Target-date funds offer a hands-off approach to retirement investing by automatically adjusting asset allocations over time. These funds balance growth and security by shifting from stock-heavy portfolios in early years to safer investments like bonds as retirement nears.
Named for the investor’s target retirement year, these funds simplify decision-making and are commonly found in employer-sponsored 401(k) plans. A key factor in choosing one is its “glide path,” which determines whether asset adjustments stop at retirement or continue for years beyond.
While convenient, investors should compare expense ratios and investment strategies to ensure alignment with their risk tolerance. Three TDF funds to consider are:
- Vanguard Target Retirement 2045 Fund Investor Shares (VTIVX) – Expense Ratio: 0.08%
- Fidelity Freedom Index 2045 Fund Investor Class (FIOFX) – Expense Ratio: 0.12%
- T. Rowe Price Retirement 2045 Fund (TRRKX) – Expense Ratio: 0.62%
Finsum: Despite their “set it and forget it” appeal, periodic reviews help maintain a well-balanced portfolio.
Deeper tax planning integration in wealth management can enhance advisors’ ability to deliver proactive tax strategies that go beyond traditional investment management. Tax planning has become a crucial differentiator in modern wealth management, with more investors seeking advisors who can optimize after-tax returns and long-term financial outcomes.
Strategies like Roth conversions, tax-loss harvesting, and asset location are now essential tools for high-net-worth clients navigating an increasingly complex tax landscape. With concerns about rising tax rates and policy risks, forward-looking tax planning is becoming indispensable for preserving and growing client wealth.
Advisors who incorporate these strategies can build deeper client relationships, attract more assets, and position themselves competitively in an evolving industry.
Finsum: Tax strategies help give advisors an edge when dealing with clients and helping them allocate to efficient portfolios.
JP Morgan Asset Management is gearing up to introduce its first private credit interval fund, aiming to expand its footprint in private credit. This newly registered credit markets fund, filed with the SEC, will be accessible to wealth market investors.
The fund plans to maintain a diversified portfolio that includes loans, bonds, structured finance securities, and other credit-related investments. Interval funds, like this one, provide access to private market assets with periodic liquidity windows, balancing stability with limited redemption opportunities.
To manage liquidity, a portion of assets will be allocated to short-term debt instruments, money market funds, and cash reserves.
FINSUM: As investor demand for private credit grows, asset managers are increasingly tailoring products to individual investors seeking diversification.
Cryptocurrencies tumbled as concerns over a broader U.S. stock selloff overshadowed recent efforts by President Trump to support the industry. Bitcoin dropped more than 3% in early Asian trading, while Ether sank as much as 6% to its lowest level since October 2023 before recovering some losses.
The decline followed a sharp selloff in technology stocks, with the Nasdaq 100 plunging 3.8%, its worst session since October 2022. Despite Trump’s executive order to establish a U.S. Bitcoin reserve, investor sentiment remained fragile as macroeconomic risks took center stage.
Analysts noted that leveraged crypto-related ETFs were among the hardest hit, with some plunging more than 30% in a single day. While Bitcoin hovered around $79,300, traders were eyeing key support levels at $73,000 and $70,000, where stronger buying interest could emerge.
Finsum: While many think of crypto as hedge against market volatility, we need to remember that those hedges are a little effective on the currency side.
- Flame-cooked flavors are making a strong return as diners seek the rich, smoky depth that only open-fire cooking can provide. From Texas barbecue joints to London’s Brat and Kyoto’s La Bûche, chefs around the world are reviving traditional wood-fired techniques, creating dishes that capture the essence of rustic, high-heat cooking.
- Southeast Asian cuisine is also evolving, driven by chefs who have honed their craft abroad and are now returning home to reimagine their culinary heritage. Fine-dining establishments across Malaysia, Vietnam, and Singapore are blending time-honored recipes with innovative techniques and global flavors.
- China’s food scene is undergoing a renaissance, gaining long-overdue recognition on the global stage. In Beijing, chefs are reviving imperial-era recipes once reserved for emperors, offering a taste of history with meticulously recreated royal dishes. Meanwhile, Shanghai’s Hakkasan and Obscura are infusing classic Chinese flavors with contemporary influences, merging tradition with innovation.
Finsum: We have our eye out on these culinary trends and look forward to how a traditions are honored but innovation is evolving.
The municipal bond market experienced fluctuations in 2024, with tax-free yields rising in response to Treasury yield movements, particularly in the latter half of the year. Market uncertainty increased following the Federal Reserve’s December rate cut, which coincided with ongoing inflation concerns and economic crosscurrents.
As 2025 begins, the potential extension of 2017 tax cuts under the new administration may impact demand for tax-free bonds, particularly if corporate tax rates are lowered. Climate-related risks, such as the LA fires and hurricanes, have drawn attention to municipal finance, with increased insurance costs and resilience measures potentially leading to more bond issuance.
Despite these pressures, municipal credit quality remains stable, supported by strong reserves, prudent budget management, and infrastructure reinvestment. However, challenges persist in certain sectors, including healthcare, higher education, and public K-12 schools, due to shifting demographics, rising costs, and expiring pandemic aid.
Finsum: These are important things to monitor for municipal bonds, and the increasing role of DOGE, could drastically change this bond segment.
ETF issuers are continually innovating to meet the demand for buffer strategies, appealing to financial advisors and clients who prioritize downside protection, even if it limits potential gains. Often dubbed "boomer candy" for their popularity among retirees, buffered ETFs offer a sense of security akin to a safety net for nervous investors.
The market for these ETFs has grown exponentially, with over 200 options managing nearly $46 billion in assets, a significant leap from just $200 million in 2018. These strategies typically shield against initial market declines, like the first 10%, while capping upside returns and are often tied to indices like the S&P 500.
