Category: Saving

Life rarely stays the same for long. Over time, careers evolve, families grow or change, and priorities shift in ways that may not always be immediately reflected in a financial plan. While financial planning is often thought of as a long-term process, certain life events can naturally prompt a closer look at how everything is structured. Periods of transition can offer a valuable opportunity to step back, review your current financial picture, and consider whether your plan still aligns with your goals and circumstances today. Financial Planning Is Not Static A financial plan is often built around a snapshot in time. It reflects your income, responsibilities, goals, and resources at that moment. As life moves forward, those elements may change gradually or all at once. Because of this, financial planning is not a one-time event. It is an ongoing process that may benefit from periodic review, especially during times of change. Even small shifts can influence how different pieces of a financial plan work together. Recognizing when to revisit your plan can help ensure that it continues to reflect your current situation. Career Changes and Income Shifts Changes in employment are one of the more common reasons individuals revisit their financial plans. A new job, promotion, career change, or transition to self-employment can affect income, benefits, and overall financial structure. These changes may also influence retirement plan options, healthcare coverage, and savings patterns. During these transitions, individuals often take time to review: Changes in income and how they affect cash flow Differences in employer-sponsored benefits Retirement plan availability and contribution activity Adjustments in short-term and long-term financial priorities These moments can provide a clearer understanding of how income and benefits connect to broader financial goals. Approaching Retirement As retirement becomes more immediate, many individuals begin to take a closer look at their financial plans. This stage often involves shifting from accumulating savings to considering how those savings may support future income needs. It may also include reviewing timelines, expected expenses, and lifestyle preferences. Common areas of reflection during this phase include: Anticipated retirement timing Current savings and account structures Income sources during retirement years Healthcare considerations Rather than focusing on specific actions, this type of review helps individuals understand how their current plan aligns with their expectations for retirement. Business Ownership and Changes For business owners, financial planning can be closely tied to the structure and performance of the business itself. Changes such as starting a business, expanding operations, bringing on partners, or preparing for a transition can influence both personal and business-related finances. These developments may also affect income variability, tax considerations, and long-term planning. During these times, individuals may choose to review: The relationship between personal and business finances Cash flow patterns and financial stability Long-term plans related to business ownership Potential transitions, such as succession or sale These reviews can help ensure that financial planning reflects both personal goals and business realities. Divorce Or Separation Significant personal changes, such as divorce or separation, often lead to a reevaluation of financial priorities. These transitions can affect income, expenses, asset ownership, and long-term planning considerations. They may also prompt individuals to revisit documentation and account structures. During this period, individuals sometimes take time to review: Changes in income and household expenses Ownership and division of assets Beneficiary designations and account information Short-term and long-term financial priorities This process can help individuals better understand their financial position as they move forward. Family Changes and Responsibilities Family dynamics can shift over time in ways that influence financial planning. Events such as marriage, the arrival of children, supporting aging parents, or changes in household structure can all play a role in shaping financial priorities. These changes may affect budgeting, savings goals, and long-term planning considerations. Some individuals choose to reflect on: Adjustments in household expenses Savings goals related to education or family needs Changes in insurance coverage Estate planning considerations These types of reviews help ensure that financial plans continue to reflect the needs of those who depend on them. Relocation or Lifestyle Changes Moving to a new location or making a significant lifestyle change can also prompt a review of financial plans. Changes in cost of living, housing expenses, and local tax considerations may all influence how a financial plan is structured. Even smaller lifestyle adjustments can have an impact over time. During these transitions, individuals may consider: Differences in housing and living expenses Changes in income or commuting costs Adjustments in savings or spending patterns Long-term goals related to lifestyle preferences Understanding how these factors fit together can provide clarity as individuals adapt to new circumstances. Why These Moments Matter Life transitions often bring both challenges and opportunities. While some changes are planned, others may happen unexpectedly. In either case, these moments can create space for reflection. Reviewing a financial plan during a period of change does not necessarily mean making immediate adjustments. Instead, it allows individuals to evaluate whether their current approach continues to align with their evolving goals. By taking time to review financial information, priorities, and documentation, individuals can gain a clearer understanding of where they stand and how their plan supports their direction moving forward. Keeping Financial Planning Aligned With Life Financial planning works best when it reflects real life, not just a fixed set of assumptions. As circumstances change, revisiting your financial plan can help ensure that it continues to align with your current needs and long-term objectives. Even if no changes are made, the process of reviewing can provide valuable perspective. At Advisors Management Group, financial planning is viewed as an ongoing conversation. Life events often serve as natural points to revisit that conversation, helping ensure that each plan remains aligned with the individual circumstances and priorities of the people it is designed to support. If you are experiencing a life transition or simply want to revisit your financial plan, connecting with a financial professional can help provide a structured approach to reviewing your current situation and understanding how it fits into your broader financial picture. Contact Advisors Management Group If you would like to discuss your financial goals or have questions about your current strategy, please contact us. Advisors Management Group, Inc. is a registered investment adviser whose principal office is located in Wisconsin. Opinions expressed are those of AMG and are subject to change, not guaranteed, and should not be considered recommendations to buy or sell any security. Past performance is no guarantee of future returns, and investing involves multiple risks, including, but not limited to, the risk of permanent losses. Please do not send orders via e-mail as they are not binding and cannot be acted upon. Please be advised it remains the responsibility of our clients to inform AMG of any changes in their investment objectives and/or financial situation. This commentary is limited to the dissemination of general information pertaining to AMG’s investment advisory/management services. Any subsequent, direct communication by AMG with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides. A copy of our current written disclosure statement discussing our advisory services and fees continues to remain available for your review upon request.

