cryptocurrency is that it is completely independent of banks or other traditional financial institutions and uses sophisticated mathematics to process and regulate how funds are created and exchanged.

Cryptography – The process of encoding and decoding information to keep it private and secure.

Distributed – This refers to the practice of spreading something out in different places or among different devices rather than keeping it in a single location. One term you’ll hear frequently in a cryptocurrency context is “distributed ledger,” which refers to the fact that the blockchain is essentially a shared database where transactions and related details are recorded in multiple places at the same time. The idea behind distributed-ledger technology is that, because there are many identical copies of the ledger in existence, the information it stores is far more secure and virtually impossible to counterfeit.

Exchange – One of the more easily identifiable terms found in the cryptocurrency world, an exchange is a marketplace where traders can buy, sell, and trade digital assets. Many different exchanges exist, each with its own rules around trading fees, exchange rates, and other key features. Note that it’s not usually possible to trade any type of cryptocurrency on any exchange; some exchanges only trade in a selection of cryptocurrencies.

Fiat Currency – Fiat currencies are what most people think of as “real money.” In other words, a fiat currency is any type of government-issued currency that a specific nation or region uses as legal tender, such as the U.S. dollar or the euro.

Mining – The term mining refers to the process of creating new units of a digital currency by verifying digital transactions and adding them to the blockchain. Another way to describe mining is the act of running software that solves cryptographic puzzles in order to obtain rewards in the form of digital currency.

Node – Any computer that hosts the blockchain is known as a node. Having many nodes running the blockchain is an essential part of its distributed-ledger technology.

Satoshis (Sats) – A satoshi is the term for the smallest fraction of a Bitcoin: one-hundred-millionths. The name comes from Satoshi Nakamoto, the pseudonym by which the person or group that created Bitcoin is widely known.

Token – Tokens are digital units issued on a blockchain. They are the primary means of transferring and storing value on the blockchain network.

Wallet – In the world of cryptocurrency, a wallet is the software that interacts with the blockchain and allows you to send or receive digital assets. Wallets can be either hot, which means they are connected to the Internet, or cold, in which case they are not connected (cold wallets are usually considered to be the most secure way to store cryptocurrency assets).

6 Signs That Can Tell You if You’re Financially Ready to Retire

Do you find yourself thinking about retirement with just as much fear as excitement? If so, it’s not at all surprising; workplaces seem to be full of stories about people who stop working too soon and find themselves in dire financial straits during their retirement years. In fact, according to the 2020 Transamerica Retirement Survey of Workers (an annual study now in its 20th iteration), the possibility of outliving savings and investments is the most common retirement fear, with 40 percent of American workers citing this as their top concern.

Fortunately, there are plenty of signs that can help you determine whether you are financially ready to retire. As you think about the timeline for your retirement, note how many of the following points apply to you to give you a more accurate idea of just how prepared you are to stop working.

1. You’ve reached full retirement age.

Even if you’ve done very little retirement planning, you’re probably aware that the age at which you retire is directly connected to the amount of Social Security benefits you’ll be entitled to. Although you can begin receiving Social Security benefits as early as age 62, you aren’t eligible to receive your full Social Security benefit until you’ve reached what is known as full retirement age (this is age 66 for workers born between 1943 and 1954 and 67 for US workers born in 1960 and later). If you do choose to claim your benefits early, the monthly benefit you’ll receive will be up to 30 percent lower than the amount you’d be eligible for at full retirement age—a significant reduction that can have big implications for your retirement finances.

2. Your debts are paid off.

One of the most important things you can do to set yourself up for a financially secure retirement is to pay off most or all of your debt before you stop working. Things like mortgage payments, car payments, and credit card interest can eat into a fixed income fairly quickly, not to mention the fact that these debts reduce the buffer you have available to deal with any unexpected financial emergencies.

3. You’re not financially supporting a dependent.

If you’re providing financial support to your children, parents, or both (15 percent of middle-aged adults fall into this last category, according to Pew Research Center), it may not be financially feasible for you to stop working just yet. A financially secure retirement assumes that, to a certain extent at least, you’ll be able to downsize and reduce some of your costs. However, this is extremely difficult to do if you’re responsible for expenses like college tuition for one or more kids or health-related costs for elderly parents. Furthermore, retirement plans tend to focus on individuals or couples only, and they don’t typically take into account the need to provide financially for other parties.

