Many investors were glad to see the end of 2022. But whats ahead this year? And what moves can you make in response to last years results? To begin with, heres what happened: 2022 was the worst year for the financial markets since 2008, with the Dow Jones Industrial Average dropping nearly 9%, the S&P 500 losing more than 19% and the technology-heavy Nasdaq falling 33%. Several factors contributed to these results, including the moves by the Federal Reserve to aggressively hike interest rates to combat inflation, the Russia-Ukraine war, recession fears and increased concern over COVID-19 cases in China.However, 2023 may be different. Many experts believe that inflation may moderate considerably, especially during the second half of the year. If that happens, the Fed may well pause its interest rate hikes and perhaps even consider cutting rates a move that is often positive for the financial markets. Also, if a recession emerges, but its relatively short and mild, as expected, the rebounding economy may be favorable for the investment outlook.   Regardless of what transpires this year, though, you can help move toward your financial goals by following some basic steps that make sense in all investment environments. Here are a few to consider: Focus on the long term. It can be disconcerting to look at investment statements containing negative results, as was the case for many people throughout 2022. But its important to view a single years outcome in the larger context and historically, the stock market has had many more positive years than negative ones, though, of course, past performance is not a guarantee of what will happen in the future. In any case, its generally not a good idea to overreact to short-term downturns and make moves that could work against your long-term strategy. Keep adequate cash in your portfolio. The value of your investments may have gone down in 2022 but you didnt really sustain any actual losses unless you sold those investments for less than what you paid for them. To avoid having to sell investments to supplement your income or to pay for unforeseen costs, such as a major home or car repair, try to build the cash portion of your portfolio, so it covers a few months worth of living expenses. When youre retired, and it becomes even more imperative to avoid selling investments when their price is down, you may need an even bigger pool of available cash. Look for opportunities. Although 2022 was certainly a down year for the financial markets, some developments have presented new opportunities for investors. For one thing, the contribution limits have increased for IRAs, 401(k)s, and Health Savings Accounts (HSAs), all of which are pegged to inflation. Also, with interest rates considerably higher than they were a year ago, fixed-income investments may offer more income and provide added stability in portfolios during times of economic weakness. When youve been investing for a long time, you will experience down years in the market, such as the one in 2022. These years are an inevitable part of the investment process. But since you cant control what happens in the financial markets, you need to concentrate on what you can control and that may be a lot more than you think. Chad Choate III, AAMSEdward Jones828 3rd Ave W. Bradenton, FL 34205941-462-2445  chad.choate@edwardjones.com

Saving is the usual buzzword when it comes to planning for your post-work years. But accumulation leading up to retirement is only half the storyunderstanding how the funds will be dispersed is the other crucial, yet often overlooked, aspect of the planning process. While a recent Prudential study[1] notes that there are more people than ever before retiring and entering the distribution phase, their knowledge about this delicate period of managing investments and coordinating withdrawal strategies is often limited, and could be costly. When youre over the age of 50, you need more than a pie chart, you need a distribution plan says Darian Andreson, principal of Senior Tax Advisory Group, a financial planning firm located in Colorado Springs, Colorado. There are approximately 10,000 people retiring every day. Of these retirees polled, the number one concern consistently shared is that they fear running out of money in retirement. It seems there is too much emphasis today on the diversification of portfolios and pie charts, and not enough time and attention spent on how to coordinate and fund quality of life in retirement.  No one can control when the next major market correction will occur, but there are dozens of critical things that a retiree can control, which can result in hundreds of thousands of extra dollars in their pocket, giving them a far better opportunity to address the fear of running out of money.Since many of these retiring baby boomers will rely on social security as a good portion of their post-retirement income, understanding how the system works and how various decisions that will impact the amount of benefits received make it vital to get good information prior to distribution time. The revelation of Social Security is not so much about when you file, as much as it is about how you file, comments Andreson. When a plan is properly designed, we regularly see families receive a few hundred thousand extra dollars in Social Security benefits over a lifetime, in addition to tens of thousands of dollars in tax savings based on the tax favorable nature of these benefits becoming a larger part of their income distribution plan.In addition to designing a plan to maximize benefits, taxes are another important planning consideration. Although social security income is not taxable in and of itself, other income sources like withdrawals from 401ks or pension plans can cause our social security benefits to become taxable as high as 85%. For most, what they pay in taxes will represent the single largest expense they will have in retirement, just next to healthcare says Andreson.  