Retirement planning is often discussed in broad terms, but many assumptions about it are shaped by incomplete information or generalizations. These misconceptions can influence how individuals think about saving, timing, and long-term financial needs. Taking time to understand some of the more common misunderstandings can help bring clarity to the planning process. Rather than focusing on specific actions, it can be helpful to look at how different factors interact over time and how expectations compare to reality. When Do Most People Start Saving? One common assumption is that retirement planning begins at a certain age, often later in one’s career. In reality, individuals approach retirement planning at many different stages of life, depending on their circumstances, priorities, and financial situation. Some may begin saving early, while others may focus more on retirement planning as their careers progress. Factors such as student loans, housing costs, or career changes can influence when and how individuals begin to prioritize long-term savings. There is no single timeline that applies to everyone. Instead, retirement planning tends to reflect a combination of personal goals, financial resources, and life experiences. Understanding this can help shift the focus away from comparison and toward individual progress over time. How Long Retirement May Last Another area where misconceptions often arise is the length of retirement. It is sometimes assumed that retirement will last for a relatively short period. However, increasing life expectancy has changed that perspective. Many individuals may spend several decades in retirement, depending on when they retire and their overall health. This extended timeframe introduces additional considerations. Planning for a longer retirement may involve thinking about how financial resources are used over time and how different sources of income interact throughout those years. Because longevity varies from person to person, estimating the length of retirement is not an exact calculation. Instead, it is one of several factors that can influence how individuals think about their financial plans. Understanding Income Sources in Retirement Another misconception is that retirement income comes from a single source. In practice, retirement income is often made up of several components. These may include Social Security, employer-sponsored retirement plans, personal savings, or other financial resources. Each source may play a different role depending on the individual’s situation. Relying on one source alone is not always how retirement income is structured. Instead, these elements often work together to support financial needs over time. Understanding how different income sources interact can provide a more complete view of retirement planning. This perspective also highlights that retirement planning is not just about accumulation. It also involves understanding how resources may be used and coordinated throughout retirement. The Role of Inflation Over Time Inflation is another factor that is sometimes underestimated in retirement planning. While inflation may seem gradual in the short term, its long-term impact can influence purchasing power over time. This can affect everyday expenses such as housing, healthcare, and general living costs. Surveys have shown that many individuals view inflation as a significant concern in retirement, as rising costs can influence how far savings may go over time. Because retirement can span many years, even modest changes in inflation may have a cumulative effect. Recognizing this can help provide context when reviewing long-term financial plans. Assumptions About Spending in Retirement Another commonly held belief is that spending decreases significantly in retirement. While some expenses may change, overall spending patterns can vary widely. For example, work-related costs may decline, while other areas such as healthcare, travel, or leisure activities may increase. Research indicates that many retirees report higher-than-expected expenses, suggesting that spending in retirement does not always follow a predictable pattern. Because of this, retirement planning often involves looking at a range of potential expenses rather than assuming a single pattern. This approach can provide a more balanced view of long-term financial needs. Misunderstandings Around Withdrawal Strategies Rules of thumb are often discussed in retirement planning, particularly when it comes to withdrawing savings over time. While these frameworks can provide a general starting point, they are sometimes interpreted as universal solutions. For example, commonly referenced withdrawal approaches are often based on specific assumptions about time horizons, market conditions, and individual circumstances. These assumptions may not apply equally to every situation. Because retirement planning is highly personal, these types of guidelines are often best viewed as general concepts rather than fixed outcomes. Understanding the context behind them can help individuals interpret them more effectively. Balancing Expectations With Reality Misconceptions in retirement planning often stem from simplified ideas about complex topics. Retirement involves a range of variables, including timing, longevity, income sources, and economic conditions. At the same time, individuals may find that their expectations evolve over time. As circumstances change, so can perspectives on retirement goals and financial priorities. Taking a step back to review these assumptions can help create a clearer understanding of how different elements fit together. Keeping the Focus on Long-Term Perspective Retirement planning is a long-term process that develops over many years. Rather than focusing on a single moment or decision, it often involves ongoing reflection and adjustments based on changing circumstances. Understanding common misconceptions can be a useful starting point for these conversations. It can help individuals ask more informed questions and consider how their plans align with their current situation. At Advisors Management Group, financial planning is approached as an ongoing process that evolves over time. As individuals review their financial picture, these discussions can help maintain alignment between long-term goals and the realities that shape them. While retirement planning can feel complex, taking the time to better understand common assumptions can provide valuable perspective. Over time, that perspective can support more informed conversations about financial priorities and long-term planning. Contact Advisors Management Group If you would like to discuss your financial goals or have questions about your current strategy, please contact us. Advisors Management Group, Inc. is a registered investment adviser whose principal office is located in Wisconsin. Opinions expressed are those of AMG and are subject to change, not guaranteed, and should not be considered recommendations to buy or sell any security. Past performance is no guarantee of future returns, and investing involves multiple risks, including, but not limited to, the risk of permanent losses. Please do not send orders via e-mail as they are not binding and cannot be acted upon. Please be advised it remains the responsibility of our clients to inform AMG of any changes in their investment objectives and/or financial situation. This commentary is limited to the dissemination of general information pertaining to AMG’s investment advisory/management services. Any subsequent, direct communication by AMG with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides. A copy of our current written disclosure statement discussing our advisory services and fees continues to remain available for your review upon request.

