Latest news with #BernsteinPrivateWealthManagement
Yahoo
13-05-2025
- Business
- Yahoo
Bernstein Private Wealth Management names new Wealth Strategies head
Bernstein Private Wealth Management (Bernstein) has appointed Ashley Velategui as the head of its Wealth Strategies Group, succeeding Tara Popernik. Velategui, who took on the new role on 9 May, has been tasked with heading a team dedicated to advising high net worth and ultrahigh net worth clients on comprehensive financial planning, philanthropy, and investment strategies. Operating out of Seattle, Washington, Velategui will report to Bernstein Investments and Wealth Strategies head Alex Chaloff. Meanwhile, Popernik is departing from the company to 'pursue another opportunity,' Bernstein said in a statement. Chaloff said: 'Ashley is the natural choice for this important role at our firm. Her extensive experience and dedication have been instrumental in driving the rapid growth of our West Coast markets. 'Ashley is a strong leader, trusted by both clients and advisors, and an essential member of the advisory team managing complex relationships. Her appointment will enable us to further accelerate our wealth strategy business and help our clients to achieve their wealth goals partnering with our wealth advisors nationwide." With an 18-year tenure at Bernstein, Velategui has extensive experience in estate and tax planning. Velategui joined the Wealth Strategies Group in 2011 and has most recently held the position of Planning Research national director since 2023. She was instrumental in enhancing Bernstein's planning tool, Wealth Forecasting System, the statement added. Besides, she managed the recruitment, training, and development of the firm's Wealth Strategies analyst team. Commenting on the new role, Velategui said: 'I am excited about taking on this leadership role at Bernstein. The calibre of intellect across our Wealth Strategies team and Bernstein is unparalleled. 'I look forward to continuing to help grow our platform and working with our wealth advisors to help clients navigate the complexities that come with having significant wealth.' Based in Nashville, Bernstein Private Wealth Management operates as a business unit of investment manager AllianceBernstein. With a presence across 26 countries and jurisdictions, AllianceBernstein has over $785bn in assets under management. "Bernstein Private Wealth Management names new Wealth Strategies head" was originally created and published by Private Banker International, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
15-04-2025
- Business
- Yahoo
1 Wall Street Analyst Says There's a Great Investment Hiding in Plain Sight. These 2 Dividend Stocks Are My Best Ideas for Investing in It.
The market is in a state of flux thanks to geopolitical issues around tariffs. There is a huge amount of uncertainty. If you have money to invest today, it is hard to decide what to do, since sticking cash under your mattress may feel like a good call in the midst of a dramatic market decline. One Wall Street pro has a different tactic. Buy shares in businesses that provide a life necessity: shelter. Here are two high-yield ways to do just that. Maura Pape, a senior investment strategist at Bernstein Private Wealth Management, recently highlighted commercial real estate as a good investment opportunity to Bloomberg. Commercial real estate is actually a pretty big category, and small investors would have a hard time investing directly in the space, anyway. But Pape did, in fact, narrow things down, singling out multifamily as a particular opportunity. "Multifamily" sounds fancy, but it just means apartment buildings. The truth is, you could probably find a small apartment building in your own neighborhood to buy. But that might pose financial and practical challenges and wouldn't afford you diversification or scale. This is why you might be better off with an apartment-focused real estate investment trust (REIT). There are two big stories here. First, shelter is a life necessity. It doesn't matter if the market is falling or if the economy has fallen into a recession. People still need a place to live, and that makes apartment REITs a fairly resilient property type. Second, there has been a drop in multifamily construction projects in recent years that should help support rental rates, and thus growth, for apartment landlords. Two well-run apartment REITs you might want to look at are AvalonBay Communities (NYSE: AVB) and UDR (NYSE: UDR). Here's why. AvalonBay isn't the largest apartment landlord, but it is one of the best run. It has a material focus on coastal markets, where supply has been historically constrained. It also has a long history of active portfolio management as well, buying, selling, and building assets, depending on which one leads to the best returns. AvalonBay's portfolio activity is centered around ensuring that it has young and attractive apartments to offer consumers who live in regions where rents are high and/or growing rapidly. It is currently working to expand its presence in the Sunbelt region, where population growth has been strong in recent years. UDR is another large apartment landlord. It has long focused on having a diversified portfolio. It currently has exposure to both coastal markets and the Sunbelt, where it has operated for many years. However, there's another layer of diversification here, because UDR owns both A- and B-quality assets. In hard times, B-grade apartments can be attractive to tenants because they generally have lower rents. AvalonBay's dividend hasn't been increased every year, but it has generally