What Does it Mean? Simple Definitions of Common Financial Terms
There’s a lot of lingo in financial services, just as there can be in many other technical industries.
Here are simple explanations of a few terms that people find confusing:
Roth IRA Conversions
Many people confuse a Roth IRA conversion with a Roth IRA contribution. The two are very different.
The conversion happens when you take all that pre-tax money you’ve been contributing to your retirement account and move it into a Roth IRA. You’ll pay income taxes immediately on the money you transfer but it can grow tax-free from that point forward. You can convert as little or as much money as you’d like. There’s no cap…for now, at least. There’s talk on Capitol Hill about eliminating or capping conversions so it may be smart to act now while the opportunity still exists.
We’re happy to help you determine if a conversion is in your best interest. Just contact us and we’ll set up an appointment.
Fiduciary
Have you heard this word used to describe a financial advisor but didn’t know what it meant? A fiduciary is a professional who is obligated to make decisions that are in the best interest of their client regardless of how much the fiduciary is being compensated. To be clear, an advisor doesn’t haven’t be a fiduciary to do a good job for you, but it’s important to know whether they are one. Everyone in our office who meets with clients is a fiduciary.
In the world of financial services, ignorance is not bliss. We want all Johnson Brunetti clients to know what they’re investing in and why. So, please ask us for definitions and explanations of terms or concepts you don’t understand. We’re happy to help.
Information presented in our podcasts is considered current as of the created date. Over time, some information presented may become stale. We recommend you consult with your Financial Professional before making any changes based on information contained here.
Johnson Brunetti is a marketing name for the businesses of JB Capital and JN Financial.
Investment Advisory Services offered through JB Capital, LLC. Insurance Products offered through JN Financial, LLC.
The guarantees provided by any type of insurance contract are based on the claims-paying ability of the insurance company.
Related Resources
-
The Right Order to Build Your Financial House
You wouldn’t design a house that leaves you exposed to outside elements, so why do the same when building your financial house? A well-constructed house first and foremost needs a strong foundatio… -
Identity Theft: What to Do If Your Identity Is Stolen
In the digital age, the threat of identity theft is at an all-time high. Sophisticated cybercrime tactics and schemes have left us more vulnerable to online scams than ever before. So, what can… -
The Road to Retirement – Don’t Go it Alone
Achieving the retirement you’ve always dreamed of often requires careful planning. While the do-it-yourself approach may be difficult to shake, consider the benefits of seeking professional advice… -
Am I Carrying Too Much Debt in Retirement?
At any stage in life, debt can interfere with your financial goals. But what about when you retire? How much debt is too much? It depends on a variety of factors, including your income relative to… -
What Updates Can We Expect for Social Security in 2025?
A new year means new rules for retirement plans. Let’s start with one of the largest sources of income for millions of retirees: Social Security. What changes can we expect in 2025? Heath Gross… -
Getting It All Together for Retirement
After a long, fulfilling career, the time has come to embrace the next chapter. You may have envisioned the age at which you’d retire since you began working, but it’s important to distinguish bet… -
Key Questions for Planning Your Retirement Income
Replacing your income in retirement is a significant undertaking that raises many important questions and requires careful planning. First and foremost, it’s essential to have a retirement income … -
Health Care Expenses in Retirement
Of all the expenses to expect in retirement, health care often makes up a significant portion of your costs. Monthly premiums, out-of-pocket expenses, and services not covered by Medicare can quic… -
Income Planning 101
You’ve spent the last few decades saving for retirement but are you truly prepared? To help address any concerns or uncertainties you may have, you need an income plan – one that considers every f… -
Maximizing Your Social Security Income
Social Security can serve as a safety net for many retirees, sometimes acting as a primary source of income. However, the program is highly complex with over 500 ways to claim benefits. Even one o…