This is a common question related to retirement and retirement planning, and the answer might surprise you. While most people assume there is a magic account balance, for example one million dollars, that is not the case. The truth is that people retire comfortably with all different account balances because every situation is unique. Let’s look at factors that contribute to your retirement needs.  Spending Need Everyone’s spending needs are different. If you plan to retire with no debt and minimal monthly expenses, you may need less than someone who has a larger spending need. For those with minimal spending, Social Security may cover a good amount of their spending need allowing for minimal dependence on retirement savings. On the other hand, if your monthly spending needs are large or you anticipate travel or big-ticket discretionary spending, you will need to have more money available. Ask yourself what you would like your retirement to be like, what expenses you will likely bring into your retirement and what you envision your lifestyle to be like.  Replacing Income If the idea of living without your 9 to 5 paycheck causes you to feel stressed, you are not alone. When you start retirement, you will need to replace your paycheck with other sources. For most people, Social Security will be the base portion of your retirement income. According to the Social Security Administration, on average, Social Security payments will replace about 40% of your income. If you have lower income, this number will be higher, but if you have higher income, this amount will be closer to 25-35%  Anything that Social Security does not cover can be supplemented by your savings. IRAs, 401ks, Roth IRAs and non-qualified assets can be used to create a stream of income that becomes your paycheck in retirement. A professional financial planner can help to navigate how to spend your money to avoid spending it too quickly or paying too much in tax.  Pensions While only an estimated 15% of employees work for a company or entity that offers a pension, certain professions such as those in skilled trades, education or government likely offer a pension. If you are one of these workers, you will likely retire with less money in investments than your neighbor who works in the private sector. If you have worked in this industry for most of your career, you may have significant income that is not dependent on your personal savings. You may need far less money in savings to retire comfortably if you have a pension. The Case for Financial Planning The ins and outs of retirement planning can feel overwhelming. Financial planning can give you a look into the future and help you shed some light on your retirement future. There are a lot of factors that come into play when it comes to determining how much money you will need to save for retirement, and it is not a universal answer. It is easier to adjust your strategy earlier, then make compromises to your lifestyle later.  You do not need a lot of money to benefit from a financial plan; however, it can be the difference between having a comfortable retirement or not. Not sure where to turn? We can help. Contact us today to start planning for your retirement future.    Advisors Management Group, Inc. is a registered investment adviser whose principal office is located in Wisconsin.   Opinions expressed are those of AMG and are subject to change, not guaranteed, and should not be considered recommendations to buy or sell any security.  Past performance is no guarantee of future returns, and investing involves multiple risks, including, but not limited to, the risk of permanent losses.  Please do not send orders via e-mail as they are not binding and cannot be acted upon.  Please be advised it remains the responsibility of our clients to inform AMG of any changes in their investment objectives and/or financial situation.  This commentary is limited to the dissemination of general information pertaining to AMG’s investment advisory/management services.  Any subsequent, direct communication by AMG with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides.  A copy of our current written disclosure statement discussing our advisory services and fees continues to remain available for your review upon request.

How to save more money…What does this mean to you? Does it mean that you actively are looking to increase your savings? Does it make you think of starting a 401k, saving an emergency fund or tucking money away for a major purchase? Or does it mean saving money on groceries, making your paycheck go farther or not feeling stuck in the rut of trying make ends meet. While this same question can have two different meanings, the root of the question comes down to cash flow management. If you are getting established, you might feel like you are trying to make it from paycheck to paycheck. If you are in the middle, you may be looking for ways to increase your savings. If you are in the thick of retirement planning, you may find yourself focused on which expenses you bring into retirement and how to turn your nest egg into a cash flow to cover your monthly expenses. No matter your stage in the game, cash flow is part of equation. Cash flow management is the backbone of all financial planning strategies. Unfortunately, many people overlook the importance of evaluating where your money is going. It can be assumed that if you aren’t having issues managing your money, you don’t need to evaluate your spending. Evaluating cash flow can help you determine retirement spending needs, help you determine what expenses you will carry into retirement, and plan for inflation. Let’s break down some tips for maximizing ways to save more money. Foundational Years If you are just getting yourself established, pay yourself first, then set your lifestyle budget around what is left over. Setting up savings strategies like 401ks, Health Savings and emergency fund as soon as possible will help save more over the course of your working years and can get you on the road to wealth building sooner. It is harder to start these strategies later especially as responsibility grows. Avoid the urge to keep up with Joneses. Social media and other influences have painted an image that you need the latest and greatest of everything. Instead choose to live within your means, keep debt in check, keep emergency funds available and plan for major purchases. Don’t overextend yourself on housing or vehicle payments. Only make major purchases that you can comfortably afford and leave yourself some wiggle room so that you are able to handle unexpected emergencies. While the grass may look greener on the other side of the fence, the grass is truly greenest where you water it. If you are coming late to the game paying yourself first, start small and work your way up. It’s easier to save $1000 to your emergency fund than it is to save 6-12 months of income. If you feel you can’t save for retirement, start small and work your way up. Try to contribute enough to get any match your employer offers. If that seems like too big of a commitment, start by saving a percent or two and then increase every year. If you get a pay increase, increase savings again. By taking small steps towards your goals, you are creating good habits and moving in a positive direction. Wealth Building Phase Focus on increasing savings. The 50/30/20 rule is a very effective strategy to balance your short-term spending needs with your long-term savings goals. 50% of your income can go towards your necessities, 30% of your income can go to discretionary spending and 20% allocated to saving. The 20% that you save should be broken down between long-term goals and short-term goals. For example, if your employer matches up to 6% of your income, you may put 6% into your 401k, but then may fund a Roth IRA up to the maximum, while also putting money into a Health Savings Account and/or taxable brokerage account. The mix of savings can be customized to meet your goals and create tax efficiency. It’s a good rule of thumb that of the portion designated for saving, at least 10-15% will be allocated to retirement. Retirement savings should be left untouched to maximize growth and avoid unnecessary tax and penalty. Retirement Years While some people still save for their goals in retirement, most people’s focus is more on being mindful of how they spend their money. Projecting cash flow and expenses before you retire will help you to determine if your nest-egg will provide the income you will need to cover your expenses. For some people, annual spending needs will decrease because you can eliminate the portion you allocate to retirement income. Additionally, many people will have eliminated debt prior to retirement, which can lower retirement income need. As a rule of thumb, you should be drawing 4% or less of your retirement savings to avoid spending through it prematurely. This is just a general rule, you should consult with your investment advisor representative for what is right for your situation. Investments that generate income such as interest and dividends can be important to help replace the money you spend. If saving money in retirement means spending less, retirees can find lots of great discounts allowing them to spend less in retirement. Retirees can take advantage of discounts on retail purchases, travel, memberships, and pharmacies. Some retirees may even seek out places to reside with favorable tax situations to help them save money in retirement. Final Thoughts Regardless of where in the financial planning process you are, cash flow is an important aspect of evaluating your situation and planning for your future. Thinking beyond budgeting; your cash flow is the most important tool for building long term wealth. If you are not sure where to start, meeting with a trusted financial advisor is a great first step. Our team of fiduciary advisors can help you to determine where you are now and how to accomplish your goals. Rebecca Agamaite Investment Advisor Representative  Rebecca joined the firm in 2011 as an Investment Advisor Representative. In this role, she works with clients to manage their investment assets and help them obtain their financial objectives. Rebecca brings a great deal of experience to the team having worked for several years at Marshall & IIsley Bank and MetLife. She earned a Masters of Business Administration degree (with an emphasis on finance) from Concordia University. Advisors Management Group, Inc. is a registered investment adviser whose principal office is located in Wisconsin.   Opinions expressed are those of AMG and are subject to change, not guaranteed, and should not be considered recommendations to buy or sell any security.  Past performance is no guarantee of future returns, and investing involves multiple risks, including, but not limited to, the risk of permanent losses.  Please do not send orders via e-mail as they are not binding and cannot be acted upon.  Please be advised it remains the responsibility of our clients to inform AMG of any changes in their investment objectives and/or financial situation.  This commentary is limited to the dissemination of general information pertaining to AMG’s investment advisory/management services.  Any subsequent, direct communication by AMG  with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides.  A copy of our current written disclosure statement discussing our advisory services and fees continues to remain available for your review upon request.

