Joseph Eschleman No Comments

Financial Complexities of a Longer Life

Financial Complexities of a Longer Life

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Americans are living longer. That’s the good news. The bad news is that most people aren’t financially prepared. Many Baby Boomers will be in retirement for over 20 years and unfortunately, many aren’t saving and investing with a longer life-expectancy in mind.

There are serious consequences to financial planning around the wrong life expectancy. Some retirees are working later in life; others live in fear of running out of money, while others are leaving less of a legacy than they hoped. No one wants to run out of money in retirement.

How Long Should You Expect to Live?

The Social Security Administration notes that at 65-years old, the average man can expect to live to roughly 84.3 years of age, whereas the average 65-year old woman can expect to live until age 86.6. This means that on average, Americans can expect to spend about 20 years in retirement.

However, there is a strong chance that you should plan to be in retirement much longer than 20 years. One out of every four 65-year olds will live past the age of 90, and one out of every 10 will live past the age of 95. Are you prepared for three decades of retirement? Most people aren’t.

With these figures in mind, here are 4 steps that can be taken to ensure your financial longevity:

Step 1) Develop a Clear Vision of Your Retirement Lifestyle

To create a well-conceived plan and have the will to faithfully execute it, you need a clear vision of your lifestyle in retirement. Start by defining your goals and asking yourself:

  • Where will I live?
  • Where will I travel?
  • What will I drive?
  • How will my hobbies change?
  • Where will I donate my time and money?

It’s important to factor realistic spending assumptions into the cost of your retirement, based on your goals and desired lifestyle. Your plan should also include contingencies for health care costs and unexpected expenses.

Step 2) Address Your Concerns

As we live longer, the trend continues to be to work longer, but oftentimes in a more meaningful and less economically-driven fashion. The act of retiring today is rarely black-and-white, and concurrently, the financial and retirement planning surrounding this life transition is by no means static. As the experience of a major life event takes place, our experience in helping clients in properly coordinating all of their financial affairs has exposed a few common concerns:

  • How do I properly draw income from my various investment accounts once I am no longer saving money?
  • What are the tax consequences of my various retirement income sources?
  • How do I ensure that the retirement income I am taking is sustainable over the next 20, 30, 40+ years?
  • What do I need to do to be confident I will not run out of money before I die?

Step 3) Adjust Your Investment Strategies

Start to plan for a longer retirement by adjusting your investment strategies — like saving more, being slightly more (or less) aggressive with your investment strategy, etc. We ensure our clients have these bases covered, so consider calling us if you’d like someone to review your investment strategies.

Step 4) Consider Your Health Insurance Options

Health insurance is the most expensive and bothersome insurance the average individual carries. Unfortunately, many people approach retirement and believe that the burden of health insurance will be lifted. In reality, even when covered by Medicare and other supplemental insurance plans, there are still substantial costs left for the individual to pay.

In addition to premiums, deductibles, and co-pays, prescription drug costs are likely to rise. In the last decade, the average annual cost of one brand-new drug used to treat chronic health conditions cost a senior $5,800 (2015), compared to $1,800 less than a decade earlier (AARP). Planning for a longer retirement requires keeping a keen eye on the rising cost of healthcare in the US.

Understanding the stresses that come with ensuring your financial longevity, we’re here to help you sort out the complications of an ever-changing financial plan. Contact us to review your retirement, legacy, and estate plans. Together, we’ll create a clear strategy that points you toward a comfortable retirement, whether it lasts one decade or three.

We Are Here To Help

Living a longer life often creates financial complexities. We encourage you to call (916-405-9140) or email ( us with any concerns, questions, or needs you have – we are here for you, and look forward to connecting with, helping, and being a direct, fully independent, and no-strings-attached expert financial resource for each of you.

Disclosures: Towerpoint Wealth is a Registered Investment Advisor. This platform is solely for informational purposes. Advisory services are only offered to clients or prospective clients where Towerpoint Wealth and its representatives are properly licensed or exempt from licensure. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. No advice may be rendered by Towerpoint Wealth unless a client service agreement is in place. No portion of any content within this commentary is to be interpreted as a testimonial or endorsement of Towerpoint Wealth investment advisory services and it is not known whether any clients referenced herein approve of Towerpoint Wealth or its services; nor should it be assumed that any references to our clients are representative of all our clients’ experiences.

