Latest news with #retirementaccounts
Wall Street Journal
7 days ago
- Business
- Wall Street Journal
Private-Markets Giant Blue Owl Pushes Into 401(k)s
Wall Street firms that invest in private assets are angling for a bigger role in Americans' retirement accounts. Investment firm Blue Owl Capital OWL -3.52%decrease; red down pointing triangle is working with retirement-services provider Voya Financial VOYA -1.12%decrease; red down pointing triangle to develop products aimed at bringing private markets to 401(k)s and other defined-contribution plans, the companies said.
Bloomberg
11-07-2025
- Business
- Bloomberg
Trump's Trade War Pushes Some Canadians to Turn Sour on US Stocks
Canadians have been shunning US products as a result of President Donald Trump's trade war. Now there's evidence some also want to see fewer US stocks in their retirement accounts and pensions funds. Almost half of Canadians — 47% — believe pension managers should be reducing their holdings of American assets, according to a new poll by Nanos Research for Bloomberg News. Just 9% said they think funds should increase their allocations to the US.
Yahoo
17-06-2025
- Business
- Yahoo
The stock market's secret weapon: Insatiable demand from American retirement accounts
Americans are snapping up huge volumes of stock via their retirement accounts, Goldman Sachs says. The TINA trade—which stands for There is No Alternative to stocks—is alive and well, Goldman said. Strategists said they believed hot demand for stocks could help drive the S&P 500 to fresh highs. For US households, there's still no alternative to the stock market. The TINA trade in stocks — which stands for There Is No Alternative — was thought to be waning in recent years as rising interest rates since 2022 boosted bond yields for the first time in years, giving investors another option to lock in steady returns. However, TINA appears to be back in full swing, and the impulse is particularly strong in US retirement accounts like 401(k)s, Goldman Sachs analysts wrote in a recent note. Strategists at the bank pointed to red-hot demand for stocks in US retirement accounts, with total 401(k) allocations to equities in the US swelling to $8.9 trillion in 2024. In 2022, 71% of 401(k) assets were allocated to stocks, up from 66% in 2013. Among account owners in their 20s, the allocation is even higher, with the average investor allocating 90% of their portfolio to stocks, the bank found. Retail traders, meanwhile, have snapped up around a net $20 billion in stocks over the last three months, according to estimates from Goldman's trading desk. Altogether, roaring demand from retirement accounts and retail brokerage accounts paints a healthy backdrop for the stock market. US household demand is a key pillar of strength for the market, the bank said. US households have raised their total stock allocation to 49% in recent years, the highest level on record, and the bank said it expects households to directly purchase $425 billion in equities this year. Those are signs that the TINA trade is in full swing, a major bullish catalyst for stocks, strategists said "TINA trade remains alive and well in US retirement accounts," a team of strategists led by David Kostin wrote in a note on Friday. "We believe that persistent household equity demand and high allocations to equities will continue to support elevated equity valuations. However, the bank also notes that the top 10% of households by wealth represent 87% of household equity ownership, meaning demand is being driven by a relatively small slice of the population. The analysts added that an even smaller group—the top 1%—has been the primary driver of equity demand in the last 30 years. The bank anticipates the S&P 500 rising to a record high of 6,500 over the next 12 months, implying 7% upside from the index's current levels. Goldman recently lifted its year-end price target for the S&P 500 to 6,100. Previously, the bank slashed its target for the index to account for the impact of tariffs, but has since lifted its economic outlook amid the easing trade tensions and progress on negotiations. Read the original article on Business Insider Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
16-06-2025
- Business
- Yahoo
The tax benefits — and complexities — for business owners hiring kids
Business owners who employ their children in a reasonable but limited capacity at their firms can rake in tax savings and start their kids' first retirement accounts in the process. But the entrepreneurs and their financial advisors or tax professionals must ensure they're diligently keeping the kids' employment records, complying with some variation in state-level rules for business entities and addressing any other potential ramifications, according to Miklos Ringbauer, of Los Angeles-based MiklosCPA, and Kevin Thompson, CEO of Fort Worth, Texas-based RIA firm 9i Capital Group. READ MORE: 24 tax tips for self-employed clients For instance, Ringbauer usually advises clients to restrict their compensation for any summer jobs or other employment for their children to less than $15,000. That's the standard deduction for 2025, the highest amount of income that, in most cases, doesn't carry the requirement to file a return. In turn, the business may deduct the wages as an expense and often avoid Social Security, Medicare, Federal Insurance Contributions Act (FICA) and Federal Unemployment Tax Act (FUTA) taxes, as well as estate and gift duties. And the child acquires some invaluable lessons about a day's work, alongside potential investments such as a Uniform Transfers to Minors Act (UTMA) portfolio with a parent as the custodian or a Roth or traditional individual retirement account. But the benefits won't accrue from brazen attempts by parents to give their kids money. "There's an incredible wealth of information out there and options a business owner and their children can take advantage of legally to help reduce taxes on the parents' side," Ringbauer said. "This could be an incredible wealth transfer, if it is done right and done appropriately." For advisors and their clients, that entails using the same payroll records as they do for any other employees and assigning the kids to perform actual work aligning with their hours and skills. And, of course, they need to "be careful" that they're not running afoul of guidelines for child labor or the so-called kiddie tax on unearned income or investments, Thompson noted. "You can't pay your