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Financial Guidance

Financial Guidance

What is financial guidance? Financial guidance is a life-long process that assists you and your family in taking control of your financial future, building your lasting legacy. Financial guidance starts with a comprehensive financial plan that is rigorously evaluated throughout the existence of the plan.

  • Our mission at Heck Capital is to help define your family’s goals for the future and navigate a path to achieve them.
  • We guide you through a personalized investment analysis, ask detailed questions about your risk tolerance, cash flow needs and long-term focus to map out customized financial strategies, solutions and a detailed plan to help you take control of your financial future.

 

Did You Know?

 

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Integrated Financial Guidance and Investment Solutions delivered with the special care, attention, and high tech resources needed to protect and grow your wealth.

  • Our Advisors focus extensively on ensuring a seamless transition of wealth and legacy between generations. Each generation faces its own unique set of challenges and opportunities and our long track record of advising clients through good and bad markets uniquely positions us for the road ahead.

 

  • We truly believe the need for sound financial guidance has never been stronger as the world’s largest demographic –the Millennial generation– grapples with soaring education and healthcare costs, rising debt levels, and little-to-no retirement savings (see graph to the right). We stand ready to help ease the transition to the next generation.

 

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Our Advisors understand how important it is for our clients to be able to access and update their goals and objectives 24/7. Our interactive investment management platform offers exactly that - clients can review the progress of their financial future anytime, anywhere. Learn more about CapitalCENTRAL®24/7

Holistic Financial Planning

At Heck Capital, we work with our clients to address all aspects of their financial life, including the topics shown below. 

 

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Real Estate

Should I refinance or payoff my mortgage?

Retirement Planning

How much can I afford to spend in retirement?

Estate Planning

How can we better manage our income?

I want to leave a legacy; how much should I give now vs. after I'm gone?

Philanthropy

What is the best strategy for my philanthropic goals?

Should I consider a donor advised/charitable giving fund?

Education Planning

Do I have enough saved for my child's/grandchild's education?

Business Planning

How do I transition my business or practice so I can retire?

How can we better manage our cash flow?

Portfolio Analysis

Are my investments structured for the future?

Research

Are my investments thoroughly researched and analyzed?

Investment Selection

Are my investments working together to meet my long-term goals?

Monitoring

Is my portfolio protected from future market movements?

Corporate Benefits

How do I maximize my benefits from my business to align with my personal goals?

Efficiencies

Are we using the most cost-effective investment solutions?

How can we lower our investment fees?

 

At the outset of each relationship, we assess the clients' ability and willingness to take risks as well as their financial objectives and constraints to identify the most appropriate solutions.

Risk Assessment Questionnaire

Legacy Planning

The stakes are higher than ever before. Over the next 30 years, it is estimated that $30 trillion will be passed from Baby Boomers to their children and grandchildren. This is an unprecedented level of wealth transfer -- the largest intergenerational wealth transfer in American history -- which will lead to a period of transition for many investors.

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Are you ready? Unfortunately, most people are not prepared for their legacy. Please consider the research findings below:

  • One in three Americans do not have the proper estate planning documents created to transfer wealth according to their wishes.
  • Depending on your state, the median annual cost of nursing home care is between $75,000 and $120,000.
  • Nearly 4 in 10 Americans age 60 and above that hold student debt (as they borrowed for their children and grandchildren), skipped healthcare needs in 2014.
  • Generation X (1966-1980) and the Millennial generation (1981-1995) represent only 10% of assets currently managed by the retail wealth management industry.
  • The estimated four-year college cost of a public university in 2035 is over $200,000 dollars, with private education projected to cost more than double that amount.
  • Total U.S. household debt reached a record level in 2017 of $12.7 trillion (higher than 2008’s peak).
  • Adjusted for inflation, the net worth of Americans age 55-64 is lower than it was back to 1989 for the same age group.
  • Probate costs Americans billions of dollars every single year, which is money that could be passed on to beneficiaries with proper planning.

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Planning Your Legacy

Legacy planning is the process of creating a well-defined strategy to ensure your wealth and core values are transferred to the next generation in the most tax-efficient and secure method possible based on your goals and intentions. There is no cookie cutter approach to planning your legacy as the optimal legacy plan will be different for each individual and family.

