If there's one thing I've learned in my years advising real estate investors, it's this: The tax code doesn't care about your feelings. It does, however, reward you handsomely if you know which tools to pick up and when.

The problem is that most investors think of 1031 exchanges, Delaware statutory trusts and Qualified Opportunity Zones as one-size-fits-all solutions. They're not.

Recommending a 1031 exchange to every investor who walks through the door is like a doctor prescribing the same medication to every patient. Sure, aspirin is great, but it's not going to fix a broken leg.

So let's meet four very different investors, each facing a unique set of circumstances, and match them with the tax strategy that fits like a glove.

Henry: The stock market refugee

Henry spent 25 years building a seven-figure stock portfolio. Then came the tariff whiplash of late 2025 and the energy crisis of 2026, and Henry watched a decade of gains get rattled in a matter of weeks. He didn't just lose money — he lost sleep, his appetite and his faith in Wall Street.

Now Henry wants out. He's sitting on stock he'd like to sell, but the remaining gains still carry a hefty capital gains tax bill. And he wants something he can see and touch — something that doesn't swing 3% before breakfast.

Henry's play: A Qualified Opportunity Zone fund. When he sells his stock, those capital gains can be reinvested into a QOF within 180 days. The original gain gets deferred, and if he holds the QOZ investment for at least 10 years, any new appreciation is tax-free. The growth on his new investment owes nothing to Uncle Sam.

Better still, the One Big Beautiful Bill Act (OBBBA) has made the Opportunity Zone program permanent, introducing a rolling five-year deferral for gains invested after December 31, 2026, and a 10% basis step-up for those who hold for at least five years.

For stock market refugees like Henry who want to pivot into tangible real estate while getting a serious tax break, QOZs are the escape hatch.

One important note: Henry doesn't qualify for a 1031 exchange because he's selling stocks, not real estate. The QOZ program, unlike Section 1031, accepts capital gains from virtually any asset class: Stocks, crypto, businesses, art, you name it. That's what makes it the Swiss Army knife of capital gains strategies.

Rachel and Tom: The divorcing couple

Nobody gets married planning for a divorce, but here we are. Rachel and Tom own three rental properties together, and now they need to split everything up, ideally without handing a third of their equity to the IRS in the process.

Their situation is more common than you'd think and more treacherous than most people realize. If they simply sell all three properties and divide the cash, the capital gains taxes could be devastating: Potentially hundreds of thousands of dollars in federal and state taxes, plus depreciation recapture, gone before either party sees a dime.

Rachel and Tom's play: A 1031 exchange into Delaware statutory trusts. They sell the properties and use a qualified intermediary to execute a 1031 exchange, but instead of buying replacement properties together (which, given the circumstances, has obvious shortcomings), they each exchange into separate DST investments.

DSTs allow each of them to invest independently in institutional-grade real estate — think Class A apartment complexes or Amazon distribution centers — with minimum investments typically starting around $100,000.

Each party gets their own portfolio, their own monthly distributions and their own tax deferral. No more joint ownership. No more awkward phone calls about the leaking roof on Property No. 2.

The DST structure also eliminates the 45-day identification panic that sinks so many 1031 exchanges. Because DST properties are prepackaged and already acquired by the sponsor, Rachel and Tom can identify their replacement investments quickly, even under the emotional fog of divorce proceedings.

It's the cleanest possible split, with the least possible tax damage.

Sofia: The empire builder

Sofia is 42, owns a couple of single-family rentals and is hungry for more. She's not looking for a beach chair and a mailbox full of passive income; she's looking for a ladder. Her goal is to consolidate her smaller properties into larger, higher-performing commercial real estate and build serious generational wealth.

Sofia's play: The classic 1031 exchange, the way it was drawn up over a hundred years ago. She sells her two rental homes — let's say for a combined $800,000 — and rolls the full proceeds into a 20-unit apartment building worth $2 million, financing the balance with a mortgage. No capital gains taxes due. Every dollar of equity stays in the game.

This is the power of the 1031 exchange in its purest form: The ability to trade up without the tax drag. If Sofia had sold those two rentals and paid federal and state capital gains taxes, plus depreciation recapture, she might have lost $150,000 or more off the top.

That's not just money lost; that's leverage lost. It's the difference between a 20-unit building and a 12-unit building, between scaling an empire and treading water.

And Sofia doesn't have to stop there. Five or 10 years down the road, she can 1031 that apartment building into an even larger asset — a retail center, an industrial property, a portfolio of commercial buildings.

Each exchange defers the gains from the last one, creating a compounding effect that has made more real estate millionaires than any other provision in the tax code.

If she's strategic enough to hold her final property until death, her heirs receive a stepped-up cost basis, potentially wiping out every dollar of deferred gains along the way.

That's not just a tax strategy. That's a dynasty play.

Raymond: The high-income professional

Raymond is a plastic surgeon earning north of $800,000 a year. His tax bill is, to put it delicately, eye-watering. He wants two things: Passive income that doesn't require him to leave the operating room, and every legitimate tax deduction he can get his hands on.

Raymond's play: A combination strategy. First, he invests directly in DSTs that offer bonus depreciation. Under the newly restored 100% bonus depreciation rules, Raymond can potentially offset a significant portion of his passive income with accelerated depreciation from his DST investments — paper losses that reduce his tax bill without reducing his actual wealth.

Second, Raymond allocates a portion of his capital gains from stock sales or other investments into a Qualified Opportunity Zone fund, starting the 10-year clock toward tax-free appreciation. With the OBBBA making the OZ program permanent, Raymond has a long runway to compound gains without the drag of annual capital gains taxes.

The combination of DST depreciation benefits and QOZ tax-free growth creates a one-two punch that's hard to beat for high earners. Raymond gets monthly passive income from the DSTs, a meaningful reduction in his current tax liability and a long-term growth vehicle in the QOZ, all without ever picking up a wrench or answering a tenant's midnight phone call.

Your move

If you see yourself in any of these scenarios — or in some combination of them — the worst thing you can do is nothing. The tax code rewards action, and every day you delay is a day your money is working harder for the government than it is for you.

The best thing you can do? Find an investment adviser who understands not just one of these strategies, but all of them. Find someone who can look at your complete financial picture and recommend the right tool for the job, not just the only tool they happen to sell.

Because in the world of tax-advantaged real estate investing, the right strategy isn't the most popular one. It's the one that fits you.

Related Content

• How the Energy Crisis Is Reshaping Real Estate Investment Strategy (and Creating Opportunities Most Investors Don't See)
• When Is a 1031 Exchange Not the Right Move? A Real Estate Investing Pro Offers a Reality Check for Your Next Exit
• What a Delaware Statutory Trust Can Do for Your Kids That Your Will Can't
• DST Inventory Just Hit a Record $3.9 Billion: What 1031 Exchange Investors Should Do Next
• I'm a Real Estate Investing Pro: This Is How to Use 1031 Exchanges to Scale Up Your Real Estate Empire

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

I live in Arizona, and during monsoon season, we know what a black cloud looks like.

You can see it building in the distance. The sky gets darker. The temperature changes. The wind starts to pick up. Even though nothing has happened yet, you worry about it.

Is it going to rain? How bad will it be? Will there be hail? High winds? A dust storm? Is it even going to hit us — or will it pass by?

The other day, the clouds were dark enough that I called my 17-year-old daughter and told her to be careful driving. There wasn't a storm at our house yet, but I knew there was enough risk that it was worth thinking ahead.

Those clouds are a good metaphor for how I look at long-term care: It's the black cloud of retirement planning.

You know the cloud is out there

Most people approaching retirement understand they might need some form of long-term care. What they don't know is what it will look like. They're likely asking themselves:

• Will I need long-term care at all?
• When will I need it?
• Will my spouse be able to take care of me?
• Will I need a little help at home or full-time care?
• Will I need help for six months or six years?
• How much might that care cost?
• What happens financially to my spouse if I'm the one who needs care?

That's a lot of uncertainty hanging over a retirement plan, which makes long-term care so uncomfortable to discuss.

• We can estimate how much income someone will need in retirement
• We can model Social Security
• We can build an investment portfolio
• We can discuss taxes and estate planning

But long-term care is different.

We don't know if or when the storm is coming, how long it will last or how severe it will be.

That's why we should plan for it.

The storm isn't just about money

When people hear "long-term care planning," they often think about the financial hit. But that's not always the biggest risk.

Long-term care can become a family issue before it becomes a financial problem.

Someone must coordinate doctors, medications, transportation and care facilities. A spouse might become the primary caregiver. Adult children might begin rearranging work schedules and family responsibilities. Families are often forced to make difficult decisions when they're already feeling stressed.

There's also the potentially substantial cost.

Imagine a married couple who have spent 30 or 40 years saving for retirement. They've built a nest egg that's meant to provide income for two people. They have travel plans. They want to help their grandchildren. Maybe they want to leave something to their children.

Then one spouse needs significant care.

Suddenly, the same pool of assets has two jobs. It must provide for the healthy spouse's retirement while simultaneously paying for the other spouse's care expenses.

That's why I believe the long-term care planning conversation should start with people, not products.

What would you want to happen?

Before discussing insurance and other options, I like the idea of asking some basic questions:

• If you needed care, where would you want to receive it?
• Would you prefer to remain at home as long as possible?
• Who would you expect to help you?
• What assets would you be comfortable spending?
• How important is preserving assets for your spouse?
• How important is leaving an inheritance?

These questions change the conversation. The plan comes first. The product comes second.

There are several ways to prepare for the storm

There isn't one long-term care strategy that will work for everyone. Generally, families have at least a few options, including:

1. Self-funding

Some people have accumulated enough wealth to comfortably pay for care from their own assets, and that's a perfectly legitimate strategy.

But self-funding should be a strategy, not an assumption. It should include modeling what happens if one spouse requires significant care for several years.

• From where would the money come?
• Which assets would be tapped?
• What happens to the surviving spouse's income?
• Does the rest of the retirement plan still work?

2. Traditional long-term care insurance

Traditional long-term care insurance allows someone to transfer a portion of the risk to an insurance company. In the right situation, it can provide significant leverage and help protect other retirement assets.

But the tradeoffs include ongoing (usually high) premiums and the possibility of premium increases, not to mention the discomfort some people have with paying for something they might never use.

3. Hybrid or asset-based strategies

Another option is a hybrid or asset-based strategy — usually a life insurance policy or annuity that includes long-term care benefits.

The money that goes into this strategy can serve multiple purposes. If long-term care is needed, those benefits are available. If it isn't needed, the death benefit or other value remains.

This can make the decision more acceptable for someone who dislikes the idea of "use it or lose it" insurance.

4. Combining strategies

Planning doesn't have to be all or nothing.

A family might choose to insure against part of the risk while retaining enough assets to cover the rest.

That's often how we handle other risks in life. We decide how much risk we're comfortable shouldering and how much we want to transfer to auto, home, health or other insurance policies.

Doing nothing is still a decision

You could decide to do nothing and figure it out as you go. That's the long-term care strategy many families have by default.

Maybe a spouse provides the care. Maybe the children step in. Maybe assets are spent down. Eventually, Medicaid might become part of the conversation for some families.

But there's an important distinction between intentionally choosing to retain a risk and ignoring it: The default plan might give you fewer choices when you need choices the most.

Plan while the sky is still clear

Having a strategy in place can help you feel more prepared and might reduce the urge to constantly watch the sky.

That's one of the primary goals of a good retirement plan: It can help provide confidence in the face of uncertainty.

Planning earlier might give you time to evaluate your financial resources, your family situation and the various ways you could handle the risk.

You don't necessarily have to purchase something. But you should have the conversation.

The appearances in Kiplinger were obtained through a PR program. The columnist received assistance from a public relations firm in preparing this piece for submission to Kiplinger.com. Kiplinger was not compensated in any way.

Related Content

• How to Pay for Long-Term Care
• Long-Term Care Insurance: 10 Things You Should Know
• What You Need to Know About Long-Term Care Before You Need It
• A Financial Professional's Take on Long-Term Care Insurance: Buy or Not?
• If Not Long-Term Care Insurance, Then What?

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

The main equity indexes slumped again on Friday, as semiconductor stocks sold off for a ninth straight trading session. Federal Reserve Chair Kevin Warsh shed only a little light on the central bank's upcoming decision on interest rates at an event in Asia. But he did heap a lot of praise on the potential upside for the broader economy from the artificial intelligence (AI) boom.

Still, CoreWeave (CRWV, -11.9%) remains a focal point, as investors, traders and speculators fixate on capex spending and whether what we're seeing instead is an AI bubble.

The VanEck Semiconductor ETF (SMH, -3.4%) extended its two-week losing streak, as Nvidia (NVDA, -1.4%) rallied into the green around noon but slumped after midday. Tech stocks, as well as AI stocks, generally dragged on the main equity indexes.

By the closing bell, the blue-chip Dow Jones Industrial Average, reversing early gains supported by rotation into energy and risk-off sectors such as consumer staples stocks, was down 0.3% to 52,002. Papa Dow held on for a 0.7% gain this week.

The broader S&P 500 slid 1.1% to 7,659, extending its weekly loss to 1.9%. And the Nasdaq Composite shed 2.1% to 26,140, as the tech-heavy index fell 4.5% from where it was last Friday.

The 2-year Treasury yield was down 3.0 basis points to 4.721%, as the short-term proxy for monetary policy traded in a wide range. Yields on the 10-year (+0.2 bps, 5.089%) and the 30-year (+0.7 bps, 5.435%) also moved up and down a lot on Friday.

'One Night in Bangkok' featuring Fed head Kevin Warsh

Warsh said little about the target range for the federal funds rate during an overnight "fireside chat" at the International Monetary Fund and World Bank Group annual meeting in Bangkok, Thailand.

While he was talking, though, equity index futures bounced to session highs, bond yields backed off a little more and the probability the Federal Open Market Committee (FOMC) will keep its policy rate unchanged at its late October meeting ticked up to 85.1% from 72.3% on Thursday.

That's according to CME FedWatch, which tracks price action in the 30-day fed funds futures market.

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"We removed a dose of accommodation about a month ago," Warsh said, referring to the 25-basis-point cut at the September Fed meeting. "I don't prejudge meetings. I don't believe in saying now what I might do at the meetings we have in the balance of the year."

Warsh also called AI "probably the most consequential change to the U.S. and the global economy in my lifetime. If you're a central banker and you're in the business of trying to ensure stable prices and full employment, you've got to recognize this as a shock."

Indeed, according to the Fed chair, AI will "fundamentally change the conduct of monetary policy."

With the official "blackout period" around its next policy decision starting tomorrow, that's the last we'll hear from the Fed until the conclusion of the next FOMC meeting on Wednesday, October 28.

Netflix needs a hit

Netflix (NFLX, -2.9%) announced its biggest layoffs since 2022 earlier this week, but naming a new chief content officer is probably a more important potential long-term catalyst for the communication services stock.

With NFLX down more than 15% year to date through Thursday, management is scheduled to report third-quarter results after the closing bell on Tuesday.

The stock has stagnated because of stale content that's left it struggling for engagement in an extremely competitive environment.

Co-CEOs Greg Peters and Ted Sarandos said in an internal memo that Netflix will be "disciplined about where we prioritize our people and resources" and focus on "high impact areas to improve our service."

For investors, that probably means a credible plan from the new management team to recapture eyeballs.

Flying car stock falls 2%

It's not the percentage part. It's the fact that the Magnificent 7 stock was down at all on the day Tesla (TSLA, -2.1%) introduced its Roadster, arguably the world's first flying car.

Say what you will about CEO Elon Musk and the grandiosity of his SpaceX (SPCX, -1.7%) project. This is the world's first flying car, people. "The Jetsons!" Right?

Well, actually, it's one thing to build a mind-blowing flying car, but another to introduce it when investors and traders, even speculators and policymakers, are focused on exploding capex and hyperscaler impact on the bond market.

Indeed, as Fed Chair Warsh acknowledged today, AI will boost central banks' ability to analyze data. It will also change the real economy, improve productivity and wealth.

At the same time, he cautioned, it's going to be a bumpy ride.

Related content

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• What to Look Out for in Economic Data Next Week
• What the Midterms Mean for Your Stock Portfolio

How does an ordinary investor find a true professional financial planner when it can be like searching for a needle in a haystack?

The financial services industry includes hundreds of thousands of individuals who use titles such as financial advisor, wealth manager, financial consultant, retirement specialist or financial planner. Yet these professionals operate under very different business models, compensation structures and standards of care.

Over the years, I've developed three criteria that I believe help consumers identify a true financial planning professional:

1. Professional training and competency, often demonstrated through credentials such as the CERTIFIED FINANCIAL PLANNER™ certification.

2. A fiduciary relationship, where the advisor is legally obligated to place the client's interests ahead of their own.

3. Fee-only compensation, meaning the advisor is compensated only by the client and doesn't receive commissions or other sales-related compensation from financial product providers.

Financial advisers who are members of the Garrett Planning Network (GPN) are required to meet all three criteria. But they must also agree to one more, unique requirement.

Unlike many firms that require ongoing wealth management relationships, Garrett members must make financial advice available regardless of income, net worth or asset level. They must also offer time-based services, such as hourly planning or project-based engagements.

That may be the organization's superpower.

I spoke to Jean Keener, CFP®, founder of Keener Financial Planning in Keller, Texas and a long-time Garrett Planning Network member, to find out more.

The accessibility problem

One of the biggest challenges facing consumers today is simply gaining access to objective financial advice.

Many advisory firms establish minimum account sizes of $500,000, $1 million, $2 million or more. While those firms may provide excellent service, their business models can leave many Americans without access to professional financial planning advice.

According to Keener, when consumers attempt to seek help, they often encounter something very different from what they expected: "People maybe try to get some advice, but they end up getting a sales pitch instead.

"When people are looking for objective advice and the only solution that's available to them is a sales relationship, that's not what they're even looking for."

This distinction is important.

Consumers are often searching for advice. What they find instead is a product recommendation.

The Garrett difference

The Garrett Planning Network was built differently, Keener says: "I felt like it solved that problem of, 'how do we create a model that people can get the objective advice they're looking for without a sales pitch?'"

It allows consumers to seek professional advice without worrying whether they will meet a firm's minimum account requirements.

The practical impact of this policy cannot be overstated.

• A young physician beginning a residency
• A newly married couple saving for their first home
• A recently divorced individual
• A mid-career professional evaluating their stock options
• A retiree trying to make Social Security and Medicare decisions

All these individuals can benefit from professional financial planning advice, even if they don't have substantial investment assets.

Advice when you need it

One of the most interesting parts of my conversation with Keener involved the concept of comprehensive financial planning.

She described comprehensive planning as taking a holistic view of an individual's financial life, including investments, taxes, insurance, estate planning, retirement planning, cash flow, debt management and other financial decisions.

But she also emphasized that consumers don't always need a traditional comprehensive financial plan. Sometimes they simply need objective guidance on a specific issue.

That flexibility is particularly valuable for younger investors with modest assets. Keener said: "[A] 25-year-old doesn't need comprehensive financial planning the way our industry has defined it, but [they do] need holistic financial advice."

In other words, consumers should be able to access the advice they need today without waiting until they accumulate significant wealth.

Finding the needle in the haystack

The more financial planners I interview, the more convinced I become that true financial planning professionals represent a relatively small segment of the broader financial advice marketplace.

Many people who call themselves financial planners are primarily engaged in selling investment products, insurance products or investment management services.

By contrast, professional financial planners focus on providing advice.

That's why I continue to believe that three characteristics matter most:

• Professional training and competency
• Fiduciary responsibility
• Fee-only compensation

The Garrett Planning Network combines all three of those characteristics while also adding a fourth requirement that may be uniquely valuable to consumers: Accessibility.

Its members agree to make financial advice available regardless of a person's income, assets or net worth.

That commitment helps consumers find what can otherwise be a needle in a haystack: A professionally trained, fee-only financial planner who is willing to help them before they become wealthy.

How to find a Garrett planner

Consumers who are interested in working with a Garrett Planning Network member can begin by visiting the Garrett Planning Network's online advisor directory. The directory allows investors to search for fee-only financial planners who have agreed to the organization's membership standards, including providing advice without minimum income, asset or net-worth requirements and offering time-based planning services.

Before engaging an advisor, investors should review their credentials, regulatory filings, areas of specialization, compensation model and service offerings to determine whether they're a good fit for their personal financial situation.

The bottom line

When I asked Keener what continues to attract her to the Garrett Planning Network after nearly two decades of membership, her answer reflected the organization's mission.

She said Garrett members are committed to making objective financial advice available to a broader segment of the American public and helping consumers obtain the advice they need when they need it.

For investors searching for objective financial guidance, that commitment may be the organization's greatest strength.

In a marketplace crowded with salespeople, the Garrett Planning Network helps consumers find something increasingly rare: A professionally trained financial planner who combines fee-only compensation, fiduciary responsibility and a commitment to making financial advice accessible to everyone — not just the wealthy.

