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Will EVs Rise Mean Combustion’s Demise? 08.27.2021

Big Oil. A somewhat-pejorative name used to describe the world’s six largest publicly traded oil and gas companies:


BPChevronExxonMobilRoyal Dutch ShellTotalEnergies, and ConocoPhillips.

BP, Chevron, ExxonMobil, Royal Dutch Shell, TotalEnergies, and ConocoPhillips

These “supermajors” are facing intense challenges, specifically to their oil reserves and production. Pressure to cut back traditional upstream spending and redirect capital into renewable energy projects is intense, which we believe will drive oil supply down and oil prices higher.

Renewable svs Oil and Gas

Oil production growth outside of OPEC+ has been extremely difficult to achieve, and recent ESG pressures have exacerbated these problems. In what the New York Times dubbed a “stunning defeat” for ExxonMobil, and a huge win for ESG proponents, activist investor Engine No. 1 secured three new directors (out of 12 total) to ExxonMobil’s board of directors, with a specific mandate to reduce the company’s carbon footprint by curtailing capital investments into its upstream oil and gas businesses. At about the same time, a Dutch court ruled that Royal Dutch Shell must cut its CO2 output by 45% by 2030 to align company policy with the Paris Climate Accord.

What will happen when the other supermajors are also forced comply with mounting ESG and governmental pressures and reduce upstream spending? We believe non-OPEC production will continue to decline, further paving the way towards increased capital expenditures for renewable energy projects. Rystad Energy analysis forecasts renewable energy projects to set a new record in 2021 ($243 billion), narrowing the gap with oil and gas spending (projected to be relatively flat at $311 billion).

These facts all align with the multi-step strategy that President Biden announced just earlier this month: By 2030, half of all new vehicles sold in the US should be electric. And while this goal is a bit loftier than the EV sales projections found below, the transition from oil to electric is obviously no longer a trend, but instead a full-blown movement.

Electric Vehicle Stocks

Underscoring this movement was the pledge made by executives from the three largest US auto companies: 40 to 50% of their new car sales would be electric by the end of the decade. Understanding that gas-powered vehicles are the single biggest source of greenhouse gases in the US (producing more than 25% of our total emissions), a rapid shift from combustion engines to EVs continues to aggressively take place. Need further confirmation?

The question certainly remains: Will consumers buy them?

At Towerpoint Wealth, we recognize there are obstacles: higher sticker prices, the lack of widespread charging stations (needed for longer-distance drivers), stress to the country’s power grid (if every American drove an EV today, the US could end up using about 25% more electricity than it does today), and pressure from labor unions (EVs have 30-40% fewer moving parts, and require fewer workers to assemble) are all headwinds to this movement. However, we also believe it is just a matter of time before combustion-engine vehicles take their place next to rotary phones, VCRs, and the folding maps.

rotary phones, VCRs, and the folding maps

What’s Happening at TPW?

Three generations of Eschleman men!

Our President, Joseph Eschleman, attended the Philadelphia Phillies / Tampa Bay Rays game on Wednesday evening at Citizens Bank Park in Philly, with his father Eric and his 11-year-old son, Henry.

The Phils blew the game in the ninth inning, but all three Eschlemans had a great time together!

President, Joseph Eschleman, attended the Philadelphia Phillies his father Eric and his 11-year-old son, Henry

In an effort to maximize our productivity as a firm, we were early to adopt Salesforce as our customer relationship management (CRM) software.

Salesforce forms the backbone of our operations, allowing us to efficiently administer and manage all of our interactions with clients, colleagues, prospects, and friends.

A huge thank you to Ryan O’ConnellDynasty Financial Partners’ CRM specialist (in the photo, “sandwiched” between Michelle Venezia and Lori Heppner after lunch yesterday) for being on site this week to assist with a Salesforce instance upgrade, helping us to stay ahead of the curve and better interface and communicate with each of our clients!

Ryan O'Connell Dynasty Financial Partners Michelle Venezia Lori Heppner

Illustrations/Graphs of the Week

Have you heard that federal capital gains taxes may soon be increasing?

Although the final details of President Biden’s American Families Plan to potentially increase capital gains taxes (to pay for some portion of the various US Congressional domestic priorities such as education and child care) are not yet specified, they are likely to influence securities prices and financial market conditions.

Oddly, the chart below depicts the price return of the S&P 500 index six months before and six months after capital gains taxes were increased.

By far (and we feel, surprisingly), the six months BEFORE capital gains taxes are increased represent the periods of most risk to equity prices.

Capital Gains Tax Stocks


Trending Today

As the 24/7 news cycle churns, twists, and turns, there have been a number of trending and notable events that have occurred over the past few weeks:

As always, we sincerely value our relationships and partnerships with each of you, as well as your trust and confidence in us here at Towerpoint Wealth. We encourage you to reach out to us at any time (916-405-9140, info@towerpointwealth.com) with any questions, concerns, or needs you may have. The world continues to be an extremely unsettled and complicated place, and we are here to help you properly plan for and make sense of it.

