# Leading Edge Financial > Providing Your Flight Plan for Financial Freedom > Admin Email: info@leadingedgeplanning.com ## Posts ### College Savings Showdown: Texas Pre-Paid vs. 529 Plans https://www.youtube.com/watch?v=EvHJraNzd2g Join Kevin Gormley, CFP®, CPA, PFS and Nolan Clark, CFP®, B.S. (Finance) from Leading Edge Financial Planning as they break down two tax-advantaged college savings tools available to Texas families: 529 college savings plans and the Texas Tuition Promise Fund®. In this conversation, Kevin and Nolan explain how each option works, who may benefit most, and how combining the two may create a flexible, well-rounded approach to funding future education costs. Whether you’re a new parent or already deep into college planning, this video may give you the clarity and confidence you need to make smart, informed decisions for your family’s future. Key Topics Covered: Introduction & Overview of College Savings Options Details of the Texas Prepaid Tuition Program (Texas Tuition Promise Fund®) Comparison of 529 Plans and Prepaid Programs Risks and Benefits of Each Plan Practical Steps for Using the Texas Prepaid Program Conclusion & Final Thoughts Actionable Takeaways: Research prepaid tuition programs in other states that may offer college saving opportunities. Explore the Texas Tuition Promise Fund website (https://www.texastuitionpromisefund.com/) and calculator to evaluate plan types, units, and payment options for your specific goals. Share this video with parents who may benefit from understanding their college funding options. Share other state pre-paid plans you’d like us to research and share. Saving for college may feel overwhelming, but the right strategy can make all the difference. Understanding how 529 plans and prepaid tuition work—and how they may be used to complement each other– may help you create a financial plan for your family’s future education.  For personalized guidance, visit Leading Edge Financial Planning or reach out to our team anytime.   Connect with Kevin Gormley  kevin@leadingedgeplanning.com  865-217-7779 Connect with Nolan Clark nolan@leadingedgeplanning.com  270-545-5880  Schedule a Time to Chat Read Before Fly Newsletter The Pilot Money Guys Podcast Pilot and High-Income Blog Take the Pilot Wealth Index Quiz Leading Edge YouTube Pilot Money Guys Instagram Submit a Suggestion #PilotMoneyGuys #LeadingEdgePlanning #CollegePlanning #529Plan #TexasPrepaidTuition #EducationSavings #PrepaidTuition #FinancialPlanning #ParentFinance #SmartMoneyMoves #WealthStrategy  Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Delta Air Lines Nonqualified Deferred Compensation (NQDC) https://youtu.be/NxS5qLG0NZw?si=pnTGCp9hFPehfJzNIn this episode, Kevin Gormley, CFP®, CPA, PFS, is joined by Andy Christopher, CFA®, MSF, to break down Delta Air Lines’ expanding benefits options, including the newly introduced Non-Qualified Deferred Compensation (NQDC) plan. If you’re a high-income Delta pilot exploring additional ways to save money, this discussion introduces you to an additional opportunity offered by Delta Air Lines starting in 2026. Kevin and Andy walk through the nuances of the Delta NQDC plan and how it’s different from other airlines’ plans. They share tax implications, investment considerations, payout structures, and some potential concerns and risks. Their goal is simple: help you make informed, long-term decisions that may strengthen your financial future. Key Topics Covered: Delta’s Retirement Account Options & NQDC Introduction IRS Contribution Limits Overview of Retirement Savings Strategies Deep Dive into Delta’s NQDC Plan Risk Management, Market Exposure & Tax Considerations Payout Options Managing Plan Complexity Practical Considerations and Next Steps Actionable Takeaways: Review the details of the Delta NQDC plan, and run scenarios with tax projections to understand the potential impact to your financial plan. Reach out to the Leading Edge team for personalized guidance or follow-up questions on the NQDC plan.   The Delta Air Lines’ Non-Qualified Deferred Compensation (NQDC) plan isn’t right for everyone. Understanding if you may want to include it in your financial plan depends on your unique circumstances. Connect with Kevin Gormley  kevin@leadingedgeplanning.com  865-217-7779   Connect with Andrew Christopher  andrew@leadingedgeplanning.com  901-664-3753 Schedule a Time to Chat Read Before Fly Newsletter The Pilot Money Guys Podcast Pilot and High-Income Blog Take the Pilot Wealth Index Quiz Leading Edge YouTube Pilot Money Guys Instagram Submit a Suggestion #LeadingEdgePlanning #PilotMoneyGuys #DeltaPilots #WealthBuilding #NQDC #DeferredCompensation #TaxPlanning #HighIncomeEarners #SmartMoneyMoves #DeltaLife #PilotFinance #CFP #DeltaFamily Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Delta Air Lines Group Variable Universal Life (GVUL) https://youtu.be/nSXxHoE5iVEIn this session, Kevin Gormley, CFP®, CPA, PFS from Leading Edge Financial Planning breaks down the Group Variable Universal Life (GVUL) insurance plan available to Delta Air Lines pilots. Kevin explains some of the pros and cons of GVUL and how it may fit into your broader financial strategy. You’ll learn about the key benefits of GVUL, including its reduced imputed income and post-retirement flexibility — along with some important cautions to consider before enrolling. Whether you’re an active pilot planning for retirement or evaluating your benefits during open enrollment, this discussion may help you make more informed financial decisions. Key Topics Covered: Introduction to GVUL for Delta Air Lines pilots How GVUL may fit into your financial plan Advantages of GVUL: portability and tax treatment Cautions and considerations before investing Actionable Takeaways: Evaluate whether GVUL aligns with your personal goals, financial priorities, and tax strategy. Reach out to the Leading Edge Financial Planning team to discuss GVUL or other Delta Air Lines benefits   GVUL may be a valuable tool for certain pilots — but like any financial decision, it’s important to understand why and how it fits into your overall plan. At Leading Edge Financial Planning, we help pilots clarify these choices so they can fly confidently — both in the air and in their finances. Connect with Kevin Gormley  kevin@leadingedgeplanning.com  865-217-7779 Schedule a Time to Chat Read Before Fly Newsletter The Pilot Money Guys Podcast Pilot and High-Income Blog Take the Pilot Wealth Index Quiz Leading Edge YouTube Pilot Money Guys Instagram Submit a Suggestion #PilotMoneyGuys #LeadingEdgePlanning #DeltaPilots #FinancialWellness #GVUL #LifeInsurance #FinancialPlanning #PilotFinance #DeltaGVUL #PilotBenefits #PilotFamily #PilotLife Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### American Market-Based Cashed Balance Plan (MBCBP) https://www.youtube.com/watch?v=XXuVy5jCgeIIn this video, Mark Covell, MBA, BSME, from Leading Edge Financial Planning breaks down the new American Airlines Market-Based Cash Balance Plan (MBCBP), a major update that may significantly impact pilots earning over $260,000. Mark explains how the MBCBP works, who it affects, and what key decisions need to be made before December 15. You’ll learn about the two tier options (Tier 1 vs. Tier 2), how “spillover cash” is allocated, and the investment strategy behind the plan, all with the goal of helping you make a confident, informed election that aligns with your financial and tax planning goals. Key Topics Covered: American Airlines Cash Balance Plan Overview Election Period and Tier Options Investment Rules and Conservative Nature Withdrawal and Annuity Options Examples of Cash Balance Plan Scenarios Tax Implications and Financial Advice Actionable Takeaways: Reach out to an advisor (such as Mark Covell at Leading Edge Financial Planning) to review your specific MBCBP options. Make your Tier 1 (MBCBP) or Tier 2 (status quo) election by December 15 to ensure your 2026 benefits are aligned with your financial strategy.   The new MBCBP may offer meaningful benefits, but the right choice depends on your personal income, savings goals, and tax situation. Making an informed decision now could help you optimize your compensation, minimize taxes, and strengthen your retirement strategy for years to come. Connect with Mark Covell  mark@leadingedgeplanning.com  530-539-1466 Schedule a Time to Chat Read Before Fly Newsletter The Pilot Money Guys Podcast Pilot and High-Income Blog Take the Pilot Wealth Index Quiz Leading Edge YouTube Pilot Money Guys Instagram Submit a Suggestion #PilotMoneyGuys #LeadingEdgeFinancialPlanning #SmartMoneyMoves#AmericanAirlinesPilots #MBCBP #CashBalancePlan #AviationProfessionals#PilotFinance #RetirementPlanning #AviationFinance #RetirementReady#TaxPlanning #FlightCrewFinance #WealthStrategy #FinancialWellness Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. Excerpt: In this video, Mark Covell breaks down the new American Airlines Market-Based Cash Balance Plan (MBCBP), a major update that may significantly impact pilots earning over $260,000. ### Should You Hire a Financial Advisor? Should You DIY Your Personal Finances or Hire a Financial Planner? I just returned from the RTAG (Rotary to Airline Group) National convention in Denver this weekend. My initial thought was, “What pilot shortage?!?” I don't know the official attendance, but it was well into the thousands. The lines of people in custom-fit suites for each airline seemed hours long. I enjoyed speaking with all the pilots looking to transition from the military to the airlines, as well as those currently employed in airline jobs seeking to advance to the next level of aviation. And for their sake, I hope the airlines and fractional carriers open the hiring floodgates sooner rather than later! It reminded me how blessed those who currently have their dream airline job are and how fortunate (and old) I am to have had a dream military and airline career already in the rear-view mirror! Fortunately, I attended the RTAG convention to answer financial questions and represent our financial-planning firm for pilots, Leading Edge Financial Planning. During our conversations with pilots, we not only discussed the potential of their next airline job, but also explored their potential future professional pilot journey, the challenges and opportunities of the airline industry, and how to maximize their massive financial potential. One of the most frequently asked questions we addressed during the convention was, “Do I need a financial planner?” Or “Why might I consider working with a financial planner?” Clearly, as the business owner of a financial planning firm that works with pilots, I wanted to knock this question out of the park. However, I always answer this question the same way – “Not everyone needs a financial planner.” There are some DIY investors who do a great job. In fact, I found a few of those at the RTAG convention, and I quickly asked them to come to work with us to help other pilots! Here are a few thoughts and considerations to help you determine whether a financial planner is right for you or whether you should “go it alone.” In my experience, it seems that many professional pilots reach a point in their career where the dollar amounts are larger than they ever anticipated. This adds a sense of heaviness to managing their finances alone. They know that small mistakes with very large numbers are now more significant than they were when they were perhaps a brand-new first officer. This is akin to your first flights in the Cessna 172 versus the 787 Dreamliner with 250 passengers. It’s serious now! On the other hand, personal finance DIYers, unlike flying a Dreamliner, can be successful with the right mindset and aptitude. If someone enjoys reading financial books (watching YouTube/Tik-Tok/Facebook doesn’t count for obvious reasons), keeping up with their airline benefits, IRS changes, and work to understand investment basics, I believe they can be successful. And I’ve met many pilots who are doing just that. It’s impressive! Knowing the nuts and bolts of investing, taxation, and airline benefits is important. However, I think the most essential characteristic of a capable DIY investor is the right mindset. Investing and personal finance can be like sports or other challenging endeavors where the result may have turned out well in the short term, but the execution was poor. For example, my airline buddy tells me about a hot stock tip. I invest in said stock—the price goes through the roof! Voila! We’re both geniuses! In other words, a good DIY investor knows the difference between luck and skill. And they don’t let their ego or their pride mislead them. The more a good DIY investor learns about investing, the humbler they will be.   