4. Your current income is (more than) enough for your needs.

Unless you’re extremely well prepared for retirement, your income is likely to take a hit as soon as you stop working (as suggested by many retirement planners and financial advisors, a good rule of thumb is to expect your retirement income to be about 75 percent of your working income). The assumption here is that this reduced income will be offset by the corresponding loss of other costs, such as retirement plan contributions, saving for a child’s education, or commuting. However, if you find that your current income is only just adequate for your needs, you may not be able to make ends meet effectively when that income is reduced by 25 percent, even if some or all of those previously mentioned costs are eliminated.

5. You don’t foresee any major expenses in the near future.

Retirement planning is all about thinking ahead, so it only makes sense to hold off on retirement until you’ve addressed any major anticipated expenses. For example, does your home need a new roof? Are you thinking about purchasing a vacation home or a new car? It’s best to deal with these kinds of expenses before, rather than after, you stop working. Larger expenses can add up quickly, and if you’re withdrawing funds from taxable accounts to pay for them, it can have a significant impact on your portfolio that can, in turn, affect your retirement income.

You and your spouse are on the same page.

If you have a spouse or partner, your retirement will have just as big an impact on them as it will on you. It’s therefore essential to share your plans with your spouse and have an open conversation about what your retirement will mean for you both, particularly in financial terms. Points that are helpful to discuss together include how your spouse will be affected by a reduced income, whether your spouse will need to work longer to cover household expenses, and what your spouse’s own plans are for retirement.

Getting Started with Cryptocurrencies – 7 Big Questions Answered

There’s little doubt that cryptocurrency is one of the hottest topics in the financial sphere today, but this doesn’t necessarily mean that it’s easy to understand. Due to the sophisticated technology that powers it and the incredible speed with which it has evolved, cryptocurrency can be a confusing subject even for people with a good deal of financial knowledge, let alone for the average investor wondering about the best way to save for retirement.

To help demystify some of the current discussion around cryptocurrencies, New Century Planning Associates Inc. has just released a special presentation that aims to introduce the world of cryptocurrency to a general audience. Featuring New Century President Robert M. Ryerson and CUNY Professor Jose J. Cao Alvira, the presentation offers straightforward answers to some of the most common questions beginners have about cryptocurrency, including:

1. What are cryptocurrencies?

Also known as “cryptos” or “digital assets,” cryptocurrencies are digital currencies which take the form of virtual tokens or “coins.” As suggested by the name, the most important feature of a cryptocurrency is the advanced cryptographic protocol which secures the creation and processing of the currency and its associated transactions. It makes counterfeiting or replicating the currency nearly impossible.

2. How does Bitcoin work?

Although there are thousands of cryptocurrencies in existence today, Bitcoin still leads the field when it comes to market capitalization, user base, and popularity. Widely considered to be the original cryptocurrency, Bitcoin was launched in 2008 after the collapse of Lehman Brothers led to a global financial crisis and a widespread lack of trust in the international banking system.

The basic principle behind Bitcoin is the use of an online protocol to transfer value from one person to another via blockchain technology. Transfers may take place in exchange for goods and services—for example, you might buy something from another person and choose to pay them in Bitcoin—or simply for the purpose of transferring the value, much like a stock market trade.

3. How does mining work?

Mining is another (somewhat confusing) term you’ll often hear in discussions about Bitcoin. An instrumental feature of Bitcoin adoption, mining is, in essence, the practice of validating digital transactions that involve Bitcoin. This work is carried out by miners, or computer programmers, who are spread all over the world.

These miners monitor and confirm each transaction that is entered into the Bitcoin system, thus ensuring the validity and legitimacy of the system. For their efforts, miners are paid in Bitcoin. This provides an incentive to keep the whole system running efficiently and permanently, and it removes the need for a central authority to oversee the system.

4. How does blockchain work?

Blockchain technology is the driving force behind Bitcoin and virtually every other type of cryptocurrency. A blockchain is a trail of verified digital transactions, or “blocks,” that have been strung together. This happens when a transaction is verified by a miner, as described above: the verified transaction is then attached to other, previously verified blocks, producing a chain that gives blockchain its name.

