Posts by SmartAsset Team
Trusts
Trust vs. Custodial Account: Which Is Better for Your Child?
Setting aside money for your child’s future is one of the most meaningful financial decisions you can make, but the way you structure it matters. Custodial accounts are simple and inexpensive to set up, making them a practical option for getting started. Trusts give you more control over when and how your child receives the… read more…
Trusts
Can You Borrow Against a Trust Fund? Rules and Options
There may come a time when you need cash while your inheritance sits in a trust, whether you’re facing a medical emergency, want to buy a home or simply need liquidity. However, accessing trust funds isn’t always straightforward. The answer to whether you can borrow against a trust fund depends on the type of trust… read more…
Investing for Beginners
Dividend Stock Funds: How They Make Money, Benefits and Risks
Dividend stock funds provide exposure to companies that regularly distribute a portion of profits to shareholders, offering the potential for both income and long-term growth. Rather than selecting individual dividend-paying stocks, investors can use dividend stock funds to access diversified portfolios of companies that pay regular dividends. These funds may invest in companies across sectors… read more…
Real Estate
Real Estate Holding Company: How It Works, Pros and Cons
A real estate holding company is one strategy that investors use to centralize ownership of multiple properties while separating legal liability between assets. Holding companies are commonly structured using limited liability companies (LLCs) or corporations, each of which may hold a separate property. Individual investors, partnerships and family real estate businesses often use real estate… read more…
Portfolio Management
REIT Mutual Funds: How They Generate Income, Benefits and Risks
REIT mutual funds can provide income through dividend distributions while also offering potential long-term growth tied to commercial real estate markets. Because real estate often behaves differently than traditional stocks and bonds, REIT mutual funds may help improve diversification in an investment portfolio. However, like any investment, REIT mutual funds involve both benefits and risks. … read more…
Other
Risk Management for Small Business: Services and Examples
Running a small business involves handling many responsibilities at once, including managing risk. Every business faces threats that could disrupt operations, affect finances or lead to legal liability. Preparation can play a role in how a business responds when those threats arise. A financial advisor can help you identify the specific risks your business faces… read more…
Retirement Planning
Retirement Planning for Federal Employees: Services and Examples
Federal employees receive a retirement benefit package that includes a pension, a tax-advantaged savings plan and Social Security. But many do not fully understand how these benefits work, and that can mean leaving money behind. The FERS pension, the Thrift Savings Plan and Social Security each come with their own rules, deadlines and trade-offs. Whether… read more…
Tax Planning
International Tax Planning: Services and Examples
Tax planning is complicated enough in one country. Add a second, and things get more complex in a hurry. Overlapping tax obligations, foreign reporting requirements, and the risk of being taxed on the same income twice all come into play. Whether you’re a U.S. resident earning income abroad, a business operating in multiple markets, or… read more…
Wills
Executor Services: Estate Planning Examples
When someone passes away, the last thing their family should have to deal with is a complicated and drawn-out estate settlement. But without the right executor in place, that’s often what happens. An executor is responsible for carrying out the deceased person’s wishes, settling debts, and making sure assets go where they’re supposed to. It’s… read more…
Estate Tax
How to Use an LLC for Estate Planning: Tax Benefits and Examples
While LLCs are commonly associated with small businesses, they can also serve a purpose in estate planning. Families sometimes use LLCs to hold real estate, business interests, or investment portfolios as part of a broader wealth transfer strategy. An LLC can make it easier to manage assets in one place, simplify the transfer of ownership… read more…
Retirement Planning
Retirement Planning for Doctors: Services and Examples
Most physicians spend their 20s and early 30s in medical school and residency, which means their highest earning years tend to start later than those of other professionals. By the time doctors reach attending-level salaries, many are carrying significant student debt while also needing to make up ground on retirement savings. This combination of competing… read more…
Tax Planning
Tax Planning for Doctors: Services and Examples
Physicians tend to start earning later than most professionals after years of training, and many carry significant student debt by the time they begin practicing. Once they reach attending-level income, however, they often move into higher tax brackets quickly. Whether a doctor works as a hospital employee or runs a private practice also shapes the… read more…
Tax Planning
Tax Planning for Dentists: Services and Examples