kid $15,000 over the summer for raking leaves. It has to be reasonable compensation, and you have to have them in your system," he said. "Having the IRS come into your place just because you paid your kid some money over the summer is not a good look." READ MORE: The basics of S corporations — and the pitfalls for small businesses Whether they're working for their parents or another employer, a summer job can introduce young people to concepts such as the difference between an independent contractor and a W-2 employee and any wittholdings from their paycheck, according a recent guide to IRS rules for teens by Jill Kenady, a tax materials specialist with the University of Illinois Tax School. Documents like a tax checklist compiled by the school, and IRS releases for students and summer employees could aid parents and youngsters navigating the rules, Kenady wrote. "Summertime is near, which means teens will start jobs, which is the initiation into adulthood," she wrote. "These jobs offer a sense of independence along with a wonderful way to earn their own money. However, with great earnings come significant responsibilities, specifically tax responsibilities. It is your job as a tax practitioner to help teens and their parents navigate the tax laws and the impact of summer employment." The advantages to parents who employ their kids can pile up so high that Ringbauer said he begins speaking with business owners about the possibilities shortly after the child is born. As long as they comply with the rules, a pediatrician or a child dentist could consider hiring their kid to act as a model for advertisements or pictures on the website for the small business, he noted. On the other hand, Ringbauer stressed that it's important for the parents to talk through their ideas with an advisor or tax pro before putting anything in motion. The entity classifications of a business and independent contractor or W-2 employee status for the child could bring more complexity to their decisions. Then there are the more basic concerns about any potential for accidents on the job or the challenges of a parent working in the same office as their child. READ MORE: 3 tax strategies for summer daycare, jobs and vacation rentals Among prospective clients, the most common problem is that it can look like a business owner is trying to simply transfer money to their child "without actual work or suitable work," Ringbauer said. "Eventually, they didn't turn into my client, because they didn't like the answers I gave them," he said, recalling one business owner who was trying to skirt the rules. "After-the-fact errors are the biggest pitfalls, and it's across the board." However, the array of potential strategies for small business owners provide "limitless reasons and opportunities to do it right, and the benefits significantly outweigh the immediate gratification of savings in dollars," Ringbauer added. The incentives explain why the method "makes a lot of sense" for many business owners and kids who could open their own retirement accounts, Thompson said. But there are some caveats. For example, those assets could affect possible financial aid for college or other benefit programs that take net worth into account. "We have to look at the implications on them saving dollars under their own names," Thompson said. "I have to be careful, because if they have too much money under their name it could ruin their benefits." Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
08-06-2025
- Business
- Yahoo
Suze Orman: 2 Ways for Retirees To Manage Multiple IRAs
Juggling multiple individual retirement accounts (IRAs) can get complicated. 'If you have multiple traditional IRAs, you are setting yourself up for some potential headaches once you reach the age where you must begin to take required minimum distributions (RMDs),' financial expert Suze Orman wrote in a recent blog post. Depending on the year you were born, this age is either 73 or 75. If you're currently retired, but haven't reached the age when you are required to take distributions, take note of these strategies now to make managing your multiple IRAs simpler. Check Out: Read Next: If you have multiple traditional IRAs, the best way to make managing them easier is to roll all of your accounts into one. 'You can move money from one traditional IRA into another traditional IRA without any tax bill,' Orman wrote. 'It's just a rollover. If you have multiple traditional IRAs at the same brokerage, call them and you might be able to consolidate all of them with just a phone call. 'If you have traditional IRAs at different brokerages, decide which one you want to keep, and then ask for rollover instructions from the brokerage you will move your money out of.' The money should be transferred directly from one account to the other — otherwise, there may be tax implications. Consolidating your accounts is the strategy Orman recommends if you currently have multiple IRAs. 'The less you have to keep track of as you age, the easier you are making it for an older you, and anyone who might eventually step in and help manage your finances,' she wrote. 'One big traditional IRA account that simplifies your life to one RMD is a wise retirement move.' See More: If you don't want to consolidate your accounts, your other option to make things simpler is to take your total RMD amount from one account instead of having to take distributions from each. 'For instance, if you have four IRAs, calculate the RMD for all four. (Your brokerage will have a free online tool to help with this. It's an easy calculation.),' Orman wrote. 'Then, add up all four.' The example Orman gives is that you have an IRA with an RMD of $2,000, an IRA with an RMD of $4,000, an IRA with an RMD of $2,500 and an IRA with an RMD of $3,500. That means in total, you must withdraw $12,000. 'If you want, you can take a $12,000 RMD from one of the IRAs,' Orman wrote. 'All the IRS cares about is that you satisfy your total RMD obligation.' This move allows you to be more strategic. 'This strategy can be helpful if you invest your IRAs a bit differently,' Orman wrote. 'In years when stocks are down, you might want to avoid taking the RMD directly from an IRA heavily invested in stocks, and instead take it from an IRA with cash or bonds.' More From GOBankingRates Here's the Minimum Salary Required To Be Considered Upper Class in 2025 This article originally appeared on Suze Orman: 2 Ways for Retirees To Manage Multiple IRAs