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• Why a 'Fee-Based' DST Investing Sales Pitch Is a Red Flag for Investors
• 5 Do's and Don'ts for a Successful First Meeting With Your Financial Adviser
• Will a Financial Professional Always Act in Your Best Interests? 1 Question Will Tell You — and It's Not 'Are You a Fiduciary?'
• Complete Transparency and a 'Heart for Service': How Fee-Only Financial Professionals Put Clients First
• Revenue Sharing Is Great for Financial Pros — For You, Not So Much. How Can You Avoid This Sneaky Sales Incentive?

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Advisers spend a lot of time thinking about where their next client will come from. It's an important question. But I think there's another one worth asking: Have you earned the opportunity to manage the next dollar your existing clients invest?

For many advisory firms, organic growth is synonymous with new-client acquisition. More referrals. More prospects. More households.

Those things matter. But they're only one form of organic growth.

Consider a longtime client whose retirement accounts you manage, but whose 401(k) remains elsewhere. Or a couple where you manage one spouse's assets but not the other's. Maybe there's concentrated stock, an inheritance, assets from a former employer or money earmarked for the next generation.

Those aren't simply "held-away assets." They represent financial decisions happening in the lives of people who already trust you.

The question isn't how to capture those assets. It's whether you've earned the right to help with them.

Retention is the floor, not the ceiling

We often talk about asset management as a retention strategy. And it absolutely is.

When portfolios are thoughtfully constructed, monitored and adjusted as clients' lives change, advisers create an important foundation for long-term relationships. But simply retaining what you already manage shouldn't be the only measure of a healthy client relationship.

The strongest relationships tend to deepen over time.

A client changes jobs and needs to decide what to do with an old 401(k). A parent passes away and leaves an inheritance. A business is sold. A spouse retires. Stock compensation becomes a larger portion of the family's wealth. Parents begin thinking seriously about what they want to leave their children.

Each event creates another financial decision.

And every one presents an opportunity for the adviser to become more relevant to the client's financial life.

That doesn't happen because an adviser asks for more assets. It happens because the client has developed confidence that when the next decision arrives, their adviser is someone they want involved.

That distinction matters.

Start with curiosity, not consolidation

There's a phrase we use frequently in wealth management: "Share of wallet."

I understand why. From a business perspective, knowing how much of a client's investable wealth you manage can be an important measure of the depth of the relationship.

But I don't think advisers should approach clients thinking, "How do I get the assets they have somewhere else?"

A better question is: "Why are those assets there?"

Maybe the answer is inertia. Maybe no one has ever asked. But there could also be a perfectly good reason.

A 401(k) may offer attractive benefits. A concentrated stock position may require a careful tax strategy. Assets might be connected to a family relationship or another adviser. Or the client may simply not understand how those accounts fit with the rest of their financial picture.

The adviser's job is to understand before trying to solve. That kind of curiosity changes the conversation from an asset-gathering exercise into advice.

Instead of asking a client to move an account, you're asking whether their financial life is working together the way it should.

Sometimes the right recommendation will be to consolidate. Sometimes it won't.

Either way, you've demonstrated something valuable: Your first priority is helping the client make the right decision, not simply increasing the assets you manage.

That's how trust compounds.

Asset management can be the beginning of the conversation

For decades, investment management was often at the center of an adviser's value proposition.

Today, I increasingly see it as the foundation for a much broader conversation.

A portfolio can reveal questions about taxes. Concentrated positions can lead to conversations about risk. Required income can open broader retirement planning discussions. Appreciated assets can lead to charitable planning. An inheritance can prompt conversations about legacy planning and the next generation.

The investment portfolio isn't separate from a client's life. It's connected to nearly every important financial decision they make.

The opportunity for advisers is to use what they learn through managing assets to ask better questions.

• What has changed?
• What are we not planning for yet?
• What assets or decisions are we not discussing?
• Who else in your family should be part of this conversation?

Those questions can uncover needs that have little to do with beating a benchmark and everything to do with becoming more useful to the client.

Look beyond household count

There's another implication for advisory firms. We tend to measure growth through assets, revenue and new households. Those are all important metrics. But they don't necessarily tell you how deeply you're serving the clients you already have.

Imagine two advisers.

One adds 20 new households during the year but sees little additional growth within existing relationships.

Another adds five new households but becomes the primary adviser for more of her existing clients' financial lives. She helps with retirement assets she previously didn't manage, begins working with spouses she had rarely engaged with, develops relationships with clients' adult children and is brought into more significant financial decisions.

Which practice grew more successfully?

The answer may not be obvious from household count alone.

That's why I think advisers should pay attention not only to how many relationships they have, but to the depth of those relationships.

• Are clients consolidating more of their financial lives with you over time?
• Are you being brought into more decisions?
• Are you developing relationships with spouses and the next generation?
• When something changes in a client's life, are you one of the first calls they make?

Those can be powerful indicators of the health — and future growth potential — of an advisory business.

Earn the next dollar

None of this means advisers should stop pursuing new clients. Healthy firms need new relationships, and great client experiences should naturally generate referrals.

But client acquisition can be expensive and time-consuming. Before assuming the next stage of growth has to come entirely from people you haven't met yet, it's worth looking carefully at the relationships you've already earned.

• There may be retirement accounts you don't manage
• There may be spouses you don't know well enough
• There may be children who will someday inherit substantial wealth but don't yet view you as their adviser

And there are almost certainly financial decisions your clients haven't brought to you because they don't yet realize you can help.

The goal isn't to find a clever way to capture those assets.

It's to build the kind of relationship that makes clients want you involved.

The strongest organic growth doesn't always begin with a prospect. Sometimes it begins with a client you've served for years who faces another important financial decision and decides you're the person they trust to help make it.

So advisers should absolutely keep asking where their next client will come from.

But I'd encourage them to ask another question, too: Have I earned the right to manage the next dollar?

Because some of the most sustainable growth isn't simply acquired. It's earned.

Related Content

• From 'My Adviser Is Great' to a Great Story: This Is How Advisers Can Turn Value Into Referrals
• Your Clients Have Changed: Has Your Advisory Practice Changed with Them?
• Addressing Your Clients' Emotional Side: Communication Techniques for Financial Advisers
• Winning Strategies for Financial Advisers as Clients' Lives Evolve
• Optimize, Grow, Retain: The Power of Annual Client Reviews

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Editor's note: This is the second article in a two-part series on how advisors can help clients move from reactive decision-making to intentional retirement planning. Part one is Are Your Client's Retirement Income Withdrawals Out of Whack? How to Help Them Get the Sequence Right.

Taxes are one of the most overlooked risks in retirement planning. The goal isn't simply to reduce taxes this year — it's to manage them across your lifetime while maintaining consistent, reliable income. This is where professional advice becomes critical.

At Wealthcare Advisors (WCA), this is what we believe an advisor's process should include.

Proactive planning before RMDs kick in

The years between retirement and age 73 (when required minimum distributions (RMDs) typically begin under current law) can be a window of opportunity. During that time, strategies may include gradually repositioning assets, managing taxable income levels and exploring Roth conversion opportunities while tax brackets are more favorable.

These three strategies should be at the top of your pre-call meeting with your team before the client discussion.

Social Security claiming decisions

Deciding when to start claiming Social Security impacts more than just the client's benefit. It affects:

• Their overall income structure and cash flow
• Taxation of benefits
• Longevity of their portfolio

Coordinating Social Security claiming with the withdrawal strategy you've developed helps create a more balanced and efficient income plan.

Adjusting for legislative changes

Tax laws change — and planning opportunities change with them. Taking advantage of provisions while they're still in place can create meaningful long-term benefits.

At WCA, an initiative-taking approach allows us to adapt strategies before the rules shift, rather than reacting afterward. And as specific provisions evolve, so do WCA strategies, meaning they're always tailored to current law at the time of planning.

Coordinating income for consistency and efficiency

Rather than pulling income from a sole source, we help design a blended withdrawal approach that:

• Maintains predictable income
• Reduces unnecessary tax spikes
• Positions assets efficiently for the future

It is not just about minimizing taxes — it is about integrating taxes into the larger income plan.

The '3L framework'

As you collaborate with clients approaching retirement, you can use WCA's "3L framework" to move them from reactive decision-making to intentional planning.

Start with what they will "lean on" — guaranteed or reliable income sources, such as Social Security, pensions and structured income streams. This is where thoughtful Social Security claiming strategies and coordination with other income sources can establish stability.

From there, guide them toward what they will "live on" — their portfolio distributions. This is where sequencing withdrawals, adapting to market conditions and proactively managing taxes before RMDs take effect all come into play. Helping clients understand not just which accounts to draw from, but why and when, positions you as a strategic partner rather than a transactional advisor.

Finally, anchor the conversation around what they will "leave behind," which naturally brings tax efficiency and long-term legacy planning into focus. This is where proactive planning — such as taking advantage of current tax provisions while they remain intact and managing lifetime tax exposure — can have a meaningful impact on legacy outcomes.

By framing these decisions within the "3L" structure, you're not answering your client's questions in isolation — you're delivering a coordinated strategy.

More importantly, you are helping clients replace a "ready, shoot, aim" mindset with clarity, confidence and a disciplined process that connects every decision back to their broader retirement objectives.

From reactive decisions to intentional retirement

The biggest mistake pre-retirees make isn't lack of preparation — it's assuming the hard part is over once they've saved enough. Distribution planning is just as important as accumulation.

With your help and before they set their retirement date, take the time to collaborate closely with your clients to explain which accounts will fund their lifestyle — and why. Explain how your joint plan will adapt to changing markets, and how taxes will be managed — not just this year, but over decades.

When your client and your team approach retirement with those answers in place, everything changes. Decisions become clearer. Income becomes more predictable. Confidence replaces uncertainty.

Why? Because your client's retirement should not start with "ready, shoot, aim." It should start with a plan.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Price action in the fixed-income market suggested bonds are in the process of finding a bottom, even as incoming data indicated inflation remains a problem. At the same time, during yet another difficult day for technology, the three main stock indexes rallied for modest gains on Wednesday.

By the closing bell, the blue-chip Dow Jones Industrial Average had added 1.1% to 52,177, the broad-based S&P 500 was up 0.3% at 7,744, and the tech-heavy Nasdaq Composite had rallied for a 0.08% gain to 26,713.

"As horrific as the PPI was," Louis Navellier of Navellier & Associates says, "believe it or not, Treasury yields actually declined on the perception that this may be the peak in the poor inflation news."

Indeed, the 2-year Treasury yield was down 4.5 basis points to 4.757%, while the 10-year (-9.9 bps, 5.091%) and the 30-year (-9.3 bps, 5.431%) pulled back even further.

As Navellier notes, Taiwan Semiconductor Manufacturing (TSM, -1,7%) reported 51% top-line growth and 59% bottom-line growth for its third quarter. Management also raised its full-year guidance.

Still, Nvidia (NVDA, -1.8%) was down again, as was the VanEck Semiconductor ETF (SMH, -1.0%) — the exchange-traded fund's eighth straight loss.

"A lot of market pundits think that stocks are priced for perfection," Navellier writes, "but I remain confident that when the third-quarter announcement season winds down, the S&P 500's earnings will be up at least 33%."

The Fed has 'work to do'

The Bureau of Labor Statistics (BLS) said before the opening bell that the Producer Price Index (PPI) rose by 1.3% in September, more than double a FactSet-compiled consensus forecast for 0.5% month-over-month acceleration. PPI was up to 6.3% from 5.6% compared to September 2025.

"PPI inflation was higher than expected in September as energy prices surged and food prices rose," Fifth Third Commercial Bank Chief U.S. Economist Bill Adams observes. "Core inflation exceeded forecasts, too."

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A red-hot September CPI report and today's PPI data "show no sign of inflation moving back to the Fed's target," Adams concludes, "leaving the central bank with 'more work to do,' to borrow Chair Warsh's phrase from his Jackson Hole speech in August."

Nike tops the Dow

Nike (NKE, +5.3%) is now the smallest of the Dow Jones stocks, and it's the worst performer of the 30 so far this year. But that didn't stop the sneaker company from leading the index on Thursday.

NKE was down 78.2% from an all-time closing high of $161.91 on November 5, 2021, to $35.30 at the end of regular trading on Wednesday, presenting what looks like a bargain to many investors, traders and speculators.

Indeed, the iconic athleisure brand has bounced off an intraday low of $31.97, plumbed on October 2 in the aftermath of a less-than-stellar fiscal 2027 first-quarter earnings report.

Perhaps what was once the consummate consumer discretionary stock will find its way to lists of the best value stocks to buy, perhaps not.

Wall Street remains skeptical about Nike's turnaround, with 10 analysts rating the stock a Buy, 25 calling it a Hold and seven saying it's a Sell. The average 12-month target price is $37.88, upside of 1.9% from NKE's closing price on Thursday.

Why we need to talk about CoreWeave

CoreWeave (CRWV, +5.9%), which completed one of the biggest IPOs of 2025 on the back of its AI cloud platform, has become the focal point for broad market concern about the health of the current industrial revolution.

CRWV has fallen about 64% from its June 20, 2025, all-time high, as questions about returns on the capex fueling the boom have mounted amid rising debt, spiking bond yields and growing perception of the risks of an AI bubble.

But Deutsche Bank analyst Brad Zelnick reiterated his Buy rating and his $150 12-month target price for the tech stock on Thursday and said recent price action presents an opportunity.

"A confluence of factors appear to have led to a sharp selloff in CoreWeave's public equity and debt over the past week," Zelnick writes. "There's no doubt CoreWeave's future is tied to the success of AI and demand for the underlying compute infrastructure supporting it, and thus its shares should reflect changes in sentiment here."

CRWV gapped down at Thursday's open, but rallied through the session to post a solid gain. "A strong customer base, established record of execution, backlog conversion and leading infrastructure performance is all supportive of their issuer profile relative to neocloud peers," Zelnick concludes.

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I talk to a lot of 65-year-olds, and one of the biggest fears they have is making a mistake with Medicare. It's hard not to be afraid when you keep hearing well-intentioned, but conflicting advice such as:

• "You have to sign up for Medicare at 65."
• "You don't have to sign up for Medicare at 65."
• "You can change your Medicare insurance every year."

During my 20-plus years as a retirement-focused financial adviser, I've just about heard it all — some true, some false and just about all of it leaving near-65-year-olds wondering how they can figure it out in time.

Below are the five most common mistakes retirees make with Medicare and what you can do to try to avoid them.

What makes Medicare so different

Your health insurance choices used to be easy. Your work gave you two or three options and you chose the one that fit your family best.

Then you turn 64 and you get bombarded with advertisements in the mail touting how great a particular Medicare insurance plan is.

When I checked Medicare.gov's Plan Comparison Tool in September 2026, there were 81 different options near me in Wisconsin: 39 Medicare Advantage plans, 10 prescription drug plans and 32 supplement insurance (Medigap) options.

The number and types of plans available to you will depend on where you live.

With so much information and so many different plans, it's no wonder Americans keep making these five common mistakes.

Mistake No. 1: Assuming Medicare is automatic

Medicare feels automatic since many people enroll or get signed up for it at 65, but that feeling of "automatic" often turns into "I don't have to think about it" — and that's a big mistake.

Medicare enrollment generally is automatic if you've already been receiving Social Security retirement benefits for at least the four months before age 65. A few months before your 65th birthday, you'll get your Medicare card in the mail showing that you're enrolled for Part A and B.

If you have current employer-provided health insurance from a company with 20-plus employees, you may be able to delay starting Part B. Before you do, check with your employer to find out how your health coverage coordinates with Medicare.

If you're signed up for Part A and B automatically, that doesn't mean you automatically get signed up for other private Medicare insurance to pay for the gap between what Medicare covers and what Medicare pays.

You should still evaluate whether you're better off with Medicare Advantage or original Medicare with Medigap (supplemental) insurance — and you'll have to proactively sign up to get those coverages.

Mistake No. 2: Misunderstanding what counts as 'employer coverage'

Many people turning 65 think, "I don't need to sign up for Medicare. I already have insurance through my employer." It turns out they actually have retiree coverage, COBRA or even TRICARE from prior military service.

Retiree health insurance and COBRA plans are not coverage from your current employer. And TRICARE states that you need Part A and B to get TRICARE For Life.

If you have employer-provided health insurance based on your or your spouse's current employment with a company of 20-plus employees, you may be able to delay signing up for Medicare. That's true, and yet there's so much confusion around that.

Your "employer coverage" must be from active, current employment.

Retiree healthcare doesn't count as current employer coverage that could allow you to delay Part B. COBRA generally doesn't count either.

TRICARE states, "If you're eligible for both TRICARE and Medicare Part A, then in most cases, you must have Medicare Part B to keep TRICARE." (Emphasis added.)

Mistake No. 3: Confusing the different Medicare parts and choices

Medicare lists four different parts of Medicare, along with optional Medigap insurance, and points out the differences between Medicare and Medicaid. With similar names and so many parts, no wonder it's confusing.

Medicare Part A (hospital insurance) covers inpatient care in hospitals, skilled nursing facility care, hospice care and home healthcare.

Most people get Part A with no premium cost because they, or their spouse, qualified by working and paying Medicare payroll taxes for "40 quarters" — basically 10 years. Premium-free doesn't mean cost-free though. You can still have deductibles, copays and other out-of-pocket costs.

Medicare Part B (medical insurance) helps pay for doctor visits, outpatient care and preventive care, such as screenings, shots or vaccines, and yearly "wellness" visits.

Part B costs $202.90 a month, which is often a surprise to many retirees who think it's free. It can cost even more if you have a high enough income and must pay Income-Related Monthly Adjustment Amount (IRMAA) surcharges.

Medicare Part D helps cover the cost of prescription drugs.

Drug coverage is often part of a Medicare Advantage plan. But if you choose a Medicare Supplemental Insurance (Medigap) plan, you'll generally buy part D drug coverage separately, unless you have other creditable drug coverage.

Medicare Supplement Insurance (Medigap) helps you pay your share of the costs of original Medicare.

People often ask me, "What does Medicare Supplement cover?"

My answer is, "Medicare Supplement generally covers what Medicare covers, but it generally pays for many of the costs that Medicare makes you responsible for."

Medicare Part A has deductibles, coinsurance and copays that you are responsible for.

Medicare Part B has a deductible, after which you generally pay for 20% of the cost of the Medicare-approved amount for services Medicare covers.

That's where Medicare Supplement (Medigap) comes in, to help pay the costs of your healthcare that Medicare covers but doesn't fully pay. You could also choose a different route, called Medicare Advantage.

Medicare Advantage (also known as Part C) is an alternative to original Medicare. You get a "bundled" plan through a private insurance company that is Medicare approved and essentially brings your Part A, Part B and usually Part D coverages all together.

Many Medicare Advantage plans have low or even $0 monthly plan premiums, while Medigap policies generally charge a separate monthly premium.

However, those on Medicare Advantage generally must continue paying their Part B premium, along with deductibles, copayments and specific provider networks.

Mistake No. 4: Ignoring the potential extra costs of Medicare through IRMAA

Many people are surprised that Medicare Part B has a monthly premium. They expect the taxes they paid throughout their career to cover their Medicare in retirement.

What's even more surprising is when your income from two years ago causes you to pay extra for Medicare through the IRMAA.

I met a client recently who was upset that his Medicare premiums were higher this year than last year.

I discovered he had retired two years ago. His income from that year was high enough to go over the IRMAA threshold so that both his and his wife's Medicare premium was roughly double the normal amount.

Fortunately, you can appeal your extra Medicare costs through IRMAA, and "work stoppage" is one of the "life-changing" events Social Security will take into account.

My client had retired, and his income is now lower. So after the couple requested a new IRMAA determination based on his retirement and their reduced income, their combined Medicare premiums were reduced by roughly $5,000 for that year.

This client's IRMAA surcharge highlights how interconnected all the pieces of retirement are. Your added income in one year, from working or perhaps Roth conversions or stock sales, can affect your healthcare costs two years later.

Retirement isn't just about your Medicare decision and your investment decision, and your Social Security decision separately. It's about how each of these areas affect each other.

That's why I created a five-step retirement master plan to help all the pieces of retirement fit together, which you can find in my book Retire Today.

Mistake No. 5: Not re-evaluating your Medicare Advantage or drug plan each year

Each year during open enrollment from October 15 through December 7, I send a message to my clients encouraging them to review their Medicare Advantage or prescription drug plan for the following year.

By far, the most common response is, "Nothing changed for me this year, so I don't need to do this."

But here's the thing: Something may have easily changed. Your existing plan could have changed quite a bit.

Every year, your Medicare Advantage or Part D drug plan can change its cost, its network, its preferred pharmacy, its benefits, its provider list.

And even if your plan doesn't change one thing, all the other plans could change and you might be missing out on a better plan for you.

You may find another plan that better fits your healthcare needs, or your prescription drugs, providers and budget.

Whether you're on Medicare already, or getting ready for Medicare, follow these five steps to avoid big Medicare mistakes:

• File for Medicare at the right time
• Confirm how your current health insurance coordinates with Medicare
• Learn the different parts of Medicare and what they cover
• Understand how past income affects current Medicare costs — and whether you qualify for a reduction in those costs
• Re-evaluate your Medicare Advantage and drug plan options each year

Take these five steps before, and even after, you file for Medicare, and you'll feel much more confident in the Medicare decisions you make.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Bonds are suffering a rough spell, but this is not 2022, when fixed-income investments disgorged more than 10%. Even after several losing weeks, and despite palpable pessimism about whether the Federal Reserve and U.S. Treasury have answers to the darkening inflation picture, the Bloomberg U.S. Aggregate Bond Index is off less than 1% for the year through August.