– Joseph, Jonathan, Steve, Lori, Nathan, and Michelle

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Worried About The Obscurity of YOUR Social Security? 07.30.21

Imagine you were offered a job, and were counting on it to provide income for you AND your family for many many years. BUT, you didn’t ask about 1.) the starting date, 2.) the salary, nor 3.) the benefits!

Now, change ‘job’ to ‘Social Security’ and you get a sense of the general lack of knowledge many Americans have about this bedrock retirement income stream.

However, why is the very foundation of retirement security for millions of Americans so confusing? When should you take your Social Security benefit? Early at 62? At normal retirement age (NRA)? Delay and take it at 70?

Social Security Benefits waiting until 70

Do you have concerns about the solvency of the Social Security system (hint: as long as workers and employees pay payroll/FICA taxes, it’s not going anywhere), and how that might affect your benefit?

Social Security Explained system

Have you heard of Social Security spousal benefits and survivor benefits, but not sure you understand how they work?

Social Security spousal benefits survivor social security benefits

Social Security Explained | Other FAQ’s about Social Security include:

  1. What exactly is Social Security?
  2. When am I eligible for Social Security?
  3. How is my eligibility determined?
  4. How much do I pay in to the Social Security system?
  5. How much will I get from Social Security?
  6. What happens to my Social Security benefit if I still work?
  7. Do I owe taxes on my Social Security income?
  8. How do I qualify for Social Security disability benefits?
  9. What is the average Social Security benefit?
  10. What will COVID-19 do to Social Security?

Still confused? Have more questions? Hungry for clear answers? Found below is a simple educational video we just produced, designed to break down the complicated topic of Social Security, specifically arranged in a digestible and easy-to-understand format.

Click HERE to watch the video!

Towerpoint Wealth social security explained

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Understanding it is an imperfect system, Social Security continues to be a central and essential component of the retirement income planning and optimization we do with virtually all of our clients at Towerpoint Wealth, with literally hundreds of thousands of dollars at stake depending on how you claim it.

What’s Happening at TPW?

Most of the Towerpoint Wealth team spent some time earlier this week prepping new backpacks full of back-to-school supplies we purchased for low income and homeless students in the greater Sacramento area.


Cheers and thumbs up to Jesuit High School here in Sacramento for coordinating this program, as it is enjoyable to do little things like this to give back and help our local community.

Towerpoint Wealth Backpack Packing for jesuit high donation 7_27_2021

Happy 37th birthday on Wednesday to our smart, YOUNG, fun, sincere, affable, and hard-working Partner, Wealth Advisor, Jonathan LaTurner. Jon’s amazing birthday dinner was held at Canon | East Sac, and his amazing birthday cakes were prepared by Freeport Bakery – mmmmm!

Towerpoint Wealth Partner Wealth Advisor Jonathan LaTurner

Graphs of the Week

Some say low interest rates, a perennial shortage of housing supply, and the new geographic mobility of would-be homebuyers all mean the white-hot real estate market has more room to run (click HERE to watch an excellent TPW-produced video on this subject).


Others believe the OPPOSITE – that soon-to-be rising interest rates, artificially-high prices, the end of mortgage forbearance and foreclosure moratorium programs, and the divergence between home prices and wages all portend an upcoming end to the massive residential real estate bull market.

What do you think is going to happen to home prices over the next 12 months? Click HERE to message us and let us know your thoughts!

More room to run for home prices?

interest rates home prices

or the end of the road for price increases?

Price increase home divergence

As the 24/7 news cycle churns, twists, and turns, there have been a number of trending and notable events have occurred over the past few weeks:

As always, we sincerely value our relationships and partnerships with each of you, as well as your trust and confidence in us here at Towerpoint Wealth. We encourage you to reach out to us at any time (916-405-9140, info@towerpointwealth.com) with any questions, concerns, or needs you may have. The world continues to be an extremely unsettled and complicated place, and we are here to help you properly plan for and make sense of it.

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– Joseph, Jonathan, Steve, Lori, Nathan, and Michelle

Towerpoint Wealth Sacramento Independent Financial Advisor
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NEW Rules to Ensure That Your Retirement is SECURE? 07.09.2021

Here we go! “How much do I need to retire? How much in retirement savings should I have?” – two questions virtually all of us have asked ourselves as our non-working, non-earning years draw closer.

If (or perhaps we should say WHEN) the Secure Act 2.0 becomes law, many pre-retirees will have a myriad of additional new options and opportunities to save and invest for retirement, and to build and protect their net worth. And while there is no such thing as a “sure thing” in Washington D.C., the Securing a Strong Retirement Act of 2021 has bipartisan support, and was approved unanimously by the House Ways and Means Committee just over two months ago.