Finally, DIY investors know that making investment decisions based on gut feelings or emotions is a big no-no. Your gut may work well in other major decisions of your life, but it can work against you in the long-term world of investing. For example, if you’re tempted to buy any investment solely because it’s gone up in price, you may reconsider the DIY path. I believe avoiding the emotional side of investing is the most challenging part of being a DIY investor. Evidently, Vanguard does too. They recently conducted a study called Vanguard Advisor’s Alpha. In the study, they attempted to put a numerical value on the net returns a trusted advisor can add to their client's portfolio. Keep in mind that Vanguard has its own slew of financial advisors, so they’re not completely conflict-free in their study. As you can see in the chart below, “behavioral coaching” adds the most value by far, ranging from 0 to 200 basis points (2%). Recently, one of my favorite Morningstar financial columnists and personal finance guru, Christine Benz, published an article titled “Why I Have a Financial Planner…Even dedicated DIYers might benefit from a second opinion.” In the article, she listed five reasons she found value in the services of a trusted financial planner. We wanted a second opinion on a few important decisions. We found a business model that makes sense for our situation. It gave us impetus to get, and stay, organized. We love having a succession plan. A third party can help give us “permission to spend.”   I encourage you to read her short article. It may also help you decide whether the DIY path is right for you. If you decide you would like to explore the path of finding a trusted professional to partner with, here are a few essential questions to ask during the interview process: How are you compensated for your services? This will make any conflicts of interest immediately crystal clear. For example, “I get paid when you buy an annuity.” Guess what the solution to all your financial challenges will be?   How can you add value commensurate with the fees I pay? Are you getting what you pay for? Oftentimes, clients pay high fees for investment management only. We believe that comprehensive planning services should be integrated with investment management.  What is the personal profile of the typical client you serve? Does the advisor you’re interviewing understand airline benefits and retirement plans? Most advisors do not. What are your conflicts of interest? Most of these questions will be cleared up in question number one. However, this is the advisor’s chance to be honest and forthcoming with potential conflicts. If they say they don’t have any conflicts to disclose, then don’t just walk, run away! What services should I expect? This is important to know so that your expectations are met. If you’re not satisfied with the level of service they offer, don’t feel like it’s because your expectations are too high or unrealistic. What are your professional designations? In my opinion, if an advisor does not have the CFP®, CFA®, or CPA/PFS designation, then you should find someone else. They may be great people, but if you had to put tons of money, time, and effort into your flying ratings, then you should expect the same from the financial professional that you might entrust your life savings to.   Fly safe! Charles Mattingly, MBA, CFP® | CEO & Lead Planner Leading Edge Financial Planning  865-240-2292 Office  865-328-4969 Cell/Text   Please tell us if we can help you on your journey to financial peace and prosperity! Schedule a Time to Chat Read Before Fly Newsletter The Pilot Money Guys Podcast Pilot and High-Income Blog Take the Pilot Wealth Index Quiz Leading Edge YouTube Pilot Money Guys Instagram Submit a Suggestion Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### SWA Open Enrollment Term Life Insurance and GVUL https://www.youtube.com/watch?v=S7J16ySZB8AJoin Kevin Gormley, CFP®, CPA, PFS and Charlie Mattingly, CFP®, MBA from Leading Edge Financial Planning for a discussion on life insurance options available to Southwest Airlines pilots. This video breaks down the differences between term insurance and Group Variable Universal Life (GVUL) insurance options, helping you make informed choices during SWA Open Enrollment 2026. GVUL, or Group Variable Universal Life, is a type of life insurance policy that combines life insurance protection with investment options. It is designed to provide financial protection for the insured while allowing the policyholder to build cash value through investment growth. The less imputed income is due to the fact that the premiums for the policy are covered by the employer, which reduces the taxable income for the employee. This can lead to a lower tax burden for the employee, as the premiums are deducted from their paycheck before taxes are calculated. Additionally, GVUL policies often offer tax-deferred benefits, which can be beneficial for long-term financial plans. Whether you’re a young pilot with kids, a high earner focused on tax efficiency, or someone with potential health issues looking to protect your family’s future, this episode may provide the clarity and confidence you need to choose wisely. Key Topics Covered SWA Life Insurance Open Enrollment Overview Insurance Options for Young Families Regular Plan Life Insurance Options BenefitsPlus Life Insurance Options Group Variable Universal Life (GVUL) Insurance Overview and Medical Exam Requirements Cost Comparison of Term and GVUL Insurance Maximum Coverage and Tax Implications Legal and Disclaimer Information Actionable Takeaways: Review the cost differences between GVUL and term life insurance using the example of a 50-year-old pilot with $500,000 of additional coverage. Understand the insurance options for pilots on the regular health plan. Explore coverage options for those on Benefits Plus health plans, which offer up to 10x annual base pay, capped at $2.95 million. Learn how GVUL insurance options may help some pilots depending on their health insurance plan, the pilot’s health, and their family’s financial planning needs. Life insurance decisions may feel complex, but the right strategy can bring peace of mind for you and your loved ones.   Take time this open enrollment season to align your coverage with your goals, because preparation today may protect your tomorrow.   