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March 2024

Safeguarding Your Legacy: What Is Estate Planning?

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Estate planning may not be the first thing on everyone’s mind, but it’s a big part of responsible financial planning. Estate planning isn’t just about safeguarding your wealth; it’s about making sure your wishes are carried out and your loved ones are protected in the future.

What Is Estate Planning?

In essence, estate planning is the process of organizing your assets, liabilities, and wishes for their distribution after your passing. It encompasses various elements, including:

  • Asset allocation: Choosing who inherits your belongings, from real estate and investments to personal possessions.
  • Beneficiary designation: Specifying who receives the proceeds from your retirement accounts, life insurance policies, and other designated assets.
  • Guardianship and healthcare directives: Appointing individuals to make decisions on your behalf if you become incapacitated, ensuring your medical wishes are respected.
  • Tax minimization strategies: Implementing structures to reduce the tax burden on your estate and maximize the inheritance your loved ones receive.

Can’t I Handle My Estate Planning in My Will?

A will is a crucial component of estate planning, but it may not be enough to accomplish all your goals.
Here’s why:

What a will can do:

  • Distribute assets: A will allows you to specify who inherits your belongings after your death, reducing potential confusion and conflict among beneficiaries.
  • Appoint guardians: You can designate individuals to care for minor children and manage their assets if you’re no longer able.

Limitations of a will:

  • Probate: Wills typically go through probate, a court process that can be time-consuming, costly, and public.
  • Limited control: A will doesn’t offer much control over how and when assets are distributed.
  • Ineffective for certain assets: Assets held jointly or with beneficiary designations bypass a will and transfer automatically.

Where a will falls short:

  • Complexities: If your estate is substantial or involves intricate family dynamics, a will alone might not provide sufficient clarity and control.
  • Tax Minimization: Wills offer limited opportunities for minimizing taxes on your estate.
  • Incapacity planning: A will doesn’t address situations where you become incapacitated and need someone to make financial or medical decisions on your behalf.

Navigating the Complexities:

Estate planning can involve intricate legal and financial considerations. Consulting with a qualified professional like a Certified Financial Planner™ (CFP®) or Wealth Manager can be invaluable.

Such professionals possess the expertise to:

  • Assess your unique situation: A professional can meticulously analyze your assets, liabilities, family dynamics, and financial goals to develop a personalized plan.
  • Recommend suitable strategies: Based on your specific needs and objectives, a CFP® or Wealth Manager may suggest appropriate tools and structures, such as wills, trusts, and beneficiary designations.
  • Draft and implement your plan: A financial expert can work with legal professionals to ensure your documents are drafted accurately and are legally sound.
  • Provide ongoing guidance: As your circumstances evolve, a financier can help you review and update your plan to ensure it remains aligned with your evolving needs and goals.

Choosing the Right Guide: Financial Professionals for Estate Planning

While estate planning involves legal aspects, financial professionals like Certified Financial Planners™ (CFP®) and Wealth Managers can play a crucial role in the process. Their expertise complements that of legal professionals, providing comprehensive guidance throughout the journey.

Here’s what a financial pro can bring to the table:

  • Financial acumen: CFPs® and Wealth Managers possess in-depth knowledge of investment strategies, tax implications, and asset allocation, enabling them to recommend structures that optimize your estate’s value and minimize tax burdens.
  • Holistic planning: Financial professionals integrate estate planning with your overall financial goals, ensuring your plan aligns with your retirement aspirations, wealth preservation strategies, and risk management considerations.
  • An understanding of complex financial products: Experts can advise on incorporating complex financial instruments like trusts and life insurance policies into your estate plan, maximizing the plan’s effectiveness in achieving your objectives.
  • Collaboration with legal professionals: CFPs® and Wealth Managers work seamlessly with estate planning attorneys to ensure your plan is legally sound and effectively translated into enforceable documents.

