Enjoy the current installment of “Weekend Reading For Financial Planners” – this week’s edition kicks off with the news that Republicans in the House of Representatives this week released their long-awaited tax plan to address the impending sunset of many measures in the 2017 Tax Cuts and Jobs Act. The proposed legislation makes several aspects of TCJA ‘permanent’, including maintaining TCJA’s tax brackets and the elevated estate tax exemption, while also introducing new potential tax-savings opportunities (though some of these are limited by income and/or are temporary), including increasing the cap on deductibility of State And Local Taxes (SALT) and allowing for the deductibility of some interest on loans for motor vehicles whose final assembly takes place in the United States. Notably, though, this legislation is subject to change as it appears headed for a vote in the full House and as the Senate considers its own version of the tax legislation.
Also in industry news this week:
- A recent study finds that financial advisory clients are leaving largely positive, in-depth reviews for their advisors
- FINRA has responded to some concerns about its proposed rule regarding outside business activities, saying that it is designed to streamline regulations and not (as has been suggested by some commenters on the proposal) impose additional burdens on unaffiliated RIAs that conduct certain business with broker-dealers
From there, we have several articles on investment planning:
- Four trends to watch in 2025 when it comes to mutual funds and ETF fees, from the continued decline in average fund fees to the increasing number of complex, higher-fee ETFs
- Amidst fee compression for other fund types, many money market funds continue to charge elevated fees, creating an opportunity for financial advisors to identify the best options for their clients
- How the index providers chosen can affect the fees and composition of index funds, which can differ even among those with similar investment objectives
We also have a number of articles on education planning:
- How advisors can help their clients identify the best 529 plan option from their needs, from identifying the tax benefits available in their state to considering whether a plan from another state might be preferable
- The pros and cons of four alternatives to 529 plans for education savings, including taxable brokerage accounts and Roth IRAs
- How families can use 529 plans to support education spending needs across multiple generations
We wrap up with three final articles, all about financial advice:
- Why standard “good” financial advice might be different than “effective” advice that meets a client’s personalized goals and preferences
- While it can be tempting to optimize one’s personal finances, building in “room for error” can offer both psychological and financial benefits
- Experimental research demonstrates the downside of delayed gratification, as some individuals might never find the ‘right’ time to enjoy something deemed special
Enjoy the ‘light’ reading!
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