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Are Your Investment Fees Deductible?

"With the rise of comprehensive wealth management, it is increasingly common for clients to pay a single bundled AUM fee that covers not only deductible investment management services but also non-deductible planning expenses. Technically, though, those clients should probably only be deducting a portion of the AUM fee, not the entire amount -- at least where the AUM fee covers a material amount of planning services. The issue is especially concerning when it comes to retirement accounts such as IRAs, where paying a personal financial planning fee with retirement assets could trigger a taxable deemed distribution, or even disqualify the entire IRA as a prohibited transaction.... [F]or some firms, unbundling fees can present challenges in communicating the value of their services."

Best Strategy for Portfolio Withdrawals?

"[W]hen such bucketing or decision-rules strategies are paired with simple rebalancing, ... the outcome is no better than merely managing the portfolio on a total-return basis alone.... [S]imple rebalancing already has an astonishingly powerful effect in helping to avoid unfavorable liquidations, as the process systematically ensures that the investments that are up (the most) are sold, and the ones that are down (the most) are held and, in fact, bought instead. This means advisors may not be giving rebalancing alone nearly the credit it deserves to accomplish similar -- or even better -- results than setting aside buckets and creating decision rules."

When NOT to Convert to a Roth IRA

"Ultimately the decision of whether to bequest a Roth or traditional IRA should be driven by a comparison of the original IRA owner's marginal tax rate and the expected marginal tax rate of the beneficiary in the future. If the beneficiary's tax rates will be higher, it's better for the current IRA owner to go ahead and convert the IRA, paying the taxes now at current rates and leaving the higher-income beneficiary a tax-free account. But if the beneficiary's tax rates will be lower -- for any number of reasons -- then the best thing a wealthy IRA owner can do is leave a traditional IRA, and let the beneficiary pay the taxes at his own lower tax rate."