Steve Pitchford No Comments

2018 Tax Planning Considerations

By Steve Pitchford, Director of Tax and Portfolio Planning: Tax Cuts: 2018 Tax Planning Considerations

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The Tax Cuts and Jobs Act (TCJA) of 2017 is the most significant amendment to the Federal tax law since 1986, causing drastic changes to both the individual and corporate tax code. Below we describe some of the most pertinent changes and offer tax planning opportunities to consider in response to these changes.

Notable Changes for 2018

By now, most of us are familiar with some of the changes that have taken place at the federal level for both individuals and corporations. On the individual side, one of the most notable differences in 2018 is the removal (or limitation) of many tax deductions. Of special note to those who work in, or who have hired from, the professional service industry (us at Towerpoint Wealth, your CPA, or your estate planning attorney), is the elimination of your ability to deduct professional fees as a miscellaneous itemized expense. And three notable limitations may impact homeowners adversely (especially those in higher tax states such as New York and California) as well:

  • A new cap on the deduction of income, sales, and property taxes to $10,000.
  • The reduction of the interest deduction on mortgage debt. This deduction is now only allowable on debt up to $750,000, down from $1 million previously.
    • This new rule is only applicable to newly originated mortgages taken out after December 15, 2017.
  • Interest paid on a home equity line of credit (HELOC) is no longer deductible, regardless of when the HELOC was established.

With all of this being said, and speaking to how convoluted our tax code was and continues to be (in our opinion), if a taxpayer had previously been subject to the Alternative Minimum Tax (AMT), a separate tax calculation targeting higher income individuals, the elimination of the deductibility of professional service industry fees, and the limitation of the deduction for income, sales, and property taxes may be of little consequence, as these items were considered “preference” items that had already been added back to taxable income for those “qualifying” for AMT.

High Property Tax States Hit Hard

On the whole, taxpayers residing in high property tax states such as California and New York very well may feel more of the sting of the TCJA. New York Governor Andrew Cuomo estimates the new tax act will raise property and income taxes for New Yorkers by 20 percent! California Governor Jerry Brown, commenting on the reduced mortgage interest deduction in particular, stated that this provision would disproportionally affect California.

Not surprisingly, California is leading the charge in considering different approaches to mitigate TCJA’s impact on its residents. Ideas include:

  • Allowing employers to withhold state income taxes as payroll taxes. 
  • Allowing taxpayers to gift their state income taxes to the state, thus making them deductible as charitable contributions.

These ideas being said, there are major hurdles with these approaches, and we feel the likelihood the Internal Revenue Service (IRS) readily accepts them to be quite low.

Planning Opportunities to Consider

Tax Cuts: Understanding the myriad of moving parts associated with the Tax Cuts and Jobs Act of 2017, we here at Towerpoint Wealth continue to be resolute in our philosophy of helping our clients be proactive rather than reactive with their tax planning, and there are still plenty of planning opportunities to consider, obviously depending on your unique tax situation. Examples of proactive tax planning ideas include:

  • Reevaluate which accounts your Towerpoint Wealth professional service and advisory fees are being debited from.
    • These professional fees are no longer tax deductible.
    • Reviewing whether deducting these fees directly from pre-tax retirement accounts (e.g.Traditional IRAs, but NOT Roth IRAs) would be time well spent, as doing so may effectively provide a tax-free distribution from these accounts.
  • Frontload charitable contributions into a single tax year.
    • For those who are charitably inclined, taxpayers continue to receive a federal and state income tax deduction for any donations made to approved 501(c)(3) charitable organizations.
    • The TCJA created a higher standard deduction (doubled for most taxpayers beginning in 2018), and many taxpayers may need to make a more sizeable charitable contribution in order to receive the deduction benefit.
    • One possible solution is frontloading charitable contributions into a single tax year (this would be even more impactful in a year where taxable income may be expected to be higher).
    • Any charitable contributions not applied or “used” in any particular tax year can still be carried forward five more years.
  • Make a Qualified Charitable Distribution (QCD) from your traditional IRA account.
    • Available for those who are 70 ½ years old or older, and subject to required minimum distributions (RMDs) from their traditional IRAs.
    • Rather than make a donation of cash or investments from a “regular” taxable account (i.e. a checking, savings, or brokerage account), a taxpayer obligated to taking a RMD can make a direct contribution from their traditional IRA account to the charity, up to their RMD amount.
    • This is known as a Qualified Charitable Distribution (QCD), which has a dual benefit of both satisfying the taxpayer’s RMD, while excluding the distribution amount from taxable income.
    • From a tax perspective, a QCD has the potential to achieve virtually the same impact as donating funds from a taxable account, but is not subject to the standard deduction “hurdle” as discussed above.