Whether you are planning to do your own, or hire a pro, you are probably getting ready to file your tax return soon. You may wonder why you need to file a tax return. Think of your return like this, you probably made money from a few different sources (income) last year. You probably paid some tax along the way (withholding). You probably get some tax breaks (deductions). Your tax return adds up the income, subtracts off your deductions and determines how much tax you owe. This amount is compared to what you paid throughout the year. If you paid too much, you get a refund. If you didn’t pay enough, you have an amount due. As you assemble your documents, it can be helpful to understand what documents you should be looking for and how they tell the story of your prior year. Income Forms If you are an employee of a company: If you are employed, you will likely get a W-2. This form reports how much you made, taxes withheld and voluntary deductions such as health insurance and retirement savings. If you work for yourself: 1099-NEC is issued to those who work as consultants, independent contractors and those who take temporary assignments such as traveling health professionals. If you have bank accounts, investments or cashed savings bonds: If you have savings, be on the lookout for several different 1099 forms. 1099-INT reports interest earned. 1099-DIV reports dividends earned. 1099-B reports stock sales. 1099 Composite is a combination of 1099-B and 1099-DIV. These are commonly associated with checking, savings, and brokerage accounts. 1099-R reports income that comes from retirement accounts such as IRA’s and pensions. Note that if you rolled over a 401k to an IRA, you may receive a 1099-R even though you did not have a taxable event. If you are disabled or retired: If you are receiving Social Security payment in retirement, due to disability or as a survivor’s benefit, you will receive a SSA-1099. If you were unemployed: If you received unemployment benefits, you should expect a 1099-G. If you were a lucky winner If you won money or a prize as the result of a contest or gambling, you should expect to receive a 1099-MISC or W2G. Deduction/Credit Forms Forms for Homeowners 1098 reports mortgage Interest, Property Tax Bill. Education If you have a student with college tuition, their school will issue a 1098-T. Dependent Care If you have a child or qualified dependent in daycare or other dependent care, be sure to get a receipt from your provider that includes the EIN/Social Security number of the care provider. Renters Rent payments can be used as a deduction or used towards a credit on some state tax returns. In some cases, you may need a rent certificate from your landlord. Charitable Donations Due to the increased standard deduction, most people will not be able to use charitable donations on their federal return however, your state may offer some tax benefits for donations. Help for Those in Need If you have tax questions or need help preparing your taxes, but are unable to pay for help, check out resources in your community that aid low-income individuals, disabled and retired people in navigating simple tax returns at low or no cost. Organizations like Goodwill, VITA and AARP have volunteers on hand who have tax knowledge and can help those in need. Final Thoughts Many people find tax season to be stressful. Keep in mind that with a little up-front organization, tax season can be a breeze. Before gathering your documents for this year’s return, you may find it helpful to review last year’s return to see what forms you had last year. Use this year’s completed return as a planning tool for the year ahead. If you owed too much money or got too much back, consider adjusting your withholding. If you have deductions that you will lose in the coming year, you may also need to change your withholding. Small changes early in the year can help you avoid the unexpected next year.   Rebecca Agamaite Investment Advisor Representative  Rebecca joined the firm in 2011 as an Investment Advisor Representative. In this role, she works with clients to manage their investment assets and help them obtain their financial objectives. Rebecca brings a great deal of experience to the team having worked for several years at Marshall & IIsley Bank and MetLife. She earned a Masters of Business Administration degree (with an emphasis on finance) from Concordia University. Advisors Management Group, Inc. is a registered investment adviser whose principal office is located in Wisconsin.   Opinions expressed are those of AMG and are subject to change, not guaranteed, and should not be considered recommendations to buy or sell any security.  Past performance is no guarantee of future returns, and investing involves multiple risks, including, but not limited to, the risk of permanent losses.  Please do not send orders via e-mail as they are not binding and cannot be acted upon.  Please be advised it remains the responsibility of our clients to inform AMG of any changes in their investment objectives and/or financial situation.  This commentary is limited to the dissemination of general information pertaining to AMG’s investment advisory/management services.  Any subsequent, direct communication by AMG  with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides.  A copy of our current written disclosure statement discussing our advisory services and fees continues to remain available for your review upon request.