Connect with Kevin Gormley 📧 kevin@leadingedgeplanning.com  865-217-7779 Connect with Charlie Mattingly 📧 charlie@leadingedgeplanning.com  865-240-2292   Schedule a Time to Chat Read Before Fly Newsletter The Pilot Money Guys Podcast Pilot and High-Income Blog Take the Pilot Wealth Index Quiz Leading Edge YouTube Pilot Money Guys Instagram Submit a Suggestion   #SouthwestLOL #PilotMoneyGuys #LeadingEdgeFinancialPlanning #PilotFinance #PilotLife #SouthwestPilots #LossOfLicense #LongTermDisability #RetirementReady #PilotBenefits #SmartMoneyMoves #PilotFamily #FinancialWellness   Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. Excerpt: Join Kevin Gormley, CFP® and Charlie Mattingly, CFP®, from Leading Edge Financial Planning for a discussion on life insurance options available to Southwest Airlines pilots during SWA Open Enrollment 2026. ### SWA Open Enrollment Loss of License and Long Term Disability https://www.youtube.com/watch?v=ZtRMDPqSMeUIn this video, Jonathan Schultz, BS (Aeronautics) and Charlie Mattingly, CFP®, MBA from Leading Edge Financial Planning break down the key details of Southwest Airlines’ (SWA) Loss of License (LOL) and Long-Term Disability (LTD) benefits for pilots. They explain how these important programs work, including the difference between taxable and non-taxable LOL benefits, how imputed income affects your paycheck, and the distinctions between LTD A and B options. You’ll also gain insight into how these benefits may fit into your overall financial and family protection plan. Whether you’re a new Southwest pilot or preparing for retirement, this discussion may help you make informed choices about your income protection strategy and long-term security. Key Topics Covered Southwest Airlines Loss of License Benefit Overview Taxable vs. Non-Taxable Loss of License Benefit Non-Taxable Loss of License Benefit and Imputed Income Long-Term Disability Options A and B Decision-Making for Long-Term Disability Options Contact Information and Additional Resources Actionable Takeaways: Share this video with fellow Southwest pilots who may benefit from understanding these benefits. For personalized analysis and guidance on your LOL and LTD coverage, reach out to the Leading Edge Financial Planning team: Connect with Charlie Mattingly charlie@leadingedgeplanning.com  865-240-2292 Connect with Jonathan Schultz jonathan@leadingedgeplanning.com  865-684-4622   Understanding how your Loss of License and Long-Term Disability benefits work may make all the difference in protecting your income and peace of mind. As always, the team at Leading Edge Financial Planning is here to help you make confident, informed decisions that support both your flying career and your financial future. Schedule a Time to Chat Read Before Fly Newsletter The Pilot Money Guys Podcast Pilot and High-Income Blog Take the Pilot Wealth Index Quiz Leading Edge YouTube Pilot Money Guys Instagram Submit a Suggestion   #SouthwestLOL #PilotMoneyGuys #LeadingEdgeFinancialPlanning #PilotFinance #PilotLife #SouthwestPilots #LossOfLicense #LongTermDisability #RetirementReady #PilotBenefits #SmartMoneyMoves #PilotFamily #FinancialWellness   Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. Excerpt: In this video, Jonathan Schultz, BS (Aeronautics) and Charlie Mattingly, CFP®, MBA from Leading Edge Financial Planning break down the key details of Southwest Airlines’ Loss of License (LOL) and Long-Term Disability (LTD) benefits for pilots. ### United Airlines 401(k) and HRA/RHA Contributions https://www.youtube.com/watch?v=OLMoRDV1fXQIn this video, Jonathan Schultz, BS (Aeronautics) and Charlie Mattingly, CFP®, MBA from Leading Edge Financial Planning break down the complexities of the United Airlines contributions to the Health Reimbursement Account (HRA) and Retirement Health Account (RHA) for pilots. They explain how funds may flow between these accounts, when contributions happen, and how 2025 IRS limits may impact your overall retirement and healthcare strategy. Whether you’re a pilot who isn’t contributing to your 401 (k) or one who’s already maxing it out, this video may help you make informed decisions to optimize both your healthcare and retirement savings.   Key Topics Covered United Airlines Contributions to 401 (k), HRA and RHA Overview HRA Contribution Details Zero and Maximum 401(k) Contribution Scenarios 415 (c) Excess and 401 (a)(17) Excess Contributions to HRA/RHA   Actionable Takeaways: Understand how United may contribute to your 401 (k) and HRA/RHA if you are not contributing to your 401(k). Review what may happen when you max out your 401(k) contributions. Contact the team at Leading Edge Financial Planning for personalized guidance. Your HRA and RHA may play a bigger role in your long-term financial security than you realize. Understanding how these accounts are funded may help you make smarter decisions today and enjoy more flexibility in retirement. Connect with Charlie Mattingly charlie@leadingedgeplanning.com  865-240-2292 Connect with Jonathan Schultz jonathan@leadingedgeplanning.com  865-684-4622   Schedule a Time to Chat Read Before Fly Newsletter The Pilot Money Guys Podcast Pilot and High-Income Blog Take the Pilot Wealth Index Quiz Leading Edge YouTube Pilot Money Guys Instagram Submit a Suggestion #UnitedHRA #RHA #UnitedPilots #RetirementPlanning #LeadingEdgePlanning #PilotMoneyGuys #PilotFamily #PilotLife #PilotFinance Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### SWA 2026 Open Enrollment Sick Time and Short Term Disability https://www.youtube.com/watch?v=lsz_10zz12sIn the first video of Southwest Airlines’ Fall 2025 Open Enrollment series, Jonathan Schultz, BS (Aeronautics) and Charlie Mattingly, CFP®, MBA from Leading Edge Financial Planning unpack what Southwest pilots need to know about sick time and short-term disability (STD). They explain why one sick trip per month may be important for continuing to accrue both profit sharing and vacation time during a disability. For example, a 40 year old pilot would need 300 sick trips to cover one trip per month from age 40 to 65. The discussion also covers how sick time may help serve as your personal disability bank, the role of emergency funds, and when canceling STD coverage might make sense. Key Topics Covered Southwest Airlines Open Enrollment Introduction Importance of Sick Trips for Accruing Vacation Time and Profit Sharing Details of Short-Term Disability Ideas to Utilize Sick Time and Emergency Funds for Disability Emergencies Actionable Takeaways: Exercise caution when using sick time. Determine how much sick time you may need based on your age and years until retirement to continue to accrue vacation time and profit sharing during a disability. Consider canceling STD coverage if you can cover a disability emergency between your sick time and emergency fund, particularly between ages 60–64.   This conversation may help pilots gain clarity and confidence around open enrollment decisions. Watch, reflect, and share your feedback. We'd love to hear your questions and insights.   