Uncle Sam is now paying its highest interest rates on long-term debt in roughly 20 years, but the trading action in Treasuries is more drip-drip-drip than a rush to the exits. When bond opportunities arise, there are buyers. Alphabet (GOOGL) set off a stampede when it issued new debt at 4.875% for five years and 5.45% for 10.

However, medium-term and long-term fixed-rate investments have massive competition. Cash and ultra-short bonds pay 4%. Then come the newfangled and alternative ways to collect 5% and up: funds of variable-rate loans, options-driven income exchange-traded funds, high-rate credit and more.

Back in the day, those were unknown, inaccessible to small investors or cost a fortune in fees and commissions. Now, says Bill Merz, the head of capital markets research for U.S. Bank, alternatives and floaters are serious rivals to traditional bond markets and a factor in forcing yields higher, alongside inflation, the Treasury's mounting debt and a lack of confidence in the government's plans and performance.

Bond owners have three motivations: income, diversification and capital preservation. As higher rates gnaw away at principal, it is sensible to review how best to serve each of these aims. I don't advocate a total portfolio teardown. Municipals are in the green in 2026 and are keepers if your tax situation makes the numbers work.

High-yield bonds continue to outperform investment-grade corporate and government debt. But when you can get 4% with no risk, or much more with only a little risk, it pays to look around.

Where to find income

The Fed raised short-term rates in September and is likely to raise again by the end of the year. This means variable-rate credit tied to the Fed will churn out more cash.

Funds including Fidelity Floating Rate Income (FFRHX), Janus Henderson AAA CLO ETF (JAAA) or PGIM AAA CLO (PAAA), and WisdomTree Floating Rate Treasury Fund (USFR) are outpaying and outgaining most bond funds, with high yields and year-to-date total returns of 4% and above — and that is before any rate hikes.

Use options-powered ETFs to diversify your portfolio

Unlike past economic cycles, long-term bonds and stocks are moving in the same direction. So, for insurance against a stock market correction or prolonged bond rout, it is logical to pursue high cash distributions that can offset price declines.

This explains the appeal and success of options-powered ETFs, such as Calamos US Equity Autocallable Income (CAIE) and two from Global X: NASDAQ 100 Covered Call (QYLD) and S&P 500 Covered Call (XYLD).

I would ignore the flaw that the options limit the growth from rising share prices and instead consider these to be high-yield income sources, not part of a stock allocation. I grant that these are complex. But they are paying out roughly 10% and more, and without interruption.

The best way to preserve capital

The surest way to guarantee that your savings stay intact is to lock them away. As the Fed tightens, money market funds and short-term certificates of deposit (CDs) will pay 0.25 or 0.50 percentage point more.

And inflation is not so high that cash is trash. Or, with individual bonds, as opposed to funds, you can hold to maturity and ignore fluctuating bond indexes.

Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.

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AI became a larger part of our ordinary lives quickly.

We already had AI assistants like Amazon's Alexa and Apple's Siri. And in March, Amazon added a health assistant to its website that can read your medical records and book your appointments.

In May, Schwab gave retail clients a tool that summarizes why their portfolio moved. The technology turns up in the search bar and the banking app whether you asked for it or not. Schwab includes a disclaimer on their AI tool saying the output, "should not be construed as investment advice or recommendations and are for informational and educational purposes only."

A general-purpose chatbot like ChatGPT or Claude includes no such disclaimer when someone asks whether to pull $60,000 out of an IRA for a new roof and to replace windows.

Yet, people keep asking. A July J.D. Power survey found that 40% of respondents had sought help from AI to manage their personal finances. In the same survey, 34% said AI helps them make smarter financial decisions, 1 percentage point behind the 35% who said that about their own bank.

A chatbot answers in the same confident tone whether it has the facts or not, and it doesn't flag what might be left out.

The chatbot doesn't know:

• Your marginal tax bracket
• Whether the money sits in a traditional IRA, a Roth or a taxable account with a low cost basis
• How your state treats the distribution
• That a two-year lookback on your income sets your Medicare premium
• That your income will drop in 18 months when you move to part time
• If you have carryforward losses to utilize

None of those details, which can sway the answer completely, enter the conversation unless you introduce them. The chatbot answers the question that is asked, not necessarily the ones that are exclusive to your situation.

Sixty thousand dollars out of a traditional IRA arrives as ordinary income, and if the rest of your income already sits near a tax line, that money can push the total past an IRMAA threshold that resurfaces as a higher Medicare premium two years later.

The same $60,000 from a taxable account with a high cost basis might barely register on your tax return.

None of those details require the chatbot to be wrong. It's answering a loaded question for the general reader without the specificity and complexity of your personal situation.

Where AI helps

AI makes a good study partner and can prepare you for more productive meetings with your adviser.

For example, researching and learning about qualified charitable deductions (QCDs) at home saves time that doesn't have to be spent on explanations.

Other ways it can help include:

Translating documents. Paste in the section of your summary plan description that governs in-service withdrawals or the paragraph of an annuity contract that lays out the surrender schedule, and ask the chatbot to explain it in plain language. Those documents get written for compliance review rather than for you, the reader. Delegate the explanation to the chatbot.

Build a question list before the meeting. Provide the chatbot with three sentences about your situation and request questions you should ask your adviser. This will create an agenda for an efficient and productive meeting.

Argue the other side. Ask it to make the strongest case against a recommendation you've already received, including mine. The objections it raises are worth bringing to the person who made the recommendation.

Ask it what it does not know. Some version of "what would you need to know about my situation to answer this well?" returns insightful questions to consider.

One note to keep in mind. Account numbers, Social Security numbers and full statements don't belong in a general-purpose chatbot. Round numbers and account types give the tool everything it needs to be useful.

What's next

Forty percent of consumers have already taken a money question to AI, and that number is likely rising. There are smart ways to use these tools. Moving money on an answer that never had your full picture is not one of them.

The tools will keep improving, and more people will walk into meetings with better questions because of them.

Take the response for what it is, which is a starting point. Reading it against your own numbers is where we come in.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Positioning your portfolio with the outcome of electoral politics in mind is a bad idea. So if you're planning on messing with your allocations ahead of November's midterm elections, you might want to think again.

For more than two decades, Barry Ritholtz, co-founder of Ritholtz Wealth Management, has urged folks to keep politics out of their investing process. His latest book, How Not to Invest, even has a chapter titled "Why Politics and Investing Don't Mix." Ritholtz stresses that politics is fundamentally emotional, while "investing is done best when it's logical and rational."

Besides, predictions about which sectors are set to outperform or lag are too often just plain wrong. Recall that ahead of President Donald Trump's first term, investors were advised to load up on Big Oil and small-cap stocks (wrong and wrong) and avoid Big Tech and renewable energy names (wrong and wrong, again).

Most importantly, stocks tend to do quite well at this point in the cycle, notes Jeffrey Buchbinder, chief equity strategist at LPL Financial.

"One of the strongest 12-month seasonal periods of the four-year presidential cycle for stocks is fast approaching," he writes. "The year following midterm elections has generated the strongest average annual S&P 500 return at 17.2%, significantly above returns during first-year, election-year and midterm-year periods."

And how. The S&P 500 has risen during the 12 months following midterm elections 18 straight times dating back to 1954, according to LPL.

"History suggests investors may be better served focusing on market behavior rather than political predictions," Buchbinder adds.

Ryan Detrick, chief market strategist at Carson Group, wholeheartedly concurs, noting that the best part of the four-year presidential cycle is now.

"The fourth quarter of a midterm year is historically the best quarter of the year, up more than 80% of the time and up 4.2% on average, twice the next best quarter," Detrick says.

Why gridlock could be good for equities

True, Democrats could flip the House of Representatives, but Detrick notes that gridlock can be good. A divided Congress is often positive for the stock market. After all, the status quo can be preferable to the uncertainty of sweeping legislative changes.

Even if you do want to handicap the election outcome, the polls suggest the market could be poised for a period of outperformance, says Monica Guerra, head of policy and geopolitical strategy at Morgan Stanley Wealth Management.

"Under a Republican president and split Congress, the S&P 500 has historically gained about 23% in the post-midterm year, compared with 12% across all midterm outcomes," she writes.

Who holds power in Washington, D.C., matters, of course, but not nearly as much as the outlook for corporate earnings, interest rates and the macroeconomic environment, experts say.

"Regarding political party control of Congress, other issues matter more to the market's medium- and long-term performance, including Fed policy and innovation," writes Kelly Bogdanova, portfolio analyst at RBC Wealth Management. "Despite the increasing likelihood that party control could shift partially or fully in the next Congress, RBC Capital Markets equity analysts see little overall impact on S&P 500 sectors."

How investors should prepare

The bottom line: Since 1945, U.S. stocks have climbed under both parties and across nearly every configuration of the legislative and executive branches, says Anthony Saglimbene, chief market strategist at Ameriprise Financial.

"Through it all, the long-term direction of the stock market has generally been higher," he writes. "Midterm election results have typically had a limited impact on the long-term performance of the broader market."

No matter which party is in control, staying focused on a long-term plan and maintaining a well-diversified portfolio has generally been the best approach, Saglimbene adds.

To reiterate the point, we'll give the last word to Michael Townsend, managing director of legislative and regulatory affairs at Charles Schwab.

"Given the political atmosphere in the United States right now, the 2026 midterm elections are likely to be particularly emotional," he says. "Investors should remember to keep those emotions in check when making investment decisions."

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With growing excitement around IPOs such as SpaceX and ongoing speculation about others, many investors are asking the same question: How can I get in on the action?

While chasing the newest investment opportunity might be tempting, building wealth rarely happens through one hot IPO, a trending stock or the latest market craze.

The most successful investors rarely get caught up in hype. They follow a disciplined process rather than searching for shortcuts.

The danger of chasing the hot, new investment

When investors hop on a highly anticipated company, early enthusiasm can push prices far beyond what the business is actually worth.

This can create that fear-of-missing-out (FOMO) feeling, as investors get in early and make money while others eagerly wait their turn.

But chasing hype can be risky. What looks like a quick win can just as quickly turn into a painful lesson once the initial excitement fades and the investment's true value becomes clearer.

A good example is Rivian. Many investors believed they were buying when the hype had settled, but even purchases that appeared to be on the dip resulted in significant losses as valuations continued to fall.

It often takes months or even years for the market to determine a company's true value.

Consistency is the name of the investing game

There's nothing wrong with wanting a piece of the pie when it comes to investing. The problem is when investors begin to view some of these opportunities as shortcuts to wealth.

Everyone is looking for the next big winner that will magically get them to retirement faster, but contrary to popular belief, wealth building isn't complicated.

I like to compare it with a new fad diet promising dramatic results. The people who are successful in losing weight or maintaining good health typically follow the same principles: Eat well, exercise consistently and stick to a routine.

The same is true about investing. Just as you can't junk-food your way to good health, you can't junk-invest your way to a secure retirement.

The three keys to long-term retirement success

Investors who build meaningful wealth focus on three things:

Consistent contributions. The most reliable way to build wealth is not by trying to guess which shiny new idea will take off next, but to consistently invest over time. Regular contributions allow investors to benefit from market ups and downs. Dollar-cost averaging removes the pressure of trying to time the market. They keep investing regardless of what the headlines say.

Time in the market. Successful investors give their money time to grow. Compound interest is one of the most powerful tools in investing, but it requires patience. Wealth accumulation can feel slow at first, but it accelerates over time. The earlier you start, the greater the potential payout.

Risk management. For your money to grow, it requires a certain level of exposure to growth assets. While market volatility can be tough to stomach at times, avoiding risk entirely can make it difficult to achieve the returns needed to meet long-term goals. Investors should take on as much risk as they can reasonably tolerate.

A good retirement strategy is not about hitting home runs. It's about creating a system that works over years and decades. That means saving consistently, staying invested and choosing the right mix of investments that fits your risk tolerance and time horizon.

When to dial back risk

Risk is largely based on your time horizon, or how far you are from retirement. If you're early in your career, your focus should remain largely growth-oriented. Major market swings have less of an impact when time is on your side.

If you're about 10 years from retirement, you should start taking a closer look at your future spending, retirement income needs and overall strategy.

If you're about five years from retirement, begin balancing growth opportunities with greater protection of the assets you've worked to accumulate.

This is the stage in life that we specialize in at Blue Ridge Wealth Planners. We help clients optimize their retirement by implementing strategies to help preserve their assets and generate lifelong income. The goal shifts from building wealth to preserving and distributing it effectively.

That doesn't mean abandoning growth entirely. It means making sure your portfolio aligns with your timeline and goals.

How to handle 'hot' investment opportunities

How should investors respond when a hot new opportunity dominates the headlines?

Ask yourself:

• Does this investment fit my overall plan?
• Am I investing because of the company's fundamentals or because everyone is talking about it?
• What happens if this investment loses significant value?

Start by reminding yourself what has always been true. Exciting investments will come and go. Some will succeed and some won't. Predicting which is which is often much harder than it appears.

If you're interested in a particular company or industry, there might be other ways to gain exposure through diversified investments, such as ETFs, rather than relying on a single company to carry your entire portfolio.

In the end: Trust the process

Don't let the pursuit of a shortcut distract you from the process that works. Building wealth is rarely exciting. It usually consists of saving consistently, investing wisely, managing risk appropriately and staying committed regardless of market conditions.

You don't need to find the next SpaceX to reach your financial goals. Trust the process and remain disciplined long enough for it to work.

Blue Ridge Wealth Planners is an investment adviser registered with the Securities and Exchange Commission. SEC registration is not an endorsement by the SEC nor does it imply a certain level of skill or training.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Treasury yields surged and equity indexes sank after the government said consumer prices rose last month at a faster clip than Wall Street forecast. Technology and other sectors closely connected to the artificial intelligence (AI) revolution reflected today's sharp risk-off turn, as healthcare, consumer staples and energy stocks caught bids.

The 2-year Treasury yield (+1.5 bps, 4.808%) spiked more than 10 basis points within minutes of the release of a red-hot September CPI report, but eased back through Wednesday's trading session. "On balance," Barclays economist Pooja Sriram writes, "this morning's inflation data are unlikely to provide much comfort to policymakers."

Sriram says risks economists "have flagged for some time, including energy pass​-​through into core prices, resilient consumer spending, and AI​-​related price pressures" are becoming bigger factors in the price stability equation.

As the economist concludes, "Although favorable base effects should mechanically lower annual inflation rates next year, the recent run of prints casts doubt on how much progress is being made on underlying inflation."

The 10-year Treasury yield (-2.7 bps, 5.19%) and the 30-year Treasury yield (-4.6 bps, 5.517%) were lower at the end of a volatile session in the bond market. CME FedWatch now shows a 34.9% probability of a 25-bps rate hike at the conclusion of the October 27-28 Federal Reserve meeting, up from 22.1% on Tuesday.

Investors, traders and speculators will turn their attention to the release of September's Producer Price Index (PPI) and retail sales data before Thursday's opening bell for the next clues on interest rates and monetary policy.

ASML sends a risk-off signal

By the closing bell, the Nasdaq Composite had taken a 1.9% tumble to 26,692, the tech-heavy index anchored by a seventh straight losing session for chipmakers on a mixed earnings calendar showing from one of the industry's overseas stalwarts.

The broad-based S&P 500 was down 1.1% to 7,719, and the blue-chip Dow Jones Industrial Average had slipped 0.09% to 51,622, as other groups boosted by the AI buildout reflected the macro mood.

Looking for more timely stock market news to help gauge the health of your portfolio? Sign up for Closing Bell, our free newsletter that's delivered straight to your inbox at the close of each trading day.

Netherlands-based ASML (ASML, -3.9%) reported a 47% increase in third-quarter revenue and 127% earnings growth, just missing on the top but easily beating on the bottom line. Management raised fourth-quarter sales guidance, too.

ASML also said it would struggle to meet demand for its chips in 2027 and 2028, indicating a healthy order backlog that should signal good things for semiconductor stocks.

Alas, Nvidia (NVDA, -3.2%) was among the worst Dow Jones stocks on Wednesday, joined by Caterpillar (CAT, -3.1%). The industrial stock is among those names, beyond tech and communication services stocks, benefiting from AI-driven demand.

Amid broader curiosity about the trajectory of the federal funds rate, markets seem wary of any and all kinds of open questions, even (perhaps especially) as they relate to growth expectations.

“Uncertainties around ASML's ability to ship DUV [deep ultraviolet lithography] tools to China remains a hot topic with investors," BofA Securities analyst Didier Scemama wrote ahead of ASML's report. "However, we think this is likely largely baked in the stock."

Scemama reiterated his Buy rating and his $2,915 12-month price target on ASML's American Depositary Receipt (ADR), which closed at $1,650 on Wednesday.

Bank of America pays up

Bank of America (BAC, -4.7%), because of a potential positive impact on net interest margin, is among the best stocks to buy for rising interest rates this fall.

The big bank also looks like a big bargain after BAC suffered its worst post-earnings share-price decline since the early aftermath of the global financial crisis more than a decade and a half ago.

As Jefferies analyst David Chiaverini notes, the Treasury Department announced a $1.2 billion fine on Bank of America for violations of anti-money laundering rules previously identified in a December 2024 consent order.

The fine resulted in a 17-cent-per-share hit to BAC's bottom line. But Chiaverini, who has a Buy rating on BAC and considers the financial stock a "Franchise Pick," now sees upside from here of about 36% based on his 12-month target price of $70.

"While the charge is a meaningful one-time hit," the analyst observes, "we believe remediation costs are largely embedded in the current expense base. The key debate is how long the consent order could be in place and the extent to which it could impede operations, if at all."

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A financial adviser can help you make sense of your finances, set realistic goals and develop a plan to achieve them. But a little preparation before your first meeting can help you get more out of the conversation.

Start by identifying your top three financial goals or concerns. Consider both your short- and long-term priorities, whether that's paying down debt, saving for a home or planning for retirement. Knowing what matters most to you will help the adviser understand your needs and recommend a path forward.

You don't need to have all the answers before your first meeting. The goal is to come prepared with a clear picture of your priorities and questions. This will help you make the most of your time and determine whether the adviser is the right fit for your financial needs.

Gather a snapshot of your finances

To help your financial adviser get a clear picture of your financial situation, gather a few key documents before your first meeting. These include:

• Recent pay stubs or other proof of income
• Most recent federal income tax return
• Current checking and savings account balances
• 401(k), IRA, pension and other retirement account statements
• Brokerage and other investment account statements
• Mortgage statements showing your balance, interest rate and monthly payment
• Credit card, auto loan, student loan and other outstanding debt balances
• Social Security benefit estimate, if applicable
• Life, disability and long-term care insurance policy details
• Will, trust and other estate planning documents, if applicable
• Employee benefits information, including retirement plans, insurance and stock options

Your adviser may ask you to upload these documents to a secure online portal before your appointment or bring them to the meeting. Don't worry if you can't find everything on the list. Bring what you have and follow up with any missing documents afterward. There's no need to delay your first meeting.

Know where your money is going

It’s helpful for your financial adviser to understand where your money goes each month; with that information, they can help you decide how to best save and invest your money to meet upcoming expenses or goals.

Estimate your typical monthly spending. If you have a budget, that can be a good place to start, since it outlines your recurring expenses. Identify any major recurring expenses, like your mortgage, health insurance and car and home insurance costs, and make sure you factor these expenses into your monthly spending.

It’s also important to flag any large expenses coming in the next few years, such as:

• Buying a home or making major renovations
• College tuition or other education expenses
• Major travel or vacations
• Purchasing or replacing a vehicle
• Medical expenses or planned procedures
• Retirement or a planned career change
• Supporting aging parents or other family members
• Weddings or other major family events

Be sure to account for any income that varies throughout the year, such as commissions, bonuses, freelance earnings, rental income or stock-based compensation. Let your adviser know if you expect any significant changes to your income, too.

Be ready to talk about more than money

During your first meeting with a financial adviser, you won't just talk about the specifics of your saving and spending. An adviser might ask you questions to better understand your priorities and attitudes about money, such as:

• At what age would you like to retire?
• What does your ideal retirement look like?
• How comfortable are you with investment risk and potential market losses?
• Does anyone depend on you financially, such as children or aging parents?
• Do you expect to receive an inheritance?
• Do you want to leave an inheritance for your family or other beneficiaries?
• Is charitable giving important to you?
• What are your biggest financial concerns?
• Do you anticipate any major life changes, such as marriage, divorce, a career change or relocation?
• How confident do you feel about managing your finances?
• Would you prefer to be actively involved in financial decisions or have an adviser take a more hands-on role?