In 2022, in attempts to stop runaway inflation, the Federal Reserve increased Federal Funds rate 7 times increasing rates a total of 4.25%. This is perhaps one of the most aggressive increases in recent history, but what does it mean for you? Let’s take a little look at how the Federal Reserve works and how the process of monetary control affects you. Despite what the name may suggest, the Federal Reserve or “The Fed” is not a part of any government. Rather, it is an independent central bank that serves our country.  Most countries have a similar central bank that controls the money system for their country. Our own central bank was approved by Congress under The Federal Reserve Act of 1913, and it was signed into law by Woodrow Wilson. Although is not part of the government and operates primarily independently of federal government, it is overseen by the board of governors, a group chosen by the President of the United States and approved by Congress. The job of the Fed is to serve as the bank to retail banks assisting in the movement of money in the US and beyond. It is broken into 12 Federal Reserve Districts that cover different areas of the country. District Federal Reserve branches are the bank at the top of the system that includes your local bank or credit union. Your bank uses the Fed to obtain money for lending and for the process of clearing transactions. The Fed also controls the US’s money supply through monetary policy. Think of monetary policy like a big dam. Money sits in the reservoir behind the dam and The Fed allows for money to run down the dam structure and down the river to you and me.  When the Fed uses loose monetary policy, there is more money flowing down the line and when they are tightening monetary policy, they are holding more in the reservoir. Different monetary control styles are used during different times as the economy moves through different phases of the economic cycle. 2022’s Fed rate hikes are an example of tightening monetary control. One of the more noticeable effects of the 2022 Fed rate hikes was the quick changes to the real estate market. Rate hikes caused an increase of activity as buyers became fearful that rising rates would make payments less affordable. The flurry of activity quickly gave way to a slowdown as some buyers either edged out of the marketplace or decided to hold off. Money became more expensive to borrow keeping more of it in the reservoir. You may have felt frustrated if you have ever been trying to make a major purchase during the recent rising interest rates, but there are other things at play during changes in monetary control. Ultimately, 2022’s rate hikes were aimed at lowering the unstainable inflation which affects the prices of everything we buy. Although it is unlikely to quickly bring the price of your eggs and milk down, the hope is that we would see prices begin to stabilize, a return to a more normal inflation rate. There are two sides to the coin when it comes to monetary policy. While borrowers began to see the effects of higher interest rates, those saving also did. For the first time in a long time, rates on savings accounts, CDs and bonds began to climb. As rates continue to climb, it is expected that fixed rates will be beneficial to people wanting to save. This can be a welcome sight for those savers who are becoming exhausted from the rocky market conditions that existed throughout the year 2022. Though you may give little thought to the Federal Reserve and how it works, it affects how you transact, spend, and save. By understanding a little about what the Fed’s role in our economy is, you can better understand what risks and opportunities are available for you because of the Fed. If you would like to discuss how recent how recent changes in interest rates have affected your financial situation, please feel free to contact our team for a complimentary consultation. We have experienced financial advisors located in Eau Claire, La Crosse, and Green Bay. Rebecca Agamaite Investment Advisor Representative  Rebecca joined the firm in 2011 as an Investment Advisor Representative. In this role, she works with clients to manage their investment assets and help them obtain their financial objectives. Rebecca brings a great deal of experience to the team having worked for several years at Marshall & IIsley Bank and MetLife. She earned a Masters of Business Administration degree (with an emphasis on finance) from Concordia University. Advisors Management Group, Inc. is a registered investment adviser whose principal office is located in Wisconsin.   Opinions expressed are those of AMG and are subject to change, not guaranteed, and should not be considered recommendations to buy or sell any security.  Past performance is no guarantee of future returns, and investing involves multiple risks, including, but not limited to, the risk of permanent losses.  Please do not send orders via e-mail as they are not binding and cannot be acted upon.  Please be advised it remains the responsibility of our clients to inform AMG of any changes in their investment objectives and/or financial situation.  This commentary is limited to the dissemination of general information pertaining to AMG’s investment advisory/management services.  Any subsequent, direct communication by AMG  with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides.  A copy of our current written disclosure statement discussing our advisory services and fees continues to remain available for your review upon request.

Whether it’s on your phone, on the nightly news or scrolling on the bottom banner of your web browser, you probably have seen the performance of the market indexes such as the Dow Jones Industrial or the S&P 500. We see the familiar red and green arrows as we go about our days without giving it much thought. Some people bring the indexes up in casual conversation, but few people take the time to really understand what they are or how they apply to them. Let’s break down some basics about indexes, how they work, and what they mean to you. What are indexes? Indexes are hypothetical portfolios representing different parts of the financial market. The ones investors are most familiar with are the Dow Jones Industrial Average (DJIA), S&P 500 and the Nasdaq Composite. There are plenty of other indexes that might be less familiar to you. To state this in simple terms, indexes are groups of company stocks. Depending on how well the companies are doing, their stock prices will move up or down. If times are good and companies are profitable, the indexes will move up. During hard times, the stock prices will decrease, and the indexes will move down. What makes up the indexes? S&P 500 -Standard & Poor’s 500 Index is a grouping of 500 of the leading publicly traded companies. Companies with more shares outstanding and higher capital make up the largest percentage. Currently Apple holds the largest percentage of the 500, DaVita Inc, is the smallest of the 500. Dow Jones Industrial Average, or simply the Dow- The Dow is the oldest and perhaps the most familiar index. It includes companies that are found globally. It includes 30 companies who are ranked by their price. UnitedHeath Group, Inc is the top company with a price over $500 per share, Intel is the lowest ranking with a current price under $30 per share. Nasdaq- The Nasdaq is one of the largest US indexes. It includes nearly every company that trades on the Nasdaq stock exchange. It is the most misunderstood index because it has some unique characteristics. Some people call it the tech index, although it is not exclusive to any industry. To be included, a company must trade exclusively on Nasdaq stock exchange unless it was there prior to that rule being made in 2004. This means that unless grandfathered in, none of the companies in Nasdaq appear on the NYSE, Philadelphia Stock Exchange, American or another exchange unless they have been there for a very long time. Some of its largest holdings, Apple, Microsoft, Meta, Alphabet, Tesla and others also appear as some of the top positions in the S&P 500. How does this apply to me? Aside from giving you something to talk about other than the weather, you may find that it’s helpful to know the current state of the market. It is kind of like looking at a thermometer for your investments. Having an idea of what is going on in the market can prepare you for what is going on in your own retirement accounts and investments. If you are seeing a lot of red days, it probably means that you can expect to see some losses in your account. Keep in mind, it’s just an idea of how things are going in the financial markets. Just because the S&P 500 or Dow Jones is down 10% year to date doesn't mean your portfolio is down 10%. You have your own group of investments in your personal portfolio and your portfolio has its own return based upon what you are holding and how much risk you are taking in your portfolio. Your advisor may discuss the market index’s performance and compare it to your performance. This is called using an index as a benchmark. This same strategy also applies for risk. You can determine if your portfolio has more risk, less risk, or similar risk. An aggressive investor may have a portfolio with nearly as much risk as the S&P 500 whereas a conservative investor may not be comfortable with that much risk. Most people misunderstand how to use an index as a benchmark. Often, we see people judging the success of their portfolio by how it compares to an index. Instead, you should judge your portfolio based on your long-term goals and how well your portfolio is set up to achieve your goals. Can I invest in an index? While you cannot invest in the actual index, there are mutual funds and ETF’s that mirror the index. These buy the exact same stocks that are in the indexes and their return can be similar. While this could be appealing, there can be downsides to this type of strategy. Index funds are not actively managed and can potentially carry more risk than an actively managed strategy. Finding a knowledgeable advisor can help you to decide what is right for your portfolio and how it relates to the broad markets   Rebecca Agamaite Investment Advisor Representative  Rebecca joined the firm in 2011 as an Investment Advisor Representative. In this role, she works with clients to manage their investment assets and help them obtain their financial objectives. Rebecca brings a great deal of experience to the team having worked for several years at Marshall & IIsley Bank and MetLife. She earned a Masters of Business Administration degree (with an emphasis on finance) from Concordia University. Advisors Management Group, Inc. is a registered investment adviser whose principal office is located in Wisconsin.   