You can think of blockchain as a kind of virtual accounting ledger in which every transaction is publicly viewable, and that is distributed, or stored, across a vast network of highly-secured computer servers. The transactions are stored in chronological order, and they are irreversible, which means that it’s impossible to eliminate evidence of historical transactions.

5. How are cryptocurrencies purchased?

If you’re interested in purchasing cryptocurrencies, the most common place to start is a cryptocurrency trading exchange. Coinbase, Kraken, Gemini, and Binance are some of the platforms where the more popular cryptocurrencies, including Bitcoin, can be purchased. To hold your new digital assets, you’ll need a special app known as a “wallet.”

Wallets can be either “hot” (that is, connected to the internet) or “cold” (this is an external storage device with no internet connectivity). Because they are not connected to the internet, cold wallets offer increased security, but are less convenient to access; hot wallets, on the other hand, may be more vulnerable to security breaches but offer easy access to your assets.

6. What other cryptocurrencies are worth investigating?

While Bitcoin remains the cryptocurrency of choice for most investors, many other cryptocurrencies are worth exploring. One digital asset that has risen significantly in popularity (and value) over the last year is the cryptocurrency known as Theta. First introduced in 2018, Theta is the token of the Theta blockchain, a purpose-built network for decentralized streaming video delivery. It is available on many popular exchanges, including Binance and Kraken.

7. Are cryptocurrencies right for you?

Despite their soaring popularity, cryptocurrencies aren’t always the right choice for every investor. To learn more about what role cryptocurrencies could play in your investment strategy, check out the New Century Planning Associates presentation, which includes a special offer for a free 15-minute consultation with New Century Planning advisors.

5 Reasons Why Retirement Planning Matters More Than Ever

If you’re finding it difficult to make retirement planning a priority, you’re not alone. Meeting your current financial obligations—such as rent or mortgage payments, recurring monthly expenses, and debt or interest repayments—can be challenging enough without having to think about the long-term future as well. Given how great this pressure from immediate financial demands can be, it’s perhaps not surprising that 42 percent of Americans say they have no retirement savings at all, as revealed in a 2018 report from the Center for Financial Services Innovation.

However, while this figure may not be surprising, it is certainly concerning. For people in the workforce today, retirement planning is more important than ever, and the longer you delay taking action about it, the more potentially serious the future financial consequences can be. Although you may think that you can’t afford to save for retirement, the simple truth is that you can’t afford not to. Here are five reasons why.

1. You may live longer than you think you will.

Did you know that the life expectancy for the average American is now close to 80? As a result of healthier lifestyles, medical advances, and many other factors, people all around the world are living longer than ever before. From a retirement planning perspective, this means that it’s important not to underestimate the number of post-retirement years you might have ahead of you. Even if you’re thinking about working past the traditional retirement age of 65, there could still be many years (or even decades!) where you’ll need a nonwork-based source of income.

2. You may not get to decide when you retire.

Of course, even if you’re planning to keep working after you turn 65, the fact is that the timing of your retirement may not be something you have control over. According to data from the Retirement Confidence Survey (RCS), an annual survey of working-age and retired Americans led by the Employee Benefit Research Institute, there is a significant gap between the age at which most workers think they will retire and the age at which they actually leave the workforce.

Specifically, it’s quite common for workers to retire earlier than planned. As reported in the 2020 RCS, 31 percent of workers said they planned to retire at or after age 70, but only 6 percent of retirees had retired in that age range. Similarly, only 11 percent of workers said they planned to retire before the age of 60, but 33 percent of retirees reported that they had retired that early. For many respondents, their early retirement was due to issues such as health problems or disabilities (35 percent) or to changes at their company (35 percent). As an individual worker, neither of these scenarios is usually within your control.

3. You may have underestimated future medical costs.

When thinking about your retired life, the age at which it starts isn’t the only thing that might be out of your hands. While many working people assume that they’ll be able to remain healthy and fit throughout their golden years, the reality doesn’t always work out that way, and, unfortunately, unexpected medical bills can have a serious financial impact on someone without a solid retirement plan. Furthermore, even seniors who do enjoy good health during their retirement usually face far higher healthcare costs than they imagine. As reported in a 2018 article from The Motley Fool, the average 65-year-old man and woman will need to spend $189,687 and $214,565, respectively, to cover medical care in retirement, not including long-term care costs.