Prepare questions for the financial adviser

Your first meeting with a financial adviser gives you a chance to get to know them and make sure that they’re the right fit for your needs, too. Don't be afraid to ask about their experience, qualifications, fees and approach to financial planning. Come prepared with a few questions to ask, including:

• How are you compensated, and do you earn commissions?
• What will I pay in fees, and are there any additional costs?
• What financial planning and investment management services are included?
• What professional credentials and certifications do you hold?
• Do you regularly work with clients who have financial goals and circumstances similar to mine?
• Do you have minimum investment or account balance requirements?
• What is your approach to investing and managing risk?
• Who will manage my investments and oversee my financial plan?
• How often will we meet to review my financial plan?
• How will we communicate between meetings?
• How will we measure progress toward my financial goals?
• Are there any potential conflicts of interest I should know about?
• How can I verify your credentials and check your disciplinary history?

Understand how financial advisers get paid

Financial advisers may be compensated in several ways, and that structure can affect what you pay. Don't hesitate to ask about how the adviser is paid, and then ask any follow-up questions you might have about how the structure affects your costs.

Your adviser should be willing to help you understand how their structure works, but here are a few common fee structures for financial advice that advisers may use:

• Assets under management (AUM): Adviser charges a percentage of the assets they manage for you
• Flat fee: Client pays a set amount for a financial plan or ongoing advice
• Hourly fee: Adviser charges for the time spent providing advice
• Subscription or retainer: Client pays a recurring monthly, quarterly or annual fee
• Commissions: Adviser may receive compensation when a client purchases certain investments, insurance products or other financial products
• Combination: Some advisers use more than one compensation method

Fee-only and fee-based advisers may sound similar, but there's an important distinction.

Fee-only advisers are compensated directly by their clients and don't earn commissions from selling financial products.

Fee-based advisers also charge clients for their services, but they may earn commissions from recommending or selling certain investments, insurance policies or other financial products.

To understand what you'll actually pay, ask the adviser to explain their fees in dollars, not just percentages. Find out which services are included, such as financial planning, investment management, tax planning or estate planning guidance.

Also, ask about additional costs, including investment fund expenses, trading fees or account maintenance charges. These expenses may not be included in the adviser's fee and can add up over time.

Know what happens after the first meeting

After your first meeting, your financial adviser may ask for additional documents or schedule a follow-up appointment to discuss their recommendations. Ask when you can expect to receive a financial plan and what steps you'll need to take next.

You may also receive an engagement agreement outlining the services the adviser will provide, their responsibilities and the fees you'll pay. Review the agreement carefully and ask questions about anything you don't understand before signing.

Don't feel pressured to make a decision right away. Take the time to choose a financial adviser you trust, feel comfortable working with and believe can help you achieve your financial goals.

Don't feel pressured to make a decision that day

You don't need to have your finances perfectly organized before meeting with an adviser. What's more important is having a clear understanding of your financial goals and being prepared to discuss your priorities. Remember, the first meeting is just as much about evaluating the adviser as it is about reviewing your finances.

By the end of the meeting, you should understand what services the adviser offers, how much you'll pay and what to expect next. Most importantly, you should feel confident that they're someone you can trust to help you reach your financial goals.

Use the tool below to connect with a financial professional who can help:

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Having a pension can provide a powerful foundation for retirement. If you also have significant savings, your planning challenges may look very different from those of the average retiree.

For many Americans, retirement planning revolves around one question: "Will I have enough money to last?" But what if you have a pension that will provide reliable income for life, and you've also accumulated $1 million or more in savings?

This changes the retirement planning equation. I know this because, as a CERTIFIED FINANCIAL PLANNER® professional and the founder and CEO of Peak Retirement Planning, I specialize in serving those with pensions and more than $1 million saved.

You may have more flexibility than you realize when it comes to investing, withdrawing money and managing taxes. At the same time, having a pension and significant assets can create planning challenges that are easy to overlook, particularly when it comes to required minimum distributions (RMDs), Roth conversions and your eventual legacy.

I call this group the 2% Club: People who have both a pension and substantial retirement savings (I even wrote a book about this group — you can request it for free).

Many also fit what I call the Midwestern Millionaire profile: Hardworking, frugal and diligent savers who spent decades prioritizing saving over spending.

If that sounds like you, congratulations. You've done the hard part. Now comes the part that requires a different kind of planning.

Here are seven areas to put on your retirement checklist. And if you'd like to watch a video about it, here you go:

1. Build an investment plan around your pension

One of the biggest mistakes I see is assuming that every retiree needs the same investment portfolio. You may have heard that retirees should simply use a traditional 60/40 portfolio, but there is no universal investment allocation that works for everyone.

A pension can significantly change your risk profile because it provides a source of income that isn't dependent on the performance of your investment portfolio. Think of your pension as one part of your overall retirement income picture, then ask:

• How much income will I need from my investments?
• How much of my spending will my pension cover?
• What are my goals for leaving money to my children or grandchildren?
• Do I have charitable goals?
• How much investment risk am I comfortable taking?
• How important is preserving principal vs maximizing long-term growth?

For someone whose pension covers most or all of their essential expenses, their investment portfolio may have a different job than it does for someone who depends heavily on portfolio withdrawals. That could mean taking more investment risk because you have a reliable income floor.

On the other hand, it could mean taking less risk because you don't need your portfolio to generate aggressive returns.

The key is that your pension should be incorporated into your investment strategy, not treated as a completely separate issue.

2. Pay attention to tax location, not just asset allocation

Once you have determined what you should own, the next question is: "Where should you own it?" Many retirees have money spread across several types of accounts:

• Traditional IRAs and 401(k)s
• Roth IRAs
• Taxable brokerage accounts

These accounts don't all receive the same tax treatment, which creates an opportunity to think strategically about tax location.

For example, if you have growth-oriented investments that you expect to appreciate substantially over time, holding some of those investments in a Roth account may allow that future growth to occur tax-free, assuming you follow the applicable Roth account rules.

At the same time, assets designed primarily for preservation or income may be candidates for tax-deferred accounts, depending on your broader strategy.

Your taxable brokerage account presents another opportunity. Investments that generate capital gains may receive different tax treatment than investments generating ordinary income.

Tax-loss harvesting can also potentially help offset capital gains and ordinary income, while a properly constructed portfolio may offer greater tax efficiency.

The point isn't that one type of investment always belongs in one particular account; it's that your investment and tax strategy shouldn't operate independently. Where you hold an investment can be almost as important as what you invest in.

3. Prepare for RMDs

If you have accumulated substantial money in traditional IRAs, 401(k)s or other tax-deferred accounts, RMDs deserve attention well before they begin.

Under current law, the applicable starting age depends on your birth year, with some individuals subject to RMDs beginning at age 73 and those born in 1960 or later generally beginning at 75.

For someone with a large tax-deferred balance, RMDs can become significant.

Consider a hypothetical retiree who is 60 and has $2 million in tax-deferred accounts. If those assets continue to grow for another 15 years, the balance could be substantially larger by the time RMDs begin.

This is where having a pension can create an unusual situation. Many retirees have been told that they'll automatically fall into a lower tax bracket after they stop working, but if you have a sizable pension, Social Security and substantial tax-deferred savings, your taxable income in retirement could remain high, or even increase.

Your pension provides valuable income, but it can also mean that you have less room to absorb large RMDs at low tax rates.

That's why planning for RMDs should begin years before the first distribution is required.

4. Consider whether Roth conversions make sense

Roth conversions can be one tool for addressing a large future RMD problem. The basic concept is straightforward: You move money from a tax-deferred account, such as a traditional IRA, into a Roth IRA and pay the applicable income taxes on the converted amount.

In exchange, the money can potentially grow tax-free in the Roth account, and qualified Roth IRA withdrawals are tax-free. The challenge is determining how much to convert and when.

Converting too much in a single year could push you into a higher tax bracket or trigger other tax consequences. Converting too little could leave you with a large tax-deferred balance and potentially larger RMDs down the road.

That's why I prefer to think about Roth conversions as a multiyear tax-planning strategy rather than a one-time transaction.

For retirees with pensions and substantial tax-deferred assets, the goal may be to create greater tax diversification by having money available in taxable, tax-deferred and tax-free accounts.

This diversification can provide more flexibility later. You don't necessarily know what your future tax rate will be, but you can give yourself more options by not having your entire retirement portfolio concentrated in one tax bucket.

5. Plan for the 'widow's penalty'

For married couples, retirement planning shouldn't stop at determining whether both spouses have enough money. You also need to ask: "What happens financially when one spouse passes?"

When a married couple file taxes jointly, they benefit from married-filing-jointly tax brackets and a larger standard deduction. After one spouse passes, the surviving spouse may eventually have to file as a single taxpayer, and at the same time, the surviving spouse may lose some income, depending on the pension and Social Security benefits involved.

This combination can create what is sometimes called the "widow's penalty." The surviving spouse could have less income but pay more in taxes. This is one reason tax planning should happen before a spouse dies.

For example, a married couple may want to evaluate whether Roth conversions or strategic withdrawals make sense while both spouses are alive and filing jointly.

And don't overlook the practical side of the equation. If one spouse has always handled the investments, taxes and financial decisions, what happens when that spouse is gone?

A successful retirement plan isn't just one that works mathematically; it needs to be a plan that the surviving spouse can understand and implement.

6. Don't overlook legacy planning

If you've accumulated significant wealth, retirement planning eventually becomes estate planning. That means making sure the legal documents supporting your wishes are in place and up to date.

At a minimum, review whether you have the appropriate documents, such as:

• A will
• Financial and healthcare powers of attorney
• Healthcare directives or a living will
• Beneficiary designations
• Appropriate trust arrangements, when applicable

But estate planning isn't just about determining who gets your money; it's also about determining how efficiently they receive it.

For example, inherited retirement accounts can have different tax consequences than inherited taxable investments.

Under current rules, many non-spouse beneficiaries who inherit retirement accounts are generally subject to the 10-year rule, meaning the account must be distributed within 10 years. This can create significant tax consequences for beneficiaries, particularly if they inherit a large traditional IRA and are already high-income earners.

State estate and inheritance taxes can also matter, particularly for retirees living in states with their own estate tax systems.

The more you've accumulated, the more important it becomes to look at your retirement and estate plans as one integrated strategy.

7. If you haven't retired yet, carefully evaluate your pension options

If retirement is still a few years away, don't wait until you're ready to walk out the door before examining your pension options. This is particularly important when evaluating survivorship options and lump-sum choices.

A pension may offer several ways to structure your benefit. You might have to choose between receiving a larger monthly payment for yourself or accepting a reduced payment that continues to a spouse after your death. There isn't one universally correct answer.

Your decision should consider your spouse's age, health, other income sources, assets, life expectancy and the amount of income they would need if you passed first.

In some cases, life insurance could potentially be part of the equation. In other situations, retaining the pension's survivor benefit may make more sense. And some households may have enough assets that they can effectively self-insure.

The key is to calculate the actual need. Don't spend thousands of dollars for a survivorship benefit simply because you're afraid of what could happen. But also, don't eliminate a valuable survivor benefit simply because you're trying to maximize your own monthly check.

The same principle applies to the lump-sum option. The attractiveness of taking your pension as a lump sum can depend on factors such as interest rates, the pension's financial strength, your investment strategy, your income needs and your legacy objectives.

It shouldn't be an emotional decision driven by fear; it should be a mathematical and financial decision based on your specific circumstances.

Having a pension and significant retirement savings is something to celebrate, but it also means you shouldn't necessarily follow generic retirement advice designed for someone with an entirely different financial picture.

Your pension may give you greater flexibility with your investment portfolio. Your savings may create opportunities for Roth conversions and tax diversification. Additionally, your higher retirement income may make tax planning even more important.

The biggest mindset shift may be this: Your goal isn't simply to avoid running out of money. If you've spent decades being a disciplined saver, you may actually have the opposite problem; you may need to learn how to confidently use the wealth you've accumulated.

That means planning not only for how to maximize your money, but also for how to maximize your life, purpose and experiences in retirement.

A successful retirement plan should answer more than "Will I have enough?" It should answer, "How can I use what I've built to live the retirement I actually want?"

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Would you like to leave a legacy to your children, grandchildren or other loved ones?

A trust fund will accomplish that, but you'd likely need to hire a lawyer to draw up documents. There also may be ongoing management fees that will reduce the amount your heirs will receive.

Unless you're leaving a vast estate, a trust fund is likely overkill. Simpler, cheaper ways to leave a defined legacy include cash-value life insurance, a 529 college savings plan and annuities.

All three have their advantages, but I'm going to focus on how different types of annuities can fund your legacy. (As founder and CEO of AnnuityAdvantage, I'm a retirement income expert.)

Income annuity keeps on giving

One of the better options, a lifetime deferred income annuity, is often overlooked. It's the only gift guaranteed to keep on giving for a lifetime. The vehicle converts a cash deposit into a stream of future income, much like a private pension.

Here's how it would work using a grandchild as an example. (It would work the same way for a child.) You would buy a lifetime annuity — also called a deferred income annuity — for your grandchild. It defers income payments until a future date that you choose.

Let's say your granddaughter is 10 years old. You make a $100,000 deposit. You decide to have payments begin when she reaches age 25 and continue for the rest of her life.

There won't be the normal 10% penalty the IRS levies on interest withdrawals before age 59½, because there's an exemption for systematic distributions over life expectancy.

As of mid-September 2026, when I was writing this article, one top insurer will guarantee a payment of $1,229.71 per month, with $1,083.37 of it taxable. If your grandchild lives to age 85, she would collect $885,391, including $785,391 in taxable interest plus tax-free return of the $100,000 of principal, over the payment term.

It's foolproof

An income annuity has no cash surrender value. Your grandchild or child won't be able to blow the money all at once on a fancy pickup or lavish vacation. And since he or she will receive a check from you every month, you'll be remembered fondly.

If you choose annual payments, you could have the electronic or paper check arrive each year on your grandchild's birthday or on Christmas, Hanukkah or another holiday.

The checks can increase if you add an inflation-protection rider so that the amount will go up over time. This option will help the recipients retain future purchasing power. However, it will reduce the initial payments.

Another advantage is tax efficiency. When income is received, only a portion of it will be taxable. This is because part of the income from this type of annuity is considered a return of principal, and part is considered earnings.

While earnings are taxed, return of principal is not. Once all principal has been repaid after many years, the payments will be fully taxable.

Guaranteed annuities with cash value also work

The drawback of an income annuity is that because there's no cash value, the child or grandchild can't tap it to pay for education or a home or anything else. Three types of deferred annuities — variable, fixed-rate and fixed-indexed — do offer cash value as well as income options.

Variable annuities offer growth potential but are not principal-guaranteed, so we'll focus on the other two varieties.

Multi-year guarantee annuities (MYGAs), the main type of fixed-rate annuity, behave much like a bank certificate of deposit (CD), paying a set, guaranteed interest rate for up to 10 years. Interest is tax-deferred until withdrawn.

Most MYGAs allow penalty-free withdrawals, sometimes up to 10% of the policy value annually.

Fixed-indexed annuities pay interest based on the performance of a stock market index, giving policyholders a portion of the index return. So they offer more growth potential than MYGAs.

However, when the market is down for the year, they normally pay nothing, but they never decrease in value. Therefore, the interest rate fluctuates markedly from year to year.

Indexed annuities usually also allow penalty-free withdrawals of a portion of the policy value.

Tax matters

To avoid tax problems, the child or grandchild should be listed as the primary beneficiary, not the owner of the policy. Then, upon the death of the policyholder, the contract value will be paid out as a death benefit and won't be subject to the 10% IRS early-withdrawal penalty. They will still owe standard income tax on the untaxed gains.

The beneficiary can receive a lump sum, but some insurers will charge surrender penalties and market-value adjustments for a full death-benefit payment if the contract is still subject to an early surrender penalty.

Other options for the beneficiary typically include various monthly payout options, such as lifetime payments.

An insurance company cannot pay a deferred annuity's death benefit directly to a minor. To name a minor as a beneficiary, specify a Uniform Transfers to Minors Act (UTMA) account, which designates a trusted adult custodian to manage the funds until the child reaches legal adulthood. An UTMA is easy to set up.

While others may give gifts that are soon forgotten, providing loved ones with an ongoing gift of income that will last for the remainder of their lives will ensure that you have created a legacy for yourself as well as a nice financial cushion for the younger generation of your heirs.

Ken Nuss is the founder and CEO of AnnuityAdvantage, a leading online provider of fixed-rate, fixed-indexed, and income annuities. Ken is a nationally recognized annuity expert and widely published author. A free rate comparison service with interest rates from dozens of insurers is available at www.annuityadvantage.com or by calling (800) 239-0356. The firm also offers an income-annuity quoting service. There are no fees or charges for the firm's services; 100% of the client's money goes to work for them in their annuity.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Carlos, an experienced accountant based in Los Angeles, called me with a six-word question: "When should I claim Social Security?"

Then his Mexican pension pulled up a chair.

His final year of work sat down beside it. A planned move back to Mexico arrived, carrying two suitcases. The tax rules brought a calculator and no sense of humor.

Within minutes, Carlos's one question had formed a committee.

He had worked legally in the U.S. since 2009. His Mexican pension was expected to begin in January 2027. His initial plan was to continue working in the U.S. until approximately September 2027 and then return home to Mexico.

But even as an accountant, he struggled to navigate all the rules and scenarios of the Social Security Administration (SSA). He worried: Should he claim when the pension began, when work ended, after moving, at full retirement age or at 70?

Five dates. Each had an argument in its favor.

Carlos had come looking for a date. I needed to understand what he wanted that date to accomplish.

First confirm which choices are available

Before weighing the alternatives, I confirmed that Carlos qualified on his U.S. earnings record. We couldn't assume his Mexican work history would fill any gaps: The U.S.-Mexico Social Security agreement has not entered into force.

His remaining earnings also mattered. Claiming before full retirement age while still working could cause benefits to be withheld under the retirement earnings test.

SSA later adjusts the retirement benefit at full retirement age to account for affected months.

Fortunately for Carlos, his Mexican pension wouldn't trigger a reduction under the Windfall Elimination Provision (WEP) as it no longer applies to benefits payable for January 2024 and later. But overseas payment rules and tax residency still needed attention.

Those rules established the boundaries. They didn't choose a filing date for him.

The pension changed the question

Near the end of our conversation, I asked, "How much money will you need each month once you return to Mexico?"

"About $2,200," he said.

Carlos was single and already owned his home there.

"And how much will your Mexican pension provide?"

"The equivalent of $2,500 a month."

His expected pension exceeded his stated monthly budget by about $300, before adding any U.S. Social Security. We still needed to consider taxes, unexpected expenses and whether that budget would remain adequate over time. But the numbers changed the discussion.

Returning to Mexico and claiming Social Security were separate decisions. Once his pension began, he could consider going home, living on that income and delaying his U.S. benefit.

Delaying retirement benefits beyond full retirement age earns credits until age 70. That could give Carlos a larger monthly payment and, depending on his lifespan, greater lifetime benefits.

It was a reasonable option. Then he explained what the comparison had missed.

Waiting meant postponing generosity

"Ray, I was kinda thinking that if I had my Social Security money now, I could use it to take care of my family and friends."

For the first time, the committee went silent.

Carlos missed the people he loved. His parents had both died in their 60s. Many of the friends and relatives he wanted to return to were now in his age bracket. He didn't know how many years they would have together.

His parents' experience didn't predict his lifespan. It did help explain why a larger check years later held less appeal than the opportunity to help someone sooner.

An accountant understands that money has a time value. Carlos was also thinking about the value of time.

I quickly understood his real question: How much future income would he give up by claiming earlier, and was using that money sooner worth the trade-off to him?

That required calculation. It also required listening.

Give the math the right assignment

I explained that a complete individualized analysis could compare the filing dates, incorporate his remaining earnings and quantify the differences. The pension's apparent ability to cover his budget didn't make the alternatives financially identical.

It gave him room to weigh something beyond basic bill-paying.

My responsibility was to help Carlos understand the consequences of each choice. The largest number on his Social Security statement wasn't a commandment.

You don't need a foreign pension to face a similar decision. You might want to retire while a spouse is healthy enough to travel, reduce work to care for a parent or preserve dependable income for your later years.

Start by describing that objective. Then compare realistic claiming dates using your spending needs, other income, taxes and family circumstances. Include a longer-than-expected life in the analysis.

Wanting to enjoy the present doesn't eliminate the need to finance the future.

Carlos's pension gave him an option worth exploring. His wish to help people explained why he valued it.

A financial analysis could estimate the price of claiming earlier. It couldn't calculate the value of generosity delivered on time. The most useful question we discussed wasn't printed on his benefit statement: What is the money for?

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• Are You Much Older Than Your Spouse? Sorry, But Your Social Security Decision Isn't About You
• Why You Need to Start Your Social Security Claim 4 Months Early: 7 Steps to Prevent a Delay at the Worst Possible Moment
• Don't Let Low Tax Rates Lull You Into the Torpedo Zone: If You Have $1M to $3M in Tax-Deferred Savings, You Could Be Looking at Brutal Tax Bills in the Future

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

To help you understand the trends surrounding business and technology and what we expect to happen in the future, our highly experienced Kiplinger Letter team will keep you abreast of the latest developments and forecasts. (Get a free issue of The Kiplinger Letter or subscribe.) You'll get all the latest news first by subscribing, but we will publish many (but not all) of the forecasts a few days afterward online. Here's the latest…

Artificial intelligence will be transformational, akin to the dawn of the internet, but unfolding at a faster pace. But overspending on AI is creating a bubble, in our judgment, like other major industrial projects in history, such as railroads, electrification or the web.