Opinions expressed are those of AMG and are subject to change, not guaranteed, and should not be considered recommendations to buy or sell any security.  Past performance is no guarantee of future returns, and investing involves multiple risks, including, but not limited to, the risk of permanent losses.  Please do not send orders via e-mail as they are not binding and cannot be acted upon.  Please be advised it remains the responsibility of our clients to inform AMG of any changes in their investment objectives and/or financial situation.  This commentary is limited to the dissemination of general information pertaining to AMG’s investment advisory/management services.  Any subsequent, direct communication by AMG  with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides.  A copy of our current written disclosure statement discussing our advisory services and fees continues to remain available for your review upon request.

The year 2008 proved emotionally exhausting for investors. Volatility rocked the markets causing the S&P to hit lows more than -17% by mid-July. Late summer brought a slight recovery and quieter conditions only to have the market plummet in October resulting in a new bottom of over -42%. Although these types of market conditions don't happen regularly, they can really cause emotional turmoil for investors when they come to pass. Here’s what you need to know about riding out the storm and keeping your cool while investing during market volatility. Don't assume Your portfolio is not “the market”. If you see that the S&P or the Dow Jones are down 2% in a day, it does not mean that you lost the same amount. Indexes can give you an idea of what is going on, but they are highly dependent on a few companies. For example, Apple currently makes up a whopping 6.59% of the S&P 500. If Apple moves significantly, the index is sure to be affected. Your portfolio, on the other hand, may not have any Apple in it. You also may have investments that are not in the S&P 500 at all. Your portfolio could include a mix of stocks, bonds, cash and even commodities such as precious metals. It’s best not to make any assumptions about what your portfolio is doing based upon what the indexes are doing. Instead, discuss your allocation and risk level with a trusted investment advisor regularly to determine what you should expect if markets move significantly. Don’t make emotional decisions We've all heard that you should buy low and sell high but making emotional decisions can cause investors to do just the opposite. Investors who panicked and sold out in October of 2008 most likely missed at least part of the recovery that followed in 2009 and 2010. Some investors who tried to jump back in at some point during the recovery re-entered the market at higher prices than they sold out at. Panicked investors aren't the only investors to be affected by emotional investment mistakes. Bullish investors sometimes are quick to call the bottom of a market and may find that FOMO (fear of missing out) causes them to overpay or take unnecessary losses. It’s generally best to avoid jumping in and out and trying to time the market, when investing during market volatility. Don’t overdo it on the withdrawals If you are a retiree depending on your account for income, don't panic. Your portfolio is likely designed to provide income from dividends and interest in addition to giving you the potential for modest growth. If you stick to your planned distribution, your portfolio should be able to weather the market volatility and still provide what you need. On the other hand, you may want to wait to take distributions for large purchases that require your securities to be sold at a loss in order raise enough cash to fund the purchase. Do stay calm If you feel emotional about money, it’s ok and it’s normal. We work hard for what we have saved, and it can make you very upset when you see losses during times of market volatility. You may feel better to know that the money it’s not been taken out of the account. In fact, when your investments go up, no one made a deposit. Investment gains and losses represent a change in the value of the shares you own. You do not own your balance. You own the shares in your portfolio. Sometimes your shares will be worth more than you paid, and sometimes, the value will be less than you paid. If you've been investing for a while, you probably have more money than what you’ve deposited from your own money. Investments never move upward in a straight line. They will move in both directions with a trend of moving upward over time. It’s a marathon, not a sprint. Do keep focused on the long term If you are a saver, these are great opportunities for adding to your long-term wealth. Now is not the time to stop saving. We want to buy low and market dips can offer us the opportunity to get the biggest bang for the investing buck. Our systematic savings buys more shares. If you are retired and are taking money out instead of saving, you still need to be focused on the long term. A person who retires in their 60’s will weather three or four bear markets and many corrections during retirement. Just because you are retired does not mean that you have a short investment horizon. Someone retiring in their 60’s very well can have a 20–30-year investment horizon based upon life span. Do seek advice on withdrawals, taxes, and security sales Planning how you take money out of your portfolio is always important, but it’s especially important to be smart during down years. A trusted advisor can help set up your portfolio with cash and income like dividends and interest so you are not selling securities at a loss. There may also be certain securities that are up in value when the broad markets are down, which could be sold, if needed, to provide cash for a withdrawal. Your advisor can also give you a heads up about what to expect at tax time because sometimes investors are caught off guard by taxable events that happen even though portfolio values may be negative. Do review your portfolio You may be afraid to look when you are losing. By meeting with your advisor, you can get reassurance and insight about what is going on in the world and how it is affecting your nest egg. You may even find out that it’s not as bad as you thought. A good advisor will want to let you know what is happening and explain how your portfolio has responded to the market conditions. If you haven't heard from your advisor, it may be time to consider finding another one. Negative markets and statements with negative returns are scary. You may be feeling like you need to quick do something to stop the bleed, or you may feel emotionally defeated, but know that the market is bound to go up and down. Stay focused on your goals and rely on your trusted advisor to guide you toward your goals, especially when investing during times of market volatility.   Rebecca Agamaite Investment Advisor Representative  Rebecca joined the firm in 2011 as an Investment Advisor Representative. In this role, she works with clients to manage their investment assets and help them obtain their financial objectives. Rebecca brings a great deal of experience to the team having worked for several years at Marshall & IIsley Bank and MetLife. She earned a Masters of Business Administration degree (with an emphasis on finance) from Concordia University. Advisors Management Group, Inc. is a registered investment adviser whose principal office is located in Wisconsin.   Opinions expressed are those of AMG and are subject to change, not guaranteed, and should not be considered recommendations to buy or sell any security.  Past performance is no guarantee of future returns, and investing involves multiple risks, including, but not limited to, the risk of permanent losses.  Please do not send orders via e-mail as they are not binding and cannot be acted upon.  Please be advised it remains the responsibility of our clients to inform AMG of any changes in their investment objectives and/or financial situation.  This commentary is limited to the dissemination of general information pertaining to AMG’s investment advisory/management services.  Any subsequent, direct communication by AMG  with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides.  A copy of our current written disclosure statement discussing our advisory services and fees continues to remain available for your review upon request.