We Are Here to Help

In the end, while the TCJA and the hastily-assembled manner it was enacted left many taxpayers confused and frustrated, we at Towerpoint Wealth believe there are a number of planning opportunities worth evaluating. We understand that “talking taxes” is not everyone’s ideal topic of conversation, yet an important one to be having, and we are here to directly facilitate that conversation and make it less painful as you formulate a tax strategy for 2018 and beyond. If you would like to speak further about any of the topics covered in this article, we encourage you to call (916-405-9140) email (, or Tweet (@twrpointwealth) us.

Towerpoint Wealth No Comments

4 Financial Resolutions to Kick-Off 2018

You’ll Thank Yourself a Year from Now: Financial Resolutions

With New Year’s right around the corner, it is the perfect time to make resolutions before the calendar flips to January 1. The 7th Annual New Year’s Resolution Survey found that many resolutions made last year were focused on faith, family, and personal wellness. Unfortunately, financial stability trailed far behind, with only 29% reporting financial considerations in their New Year’s resolutions. We are hoping to change that this year by providing the top four financial resolutions to make for 2018:

Financial Resolution #1 – Diversify Your Income Streams

Does the bulk of your annual income come from one source? Is there one slice of the pie that dominates your other income sources? It is almost always a good idea to diversify your income streams as much as possible so you are not overly dependent on one particular stream for greater than half of your income.

Create a tangible game a plan to grow other income streams so that you increase your overall income and decrease your reliance on any one particular source. This resolution is all about establishing financial security so you are prepared, and not surprised, if something happens to your primary income stream.

Financial Resolution #2 – Get Organized and Stay Organized

Organizing your finances may be a task that easily gets put on the back-burner, especially when juggling multiple priorities. There are plenty of online tools that make it easier than ever to get organized and stay organized. Here are a few of our favorites:

Mint: Mint shows you your balances, lets you pay your bills, track your investments, and more—all in one place.
Shoebox: Shoebox helps you digitize and organize all of your receipts; plus it archives everything and is completely searchable.
Buxfer: If you share costs with family members or significant other, Buxfer allows you to neatly split expenses, create budgets and bill reminders.

Another helpful tip for staying organized is to divide your financial documents between short-term and long-term. Short-term documents could include files from the past year, such as bills, statements, tax receipts, health records, etc. Long-term files could include income tax records, inheritance papers, legal documents, reports from trusts, birth certificates, Social Security cards, physical stocks and bonds, mutual funds statements, etc. Use the filing system that you think works best for you and stick to it!

Financial Resolution #3 – Stop Neglecting Your Insurance Policies

Although most people do not do this, it is a very good practice to review your insurance policies annually. What better time to make this happen than with the change of the New Year? Review your auto insurance, homeowners’ insurance, life insurance, business, and even umbrella policies. The umbrella policy is particularly important to focus on because, as your net worth increases, your exposure to a lawsuit increases as well. Check for lapses in any of your coverage and make sure you are not overpaying for a coverage that might be more affordable somewhere else.

Beyond insurance policies, take a look at your wills or estate plans. Your beneficiaries or assets may have changed, so update these plans to ensure your will or estate plan remains accurate and reflective of your true intent.

Financial Resolution #4 – Perform a Thorough Retirement Check-Up

Finally, meet with your financial advisor to review your retirement plan (assuming you already have one). With a complete understanding of where you stand with your retirement savings, it is possible you will find places to improve and/or gaps to close. Review how much you have saved, how much you are adding each year, and whether you will end up with enough in your “retirement nest egg” if you continue your present course. US News recommends tweaking your retirement savings by boosting it in the New Year if possible.