Finding the Right Fit:

When looking for a financial professional for estate preparation, consider factors like:

  • Credentials and experience: Look for individuals with relevant designations like CFP® or ChFC (Chartered Financial Consultant) and demonstrable experience in estate-planning matters.
  • Investment philosophy: Choose a professional whose investment philosophy aligns with your risk tolerance and financial goals.
  • Fee structure: Understand their fee structure and ensure it aligns with your budget and expectations.

Consulting with a financial professional experienced in estate planning empowers you to make informed decisions and create a plan that effectively safeguards your legacy and fulfills your wishes for the future.

Taking the First Step:

Estate planning may seem daunting, but it doesn’t have to be. By initiating a conversation with a qualified wealth management professional, you can gain clarity, navigate the complexities, and ultimately, safeguard your legacy for the future of your loved ones.

American Wealth Management is a financial management firm in Reno, Nevada. You can engage a CFP® (Certified Financial Planner™) or another one of our qualified financial professionals simply by filling out our free consultation form.

Remember, estate planning is an investment in your family’s well-being and your own peace of mind. Don’t hesitate to take the first step toward securing your legacy and ensuring your wishes are honored.

Investment advice offered through American Wealth Management (“AWM”), a SEC-registered investment adviser. Certain personnel of AWM may also be registered representatives of M.S. Howells & Co. (“MSH”), Member FINRA/SIPC, a registered broker-dealer, and therefore, may offer securities through MSH. AWM and MSH are not affiliated entities. M.S Howells does not provide tax or legal advice. Please consult your legal or tax advisor regarding your individual situation.

The Financial Literacy Crisis

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Making Financial Decisions

Imagine driving a car without a basic understanding of the rules of the road or even how to operate it. Scary thought.

Here’s another scary circumstance – one that is all too real. Many Americans are making financial decisions with minimal financial knowledge of investing, budgeting, and credit. The TIAA Institute conducted a survey on U.S. financial literacy, asking 28 basic questions about retirement savings, debt management, budgeting, and other financial matters. The average respondent answered only about half of the questions correctly.1

Another recent survey conducted by the Census Bureau found that almost 40% of Americans say that it has been somewhat or very difficult to pay for usual household expenses in the last seven days.2

It has been said that knowledge is power, and if that’s true, then too many Americans lack the power to control their financial futures. Financial success rarely happens by accident; it is typically the outcome of a journey that starts with education.

One of the obstacles to greater financial literacy is the so-called “Lake Wobegon effect.” In other words, we all consider ourselves above average, and based on that belief, it only follows that our financial understanding is above average. Unfortunately, this assumption has a flaw: it may discourage us from learning as much as we need in order to continue adapting to an ever-changing financial landscape.

The more informed we are, the more informed our financial decisions may become. Fortunately, we can consult a wide range of resources in pursuit of greater financial knowledge.

If you are committed to increasing your financial literacy, think about turning to financial professionals with your questions or visit a U.S. Treasury-sponsored website created for that very purpose.3

If you have questions about your finances, take advantage of American Wealth Management’s 1- hour no-cost financial consultations. Submit this form to us and we will contact you to schedule a video call with one of our advisors.

American Wealth Management Reno, Nevada

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Understanding Tax Basics

10 Easy Tax Strategies to Maximize Your Return

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When tax season rolls around, it’s easy to feel like doing the bare minimum. After all, taking advantage of all your deductions can be a complex and time-consuming process.

But you can be savvy and thorough in your tax filing—without the overwhelm. It just requires a little knowledge of the basics. Here are some tax strategies to maximize your return.

Understanding Tax Basics

Whether you’re a seasoned filer or tackling it for the first time, understanding some basic strategies can help you save money and maximize your refund.

Before diving into specific strategies, let’s clarify some key terms:

  • Tax planning: Tax planning is the process of analyzing your financial situation to minimize your tax liability. Finding all the things you’ve spent money on for which the U.S. government has said you don’t have to pay taxes.
  • Taxable income: This is the amount of your income subject to taxes after subtracting deductions and exemptions. The more legal deductions you can find, the smaller your taxable income becomes.
  • Standard deduction: This is a fixed dollar amount you can deduct from your taxable income without itemizing your expenses. It’s generally simpler than listing individual deductions.
  • Tax-deductible (adjective): “Tax-deductible” describes any expense that can be subtracted from your taxable income, potentially lowering your tax bill.
  • Tax credits: These are dollar-for-dollar reductions in your tax liability, potentially resulting in a lower tax bill or even a refund. The IRS website is a valuable resource for researching different tax credits and their eligibility criteria.