What is changing, and what kind of new net worth building and retirement saving options and opportunities will be available? Click the link below to watch an engaging six-minute educational video that we just recently published, featuring our President, Joseph Eschleman, *jam-packed* with information highlighting six MAJOR ways your retirement savings plan may change (for the better!) if the Secure Act 2.0 becomes law:

Click HERE to watch Joe’s video.

Build Wealth Joseph Eschleman Secure Act 2.0 You Tube Retirement Savings

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“How much savings do I need for retirement?” is a question we look forward to helping clients, colleagues, and friends (i.e., YOU) succinctly and tangibly answer. We specialize in retirement income planning, and – understanding how unique everyone’s personal and financial circumstances are – we encourage you to click HERE to contact us and begin a no-strings-attached dialogue about how to answer this important question for yourself.

Shifting gears, the June 23 cryptocurrency/Bitcoin webinar we hosted along with our partners at Eaglebrook Advisors was extremely well-received. Please click on the story tile below to read Eaglebrook’s latest white paper, Bitcoin’s Role in Model Portfolios, and if you missed our 6/23 webinar…Click HERE to watch the replay!

Bitcoins Role in Model Portfolios

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What’s Happening at TPW?

Our President, Joseph Eschleman, and Director of Tax and Financial Planning, Steve Pitchford, couldn’t be happier being vaccinated and getting back out to spend IN PERSON face-to-face time with a number of important Towerpoint Wealth clients and colleagues!

Joseph and Steve Shaffer in downtown Davis, CA

johnny and dorace lynch joe Towerpoint Wealth Sacramento Wealth Management

 Joseph, Dorace Lynch, and Johnny Lynch in Vacaville, CA

bill kendall and nancy kendall meeting with steve and joe retirement savings


Joseph, Nancy Kendall, Bill Kendall, and Steve in Elk Grove, CA

Cartoon of the Week

As the cartoon below illustrates, inflation is not always immediately visible, and not always “feelable” (although if you have purchased a tank of gas, a new home, or a new or used car lately, your wallet has certainly felt it!) and its insidious nature can be quite problematic when investing to grow your net worth. Trying to answer the question “How much do I need to retire?” cannot be done without considering the impact that inflation will have on the cost of your future retirement lifestyle.

inflation and summer of recovery

At Towerpoint Wealth, we feel that avoiding risk when investing (i.e. prioritizing that your nest egg and retirement funds do not fluctuate up and down in value) by focusing on owning CDs, money market funds, and cash “safely” in the bank, is akin to letting inflation peck away and erode your net worth. We believe that “risk,” in and of itself, is not a bad thing – it is one of the few variables we have direct controlover. The binary question of “if” risk should be taken is inappropriate in our opinion – instead, we believe that evaluating, measuring, and justifying exactly howmuch and/or what level of risk should be taken is the more important consideration.

Highlighted by the deterioration in value (in REAL dollars) that “safe” investments can and oftentimes do experience due to inflation (and income taxes), it is important to understand that both “safety” and “risk” are relative terms, and to think critically about both concepts when developing, implementing, and managing a customized financial, investment, and retirement plan and strategy.

first class mail Stamp cost

In addition to new legislation and inflation gyration, a number of trending and notable events have occurred over the past few weeks:

As always, we sincerely value our relationships and partnerships with each of you, as well as your trust and confidence in us here at Towerpoint Wealth. We encourage you to reach out to us at any time (916-405-9140, info@towerpointwealth.com) with any questions, concerns, or needs you may have. The world continues to be an extremely unsettled and complicated place, and we are here to help you properly plan for and make sense of it.

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– Joseph, Jonathan, Steve, Lori, Nathan, and Michelle

Towerpoint Wealth Sacramento Independent Financial Advisor
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Questions to Ask if Building Wealth is the Task 05.28.2021

As we sit on the eve of 2021’s Memorial Day Weekend, 73% of those in a Quinnipiac poll said their plans are similar to the ones they had pre-pandemic. The light at the end of the pandemic tunnel is getting brighter and brighter by the day!

building Wealth Questions to Ask

We’re looking at plunging COVID-19 case and death rates and widening vaccination uptake rates here in the United States, in addition to an uptake in exuberance and economic optimism by investors that has driven the stock market to all time highs. And, as is typically true during periods of market extremes, the talking heads, market strategists, investment gurus, and even your brother-in-law Frank seem to have all the answers as to why this is happening, and what lies around the corner. Our advice to you: Ignore this nonsense, and ignore them all.