Connect with Charlie Mattingly charlie@leadingedgeplanning.com  865-240-2292 Connect with Jonathan Schultz jonathan@leadingedgeplanning.com  865-684-4622   Schedule a Time to Chat Read Before Fly Newsletter The Pilot Money Guys Podcast Pilot and High-Income Blog Take the Pilot Wealth Index Quiz Leading Edge YouTube Pilot Money Guys Instagram Submit a Suggestion   #SWAdisability #PilotFinance #SickTrips #DisabilityCoverage #LeadingEdgePlanning #SouthwestAirlines #AviationMoneyMatters #PilotLife #OpenEnrollment2025 #PilotMoneyGuys    Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. Excerpt: In this video, Jonathan Schultz and Charlie Mattingly, CFP® from Leading Edge Financial Planning unpack what Southwest pilots need to know about sick time and short-term disability (STD). ### Capital Gains Yay! Capital Gains Tax Boo! https://www.youtube.com/watch?v=o_YpXepv7mcIn this video, Kevin Gormley, CFP®, CPA, PFS from Leading Edge Financial Planning unpacks the emotional and financial journey of realizing capital gains. Using a thought experiment with a “benevolent uncle,” he explores the stages investors may go through from excitement to shock to acceptance when they discover how much tax can impact their uncle’s gift. Along the way, Kevin highlights practical strategies that may help investors better prepare themselves to pay taxes on capital gains. Key Topics Covered Introduction to the capital gains dynamic and its emotional impact The three stages investors may experience: euphoria, shock, and acceptance The “benevolent uncle” and the million-dollar gift example Understanding after-tax wealth and the reality of taxes Emotional responses and strategies to cope with capital gains taxes Practical approaches to managing capital gains, including:- 1031 exchanges for real estate- Letting winners run in stock portfolios- Charitable giving with appreciated securities- Step-up in basis at inheritance   Actionable Takeaways: Share your feedback: Did you find the “benevolent uncle” story helpful for understanding capital gains? Consider strategies for managing capital gains, such as 1031 exchanges, letting winners run, or charitable giving.   Taxes on capital gains can feel overwhelming, but with the right mindset and planning, they don’t have to derail your plans for that money.   Connect with Kevin Gormley kevin@leadingedgeplanning.com ☎️ 865-217-7779   Schedule a Time to Chat Read Before Fly Newsletter The Pilot Money Guys Podcast Pilot and High-Income Blog Take the Pilot Wealth Index Quiz Leading Edge YouTube Pilot Money Guys Instagram Submit a Suggestion #CapitalGains #TaxPlanning #WealthStrategy #InvestmentPlanning#FinancialEducation #LeadingEdgePlanning #TaxStrategy #PortfolioManagement #FinancialWellness #PilotFamily #WealthManagement   Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Protect Your Stuff https://www.youtube.com/watch?v=P7ZKIbv3BCg Protect Your Stuff: How to Safeguard Your Wealth From Lawsuit In this video of Protect Your Stuff, Kevin Gormley, CFP®, CPA, PFS, is joined by Cecil Scarbrough, CHO, CIC, CEO and Founder of Ace Insurance Consultants. Cecil brings decades of leadership in the insurance industry, with deep expertise in sales, risk management, and life insurance solutions. Together, they unpack the essentials of safeguarding your wealth through smart insurance planning. From understanding insurable risk to navigating the nuances of home, auto, and umbrella policies, this conversation highlights strategies that may help protect what matters most. Whether you’re a high-net-worth individual, a business owner, or simply someone who wants to avoid costly surprises, you’ll find practical insights you can apply today.Don’t miss this insightful discussion to gain clarity, confidence, and practical steps you may take to strengthen your financial safety net. Key Topics Covered: Understanding Insurable Risk Home Insurance Basics Additional Home Insurance Considerations State-Specific Insurance Costs Auto Insurance and Liability Risks Managing Insurance for Young Drivers Protecting Assets from Lawsuits The Role of Umbrella Insurance Life Insurance for Pilots Contact Information and Conclusion Actionable Takeaways: Research insurance costs and coverage options you may face before moving to a new state Exercise caution when lending vehicles to others, as it may increase your liability risks Review auto insurance coverage carefully, especially for teenage drivers who may carry higher risk Check your homeowner’s policy to determine if it provides actual cash value or replacement cost coverage Evaluate whether an umbrella liability policy may be right for you Connect with Kevin Gormley kevin@leadingedgeplanning.com  ☎️ 865-217-7779 Connect with Cecil Scarbrough, CHO, CIC Ace Insurance Consultants: aceinsuranceconsultants.comcecil@aceinsuranceconsultants.com | riskmanagement@aceinsurannceconsultants.comLinkedIn: https://www.linkedin.com/in/cecil-scarbrough-cho-cic-b38a9372/Facebook: Ace Insurance Consultants☎️ 865-342-7222 📅 Schedule a Time to Chat ✈ Take the Pilot Wealth Index Quiz 📧 Read Before Fly Newsletter 🎦 Leading Edge YouTube 🎤 The Pilot Money Guys Podcast 📷 Pilot Money Guys Instagram 📜 Pilot and High-Income Blog 🗨 Submit a Suggestion #PilotLife #InsuranceStrategy #WealthProtection #UmbrellaPolicy #HomeInsurance #AutoInsurance #PilotFinance #RiskManagement #LeadingEdgePlanning #PilotFamily Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Is an HSA Right For You? Is the High-Deductible, Health Savings Account Medical Plan Right for You and Your Family? For many of you reading, your airline benefits open enrollment period is quickly approaching. You will have many choices during this annual open enrollment and this article addresses one of the most important choices of all; what type of healthcare plan is right for you and your family?  More specifically, we’ll discuss the pros and cons of the high-deductible health plan (HDHP) paired with the Health Savings Account (HSA).  A Health Savings Account is what the name implies: a tax-advantaged savings account used for healthcare expenses. The HSA account is like no other investment account because it is the only one that offers triple tax savings. 1. Contributions to a Health Savings Account (HSA) are tax deductible. For example; If you are in the 24% marginal tax bracket, married filing jointly, and you maximize your HSA annually, your tax savings could be $2,052 ($8,550 x 0.24). 2. You can invest the contributions to your HSA and they grow tax-free similar to a 401 (k) or IRA. Depending on the employer, HSAs typically require a minimum balance of $2,000 before allowing investment of additional funds.  3. When monies are withdrawn for qualified medical expenses, there is no tax due on the distribution.    Note: There could be a 20% penalty and taxes for using the HSA for non-qualified expenses. If you withdraw funds from the HSA after you turn 65, you will not be penalized for non-medical expenses. For example, you could use your HSA to purchase a car at age 65, but you will owe ordinary income taxes, similar to a pre-tax 401 (k)/IRA distribution.  