At Heck Capital, we recognize many people are not prepared to plan their legacy. Planning for life beyond death is not an easy topic to discuss and family dynamics can make the conversation even more difficult. Regardless of your family situation, estate size, or long-term goals, confronting basic elements of legacy planning early on in life may pay significant dividends in the future.

Wondering how to start planning your legacy? The initial legacy planning discussion with our clients begins by addressing the following topics:

1. Assessment of financial goals and needs
2. Discussion of core values and family/cultural beliefs
3. Determination of beneficiaries of legacy assets
4. Discern intentions for the distribution of assets during and/or after life
5. Review legacy planning and document preparation already completed
6. Analyze investment account types and size of estate

Once we understand our clients’ goals, our Advisors can begin the planning process. Heck Capital will help you successfully organize your legacy, transition it to the next generation, and provide resources to help maintain your legacy for decades to come. Our resources cover inheritance planning, charitable giving planning, estate planning, education planning, Millennial investment strategies, final arrangements planning, and more.

With more at stake than ever before, don’t wait to begin planning your legacy!

Frequently Asked Questions

Our Advisors work diligently to ensure our clients have a peace of mind. We communicate proactively to prepare for the future and we deliver prudent financial advice. Have you been thinking about your financial life?

Here are some of the most frequent topics our clients are asking us right now:

 

What are some options for Long Term Care (LTC) coverage?

One of the more difficult challenges facing the baby boomer generation is developing a strategy for Long Term Care. With the average costs of nursing homes or assisted living care facilities at approximately $100,000 per year, we see the following strategies being utilized to approach LTC:

  • Pay out of pocket. Self-funding is for the financially fortunate. It is especially attractive to those who don't wish to buy Long Term Care insurance (see below) or who would be turned down for medical reasons. Paying out of pocket is becoming less practical for Americans as healthcare costs continue to outpace inflation.
  • Qualify for Medicaid by spending down. For many people of modest means, even a short-term partnership policy may not make financial sense. People in this category would likely exhaust their assets and qualify for Medicaid coverage of any nursing home costs in a short-term time frame.
  • Get a reverse mortgage. Some counselors advise covering Long Term Care costs with a reverse mortgage instead of taking out a home equity loan, which poses the risk of losing the home if payments can no longer be made. With a reverse mortgage, homeowners draw on the equity, but payment on the loan is deferred until they move out or die.
  • Buy Long Term Care insurance. A Long Term Care policy pays a specified daily amount for nursing home care for a specified number of years or for the policyholder's lifetime. It typically covers care in other settings as well, such as the home or an assisted living facility.

How much money can I gift to my children this year? What is the most tax-efficient strategy?

The annual gift tax exclusion for 2019 remains at $15,000 per donor per beneficiary. A married couple can elect to split gifts, meaning that they can combine their annual gift exclusion and effectively give $30,000 per beneficiary. In combination, if the child is married, you may gift the annual exclusion ($15,000 if single or $30,000 if you elect to split the gift) to both the child and their spouse making an effective gift of $60,000. Any amount above these numbers is over the annual exclusion and will begin to reduce your unified credit.

There are several vehicles in which someone may gift to children. Our Advisors most frequently encounter gifts made for education or for transferring property. These two gift giving strategies are detailed below:

  • Section 529 Plan: In a 529 plan, the plan holder makes a contribution that allows tax free withdrawals if used for qualified education expense (tuition, room and board, textbooks, etc.). Gifts to a 529 plan are limited to the annual exclusion of $15,000 (2018) per donor without using the unified credit. There is an exemption that allows a donor to make a lump-sum contribution to a 529 plan of up to five times the annual exclusion amount ($75,000) and avoid using any of the unified credit. Funds that are not used by the beneficiary may be transferred to another child and almost anyone can make a contribution (not just parents or guardians) into a 529 Plan. The maximum individual 529 plan account limit is around $250,000; however, this amount varies state by state commensurate with the estimated costs of qualified higher education expenses.
  • Uniform Transfers to Minors Act (UTMA): A gift giver may transfer money, securities, or property to a minor (up to $15,000) without the minor incurring tax consequences of the gift until he/she turns the legal age. The minor takes full ownership of the gift immediately upon gifting and ownership is irrevocable.

