Our February 2025 Newsletter: The 3 Documents Everyone in Retirement Needs

February 07, 2025

The 3 Documents Everyone in Retirement Needs

The #1 question we are asked by clients is “How can I avoid probate and keep from having courts involved in my affairs and making decisions for myself & my family?”

The answer is with an estate plan.

What should that plan include? There are 3 documents everyone in retirement needs:

1. Will: This document communicates your wishes after you die – specifically who assumes ownership of your assets. If you do not have a will in place at the time of your passing, your assets will be distributed in accordance with your state’s intestacy laws.

2. Durable Power of Attorney: A Power of Attorney (POA) document allows someone you’ve chosen to handle your legal, medical, or financial decisions. A Durable POA document includes specific verbiage making it effective even if you become medically incapacitated; for example: cognitive decline, medical emergencies, etc. Please note that there are two types of Durable POAs, one for financial matters and one for medical matters, and they are generally two separate documents.

3. Healthcare Directive / Living Will: A Living Will details your wishes for medical care at the end of your life should you become unable to communicate. This document guides your loved ones and medical providers in making difficult decisions without having to guess what you would have wanted.

Other planning suggestions we have are:

· Define your beneficiaries. This ensures assets will go directly to your beneficiaries after you die, outside of probate. Since beneficiary designations supersede instructions in your will or living trust, it’s crucial they are correctly named. Contact our office to confirm or update your beneficiaries.

· Gather all your important documents into one safe place and let your beneficiaries or POA know where they’re located.

· Consider including a list of all your assets and online accounts. Your POA will likely need login info and passwords to access these accounts.

Having an estate plan in place can help you feel more confident about the future and helps ensure your loved ones are cared for, your wishes are honored, and your legacy is protected.

NVIDIA has Joined the Dow!

AI chipmaker Nvidia has officially joined the Dow Jones Industrial Average, replacing its struggling counterpart Intel. NVIDIA joined the Dow to ensure maximum representation of the expanding semiconductor industry.

The Dow Jones Industrial Average (Dow) is a stock market index that tracks 30 large, blue-chip companies trading on the New York Stock Exchange (NYSE) and Nasdaq. A blue-chip company is a nationally (or internationally) recognized, well-established, and financially sound company that is publicly traded.

The Standard & Poor’s 500 Index (S&P) is a prominent market-capitalization-weighted index of 500 leading publicly traded companies in the US. A capitalization-weighted market index has individual components whose influence is based on their market cap, or their total dollar market value of that company’s outstanding shares of stock.

The Dow Jones Industrial Average (Dow) and the Standard & Poor's 500 Index (S&P) are two of the most widely followed American stock market indexes.So why do we recommend tracking the S&P over the Dow? In short, the S&P is favored for long-term growth, stability, and diversification.¹ Because the S&P has 500 of the largest companies in the US, we believe it provides a more accurate picture of the economy, versus the Dow which only has 30 companies. The S&P is also more diversified than the Dow, since its stocks represent all sectors of the economy while the Dow does not include utilities and transportation.

Source: Investopedia.com 1 There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.

Did You Know: S&P 500

· The first S&P Index was launched in 1923 as a joint project between the Standard Statistical Bureau and Poor’s Publishing and covered 233 companies.

· In 1941 the two companies merged and became Standard and Poor’s – a credit rating agency.

· The S&P 500 we know today was launched in 1957.

· Since its inception, the average annual return is 10.13% (6.37 after inflation) - creating significant gains for long-term investors.

Source: investopedia.com

When to Expect Your LPL Financial Tax Forms

As we enter tax season, the question on everyone’s mind is “when can I expect to receive my tax forms in the mail?”

Here’s a guide to when your LPL Financial tax forms will be mailed, but please note that if you’ve elected to receive paperless tax forms, you’ll need to access them through Account View.

· 1099 Q/R – for any retirement account distributions or qualified tuition programs and ESAs

· Were mailed January 17^th

· Consolidated 1099 Tax Statement - Tax form reporting income and transactions for non-retirement accounts (i.e., Individual, Joint, TOD, Trust)

· During the 2024/2025 tax season, LPL will mail 1099 consolidated tax statements in multiple waves (similar to other major financial firms) to meet all IRS deadlines, reduce errors, and cut down on the need to mail corrected forms.

· January 17 & 24 & 31: Accounts with the simplest tax information and not subject to income reclassification

· February 7, & 14: Accounts holding more complex securities, for which issuers provided final tax information after January 26

· February 21, 28, & March 7: Accounts where security issuers did not furnish tax information to LPL Financial in time for the anticipated February mailing deadline

· If your 1099 consolidated tax statement is not available on or before February 14, 2025, you’ll have access to a Preliminary 1099-Consolidated Tax Statement. This is an advanced draft only. Data may be incomplete and is subject to change. The preliminary 1099 should not be considered final and should not be used for the purpose of filing a tax return with the IRS or with any state or other regulatory agency. The preliminary form will be available electronically and won’t be mailed.

· Form 5498 IRA - this shows contributions made to your IRA including any rollovers in 2024. This form is informational and not needed to file your tax return

· February 21 & May 23

You can read the full December Statement Insert: Getting Ready for the Upcoming Tax Season from LPL Financial here. If you have any questions about your tax documents, please don’t hesitate to contact us at 518-584-2555.

It's A Flurry of Fun this February!

Whether you like the cold weather and getting out and enjoying the snow, or prefer to stay inside where it’s warm, Saratoga has something for everyone to enjoy this month!

Don’t miss the 26th Annual Chowderfest happening Saturday February 8^th from 11:00 am – 4:00 pm.

Join thousands of dancers and music enthusiasts for a weekend filled with traditional and contemporary participatory dancing, singing, concerts, workshops, and family-friendly events at the 2025 Flurry Festival February 14^th – 16^th.

February 26^th is the beginning of Saratoga County Restaurant Week!

Click here to view the entire calendar of events for February!

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly. This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.