Possible HSA strategy Many people (including myself) plan to use the HSA like a medical 401 (k). Consider saving the maximum annual amount and only withdraw monies for large medical expenses you can’t cover with your regular cash flow. Qualified medical expenses still count towards your annual deductible, whether you used the HSA or out-of-pocket cash to pay the expenses. This strategy allows the most savings, investing and tax deferral to work for you over time.   Log Your Expenses & Save your Receipts! Be sure to save all medical expense receipts regardless of whether you use your HSA or out-of-pocket cash to pay.  Even years later, since the IRS does not impose a time limit, you may reimburse yourself tax-free from your HSA for the qualified medical expenses you paid out-of-pocket. This strategy not only preserves the tax advantages of the account but also creates a reserve of reimbursable expenses that can be tapped in the future. In the event of an unexpected non-medical emergency, you could withdraw funds from your HSA tax-free by matching them to unreimbursed medical receipts. Here is a short list of typical eligible medical expenses that qualify to be paid from the HSA: Prescriptions and medications Dental work Vision care Over-the-counter drugs and medical supplies Preventative care Physical therapy, chiropractic and psychiatric care Medicare premiums Long term care premiums Here is a short list of non-eligible medical expenses: Cosmetic surgery Medical insurance premiums; exceptions noted above Vitamins For a more detailed listing of eligible expenses see IRS Publication 502.  The Numbers: HDHP and HSA Details After enrolling in your airline’s HDHP, your contributions to an HSA are immediately vested and can be made by both you and your employer. Your new HSA is also portable, in case you’re worried about an employer change in the future. The 2025 annual contribution limit is $4,300 if single, $8,550 if married. Individuals age 55 and older may contribute an additional $1,000 annually as a catch-up contribution. Are the HDHP & HSA Right for You? Although HSAs have great tax savings attributes, the most important factor in your decision on whether or not to select a High-Deductible Health Savings Plan is your current medical circumstances. Below are a few factors to consider when determining whether an HDHP and HSA are right for you: Health History If your family’s health circumstances require frequent doctor visits or ongoing treatment, dealing with the higher and consistent out-of-pocket costs for care associated with the HDHP may be too much of a burden on both your finances and peace of mind. Health Care Coverage To contribute to an HSA, the IRS requires that you be exclusively covered by an HDHP. Examples of disqualifying coverage include TRICARE or Medicare. (e.g., if you use TRICARE as primary or backup healthcare, you cannot contribute to an HSA). Important note: For Medicare specifically, there is a lookback period of coverage for 6 months prior to enrolling, meaning you cannot contribute to an HSA for that period of time. VA Medical Benefits You may be temporarily ineligible to contribute to an HSA if you have received Veterans Affairs medical benefits within the past 3 months. Ok, so HSAs are great and could be helpful if they fit with what you need. Fantastic. That said, there are a few important considerations you should be aware of, apart from the bullet points I mentioned above. Paperwork Besides filing the IRS Form 8889 with your tax return, the IRS recommends keeping receipts for medical services and evidence of whether or not you were reimbursed. The lookback period for an audit can extend up to 7 years, so there’s a bit of due diligence that’s required for keeping track of everything. Penalties for Non-Medical Use If you find yourself needing to dip into your HSA for non-medical expenses, you’ll be penalized. On top of income tax being subtracted from the amount you withdraw, the IRS excises a 20% penalty.  HSAs May Be Worth the Effort... or Not! If you’re weighing the decision, remember: HSAs are best used as a long-term strategy. They reward patience, diligent tracking, and the willingness to take on some risk for long-term gain. If the paperwork and potential out-of-pocket expenses seem manageable, and you like the idea of combining retirement planning with tax-advantaged healthcare spending, then opening an HSA this enrollment season may be a smart move. If not, that’s fine too. The best plan is the one that gives you peace of mind and helps you sleep at night. Charles Mattingly, MBA, CFP® | CEO & Lead Planner Leading Edge Financial Planning 865-240-2292 Office 865-328-4969 Cell/Text Please tell us if we can help you on your journey to financial peace and prosperity! 📅 Schedule a Time to Chat ✈ Take the Pilot Wealth Index Quiz 📧 Read Before Fly Newsletter 🎦 Leading Edge YouTube 🎤 The Pilot Money Guys Podcast 📷 Pilot Money Guys Instagram 📜 Pilot and High-Income Blog 🗨 Submit a Suggestion Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Beware If Moving to Low Tax State https://youtu.be/pBBisykUPS8 Thinking of Relocating? Beware If Moving to a Low-Tax State In this video, Kevin Gormley, CFP®, CPA, PFS and Jason Reagan, CFP®, RICP from Leading Edge Financial Planning discuss the growing trend of relocating from high-tax states to low-tax states and the critical risks that come with it. With more people making these moves, states like California and New York are stepping up scrutiny. From proving intent to audit triggers you might not expect, this video explores the legal, financial, and logistical hurdles that could cost you thousands in back taxes and penalties (up to 50% in some cases). They reveal how states are leveraging AI, credit card data, and mobile phone records to challenge residency claims and why updating licenses, estate planning documents, and your overall footprint is essential. If you're a high-income professional considering a move, this is your guide to doing it right. Key Topics Covered: Moving from High to Low Tax States: Introduction and Motivation Patterns of Migration and Tax Revenue Impact Intent and Proof of Domicile Practical Considerations and Potential Pitfalls The Role of Attorneys and the Cost of Audits Final Thoughts and Recommendations Actionable Takeaways: Keep detailed documentation of your residency change Weigh potential tax savings against audit risks and hidden costs Assess whether the move aligns with your overall family and financial strategy Consider consulting an attorney familiar with residency audits in the state you may be leaving Evaluate if tax savings may justify the legal and financial effort of proving true residency Pilots