What are Required Minimum Distributions (RMDs)? When do I need to take mine?

Starting at age 70½, owners of a Traditional IRA, SIMPLE IRA, SEP IRA, or retirement plan account must begin making withdrawals, also known as required minimum distributions (RMDs), from their accounts. These withdrawals are mandatory and violations incur severe penalties. There is no RMD requirement for Roth IRAs during the lifetime of the original owner. If you have an inherited IRA, there are different rules for those inherited assets and you may be required to begin distributions by a certain date. Helping clients understand their RMD requirements is part of the comprehensive financial guidance we offer at Heck Capital Advisors.

I would like to donate to a charitable cause or Foundation. What are my options if I’m philanthropically inclined?

We see more of our clients taking advantage of donor advised funds which provide a charitable contribution to help tax planning and provides the ability to grow money over time. This allows for more potential money to charities in the future and generally results in an immediate tax deduction when making a contribution of cash, securities, or assets. The advantage of this type of charitable giving is that it is a cost effective and there is no obligation to gift a certain percentage or amount each year. Moreover, with donor advised funds, one can diversify and invest according to his/her asset allocation preferences and objectives. Additionally, in order to help simplify our clients’ financial lives, we can also help facilitate the grant to the 501(c)3 organization once it is decided. Thus – tax efficiency, cost effectiveness, and simplification all apply when considering a charitable contribution through a donor advised fund option.

What are the most common mistakes people make in estate planning?

One of the most common mistakes we see is when assets have not been properly titled or when beneficiaries are not updated across various accounts. This is especially relevant over the course of a lifetime where big life events – such as divorce, birth of children, or remarriage – alter the designation of previously selected beneficiaries. Unfortunately, unless those beneficiaries have been updated, an ex-spouse may receive a retirement account at the account owner’s death instead of the account owner’s children or a new spouse if desired. The best way to avoid unintended consequences at death is to review your beneficiary information across all accounts yearly or more frequently following major life event changes.

What’s the difference between a Traditional and Roth IRA?

Both Traditional and Roth IRAs are instruments for retirement savings. In the case of both Traditional and Roth IRAs, the maximum annual contribution allowed for investors under age 50 in 2019 is the lessor of $6,000 or 100% of compensation. A catch up provision of $1,000 is allowed for income earners over 50 years.

In a Traditional IRA, contributions grow tax deferred until withdrawal. Withdrawals made before age 59.5 are subject to a 10% penalty with limited exceptions. A Traditional IRA investor must take required minimum distributions beginning at age 70.5, which is also the cutoff age for contribution eligibility. Earners of all income levels may contribute to a Traditional IRA account.

In a Roth IRA, contributions are taxed when made and withdrawals are made tax free. There is no minimum age for making withdrawals and no penalties assessed upon withdrawal. As long as an individual has employment income, he/she may continue to contribute to their Roth IRA account; however, high income earners may be precluded from making contributions to a Roth IRA subject to income eligibility limits. Earnings may be tax free at the federal level as long as the Roth IRA has been open for a minimum of five years.

 

*    J.P.Morgan Asset Management, 2017. Guide to Retirement. 
**  Kirkham, Elyssa. (2016, March, 16). 1 in 3 Americans Has Saved $0 for Retirement.
***  Lenok, David. (2017, February, 1). Americans Aren't Ready For The Great Wealth Transfer. 
Graph: Source: BLS, Consumer Price Index, J.P. Morgan Asset Management, Date represents cumulative percentage price change from January 1983 – August 2016

 

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Rhinelander
15 E. Anderson Street
P.O. Box 738
Rhinelander, WI 54501

 

Phone: 715-361-1500
Fax: 715-361-1515

 

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833 E. Michigan Street
Suite 1460
Milwaukee, WI 53202

 

Phone: 414-509-6630
Fax: 414-509-6633

 

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West End Plaza
1660 S. Highway 100
Suite 500
St. Louis Park, MN 55416

Phone: 877-432-5330 (toll-free)

 

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