Our “Off The Wall” Blog
is now Monument #Unfiltered

Subscribe below to receive our unique, straight-forward, unfiltered wealth advice delivered straight to your inbox.

Finding the Silver Lining: 8 Wealth Planning Opportunities

Finding the Silver Lining- 8 Wealth Planning Opportunities

If you’re like me, you’ve been seeking out the silver linings in these unprecedented times. Albert Einstein said it most succinctly: “In the middle of difficulty lies opportunity.” And that’s certainly true for your finances. Markets may be volatile, your plans for the future may be uncertain, but there are wealth planning opportunities to be had.

Consider these eight silver lining opportunities, which we assess for each of our clients, to improve your wealth plan.


1. Avoid a future pit in your stomach: have cash on hand.

You’ve heard the phrase “cash is king,” and nothing reinforces that more than seeing your portfolio take a dive. If you know you have a need for funds in the next 12-18 months—say for taxes, home improvements, or retirement—then have that money set aside as cash. Don’t assume you can just take it from your portfolio when you need it, because, as we’ve seen, market conditions can change quickly and you want to avoid withdrawing money from your portfolio when your accounts are down.


2. Revisit your risk tolerance.

When a market pullback is hypothetical, it can be easy to think you are comfortable with high levels of risk and volatility. It’s not so easy when that market pullback is real. Did the market dip in December 2018 or the unprecedented sell-off in March 2020 make you question your allocation or think about selling? If the answer is yes, then you should revisit how much risk you’re actually comfortable taking, as well as how much risk you really need to take to achieve your goals—it may not be as much as you think.


3. Consider a Roth conversion.

If you’re considering converting a portion of your tax-deferred IRA money to after-tax Roth IRA money, it could be a good time to do so during a market drop, especially if you’re considering converting a large portion of your IRA. Essentially, converting while an account value is down creates more tax-free growth when markets recover. Check out “Three Reasons It’s Time to Reconsider Roth Conversions” for more wealth planning insight into why you many want to consider a Roth conversion.


4. Max-out your tax-deferred accounts when the market is down.

Most of us who have employer-sponsored tax-deferral plans through work—primarily retirement or health savings accounts—tend to make equal contributions each month, but when the market takes a big hit, it’s a smart time to see if you can “front-load” your contributions for the remainder of the year. Doing so will give you more tax-deferred growth when markets recover. (Though, be mindful of your employer’s rules around matching contributions to make sure that front-loading an account won’t make you miss out on any matches.) If you’re making contributions to an IRA account for 2020, max-out that contribution when the market is down as well.


5. Refinance your loans.

Interest rates have been declining for the last few years, so you may have already taken advantage of refinancing your loans and/or mortgage, but if not, now is a great time to consider it—mortgage rates are at historic lows. While you will pay closing costs to refinance a mortgage, if you haven’t revisited your rate in a while your monthly savings could be significant.


6. Check the beneficiaries on your retirement accounts.

The SECURE Act, signed into law in December 2019, changed the rules on how long non-spouse beneficiaries have to take money out of an inherited IRA, shortening that period from the beneficiary’s lifetime to ten years. Concerned about your child having to take out a large retirement distribution? Consider this idea (of course within the broader context of your overall estate plan): rather than listing your spouse as 100% primary beneficiary and your child as 100% secondary beneficiary, list your spouse and your child each as 50% primary beneficiaries; this way your child will have two 10-year periods to take their required minimum distributions from the account, once when they inherit the IRA from you and then again when they inherit the remaining IRA balance from your spouse.

[To learn more, read “How the new SECURE ACT may affect you“]


7. Take a fresh look at your estate documents.

Why not use all this extra time at home to refresh your estate documents?! (I know, exactly what you want to do—and parents with young children at home are definitely rolling their eyes at the thought of “extra time.”) If you don’t have estate documents or your documents haven’t been updated in a long time, this should be reason enough to reach out to your attorney. (Call us if you need a recommendation.) But, in particular, if you have a trust listed as a beneficiary of your retirement account, your attorney should review your trust language. For instance, if your trust is written as a conduit trust, you could be unintentionally creating problems for your beneficiaries in light of changes made through the SECURE Act, potentially forcing them to take their full distribution from a retirement account in one year rather than stretching out their required distribution over ten years.


8. Consider a GRT.

A Grantor Retained Trust (GRT) is a type of trust used to transfer assets from one family member to another over time while giving the grantor an income stream during the trust’s term. The trust allows you to transfer assets at a discounted gift tax value and removes future appreciation of those assets from your estate. So why is now the time to consider setting up a GRT? Because the Section 7520 rate is at an all-time low of 0.60% (as of June 2020). The IRS uses this rate to determine the value of the income stream you receive during the trust’s term, which then determines the value of the gift being transferred to your heirs. Essentially, because the 7520 rate is so low, you can transfer a large amount of assets out of your estate while using a smaller amount of your lifetime gift tax exemption. There are a lot of important wealth planning considerations with GRTs—for example, transfers to a GRT are irrevocable and, to be successful, you must outlive the term of the GRT—but it could be a beneficial strategy if you’re facing a potentially large estate tax bill.


A true Private Wealth Design is co-created. Masterminded. Crafted. Envisioned. At Monument, we create yours based on honest, thoughtful, considered conversation, and it’s as much a result of design thinking as it is logical thinking. The way we see it, this is creative work. That’s because there is no linear answer or checklist to adequately answer the question “what do you want your life to be?”

So, give us a call and let’s talk about whether any of these wealth planning opportunities could be right for you.


Jessica L. photo

Jessica L. Gibbs, CFP®

Vice President & Partner

Jessica was inspired by a podcast to become a financial planner. At the time, she was working at the Brookings Institution as part of their fundraising team. Even though she enjoyed working with individuals on their philanthropic giving, Jessica decided that wealth management was a better way to build the type of long-term, advice-driven relationships she values. After completing Georgetown University’s Certificate in Financial Planning program....

Learn more ...

Stay up to date!

Subscribe to our “Off the Wall” Blog for articles and videos on all things wealth management, by all members of our Team. Unlike Facebook, we will never share your data with anyone.


Please remember that past performance is no guarantee of future results.  Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Monument Capital Management, LLC [“Monument”]), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful.  Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions.  Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Monument. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. No amount of prior experience or success should be construed that a certain level of results or satisfaction will be achieved if Monument is engaged, or continues to be engaged, to provide investment advisory services. Monument is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice.

A copy of Monument’s current written disclosure Brochure discussing our advisory services and fees is available for review upon request or at www.monumentwealthmanagement.com/disclosures. Please Note: Monument does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to Monument’s website or blog or incorporated herein, and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.

Historical performance results for investment indices, benchmarks, and/or categories have been provided for general informational/comparison purposes only, and generally do not reflect the deduction of transaction and/or custodial charges, the deduction of an investment management fee, nor the impact of taxes, the incurrence of which would have the effect of decreasing historical performance results.  It should not be assumed that your Monument account holdings correspond directly to any comparative indices or categories. Please Also Note: (1) performance results do not reflect the impact of taxes; (2) comparative benchmarks/indices may be more or less volatile than your Monument accounts; and, (3) a description of each comparative benchmark/index is available upon request.

Please Remember: If you are a Monument client, please contact Monument, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services.  Unless, and until, you notify us, in writing, to the contrary, we shall continue to provide services as we do currently. Please Also Remember to advise us if you have not been receiving account statements (at least quarterly) from the account custodian.