March Newsletter: Last Minute Tax Moves, Stock Market Jitters, ‘Increase’ Your Spending, and More!

Welcome to the latest edition of the Healy Wealth Management newsletter, your monthly guide to navigating the financial complexities of life.

Let us know your thoughts. And if there’s something that could benefit a friend or family member, please send it their way.

It's Not Too Late to Reduce your 2024 Taxes! [As of Posting]

Click below to watch Kyle Grandstaff discuss three potential last minute tax saving strategies for 2024. You have until April 15. We can help.

Riddle of the Month

How can you tell the difference between an alligator and a crocodile?

Spend Less by Spending More

It may seem counterintuitive, but spending more upfront on high-quality items can actually save you money in the long run. A well-made pair of shoes, a durable appliance, or quality furniture lasts years longer than cheaper alternatives, reducing replacement costs.

The same principle applies to gift-giving. Instead of scrambling for expensive last-minute presents, buy gifts year-round as you find great items on sale. Keep an inventory of “that would be perfect for someone” gifts, and you’ll avoid both holiday stress and overspending.

Thoughtful, strategic spending leads to better value, less waste, and long-term savings.

The ABCs of IRAs

Saving for retirement can feel overwhelming, but one of the best tools available to help you build long-term wealth is an Individual Retirement Account (IRA). Whether you’re new to investing or looking to optimize your retirement strategy, understanding the ABCs of IRAs can help you make informed decisions.

A – Account Types: Traditional vs. Roth IRA

The first step in mastering IRAs is knowing your options. There are two main types:

Traditional IRA – Contributions may be tax-deductible, and your investments grow tax-deferred. You’ll pay taxes when you withdraw funds in retirement. This is a great option if you expect to be in a lower tax bracket when you retire.

Roth IRA – Contributions are made with after-tax dollars, but withdrawals in retirement (including earnings) are tax-free if certain conditions are met. A Roth IRA is ideal if you expect to be in a higher tax bracket in retirement or want to avoid required minimum distributions (RMDs).

Choosing between the two depends on your income, tax situation, and long-term goals.

B – Benefits of an IRA

IRAs offer several advantages that can help grow your retirement savings:

Tax Benefits – Whether you choose a Traditional or Roth IRA, both offer tax advantages that can maximize your investment growth.

Compound Growth – The earlier you start, the more time your money has to grow tax-deferred or tax-free.
Investment Flexibility – Unlike employer-sponsored plans like a 401(k), IRAs typically offer a wider range of investment choices, including stocks, bonds, mutual funds, and ETFs.
Retirement Security – Having an IRA in addition to a 401(k) or pension can help ensure you have enough saved for a comfortable retirement.

C – Contribution Limits and Catch-Up Rules

To get the most out of your IRA, it’s essential to understand contribution limits and rules:

For 2025, the annual contribution limit is $7,000 ($8,000 if you’re 50 or older).

- Income Limits for Roth IRAs – Roth IRA eligibility is based on your income. For example, in 2025:

- - Single filers: Contributions start to phase out at $150,000 and are completely phased out at $165,000.

- - Married couples filing jointly: Contributions start to phase out at $236,000 and are completely phased out at $246,000.

Income Limits for Deducting Traditional IRA Contributions – Anyone can contribute to a Traditional IRA, but the ability to deduct contributions depends on income and whether you (or your spouse) have a workplace retirement plan:

- If you’re covered by a workplace plan like a 401(k):

- - Single filers: Deduction phases out between $79,000 and $89,000.

- - Married filing jointly: Deduction phases out between $126,000 and $146,000.

- If your spouse is covered by a workplace plan (but you are not):

- - Deduction phases out between $236,000 and $246,000 (married filing jointly).

- If neither you nor your spouse is covered by a workplace plan:

- - You can deduct your full Traditional IRA contribution, regardless of income.

Catch-Up Contributions – Available for Both Roth and Traditional IRAs

If you’re 50 or older, you can contribute an extra $1,000 per year as a catch-up contribution, increasing your total limit to $8,000.

This applies to both Roth and Traditional IRAs, allowing older investors to accelerate their retirement savings!

“The hardest thing in the world to understand is the income tax.“

– Albert Einstein

Answer: Alligators are seen later. Crocodiles are seen in a while.

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