Financial Planning
Financial planning is an extension of the annual tax process for our clients. We answer questions all year around about financial problems and solutions and assist with investment planning and securities advisement for tax clients. I have a current professional NASD and California licenses in Securities and Insurance.
INSURANCE ANNUITIES
There are basically two kinds; the fixed account, and the account indexed to the stock market in a hundred different ways. The fixed account guarantees a minimum amount of earnings [think interest] and the other goes up and down with the stock market. It is an insurance product which will guarantee the initial purchase price if you die, even if the invested stock market value [think Dow Jones Industrials] goes to Mexico. There are charges to cover the administration, the mortality issue, and especially the commissions to sell the product. The account can be funded for IRA or non-qualified investment. Earnings, unlike interest on a savings account, are not taxed until money is withdrawn.
This is a great long-term investment and quite safe because California requires large investment reserves of insurance companies doing business in this state. Penalties are imposed on a declining scale for withdrawals made for the first five to ten years. There was a period where only security broker-dealers could sell an insurance product indexed to the stock market or their advisers, but recent legislation by the SEC have relabeled the product as a non-security. Annuities are a good investment made for large initial deposits, routine savings, and pensions. Withdrawals are usually made at retirement age to supplement Social Security or other pensions.
SECURITIES AND REGISTERED INVESTMENT ADVISORY
For twenty years I held many security licenses with the NASD, SEC, and California. I have parked these [both sales and management] licenses recently but they are still current. The reason I mention this is that I have great depth in the taxation of securities and bonds because of my Investment Advisory experience. And my advice is always beyond taxes.