Aug 22, 2025
Client Background
A working-age client with a strong income approached us to refine their financial strategy. They were charitably inclined and held a significant portfolio of appreciated stock. Their goal was to maximize their charitable impact while optimizing their tax situation.
Challenge
The client’s itemized deductions were close to the standard deduction, meaning they weren’t fully leveraging their charitable contributions for tax benefits. Donating cash would have required selling appreciated stock, triggering capital gains taxes and reducing the amount available for charity.
Solution
We implemented a “bunching” strategy using a Donor-Advised Fund (DAF). Every other year, the client donated a large amount of appreciated stock to the DAF, which sold the stock tax-free, allowing them to claim a full charitable deduction based on the stock’s market value. In those years, they took the itemized deduction, which exceeded the standard deduction. In alternate years, they took the standard deduction and distributed funds from the DAF to their chosen charities, maintaining their annual giving without additional stock contributions.
Why Donate Appreciated Stock to a DAF?
Donating appreciated stock to a DAF allows you to contribute the full market value of the stock without incurring capital gains taxes, as the DAF sells the stock tax-free. This maximizes your charitable deduction and the funds available for your chosen causes.
By bunching deductions into a single year, you can exceed the standard deduction, significantly reducing your taxable income in that year, while still supporting charities annually through DAF distributions in subsequent years, when you take the standard deduction.
Results
This approach allowed the client to increase their charitable impact while reducing their tax liability. By alternating between itemized and standard deductions, they optimized their tax savings and maintained consistent support for their charities. The strategy provided flexibility and aligned their giving with their financial goals.
Are you maximizing the tax benefits of your charitable giving? Contact Michael Brady for a personalized consultation to discuss how your wealth can align with purpose and possibility.
Aug 22, 2025
Client Background
A couple with a young child approached us to plan for their child’s future education. They wanted a flexible savings vehicle that accounted for the possibility that their child might not attend college.
Challenge
The couple was torn between a Uniform Transfers to Minors Act (UTMA) account and a 529 plan. They were concerned about committing funds to a 529 if their child chose a non-educational path, potentially facing penalties or taxes on withdrawals.
Solution
After comparing options, we recommended a Colorado 529 plan due to its flexibility and tax benefits. Contributions to a Colorado 529 plan qualify for a state income tax deduction, and earnings grow tax-free when used for qualified education expenses. We outlined the following pros for each option:
| Feature |
UTMA |
Colorado 529 Plan |
| Tax Benefits |
No tax deductions; earnings taxed annually |
State tax deduction; tax-free growth for education |
| Flexibility |
Funds usable for any purpose |
Primarily for education, but flexible options |
| Control |
Child gains control at 21 |
Account owner retains control |
| Investment Options |
Broad investment choices |
Limited to plan’s investment options |
If the child does not pursue higher education, the 529 plan offers flexibility:
- Change the beneficiary to another family member.
- Use funds for vocational or trade schools.
- Withdraw funds for non-educational purposes (subject to taxes and a 10% penalty on earnings).
- Use up to $10,000 for student loan repayment or K-12 tuition.
Results
The couple began monthly contributions to a Colorado 529 plan, benefiting from the state tax deduction and tax-free growth. The plan’s flexibility reassured them that their savings could adapt to their child’s future choices, whether educational or otherwise, aligning with their goal of financial security.
Are you planning for your child’s future with flexibility in mind? Contact Michael Brady for a personalized consultation to discuss how your wealth can align with purpose and possibility.
Aug 22, 2025
Client Background
A client in their 60s, a non-executive employee of a company, held a concentrated stock position in their employer’s shares. They approached us to review their retirement portfolio.
Challenge
The client’s portfolio was heavily concentrated in one stock, which had multiplied in value, fueling their belief in the company’s future. However, this concentration posed significant risk, especially as they neared retirement, as a single company’s failure could devastate both their job and investments.
Solution
We advised diversifying their portfolio to reduce risk, emphasizing that even strong companies can face unexpected challenges. We recommended gradually selling portions of the concentrated stock and reinvesting into a diversified mix of assets aligned with their retirement goals. Unfortunately, the client chose not to follow this advice.
Results
The company faced an accounting scandal and went bankrupt, rendering the client’s stock worthless. They lost both a significant portion of their retirement savings and their job, severely impacting their retirement plans. Had they diversified, their nest egg would have been preserved despite the job loss. This underscored the importance of diversification, regardless of confidence in a single company.
Is your portfolio exposed to unnecessary risk? Contact Michael Brady for a personalized consultation to discuss how your wealth can align with purpose and possibility.
Aug 22, 2025
Client Background
A couple approached us after the husband received a terminal diagnosis with a five-year prognosis. The husband, who managed their finances, wanted to ensure his wife’s financial security after his passing.
Challenge
The wife had limited experience with financial decision-making, and the couple’s children lived across the country, making ongoing family involvement challenging. The husband sought a trusted advisor to guide his wife post-mortem.
Solution
We developed a relationship with both spouses, involving the wife in all financial decisions to build her confidence. The husband gradually delegated control to us, ensuring a seamless transition. We also engaged their children to align the family with the wife’s future financial plans, maintaining her authority with our guidance.
Results
After the husband’s passing, the wife confidently managed their finances with our support, exceeding the initial prognosis period. The family remained united in supporting her decisions, and our ongoing relationship ensured her financial stability and peace of mind.
Are you planning for your family’s financial future? Contact Michael Brady for a personalized consultation to discuss how your wealth can align with purpose and possibility.
Aug 22, 2025
Client Background
A business owner planning to exit their company in three to five years sought our advice to ensure sufficient retirement funds.
Challenge
The client’s wealth was heavily tied to their business, and their personal savings alone might not support their desired retirement lifestyle. Business-related expenses, like company cars and health insurance, complicated their financial planning post-exit.
Solution
We conducted a retirement analysis to determine the minimum sale price needed to meet their retirement goals. We adjusted their profit and loss statement to account for personal expenses previously covered by the business. Working with a certified value growth advisor and exit planning advisor, we maximized the business’s value through strategic improvements, ensuring a higher sale price.
Results
The client achieved clarity on the business sale price needed for their retirement lifestyle. Our collaborative approach enhanced the business’s value, increasing the likelihood of a successful exit. The client gained confidence in their retirement plan, knowing their personal and business finances were aligned.
Are you preparing for a business exit? Contact Michael Brady for a personalized consultation to discuss how your wealth can align with purpose and possibility.