Here’s how we currently see the state of play.

AI outpaces previous building booms

AI is the largest infrastructure project ever. U.S. spending is double the dot-com peak, when the telecom and fiber build-out hit 1.2% of GDP in 2000, according to an analysis by the investment firm Apollo. AI is now at 2% of GDP and will soon be 3%.

Big Tech spending will hit $1 trillion next year in capital expenditures from Alphabet, Amazon, Meta and Microsoft, according to data compiled by Bloomberg. That’s up from $700 billion this year and $380 billion in 2025. Back in 2022, it was $150 billion. With big spenders Oracle and SpaceX, it’s even higher. Though the spending is expected to level off, there’s no end in sight for $1 trillion-plus yearly outlays.

Unlike previous infrastructure build-outs with up-front spending on things that lasted decades, AI spending resets every four to six years as high-priced AI chips in data centers need to be upgraded, along with other equipment.

And improving AI is getting more expensive, requiring more computation and electricity to develop leading-edge AI. New AI models can cost $1 billion. A huge, 1-gigawatt data center? $60 billion, according to Nvidia CEO Jensen Huang.

Some of the most significant risks

Among risks that bear watching: The drastic business shift of tech giants from high-margin software to capital-intensive infrastructure. Once fountains of cash, most of the top AI spenders will have negative free cash flow this year and in 2027. S&P Global doesn’t project a recovery of FCF for most major players until 2029, a timeline that would lead to mounting pressure and possible investor blowback.

Debt-fueled financing with increasingly complex structures, such as special-purpose vehicles, or SPVs, which get debt off Big Tech’s books. Recently, Nvidia spearheaded a plan with investment firms, such as BlackRock and Goldman Sachs, to unleash $500 billion in AI financing. The plan seeks to turn AI chips in a data center into an investable asset and highlights how the AI boom is being financed by unconventional means. BlackRock CEO Larry Fink compared it to the creation of mortgage-backed securities in the 1970s. Those MBS securities went on to play a leading role in the 2008 financial crisis.

The massive spending commitments. For example, Alphabet has $811 billion in obligations, mostly for AI. OpenAI has plans to spend $800 billion through 2030 to build some of the world’s biggest data centers in New Mexico, Texas, Wisconsin and Michigan. Flexibility may be hard to come by with multiyear deals for chips, power and land. Big Tech spenders are forecasting demand for AI years in advance, an inherently dicey proposition.

Circular deals, such as Nvidia financing the purchase of its own chips. For example, Nvidia is providing up to $105 billion in financing for an OpenAI data center in Ohio. Even with a torrent of cash from soaring chip sales, Nvidia can’t maintain the pace of its recent extensive dealmaking, according to a report by Morningstar’s PitchBook. Another example: Microsoft has a 25% stake in OpenAI, which accounts for 70% of Microsoft’s AI sales.

The collective action problem of tech executives, all willing to overspend in the pursuit of “superintelligence,” an ill-defined AI breakthrough. “The risk of underinvesting is dramatically greater than the risk of overinvesting,” said Sundar Pichai, the CEO of Alphabet, back in 2024. Four or five tech companies breaking the bank to build the most advanced AI is not viable over the long run. It would not be surprising if, eventually, the race results in two to three leading-edge providers.

Other risks include AI turning into a low-cost commodity, stemming from both efficiency gains and cheaper AI services, including Chinese models, flooding the market. That could lessen demand for the most advanced, premium-priced AI. A terror attack or other rogue event involving AI could spur regulations that slow down or restrict the technology in an onerous way. Or AI improvements could slow or stall, lessening the pressure to spend so heavily on developing new AI systems.

The arguments against a bubble

Many analysts take issue with bubble talk, since revenue is exploding at Anthropic, OpenAI and other firms. Tech giants such as Alphabet and Amazon have diversified global businesses that cater to both businesses and consumers, with massive amounts of revenue. Plus, demand for AI is vastly outpacing supply, even as businesses cope with high costs.

AI use has exploded among businesses and consumers as free chatbots from Meta, Alphabet and OpenAI have proliferated. OpenAI has 900 million active weekly users, plus over 50 million consumer subscribers, with plans starting at $8 per month. Anthropic has hundreds of thousands of paying business customers and is on track to make tens of billions of dollars in sales per year.

But the revenue earned from AI is still far from keeping up with the necessary computing’s soaring cost. For AI spending to be sustainable, the tech must expand beyond employee productivity software or even entire IT budgets. AI must disrupt and reshape entire industries, from manufacturing and financial services to health care and retail. Businesses would need to shift huge amounts of spending that they now devote to labor and funnel it to AI products and services.

Amid AI’s fast adoption, tech executives have acknowledged the risk of a bubble. For example, Amazon founder Jeff Bezos has called what’s happening an “industrial bubble,” where investor excitement leads to certain money-losing bets but also breakthrough ideas. Meta CEO Mark Zuckerberg has said that a bubble is “definitely a possibility,” like those stemming from major infrastructure projects of the past.

"I am worried about the world's compute build-out plans," said OpenAI CEO Sam Altman in an interview in early September. Altman sees the first signs of "unsustainable silliness" of certain AI cloud companies, known as neoclouds, that claim they will build “gigantic amounts of compute” without securing the needed financing or customers.

The bottlenecks to AI progress

There are likely bottlenecks that slow AI adoption by businesses and consumers, ranging from human behavior to regulatory issues. That friction is sure to delay the full potential of AI, including all the enhanced productivity it promises. For Big Tech spenders, such delays will be hard to endure as they seek higher revenue and profits.

Another issue not to be overlooked is the major roadblocks to AI deployment, especially accessing the needed power, along with shortages of chips, equipment and labor. Some analysts point to roadblocks as a built-in factor staving off a bubble, preventing too much development, too fast. But those roadblocks will be more evident over the long term rather than in the short run. The explosion of data center opposition is a real concern, but tech giants have ample data centers in the pipeline for now.

Bubbles fund breakthrough ideas

It’s not clear when a bubble would burst or deflate. A fallout could include AI start-ups going out of business and certain infrastructure providers facing lumbering debt loads. The Kiplinger Letter’s view is that a pullback in spending could spark a mild recession, as the tech bust did in 2001.

Still, overspending on AI will be useful, pouring money into valuable areas that lay the foundation for an economic leap. Promising areas include AI software that automates complex white-collar office tasks, AI models that accelerate drug discovery and AI coding tools that automate computer programming. The ultimate winners of the race may not be the heavy spenders of today, but future start-ups that launch new products and services enabled by AI.

But on the cusp of all this potential, there’s no doubt that uncertainty and financial risk are rising.

This forecast first appeared in The Kiplinger Letter, which has been running since 1923 and is a collection of concise weekly forecasts on business and economic trends, as well as what to expect from Washington, to help you understand what’s coming up to make the most of your investments and your money. Subscribe to The Kiplinger Letter.

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For years, retirees were told that saving $1 million was the benchmark for a comfortable retirement. Today, that number feels increasingly outdated, and recent studies bear that out. Americans now believe they will need nearly $1.5 million to retire comfortably.

Rising costs, longer life expectancies and market uncertainty have left many retirees wondering whether they'll outlive the money they spent decades building.

That fear is only becoming more common. Whether you're a young saver just starting your career or on the brink of retirement, the worry is less about if you can retire and more about if you've saved enough to maintain your current lifestyle.

The real retirement problem isn't always saving — it's spending

One of the biggest retirement planning mistakes people make is that they assume that their spending habits will remain the same or decrease in retirement; in reality, they might increase. Their lifestyle no longer matches what their savings can support.

High earners typically struggle with this more than most. They were used to increased spending during their working years, but once the paycheck stops in retirement, they're met with a rude awakening.

I've seen many retirees struggle with this problem throughout my career. Rarely is the issue about whether they saved enough, but whether they can live on the income their savings generate. That's why I believe it's important to find ways to replace the paycheck you've lost.

Replacing your paycheck

If you're no longer receiving monthly income from an employer, how do you replace it?

For many, Social Security alone won't be enough to cover essential living expenses. The answer lies in building a retirement plan around guaranteed income first and investment growth second.

Utilizing guaranteed income sources, such as annuities, allows the rest of your portfolio to remain invested in the stock market for growth and added flexibility.

This approach can reduce the emotional stress that often comes with relying entirely on the stock market for retirement income. All it takes is one bad year in the markets to potentially threaten the longevity of your money.

Creating multiple sources of income

Annuities are designed to address those fears directly. Think of an annuity like a self-funded pension. Instead of a company paying into a retirement savings vehicle, you're the one funding the investment. You contribute funds to the annuity, and in exchange, an insurance company promises to pay you a certain amount of money for a set period, depending on the type of annuity you purchase.

This predictable income stream can help cover basic living expenses such as housing, healthcare and utilities, replacing the paycheck you lost once you stopped working.

Annuities tend to be a safer investment because the value never goes down due to market conditions. It reduces the need to sell investments during downturns or worry about whether one bad year in the market will hurt your monthly cash flow.

The other portion of your money should stay invested in equities and other growth assets for discretionary spending and long-term opportunity.

Don't miss your window; plan early

Like many things in life, timing matters. I recommend people start building their retirement income plan about three to five years before retirement. That window gives you time to structure income strategies, evaluate expenses and prepare assets for the transition from accumulation to distribution.

Planning early gives you more flexibility and a better sense of whether you're on track to retire when you want. Instead of wondering whether you can afford to retire, you can start envisioning how you want to spend your time and what you want to do in your golden years.

Interest rates and opportunity

The current interest rate environment has also created a unique opportunity for retirement income planning.

While consumers often associate higher interest rates with expensive mortgages and credit cards, higher rates can also improve payouts on certain guaranteed income products such as annuities.

When interest rates were hovering near historic lows a few years ago, retirement income payouts were far less attractive. Today, higher rates have significantly changed the math for some retirees looking to create predictable income streams.

The bottom line: Retirement confidence comes from income security

Retirement planning isn't about hitting a magic savings number. It's building a strategy that aligns with the life you want to live.

1. Start planning three to five years before retirement. Create an income strategy before leaving work.

2. Build your retirement around income, not just portfolio size. Focus on replacing your paycheck to ensure essential expenses are covered.

3. Understand if your retirement can support your current lifestyle. If they don't match, make the appropriate adjustments to ensure your savings last.

The retirees who most often struggle are those who focus only on growing their money, without a plan to turn that money into predictable income, should market volatility strike.

On the other hand, the retirees who feel most confident know exactly where next month's paycheck is coming from, even if they no longer work for one.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Stocks closed lower Tuesday as market participants took in a lackluster start to earnings season and looked ahead to Wednesday's key inflation update. A steep sell-off in several semiconductor stocks didn't help, with reports that China's CXMT is making progress on its memory chip designs putting pressure on this corner of the market.

At the close, the blue-chip Dow Jones Industrial Average was down 0.4% at 51,670 and the broader S&P 500 was 0.02% lower at 7,805. The tech-heavy Nasdaq Composite, meanwhile, shed 0.2% to 27,204 as mega-cap memory stocks, including SK Hynix (SKHY, -3.2%) and Micron Technology (MU, -3.6%), slumped.

Johnson & Johnson (JNJ) was the worst Dow Jones stock today, falling 5.7% after the drugmaker reported earnings. JNJ beat top- and bottom-line estimates for its third quarter, but sales in its medical devices division fell short of Wall Street's expectations due to the ongoing conflict in the Middle East.

There are "countries that still value and actually want premium healthcare systems, think Kuwait, UAE, Saudi Arabia," J&J Chief Financial Officer Joe Wolk told CNBC. "They pride themselves on having solid healthcare, very good healthcare. But their budgets now are being resourced and allocated towards defense."

Looking for more timely stock market news to help gauge the health of your portfolio? Sign up for Closing Bell, our free newsletter that's delivered straight to your inbox at the close of each trading day.

JPMorgan reports a double miss

Elsewhere on the earnings calendar, JPMorgan Chase (JPM, -0.9%) reported second-quarter earnings of $5.75 per share, up 13.4% year over year but below analysts' estimates. JPM's revenue of $50.2 billion also fell short of expectations.

"JPMorgan had a rare miss against expectations," says David Wagner, head of equity and portfolio manager at Aptus Capital Advisors. "Dimon called it another quarter of strong results, but gave few clues on the shortfall, which was partly securities losses, and he said the bank cut back on share repurchases in the quarter. The franchise still looks healthy, but the quality of the quarter was a step below what investors have come to expect."

Among the other big banks reporting, Wells Fargo (WFC, -3.1%) fell short on revenue, while Goldman Sachs (GS, -0.2%) and Citigroup (C, -5.6%) beat on both the top and bottom lines.

Bumble goes private in $1.3 billion deal

Bumble (BMBL) surged 56.6% today and is up 134% this week on news the dating app will be taken private by Ithaca Holdings in an all-cash deal valued at $1.3 billion.

The female-founded platform, which prioritized user safety, went public in 2021 and closed its first day with a market cap of $7.7 billion. It has been a downhill slide since then, with BMBL stock's current market value closer to $783 million.

"Bumble was founded on a simple belief: meaningful relationships are essential to a healthy, happy life. Today, that belief feels more important than ever," said Whitney Wolfe Herd, Bumble's founder and CEO, in the press release. "In Ithaca, we have found a partner who shares our vision, believes in our women-first mission, and is committed to investing in Bumble's future."

Inflation data is on deck

Earnings will remain in focus on Wednesday, with Bank of America (BAC, -1.1%) and Morgan Stanley (MS, -1.8%) among those reporting. But most of Wall Street's attention will be on the release of the September Consumer Price Index (CPI) report.

"The September CPI could determine whether the Fed's next hike is imminent, or simply still ahead," explain UBS Global Research economists. "An upside surprise, particularly in the core, could revive the October debate, both moving market pricing and influencing the decision itself," while a print closer to forecasts "would leave the Committee with room to wait."

According to CME Group FedWatch, futures traders are currently pricing in a 78% probability that the Federal Reserve keeps interest rates unchanged when it meets later this month. Odds for a December rate hike are at 70%.

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In mid-September, the Federal Reserve raised interest rates for the first time in three years. In its policy statement, the central bank stated that "inflation remains elevated," and the rate hike "will support a timelier return to the Committee's 2 percent goal."

The decision followed the August Consumer Price Index (CPI) report, which showed headline inflation was "uncomfortably high," explains David Payne, staff economist and reporter for The Kiplinger Letter. The pickup, he says, was driven by higher gas and fuel oil prices, shelter costs and airfares.

And with energy costs likely to stay elevated as the situation in the Middle East remains unresolved, Payne believes the annual CPI rate will end the year at 4%, while core CPI will be at 2.7%.

With another Fed meeting on the near-term horizon — the central bank will announce its next policy decision on Wednesday, October 28 — the release of the September CPI report is a key economic event we're tracking.

According to the Bureau of Labor Statistics (BLS), the CPI rose 0.6% from August to September and 3.7% year over year.

This is faster than the 0.4% monthly and 3.4% annual increases seen in August, with the year-over-year rate coming in above economists' estimate of a 3.6% rise.

"The index for gasoline rose 9.1 percent in September, accounting for over half of the monthly all items increase," according to the BLS. "The energy index increased 5.2 percent over the month following a 2.1-percent increase in August."

Shelter costs were higher, too, while food prices were unchanged.

What is the CPI?

"CPI is a measure of the average price of that basket of goods and services over time," writes Kiplinger contributor Coryanne Hicks. "The specific goods and services within the CPI basket are based on information that around 24,000 families and individuals give the U.S. Bureau of Labor Statistics on what they buy."

The two primary measures of CPI are headline, which is the total inflation rate experienced by households, and core CPI, which excludes volatile food and energy prices.

Core CPI rose 0.3% month over month in September, the same as in August. Year over year, core inflation was up 2.6%, faster than the 2.4% rise from the month prior.

Economists expected core CPI to rise 0.2% month over month and 2.5% year over year.

Prices for recreation, used cars and trucks, education, airline fares, medical care and apparel were higher, while communications costs were slightly lower.

With the September CPI report on the books, we looked at what economists, strategists and other Wall Street experts are saying about the data and what it means for the Fed and the economy. These outlooks, edited at times for brevity, are below.

What Wall Street thinks about the September CPI report

"Chairman Warsh advised market participants to focus on the trend and not the incremental data. September CPI leaves intact the upward trend in core prices over the last 6 months. At the margin, it bolsters the case for a hike at the October FOMC. However, we think the bigger picture is the balance of risks. The economy is growing strongly so the FOMC can place more emphasis on the inflation mandate." - Brad Conger, Chief Investment Officer at Hirtle & Co.

"Today's warmer core CPI release bolsters the case for additional rate hikes, but recent dovish Fed-speak from New York President Williams and Governor Jefferson suggests that the bar is high for an immediate hike. In our view, September's print was likely not sufficient for the Fed to execute back-to-back increases at the October FOMC meeting. The steady rise in long yields has increased corporate/consumer borrowing costs and tightened financial conditions alongside the Fed's move, meaning the bond market has been doing some of the heavy lifting for the Fed." - Jeff Schulze, Head Investment Strategist at Franklin Templeton Institute

"Wednesday's CPI was stronger than expected, and it's clear as ever that inflation is stubborn and moving in the wrong direction. The inflation uptick is likely to lead the Federal Reserve to start a rate-hiking cycle. While we expect the Fed to pause on any rate changes in October, we expect rate hikes to resume in December and continue until June 2026. The Fed will not tolerate inflation at these levels and will apply the same playbook as it did in 2022 to keep it in check with a series of interest rate increases." - Skyler Weinand, Chief Investment Officer at Regan Capital

"Today's CPI report came in hotter than expected with September headline rising 0.649% MoM and core CPI increasing 0.335% MoM, versus expectations of 0.58% and 0.21%, respectively. With underlying inflation failing to cool, the September rate hike now looks like a start rather than a final move, and expectations for further rate hikes have increased. The Fed will remain data-dependent, but the focus now turns to October 28, where a second consecutive hike is firmly on the table." - Dustin Thackeray, CFA, Head of Portfolio Management at Crewe Advisors

"In our view, today's print puts the Fed's tactical breather priced into the market for October in question. With $100-plus crude adding friction to already sticky core prices, the latest data increasingly complicates the disinflation narrative and may limit the Fed's flexibility." - Tim Urbanowicz, Chief Investment Strategist, Innovator ETFs from Goldman Sachs Asset Management

"CPI came in hot and it wasn't just fuel prices, as core inflation ran at a 3.7% annualized pace in September and 3.2% over three years. The only surprise is that investors keep getting surprised by broad-based inflation. And we've yet to see the full impact of higher diesel prices and the AI boom. Another Fed hike to 4.3% looks likely this year, but that's hardly restrictive enough to bring inflation down to 2%." - Sonu Varghese, Chief Market Strategist at Carson Group

"Inflation is cooking with gas. It is abundantly clear where the inflation impulse originates, but two wars need to end before we get any relief. The Federal Reserve made the mistake of calling COVID-era inflation transitory, and now it appears they are set to make the same mistake in reverse on the energy supply shock." - Jamie Cox, Managing Partner for Harris Financial Group

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Our recent article about home warranty companies that promise to replace or repair your major appliances and HVAC systems — but have a nasty habit of telling subscribers to pound sand when their AC fails in 110-degree summer heat — got one heck of a response from readers all across the country.

Several (with a sense of humor) came up with mottos for their "disaster" that are hysterical, but we can't print them.

People who needed to have major home appliances — refrigerators, stoves, air-filtration systems — replaced with quality products but were given the run-around also called.

One told me, "We were referred to their own vendor's salespeople who had no product knowledge and would be happy to replace our item with a similar one that has a history of complaints and a high failure rate."

Sales presentation verified 'like with like' replacements

One couple had the foresight to record the sales presentation, which they played for me. They asked, "If you do replace an appliance, will it be the same or better than what we now have?"

The sales rep replied, "I have worked in insurance for years, and we do like-for-like replacements, which means, if not the same brand, it will be equivalent to what you now own."

That statement is likely false, as home warranty companies generally do not use "like for like" language in their contracts, but it sure sounds like a good reason to plunk down your money for what — often — is a bottomless pit.

"When they offered us junk as a replacement," the same couple said on our Zoom call, "our attorney played the recording for them, and all of a sudden, the company treated us correctly."

They, and others, suggested that an article could explain why it is important to establish a long-term relationship with people in appliance sales who consider themselves career professionals — in it for the long-term — and "not just after a quick commission, so you can obtain accurate and honest information."

Deal with a professional appliance salesperson

From people just starting out in life to families with children and grandchildren, the reality of homeownership is that, sooner or later, we all need to replace a fridge or other major appliance. When that becomes apparent, the first question usually is, "Where do I go for the best deal?"

I submit that is not the key question to ask.

Given the complexity and options available on today's washers/dryers, refrigerators, freezers, etc., guidance and personalized recommendations from a knowledgeable home-town appliance dealer's sales staff far outweigh saving a few dollars when buying from a "big box" store.

Often, if you ask a local dealer to match a price, they will.