considering a second home in a low-tax state may need legal guidance if planning to claim it as a primary residence Tax authorities are using advanced tech to close gaps, make sure you’re a step ahead. Understanding the rules may help you avoid an expensive audit and preserve your long-term wealth. Resources: 📅 Schedule a Time to Chat ✈ Take the Pilot Wealth Index Quiz 📧 Read Before Fly Newsletter 🎦 Leading Edge YouTube 🎤 The Pilot Money Guys Podcast 📷 Pilot Money Guys Instagram 📜 Pilot and High-Income Blog 🗨 Submit a Suggestion Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Financial Check for Pilots Why Comparing Finances with Peers Can be Misleading: What to Do Instead Pilots are trained to think logically, assess unexpected changes, and make decisions that keep their flight on course to a safe landing. But what happens when you apply this same mindset to your financial life? Is there a reliable benchmark to know if you’re on track for retirement or your other goals? And can comparing your finances to those of your peers really tell you if you are where you should be? To help illustrate this concept, imagine you have a 100-piece puzzle and that you compare just 10 of your pieces to 10 of someone else’s. How accurate can this comparison truly be? Without understanding the full picture of what success looks like and the other components of their financial landscape, you risk arriving at misconceptions at best - or worse, losing your own sense of joy and contentment. The truth is, each pilot’s journey is unique, with layers of complexity that may or may not be revealed during a short cockpit conversation.  Cockpit Confusion: Limited Visibility Picture this hypothetical scenario: you go to work after spending the weekend at a local getaway with the family. Spirits are high, contentment and joy are the name of the game. “Anything exciting lately?” your captain asks. You proceed to tell him all about the great time you had with loved ones, and how fortunate you feel to have had those experiences. Before you can finish, the captain starts talking about plans of traveling to Europe during the summer, shows you a picture of their new car, and brags about closing on their new vacation home. Before you know it, you think: am I falling behind? How can they afford all of this? As the conversation continues, you find out they have significantly more than you in their retirement plans, and slowly but surely you come to the conclusion: yes, I am in fact falling behind. Do any of those thoughts sound familiar? Allow me to introduce you to a different perspective. Although your captain has a much bigger chunk of money in retirement accounts, those funds are all pre-tax while yours are all after tax. They also have a significant amount of consumer and credit card debt, while you are debt free. You also have a significant military pension for retirement and live in a place with a much lower cost of living. Do you see how the more pieces are added to the puzzle, the better you can understand the full picture? In this scenario, you may actually be “ahead” when it comes to finances. And that doesn’t even include other aspects of life, such as your mental and physical health, family, friendships, and sense of purpose.  Turbulence Ahead: The Psychological Trap In addition to the misleading “conclusions” that result from incomplete comparisons, there is another side effect that goes beyond your wallet: your psychological well-being.  A 2022 scientific study published on the National Library of Medicine titled “The Relationship Between Financial Worries and Psychological Distress Among U.S. Adults,” found a “significantly positive association between financial worries and psychological distress.” What may not be as obvious is that the study focused on the subjective aspect of financial concerns - not the objective reality. In other words, a negative perception of your financial status alone, regardless of its accuracy, can negatively affect your mental health and, in turn, many other aspects of your life. You may be thinking, “Fair enough, but if not through comparison, how can I know if I’m where I’m supposed to be financially?” That’s a great question—one with many layers. First, let me offer an abstract answer by quoting one of my favorite authors, John Maxwell, an internationally recognized leadership expert and author with over 19 million books sold. In one of his books, “The 15 Invaluable Laws of Growth,” he writes: “Comparing yourself to others is really just a needless distraction. The only one you should compare yourself to is you.” So how can you apply this idea in the real world of financial planning? Here’s some practical guidance. Define Your Destination Have you ever heard the quote “If you don’t know where you are going, any road will get you there”? I cannot fathom a greater sense of confusion than for a pilot to try to evaluate if their flight is on course if the destination is unknown. So, to answer the question “am I on track?” you must first know… on track for what? For one pilot, “on track” may mean being able to travel with the kids while they are little, contribute to their college education, and have enough free time to enjoy making family memories. For another, it may be retiring at age 55 so they can backpack across the world, experience different cultures, and help financially care for their aging parents. Once your destination is clearly defined, and a timeline and dollar amount are established, it becomes possible to “reverse engineer” those goals and create a plan to achieve them. I personally use the “SMART” method to help make my goals more concrete - it stands for Specific, Measurable, Achievable, Relevant, and Time-bound. Alternatively, the opposite can also be done: if I continue doing what I am currently doing, where will I be in 5, 10, and 15 years? How do I feel about that future reality? Smooth Landing: Arriving Confidently Now that you have the plan that needs to be followed, all that is left is to keep it on track as it weathers different circumstances: do I have enough insurance and the right types? Is my estate plan aligned with my values and wishes? Those are all important questions to consider. At Leading Edge Financial Planning, we understand the unique challenges pilots face. Our team helps aviation professionals build personalized, actionable financial plans, while helping clients clarify their goals, optimize resources, and create a plan for the future. Above all, remember this guiding principle: the best pilots are not the ones who travel at the highest altitude or fly at the fastest speed, but the ones who ensure the plane arrives safely at its