Rather than become enamored by these predictions and/or fall prey to a well-articulated story spun by a seemingly well-credentialed “expert,” we encourage you to tune out this noise, and not worry nor think too much or too hard about interest rates, cryptocurrencies, inflation, China, large caps and small caps, mask mandates, or the U.S. deficit. Don’t worry about what the “new normal” means, and don’t get too worked up about “getting your share” of the possible American Jobs Plan or the American Families Plan stimulus packages (we’re purposefully not even linking to any of these themes). Instead, let’s channel our energy and attention into things that we have control over.


While we do believe you should always be ready for the unexpected, we also feel it is way more important to understand and internalize a number of foundational investing and wealth building principles. Ask yourself if you can succinctly and confidently answer the following questions:

  • Can I remain objective and rational, and recognize when you are being fearful, greedy, and emotional about your money? Your worst investment enemy is usually found by looking in the mirror. The limbic system is a wonderfully complex set of brain structures that deal with emotions, but activating your fight or flight response in reaction to fear, greed, and anger is not conducive to successful investing or successful longer-term wealth building. 
  • Do I understand that my neighbors, friends, and co-workers are perhaps confused and delusional? Not only do they probably spend too much and boast too much about their portfolio, but the chances their financial decisions are rooted in any of the principles listed here are quite low.
  • Am I trying to simply make money, or am I working to build and protect my wealth? We equate the former to gambling, and the latter to investing. While anything can happen on a daily, weekly, monthly, and even annual basis, we believe your odds of success increase significantly if you establish and follow a disciplined longer-term wealth building plan.
  • What am I doing to proactively insulate my downside from a major catastrophe during a market correction? We believe this is way more important than hitting a home run during a period of market strength. While his two rules are a bit binary, the spirit of Warren Buffett’s quote should resonate:
  • Why am I investing, and do I have a plan? For obvious reasons, it is invaluable to not only think through, articulate, and quantify the goals and vision you have for your and your family’s future, but also to have a methodology for how you attend to your personal financial decision-making. And this methodology will be different than your friend’s, neighbor’s, or co-worker’s, as we all obviously have different things that motivate us and that we ultimately want out of life. This is assuming that your friend, neighbor, or co-worker even has a plan at all.
  • Do I recognize that costs, fees, expenses, and taxes matter? At Towerpoint Wealth, we call them “necessary evils” to helping clients grow and protect their net worth. And while we can never eliminate the drag that costs, fees, expenses, and taxes creates, we certainly can work to identify, and reduce, these friction points.
  • Am I aware that saving money is the single most effective way to build my wealth and to retire? While you need to have balance between saving for tomorrow and living your life today, the capital you spend today is capital no longer available to fund your retirement. Saving money equals peace of mind.

Towerpoint Wealth Turns Four!

On May 26, 2017, with zero clients and $0 in assets under management, we officially launched Towerpoint Wealth. Classified as a “bold,” “risky,” “fearless,” and “courageous” decision by our clients and colleagues, it fortunately turned out to be a prescient and extremely positive one based on the feedback we continue to receive and strategic growth we continue to experience.

Today, we are approaching $350 million in assets under management, and continue to be thrilled to serve YOU, always striving to expand your peace of mind by helping you remove the hassle of properly coordinating your financial affairs.

What’s Happening at TPW?

The Towerpoint Wealth crew recently spent some time in a professional photo shoot with Tim Engle, of Tim Engle Photography – below is one of our favorite shots from the session.

We hold our collective noses to the grindstone at Towerpoint Wealth ~ 97% of the time. However, the culture we have built at the firm is also predicated on spending time outside the office and having fun together as a work family, which is why we regularly schedule fun teambuilding events.

We had an enjoyable “hooky afternoon” earlier this month, pedaling through midtown Sacramento on the Sacramento Brew Bike, with pit stops at Public House DowntownKupros, and The Golden Bear. A well-behaved and fun afternoon!

TPW Service Highlight – RETIREMENT – Building wealth

We only semi-jokingly say that you can retire any time you want, but will you be able to with the lifestyle and income stream you desire?

At Towerpoint Wealth, we believe that everyone deserves a secure retirement, and we stand ready to help you with a myriad of retirement-specific tools and planning considerations. The cornerstone of this process is the development of a customized retirement and financial plan using our modeling software from RightCapital(R).

Click HERE to review a sample customized RightCapital financial plan.

Additional retirement-specific services include sustainable and tax-efficient retirement income planning, “black swan” event planning and modeling, customized Social Security benefit election optimization analysis, corporate pension modeling and optimization, fixed/variable/immediate annuity analysis, and optimal-retirement-age projections.

Chart of the Week

Real estate values continue to be on fire! Click HERE to watch an excellent video in which our President, Joseph Eschleman discusses the white hot Sacramento real estate market with long-time Sacramento realtor, Brian Kassis.