trended higher over time. UDR's dividend has been increased annually for 16 consecutive years. Right now, AvalonBay's dividend yield is 3.6%, and UDR's is 4.2%. Both are well above the yield you'd collect from the S&P 500 today. And with multifamily construction starts down, both UDR and AvalonBay are likely to enter a stretch where they benefit from an increased ability to push through rental increases. Thus, their dividends are likely in a very strong position to be maintained or increased. When the market is in a state of flux, with the words "correction" and "bear market" making the rounds, investors often buy consumer staples stocks. The reason is that consumer staples are necessities. That same logic applies to apartment REITs like AvalonBay and UDR -- only these two REITs come with some added benefits, including high yields and a positive business backdrop for their unique property focus. Before you buy stock in UDR, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and UDR wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $502,231!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $678,552!* Now, it's worth noting Stock Advisor's total average return is 800% — a market-crushing outperformance compared to 156% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of April 14, 2025 Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool recommends AvalonBay Communities. The Motley Fool has a disclosure policy. 1 Wall Street Analyst Says There's a Great Investment Hiding in Plain Sight. These 2 Dividend Stocks Are My Best Ideas for Investing in It. was originally published by The Motley Fool Sign in to access your portfolio
Yahoo
06-04-2025
- Business
- Yahoo
Wondering if you should convert your tax-deferred retirement savings to a Roth? Here's what to consider
Having financial flexibility in retirement — especially in being able to maximize your spending while minimizing your taxes — is an optimal situation. And it's one you can arrange by keeping at least some of your retirement savings in a tax-free account. 'You're giving yourself more options in the future,' said Brian Kearns, an Illinois-based certified public accountant and certified financial planner. One way to do that is to convert at least some of your tax-deferred savings in your 401(k) or traditional IRA into a Roth account. Money rolled into Roth 401(k)s and Roth IRAs grow tax free and may be withdrawn tax-free so long as you leave it in the account for at least five years after the rollover. Unlike creating a Roth IRA and making new contributions to it every year, there is no income limit on who may convert their savings into a Roth (or who may contribute to a Roth 401(k) on an ongoing basis, either). Another advantage: In retirement, you get to decide how much and when you make withdrawals from your Roth savings, whereas with tax-deferred savings in traditional IRAs or 401(k)s, you must start taking required minimum distributions at age 73. That said, Roth conversions aren't the right answer for everyone. Here is a look at what to consider before making a move. The vast majority of 401(k) plans (93%) let participants create a Roth 401(k) account within the plan; and 60% of those allow for so-called 'in-plan Roth conversions,' according to the Plan Sponsor Council of America. An in-plan conversion means you can choose to convert some or all of your accumulated tax-deferred savings into after-tax Roth savings. The catch: You will have to pay the income tax owed on any money you convert the year you make the conversion. That's why for a lot of people the decision of how much to convert at any one time comes down to whether they have money available to pay that tax bill, said Tara Popernik, the head of wealth strategies at Bernstein Private Wealth Management. Say you convert $100,000 this year. That amount is added to your gross income and may end up pushing you into a higher tax bracket. So, say you're normally in the 22% federal bracket, it could push you into the 24% bracket. And that means on top of the taxes you owe on your annual income, you might owe an additional $24,000 (24% x $100,000) plus any applicable state income tax. If ever there was a time to consult a CPA, or a certified financial planner with tax experience who has helped many clients weigh Roth options, this is it. (They also can help you assess whether a conversion will make sense should lawmakers later this year choose to extend some or all of the expiring 2017 tax provisions.) But, generally speaking, here are some questions to consider when deciding whether a conversion would be a good move: 1. Do you expect your income to grow between now and retirement? If you're in the first half of your career, chances are your earnings will grow between now and when you call it quits. And that means you're likely to move into a higher tax bracket in the coming years. So it might be more advantageous to do a conversion sooner rather than later because your tax bill will be lower and your tax-free savings will have longer to grow. 2. Can you afford the immediate tax bill? Ideally, you should have enough cash on hand to pay that one-time tax bill — cash you will not need for current living expenses, upcoming debt payments or emergencies. If you have to raise the cash, Popernik said, try to avoid selling anything that would incur a capital gains tax, because that would reduce the advantage of converting. So, too, in most instances, would tapping your tax-deferred retirement savings just to pay the conversion bill — especially if you're under 59-1/2, since you will be subject to a 10% early withdrawal penalty on