Variations now include funds offering complete downside protection or innovative approaches like Calamos Investments’ product, which protects bitcoin’s price, but caps gain at 10%.
Finsum: Investors looking for stability particularly as they are aging could benefit from these strategies.
Municipal bonds, often overlooked, are gaining attention as fixed income performs strongly, prompting investors to reconsider their portfolios for 2025. Gregory Steier from Brown Brothers Harriman, highlighted that with elevated yields and record municipal issuance, risks are relatively low, making this an exciting time for munis.
Steier emphasized that, for 2025, high-quality municipal portfolios might even outperform equities. Munis are attractive for their liquidity, income, diversification, and tax efficiency, with national muni bonds offering advantages over state-specific ones.
Investors can access municipal exposure through ETFs like the ALPS Intermediate Municipal Bond ETF (MNBD), which focuses on bonds exempt from federal taxes, offering an active approach and strong returns, outperforming its benchmark.
Finsum: This strategy could be a compelling option for those seeking solid yields to kick off the new year.
Direct indexing allows investors to own individual stocks in a customized portfolio, offering tailored market exposure, tax-loss harvesting, and alignment with personal goals. Unlike ETFs, which can only tax-loss harvest during broad market declines, direct indexing captures tax benefits throughout the year.
Advisors increasingly use it as a core strategy for U.S. equity exposure, leveraging its tax advantages to offset gains from other parts of a client’s portfolio. Technology enables the efficient management of thousands of unique accounts, optimizing trades daily for greater customization and tax efficiency.
It is also a powerful tool for diversifying concentrated stock positions or preparing for future liquidity events by accumulating tax-loss reserves.
Finsum: When choosing a provider, factors such as investment performance, tax alpha, and client service are critical to the goals of direct indexing.
Strive Asset Management has launched direct indexing services on Fidelity and Schwab platforms, reaching a broad retail audience. These services emphasize daily tax-loss harvesting and pro-shareholder governance, avoiding ESG or DEI constraints.
Powered by Vestmark’s VAST technology, the initiative aligns with Strive’s anti-ESG philosophy, aiming to deliver superior financial outcomes for clients. CEO Matt Cole highlighted the unique value of Strive’s approach, citing frequent drawdowns in large-cap equities that offer tax-harvesting opportunities.
Founded in 2022 by Vivek Ramaswamy, now a key figure in President-elect Trump’s administration, Strive manages $1.7 billion in assets. Its ETFs focus purely on financial returns, contrasting with ESG-oriented funds by voting against ESG shareholder proposals.
Finsum: ESG and DEI oriented funds will have an uphill battle against the trump administration.
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Municipal bonds have taken a significant hit after Donald Trump’s election as president, following a sharp selloff in U.S. Treasuries amid concerns over potential deficit-expanding policies and inflationary effects.
Benchmark municipal yields spiked, echoing the Treasury market’s movements as investors reacted to the likelihood of Trump’s economic plans impacting inflation. Many state and local governments had already rushed to issue bonds before the election, leading to high issuance in October, but new sales were sparse this week.
Despite the volatility, analysts like Lyle Fitterer of Baird predict bond issuance will recover in time, driven by the U.S.'s substantial infrastructure needs. A Republican victory also stirs concerns that tax cuts could reduce demand for tax-exempt municipal bonds, with JPMorgan analysts highlighting the risk to the tax-exemption status itself.
Finsum: It’s also worth noting how inflation is going to potentially affect these assets, because there is strong chance inflation will increase under the new regime.
Commonwealth Financial Network is enhancing its advisor platform with new tax-focused tools to improve efficiency and meet clients' evolving needs. This suite includes advanced planning solutions such as direct indexing, portfolio tax optimization, and unified managed accounts, providing advisors with tailored options for optimizing client portfolios.
In 2025, advisors will also have access to a managed CTO service to streamline technology management, allowing them to focus more on client relations. Additionally, tools like the tax transition feature and automated tax-loss harvesting will support tax-efficient investing for clients.
These upgrades are positioned to enable advisors to scale their businesses and better serve clients, particularly those with sophisticated financial needs.
Finsum: These types of innovations in wealth tech can vastly improve advisors options particularly with tax solutions.
Vanguard's ETFs offer excellent options for investors seeking both passive income and diversification. The Vanguard Value ETF, one of the largest value-oriented funds, holds mainly large-cap stocks with solid dividend payouts, keeping its top 10 holdings at around 21% of the portfolio.
For a more concentrated approach, the Vanguard Mega Cap Value ETF focuses on mega-cap companies, leaning toward value-heavy sectors like healthcare and energy, which tend to fare well in economic downturns. Investors aiming for higher yield might consider the Vanguard High Dividend Yield ETF, which offers broad exposure to 537 holdings and a nearly 3% yield without overemphasizing any single sector.
Although these funds have lagged the tech-driven S&P 500 recently, they have shown significant long-term growth, nearly tripling in value over the last decade.
Finsum: These ETFs suit different needs, whether one prefers a focus on industry giants or broader diversification for consistent passive income.
Switching to a new broker-dealer is often a complicated process, but finding the right partner can significantly improve your business and client service. Legal guidance is essential to avoid potential pitfalls, such as contractual issues or ownership disputes over client relationships.
Developing a comprehensive transition plan will help organize client accounts and ensure the process runs smoothly. Engaging your team early allows for shared responsibility and clear goals throughout the transition.
It’s also a good time to reassess your client base, streamlining relationships and services to align with your current practice. Finally, preparing client data properly and crafting a clear communication plan can help ensure a smooth and positive transition for everyone involved.
Finsum: Data, in particular, can be critical with the advances in information and technology.