When illness or injuries occur, paying for out-of-pocket medical expenses can be overwhelming for many people. By planning ahead and saving a little bit every month you can feel prepared to deal with unexpected medical costs. If you are a participant in a high deductible HSA eligible health insurance plan, a Health Savings Account can be an important part of your overall financial picture. Which insurance plans are eligible? For 2021, an HSA eligible plan must have a deductible of at least $1,400 for and individual and $2,800 for a family plan. HSA eligible plans require the insured to pay for most expenses out of pocket until the deductible is met.  It is important to understand that not every insurance plan is HSA eligible even if the deductible is high. How do HSA’s work? An HSA account allows you to put pre-tax dollars into a savings account, then use those dollars to pay medical expenses without ever paying any tax on the dollars used for the payment. The maximum annual deferral amount depends upon the type of health insurance coverage you have.  Also, the annual contribution limit usually increases slightly each year so you may want to adjust accordingly. HSA eligible health insurance plans may cost less which may allow you to choose to invest what you are not spending on premiums. How much can I save? For individuals with single health insurance coverage the annual contribution limit is $3,600.  For individuals with family health insurance coverage the annual contribution limit is $7,200.  If you are over the age of 55, you can contribute up to an additional $1,000 per year to increase, your maximum annual contribution to $4,600 or $8,200 depending upon the type of health insurance coverage you have. Contributions can be deductible on your tax return if they are paid out of pocket instead through salary deferral from your employers’ payroll. Additional Benefits Some additional advantages an HSA account provides include: At the age of 65 you can treat your HSA like an IRA and take distributions for purposes other than medical expenses without penalty, although you will pay income tax on the distribution. You can invest the assets in the account no matter what your income is. There are no income limits to be eligible to contribute unlike an IRA.  Once your income goes above a certain level you can no longer make tax deductible contributions to an IRA. For higher income earners an HSA is one of the few ways to save money tax deferred. You can do a once in a lifetime tax free rollover from an IRA to an HSA up to the annual contribution limit. However, you must remain in a high deductible health insurance plan for at least 12 months following the rollover. You are not allowed make rollover contributions to an HSA from a 401(k), 457, or other retirement plan. You can first roll money over to an IRA and then do a rollover from the IRA to the HSA There are options available for those who want to grow their HSA in the equities market. This can be attractive for those who don’t typically spend down their HSA on an annual basis or those who have accumulated a larger balance. Can I use my HSA to pay health insurance premiums? You can only use your HSA to pay health insurance premiums if you are collecting Federal or State unemployment benefits, or you have COBRA continuation health insurance coverage through a former employer. Nathan Deets CFP Investment Advisor Representative & Tax Preparer Nathan joined the firm in 2006. As an Investment Advisor Representative, he is part of the team that designs our clients’ investment portfolios, prepares individual tax returns, and helps our Advisor Team with financial planning for our clients. Advisors Management Group, Inc. is a registered investment adviser whose principal office is located in Wisconsin.   Opinions expressed are those of AMG and are subject to change, not guaranteed, and should not be considered recommendations to buy or sell any security.  Past performance is no guarantee of future returns, and investing involves multiple risks, including, but not limited to, the risk of permanent losses.  Please do not send orders via e-mail as they are not binding and cannot be acted upon.  Please be advised it remains the responsibility of our clients to inform AMG of any changes in their investment objectives and/or financial situation.  This commentary is limited to the dissemination of general information pertaining to AMG’s investment advisory/management services.  Any subsequent, direct communication by AMG  with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides.  A copy of our current written disclosure statement discussing our advisory services and fees continues to remain available for your review upon request.