top of the income taxes you'd owe. Again, lean on your tax adviser to help you figure out which, if any, cash-raising strategy makes sense. If it turns out paying the tax bill on a lump-sum conversion would be too burdensome, and you have the option of contributing to a Roth 401(k), you can start making taxable contributions to it on a go-forward basis. Or, if your income is low enough, you can start your own Roth IRA. 3. Will your taxes go up in retirement? Trick question. The only truly correct answer is 'Who knows?' But, based on the tax system we have today, you can roughly gauge where things might go if the world — and the US tax code — don't do a complete 180. Generally speaking, if you anticipate your income taxes will be higher in retirement than now, converting tax-deferred savings to a Roth is likely advantageous. And by making a conversion sooner, you're likely to get the most value from it. 'The longer the money stays invested in the Roth, the bigger the benefit,' Popernik said. 4. When is the best time to convert, markets-wise? A recent analysis from Bernstein Private Wealth Management suggests the ideal time to convert your tax-deferred money to a Roth would be when markets are down. If you do, you'll get the most bang for your tax buck. By investing in assets through a Roth when they are at their lows, 'the subsequent gains when the recovery takes hold can be sheltered in a tax-free environment,' the report noted. That said, it's impossible to time market lows and highs. And the Bernstein analysis found that even converting when asset prices are at a peak may still confer long-term tax-free gains that might make a conversion worth it. 5. What income sources will you draw on when you retire? One way to guesstimate your tax obligations in retirement vs. now is to consider a) how much income you'll need to live on; and b) what your income sources will be, keeping in mind that not all sources of income are taxed alike. So, for instance: Will you have income from a pension on top of your Social Security benefits? Will you receive rental income from a property? Will you be drawing on taxable income like interest and dividends? Or on tax-free interest from municipal bonds? Having both taxable and tax-free savings to draw on can help you optimize your withdrawal strategies. For example, Kearns said, for the years when your taxable income will be lower than other years in retirement, you might pull from your traditional tax-deferred accounts for any money you need on top of your Social Security, because you will be in a lower tax bracket. Whereas in years when your taxable income might be higher — say, when you have to start taking required minimum distributions from an IRA or you're selling a taxable asset — you might tap your tax-free savings to supplement the money you need for living expenses. 6. Do you want to leave a legacy? Roth accounts have advantages over tax-deferred accounts when bequeathing money to non-spousal heirs. No matter which type of account they inherit, your heirs must take all the money from them within 10 years. But with traditional tax-deferred 401(k)s and IRAs, they must take distributions every year and pay the tax on them. That may have the effect of pushing them into a higher tax bracket, Kearns said. 'They will have a tax bill they might not having been planning on.' But with the Roth, not only do they get the money tax free, they don't have to take regular distributions during the 10-year window, and instead may take it out all at once in the 10th year, Popernik said. That gives them another decade of tax-free growth on their inheritance. Sign in to access your portfolio
CNN
06-04-2025
- Business
- CNN
Wondering if you should convert your tax-deferred retirement savings to a Roth? Here's what to consider
Having financial flexibility in retirement — especially in being able to maximize your spending while minimizing your taxes — is an optimal situation. And it's one you can arrange by keeping at least some of your retirement savings in a tax-free account. 'You're giving yourself more options in the future,' said Brian Kearns, an Illinois-based certified public accountant and certified financial planner. One way to do that is to convert at least some of your tax-deferred savings in your 401(k) or traditional IRA into a Roth account. Money rolled into Roth 401(k)s and Roth IRAs grow tax free and may be withdrawn tax-free so long as you leave it in the account for at least five years after the rollover. Unlike creating a Roth IRA and making new contributions to it every year, there is no income limit on who may convert their savings into a Roth (or who may contribute to a Roth 401(k) on an ongoing basis, either). Another advantage: In retirement, you get to decide how much and when you make withdrawals from your Roth savings, whereas with tax-deferred savings in traditional IRAs or 401(k)s, you must start taking required minimum distributions at age 73. That said, Roth conversions aren't the right answer for everyone. Here is a look at what to consider before making a move. The vast majority of 401(k) plans (93%) let participants create a Roth 401(k) account within the plan; and 60% of those allow for so-called 'in-plan Roth conversions,' according to the Plan Sponsor Council of America. An in-plan conversion means you can choose to convert some or all of your accumulated tax-deferred savings into after-tax Roth savings. The catch: You will have to pay the income tax owed on any money you convert the year you make the conversion. That's why for a lot of people the decision of how much to convert at any one time