4. Your expenses may not decrease in retirement.

Healthcare expenses aside, many retirees are also surprised to find that their other expenses don’t decrease as much as they expected—if at all—after they retire. Many basic expenses, such as food, personal care, utilities, and car payments, simply remain the same. Other expenses may decrease, but they can be offset by additional costs. For example, if you own your home, you may have your mortgage paid off by the time you retire, but your (older) home may now require costly repairs and renovations.

Finally, the expense category that may increase the most, depending on your vision for your retirement, is leisure. If you’re planning to travel or enjoy more entertainment opportunities than you did while you were working, you may find you need a higher income to support this lifestyle.

5. Social Security alone isn’t sufficient.

Many workers assume that they don’t need to put aside independent savings for retirement because Social Security will provide them with the income they need. However, while Social Security is indeed an important source of retirement income, it shouldn’t be—and was never intended to be—the only source. For most people, Social Security will fall far short of the income needed to meet basic expenses in retirement, let alone pursue travel or other leisure opportunities. As an example, if you’re a 30-year-old currently earning an annual salary of $50,000, at the age of 67, you would receive less than $22,000 per year (in today’s dollars) in Social Security payments.

How Can A Financial Professional Help You?

Today, the field of financial planning is growing in popularity, with more people than ever working to create some type of financial plan for their future. For those who possess little understanding of the financial industry, financial planning can be overwhelming and difficult. In these cases, it might be prudent to seek the services of a financial professional, such as a financial planner or a financial advisor, to help you. What do financial professionals do and how can they help you with your finances?

Financial Planners and Financial Advisors

When looking for a financial professional to assist you in planning your finances, you will encounter two common types: financial planners and financial advisors. For those who are unfamiliar with the financial industry, they might sound interchangeable, but are, in fact, quite similar. However, there are a few key differences that you should be aware of when choosing which type of financial professional you should work with regarding your finances.

The term “financial advisor” is the broader of the two. Financial planners can be financial advisors, but not all financial advisors are financial planners. Financial advisors can obtain more than 100 different types of certifications. These professionals can help you to manage your money and investments in a broader sense, serving as close partners throughout the financial planning process. Together, you may highlight a wide array of financial topics.

The term “financial planner” is specific to financial professionals who help companies or individuals when creating a financial plan designed to meet their long-term monetary goals. These professionals may focus on certain areas of finance in order to better assist clients with their specific needs.

No matter which type of financial professional you choose to work with, they will typically ask you to complete a financial health questionnaire of some kind. This will give them a more complete look at your finances, thus enabling them to offer you relevant and helpful advice.

Benefits of Working with a Financial Professional

A financial professional can help anyone, regardless of their income level—especially when it comes to helping them to achieve their long-term financial goals. Financial advisors leverage their industry knowledge to give their clients relevant advice regarding investment opportunities, tax strategies, insurance, bulking up savings, and creating a functional budget. It is that knowledge that can prove most beneficial to you, particularly if you lack knowledge in a particular area of your finances.

Both financial advisors and financial planners are helpful when you’re seeking to attain specific financial goals. They could include aspects such as saving for a down payment on your first home or your child’s college education, or paying down student loan debt. Financial advisors can help you with these long-term goals, as well, but they can also advise you on shorter-term goals like tackling credit card debt or establishing an emergency fund.

Financial Goals

Most financial professionals recommend that people create a budget to manage their finances, but this isn’t always easy. Establishing a budget that you can successfully follow requires financial planning. With the help of a financial professional, you can develop a budget that will accommodate your specific lifestyle, whether you are able to set aside a large amount of money each month, or you live paycheck to paycheck and saving is a distant dream. You can adjust your budget to meet any monetary goal, and a financial advisor can help you to determine where you should be putting your money as you seek to achieve that goal.

If you decide to work with a financial planner or a financial advisor for the long-term, then they will most likely set up regular sessions with you to check in on the state of your finances. This is important because your finances and personal situation will change over time. To get the most out of your financial plan, you need to regularly take stock of your financial situation.

You may think that the services of a financial professional do not fit into your budget, but you don’t necessarily need to pay for financial advice in the long term. Depending on the type of advice you need, it may be possible to hire a financial professional for only a few sessions. For instance, you can enlist their services to develop a financial plan or to consult with them before starting a family or retiring.