When you’re choosing a health plan for the year -- whether you get coverage through your employer or on your own -- one option may be a high-deductible plan that makes you eligible to contribute to a health savings account. Weigh this option carefully. There are a lot of misconceptions about how HSAs work. Health savings accounts offer a triple tax break -- contributions aren’t taxed, the money grows tax-deferred, and it can be used tax-free for eligible medical expenses at any time. Here, we take a look at several of the most common HSA myths -- and the reality. Myth: You Must Use HSA Money by Year-End This is the biggest misconception about HSAs. Unlike flexible spending accounts, HSAs have no use-it-or-lose-it rule. You can use the money tax-free to pay eligible medical expenses at any time. The money can pay current medical expenses -- such as your insurance deductible, co-payments for health care and prescription drugs, and out-of-pocket costs for vision or dental care -- but you’ll get the biggest tax benefit if you keep the money growing in the account and withdraw it for medical expenses much later, such as in retirement. You can withdraw HSA money tax-free, for instance, to pay Medicare Part B, Part D and Medicare Advantage premiums after you turn age 65. Most HSAs let you invest the money in mutual funds for the long term. Myth: You Can Only Get an HSA Through Your Employer Although many employers pair an HSA with a high-deductible health insurance plan, anyone with an HSA-eligible health insurance policy can contribute to an HSA. (HSA-eligible policies must have a deductible of at least $1,350 for single coverage or $2,700 for family coverage in 2019.) Many banks and other financial institutions offer health savings accounts. You can find HSA administrators at www.hsasearch.com, where you can compare fees and investing options. If your employer does offer an HSA, however, that’s usually your best option because many employers contribute money to employees’ HSAs (an average of $500 per year for individuals and $1,000 for families), and employers tend to cover most of the fees for employees’ HSAs. Also, contributions made through payroll deduction are pre-tax, avoiding federal and Social Security taxes. If you contribute to an HSA on your own, your contributions are tax-deductible. Myth: You Can’t Use Money in the HSA After You Sign Up for Medicare You can’t make new contributions to an HSA after you enroll in Medicare, but you can continue to use the money that’s already in the account tax-free for out-of-pocket medical expenses and other eligible costs that aren’t covered by insurance, such as vision, hearing and dental care and co-pays for prescription drugs. You can also take tax-free withdrawals to pay a portion of long-term-care insurance premiums based on your age, ranging in 2018 from $410 if you’re 40 or younger to $5,110 if you’re 70 or older. And after you turn 65, you can use HSA money to pay premiums for Medicare Part B, Part D or Medicare Advantage. You can even withdraw money from your HSA to reimburse yourself if your Medicare premiums are paid directly out of your Social Security benefits. “You just need to keep your payment notification from Social Security in your tax records, and you can reimburse yourself dollar for dollar,” says Steven Christenson, executive vice president at Ascensus, a benefits consultant. Myth: You Can’t Contribute to an HSA After You Turn 65 Eligibility to make HSA contributions stops when you enroll in Medicare. That’s not necessarily when you turn 65. Some people who keep working for a large employer at age 65 choose to delay signing up for Medicare Part A and Part B so they can continue to contribute to an HSA (especially if their employer contributes money to the account, too). However, you can only delay signing up for Medicare at 65 if you have health insurance from a current employer (or if you have coverage through your spouse’s employer); the employer generally must have 20 or more employees. Otherwise, you generally have to sign up for Medicare at 65. If you are eligible to delay signing up for Medicare, be sure to enroll within eight months of losing your employer coverage so you won’t have a late-enrollment penalty. You can make pro-rated HSA contributions for the number of months before your Medicare coverage takes effect. If you sign up for Medicare Part A after age 65, your coverage takes effect retroactively six months before you enrolled. Myth: You Must Get Permission From HSA Administrators to Withdraw Money Unlike with an FSA, which usually requires you to gather receipts and get permission from the administrator to make withdrawals, you can withdraw money from your HSA whenever you want. Many HSAs have debit cards that make it easy to use the account for eligible expenses, but you can also withdraw money on your own and keep the records in your tax files to prove that the withdrawals should be tax-free. “FSAs require the administrator to substantiate the claim, but with HSAs, there is no substantiation requirement -- you just have to keep the receipts,” says Steve Auerbach, CEO of Alegeus, which provides technology for HSAs. Myth: You Must Use HSA Funds Within a Certain Time Period After You Incur Medical Bills One quirk of the HSA rules is that there’s no time limit for using the money after you incur an expense. Say you have knee surgery and pay a $1,000 deductible in cash. As long as you had the knee surgery after you opened an HSA, you can withdraw that $1,000 tax-free from the account anytime -- even years later. You just need to keep track of your receipts for the HSA-eligible expenses. Many HSA administrators make it easy to import medical claims-payment records from your health insurance to your HSA and keep track of whether you paid the bill with your HSA or with cash. “We store all of those claims and receipts for you. If, say, in two years you want to take the money out, it can come out tax-free because you’ve already incurred those expenses,” says Auerbach, of Alegeus. Myth: You Can Only Invest the HSA Money in a Savings Account HSAs have savings accounts, so you know the money will be there if you plan to use it for current expenses. But many HSA administrators also let you invest the money in mutual funds for the long term. The fees and investing options vary a lot by company -- some offer low-cost funds from Vanguard, Fidelity and other well-known fund companies. You can compare fees and investing options at www.hsasearch.com. Some HSA administrators charge extra fees unless you maintain a minimum balance. Myth: Your Spouse and Kids Can Only Use HSA Money If Covered by Your Health Plan The rules for contributing to an HSA are different than they are for using the money. For 2019, you can contribute up to $3,500 to the account if you have health insurance coverage on you only or up to $7,000 if you have family coverage. You can also contribute an extra $1,000 if you’re 55 or older. But no matter whether you have individual or family health insurance coverage, you can use the HSA money tax-free for qualified medical expenses for yourself, your spouse and your tax dependents -- even if those family members are covered under a different policy, says Roy Ramthun, CEO of HSA Consulting Services. Myth: You Can’t Use the HSA After You Leave Your Job Here’s another way that HSAs differ from FSAs: You can keep the HSA even if you leave your job. You can usually maintain the HSA through the current administrator or roll it over to a different one (similar to an IRA rollover). And if you have an HSA-eligible high-deductible policy -- whether through a new employer or on your own -- you can continue to contribute to the HSA. Myth: It Doesn’t Make Sense to Have an HSA-Eligible Policy If You Have a Lot of Medical Expenses Some people are reluctant to choose a high-deductible health insurance policy if they have a lot of medical expenses. But you need to do the math and compare the overall costs. In some cases, the premium savings by choosing the high-deductible policy rather than a lower-deductible plan may cover most of the difference in the deductible. And if you have employer coverage, your employer may contribute to your HSA to help close the gap. The employer contribution is generally seed money rather than a match. Many employers deposit a fixed amount of money into the account at the beginning of the year for anyone who has an HSA-eligible policy, says David Speier, managing director of benefits accounts at Willis Towers Watson, a benefits consultant. Add up the difference in premiums, deductibles and other out-of-pocket costs for your regular medical expenses, as well as any employer contribution, when deciding on a policy. Many employers are introducing decision-making tools to help with the calculations, says Speier. Source: Kiplinger