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Daniel Logan, MS, AAMS

@dl_wealth

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💵 Finance & Investing
📈 Helping High-Earners Build Wealth
⭐️ Vice President at Logan + Reed Wealth Partners
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Lump sum or DCA... one of the most common questions I get from investors sitting on a large cash balance.

The math is pretty clear. Lump sum wins most of the time. Markets trend up, so every day your money isn't invested is a day it's not compounding.

But math doesn't account for behavior.

If you invest $200K all at once and it drops 20% the next month, what do you do? For a lot of people, the answer is panic. And panic is expensive.

A DCA strategy that eases you in over 3-6 months won't maximize returns on paper... but if it keeps you invested and consistent, it wins in the long run.

The best strategy is the one you can actually stick to.

#investing #financialfreedom #financialplanning #stocks taken in San Diego, California by @dl_wealth

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7 months ago

Most people have one savings account and call it a plan.

The way I think about cash management... you need two buckets with two different jobs.

An emergency fund is for the things you don't see coming. Job loss. Medical bills. Legal issues. Having one is essential.

A sinking fund is for the things you know are on the horizon. Vacations. Property taxes. Home renovations. These are goals, not emergencies. Having a separate bucket for planned expenses keeps you from dipping into your emergency fund for things that shouldn't be emergencies in the first place. It also makes it easier to stay invested everywhere else because you've already accounted for the spending you know is coming.

Cheyenne and I have attended over 10 weddings in the past year where flights and gifts can add up quick (perfect use of the sinking fund).

When both buckets are covered, the rest of your cash should be positioned to grow. Cash beyond that sitting idle isn't doing you any favors.

#cashmanagement #financialplanning #investing101 #financetips taken in San Diego, California by @dl_wealth

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7 months ago

Most people try to budget by tracking every dollar they spend.

It's exhausting. And it usually doesn't stick.

Reverse budgeting flips the script...

Instead of tracking what you spend, you automate what you save first. Then spend the rest guilt-free.

Here's how it works

1.) Identify your savings goals upfront. Retirement, brokerage, real estate, whatever matters to you.

2.) Automate contributions on payday.

3.) Spend what's left how you want.

No spreadsheets. No guilt. No micromanaging.

The simplest financial habit change you can make.

#budgeting #financialfreedom #investing #financialplanning taken in San Diego, California by @dl_wealth

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7 months ago

Life insurance and annuities are two of the most commonly confused financial products out there.

And honestly, it makes sense. They are both offered by insurance companies and both deal with protecting your financial future.

But they serve very different purposes.

Life insurance is designed to protect the people you leave behind. If something happens to you, your beneficiaries receive a death benefit to help replace your income and cover expenses.

Annuities are essentially the opposite. They are designed to protect you from outliving your money by providing a steady stream of income during retirement.

Think of it this way: life insurance protects others from your early death, while annuities protect you from running out of money if you live longer than expected.

Neither one is inherently better than the other. It comes down to your unique situation, your goals, and where you are in life.

If you have dependents relying on your income, life insurance should be part of the conversation. If you are approaching retirement and worried about maintaining your lifestyle, annuities might deserve a closer look.

The key is understanding what each tool does and using them intentionally... not as standalone products, but as part of the broader plan.

#financialplanning #retirementplanning #lifeinsurance #wealthadvisor taken in San Diego, California by @dl_wealth

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8 months ago

Most people focus on what to invest in. But where you invest can matter just as much, if not more, when it comes to your tax bill.

This table breaks down the tax treatment of five common retirement accounts across three categories: contributions, growth, and withdrawals.

The HSA is the only account that gets a green checkmark in all three columns. Contributions are tax-deductible, growth is tax-free, and withdrawals are tax-free when used for qualified medical expenses. Important caveat here: if you withdraw HSA funds for non-medical purposes before age 65, you will owe taxes plus a 20% penalty. After 65, non-medical withdrawals are taxed as ordinary income but the penalty goes away. Despite these rules, the HSA remains one of the most powerful and underutilized tools in financial planning.

Traditional IRAs and 401(k)s give you a tax break upfront. Your contributions are made with pre-tax dollars, which lowers your taxable income today. The tradeoff is that you will pay taxes on both the growth and withdrawals down the road.

Roth IRAs and Roth 401(k)s flip that equation. You contribute after-tax dollars, so there is no upfront deduction. But your money grows tax-free and comes out tax-free in retirement. If you believe your tax rate will be higher in the future, Roth accounts can be a powerful tool.

