Managing Your Financial Future with Lucia Capital Group

What's the most important quality an investor could have? Some people would say it's the ability to achieve the highest rates of return possible over the longest period of time possible. But those people are wrong. It's the survival instinct - especially over the short term. Too many investors are so busy jumping in and out of stocks as trends and markets fluctuate that they end up...

A steady cash flow stream is one of the most valuable things you can have, both before and after you retire. Pensions guaranteed by the PBGC and Social Security are two forms of this "protected income," and are designed to pay you as long as you live, regardless of current stock market conditions.   But if you don't have a pension, or your Social Security isn't enough to cover...

In our previous episode, we answered 5 of your most common questions about The Bucket Strategy®. Those covered some of the more "basic" elements of the strategy, but they're important to know in order to understand the deeper meaning of Buckets. This week we're answering a few more, but these questions are what we might call the "next level up" from basic, including:...

We've been talking about The Bucket Strategy® for decades, and over that period of time, we've received thousands of questions about how the strategy works: what it does, when the buckets should be refilled, and how it works when interest rates rise or fall, among others. People's questions about The Bucket Strategy® generally range from the very basic to the extremely sophisticated...

How is it possible that two individuals could retire with the exact same portfolio allocation and use the exact same withdrawal strategy, and yet one is still going strong after 40 years while the other is completely destroyed before year 10? The problem comes with the uncontrollable element of investing: the stock market itself.  What happens with the markets in the first few years after retireme...

Have you heard of the "Gift Tax?"  Many people are at least familiar with the term, but relatively few know how, when, or where it might be applied.  Generosity certainly has its benefits, but is there also a tax that someone should be paying? The answer is both yes and no.  And it all depends on a few important factors.  Knowing how the gift tax works can be especially helpful when it c...

For many people, the 401(k) is their largest source of retirement savings. Because of that, it may be tempting to tap into some of that money in the form of a loan if you need some quick cash. But is that smart?  Maybe - but only if you're aware of the rules and the potential pitfalls of borrowing from your plan.  While it can provide you with a certain amount of temporary money, if you don&a...

After years of building your savings, there are a number of scenarios that threaten to deplete it. But what happens if you retire just when the stock market takes a big downturn? If you're selling stocks to provide yourself with an income, you're courting disaster. Of course, you have to have an income, and maybe a portion of that income has to come from your savings and investments. And...

The first trading two weeks of March, 2025 were brutal for stocks. Nearly $4 trillion of value was lost in less than a month.  All of this negative volatility, with suspicions that more is to come, has created a great deal of fear and panic among savers who don't want to see their gains wiped out. What many people don't understand, though, is that volatility by itself is not risk. The ri...

In the middle of 2024, the rules changed for people who become beneficiaries of an IRA.  We devoted an entire episode to those changes at that time, but there's a lot more you need to know if you're planning on inheriting a tax-deferred account like a traditional IRA. While it's always nice to inherit assets of any kind,  there are rules you need to be aware of.  Depending on when t...

Several weeks back, we talked about how different types of retirement income are taxed. This topic created a follow-up question from several listeners who wanted to know: Will I be in a lower - or higher - tax bracket in retirement? You might think that once you begin retirement, your tax bill will tend to go up at first, since people normally have much (if not most) of their retirement funds in a...

The US tax system is by design a complicated beast, and trying to understand it all is a daunting challenge.  And yet, unless you understand how the tax brackets work, you may be paying a LOT more in taxes than you actually owe. Most taxpayers assume that the amount of tax they pay is determined by which tax bracket they're currently in.  This is both a true and untrue statement.  If you&apos...

You've probably heard that your Social Security benefits are subject to taxation.  You may have also heard that they're never taxed at all. Is it possible that both scenarios are true? The fact is that under current law, sometimes a recipient's Social Security benefits will wind up being taxed under certain conditions, while others may never pay a dime on their benefits at all, even...

For many people, the 401(k) plan has become the default retirement savings plan. Opting in early enough, combined with consistent contributions over a long period of time, may yield very good results.  Thus, it's an important saving vehicle. But the setup, rules, options, and investments of a 401(k) are often extremely confusing.  Is there a match? What does the match percentage mean? What do...

Having money in a Roth account can be great - especially if the cost to get that money in there is minimal.  But there are some people who cannot contribute to a Roth IRA because their annual income is too high.   Wouldn't it be great if you could not only get money into a Roth without worrying about the income limits, but also be able to fund a lot more than the $7,000 or $8,000 that is curr...

It’s been said – by us – that keeping your wealth can be a much harder task than accumulating that wealth.  And it's true.  If you don't have the right withdrawal strategy when taking cash flow from your investment portfolio, you stand a real risk of running out of money. What methods do people use when they're taking money out?  And which, if any, may potentially be the best way to...

It's the start of a new year, which means right now is a very good time to begin thinking about what your financial goals are for 2025.  Sometimes, though, that's easier said than done. How do you know what to prioritize this year?  What sort of goals should you be setting, and how do you know if those goals are both reasonable and attainable? And what's the best way to get started?...

Many retirees have several sources of retirement income: IRAs, 401k accounts, personal money, pensions, and Social Security, to name just a few.  Because of this, they may find that it's extremely hard to predict their tax bill each year if they're not sure how - or if - these sources of income will be taxed. Knowing the potential taxation of your income can put you in a much better posi...

When the SSA sends you your benefit projections each year, there is an actual amount that they're telling you that you will receive, depending upon what age you begin taking them.  So you might think that the number they tell you is the amount you'll be receiving. But this is not always the case.  There are a few scenarios in which the benefits you receive will be lower than the benefits...

We're nearing the end of the year, and while there's not a whole lot left that you can do to perhaps improve your tax situation for this year, there actually is one more thing you may be able to accomplish before 2025. It's called a QCD - or Qualified Charitable Distribution. If you're at least 70 1/2 years old, and you're charitably inclined, this technique may allow you...

Today we're asking the question that we posed to our listeners at the beginning of 2024: Is this a good time to do your Roth conversions? There are reasons for doing them at the end of the year, just as there are also sound reasons for waiting until the new year begins.  What it all comes down to is whether or not you know your tax situation for the year - which, with just a few weeks left, i...

Building a nest egg is relatively easy if you're both consistent and patient. Regular contributions over time can lead to compounded growth, which may give you the amount of money you need to live on. But while building a savings can be easy, keeping it from running out is a whole other challenge.  How you take withdrawals from your savings once you're retired is crucial to the survival...

Regular listeners to this podcast know that we talk a lot about a Bucket Strategy, and why we so firmly believe in it.  But it's important to note that we're not just referring to any bucket strategy - rather we like to refer to it as THE Bucket Strategy®. To us, it's not as simple as dividing up assets into three segments and then calling it a day.  There are individual circumstanc...

There's a well-known topic in the investing world known as Asset Allocation which is primarily about deciding which asset categories you should own – stocks, bonds, CDs, alternative investments, etc. It's an important part of building your portfolio.  But there's another, equally important part that doesn't get talked about nearly enough: Asset Location. This has to do with how...

Most people, by the time they reach retirement age, have a certain amount of money saved up that they'll need to tap into from time to time.  Problem: that money may need to last a lifetime, and because you don't know how long you'll live, you have no idea how much is "too much" to take out. You' re going to require a certain amount of money to meet your basic expense...