Domestique Capital LLC
Damon Gonzalez, CFP®, RICP® has been serving clients since 2000. After almost ten years at Ameriprise Financial Services, he founded Domestique Capital in November of 2009. Damon has been a CERTIFIED FINANCIAL PLANNER™ practitioner since 2004 and has extensive knowledge in investments, taxes, budgeting, and insurance. He obtained the Retirement Income Certified Professional Designation in 2015. Damon was recognized by D Magazine as one of the Best Financial Planners of 2010 and 2015 as chosen by his peers. Damon has also been awarded the Five Star Wealth Manager Award in three different years as seen in Texas Monthly.
Domestique is the French word for servant and one of Damon’s favorite quotes is “I don’t know what your destiny will be, but one thing I do know: the only ones among you who will be really happy are those who have sought and found how to serve” – Albert Schweitzer.
In addition to serving, Damon loves seeking the truth and is a lifetime learner. One of his favorite things about his profession is that there are always complicated puzzles to solve and markets are ever changing. He graduated from the McCombs School of Business at The University of Texas at Austin in 1999. Outside of work, he enjoys traveling, cycling, volleyball, basketball, reading, and spending time with loved ones. Damon has been married to his wife, Kim, since 2007 and lives in Downtown Plano, Texas with their three dogs.
BA in Business Administration, The University of Texas at Austin
Assets Under Management:
Percent of Assets or Monthly Subscription Fee
Domestique Capital, LLC is an Investment Adviser registered with the State of Texas. All views, expressions, and opinions included in this communication are subject to change. This communication is not intended as an offer or solicitation to buy, hold or sell any financial instrument or investment advisory services. Any information provided has been obtained from sources considered reliable, but we do not guarantee the accuracy or the completeness of any description of securities, markets or developments mentioned. We may, from time to time, have a position in the securities mentioned and may execute transactions that may not be consistent with this communication's conclusions.
It does not count toward your $18,000 limit or $24,000 limit if you are over 50. Many people do not realize that there is a $53,000 limit that you AND your employer can contribute to a 401(k) per year. The company match does count toward the $53,000 limit. Very few people get a match high enough to worry about this rule. It sure would be nice to get a $35,000 match on your 401(k) plan.
I would definitely consider taking a loan from a current retirement plan before making a withdrawal that has a 10% penalty and taxes. The downside is that you will need to have the income to pay the loan back. You could also look into taking Substantial Equal Periodic Payments from an IRA using rule 72(t). This would allow you to take the same amount from an IRA each year until you turned 59.5 or five years, whichever is longer, and avoid the 10% penalty.
Depending on the size of your account and age, 72(t) distributions may not be enough to meet your needs. The rules can be complicated so make sure to work with a tax professional to get it right. One small mistake could make all of the IRA withdrawals subject to the 10% penalty.
The other answer has some good advice. The only thing that I would add is that cash or money markets can be a good investment during recessions. If real estate were to drop 20% and stocks were to drop 30%, your cash would buy you 20% more real estate and 30% more stocks. Don't just look at the tiny current yield on cash--look at it as an opportunity to buy assets when they are on sale again.
I am also with you that the U.S. is way overdue for a recession. Who would have predicted that the expansion would have lasted this long, oil would be a $50, and there would be trillions of dollars of negative yielding bonds? I would caution you in trying to time the markets. Markets anticipate, so if you expect a recession 9 months from now, the stock market might peak in one month. You also have to be right TWICE (on the sell and buy). Studies and experience have taught me that it is extremely hard to successfully time the markets over the rest of your lifetime. Even though I am concerned about how long stocks have risen, I am not going to change anything with my investment strategy. My very best investment advice can be found in this short article: https://domestiquecap.com/things-ive-come-know/
The other advisors have offered some great advice. The only thing that I would add, is that you may want to consider consolidating these IRAs for a few reasons:
1. It can be a hassle to make so many different calculations each year and the more complexity the bigger chance for error.
2. I have dealt with several client deaths and it is not fun for your beneficiaries to contact each IRA custodian and fill out each custodian's forms.
3. As you get older and your mental capacity diminishes, this will get harder to manage.
The only other thing that I would add is that I believe it is very important to have cash or safe bonds in your IRAs. You may not make much money on these investments over long term, but they will allow you a place to pull from to take your RMD the next time the stock market is down 20-50%. This will give you the best chance to allow yourself time to make up the losses in your stock/stock funds.
If you are closing the entire position, it does not matter what cost basis method you choose. If you were selling a portion of your fund, there would be advantages and disadvantages to the methods.