There is no single "best" account. The right mix depends on your income, your tax situation, and when you plan to access the money. In many cases, having a combination of account types gives you the most flexibility in retirement.

Understanding the tax rules of each account is a critical piece of building a long-term wealth strategy. It is not just about how much you invest. It is about where you put it.

#retirementplanning #investment #RothIRA #financialplanning taken in San Diego, California by @dl_wealth

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8 months ago

You have left your employer. What do you do with your 401(k)?

The 401(k) is often the forgotten about investment account for many Americans, even though it can account for a significant portion of one's net worth.

When leaving an employer, it is important to remember that you have four options.

Option 1: Leave it in your former employer's plan. This can be the most hassle-free option in the short term, but it often creates headaches down the road. Many years in the future, it can become hard to remember your login information or even the name of your 401(k) provider. This leads to investors forgetting to rebalance their portfolios, which can have a significant effect on performance.

Option 2: Roll it over to your new employer's plan. This can be a good option if your new employer has a quality 401(k) plan with relatively low fees. However, it can limit your potential investment universe, which can impact returns in the long run.

Option 3: Roll it over into an individual retirement account (IRA). An IRA allows for maximum flexibility as it allows you to invest in a variety of vehicles including low-cost index funds, mutual funds, and even real estate. A diversified portfolio is important especially as your IRA grows, and an IRA gives investors that ability.

Option 4: Take a lump-sum cash distribution. Cash distributions are subject to a 10% early withdrawal penalty if under the age of 59 1/2 and the amount is subject to ordinary income taxes. Additionally, you are stealing from your future self. These funds were set aside to provide for you during retirement. By withdrawing them early you are interrupting the compounding that is taking place.

Everyone's situation is unique, but it is important to consider all your options when dealing with an old 401(k). Most importantly, don't forget about it. Make a decision on what to do with your 401(k) when leaving an employer.

#investing #retirementplanning #retirement #financialplanning taken in San Diego, California by @dl_wealth

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8 months ago

Want to know when your money might double? Triple? There's a shortcut for that ↓

Here are three simple rules that help you estimate how long it might take for money to grow with compound returns.

These are mental math shortcuts, not predictions, but they make long-term planning easier to visualize. These rules help you estimate timing, not dollar values.

Rule of 72
Helps you estimate when your money might double.
Take 72 and divide it by your annual rate of return. For example, at an 8 percent rate of return, money doubles in about 9
years.

Rule of 114
Helps you estimate when your money might triple.
Using the same 8 percent return, your money might triple in about 14 years.

Rule of 144
Helps you estimate when your money might quadruple.
At 8 percent, the estimate is about 18 years.

These are approximations and actual returns will vary from year to year. Markets are unpredictable, but the long-term effect of compounding is real. Starting earlier gives you more compounding cycles, which can have a major impact on your future outcome.

#compoundgrowth #personalfinance #WealthBuilding #investing taken in San Diego, California by @dl_wealth

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10 months ago

Every financial decision comes back to three numbers -- how much you earn, invest, and spend.

For many people, the missing link is the investment rate.
I encourage households to target at least 20% of gross income for investing. This includes your 401(k) contributions, HSA contributions (if invested), and any brokerage account deposits.

How to calculate: (Total Annual Investments ÷ Gross Income) × 100

Example: You make $100K. Your 401(k) contributions are $10K, you invest $3K in your HSA, and add $7K to your brokerage account. That's $20K invested on $100K gross = 20% investment rate.

Not what's left over at the end of the month -- right from the top.

A 20%+ investment rate can help build independence quickly.

It's not about perfection, it's about consistency.

Earn well, invest consistently, spend with intention.

The rest tends to fall into place.

#investing #budgeting #spending #finance taken in San Diego, California by @dl_wealth

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a year ago

Dividends are a share of a company's profits paid to you, either in cash or more stock.

The number of shares in the company you own determines your payout, which you can keep in cash, reinvest into more stock, or saved and earning interest for future use.

For younger investors, focusing on growth stocks with strong capital appreciation potential may often align better with long-term wealth building goals. However, as investors approach or enter retirement and seek more stability and regular income, dividend-paying stocks can become an increasingly attractive component of a well-balanced portfolio.

Whether you're in it for passive income or long-term growth, dividends can be a powerful tool for investors.