Long-term, career appliance specialists offer customers distinct advantages, and I just happen to know two in my town — Adam and Ryan — who work at Urner's, a century-old, locally owned appliance retailer.

While Adam recently retired, my wife, Anne, and I considered him "our" go-to appliance guy because of the guidance he provided across the years. Now, Ryan is filling Adam's shoes.

I sat down to chat with them on this topic. Here is a summary of our discussion.

Adam: My job was never to just to sell you an appliance. I wanted to help you find the right fit for your specific lifestyle, kitchen dimensions, budget and so on. Especially with new customers, our interaction was all about having a meaningful consultation, not just quickly closing a sale. This means that I had to have, and customers need to probe, a salesperson's:

• Product and brand knowledge. How easy is it to use this washer? All brands have their own peculiarities that part-time clerks at a big-box store might not know, including details that could easily create issues for buyers, such as complex installation requirements, ventilation needs and warranty coverages.
• Long-term accountability. My business depended largely on referrals and repeat clients. If an appliance arrived damaged, or there were other issues, I would advocate for my customers to help bring about a positive resolution. I obtained so much new business because once the sale is made at many so-called discount stores, that's it! Customers could not count on the salesperson to help them resolve a problem.

When your fridge fails in the middle of summer

Ryan: I agree with all of Adam's points and will add something no one ever wants to see happening: Appliances fail at the worst times, and this past summer, so many did because of the heat waves.

With an established relationship, you don't need to drive to a showroom or research online, which be confusing. Instead, call your salesperson, explain what happened — and this is where the trust you have both developed pays off — they will find an appropriate replacement and jump through hoops to help you.

How to figure out who the career appliance salespeople are

In my experience of hearing complaints from customers of both big-box and independent appliance dealers, when employees are making a sale, they seem to care only about getting rid of inventory that earns them a commission or meeting a quota, and they often couldn't care less about after-sales support.

I recommend visiting showrooms that are run by independent dealers who carry a variety of brands. Ask to speak with the manager and just say, "May I ask for your help? I would like to speak with one of your career salespeople — someone who has been here for years."

That shows two things:

• You are a serious and informed customer
• You respect people who have one of the most challenging jobs — sales!

Dennis Beaver practices law in Bakersfield, Calif., and welcomes comments and questions from readers, which may be faxed to (661) 323-7993, or e-mailed to Lagombeaver1@gmail.com. And be sure to visit dennisbeaver.com.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

As someone planning for the future, protecting your health and savings is likely at the top of your list.

The cost of healthcare, especially long-term care, can quickly erode even a substantial nest egg. While Medicare provides vital health coverage, it has limits — particularly when it comes to long-term custodial care such as nursing homes.

That's why many people are turning to a tool called a Medicaid Asset Protection Trust (MAPT) to shield their assets while maintaining access to Medicare and Medicaid benefits.

What is a Medicaid Asset Protection Trust?

An MAPT is a specialized legal arrangement designed to protect your assets and help you qualify for government healthcare programs.

Unlike a straightforward will or a general trust, an MAPT is specifically crafted to help people navigate the complex rules surrounding Medicare and Medicaid eligibility.

At its core, the MAPT moves selected assets out of your personal ownership and places them into a trust.

This legal shift can reduce your countable assets when government agencies evaluate your eligibility for Medicaid's long-term care benefits, while still allowing you — or someone you trust — to manage and use the assets for your benefit.

Why is this important?

Medicare offers excellent coverage for hospital stays and certain medical services but provides limited support for long-term custodial care, the kind of ongoing help many people need as they age.

Medicaid, on the other hand, covers long-term care costs but comes with strict eligibility rules — especially regarding your assets.

Many retired people face a harsh choice: spend down their savings to qualify for Medicaid or pay out-of-pocket for costly long-term care. An MAPT offers a third, smarter option. Here's why:

Preserve your savings. The MAPT can protect your life savings, your home, investments or other assets from being fully spent on nursing home or in-home care. This gives you peace of mind knowing your financial legacy is secure.

Ensure eligibility for Medicaid benefits. By placing assets in the trust, you reduce your personal resources in the eyes of Medicaid without losing control or access to those assets. This helps you meet Medicaid's asset limits more easily and quickly, ensuring you get the care you need.

Maintain control of your finances. Contrary to popular belief, creating an MAPT doesn't mean you lose all control. Depending on how the trust is set up, you can still access funds for your care and daily expenses or appoint a trusted family member to manage the trust in your best interest.

Avoid probate and promote privacy. Assets held in a trust often bypass the lengthy probate process, allowing your heirs to avoid court delays and maintain confidentiality about your estate.

Plan ahead to avoid a crisis. Establishing an MAPT before a health crisis strikes is crucial. Medicaid has a "look-back" period (usually five years), scrutinizing any asset transfers made before applying for benefits. Proper planning can help navigate these rules and prevent costly penalties.

Until you provide every receipt, distribution and bank statement for all transfers predating the application for Medicaid benefits for the prior five-year period, you are responsible for paying the costs of care.

Who should consider an MAPT?

If you have assets such as a family home, savings or investments, and you anticipate needing long-term care, an MAPT might be a valuable part of your estate planning.

It's particularly beneficial if you want to protect your wealth for children or other heirs while ensuring access to government healthcare assistance.

Consult an experienced elder law attorney

Navigating Medicare and Medicaid rules can be complicated and varies by state. An elder law or estate planning attorney familiar with local regulations can guide you in creating an MAPT tailored to your situation, ensuring compliance and maximizing your benefits.

An MAPT offers people a strategic way to protect assets, maintain access to Medicaid long-term care benefits and plan without exhausting their savings.

It's a safeguard that balances financial security and healthcare needs, helping you maintain control, dignity and peace of mind as you age.

If protecting your assets while qualifying for government healthcare assistance is a concern, now is the time to explore whether a Medicaid Asset Protection Trust fits your retirement plan.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

To help you understand what is going on in the technology and finance sector, our highly experienced Kiplinger Letter team will keep you abreast of the latest developments and forecasts (Get a free issue of The Kiplinger Letter or subscribe). You'll get all the latest news first by subscribing, but we will publish many (but not all) of the forecasts a few days afterward online. Here’s the latest…

Federal regulators want to transform how investors trade public equities. The Securities and Exchange Commission (SEC) has unveiled a five-year "innovation exemption" allowing tokenized stocks to trade on public blockchains. Under the new policy, “Tokenized Securities Venues” operating automated market makers will receive relief from registering as traditional stock exchanges. Additionally, liquidity providers contributing proprietary capital will enjoy a temporary exemption from broker-dealer registration requirements.

Tokenization, the process of issuing and transferring traditional assets like stocks and bonds on blockchain, is seen as a way to potentially attract more investors and increase trading capabilities outside of regular stock market hours.

The New York Stock Exchange, Nasdaq and the London Stock Exchange are already planning to launch tokenized stocks. Crypto exchanges Coinbase and Kraken are also planning to offer them to customers. Several crypto exchanges, including Kraken and Robinhood, already offer tokenized stocks to customers in Europe.

Wall Street meets 24/7 markets

Blockchain-based equity markets will unlock unprecedented global trading liquidity. Retail and institutional investors will gain round-the-clock access to public stocks, instant settlement, and self-custody options. Supporters say tokenized stocks give investors more flexibility, allowing them to earn interest or take out instant loans using their shares at any hour. Automated software on blockchain could also pay dividends directly to shareholders, saving companies time and money on administrative costs.

By contrast, skeptics warn that continuous trading will create severe pricing risks. Financial policy experts caution that traditional market off-hours serve as a vital cooling-off period to prevent panic selling during sudden crises. More critically, early offshore platforms demonstrated how fragmented liquidity can severely distort asset values. Because various crypto exchanges issued isolated tokens without standardized redemption mechanisms or clear ties to underlying shares, traders could not easily perform arbitrage to close price gaps — causing stock tokens on some platforms to trade at up to four times, or 300% above, the real stock price on the NYSE or Nasdaq.

Regulatory watchdogs will face steep hurdles monitoring continuous stock markets. Critics argue that waiving standard exchange rules for digital venues weakens market oversight, making price manipulation harder to detect and reducing customer protections. Without traditional opening and closing bells, public companies will also have to rethink how they release earnings reports and major announcements, as market news will trigger immediate overnight price reactions before investors have time to digest the information.

Strict standards for tokenized shares

Crypto platforms will need to grant full shareholder rights to comply.

Under the SEC rules, tokenized shares must offer the same economic and governance protections as traditional stocks, including voting rights, dividend payouts and liquidation claims. The agency explicitly prohibited synthetic tokenized derivatives and security-based swaps. Furthermore, underlying public companies will receive advance notice and the power to object before third parties list tokenized versions of their shares.

Analysts expect major digital asset firms like Coinbase, Robinhood and Circle to emerge as early winners by expanding custody, tokenization infrastructure and stablecoin settlement.

Built-in guardrails for the blockchain trading pilot

Strict trading volume caps will govern the initial trial phase. The SEC framework restricts eligible assets to listed securities, capping Tier 1 stocks at 75 and 0.25% of the prior month’s average daily share volume and Tier 2 stocks at 250 and 2.5% of average daily volume. This means that for Nvidia (NVDA), one of the most highly traded shares and a Tier 1 stock, qualifying venues could facilitate trading in up to roughly 312,500 tokenized Nvidia shares per day. For comparison, Nvidia has an average volume of 126 million shares per day.

Additionally, venues are barred from hosting initial public offerings, extending margin leverage or executing trade lending during the exemption period. These restrictions will allow regulators to gather operational data on continuous trading without disrupting market stability.

The Kiplinger Letter has been running since 1923 and is a collection of concise weekly forecasts on business and economic trends, as well as what to expect from Washington, to help you understand what’s coming up so you can make the most of your investments and your money. Subscribe to The Kiplinger Letter.

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The myth of the lone entrepreneur is exactly that: A myth.

While vision and determination are essential, sustainable growth rarely happens in isolation. The most successful business leaders understand that collaboration isn't a concession. It's a strategy.

By partnering with the right people and organizations, companies expand their reach, strengthen their capabilities and create opportunities that would otherwise stay out of reach.

The business landscape is filled with partnerships that created value far beyond what any one organization could achieve alone. From global corporations to neighborhood coffee shops, collaboration has long served as a catalyst for innovation and competitive advantage.

Organizations that combine complementary strengths simply accomplish more together than they can separately.

The evidence is everywhere

Consider Starbucks and Barnes & Noble — a store-within-a-store concept. By bringing coffee shops into bookstores, both companies created an experience that encouraged customers to linger and spend more.

Starbucks gained a steady stream of customers; Barnes & Noble transformed its stores into destinations rather than mere retail outlets.

The same principle played out on a larger scale with Nike and Apple. Combining fitness and technology created a new experience for consumers and strengthened both brands' connection with customers in ways neither could have achieved alone.

Collaboration is just as powerful for smaller businesses. A boutique hotel that partners with local restaurants and tour operators offers visitors a richer experience while generating business for the entire community.

An independent retailer that partners with neighboring businesses on joint promotions can attract customers who might never have found it otherwise.

As the owner of Embrace Resort in the Bahamas, I've seen this firsthand. The most successful partnerships in the resort and tour industry weren't between large corporations, but between businesses with complementary services and shared interests.

Relationships with independent transportation providers, local tour operators and regional airlines created opportunities that benefited everyone involved. Each business extended its reach, enhanced the customer experience and generated new revenue.

The common thread: Partners brought different strengths to the table. One provided customers, another expertise. One contributed technology, another brand recognition.

Together, they created value that exceeded what either could produce independently.

How you can build a partnership

Successful collaborations rarely happen by accident. The strongest partnerships are built deliberately, with careful consideration given to shared values and aligned objectives.

Before entering any partnership, look closely at your customers and identify gaps in your offerings. The best opportunities emerge when one business provides something the other can't, creating a more complete experience for customers.

For many entrepreneurs, the greatest challenge is accepting that some control must be shared. That's uncomfortable for founders who built their businesses through independent decision-making.

Yet successful partnerships require trusting others and accepting that not every decision will rest in your hands. Enter the relationship with a clear understanding of where responsibilities begin and end.

Due diligence matters

A successful partnership requires more than a signed agreement. It requires trust, transparency and a clear understanding of how value will be created and shared.

When partnerships are built on mutual benefit and open communication, they become powerful engines for growth. When they're not, resentment quickly replaces cooperation.

Collaborations should never be informal handshake arrangements. Strong partnerships rest on clearly defined expectations, responsibilities and accountability, starting with a carefully drafted agreement outlining each party's obligations, decision-making authority and performance expectations.

Success metrics should be established from the outset and reviewed periodically.

A well-structured agreement does more than define how a partnership works when things go right. It anticipates what happens when challenges arise.

Engage legal counsel familiar with partnership agreements to identify risks and address exit strategies before they're needed. Planning for the unexpected isn't distrust. It's sound business leadership.

None of this is easy

Collaboration means sharing credit, ceding control and trusting that someone outside your organization has your best interests at heart.

For founders who built their businesses through sheer will, that can feel like a shift in identity, not just strategy. It means admitting, at least implicitly, that you can't do it all yourself, a notion that runs against the very instincts that got most entrepreneurs into business in the first place.

But the businesses that figure it out gain something their go-it-alone competitors never will: Leverage.

The boutique hotel doesn't need its own tour company. The independent retailer doesn't need a marketing department the size of a national chain. They need the right partner, the right agreement and the discipline to build trust before they need it.

That leverage compounds over time, turning what started as a single deal into a network of relationships that quietly reinforce one another.

The myth of the lone entrepreneur persists because solo success makes a better headline. But look closely at any business that's scaled sustainably, and you'll find partnerships quietly doing the heavy lifting.

• Coffee in a bookstore
• Fitness data on a wrist
• A regional airline and a tour operator who figured out everyone wins when the visitor has a better trip

The opportunity is out there for any business willing to look past its own four walls. The only question is whether you're ready to find it.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Stocks closed mixed in Monday's quiet session. While the equity market was open, the bond market was closed for the Columbus Day and Indigenous Peoples' Day holidays. No earnings and economic reports were scheduled for release today, though the action picks up starting tomorrow.

At the close, the blue-chip Dow Jones Industrial Average was up 0.4% at 51,850, as Salesforce (CRM) climbed 2.1% on a double upgrade from BofA Securities analyst Tal Liani.

Liani lifted his rating on the Dow Jones stock to Buy from Underperform, the equivalent of Sell, and raised his price target to $285 from $160. Salesforce, which is down 12% year to date, hasn't traded near $285 since May 2025.

"Our prior concern centered on AI-driven disintermediation," writes Liani in a note to clients. "However, conversations with CIOs and other market participants suggest that large enterprises (more than small-to-medium-sized businesses) are unlikely to replace platforms that house their business logic, data, workflows and compliance frameworks."

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And AI, Liani adds, "should deepen dependence on these platforms." He believes that Salesforce has a credible AI strategy and is poised for strong free cash flow generation.

The bull market celebrates its fourth anniversary

The broader S&P 500 (-0.06% at 7,807) and tech-heavy Nasdaq Composite (-0.4% at 27,245), meanwhile, finished slightly lower Monday.

The Dow is roughly 4.5% below its record high from early August, while the S&P 500 and Nasdaq are perched not far from the all-time peaks they notched last week.

Today marked the fourth anniversary of the current bull market. The S&P 500 has gained roughly 118% on a price return basis, "surpassing the historical average of ~90% and ranking as the third-strongest bull market since 1945. Along the way, it has produced 124 record highs, more than double the average (~50) of the seven prior bull markets that lasted at least four years," says Raymond James Chief Investment Officer Larry Adam.

Adam adds that volatility has remained below average over the past four years, while earnings growth, rather than multiple expansion, has fueled the bull market's returns.

And history suggests there's more room to run. According to Adam, the average bull market lasts about five and a half years, with the fifth year averaging roughly 15% annually and finishing positive 90% of the time.

This week's inflation data could spark volatility

And while today's price action was relatively muted, "this week's inflation data could be a near-term volatility trigger," says Chris Larkin, managing director of Trading and Investing at E*TRADE from Morgan Stanley.

First up is the September Consumer Price Index (CPI) report, which will be released Wednesday morning. Headline inflation was "uncomfortably high" in August, writes David Payne, staff economist and reporter for The Kiplinger Letter, in the Kiplinger inflation outlook. The pickup was caused by higher gas and fuel oil prices, shelter costs and airfares, he explains.

And with energy costs likely to stay elevated as the situation in the Middle East remains unresolved, Payne believes the annual CPI rate will end the year at 4%, while core CPI, which excludes volatile food and energy prices, will be at 2.7%.

As for September, BofA Securities economists expect headline inflation to be higher than in August thanks to higher gas prices, while core inflation could moderate as tariff-related pressures ease. However, the group warns that core CPI could accelerate if airfares keep rising. If this happens, the Fed could be encouraged to raise interest rates in October for a second straight meeting.

Earnings season gets rolling this week

Larkin believes the new earnings season, which gets rolling this week, "may play a bigger role in shaping the market's momentum into year-end, since it may signal how strong those tailwinds really are."

Third-quarter earnings season is expected to be strong. FactSet Senior Earnings Analyst John Butters says current projections are for a 30% year-over-year S&P 500 earnings growth rate. If this is the actual earnings rate, it will mark the third straight quarter of year-over-year earnings growth, he adds.

This week's earnings calendar features a handful of blue chip and financial stocks. Johnson & Johnson (JNJ, +0.9%) and JPMorgan Chase (JPM, +0.4%) kick things off bright and early Tuesday morning.

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More than one-third of Americans (37%) plan to make a change to their portfolio or investment strategy this year.

That's according to New York Life's Wealth Watch 2026 Midyear Outlook. It is not hard to see why. Inflation, interest rates, market volatility, the boom of generative AI and a steady run of unsettling headlines have left many investors feeling they should do something different with their money.

The instinct is understandable, but acting on it without a detailed financial plan can be costly, and your portfolio is only one part of your strategy.

Changing your portfolio can be one of the smartest moves you make, or one of the most damaging. The deciding factor is rarely the market itself. It's whether the change reflects your long-term strategy or reacts to short-term noise.

Before you rebalance or reallocate, here is how to tune out the distractions.

Know what is driving the urge

Begin by naming the pressure you feel, because the trigger for a portfolio change is not always the same as the source of financial stress. Headlines and market swings could prompt the urge to act, but our data show that day-to-day costs are weighing more heavily on many investors.

Higher costs of living topped the list of financial concerns, cited by 61% of respondents, while market volatility was named a top concern by just 15%.

In other words, many people feel the squeeze most directly through groceries, housing and gas, even if market news is what gets their attention.

That distinction counts, because pressure on your monthly budget likely calls for a change to how you spend or save, not how you invest.

Avoid two common mistakes

When people act, they tend to err in one of two directions.

The first is to overreact: Chasing last year's winners, trying to time the market or making decisions based on whatever is trending. Today, that often means turning to technology for answers.

In our survey, 13% of people said they research financial topics with generative AI. These tools can help with education, but they might not know your full financial picture, including your goals and your timelines.

The second mistake runs the other way: Doing nothing. About 29% of people told us they took no action in response to factors affecting their finances.

Paralysis and panic look different, yet they often share a root cause: the absence of a strategy.

Run every change through five lenses

Whether you manage your own investments or work with a financial adviser, test any proposed change against five questions before you act.

1. Does it serve your long-term goals? A portfolio move should ladder up to something specific, such as a retirement date, a home or a college fund. If you can't explain how a change advances a goal, treat that as a warning sign.

2. Does it match your risk tolerance? Adjusting your asset allocation — the mix of stocks, bonds and other holdings — is the change that most directly reflects your comfort with risk. Any shift should reflect how much volatility you can absorb, not how you feel this week.

3. What are the tax consequences? Taxes are an often overlooked cost of trading. Selling an appreciated asset, moving money between account types or realizing gains can trigger a bill that erases the benefit of the change. Model the after-tax outcome before you trade.

4. Are you diversified and protected? A resilient plan involves more than the assets you hold. Insurance and guaranteed income belong in the same conversation as your investments. Diversification and protection are what keep a single bad year from derailing an entire plan.

5. Will it hold up against your retirement income needs? This is where changes get personal. Any change you make today should be judged against the income you'll need to generate for decades, not against this year's return.

The case for working with a financial adviser

If this data holds one lesson, it is that the investors who feel most confident about their money are the ones who aren't going it alone. Close to a third (30%) of American adults say they don't have a strategy. Among people who work with a financial adviser, however, that figure is 5%.

That gap follows through to financial confidence: 44% of those who work with a financial adviser are very confident their retirement savings will last the rest of their lives, against 24% of adults overall.

Across nearly every measure of preparedness we track, from emergency savings to debt to retirement readiness, the advised group runs roughly one and a half times ahead of the general population.

None of this means advice does the work for you, and it doesn't mean sitting still. People who work with a financial adviser are more likely to plan portfolio changes this year, not less: 44% vs 37% of Americans overall.

That's the point. A financial adviser gives you a framework for deciding when to change course and how — based on a full picture of your financial life.

Should you make changes to your portfolio this year? Perhaps. If a change reflects your goals, your timeline and your tolerance for risk, it might be the right move.