comes down to whether they have money available to pay that tax bill, said Tara Popernik, the head of wealth strategies at Bernstein Private Wealth Management. Say you convert $100,000 this year. That amount is added to your gross income and may end up pushing you into a higher tax bracket. So, say you're normally in the 22% federal bracket, it could push you into the 24% bracket. And that means on top of the taxes you owe on your annual income, you might owe an additional $24,000 (24% x $100,000) plus any applicable state income tax. If ever there was a time to consult a CPA, or a certified financial planner with tax experience who has helped many clients weigh Roth options, this is it. (They also can help you assess whether a conversion will make sense should lawmakers later this year choose to extend some or all of the expiring 2017 tax provisions.) But, generally speaking, here are some questions to consider when deciding whether a conversion would be a good move: 1. Do you expect your income to grow between now and retirement? If you're in the first half of your career, chances are your earnings will grow between now and when you call it quits. And that means you're likely to move into a higher tax bracket in the coming years. So it might be more advantageous to do a conversion sooner rather than later because your tax bill will be lower and your tax-free savings will have longer to grow. 2. Can you afford the immediate tax bill? Ideally, you should have enough cash on hand to pay that one-time tax bill — cash you will not need for current living expenses, upcoming debt payments or emergencies. If you have to raise the cash, Popernik said, try to avoid selling anything that would incur a capital gains tax, because that would reduce the advantage of converting. So, too, in most instances, would tapping your tax-deferred retirement savings just to pay the conversion bill — especially if you're under 59-1/2, since you will be subject to a 10% early withdrawal penalty on top of the income taxes you'd owe. Again, lean on your tax adviser to help you figure out which, if any, cash-raising strategy makes sense. If it turns out paying the tax bill on a lump-sum conversion would be too burdensome, and you have the option of contributing to a Roth 401(k), you can start making taxable contributions to it on a go-forward basis. Or, if your income is low enough, you can start your own Roth IRA. 3. Will your taxes go up in retirement? Trick question. The only truly correct answer is 'Who knows?' But, based on the tax system we have today, you can roughly gauge where things might go if the world — and the US tax code — don't do a complete 180. Generally speaking, if you anticipate your income taxes will be higher in retirement than now, converting tax-deferred savings to a Roth is likely advantageous. And by making a conversion sooner, you're likely to get the most value from it. 'The longer the money stays invested in the Roth, the bigger the benefit,' Popernik said. 4. When is the best time to convert, markets-wise? A recent analysis from Bernstein Private Wealth Management suggests the ideal time to convert your tax-deferred money to a Roth would be when markets are down. If you do, you'll get the most bang for your tax buck. By investing in assets through a Roth when they are at their lows, 'the subsequent gains when the recovery takes hold can be sheltered in a tax-free environment,' the report noted. That said, it's impossible to time market lows and highs. And the Bernstein analysis found that even converting when asset prices are at a peak may still confer long-term tax-free gains that might make a conversion worth it. 5. What income sources will you draw on when you retire? One way to guesstimate your tax obligations in retirement vs. now is to consider a) how much income you'll need to live on; and b) what your income sources will be, keeping in mind that not all sources of income are taxed alike. So, for instance: Will you have income from a pension on top of your Social Security benefits? Will you receive rental income from a property? Will you be drawing on taxable income like interest and dividends? Or on tax-free interest from municipal bonds? Having both taxable and tax-free savings to draw on can help you optimize your withdrawal strategies. For example, Kearns said, for the years when your taxable income will be lower than other years in retirement, you might pull from your traditional tax-deferred accounts for any money you need on top of your Social Security, because you will be in a lower tax bracket. Whereas in years when your taxable income might be higher — say, when you have to start taking required minimum distributions from an IRA or you're selling a taxable asset — you might tap your tax-free savings to supplement the money you need for living expenses. 6. Do you want to leave a legacy? Roth accounts have advantages over tax-deferred accounts when bequeathing money to non-spousal heirs. No matter which type of account they inherit, your heirs must take all the money from them within 10 years. But with traditional tax-deferred 401(k)s and IRAs, they must take distributions every year and pay the tax on them. That may have the effect of pushing them into a higher tax bracket, Kearns said. 'They will have a tax bill they might not having been planning on.' But with the Roth, not only do they get the money tax free, they don't have to take regular distributions during the 10-year window, and instead may take it out all at once in the 10th year, Popernik said. That gives them another decade of tax-free growth on their inheritance.