#investing #dividends #passiveincome #financialplanning #wealthadvisor taken in San Diego, California by @dl_wealth

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a year ago

Setting your child up for future financial success begins at a young age. Start today with these accounts to plan for higher education expenses, general investing, and even retirement.

529 Plan:
-Earnings grow tax-free, and withdrawals for qualified education expenses are also tax-free
-Qualified expenses include tuition, fees, books, supplies, and room & board
-Includes up to $10,000/year for K-12 tuition and up to $10,000 in student loan repayment
-The account owner maintains control, even after the beneficiary reaches adulthood

Custodial Roth IRA:
-A great option for a minor who has earned income from a job
-Parent or guardian manages the account until child reaches 18 or 21, depending on the state
-Amount contributed must be equal to or less than the child's taxable earned income, with a limit of $7,000/year (2025).
-Contributions (not earnings) can be withdrawn penalty-free

UGMA/UTMA:
-Managed by a parent or guardian until child reach 18 or 21 (depending on state)
-Once assets are placed in this account, they belong to the minor
-Can invest in stocks, bonds, ETFs, mutual funds
-No restriction on how the funds are used
-No income limits or contribution caps

#financetips #investing #financialplanning #wealthadvisor taken in San Diego, California by @dl_wealth

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a year ago

Your primary income is your most crucial tool for building long-term wealth.

However, along the way, it can be helpful to create passive income streams that do not require your day-to-day involvement.

Passive income streams usually require an upfront investment in an asset that will work to produce returns in the form of income over time.

Four ways to generate passive income:

-Tax-efficient real estate investments through real estate investment trusts (REITs) or private real estate

-Dividend-paying stocks

-Bonds and bond funds

-Private equity investments or private debt

The right mix of these investments depends on your goals, risk tolerance, and time horizon.

Done strategically, passive income streams may provide stability, growth, and potential tax savings over time.

#passiveincome #wealthbuilding #wealthbuildingtools #financialplanning

Disclosures: Dividends are not guaranteed and must be authorized by the company’s board of directors. Be advised that investments in real estate and in REITs have various risks, including possible lack of liquidity and devaluation based on adverse economic and regulatory changes. Additionally, investments in REIT’s will fluctuate with the value of the underlying properties, and the price at redemption may be more or less than the original price paid. There are special risks associated with investing with bonds such as interest rate risk, market risk, call risk, prepayment risk, credit risk, reinvestment risk, and unique tax consequences. Alternative Investments involve substantial risks that may be greater than those associated with traditional investments and may be offered only to clients who meet specific suitability requirements, including minimum net worth tests. Strategies and investments mentioned herein may not be suitable for all investors. taken in San Diego, California by @dl_wealth

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a year ago

Retirement account jargon can get confusing.

You've probably heard the terms rollover and conversion - but do you know what they actually mean?

A rollover is simply moving money from one retirement account to another retirement account with the same tax status. This means pre-tax (AKA traditional) to pre-tax, or post-tax (AKA Roth) to post-tax. You most commonly conduct a rollover when you have left your job, and want to roll the 401(k) at your old company into the 401(k) at your new company OR into an IRA, rather than leave it with your old employer or cash it out.

A conversion on the other hand, takes pre-tax dollars and moves them into a Roth IRA. This is a taxable event, however your money will then be allowed to grow tax-free. A common reason for a conversion is if you are in an unusually low tax year (possibly due to a job change or business loss). It means you are paying taxes at a lower rate than you might in the future. Another reason may be that you want your heirs to inherit money income-tax free. This is a way to leave assets behind more efficiently.

If you are considering one of these two moves, I would urge you to consider all your options and evaluate your lifetime tax picture.

It's never going to be perfect, but it's worth the time.

#wealthadvisor #wealthbuilding #RothIRA #investing

Disclosure:
401(k) are long-term retirement savings vehicles. Withdrawal of pre-tax contributions and/or earnings will be subject to ordinary income tax and, if taken prior to age 59 1/2, may be subject to a 10% federal tax penalty. Contributions to a traditional IRA may be tax-deductible depending on the taxpayer’s income, tax-filing status. Unless certain criteria are met, Roth IRA owners must be 59½ or older and have held the IRA for five years before tax-free withdrawals are permitted. Additionally, each converted amount may be subject to its own five-year holding period. Converting a traditional IRA into a Roth IRA has tax implications. Investors should consult a tax advisor before deciding to do a conversion. taken in San Diego, California by @dl_wealth

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a year ago