And while there is no question about the tremendous price increases homeowners have experienced over the past year and a half, the chart below makes an interesting comparison between the value of the stock market (using the S&P 500 as a proxy) and the value of residential real estate (using the Case Shiller U.S. National Home Price Index as a proxy) over the past 30 years.

Understanding the importance of owning both real estate AND equities when working to build net worth, and recognizing that people seem to be more relational to the increases in the value of their home, the chart below from Visual Capitalist is an eye-opener!

In addition to home prices going up and U.S. COVID numbers going down, a number of trending and notable events have occurred over the past few weeks:

As always, we sincerely value our relationships and partnerships with each of you, as well as your trust and confidence in us here at Towerpoint Wealth. We encourage you to reach out to us at any time (916-405-9140, info@towerpointwealth.com) with any questions, concerns, or needs you may have. The world continues to be an extremely unsettled and complicated place, and we are here to help you properly plan for and make sense of it.

– Joseph, Jonathan, Steve, Lori, Nathan, and Michelle

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Is Your 401(k) in Disarray 03.29.2021

As a small business owner, we know that you are an “around the clock” grinder, with a myriad of responsibilities that often supersede the core responsibilities you have to the growth of your business. And understanding that a regular review of your business’s retirement plan may not be a top priority of yours, at Towerpoint Wealth we have created this 401(k) “healthcheck” for your benefit. We regularly come across 401(k) and other company-sponsored retirement plans that, as currently structured, are in serious need of attention and improvement, and we are experienced in helping you, as a trustee and fiduciary to your company’s retirement plan, minimize the hassle of giving your plan the attention it needs.

Is your 401(k) plan structured and optimized properly to help you and your employees maximize the myriad of economic, investment, and tax benefits? Are you properly managing your fiduciary responsibility? Ask yourself the questions found below to quickly gauge whether your 401(k) needs adjusting or improving.

 Does my plan have a safe harbor structure?

You want to ensure that your 401K) retirement plan passes the annual non-discrimination testing conducted by the IRS. In its simplest sense, non-discrimination testing ensures that an employer is making contributions to each employee’s retirement account that equals the same percentage of salary for everyone. Importantly, if a plan fails a non-discrimination test, the 401(k) may lose its tax-qualified status.1

Retirement Plan 401(k) Disarray Towerpoint Wealth White paper 2021

[1]The most common reason a 401(k) plan fails this non-discrimination testing is when one or more of the business owners make much greater 401(k) contributions compared to their employees.

A safe harbor 401(k) plan structure ensures that you meet the non-discrimination regulatory requirements by following strict guidelines specific-to employer plan contributions, participant disclosures, and much more. 

Does my plan have a profit-sharing component and if so, am I optimizing its structure?

For a business owner to maximize the personal net worth building benefits associated with sponsoring a company retirement plan and receive the maximum 401(k) annual contribution amount of $58,000 in 2021[1] (employee deferrals + employer contributions), pairing a profitsharing component in the plan’s design is essential.

All profit sharing plan structures – same dollar amount, comptocomp, new comparability, etc.[2] – are not created equal. In particular, the new comparability strategy is becoming increasingly more common in modern 401(k) plans as this type of profit-sharing plan allows for unique flexibility in allocating the profits among the business owner(s) and employees.

Is my investment fund lineup optimized?

401(k) investment fund lineups vary from basic to advanced and passive to active. And with employees having better and more diverse investment options outside of 401(k) plans, annually reviewing your company’s fund lineup for improvements is critical to ensure that employees do not look to invest their hard-earned dollars elsewhere, and also to meet your fiduciary responsibility as plan trustee.

It is also a requirement that a business owner (usually with help from an investment professional) formulate, and review at least annually, an investment policy statement (IPS) for their 401(k).

Is my ERISA fidelity bond fund amount appropriate?  

The Employee Retirement Income Security Act (ERISA) requires 401(k) plans to hold a fidelity bond, which protects the plan from losses resulting from improper handling of the funds.

While fidelity bonds are generally inexpensive for the coverage offered, we often see the amount protected as either 1.) inadequate or 2.) overkill.  

[1] Increased to $64,500 for business owners 50 years of age or older.

[2] There are often several different terms that refer to the exact same type of profit-sharing structure.

Does my plan currently allow for after-tax Roth contributions?

While changing for the better, many 401(k) plans still do not allow after-tax Roth contributions. 

For business owners and employees that are in a temporarily low income tax bracket –  a business owner “winding down” and closing in on retirement or a younger employee at the beginning of their career and earning curve – offering an after-tax Roth contribution option, particularly given it typically costs nothing to do so, is a valuable and often overlooked plan benefit.

Is my vesting schedule appropriate?