Dentists tend to face a distinct set of tax considerations. Most earn high incomes, own practices that generate business deductions, and regularly purchase equipment — all of which can significantly affect their tax liability. Dental practices are also classified as specified service trades or businesses (SSTBs) under federal tax rules, which means certain deductions and… read more…
Life Insurance
Corporate-Owned Life Insurance: Types, Benefits and Tax Rules
Most people think of life insurance as something you buy to protect your family. However, in the corporate world, it serves an entirely different purpose. Corporate-owned life insurance (COLI) is a financial strategy that allows companies to purchase policies on the lives of their employees. The business, not the employee’s family, is the beneficiary. This… read more…
Life Insurance
Bank-Owned Life Insurance: How It Works, Benefits and Tax Rules
Banks are in the business of managing money, but one of their lesser-known strategies involves life insurance. Banks nationwide use bank-owned life insurance (BOLI) to fund employee benefits, boost their balance sheets and leverage favorable tax treatment. It’s a significant asset class in the banking industry, yet most people outside of finance aren’t aware of… read more…
Tax Planning
Charitable Giving Strategies: Tax Planning Examples
The tax code offers meaningful incentives for charitable giving, but many donors don’t fully benefit from them. Without a deliberate strategy, charitable contributions often provide little to no tax advantage. With the right approach, however, charitable giving can reduce income tax through deductions, capital gains tax through donations of appreciated assets, and estate tax by… read more…
Investing for Beginners
Investment Management for HNWI: Services and Examples
Investment management for high-net-worth individuals looks different from standard retail investing. As investable assets grow into the millions, access to a broader range of investment products and services increases. At the same time, greater wealth often brings added complexity, including multiple asset classes, concentrated stock positions, multi-state tax exposure, estate planning considerations and risk management… read more…
Other
Advanced Estate Planning: Real Estate and Investment Portfolio Examples
Real estate and investment portfolios can add complexity to estate planning. These assets often involve title transfers, valuation issues and tax implications that standard documents may not fully address. Wills and revocable trusts help, but they may fall short if you own real estate, hold concentrated stock positions or have investment portfolios approaching federal estate… read more…
Annuities
What Do Financial Advisors Make for Selling Annuities?
Annuities are a common financial product used in retirement planning, but their compensation structure isn’t always easy to understand. Many investors are familiar with the basic concept of exchanging a lump sum for a stream of guaranteed income, but fewer are aware of how financial advisors are compensated when recommending these products. How advisors are… read more…
Investment Taxes
What Is an Exchange Fund? Investment Benefits and Risks
Owning a large stake in a single company’s stock can simultaneously feel like a blessing and a burden. The wealth is real, but so is the risk, and selling those shares to diversify often means handing a significant portion of the gains straight to the IRS. Exchange funds exist precisely to solve that problem. They… read more…
Advisor Basics
Can Financial Advisors Beat the Market? Returns and Risks
The data on market-beating performance is clear: the vast majority of professional money managers don’t beat their benchmarks over the long term. But the real question isn’t whether advisors beat the market. Instead, it’s whether or not they help you achieve better financial outcomes than you would on your own. While a financial advisor can’t… read more…
Advisor Basics
Estate Planning for Married Couples: Services and Examples
Marriage is a partnership in life, and it should be a partnership when it comes to planning for the future, too. A lot of couples assume everything will automatically go to the surviving spouse, but estate laws and beneficiary rules don’t always work that way. Without a clear plan, your family could end up dealing… read more…
Trusts
How to Use a Living Trust for Estate Planning
Planning for what happens to your assets after you’re gone isn’t always easy, but the right tools can make the process smoother for your loved ones. A living trust is one of those tools, giving you a way to manage and transfer wealth with more privacy and control than a will alone. Whether you want… read more…
Advisor Basics
Wealth Management for Women: Milestones, Services and Examples
Wealth management for women focuses on building and protecting wealth in ways that account for the financial realities women are more likely to face. Longer life expectancy, career breaks for caregiving, pay gaps, and major life changes like divorce or losing a spouse can all shape the financial picture over time. And because most women… read more…
Advisor Basics
Wealth Management for Doctors: Services and Examples
Physicians tend to earn well, but the financial picture is often more complicated than it looks. Between high tax exposure, student loan debt, and years of training that delay real wealth building, many doctors start saving later than most professionals. On top of that, decisions around practice ownership, partnership income, and when to retire add… read more…