investment strategies

By Archford Capital Strategies, AdvisorHub

1. Convert an IRA to Roth IRA

The balance of your current IRA is probably lower compared to the beginning of the year. You can convert some, or all, of the investments inside your Traditional IRA to a Roth IRA.

Those investments should have time to recover inside a Roth IRA where that appreciation would be tax-free. Note: you will have to pay ordinary income taxes on the value of the investments on the day the Traditional IRA is converted to a Roth.

2. Consider reducing the long-end of a bond ladder

Most long-term bonds have seen a jump in value. It’s hard to imagine there is much upside room given where interest rates are. Also, consider margins against these if you need liquidity short-term as rates are low. There are a lot of bonds being sold so pricing should be better in a couple months.

3. Reduce or eliminate high-yield bonds

These are the companies that could have a difficult time paying their debt with significant business interruption.This also assumes you view high-yield bonds as a risk-reduction element in your portfolio. We do not like them currently as a yield enhancer to fixed income portfolio because of principal risk. If you are using in a portfolio then consider as equity risk.

4. Quicken the pace of your dollar cost average investment plan

If you have a plan to invest cash over the next 12 months, consider speeding that up.

5. Refinance your home or other debt

Review the interest rate on your mortgage to see if it makes sense to refinance. I have a feeling many people are doing this right now so you may need to be patient with the lender. Also, business owners should look into new SBA lending programs.

6. Accelerate the funding of retirement accounts

If you normally contribute to SEP, 401(k), IRA accounts or Education Savings Plans, contribute now to buy more shares at a lower price.

7. Take advantage of the tax extension

Take advantage of the IRS tax extension from April 15th to July 15th.Preserve your cash if you owe until the filing date.

8. Family gifting

Remember NOT to give family members assets with a loss (better to sell the asset yourself so you can preserve the tax loss)… then give the money. Note: If you are giving assets to family members when the market is down, then you can give more shares of the security.

9. Charitable giving

If you or your spouse are over 70.5 years of age use your traditional IRA for charitable gifts. If you are over 70.5 years of age and know your children are philanthropic, this may be a good year to contribute on behalf of your child to their charity.

Again, you should never give a security to a charity where you have a loss. Sell it first and realize the loss for tax purposes. People under 70.5 should use their donor-advised fund this year for gifts.

The donor-advised fund investment strategy is probably more conservative than the assets you contributed to the fund. This also preserves your personal liquidity. One may postpone gifts of securities until the end of the year.

Often when there is a sharp pull back in the market the recovery can be quite swift. There has been a lot of reference to this pullback in the market and the 1987 “crash” but remember the market was positive for the year at the end of 1987.

10. Pull cash from your line of credit

Consider this strategy whether or not you need the money. We have seen banks reduce lines of credit in the past on the unused portion at a time when you could need it most.

11. Consider strategic tax moves

If your business income will be down then review the new marginal tax rates to potentially make additional strategic tax moves.

12. Take a look at a sale-leaseback

If you own your building, take a hard look at a sale-leasebackespecially now with the current interest rate environment. A sale-leaseback is when you sell the building that your business occupies and then sign a long-term lease to rent it back.

This could provide additional liquidity that could be put to work in other areas of your business. This also can help diversify the overall percentage of assets you have tied directly to the business.


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Lawton Retirement Plan Consultants, LLC (LRPC) is a Milwaukee, Wisconsin-based independent, objective Registered Investment Adviser (RIA) providing investment advisory, fiduciary compliance, employee education, provider management and plan design services to employer retirement plan sponsors. The firm specializes in Socially Responsible Investment (SRI) strategies for retirement plans and is a pioneer in the field. LRPC currently has contracts in place to provide consulting services on nearly a half billion dollars in plan assets. For more information, please contact Robert C. Lawton at (414) 828-4015 or or visit the firm’s website at Lawton Retirement Plan Consultants, LLC is a Wisconsin Registered Investment Adviser.

Important Disclosures

This information was developed as a general guide to educate plan sponsors and is not intended as authoritative guidance, tax, legal or investment advice. Each plan has unique requirements and you should consult your attorney or tax adviser for guidance on your specific situation. In no way does Lawton Retirement Plan Consultants, LLC assure that, by using the information provided, a plan sponsor will be in compliance with ERISA regulations. Investors should carefully consider investment objectives, risks, charges, and expenses. The statements in this publication are the opinions and beliefs of the commentator expressed when the commentary was made and are not intended to represent that person’s opinions and beliefs at any other time. The commentary does not necessarily reflect the opinion of Lawton Retirement Plan Consultants, LLC and should not be construed as recommendations or investment advice. Lawton Retirement Plan Consultants, LLC offers no tax, legal or accounting advice and any advice contained herein is not specific to any individual, entity or retirement plan, but rather general in nature and, therefore, should not be relied upon for specific investment situations. Lawton Retirement Plan Consultants, LLC is a Wisconsin Registered Investment Adviser and accepts clients outside of Wisconsin based upon applicable state registration regulations and the “de minimus” exception.