Retirement Plan 401(k) Disarray Towerpoint Wealth White paper 2021

In order to incentivize employees to stay with your company, having a vesting schedule for any  employer-matching profit sharing contributions that is not overly generous is important. For a number of Towerpoint Wealth’s clients who are business owners, a vesting schedule of six years (with 0% vesting in the first year of participation) is appropriate, but each business and retirement plan is unique.

Have I considered automatically distributing an employee’s 401(k) balance when they leave the company?

Many 401(k) plan administrators charge their fees based on the number of employees that the plan has. 

In order to keep fees to a minimum, it is advisable to consider automatically distributing account balances below a certain threshold when an employee separates from service.

Am I managing my fiduciary responsibility and minimizing my fiduciary liability?

All business owners who offer a 401(k) for themselves and their employees have a fiduciary responsibility to ensure that they are acting in the employees’ best interests, being prudent, diversifying plan investment assets, and adhering to all provisions of the retirement plan documents.

There are concrete steps that a business owner can take to uphold their fiduciary duty and at the same time, minimize their fiduciary liability.

Retirement Plan 401(k) Disarray Towerpoint Wealth White paper 2021

Wealth management firms that specialize in helping business owners optimize their retirement plans, such as Towerpoint Wealth, are able to help guide you through these murky waters.

Am I doing everything I can to maximize my own personal net worth within my company’s retirement plan?

Even if a small business owner has a well-structured plan that meets everyone’s needs, is it important to remember that 401(k)s, and other types of company-sponsored retirement plans, are uniquely customizable. And often, there are overlooked plan features that may help the business owner maximize their ability to accumulate wealth within the plan. 

One of these particularly powerful features is allowing for after-tax deferrals (not the same as after-tax Roth deferrals), which then affords the business owner to take advantage of the “Mega Backdoor” Roth IRA strategy.

Some other questions that are worth your thoughtful attention: Do I allow for hardship distributions and if not, should I? What about allowing rollovers from other retirement plans? Is it risky to offer loans to employees? Are my plan’s expenses and fees reasonable?

How Can We Help?

Steve Pitchford, CPA, CFP®
Director of Tax and Financial Planning

At Towerpoint Wealth, we are a legal fiduciary to you, and specialize in optimizing retirement plan structures for business owners.. If you would like to speak with us regarding any other tax questions you may have, we encourage you to call (916-405-9166) or email (spitchford@towerpointwealth.com) to open an objective dialogue.

Towerpoint Wealth, LLC is a Registered Investment Adviser. This material is solely for informational purposes. Advisory services are only offered to clients or prospective clients where Towerpoint Wealth, LLC 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, LLC unless a client service agreement is in place.


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Choosing Who Will Inherit Your Retirement Accounts

You are working on your estate plan, and trying to figure out who you should name as the beneficiary of your 401k account and IRAs. Simple – the kids, right? Not so fast.

Click to watch the video below from our Wealth Advisor, Matt Regan, to learn the non-spouse beneficiary distribution rules for inherited and pre-tax IRAs and “regular” pre-tax 401ks, and why understanding these rules are so important for income tax and estate planning purposes.

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Funding a “Backdoor” Roth IRA

Do you have the enviable problem of NOT being able to contribute to a tax free Roth IRA every year because you make too much money?

Click to watch the video below from our Wealth Advisor, Matt Regan, to learn how you can go through the back door and still fund a *tax-free* Roth every year!

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Five Things I Wish Someone Told Me Before I Became A Founder 02.12.2021

Our President, Joseph F. Eschleman, CIMA®, was interviewed by Candice Georgiadis, a contributing writer to Authority Magazine, as part of her series about leadership lessons of accomplished business leaders. Joseph’s story and message does an excellent job of summarizing not only how passionate and driven he is as President and founder of Towerpoint Wealth, but also the grit, tenacity, and hard work it takes to build and grow an individual advisory practice, and to then pivot, and ultimately build and grow a $300 million boutique wealth management firm.

Click HERE to read the Joseph Eschleman / Towerpoint Wealth story!

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Coffee At Home

Investing early and making intelligent incremental monetary decisions usually leads to BIG THINGS, it just takes time and discipline.

Click below and take 60 seconds to watch Matt Regan, CPA, MBT – Wealth Advisor‘s most recent OneMinuteTaxTip video to learn how a simple change in your financial lifestyle, such as making coffee at home, can end up having a huge impact on your longer-term networth and your ability to #retire when you want to!

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A Ben Franklin Redux

An Attorney’s Guide to Building and Protecting Personal Net Worth 

By: Matthew Regan, Wealth Advisor

Remember how you felt the day you said “I passed the bar!”?

That day, you no doubt celebrated your great accomplishment. It marked not only the closing chapter of your law school career, but the opening of an important new chapter in your personal and professional life, one with tremendous economic upside if properly harnessed. 