If it reflects a headline, an app or the knot in your stomach, treat that as your signal to pause and consider talking it through with a trusted financial adviser before you act.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

I once worked with a family in which the parents had built substantial wealth and didn't share the details with their children for decades.

Their four adult children were all successful in their own right, but they didn't discover the full financial picture until they were in their 50s and early 60s, when their parents finally brought everyone together with an attorney and a financial adviser to review their estate plan.

This isn't an uncommon issue. According to Kiplinger's Trillion Dollar Talk survey, conducted by Morning Consult, more than half of parents ages 55 and older say they rarely or never discuss money with their children.

These parents hoped one child would step in to help manage the portfolio and that the others would take on roles like executor or trustee. Instead, the children left the meeting feeling frustrated and unprepared. They urged their parents to hire someone outside the family entirely.

The wealth wasn't the problem. The problem was that nobody had built the muscles for stewardship until the day they were suddenly required.

As a legacy planning specialist at Novare Capital Management, I think about preparing the next generation less like a single event and more like a curriculum, one where the lessons grow with the child instead of arriving all at once in a conference room.

Here's the road map I walk families through, stage by stage.

Elementary and middle school: Save, spend, give

The foundation starts simple: Help a child become intentional with every dollar they receive.

One family I worked with paired basic money lessons with a values-based twist. Each year, their three children picked a charity, researched it and presented why it mattered to them.

The child who showed the strongest research and conviction chose that year's family vacation destination, and every child still made their own donation, matched by the parents.

It turned saving and giving into something the kids competed to get right, and by the time they were adults, they brought that same confidence into estate planning conversations instead of feeling overwhelmed by them.

A savings match works the same way. If a child saves a dollar, the parents contribute 25 cents. It's a small practice, but it introduces the idea of matching contributions years before that child will encounter an employer 401(k) match.

Whatever structure you use, keep the terms consistent and let the child retain some control, including the freedom to spend within clear guidelines.

High school: Real costs, real stakes

Teenagers need lessons that move from abstract to practical. If you started a savings match earlier, high school is when a teen can begin contributing a percentage toward bigger costs, such as a car, a musical instrument or sports equipment.

That shared stake teaches delayed gratification in a way allowance never will.

This is also the right window to introduce responsible credit use, while the teen still has parental guardrails at home rather than encountering credit for the first time during their freshman year of college.

For investing specifically, I like mock trading exercises that let teens experience real market swings without real money on the line.

Investors with a Schwab brokerage account can use paperMoney, a free virtual trading platform, to practice buying and selling with fake money. It's a lower-pressure way for a teen to get comfortable with market swings rather than jumping straight into a real account, like an UTMA a grandparent funded with $10,000, where mistakes carry real consequences.

One mistake I see often: Trying to get a 16-year-old to care about retirement, which is too abstract at that age.

The more effective play is teaching the underlying skills, delayed gratification, budgeting, paying yourself first and comparing fees and providers, since those transfer directly into retirement readiness later without requiring a teenager to care about something that's 50 years away.

The 20s: Building independence without a safety net

Young adults need a budgeting approach that covers both savings and debt at the same time. That means understanding high-yield savings accounts, prioritizing high-interest debt paydown and building an emergency fund that can cover three to six months' worth of expenses.

This lesson is more important than many people realize: If parents become the automatic backstop for every setback, that precedent is hard to undo later.

This is also the age to talk through what support looks like if that emergency fund isn't enough. If an adult child needs to move home for a few months, will they pay rent or contribute to groceries? Is there an end date?

Working out those terms before a crisis hits keeps the conversation feeling like a plan instead of a rescue.

30s and beyond: From teaching to partnership

Once adult children reach their 30s, the goal shifts from teaching habits to preparing them for real roles in the family's financial future.

If regular family meetings haven't started yet, this is the time, and I recommend starting with a "ground rules" session rather than a numbers session: How does this family want to communicate about wealth going forward?

You don't need to open the full balance sheet to have this conversation. Plenty of families aren't ready to disclose the size of an estate, and that's fine. Disclosure comes later.

What matters first is whether the family has built the communication and trust to handle it when it does.

Four signs your children are ready for more

Age is a poor predictor of readiness. What I look for:

• Can they explain where their money went and why?
• Do they consistently save before they spend?
• Can they compare options and ask questions before making a decision?
• When they make a financial mistake, do they learn from it instead of hiding it or expecting someone else to fix it?

Those four behaviors tell you more about a child's readiness to handle money than any birthday will.

Let's revisit the family I opened with. Their children weren't incapable — they were simply never given the stage-by-stage practice that would have made a room full of legal documents feel familiar instead of overwhelming.

You don't need a perfect plan or a full disclosure meeting to start. You need one honest conversation at whatever stage your kids are at right now — and a willingness to keep having it as they grow.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Required minimum distribution season sneaks up on many retirees.

RMDs are the amounts you must withdraw from tax‑deferred retirement accounts once you reach the required age, which is 73 for individuals born from 1951 through 1959 and 75 for those born after 1960.

Failing to take an RMD can be an expensive mistake. Vanguard research estimates that missed RMDs cost investors as much as $1.7 billion a year, and most of that loss is avoidable with better organization and planning.

Every year, millions of people log into their IRA, withdraw the smallest amount required and move on. The RMD becomes a chore to complete before December 31.

This approach misses the point. An RMD is one of the most important annual decisions in retirement planning. How you handle it can influence your:

• Taxes
• Medicare premiums
• Charitable giving
• Investment allocation

It can also affect the legacy you leave to heirs.

The question is not how to merely satisfy the RMD requirement, but how this year's distribution should fit into your spending, tax strategy, charitable goals and estate plan.

Get organized, then get clear on what you need

One of the biggest challenges with RMDs has nothing to do with taxes. It is simply tracking down every account and calculating what you owe, which turns into a headache when your savings are scattered across several institutions.

If you are approaching retirement, consolidate your retirement accounts wherever possible. Fewer accounts require a simpler calculation, and a simpler calculation means fewer costly mistakes.

Once your accounts are in order, determine how much money you actually need from your IRA.

If the full RMD covers your living expenses, the decision is straightforward.

If it does not, the RMD becomes a spending plan waiting to be written, one that can support charitable giving, fund a Roth conversion, get reinvested or build a cash cushion.

That shift — treating the RMD as a cash flow event rather than an automatic spending requirement — unlocks everything that follows.

Let charitable intent drive a QCD and watch your AGI

A qualified charitable distribution, or QCD, lets anyone who is 70½ or older send money directly from a traditional IRA to a qualified charity, excluding it from taxable income entirely.

For 2026, the limit is $111,000 per person, and each spouse with their own IRA gets a separate limit.

The temptation is to treat this purely as a tax trick. Resist that. Start instead with a simple question: How much were you already planning to give to charity this year?

If the answer is $25,000, a QCD is simply the most efficient way to move money you were donating anyway.

Here is where the strategy gets powerful. Picture a 75-year-old with a $1.5 million traditional IRA and a $60,000 RMD. She needs only $20,000 for living expenses and already gives $25,000 a year to charity.

Instead of taking the full $60,000 as taxable income and separately writing a $25,000 check, she can direct $25,000 straight from the IRA to charity through a QCD. That portion never touches her tax return. The remaining $35,000 comes to her as a normal distribution. Same total withdrawal, same charitable gift, considerably less taxable income.

The reason this matters goes beyond the tax bracket. Most people fixate on their marginal rate and stop there, but a QCD reduces adjusted gross income (AGI) directly, and AGI quietly drives a lot of other costs in retirement.

A higher AGI can trigger Medicare IRMAA surcharges, increase the taxable portion of Social Security benefits and push you past thresholds tied to other deductions.

Before adding an additional $30,000 or $50,000 to your income, do not just ask what tax bracket that lands in. Ask what it does to your entire financial picture for the year.

Time your RMD deliberately

There is a common instinct to take the RMD in January and be done with it. Unless you need the cash immediately, there is usually no advantage to rushing.

Waiting lets the year's full tax picture come into focus first, including income, charitable plans and whether a Roth conversion makes sense.

The RMD portion itself cannot be converted to a Roth IRA, but you can take the required distribution first and then, separately, convert an additional amount if your bracket allows it.

The real annual question becomes a combination of:

• How much goes out as the RMD?
• How much becomes a QCD?
• How much room remains for a Roth conversion?

Getting that mix right, year after year, is where real tax savings accumulate.

Also, remember that any amount withdrawn beyond your RMD does not carry over to reduce next year's requirement, since every year resets on its own. Extra distributions should have a clear purpose, whether that is a large expense, a gift or a Roth conversion, rather than being taken casually on the assumption they will count later.

Timing extends to the assets themselves, not just the calendar. When it is time to raise the cash, do not simply sell whatever happens to be sitting there. Look at the full portfolio first.

If stocks have run up and your allocation has drifted more aggressive than intended, the RMD is a natural chance to trim appreciated positions, generate the required cash and rebalance at the same time, turning a required withdrawal into a disciplined investment decision instead of an afterthought.

Think beyond this year

For retirees with substantial IRAs and genuine charitable interests, QCDs can become part of a longer-term legacy strategy.

IRA assets left to heirs are generally taxed as ordinary income when withdrawn, while assets given to charity through a QCD are not taxed at all.

Directing a portion of the IRA to charity during your lifetime, rather than leaving the whole balance to be taxed later, accomplishes the same charitable goal more efficiently than doing it through your estate. And by drawing down the IRA instead of a taxable account, which gets a step up in basis at death, you may leave your noncharitable heirs better off, too.

The retirees who handle this best treat it as an ongoing process rather than a once-a-year fire drill.

Early in the year, estimate income, review charitable intentions and identify the right RMD and QCD amounts.

Confirm everything is executed well before the December rush and keep simple records of every QCD, including the charity, the date and the amount, since documentation matters for tax reporting.

Markets shift, tax laws change and personal goals evolve, so an RMD strategy built once and never revisited will eventually fall out of step with your life.

The retirees who get the most value out of this season stop thinking of it as a withdrawal requirement and start treating it as one of the most useful planning conversations they have all year.

Related Content

• The 7 RMD Tax Traps Waiting for You in Your 70s — and How to Start Disarming Them in Your 60s
• Got $2.5 Million Saved for Retirement? Here Are the Huge RMDs You Must Take at 73, 75, 80 and 85
• 5 Costly RMD Mistakes That Will Put a Dent in Your Savings (and How Early Planning Can Help)
• Good Job on Cutting Costly Investment Fees, But These 8 Tax Traps Can Hurt Far More
• Five Keys to Retirement Happiness That Have Nothing to Do With Money

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

More retirees are asking AI the money questions they used to ask financial advisers.

The appeal is obvious. AI chatbot answers arrive in seconds, nothing is embarrassing to ask, and it costs nothing. The problem is that a wrong or incomplete answer looks exactly like a right one.

This guide explains why AI gets retirement questions wrong and provides seven steps you can use to check an answer before you act on it.

Why AI gets retirement numbers wrong

A chatbot does not look anything up. It was trained on a large body of text gathered up to a cutoff date, and it answers by predicting which words most plausibly come next. When it states a figure, it is reproducing what appeared most often in that text — it's not reading a current government page.

Retirement rules are badly suited to that, because most of the important numbers change every year.

Contribution limits are the clearest case. For 2026, the amount that can go into a 401(k) rose to $24,500, and the IRA limit to $7,500. A year earlier, they were $23,500 and $7,000. A model trained before that announcement would provide last year's figures with complete confidence, and nothing in the phrasing would suggest the numbers are stale.

Other figures can be changed by legislation, after the former figure has circulated for years. For example, the age when retirees must start taking required minimum distributions (RMDs) used to be 70½, then it was 72, then 73, and it reaches 75 in 2033. All four ages appear across the internet, usually with no date attached.

Basically, AI handles concepts reliably and specifics unreliably. The seven steps below are built around that split.

Step No. 1: Check the year on every number

Any answer containing a dollar amount, an age, a percentage or an income threshold needs a date attached before it is worth anything.

Ask the chatbot directly which tax year the figure applies to. When asked, a chatbot will often admit its information may be outdated, even though it volunteered the number without hesitation a moment earlier.

Consider any figure with no year attached suspect.

Step No. 2: Ask which agency sets the rule

This is the one question a chatbot answers reliably, because it is a concept question rather than a numbers question.

Information about contribution limits, RMDs and tax treatment should come from the IRS.

Benefit amounts and claiming ages should come from the Social Security Administration.

Information about Medicare premiums and income surcharges (IRMAA) should come from Medicare.gov and the SSA.

Pension rules sit with the Department of Labor.

Knowing which agency oversees the rule turns vague verification into a single page to open.

Step No. 3: Verify at the source

Once you get an answer from a chatbot, go to the agency's own site rather than simply reading a summary. For example, federal agency pages will state which year a figure applies to.

Skipping this step could be expensive. Missing an RMD triggers a penalty of 25% of the amount that should have been withdrawn, reduced to 10% if corrected quickly.

On a $40,000 distribution, that is $10,000 for a deadline a chatbot might have gotten wrong.

Step No. 4: Feed it your own circumstances

A chatbot answers in generalities unless you provide specifics.

Supply the details that actually influence the outcome: Age, types of accounts, pension income, state of residence and marital status, including whether your spouse has their own earnings record. (Never provide details that are personally identifiable, though.)

Then compare the answer with the answer you get when you provide none of those details.

If the response barely changes, then the advice for your particular situation cannot be trusted.

This matters most when it comes to thresholds. Medicare's IRMAA works as a cliff rather than a gradual increase — income above $109,000 in 2026 for a single filer and $218,000 for a couple.

A chatbot that suggests you do a Roth conversion without making any reference to IRMAA can lead to you facing four figures in annual premiums two years later (since IRMAA is based on your income two years ago).

Step No. 5: Ask the same question twice

Pose the question again in different words, ideally on a different day, and see whether the original response holds.

Then change one detail, such as adding five years of age or removing pension income, and check that the answer moves in a direction that makes sense.

Answers that swing wildly when you rephrase the question are being generated, not recalled. When two responses conflict, the tie gets broken by checking the relevant agency's page, not by asking the chatbot a third time.

Rawad Baroud, CFO of ZeroGPT, says that consistency should never be confused with accuracy when evaluating AI-generated information. "Generative AI can produce an answer that is clear, detailed and convincing without having verified the facts behind it.

"Asking the question again can expose inconsistencies, but getting the same answer twice doesn't prove it is correct. For financial information, the final check still needs to be against an authoritative source."

So use repetition as a warning system, not as proof of accuracy. Whether the answers are different or the same, you should always verify any important numbers or rules.

Step No. 6: Ask what it left out

Chatbots answer the question asked and rarely flag what sits outside it.

Two prompts do most of the work here:

• Ask what assumptions the answer depends on
• Ask what would make this the wrong move

A recommendation to convert to a Roth, for instance, should surface the tax due this year, the effect on Medicare premiums and the five-year rule before it counts as complete.

According to Gregor Emmian, deputy chief growth and finance officer at Rise, "The most dangerous AI answers are the ones with no caveats attached. If a chatbot tells you to convert to a Roth or claim (Social Security) early without mentioning what could go wrong, that's not a complete answer — it's half of one.

"Retirees should treat 'what am I not being told?' as a mandatory follow-up question, not an optional one."

An answer that mentions no downside is incomplete — every retirement decision requires tradeoffs.

Step No. 7: Consult an adviser when an irreversible decision is involved

Some actions cannot be undone once you do them. Claiming Social Security, converting a large sum to a Roth, buying an annuity or taking a pension as a lump sum all belong in that category.

The cost of a wrong turn here is permanent. Claiming Social Security at 62, for someone whose full retirement age is 67, reduces the monthly benefit by about 30% for life, and that reduction extends to the survivor's benefit.

On a $2,400 benefit, it is roughly $720 a month, or more than $8,600 a year, for as long as either spouse lives.

For anything in this category, print the chatbot's answer and take it to an adviser or accountant. Ask which parts are wrong and why.

That conversation will be quicker and less expansive than one you start from nothing, and it puts the specifics in front of someone who can be held responsible for them, which no chatbot can.

The bottom line: If you're using AI this way, the main thing you should keep in mind is that the moment an answer sounds the most authoritative is the moment when you should question its accuracy and explore further, preferably through the relevant agency.

Related Content

• We Gave AI Chatbots 5 Financial Challenges. Here's How They Did
• 6 Ways to Use AI to Improve Your Financial Life
• How to Protect Your Privacy While Using AI
• Sitting on Housing Wealth? How to Safely Turn Home Equity Into Retirement Income
• An Expert Guide to Your Financial Priorities Decade-by-Decade: What to Focus on in Your 30s, 40s, 50s and 60s

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Do you remember the spring of 2021? It felt like we had all been let out of COVID-19 jail. Sure, there were new variants of the virus, but most people were vaccinated and eager to swipe, tap or hand over cash.

We promptly took our then-3-year-old to Jamaica. This was the inflation liftoff.

An eagerness to spend, a money supply that was about 30% higher than pre-pandemic levels and supply shortages from shuttered factories quickly caused prices to accelerate.

If you'd told me then that I would still be writing about inflation five years later, I would have been seriously concerned. But here we are.

We have now been through what most consider an interest rate-cutting cycle that was cut short. We also have a new Federal Reserve chair, Kevin Warsh, who has been (not so) tacitly tasked with cutting rates at the same time inflation has reawakened.

The two things are at odds: Raising rates is supposed to cool inflation by making things more expensive, while cutting rates is stimulative to the economy and often inflationary.

The majority of this inflation is headline inflation (food and energy), caused by the oil shock in Iran. Because of this, the market had moved from a less than 1% chance of a rate hike at the beginning of 2026 to an almost 45% chance as of mid-May.

Indeed, in September, the Fed raised the federal funds rate by 25 basis points, to 3.75% to 4%. The Fed is expected to raise the rate again before the end of the year.

So, here's what that means for retired folks.

A bounce back in cash rates

It doesn't seem that long ago when cash was paying basically nothing. More recently, you could get cash equivalents over 5% in a high-yield savings account.

Today, most things have settled in the mid-3% range. In the 5% range, it was a pretty easy decision for retirees who needed liquidity to keep it in cash.

In the 3% range, it's a tougher question. That question is a bit easier to answer now that the Fed has hiked rates.

If you still have a lot of cash sitting in a checking account at a large bank, there is probably a better way.

Most brokerage houses have a plethora of cash-equivalent options that pay significantly more.

Good for guaranteed income

Similar to cash equivalents, guaranteed income in the form of fixed annuities tends to move up with interest rates. The higher the rate environment, the more an insurance company is willing to pay you for the same pot of money you turn over to them.

In the previous hiking cycle, we were able to replace the majority of our clients' annuities with higher income guarantees — often significantly higher.

If you have an annuity issued between 2000 and 2022, it's worth having it looked at.

Time to de-leverage

When rates rise, floating-rate loans become more expensive.

For our clients, floating-rate loans most often take the form of home equity lines, securities-backed lines of credit and adjustable-rate mortgages. If you have floating-rate debt and some money in the bank, it may be a good time to pay down those debts.

My wife's car lease ended in 2022, and we were quoted rates of 9% or more for five-year car notes. Though it shouldn't be anything like last time, this is a strong argument for buying vehicles in cash should the funds be available.

I often use 5% as a sort of back-of-the-envelope line in the sand. If the note is over 5% and you have the cash, you probably want to do that. Below 5% and financing likely makes sense.

Your financial plan should dictate this decision. In our software, we can raise the rate and then see what happens to the plan success rate if a client were to accelerate the paydown. You can play around with that same software for free.

Continued struggles in the broader housing market

If you were waiting for mortgage rates to come down to bring more buyers into the pool for your home, you'll either have to keep waiting or pull off the Band-Aid and sell.

Nationally, the housing market is struggling. There are many more sellers than buyers. It's the opposite of the insane environment coming out of the pandemic.

However, real estate is hyperlocal, and we have clients who are selling their homes with little issue.

Zooming out, higher rates are bad for the housing market. Buyers focus on what they can afford in a monthly payment more than the total price.

As interest expense goes up, that same monthly payment buys less, which should bring down housing prices.

It's good for buying, but not so good for selling.

How you can help your kids if they're trying to buy a home

Just as the pool of buyers for your property is now reconsidering a purchase, your adult children who are trying to get into the market are probably equally frustrated.

In 2022, someone who took on a $1 million, 3% mortgage was paying $2,500 per month in interest expense. Today, that same loan amount at 6.5% has a monthly interest expense of about $5,400. That's $2,900 more per month for the same loan amount.

There are a lot of factors to consider before writing a large check to your kids to help them buy a home.

Here are a few to keep in mind for intrafamily loans:

• The loan must not materially impact your situation: While this is a secured loan and you could take ownership of the home should they default, that is an ugly situation. Lend only money you know you don't need.
• This is an actual loan, not a gift: Interest must be charged at a minimum federal rate, which can be referenced at the IRS website.
• Lending money can make Thanksgiving dinner uncomfortable: This isn't just a math problem. You have to accept that you are signing up for a long-term financial arrangement within your family. For some, that's a plus; for others, it's a red line.

