Hi Money Minder,
Just wanna chat about my situation here. Lucky/unlucky enough to get a life insurance payout recently. My 401k is maxed out, IRA contributions are done, house and cars are all good, and the 529 is sorted.
My financial advisor suggested putting the insurance money into a growth plan that handles all the tax stuff and rebalances as needed. Seems like a “set it and forget it” deal, but there’s a fee involved. It’s less than 1%, but still not nothing. What do you reckon?
Cheers,
Financially Confused Funseeker
Response from THE MONEY MINDER:
Hello There,
Congratulations on receiving a life insurance payout, though I understand it may come with mixed emotions. It sounds like you have meticulously planned your financial future by maxing out your 401k, IRA contributions, and ensuring your 529 is well-funded. Your financial advisor’s proposal for a tax harvesting growth plan with rebalancing seems like a prudent move to maximize the potential of your inheritance.
While the fee associated with the plan may be less than 1%, it’s essential to weigh the cost against the potential benefits of having a professional manage your investments, especially considering your intention to set it and forget it with minimal involvement. Ensure you fully understand the details of the plan, including how the rebalancing will be executed, what benchmarks will be used, and how the fee structure works over time.
As you’ve already shown a strong commitment to financial planning by maximizing your tax-advantaged accounts and securing your assets, this approach aligns well with your overall strategy. Remember, a well-thought-out plan with a trusted advisor can provide peace of mind and potentially enhance your long-term financial security.
All the best from THE MONEY MINDER.
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