Changes in the tax codes, also greatly affect how much tax retirees will pay on their income, so staying abreast of these types of changes and how they affect social security as well as other types of savings vehicles is also a key to keeping more money in the bank and seeing less going to the IRS.With so many moving parts to the retirement planning equation, Andreson emphasizes the importance of enlisting the assistance of a planner, particularly one who focuses on the distribution phase. Do-It-Yourself is too expensive when it comes to retirement planning. Though a bit of money is saved in the short-term, the unfortunate reality is that this type of planning can be both difficult to quantify and to properly execute, so mistakes are easy to make. There are no do-overs, so getting it right from the start makes all the difference, he says. And what exactly should a distribution plan consider? Of course, the most obvious consideration is ones planned age at retirement versus ones life expectancy. If an individual retires at 65 and lives until 90, his or her money has to last for 25 years. Its surprising how a simple thing like estimating life expectancy and the need to coordinate a plan to fund the needed after tax income is so rare in todays world of planning, Andreson remarks. Its likely because no one likes to think about mortality, but this is something that cant be avoided when talking distribution. Other important considerations include estate planning, inflation, the rising costs of healthcare and prescriptions in conjunction with a rising need for them as we age, all of which should be explicitly discussed and mapped during distribution planning.Whatever the particular considerations and whatever form the conversation about distribution takes, it has to happen and should be an ongoing part of the planning discussion. The bottom line is that no one should feel comfortable calling him or herself a retirement planner if he or she doesnt include Social Security maximization, withdrawal strategies or tax implications in their planning process. Putting these missing pieces together in the puzzle can make all the difference in the world. For more than 2 decades, Darian Andreson, CSA, has been guiding (and educating) retirees as they transition into retirement. Darian is the CEO of Colorado Springs Senior Tax Advisory Group a Registered Investment Advisory Firm and Insurance Agency.Website: www.SpringsTax.com

It's tough to know when you should step in and help your parents with their finances. You may go back and forth about when to take over. Deciding whether your parents still have the cognitive ability to manage their money is a difficult call to make. A recent report reveals why it may be important for you to get involved.The Study Results An analysis published in September 2022 showed that seniors with cognitive impairment are struggling to handle their financial affairs. Reviewing a survey of 8,800 men and women aged 65 and older, the researchers found that seniors continued to maintain control over their finances even when experiencing some sort of cognitive decline. In the population studied, almost 14 percent of these older adults suffered from cognitively impaired nondementia (CIND). Another 6 percent were experiencing dementia. The study reported that cognitive impairment problems disproportionately affected groups who reported having less education or who identified as a member of a racial minority group.  Does Your Parent Show Signs of Cognitive Impairment? There are some signs that may indicate diminished cognitive ability. Watch out for the following if you suspect your parent is experiencing diminished mental capacity: Your parents are confused and get lost in familiar places Your parents may lose their train of thought throughout a conversation with you Your parents are more forgetful Your parents forget about important events (like birthdays, holidays, and doctors appointments) Your parents are making impulsive decisions Are Your Parents Financial Resources at Risk? If your parents have a large estate, you should take care to determine whether they have any cognitive impairment. The study found that many of the men and women surveyed had large amounts of money or property valued at more than $100,000. Risky financial assets, like valuable stock portfolios, may be particularly susceptible to mismanagement in those with cognitive impairment, the researchers state.What Can I Do For My Parents? Ensuring that your parents are properly cared for as they age is a priority for many children. However, knowing what you can do for your parents finances if they have any cognitive impairment is hard. If you suspect your parents are having a difficult time managing their money because of a cognitive deficiency, consider the following.  Get Them Screened for Cognitive Impairment The best first step is to confirm your suspicion with a cognitive impairment screening. Typically, patients are asked simple questions about themselves and their surroundings, including their name, address, the time, and to recall information. Learn more about cognitive assessments from the Alzheimers Association.Find Financial Counseling You may need professional assistance to ensure your parents affairs are handled appropriately. You may want to speak to an accountant if your parents estate is extensive and includes many assets. If you suspect cognitive impairment, but haven't confirmed it, you may wish to appoint a power of attorney or a financial agent to handle your parents financial affairs.