If the stars align, these loan rates will be lower than what your kids could get in the market, and the interest you earn will typically be higher than what you're earning at the bank.

Related Content

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• How to Help Your Children Buy a Home
• Think You Can Afford That House? Run These Numbers First
• A Financial Expert's Tips for Lending Money to Family and Friends
• Four Things to Consider Before Giving Your Kid a Down Payment

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Many women find themselves managing a financial life that became theirs alone, often after divorce or a loss, at the end of a career they built. And it tends to arrive on top of everything else they're already carrying, because women are so often the ones taking care of everyone else first — the kids, the aging parent — which means their own retirement plan is the one that never gets made.

You can see the result on a desk. The stack of papers, statements, policies, beneficiary forms and the envelopes you've been meaning to open grows taller every month.

For many, the easiest response to that stack is to look away and hope it somehow resolves itself. It rarely does, and the longer important financial decisions sit untouched, the harder they can become to unwind.

But there's a version of this that looks completely different: A Saturday morning, a cup of coffee and a single page laying out everything you'll accomplish this year in three or four clear steps.

Closing the distance between those two pictures comes down to several key things I've learned over 24 years as a wealth manager: Asking the right questions before focusing on investment returns, working through your finances as one connected system rather than a pile of separate decisions, and refusing to build a plan that takes care of everyone you love but leaves you out of it.

Why I see this differently

I didn't arrive at this work from a textbook. I married young, and we had two children. Then the marriage came apart, and I found myself raising my young kids largely on my own.

Suddenly, I wasn't just managing their day-to-day lives; I was carrying the responsibility for their financial future, too — college, first cars, opportunities and all that I wanted to make possible for them.

The lesson I took from it is one I'd offer any woman: A financial future can land on one person with no warning, and hoping it won't isn't a solid plan.

At 24, I was also diagnosed with cancer, and for a time, I needed people to care for me. That taught me something no spreadsheet could: Almost none of us is as prepared as we think for the moment we need care, emotionally or financially.

I haven't experienced widowhood, but I know loss and I know illness. Those experiences gave me a deep respect for the emotional and financial weight women can carry when life changes without warning.

I'm also one of the professional businesswomen I serve, which taught me one of the most common mistakes of all. You pour everything into your work, tell yourself you'll get to your personal finances later, and "later" keeps moving.

When a woman who has built a successful career thinks about stepping away from work, she's untangling two things at once: Her identity from the work that shaped so much of her life, and her financial future from everything she worked so hard to build.

Those experiences shaped how I work, and what follows is what they taught me.

Ask the questions that actually matter

When a woman sits down with me, she almost never opens with a question about her rate of return. She opens with the people she loves. Will my family be covered? Can I help my aging parent? Those are the questions that keep her up at night, and they tell me far more about what her plan needs to do than any performance number could.

There's another question women rarely say out loud, and it matters just as much: What do I want my life to look like now? Can I build a life I love, too?

You don't have to choose between these questions, but you do have to name them, because every one takes money, planning and foresight. I know, because I did it myself. My kids are 18 and 22 now, and both know they had their opportunities because their mother asked those questions about a decade ago and then made a plan to make it happen.

Use a framework to help guide your planning

Answering those questions takes more than good intentions; it takes a way to work through everything at once. Here's a framework you can apply to your own financial life. I call it SMART, and its five parts cover what a plan should include: How you spend, what you make, how you invest, what you leave behind and the strategy for tax efficiency.

Spend. Spending isn't one number. Over 30 or 40 years of retirement, some expenses are inflationary, some fixed, some one-time, some seasonal. It's about how much you spend and, just as importantly, when.

Make. It's not simply about how much you make today, but how much you make over your lifetime — and how thoughtfully you coordinate these income sources so they are there when you need them most.

Assets. Through market cycles, including 2008 and COVID, I learned the conviction I hold most firmly: It's not about timing the market; it's about time in the market.

Remaining assets. For your heirs, the question isn't what you leave behind but how you leave it to them. Without thoughtful planning, an inheritance can create unintended taxes and complexity for the people you love. This is where legacy, estate, trust and risk planning come together.

Taxes. The goal is to lower your lifetime tax bill, not just this year's. Wealth isn't about how much you make. It's about how much you keep.

Focus on the whole picture, not one component

I keep a Rubik's Cube on my desk because it mirrors how the SMART process works: Turn one face, and the others shift. Spending affects taxes, taxes affect what your heirs receive, and an income decision at 62 changes what's possible at 80.

A spreadsheet treats each as its own column, but your life doesn't work in columns. So don't optimize one variable at a time; sometimes the right move is to undo a step, because it sets up the two that follow.

And because every move depends on where you're headed, the only place to start is your ideal retirement lifestyle. Start there, name it specifically, and reverse-engineer the steps that help get you there.

Write yourself into the plan

This is where I see women shortchange themselves. When they name that ideal life, it's almost always built around other people: The grandchildren's education, the trip the whole family takes, the cushion that protects everyone if something goes wrong. Those are worthy goals. But notice what's missing. Her own line, the one that funds what she wants, is the first to get trimmed when the numbers feel tight, and often it was never written in at all.

I treat that line as non-negotiable, and I'd urge you to do the same in your own planning. When you map out the years ahead, give your own life a specific, funded place on the page: The second act you want to start, the part-time passion, the standing date with friends, the travel you keep deferring.

Put a number on it, the way you would your children's or grandchildren's tuition.

A plan that assumes you'll make do with whatever is left over isn't balanced; it's just the old habit of putting yourself last, written into a spreadsheet. The equation only solves when both sides, the people you love and the life you want, are actually on it.

What planning is really for

I often think about women a generation ahead of mine who spent their whole lives caring for everyone else and never once pictured what they wanted for themselves. They reach retirement and ask, almost in surprise, what now?

I want a different next chapter for the women I work with, and it's within reach for any woman willing to do the work: Ask the questions that are really about the people you love, run them through a process that treats your finances as one connected whole, and make sure your own life is written into the answer.

Do that, and the stack of papers and the dread that comes with it turns into a Saturday morning, a cup of coffee and one clear page. That is what it means to solve the equation: Not choosing between the people you love and the life you want, but building the one plan that carries both.

You can take care of everyone, leave behind something you're proud of, and still keep a life that's unmistakably your own. You just have to put yourself on the page.

Related Content

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• I'm a Financial Planner and an Only Child: Here's How to Navigate Your Parents' Older Years Solo (and Why I'd Recommend a Postnup)
• 6 Tips for Women Taking the Financial Lead in Retirement
• 3 Financial Hurdles Coming Up for Women: How to Overcome Them, From a Financial Planner
• Tips to Help Single Women Struggling to Save for Retirement

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

A 60-year-old retiree is reviewing her retirement plan. Her accounts, Social Security and withdrawal strategy all appear to work through age 85.

Then she asks the question that changes everything: "What if I live as long as my mother did? She made it to 95."

In one sentence, a 25-year income plan becomes a 35-year income plan. The issue is not whether you will live to 95; it is whether your income plan can survive if you do.

The same assets may need to fund another decade of withdrawals, market cycles and inflation. That possibility is more common than many plans account for.

According to the Social Security Administration's current actuarial life table, roughly 8% of men and 14% of women who reach 65 survive to 95.

That is why age 95 belongs in your core retirement income plan, not just in long-term care conversations.

A longer timeline changes the withdrawal math

A withdrawal percentage can create false comfort if the timeline is wrong. Recent retirement-income research estimates a 3.9% starting rate for 30 years of inflation-adjusted spending with a 90% probability of funds remaining. At 35 years, the modeled rate falls to 3.5%.

For a $1 million portfolio, that difference reduces first-year withdrawals from $39,000 to $35,000 before taxes and fees. Weak returns in retirement can make the higher spending level harder to sustain.

Retirement rarely gets cheaper simply because the projection ends. Even a steady 3% annual increase in prices would turn $60,000 of spending today into roughly $146,000 after 30 years and almost $169,000 after 35.

Build the floor before reaching for more return

An income floor starts with a simple calculation. Add up your essential annual expenses. Separate expenses that must be paid — housing, food, utilities, insurance and basic transportation — from those that can change, such as travel.

Then subtract reliable lifetime income, such as Social Security and a pension.

This is where protected lifetime income, including income from an annuity, may help.

Research from the Stanford Center on Longevity found that pooling longevity risk may support higher expected lifetime income in some scenarios than self-funding it.

An annuity with a lifetime-income feature is one way to close that gap, but it is not right for everyone. It may fit retirees who want help covering essential expenses for life and are comfortable trading some liquidity for dependable income.

Too often, retirees consider protected lifetime income only after a portfolio takes a hit. It may be more useful if you select it while you still have planning flexibility and adequate liquid reserves.

The goal is not necessarily to cover every dollar of spending with protected lifetime income. It is to protect the bills you cannot afford to miss, while keeping liquid assets for growth, emergencies and discretionary spending.

Keep the conversation about income, not products

Before comparing annuity illustrations, riders or product features, start with four practical questions:

• Which monthly bills do you need to cover no matter what the markets do?
• How much dependable income is already coming in for life?
• If the market fell 20% next year, where would spending money come from?
• How much savings do you want available for emergencies?

Those answers clarify what your income strategy needs to accomplish before product features enter the conversation. Fees, surrender periods, inflation features, death benefits and access to principal can change the result.

FINRA cautions consumers to understand costs and restrictions. Guarantees depend on the issuing insurer's financial strength and claims-paying ability.

Keep a separate reserve for surprises and an inflation strategy because a fixed payment can lose purchasing power.

Make age 95 part of the next review

At your next financial plan review, rerun the strategy through age 95, test the first five years against a severe market decline and inflate essential expenses across the full horizon.

Then ask: "Which bills do I never want the market to vote on?" If too many essential expenses depend on strong returns arriving on schedule, consider building a stronger income floor while you still have choices and liquidity.

A durable income floor may give retirees more confidence to use the rest of their portfolio for the life they planned, even if that life lasts longer than expected.

Related Content

• 4 Ways to Navigate the Unpredictable Pressures of a 30-Year Retirement, Courtesy of a Financial Planner
• How to Master the Retirement Income Trinity: Cash Flow, Longevity Risk and Tax Efficiency
• How to Manage Longevity Risk in Retirement: 10 Solutions
• The Longevity Blueprint: 4 Everyday Signs You’re Tracked for a Longer Life
• Income and Life Expectancy Not Adding Up? An Annuity Could Solve the Equation

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Most of the expensive mistakes I see in retirement planning as a CFP® are subtle. This one is not.

A Medicare enrollment trap springs most often on the very people who feel least worried about it: Those working past 65 with what they assume is perfectly good employer coverage.

But a hard Medicare deadline with a permanent penalty attached can snare people who did everything else right.

Here's how it happens, why it costs real money and what to do about it.

The setup

When you turn 65, you become eligible for Medicare. Most people know that. What trips them up is the assumption that because they're still working and covered by an employer health plan, they can ignore Medicare until they retire.

Sometimes that is true. Often, it's not, and the difference comes down to the size of the employer and the type of coverage you have.

If you work for a larger employer, generally one with 20 or more employees, your group plan can remain your primary coverage, and you can delay Medicare Part B without penalty under a special enrollment period.

But if you work for a smaller employer, Medicare might be considered your primary payer once you turn 65, even while you're still on the company plan.

In that situation, delaying Part B doesn't just risk a penalty. It can leave you with gaps in coverage, because your employer plan might pay as though Medicare is already covering its share, whether or not you're enrolled.

That distinction — 20 employees —isn't something most people think to check. They see, "I have health insurance through work," and reasonably conclude they're fine. The rules don't care how reasonable the assumption was.

The penalty that never goes away

Here's the part that stings. If you're required to enroll in Part B and you miss your window, the late enrollment penalty is not a one-time fee.

According to Medicare.gov, the Part B penalty adds 10% to your premium for each full 12-month period you could have had Part B but did not. You pay that surcharge for as long as you have Part B, which for most people means the rest of their lives.

Think about what that means. Delay three years when you should have enrolled, and you're looking at a 30% premium surcharge, every month, indefinitely. There is no statute of limitations, no point where it falls off. A misunderstanding at 65 becomes a line item you carry into your nineties.

Because that 30% applies to whatever the standard premium happens to be each year, the dollar cost climbs right along with premiums over time. Across a 20-year retirement, a few years of delay can quietly add up to thousands of dollars in surcharges you could have avoided.

I have seen people discover this years later and have no recourse, because the rules were followed exactly as written — just not by them.

The timing windows that matter

Medicare enrollment runs on specific windows, and missing them is what triggers the trouble. Your initial enrollment period is a seven-month stretch around your 65th birthday: the three months before, your birthday month, and the three months after.

If you qualify to delay because of active employer coverage at a large employer, you get a special enrollment period to sign up later without penalty, typically while you're still covered and for eight months after that coverage ends.

The danger zone is the space between assumptions and rules. People who retire and lose coverage sometimes assume they can enroll whenever they get around to it.

The eight-month clock after employment ends is easy to blow past, especially amid the chaos of leaving a job. Miss it, and you might be stuck waiting for a general enrollment period and carrying the penalty besides.

What to do

A few concrete steps make this entirely manageable.

Well before you turn 65, find out if your employer has more or fewer than 20 employees and confirm in writing how your plan coordinates with Medicare. Your human resources (HR) department or benefits administrator should be able to tell you whether your coverage lets you delay Part B. Do not guess, and do not rely on a coworker's situation, which might differ from yours.

If you're at a small employer, treat your 65th birthday as a real deadline and enroll during your initial enrollment period unless you have confirmed you genuinely qualify to wait.

If you're delaying because of large-employer coverage, mark the eight-month special enrollment period that begins when that coverage ends. Put it somewhere you won't lose it. The moment you retire or drop the employer plan, the clock starts.

Remember that Part D, prescription drug coverage, has its own late enrollment penalty with similar lifetime consequences. If your employer coverage is not considered creditable drug coverage, the same kind of permanent surcharge can apply.

There is one more wrinkle worth flagging, because it catches a particular group off guard. If you contribute to a health savings account, enrolling in any part of Medicare, including Part A, ends your ability to make new HSA contributions.

Part A is premium-free for most people and many enroll in it automatically without thinking, but doing so while still funding an HSA can create a tax problem. If you work past 65, still contributing to an HSA and plan to delay Medicare, that interaction needs to be on your radar.

It's a small detail with outsize consequences and is precisely the kind of thing that gets missed when someone assumes Medicare is a single on-off switch rather than a set of separate decisions.

The bigger lesson

What makes this trap so frustrating is that it punishes inaction by people who weren't being careless, they were just uninformed. There is no investment decision here, no market risk, no judgment call about strategy. It's purely a matter of knowing the rules and the dates, and acting before a deadline that doesn’t announce itself.

If you're approaching 65 and still working, don't let, "I have coverage through my job," be the end of your analysis. It's the beginning of a question, not the answer.

Spend an afternoon confirming exactly how your employer plan interacts with Medicare, and put the relevant enrollment windows on your calendar.

It's one of the rare retirement mistakes that is completely avoidable with a single phone call, and one of the few in which the cost of getting it wrong follows you for the rest of your life.

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Bonds are tempting. The yield on a 10-year Treasury note has increased by a factor of eight in just six years. Do you want to own stocks, which for the past hundred years or so have returned an annual average of 10%, or do you want to own a 30-year bond that was recently yielding 5.3%?

Of course, stocks have returned more on average, but they’re wildly uneven. Since 2000, the S&P 500 Index has returned less than 5% in nine calendar years — including six that were money-losing (one of them down 37%). By contrast, when you buy a Treasury, you're guaranteed to get paid its face value at maturity.

I am a big advocate of stocks for the long run. But the choice isn't binary. Investors can own both — and now they should.

Bond interest rates had been in long-term decline from September 1981, when 10-year notes were yielding 16%, until the summer of 2020, when they dropped below 1%. Rates bounced back after COVID, and since then the direction has been upward. We may be in a new long-term trend in the opposite direction.

It's not hard to understand why. If you own a bond, you want to get repaid in dollars that haven't lost a lot of their value to inflation. But we're now in a period in which inflation seems intractable. Even at 3%, inflation reduces the buying power of $100 to $74 in 10 years. Under such conditions, if you lend money (and that's what you do when you buy a bond), you naturally want a strong yield as compensation.

Then, consider demand. Everyone seems to be lusting to borrow. From 1947 through 2008, the U.S. government ran a deficit of more than 5% of gross domestic product (GDP) exactly once.

Since 2009, there have been 11 such deficits, and the gross federal debt exceeded $40 trillion in August, up from $6 trillion in 2000. Interest on the debt amounts to more than yearly defense spending and accounts for half the annual deficit.

Meanwhile, the giant technology companies that were paltry borrowers in the past are now taking on loads of debt, mainly to pay for data centers. Together, Amazon (AMZN), Alphabet (GOOGL), Oracle (ORCL) and Meta Platforms (META) issued $194 billion worth of bonds in 2026 through July 7, according to an accounting from Reuters, compared with $108 billion for the same period last year.

With all that competition for their money, lenders demand higher interest rates, which in turn means pricier mortgages — which means political trouble. The Treasury secretary said he would buy up America's own long-term debt as a way to reduce interest rates, but that's the kind of desperately clever act that can have the opposite effect.

At the same time, the dividend yield on the average S&P 500 stock has dropped to 1.1% — or 3.7 percentage points below the recent yield on a 10-year Treasury. If you like income, bonds have become exceptionally attractive.

A giant caveat to rising interest rates

But there's a problem. If rates keep rising, as I suspect they will, then the value of a bond you own today will fall. Consider: You buy a 10-year Treasury when it’s issued at 5%. A few years later, the interest rate on a new Treasury rises to 7%.

No one is going to buy your lower-yielding debt at its price when issued. To sell it, you will have to accept a large discount. Of course, you can hold your note to maturity and get full face value at the end of 10 years, but during that time, you are stuck getting interest that's lower than market.

For example, a 10-year Treasury issued in August 2021 with a coupon (stated original interest) of 1.25% and maturing in 2031 was recently trading at around $85 per $100 face value, a discount of 15% from the issuing price. The longer the maturity, the bigger the discount. A 30-year bond issued in 2021 at 2% is trading at $53 — a 47% discount. Ouch.

There are ways to avoid this risk. One is to create a ladder for your bonds. For example, rather than buying one note maturing in 10 years, you can buy five notes, maturing every two years. When the shortest note matures, you take the proceeds and buy a new 10-year note. If rates have risen, the new note will yield more than the one you first purchased.

A simpler approach is to buy shorter-term Treasuries now and wait until rates rise — if they do. The two-year Treasury note is currently yielding a juicy 4.3%.

Or purchase a fund such as Fidelity Short-Term Bond (FSHBX), which also owns corporate bonds. It has a yield of 4.5% and a duration of just 1.9 years. Duration is a term that indicates how much the price of a bond moves when interest rates change. In this case, if rates were to rise by one percentage point, the value of the fund’s portfolio would fall by roughly 1.9%. (Prices, yields and other data are as of August 31 or the latest available.)

Another way to mitigate risk is through buying longer-term bond funds, which themselves own debt of varying maturities. But beware of high expense ratios. One of my favorite choices is the Vanguard Intermediate-Term Bond ETF (BIV), an exchange-traded fund with an expense ratio of just 0.03%.

The fund has a yield of 5.0% and a portfolio split roughly 60-40 between Treasuries and corporates. All the bonds are investment grade — that is, rated BBB- or higher by Standard & Poor's. Roughly three-fifths of the portfolio is rated AAA or AA. The average maturity of the ETF's bonds is 7.3 years, and the average duration is six years.

If you want longer maturities, consider the iShares 20+ Year Treasury Bond ETF (TLT), an exchange-traded fund with an expense ratio of 0.15% and a recent yield of 4.9%. The fund owns only T-bonds, with an average maturity of 25.9 years and a duration of 14.9 years. This is a good time to lean toward Treasuries because the interest spread between bonds issued by corporations and bonds issued by the U.S. government is so low.

I also like iShares Agency Bond (AGZ), which owns AA-rated debt issued by government-sponsored enterprises such as Fannie Mae and Federal Farm Credit Banks, carrying slightly higher interest than straight Treasury bonds of comparable maturities.

Individual corporate issues are not on my wish list. Even the big tech companies are getting overextended as they compete to build their AI businesses. In a June newsletter, Pimco, one of the best bond specialists, warned, "The default cycle is reasserting itself, and … quality and credit selection will matter more than ever."

A big drawback of bonds is that they require more from an investor than stocks, for which you make a single decision: Do I want to be a partner in this company? Buying bonds means weighing such variables as credit risk, inflation and maturity — all affected by something unknowable, which is where interest rates are going, and when.

Still, this is a moment when bonds beckon irresistibly. Don't go overboard. But if you'd like to get returns of 5% from part of your portfolio, with assets that offer ballast in rough seas, well ... now may be the time.

James K. Glassman chairs Glassman Advisory, a public-affairs consulting firm. He does not write about his clients. His most recent book is Safety Net: The Strategy for De-Risking Your Investments in a Time of Turbulence. He owns none of the securities listed here. You can reach him at JKGlassman@gmail.com.

Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.

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