Financial Planning

RETIREMENT PLANNING. If retirement turns out to be one of our client's personal goals, the Enough for Life Report will analyze when and under what other circumstances that goal can be achieved. Should more money be saved? Through which tax-favored vehicles? Can the present standard of living be maintained? How aggressively or conservatively should the client's financial assets be invested to have the highest probability of retiring at the desired time (using Monte Carlo analysis)?

Many of our clients are business owners who are unaware of the many types of retirement plans that can be utilized to reach retirement goals. Recent changes in tax law are allowing some of our clients to contribute hundreds of thousands of dollars to retirement plans on a pre-tax basis. Each plan has different requirements as to how much can be set aside each year, whether an annual contribution is required, and who in the company must be covered. For those who don't own their own business, we analyze and explain the various choices available through their employer - 401k, pension, deferred compensation, employee stock purchase plans, and other benefits. Regardless of employer, we help our clients choose their best options for retirement savings.

Those nearing retirement or in retirement face a period of tremendous uncertainty. After a lifetime of earning income and accumulating assets, clients are faced with having a finite asset base to meet their future living expenses. The assets that have been accumulated must last for the remainder of their lives, which is a daunting proposition in an age of longer life expectancies. Some investment risk must typically be assumed because inflation will erode the purchasing power of a portfolio over time. We build customized portfolios to balance these risks, while educating our clients to the types and levels of risk that they are assuming.

ENTREPRENEURS AND BUSINESS OWNERS. Four MBA's, one JD, and an abundance of personal self-employment experience allow Abacus advisors to provide uncommon wisdom and guidance to our self-employed clients. This advice covers corporate tax planning, business succession issues, key-man insurance, business sales, mergers, and acquisitions, employee benefits packages and 401k plans, and managing corporate retirement plans, cash and securities accounts.

REAL ESTATE. We believe that real estate is an important part of our clients' investment portfolios for both its diversification benefits and its tax benefits. As with all investments, however, we believe that our clients' real estate portfolios should be diversified to the greatest extent possible.

Our clients typically hold real estate either in the form of Real Estate Investment Trusts, mutual funds of REIT's, partnerships, or direct ownership. We consult with our clients on all aspects of real estate, including the form of ownership that is appropriate (direct or commingled), appropriate use of mortgage financing, sale/exchange strategies, appropriate use of leverage, tax-deferred exchanges (1031), and allocation amongst property types and geographic locations. As investment analysts, we are also skilled at analyzing real estate assets to determine if they are performing adequately for the level of risk being taken, and if not, to recommend suitable replacement properties.

We also advise clients on the appropriate use of personal mortgage debt, including assisting them analyze refinance options. We focus on the tax implications of keeping vs. selling a personal residence or second home. We also provide guidance on home remodeling and construction projects, and the best financing alternatives for them.

TAX PLANNING. We review our clients' personal and business tax returns to spot opportunities for lowering their tax bills. Most financial decisions are impacted by taxes, so we take them into account in our advice about investments, retirement plans and IRA's, stock options, Roth IRA conversions, college savings, gifts, employing family in business, insurance, and estate planning.

We do not prepare tax returns. We work very closely with our clients' CPA's to recommend strategies that will protect and grow wealth rather than lose it to the IRS and State.

INSURANCE. As part of comprehensive financial planning, we advise our clients on the proper amount and type of insurance for their needs. This advice can cover life, disability, property, automobile, earthquake, hurricane, long-term-care, and umbrella liability insurance. In addition, we can direct our clients to no-load and low-load insurance products that may not be available through the typical insurance agent. And because we don't sell any insurance ourselves, our advice is unbiased.

Our clients often own life insurance products, including whole life, term life, variable life, universal life, and/or annuities. Each policy has a unique cost structure, and many of the policies' fees are not obvious. Unfortunately, the combination of very loose disclosure laws and a competitive sales environment have led to the recommendation and purchase of many insurance products that are not in the client's best interests. While there are good reasons for owning life insurance, we often find that our clients can accomplish many of their goals in a more cost effective way than with the insurance they own.

ESTATE PLANNING. We provide two important services; estate planning and trust investment management. First, in conjunction with our client's estate planning attorney, we help analyze and suggest the most appropriate estate planning tools that might be used. We also make sure that our client's personal goals about their heirs, home, business, and philanthropy are at the core of any estate plan drafted. Too often, estate plans are designed only to minimize taxes and not to create vehicles for the continuation of the client's values and legacy to future generations. Second, we are able to manage the trusts and charitable funds that are created in estate plans. We have relationships with several corporate trustees that do not manage investments. In conjunction with our portfolio management expertise, this arrangement allows our clients more flexibility than is typical of most corporate trustee relationships.

PHILANTHROPIC PLANNING. If philanthropic planning is in order from a personal goals or tax perspective, Abacus has significant expertise. We are able to advise on tax-appropriate vehicles to use to accomplish a client's philanthropic objectives, as well as which assets make the most sense to use for funding such a vehicle. In addition, we have relationships within the community that can help clients identify the charities with whom they wish to partner in the pursuit of achieving their philanthropic goals.