Autumn — The Perfect Time to Give Thanks for the Year’s Bounty

Ah, autumn. ‘Tis the time of year when the warm days of summer give way to the cool days of fall. This is the season we celebrate the harvest season.

Autumn can be the perfect time to give thanks and enjoy the bounty of the harvest season, with activities such as visiting farmers’ markets, pumpkin patches, and apple picking. Traditional harvest festivals, from Thanksgiving in North America to Oktoberfest in Europe, celebrate the year’s bounty.

This time of year, with its rich flavors and golden hues, reminds us of the rewards of hard work.

One Great Way To Celebrate Is To Enjoy Produce At Its Peak

Did you know eating seasonal fruit during the day can reduce brain inflammation, boost memory, and even improve communication skills? It’s a simple but often overlooked way to support focus, morale, and overall well-being, according to Erin Mittelstaedt, CEO of San Francisco-based The FruitGuys.

Supporting mental health and well-being can be complicated, but Mittelstaedt says there are easy ways to move in the right direction. Here are a few of her strategies you can use around your home and workplace:

Encourage microbreaks with seasonal snacks. Snack breaks count. Encourage family and employees to take short pauses during the day and offer fresh, in-season fruit like apples  and pears to help reduce stress and improve focus.

Stock your home and break room with fresh fall fruit. Fresh fruit is linked to a lower risk of anxiety and depression. Seasonal produce, such as grapes and persimmons, supports both physical and mental health while adding warmth and color to the home and office.

Make healthy eating easy and visible. At work, keep fruit within reach on office counters, in the break room, or near coffee stations. When healthy choices are convenient, family and employees are more likely to refuel with something nourishing during busy fall days.

Time To Reflect On Retirement Harvest Season

Speaking of enjoying the fruits of your labors, there is also a harvest season for your retirement distributions.

Consider the ancient proverb that says there is a time for everything; a time to sow, and a time to reap.

In financial planning, we liken the sowing season to the accumulation phase of building up your nest egg; we liken the reaping season to the distribution phase of spending your money in retirement.

In the harvest season of your retirement, you do not want to overpay taxes to Uncle Sam.

Major mistakes retirees make during the distribution process typically involve misunderstanding Required Minimum Distributions (RMDs), mismanaging withdrawals, and underestimating key financial factors.

Errors in these areas can lead to unnecessary taxes, penalties, and even running the risk of outliving one’s savings.

Not having a clear distribution strategy. A plan should outline which accounts to withdraw from and when, to maximize tax efficiency. A “lack of tax diversification” (having all savings in pre-tax accounts) can limit your options.

Adhering too strictly to the 4% rule. While a useful guideline, the 4% rule is not a one-size-fits-all solution. A rigid withdrawal rate does not account for market fluctuations, inflation, or your changing needs throughout retirement.

Missing or delaying the first Required Minimum Distribution (RMD). The age of starting RMDs has changed. It is currently 73 for those born between 1951 and 1959 and will rise to 75 for those born in 1960 or later.

Forgetting to take RMDs. Failing to take your RMD by the deadline results in a penalty of 25% of the amount you were supposed to withdraw.

Being too risk-averse. Being overly cautious and moving completely into conservative investments can cause you to exhaust your funds. You will need some growth potential in your portfolio to outpace inflation, as retirement can last for several decades.

Failing to plan for taxes. Withdrawals from traditional IRAs and 401(k)s are taxable income, which can increase your tax bracket, potentially raising your Medicare premiums (IRMAA) and taxes on Social Security benefits.

Not utilizing Qualified Charitable Distributions (QCDs). If you are 70½ or older, you can donate up to $105,000 annually directly from your IRA to a charity. This distribution counts toward your RMD but is not included in your taxable income, which can be a powerful tax-saving strategy.

Ignoring the impact of market fluctuations. The previous year’s market can affect your RMD calculation for the current year. A market downturn may suggest adjusting your withdrawal plan to avoid selling assets at a loss.

If you would like a second opinion on your distribution plans, we are here to help. Paying the proper attention is key to a successful retirement. Sometimes, a few well-thought-out actions can make a huge difference.

Consider the Buddhist proverb that extends the concept of sowing and reaping, with how small actions compound into a life’s outcome: “Sow a thought and you reap an action, Sow an action and you reap a habit, Sow a habit and you reap a character, Sow a character and you reap your destiny.”