Working with a financial planner or a financial advisor can guide you through a variety of financial situations. Whether you are planning for retirement, seeking investment advice, or paying off debt, these professionals can advise you in making the most effective financial decisions for you and your family.

Are Multiple Financial Advisors a Smart Idea? What You Need to Know

Working with a financial advisor to help you achieve your financial goals has become increasingly common. Where once people considered financial advisors and financial planning in general only appropriate for the very wealthy, now people from a broader range of income levels are interested in creating a comprehensive financial plan for themselves and using a professional to help them do so.

If you have one financial advisor, you might wonder whether that one is enough. Maybe you have considered multiple financial advisors to address multiple distinct financial needs. Maybe you’re wary about putting all your assets in one advisor’s hands and are wondering if multiple advisors might mitigate that risk. Whatever your motivation, if you’re considering hiring more than one financial advisor, here are a few pros and cons to think about.

The Cost Factor

First and perhaps most importantly, you should think about the overall cost implications of employing more than one financial advisor. Financial advisors are instrumental in helping you achieve your overall long-term financial goals, helping you invest your money, reduce your tax burden, and save for your retirement. However, if you’re employing multiple financial advisors, it could be possible that the amount you are spending for their services outweighs the benefits they are providing. For example, you could end up paying more in fees and commissions if you split your money among several advisors, rather than investing one large amount with one advisor or firm. Calculate the combined cost of your financial advisors before deciding on that particular course of action, because the expenses could outweigh the benefits for your situation.

The Time Factor

Something else you might consider is the amount of time you’re likely to spend dealing with your different financial advisors. Multiple advisors can be a benefit, but you won’t see those benefits unless there is someone in a leadership role who has oversight of everything. In many cases, that role falls to you, meaning you have to spend a considerable amount of time managing all the advisors you are employing. Two advisors means twice the meetings, twice the phone calls, and so on. You’ll have to serve as a go-between as well.   

Alternatively, you could decide instead to designate one primary advisor and direct the rest of your financial advisors to report to that person before they make decisions. This can be a workable alternative to free up your time, since you can communicate your needs and goals with one primary individual, rather than having to spend a lot of time talking with each advisor individually. The key to effective use of multiple advisors is, of course, communication.

Consider a Specialist

If you already have a financial advisor helping you manage your goals, a second advisor could fill in the gaps in the other’s skills and expertise. For example, your primary financial advisor may manage your retirement savings, but may not have expertise in estate planning. In this case, engaging with a second financial advisor who specializes in estate planning could be an excellent idea. No matter your financial situation, multiple financial advisors are always most effective when they work in coordination and fill in each other’s knowledge gaps. When your financial advisors’ work overlaps, or when they aren’t coordinating, problems can arise.

The Cons and Caveats

In many situations, multiple financial advisors can be effective, in particular for high net worth individuals. With considerable means at your disposal, multiple financial advisors can mean multiple investment strategies that provide good portfolio diversification.

However, for this strategy to be effective, you must ensure that your assets really are being diversified, and that your team is working in concert. In some cases, the overlap created with multiple financial advisors has the potential to put you at risk. If more than one advisor chooses to purchase the same assets, the result could be that you end up with too much exposure in one asset class.

That’s why all your advisors must be working under the same strategy, and each must know what the others are doing. Remember that none of them will be able to provide good advice if they do not have a comprehensive understanding of your finances. They need to be able to see the entire picture—your total income, liquidity, wealth, debt, and risk exposure—and not just the assets they’re managing. Advisors have a fiduciary duty to do what’s best for their clients, and they usually need to understand your whole picture to fulfill that.

For those individuals looking for a more diverse approach and reduced risk, but who are not comfortable with multiple financial advisors, the alternative is to look for an advisor or firm with experience in multiple financial specialties. In many cases, an advisory firm that utilizes this kind of team approach is a great solution. This way, you can get the benefits of multiple advisors with different specialty areas.

Consider Your Goals

Before deciding to use multiple financial advisors, consider the solution that will work best for your specific financial goals. You may be looking for an advisor specifically for your retirement or estate planning needs, or you might be looking for someone who can handle all your finances. Depending on your goals, multiple financial advisors could be beneficial. However, always be sure to weigh your options—including the financial and time expenses of having multiple advisors—before deciding to add more to your team.