In his essay Advice to a Young Tradesman, Benjamin Franklin famously states, “Time is money.” This phrase, which he wrote in 1748, still rings true today, especially for busy attorneys and law-firm partners like yourself, who earn a living primarily from billable hours. 

As the numbers increase on your net worth statement, so does the responsibility of managing them correctly. As you accumulate wealth, have you achieved economic peace of mind? Not having the time, expertise, or patience, to establish and execute on a customized wealth-building and retirement strategy is neither a failing nor a flaw – it is a very common problem.

Finding an expert, trustworthy partner to help you manage and coordinate much of this “financial heavy lifting” can lead you closer to the economic peace of mind you have been working so long and hard for. 

Emotional Awareness – Your Strength and Your Weakness?

As a successful attorney, you are committed and laser focused on helping your clients, managing and collaborating with colleagues, and balancing the administrative obligations of running your practice.

You are working to strike the appropriate balance between your career and your family life. It is challenging — and stressful — to properly coordinate all of this. Consider too, that you have a responsibility to develop and execute on a well-thought-out and disciplined plan to grow and protect your personal wealth. It’s no wonder this task often gets back-burnered until you “aren’t so busy.”

Unfortunately, for many lawyers, “not so busy” only becomes a reality once retirement does, and by that time, many critical economic decisions, key financial and investment planning opportunities, and basic compounding benefits have come and gone.

Get Help, and Don’t Get Burned!

If you haven’t yet hired a professional to help, it might be because you’ve heard about uninspiring, unsettling, or even outright illicit experiences with so-called “financial-advisors.” Certainly, what tends to be the most challenging aspect of hiring an advisor is finding one who cultivates your trust.

An important part of the wealth building journey is partnering with the right financial advisor. The first step you can take is to ask friends and colleagues to share their successful experiences with advisors. The advisor is providing a service that will have a lasting impact on your financial future, so you need to be sure you are hiring the right person to meet your specific goals.

Your advisor will need to know every single aspect of your financial life, and oftentimes many aspects of your personal life as well, in order to provide the most appropriate advice and customized solutions. Each member of your family, especially your significant other, must have confidence the advisor will always hold your family’s best interests above their own. Because most attorneys have uneven cash flow throughout the year, complicated tax issues, and complex retirements, your advisor will be able to best serve you when they have a strong understanding of how you are compensated and the complexities of it. These things that make financial planning difficult for you, are well inside a fiduciary advisor’s wheelhouse.

“Suitable” versus “Fiduciary”

A second extremely important step when searching for an advisor is to assure they are bound to a legal fiduciary standard. As a legal fiduciary, a financial advisor is typically regulated by the Securities and Exchange Commission (SEC), and is legally held to the highest standard in the industry, the fiduciary standard. They are required to discharge their planning, counsel, and advice solely in the best interests of the client, even if it means placing the client’s interests ahead of the advisor’s.

Starkly contrasting the fiduciary standard and obligation is suitability standard, which simply requires a financial advisor to make recommendations that are “suitable” for a client. Importantly, the suitability standard does not legally require an advisor to act solely in a client’s best interests. Another significant distinction between these two very different professional standards is how an advisor is compensated. A fiduciary advisor’s compensation generally is via an annual, asset-based fee, computed based on a percentage of the client’s assets under management. A financial advisor who is not a fiduciary oftentimes receives hidden compensation from products with higher fees and lower returns that they’ve steered you into. Recently, theWhite House Council on Economic Advisers found that non-fiduciary advice costs investors $17 billion a year! And, as Franklin said in his aforementioned essay:

“You will discover how…small, trifling expenses mount up to large sums, and will discern what might have been…saved.”

With a commission-based compensation structure, there is the possibility for conflicts of interest. If a prospective advisor is not 100% transparent about how he or she answers the question, “How do you get paid?” look elsewhere. A true fiduciary will be quick to point out how, and wherefrom, they derive professional compensation for their time, service, and planning. How do I know if a financial advisor is a legal fiduciary?

The simple answer – ask! You will quickly find out which standard a prospective financial advisor adheres to when you ask:

“As my prospective financial advisor, would you be a legal fiduciary to me, and are you willing to attest to that in writing?”

What Can I Expect From a Good Financial Advisor

Because every individual has a unique set of personal and financial circumstances, it is a crucial first step for your financial advisor to help you determine and set your financial goals. Sounds easy, right? Maybe — until you seriously consider your responses to the following questions:

  • What money concerns keep you up at night, and how would you like me to work with you so you can rest soundly?
  • What are you doing now, and what do you want to accomplish in life?
  • What decline in your overall investment portfolio, in hard dollars, would cause you great personal discomfort such as lack of sleep, anxiety, worry, or even despair?
  • Why do you think you need financial help and guidance?
  • What changes do you expect to occur in the future?
  • How do you picture your ideal life five years from now? Ten? Fifteen?
  • How would you describe the emotions you had about money growing up?
  • What are three financial milestones you hope to accomplish?

