Financial Planning Opportunities

Market downturns present financial planning opportunities. Below are several opportunities that Roundview has identified. Please contact us to see how we can assist you in executing on these strategies. 

Tax-loss Harvesting 

Taxable accounts may have equity holdings with unrealized losses. Selling these positions and purchasing similar companies allows us to realize losses while maintaining your target market exposure. These losses can be carried forward indefinitely and used against capital gains in the future. The portfolio managers at Roundview Capital have been working hard to identify the best tax–loss harvesting strategies for each client. 

Rebalancing  

Studies of past market downturns show that the best thing to do in a bear market is to rebalance into it. In other words, if stock prices continue to fall and the percentage of your portfolio invested in stocks declines as a result, we should be buying stocks to bring your portfolio back to the target allocation. While this strategy may be difficult to stomach in volatile markets, history has shown the effectiveness of disciplined rebalancing.  

Debt Refinancing  

With interest rates currently near all-time lows, individuals can take advantage of rock-bottom rates by refinancing their current debt. This applies not only to mortgages, but also student loans, and any other high rate debt. 

Roth IRA Conversions 

Market downturns may impact Traditional IRA balances. This presents an opportunity to convert your Traditional IRA into a Roth IRA while minimizing the tax impact of the conversion. This is favorable for individuals that believe their current income tax rate will be lower now than in the future.  

Estate Planning – Gifting 

Lower company valuations present an opportune time to gift shares of existing equity holdings to heirs. Reduced prices allow donors to gift more shares of their current holdings while using less of their federal lifetime gift tax exception of $11,580,000.