December 2020 Financial Planning & Investment Newsletter

by Michelle Smalenberger, CFP® / December 17, 2020

Financial Planning & Investing December 2020

In This Issue: Financial Planning & Investing

Each month we cover Financial Planning & Investing topics that apply to you.  We cover a variety of topics to point out timely information that applies to you!

Investing: Recapping 2020 Returns for Investors and Looking Forward to 2021

2020 was an interesting year. That’s stating the obvious, but for investors it truly was interesting to see how investments performed throughout the year. While it’s always important to stay focused on what’s ahead, there’s value in recapping 2020 investment returns for investors before looking forward to 2021.

After the S&P 500’s +31% gain in 2019, few people imagined the stock market would continue to power ahead. COVID tried to ruin the party in the Spring, sending the index down 35% from mid-February to the end of March. But things quickly recovered, and the market was making new highs just a few months later.  Read the rest of the article here.

Tax Planning: Charitable Giving Reminders for 2020

[VIDEO] One light can put off some light, but imagine stringing a bunch together like on the Christmas tree here behind us. The light starts filling the room.  The room starts glowing. And that’s just like you and I.  When we do things on our own it’s good, but when we start working together as a team that’s really when we start to shine our brightest.  Is charitable giving one of the things still on your to-do list? Learn how you can make a bigger impact with these final reminders.  Read about these final reminders.

Financial Planning: A 2020 Charitable Giving Strategy You Don’t Want to Miss! 

It’s been a tough 2020. And not just for individuals and families, but for charitable organizations as well. The coronavirus pandemic not only affected a charity’s ability to perform its charitable duties, but funding levels as well. As we head into year-end, it’s a good time to remind ourselves that the government created a special $300 charitable giving benefit for 2020 that’s available to ALL taxpayers. 

The CARES Act Created a Special $300 Charitable Deduction for 2020.  One change they made was to allow taxpayers to take an above-the-line deduction for charitable contributions made in cash. They limit this deduction to $300 for 2020, but normally taxpayers only get a benefit for charitable giving if they itemize deductions on their tax returns.  Read about this strategy more people that normal can benefit from.

Financial Planning: What is a Self-Directed 401(k)?

If you have a 401(k) through your employer you know that very commonly we actually have investment choices.  Let’s say you can choose between a bond fund, a stock fund that has some growth stocks or value stocks, and then an international stock fund.  Your plan provider is required to give you a variety of fund types to diversify between. This is very typical with your 401(k).  In addition to these choices you may have a self-directed 401(k) to choose from too.

A self-directed 401(k) is more common than you think.  We have been finding more and more plans that give you this additional investment option rather than choosing from the pre-picked funds.  These can be called different things such as a self-directed 401(k), or a self-directed brokerage account; it can be called different things.   Read about this investment option you might have available to you inside your 401(k).

Grab your copy of our December Monthly Newsletter by clicking below!Financial Planning & Investing, Fee-only financial advisor, chicago, barrington

If you’d like to catch up on last month’s November 2020 Newsletter you can grab that at this link!

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Michelle Smalenberger, CFP®

I have a passion for helping others develop a path to financial success! Through different lenses on your financial picture, I want to help create solutions with you that are thoughtful of today and the future. I have seen in my life the power of having a financial plan while making slight changes of direction from time to time. I believe you can experience freedom from anxiety and even excitement when you know your finances are on track.