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What story do you want to tell about your next vacation? What could make your next trip amazing? How do vacation goals and financial planning intersect? The answers could lie in this year’s travel trends. In 2022, people planned getaways that weren’t so much focused on where they went, but rather on what they experienced.
2022 Travel Trends
- Friendcations: After missed milestones and months (or years) of Zooming since 2020, friends are reuniting for the first time in a while and they’re traveling in bigger groups to do it. That’s one reason why bookings for party spots that are great for big groups – like Vegas, the Caribbean, and Ibiza – exploded in 2022, according to a CNBC report.
- Pet Travel: Forbes recently reported more people are taking their pets with them on leisure and business travel. And more hotels and airlines are becoming pet-friendly, finding ways not only to accommodate pets but to also treat them as guests. One unique aspect to this trend is how some folks are integrating into other trends – like taking workcations or bringing pets on extreme adventures.
- Extreme Adventures: Many folks, after feeling cooped up and bored, were ready to adopt a thrilling new adventure or physical challenge as their dream vacations. Safaris, deep sea dives, and extreme hiking were among the favorites, according to Conde Nast Traveler. Some even signed up for sophisticated “space camps” for a truly out-of-this-world vacation experience.
Travel trends come and go, but the benefits of getting away can last a lifetime.
It’s a chance to unplug, destress, recharge, and create memories. Vacations have even been shown to provide physical health benefits, too, like lower blood pressure and lower risks of heart disease, according to . Simply put, vacations are good for us. They are an important piece of the financial planning process and of creating a truly rich life.
Are you ready to get away? Your advisor can help you achieve your vacation goals. That’s the value of #lifewithPerspective.
Here’s a quick year end tax tip or two.
If you’re the parent of a college student, you may be able to lower your 2022 tax bill by prepaying some 2023 tuition. The American Opportunity Tax Credit is worth up to $2,500 for each student in their first four years of undergraduate study. This is a tax credit, not a deduction, so you don’t need to itemize to take advantage of the opportunity.
The Lifetime Learning Credit is another way to reduce your tax bill if you plan on taking classes yourself in 2023. By prepaying the January bill before the end of 2022, you can claim up to 20 percent of your costs for tuition, fees, and books, up to $2,000. This credit is not limited to undergraduate expenses, nor to full-time students.
For both credits, married couples filing jointly with modified adjusted joint income (MAGI) of up to $160,000 can claim the full amount. Those with a MAGI of up to $180,000 can claim a partial amount.
Want another year end tax tip? Read our article about tax loss harvesting.
Photo courtesy of Andrea Piacquadio via Pexels.com
The boat you stand in rocks and sways as the waves roll and churn and crash across the stern. That’s how it can feel when tax rules are up in the air, soon to change, or recently changed. If you’re a high earner or have a sizable portfolio, this unsteady feeling intensifies. Wouldn’t it be great to have smooth sailing tax strategies?
Many people make the mistake of leaving things “as is” when laws change, leaving potential tax savings on the table. They don’t realize that there often are small adjustments they can make before new rules take effect to lock in savings.
What if you viewed changes to tax law as an opportunity? The wealthiest Americans tend to embrace tax changes and find hidden savings as the tax tides ebb and flow. They ask questions.
- How much of my income and which of my investments will be affected?
- How can I use the current unpredictability around taxes to my benefit?
- Are my investments still aligned with my tax strategies?
- Is there a way to lock in savings now before rules change?
At Perspective, we ask and answer those questions for you. We recommend and help you implement solutions that best fit your unique situation. We do all this because being proactive can steady your tax strategy and provide greater peace-of-mind.
Smooth Sailing Tax Strategies
What is in the Inflation Reduction Act? A staggering brew of green energy spending and corporate taxes, as well as major changes to Medicare. Will new Medicare laws help retirees? And will the new laws help the economy? Maybe. Or maybe not. When it comes to massive legislation, the future is always a bit hazy.
The timeline below details some of the major Medicare law changes that are planned. Since health care is one of the biggest unknown costs in retirement, lowering drug costs and making spending more predictable for Medicare recipients could absolutely have a positive impact on millions of people. The new rules also could mean premium changes as insurance companies figure out their models.
Whether the overall bill will live up to its name, lower inflation, and have a net positive impact on the economy also remains to be seen. Some economists project the bill will end up modestly reducing inflation and trimming the federal budget over the next decade. Others are concerned about the impact of the new corporate tax rules written into the legislation.
Legal challenges or post-election changes could end up altering much of what’s in the new legislation. Much depends on the actual execution of the new rules. As is usually the case, only time will tell.
Maximize Efficiency and Increase Income: Reducing your costs means more than spending less money. And financial planning means more than just saving and investing. It’s about maximizing efficiency and increasing income, so you can enjoy life.