Kitces.com - Advancing Knowledge in Financial Planning

Using Average Cost Accounting for Exchange-Traded Funds?

September 5, 2008 08:33 pm 2 Comments CATEGORY: Taxes

The average cost accounting method was first created to allow a taxpayer to simply report the gain on partial sales based on the average cost of all shares purchased (instead of the default FIFO treatment, or by using specific share identification), but was reserved exclusively for mutual funds and not for individual equity securities.

However, it appears now that the rules may be a little broader than anyone realized - because technically, an exchange-traded fund (ETF) may also be eligible, notwithstanding the fact that it trades more like a stock than a mutual fund.

The Plight Of The Independent RIA

August 27, 2008 02:15 pm 1 Comment CATEGORY: Planning Profession

A new campaign is underway to help promote the visibility of independent RIAs to the general public. But the focus is not to increase awareness of the differences between RIA and broker/dealer compensation, nor to explore the fiduciary versus suitability debate. Instead, it's simply to convey the message "We exist."

Is the Military Leading the Cutting Edge of Financial Planning?

August 19, 2008 09:42 pm 3 Comments CATEGORY: Planning Profession

In the midst of the financial planning community's struggles to figure out how to serve the mass middle market in an effective manner, a surprising new entrant to the field may lead the way in showing how to get it done right. Welcome to the Personal Financial Counselor Network, brought to the U.S. military courtesy of the Department of Defense!
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Negative buzz about Vanguard's IRA beneficiary rules

August 18, 2008 02:42 pm 3 Comments CATEGORY: Estate Planning

Do your clients have retirement accounts held directly with Vanguard? More than one? Do you know who the beneficiaries are for each account? Are you SURE you have that right? Sorry, think again.

Things are Heating Up with the Next Generation… of No-Load Life Insurance!

June 26, 2008 07:50 pm 12 Comments CATEGORY: Insurance

For many years, the no-load space for life insurance products has been very limited, to a large extent because fee-based advisors were perceived as being a very weak target market by the traditional insurance companies.

However, a new entrant to this marketplace is raising the stakes on the pricing and transparency of permanent life insurance, and is starting to get some attention as a result!

Single-State Municipal Bond Funds Dodge a Bullet! But What About 529 Plans?

May 19, 2008 10:25 pm 2 Comments CATEGORY: Taxes

Earlier today the Supreme Court issued its ruling in the case of Department of Revenue of Kentucky v. Davis, stating that Kentucky's tax rules which exempt the interest earned on Kentucky muncipal bonds while taxing the interest of other state's bonds is not a violation of the so-called dormant commerce clause of the Constitution. The ruling spared what may have been a tumultuous disruption to the municipal bond market, but the Supreme Court's decision still leaves the door open for several issues...