Monterey Private Wealth
Gary Alt is a financial advisor and co-founder of Monterey Private Wealth. Gary is an Accredited Investment Fiduciary®, CERTIFIED FINANCIAL PLANNER™ practitioner.
Gary focuses on the needs of professionals, business owners and executives. He has expertise in executive compensation including stock options and deferred compensation, retirement plans for professionals and business owners, as well as the unique concerns of affluent families.
He has had his articles published and has been quoted by The Wall Street Journal, USA Today, CBS News MoneyWatch, and other major publications on a variety of financial topics, and contributes articles to his hometown newspaper, the Pleasanton Weekly.
Before co-founding Monterey Private Wealth, Gary co-founded Willow Ridge Capital Advisors, recognized as one of the top 500 wealth management firms in the nation according to Wealth Manager magazine. Prior to forming Willow Ridge, he held numerous management and executive positions in the technology industry. As vice president and general manager at Polycom, he spearheaded the $339 million acquisition of an Israeli company traded on the NASDAQ and Tel Aviv stock exchanges.
Gary graduated with a B.A. in Finance from the University of Wisconsin-Milwaukee and holds a Certificate in Financial Planning from the University of California Los Angeles extension.
He has served as president of his Rotary Club and its Foundation. He is finance chair for the Stanford ValleyCare Charitable Foundation. As a scoutmaster in the Boy Scouts of America, he served as a high adventure leader and as a mentor to those working toward the rank of Eagle Scout. He also worked closely with the chiefs of the local Police Department and Fire Departments to develop a community leadership program through the chamber of commerce.
When he is not working with clients he and his family enjoy many outdoor activities including running, camping, hiking and cycling.
BBA, Finance, University of Wisconsin-Milwaukee
Assets Under Management:
Your reasoning in your example is correct and you ask a good question. There is a lot of confusion and misinformation on this topic on the internet.
The structure (ETFs vs mutual funds) matters less than the investment strategy of the fund. An actively managed fund, whether it's an ETF or mutual fund, will generally produce greater taxable gains than an index fund. In other words, it's the trading activity that will determine the taxes, just as if you held your own portfolio of stocks.
ETF advocates point to a very esoteric benefit called in-kind redemption. While technically true, the true impact to investors is minute.
ETFs started out as passive vehicles, which gave them greater tax efficiency. Recently we are seeing more and more actively managed ETFs and we are also seeing more and more index mutual funds. Therefore, you have to look at the underlying investment strategy to understand its tax efficiency.
Morningstar wrote an article that helps clarify this issue. Untangling ETF Tax-Efficiency Myths
Hope this helps!
That answer is too broad. There are several types of fees that 401k participants could potentially pay - mutual fund fees, recordkeeping, administration, advisory, and transaction fees. It would be difficult for them to pay the mutual fund fees. The company often pays the administration fees, and sometimes the recordkeeping fees. Rarely have I seen an employer pay transaction fees such as if you were to request a loan (if the plan allows loans), or any distribution.
Your employer is required to provide a participant disclosure on fees and expenses. You should ask them for a copy of the most recent fee disclosure document. However, it may be somewhat confusing so you should feel free to ask lots of questions. They are required by law to ensure you understand all fees you pay, and you are smart for asking these questions.
That is a lot of debt for someone preparing for retirement. Worrying about being able to pay the bills in retirement is very stressful. I recommend to my clients to payoff all debt at retirement. This is the most stress-free way to live and gives you a clearer picture of your finances. Your mindset will change once you retire and know that your income is fixed and your savings is being depleted every year, rather than increasing. I recommend you prepare yourself financially for retirement by developing a budget using your income and expense estimates. Depending on the balance of your 401k and your pension and Social Security benefits you might be OK, or you might be headed toward disaster. It also depends on what lifestyle you want during your retirement. You can live like royalty in some parts of the country with $1 million, but in some places that will go quickly. Doing a cash flow budget will help you get a clearer picture.
You absolutely should NOT transfer assets to an account that is not in her name and does not belong to her. That could trigger a gift tax, depending on the amount. It could also lead to other complexities if she claims she never received the assets from you. Transfer the assets to her brokerage account and let her transfer them wherever she pleases.