10 Tax-Saving Strategies

While there is some strategy to tax planning, the actual tasks and concepts involved are pretty straightforward. Here are some easy boxes to check when you sit down to file your taxes:

1. Embrace the Standard Deduction

The standard deduction is often more beneficial than itemizing deductions, especially for individuals with simpler tax situations. In 2024, the standard deduction for single filers is around $13,850. This means if your total deductions are less than this amount, taking the standard deduction saves you time and simplifies your filing process.

2. Boost Your Retirement Savings

Contributing to a traditional IRA or employer-sponsored retirement plan like a 401(k) allows you to deduct your contributions from your taxable income. For example, if you contribute $5,000 to your IRA, your taxable income is reduced by $5,000, potentially lowering your tax bill.

3. Claim Eligible Medical Expenses

Did you know that medical and dental expenses exceeding 7.5% of your adjusted gross income are deductible? So, if your adjusted gross income (total income minus certain adjustments) is $40,000 and your medical expenses totaled $3,500, you can deduct $1,250 (exceeding 7.5% of your income). Remember to keep receipts for these expenses.

4. Support a Charitable Cause

Donating to qualified charities allows you to deduct your contributions from your taxable income. For instance, if you donate $200 to a registered charity and your marginal tax rate is 25%, you effectively reduce your tax liability by $50 (200*.25).

5. Claim Dependents (If Applicable)

Financially supporting qualifying dependents like children or elderly parents can entitle you to additional tax benefits. Depending on the dependent’s age and your income, this could significantly reduce your tax liability.

6. Take Advantage of Student Loan Interest Relief

Paying student loan interest can be a burden, but there’s a silver lining: You may be eligible to deduct a portion of the interest paid on your federal taxes. Check the IRS website for eligibility details and potential tax savings.

7. Explore Tax Credits

Low- and middle-income earners might qualify for valuable tax credits like the Earned Income Tax Credit (EITC). This refundable credit can significantly reduce your tax bill or even result in a refund. Research the IRS website to see if you qualify for this and other potential tax credits.

8. Understand Divorce and Taxes

If you’re recently divorced, understand the tax implications. Alimony payments made to your ex-spouse are generally tax-deductible for you, while they are considered taxable income for your ex-spouse. Consulting a tax professional can ensure you’re navigating these specific tax considerations correctly.

9. Go Electronic (E-Filing)

E-filing is not only faster and more secure than paper filing, but it also reduces the risk of errors and can expedite your refund. Most tax software platforms offer user-friendly e-filing options.

10. Stay Informed and Seek Help

The IRS website is a treasure trove of information on tax benefits and deductions. Additionally, consider consulting a tax professional for personalized advice tailored to your unique circumstances. Tax professionals can help you navigate the complexities of tax filing and ensure you’re taking advantage of all the benefits to which you’re entitled.

Remember, even small tax-saving strategies can make a big difference. By understanding these basic concepts and exploring the strategies that apply to you, you can approach tax season with confidence and maximize your refund.

Get Help with Your Tax Strategy

Looking for some support as you tackle tax season this year? Speak to one of the certified financial specialists at American Wealth Management. We’ll help you identify y deductibles and analyze your income and expenses so that you have all the pieces to file your taxes with confidence.

You can get a tax strategy free consultation here.


Investment advice is offered through American Wealth Management (“AWM”), a SEC-registered investment adviser. Certain personnel of AWM may also be registered representatives of M.S. Howells & Co. (“MSH”), Member FINRA/SIPC, a registered broker-dealer, and therefore, may offer securities through MSH. AWM and MSH are not affiliated entities. M.S Howells does not provide tax or legal advice. Please consult your legal or tax advisor regarding your individual situation.