NBC News
25-03-2025
- Business
- NBC News
How the rich use insurance to invest in private credit without steep tax bills
Private credit has exploded in popularity among investors, with the market soaring from $1 trillion in 2020 to $1.5 trillion at the beginning of 2024, according to alternative data provider Preqin. The firm expects this figure to reach $2.6 trillion by 2029. But private credit investing comes with a serious catch. The returns from direct lending are taxed as ordinary income, which has a top federal tax rate of 40.8%, rather than long-term capital gains, for which rates top 23.8%. This can cost investors millions in returns. For instance, a $5 million investment in private credit could incur $4.3 million in tax drag over 10 years and $61 million over 30 years, according to Bernstein Private Wealth Management. There are several ways for investors to mitigate their tax liability. The most straightforward is investing through a Roth IRA, but these tax-advantaged accounts are off-limits to high earners. Instead, high-net-worth investors are increasingly turning to insurance to save on taxes. Instead of investing directly in a private credit fund, they take out insurance policies that invest the premiums in a diversified portfolio of funds. 'You're getting taxed on the insurance product, rather than being taxed on the underlying private credit investment,' said Yasho Lahiri, funds lawyer and partner at Kramer Levin. These insurance dedicated funds (IDFs) have multiplied rapidly, according to Lahiri. (The exact number is unclear as many of these funds are unregistered.) IDFs have to be diversified to meet IRS requirements, which can mean weaker returns than picking one top-performing funds, according to Robert Dietz, national director of tax at Bernstein. However, these funds have other benefits, such as offering better liquidity than private credit funds typically do. There are two primary options for investing in an IDF. The cheapest route is taking out a private placement variable annuity (PPVA) contract with an insurance carrier. Dietz told CNBC that these annuity policies can make sense for clients with investible assets in the range of $5 million to $10 million. However, the income taxes associated with that holding are only deferred until the policy owner takes a withdrawal or surrenders the contract. 'At some point someone's going to have to get hit with that deferred income tax liability,' Dietz said. 'That might be the individual who is purchasing the annuity if they decide to take a distribution out in the future, or it could be their beneficiaries when their beneficiaries inherit the annuity.' The most tax-efficient option is taking out a private placement life insurance (PPLI) policy. Structured correctly, the policy owner's death benefit is untaxed when it is paid to beneficiaries. Some clients are turned off by the multimillion-dollar upfront premium and cumbersome underwriting of PPLI policies, but it can be worth it. Dietz said the vehicles can be a good fit for clients with at least $10 million in investible assets. 'If my policy is not structured carefully, my insurance costs can get very expensive, and that can start to eat away at the benefit I'm getting from that cash value accumulating in the policy,' he said. Since PPLI and PPVAs are unregistered financial products, you must be an accredited investor or qualified purchaser to access them. Accredited investors must earn at least $200,000 annually or have a net worth of more than $1 million, not including a personal residence. For qualified purchasers, the investible asset minimum jumps to $5 million. However, these thresholds have not kept up with inflation or stock market growth, making IDFs more accessible, according to Lahiri. A powerful tax avoidance tool, PPLI can be used without IDFs and utilized to pass down a wide array of assets, including entire businesses, tax-free. It has caught the attention of Congress, with an investigation by the Senate Committee on Finance describing the PPLI industry as 'at least a $40 billion tax shelter used exclusively by only a few thousand wealthy Americans.' Sen. Ron Wyden, D-Ore., then chair of the committee, drafted a proposal in December to curb the tax advantages of PPLI, however that bill is unlikely to pass with a Republican-controlled Congress. The talk of potential legislation only briefly put clients off PPLI last year, according to Dietz. Client demand for private credit and tax-efficient ways to get a piece of the action is only increasing. 'Family offices and ultra-high-net-worth clients are looking for ways to maximize after-tax returns, and the low-hanging fruit — the long-only equity portfolios and tax-loss harvesting — has already been implemented,' he said. 'We're definitely having more conversations with clients around this.'