Your financial stability impacts both your physical well-being and the well-being of your family. As you set your resolutions for the New Year, keep in mind these four important financial resolutions and check-points.

Curious if you would benefit from a comprehensive and personalized year-end financial audit? We are here for you, and welcome sitting down with you to discuss your circumstances further. To schedule a complimentary and confidential initial discovery meeting, call (916-405-9140) or email ( us today.

Joseph Eschleman No Comments

1. The Negotiation

The Negotiation:

Apparently, if you are a kid born around the Chrismukkah wintertime holidays, half-birthdays are important. Josephine, my ten and a half year old daughter, brought this to my attention just last week as she accompanied me on a father-daughter walk two blocks from home in Curtis Park down to Gunther’s Ice Cream to enjoy a double-scoop of vanilla. It is common knowledge that the overall quality of ice cream is measured by how good the vanilla is, and for most Sacramentans, it is common knowledge that Gunther’s vanilla unquestionably continues to set the bar for any vanilla we taste anywhere.

Me, at ice cream shop ABC in city XYZ: “Is it good?”

Josephine: “Yeah, but it isn’t Gunther’s good.” 

We have made this two-block walk to Gunther’s dozens of times, but what made this specific trip different was the context of it. This was the first time Josephine was going to buy her own ice cream.

In working continually to teach my two children (my son Henry is seven, and is also in full agreement that Gunther’s vanilla is the gold-standard of all ice cream worldwide) the myriad of skills necessary to survive in this crazy world we live in, negotiation and finances both rank highly on the list. Being the children of a financial advisor, this should not come as a huge surprise, but what I continue to find amazing is that many kids seem to have no idea about either area. And when I say kids, I don’t just mean elementary school kids, I mean junior high, high school, and even college-age kids.

As most of us should or already do know, a negotiation can be deemed “successful” if both parties feel they obtained a benefit as a result. And it is common knowledge that you typically have to give something to get something. The fun is the art of the dance. However, win-win is not the definition of negotiation, it is only the goal. Fortunately, my walk down to Gunther’s with Josephine was a product of a successful negotiation, which as any parent can attest, is not always the outcome. Subsequent to being presented with her half-birthday data point, I was propositioned by Josephine to go to Gunther’s to celebrate. Leveraging this “fact” was a stretch, for sure, but I appreciated her spirit in asking and attempting to take advantage of her perceived half-birthday negotiating currency. One life rule both Eschleman children should know is to always ASK if you want something, and do not assume the answer is no, because you never know when you will catch someone in a good mood or at a moment of weakness.

I considered what she proposed for a moment and tried to remain unbiased in my response, which is difficult to do if you have had Gunther’s ice cream. Then, my response dawned on me, and I said with just a slight grin, “Sure, we can go to Gunther’s, but only if we go Dutch.”

The look on Josephine’s face did not let me down, as I was hopeful she had no clue what I was talking about. Pleased with myself for taking advantage of the situation to educate her on what “going Dutch” means, she pondered my counter-offer for only a few moments, as quick decision-making, for better or worse, is also an Eschleman personality trait – “OK Dad, let’s do it.”

Towerpoint Wealth Blog : Going Dutch

Joseph Eschleman No Comments

2. Jobs


Like most American households, the Eschlemans are regularly on the go with various activities and responsibilities, and while busy, try to lead satisfying and fulfilling and lives. However, one of the consequences of this busy schedule is having only limited time to attend to normal household responsibilities, or, as they are more commonly known, chores.

Having a desire to impart as much responsibility as we feel they deserve and are able to assume, my wife Megan and I have become diligent in ensuring that both Henry and Josephine fulfill their responsibilities as contributing members of our household. While “chores” has been rebranded to “jobs,” the goal remains the same – engendering a sense of accomplishment in both of them, as well as cultivating the importance of teamwork and affording them the opportunity to begin to see themselves as important contributors to the family.

We did not receive the parenting guidebook when either of them was born, so hopefully some of this is sticking. However, there is another major lesson with this “jobs” program I would like to instill and cultivate in both Henry and Josephine – fiscal savvy and responsibility.