By no means all-encompassing, this list of questions is meant to illustrate the depth and sincere interest in you that the right financial advisor will demonstrate during the discovery phase of your relationship. In addition to asking, listening to, and considering your answers to thoughtful questions such as these, any good advisor will dedicate their time and energy to you in order to develop a rapport, and ultimately, trust.

Investing, coordinating, and managing your wealth and assets is a challenge that increases as your net worth does, and just like in law, where having a good lawyer when entering the courtroom should yield the highest probability of success, the same holds true for wealth management and working with a qualified financial advisor.

Financial Emotional Awareness

Managing emotions and remaining objective when making financial decisions is an essential component of longer-term success in building, and protecting, one’s wealth. Every day, individuals are bombarded with information that can make them question whether or not they are making the right choices with their finances. A quality, trustworthy financial advisor will help guide you through the noise and protect you from making emotional or irrational decisions to ensure you stay on your path to financial freedom.

My Lawyer Does the Same Thing…

When working with an attorney, a client should expect to receive custom-tailored planning, advice, and counsel only after a myriad of different possibilities and probabilities about the future have been considered. This construct of a financial advisor-client partnership differs little, as this same process holds true in finance as it does in law.

A quality financial advisor will leverage a broad-based array of resources to provide solutions and advice, much of which you may never have heard of, thought about, or had access to.

They will help you identify your level of acceptable risk, and a target rate of return to be able to meet your personal and economic goals. As is true in the courtroom, there is a direct correlation between taking risk and the potential for obtaining the desired results. The financial relationship between risk and return is inextricable, and needs to be consistently monitored due to the ever-evolving landscape of the economy, politics, the financial markets, and most importantly, your own personal circumstances. Having a professional help you manage this balance between risk and reward increases the probability of your achieving financial success.

Reducing Drag and the “Necessary Evils”

Keeping what you have saved and earned is just as important as growing it.

Specifically, a good financial advisor will work with you to manage and minimize the two major necessary evils:

  1. Income taxes
  2. Costs/fees/expenses

Understanding almost all financial transactions incorporate a tax and a cost component, your financial advisor and your tax advisor should consistently interface with each other to develop and implement effective tax mitigation strategies to help you keep as much of your hard- earned dollars in your pocket as possible. For most attorneys, current self-employment and income tax rates are high, and will likely only increase in the future. The efficiency of growth in your net worth can be directly affected by lackluster tax planning, not only by the choices you make in how you receive and allocate your ordinary income as you save and invest, but also in how and where you derive investment income. This is especially true when it comes to your

retirement planning. As you accumulate wealth, it is imperative for your financial and tax advisors to work together to maximize how and where you are making retirement contributions, and how and where to leverage the multitude of tax benefits that are available.

During retirement, as you begin strategic withdrawals from your nest egg, your advisors should regularly analyze not only the sustainability of how much you are taking, but should also weigh in on how and where to make withdrawals, based largely on your current tax bracket as well as the expected future tax environment. For attorneys

fortunate enough to have a retirement pension, an analysis should be done to determine whether it is better to take as a single-life or joint-life annuity or as a lump sum in order to maximize your net dollars.

Lastly, to enhance the longer-term growth of your wealth, your financial advisor should work with your investment managers to methodically select the right investment vehicles that produce the greatest after-tax returns for both your managed and unmanaged assets. After all, it is not what you make but what you keep that is important. 

Time to Enjoy!

Planning your financial future in addition to all your other professional and personal responsibilities is a daunting task, but you don’t want to wake up one day and ask yourself why your colleagues are retired while you are still working. Being a lawyer is rewarding job, but it can be very stressful and requires long hours. Thirty or more years of this lifestyle can take quite a

toll on the body and mind, and you deserve a rewarding financial future and economic peace of mind. Time is money. Beginning a succinct and custom-tailored wealth management plan now will help you achieve your goals, and ultimately, help you retire on your schedule. Partnering with an advisor that not only understands you, but also the unique financial challenges that attorneys face, means you may spend less time worrying about this aspect of your life.

You wouldn’t hesitate to hire a legal expert to help you win a case or strengthen a lawsuit, and the same can certainly be said about hiring a financial expert advisor to help you properly coordinate all of your financial affairs and ideally, build economic peace of mind.

How Can We Help?

At Towerpoint Wealth, we are a legal fiduciary to you, and embrace the professional obligation we have to work 100% in your best interests. If you would like to learn more about Towerpoint Wealth and how we can help you achieve your financial goals, we encourage you to call (916-405-9164) or email (mregan@towerpointwealth.com) to open an objective dialogue.

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