On the fridge in the kitchen, Henry and Josephine each have their “job chart” – nothing fancy, just six rows of jobs, and seven columns for each day of the week. The goal is to have each of them receive a star for completing each of their six jobs on a daily basis (42 total possible stars every week). Yes, for Megan and me it can be a job in and of itself just helping the kids stay on task to complete as many of their jobs as possible.

Towerpoint Wealth Blog : Going Dutch

Joseph Eschleman No Comments

3. Payday


As is true with all of our schedules, life can and will get in the way of our jobs regularly enough, and it is rare (but not completely unprecedented) for Henry and Josephine to have a perfect week, but that is always the goal. And, to help them equate working harder with getting paid more, the scoring system (or compensation agreement, depending on how you look at it) works as follows:

  • Each star (job) is worth in cents your age. Josephine is ten, so she gets $0.10 per star (job completed). “Tenure” in the Eschleman household is rewarded, and the jobs also get more difficult and time-consuming as you get older.
  • If you accumulate a minimum of 27 stars in any one particular week, you earn a $0.50 bonus. This 27 star threshold is completely arbitrary.
  • If you have a perfect week, you receive a $5.00 bonus!

For example, last week Henry completed 35 jobs (a darn good week), and earned $2.95 (35 x $0.07, plus $0.50 bonus for 27 star benchmark). Payday is on Monday mornings.

We try to vary and switch-up the jobs every so often to keep things fresh, and we entertain Henry and Josephine’s input on the jobs as well.

Towerpoint Wealth Blog : Going Dutch

Joseph Eschleman No Comments

4. Save, Spend, Donate

Save, Spend, Donate

OK. So Henry and Josephine now have the forum to earn, which logically then leads to the transition into the next lesson: what to do with it. This is a lesson many of us are still working to learn, and why Megan and I feel it is important to cultivate these skills early in life. We are trying a simple four-“bucket” program to instill in Henry and Josephine the main goals that having money helps them to meet:

  1. Save
  2. Special Save
  3. Donate
  4. Spend

Subsequent to getting paid on Monday mornings, both kids then decide for themselves (with very slight coaching from Dad) how they want to allocate their hard-earned cash. They can choose to put more or less in each of their two banks (save, donate) and wallet (spend) as they wish, predicated by the rule that SAVING COMES FIRST. 

Ask either of them “What do we first do with our money?” and their answer will invariably be “Save it.”

Intermittently, we tally how much they are saving and keep a running number. Cultivating a personal net-worth-building attitude and habits early in life – huge!

“Special Save” is a rudimentary 401(k)-type matching program. Special save is meant to help each kid tuck money away for a specific longer-term item or goal that is important to them. For Henry, it is a new mini-Cooper Lego set; for Josephine, it is a new flat-screen TV for her bedroom. Whatever funds the kids decide to allocate to Special Save, “the house” matches dollar-for-dollar. It has been enjoyable to witness Josephine’s flat screen TV research, as she is close to making a buying decision, and the exercise in weighing features, costs, and benefits has been a good one.

Donate. Instilling in Henry and Josephine the importance of giving and of helping others less fortunate is paramount for Megan and me. Intermittently, we take a field trip to whatever charity they have chosen and donate the funds directly on-site. The impact these trips have had on them has been tremendous, not to mention the sincere “thank-yous” and gratitude expressed verbally, and in written form, by the various “qualifying” charities Henry and Josephine have selected over the years.

And finally, the fun part – spending! Henry and Josephine get to do whatever they want with their spending money, no strings attached. Candy, Pokémon cards, slime, dart guns, whatever. If they have the money, they can buy it. Because after all, Henry buying a pack of Pokémon cards is no different than me buying an $8 bottle of Panic IPA, and Josephine’s slime purchase might as well be Megan’s latest new pair of shoes. What fun is life if we only prepare for the future, and don’t get to live in the present as well? Plus, having spending money of their own, that they earned themselves, hopefully helps both kids equate the money they have to the hard work they did to earn it, and also gives them the financial freedom of knowing that their spending money is theirs to do with what they please. Even if it means going Dutch with your Dad at Gunther’s Ice Cream.

Towerpoint Wealth Blog : Going Dutch