destination. All the best! Brenda Hill, B.S.B.A | ParaplannerLeading Edge Financial Planning865-240-2292 Office434-477-9297 Cell/Text Please tell us if we can help you on your journey to financial peace and prosperity! Schedule a Time to Chat Read Before Fly Newsletter The Pilot Money Guys Podcast Pilot and High-Income Blog Take the Pilot Wealth Index Quiz Leading Edge YouTube Pilot Money Guys Instagram Submit a Suggestion Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### What We Can Learn From John D. Rockefeller: A Masterclass in Legacy Building In this video, Kevin Gormley, CFP®, CPA, PFS from Leading Edge Financial Planning breaks down powerful lessons from the Rockefeller family's approach to long-term wealth. John D. Rockefeller, who amassed over $400 billion in today’s dollars, prioritized productive assets like commercial buildings and created the first family office—along with a family constitution to guide future generations. Through strategic investments, philanthropy, and tools like trusts and whole life insurance, the Rockefellers preserved their wealth across six generations. In contrast, the Vanderbilt family lost their fortune by focusing on non-productive assets and poor financial habits. This video explores what made the difference and how pilots and other high income professionals can apply similar principles today. Key topics covered include: John D. Rockefeller's Wealth and Goals Wealth Preservation and Generational Wealth Rockefeller's Financial Strategy and Family Constitution Estate Planning and Charitable Contributions Lessons from the Rockefellers and the Vanderbilts Actionable Takeaways: Prioritizing productive assets may help you focus on investments that generate income and long-term growth. Building a cash flow strategy can help support both your current lifestyle and future legacy. Creating a family financial philosophy may help align values and guide multi-generational decisions. Using tax-efficient tools like Roth strategies, trusts, or permanent life insurance may help protect and preserve wealth. A reminder that lasting wealth comes not just from what you earn, but from how you manage, protect, and pass it on intentionally and with purpose. If that’s the kind of legacy you’re aiming for, this video is for you. 📅 Schedule a Time to Chat ✈ Take the Pilot Wealth Index Quiz 📧 Read Before Fly Newsletter 🎦 Leading Edge YouTube 🎤 The Pilot Money Guys Podcast 📷 Pilot Money Guys Instagram 📜 Pilot and High-Income Blog 🗨 Submit a Suggestion Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Pilots & the 2025 One Big Beautiful Bill: What You Need to Know In this video, Kevin Gormley, CFP®, CPA, PFS from Leading Edge Financial Planning breaks down how the new tax bill may impact pilots at every career stage. Newer first officers may benefit from enhanced child tax credits and expanded state and local tax (SALT) deductions. Captains, particularly those in high-tax states—could see significant advantages, including a $40,000 SALT deduction cap and a 37% top tax bracket, though phase-outs may impact them as well. The bill also includes a $6,000 standard deduction bonus for those over 65 and a $2,200 child tax credit. That said, Senior Captains may be impacted by phase-outs at higher income levels, limiting these benefits. Kevin emphasizes: smart tax planning is key to maximizing what’s available. Key topics covered include: Impact of the New Tax Bill on Pilots Overview of Tax Provisions for Pilots and Business Owners Detailed Analysis of Other Tax Provisions in the One Big Beautiful Bill Impact of Phase-Outs on High-Income Earners Potential Changes to 529s and What is Considered Higher Education Expenses (e.g., Flight School) Standard Deduction Increase, Charitable Deductions and Other Tax Provisions Impact of Tax Provisions on Different Income Levels Actionable takeaways: Conduct a projection for this year’s taxes to determine how the new tax changes may impact you. Consider options for strategies that may help maximize tax savings, such as the use of 529 plans. Research the specifics of the mortgage interest deduction and home equity line of credit interest deduction, which may affect your situation. Educate yourself on the potential benefits and limitations that may arise from the new tax changes, especially the SALT deduction phase-out for higher-income captains. Gain clarity and control over your tax strategy and keep more of what you earn while staying compliant with evolving tax laws. 📅 Schedule a Time to Chat ✈ Take the Pilot Wealth Index Quiz 📧 Read Before Fly Newsletter 🎦 Leading Edge YouTube 🎤 The Pilot Money Guys Podcast 📷 Pilot Money Guys Instagram 📜 Pilot and High-Income Blog 🗨 Submit a Suggestion Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Effectively Utilizing Roth Funding to Prevent a Potential Retirement Income-Tax Bomb! I was working with a client family recently and we took a moment to appreciate the fact that because they started saving in Roth IRAs and Roth 401(k)s at an early age - and accomplished smart Roth conversions along the way - there was a real chance that the vast majority of their retirement income could be tax-free.  Can you imagine it?  Picture yourself in retirement and the only income taxes you may owe are from Social Security income! That would be incredible from a tax savings perspective, not to mention the potential peace of mind knowing that you could be protected from future income tax rate increases regardless of what politicians decide to do.     Granted, this may be considerably more challenging for many folks that are late to the “Roth” game, but there is hope for you and if you’re a young-ish professional pilot, this low-tax environment could be your retirement reality.  First, a little background.  Roth accounts, whether Roth 401k, Roth Thrift Savings Plan, Roth IRA, etc., are all funded with after-tax, non-tax-deductible contributions.  This means the Roth IRA distributions, if all IRS requirements are met, will be tax-free.  So why am I writing about something so simple?  Because there is a price to pay to get money into Roth accounts and it’s not easy to know if, and when the cost is worth it.  To be more specific, the price you pay is oftentimes a forgone tax deduction at your current income tax rate.  Furthermore, accumulating Roth may also mean saving significantly more than you already are in order to take advantage of the back door Roth IRA strategy. Eventually paying income taxes at the highest airline income pay rates becomes so painful most pilots will do almost anything, legal or even borderline legal, to reduce their current taxable income.  This may make sense for some periods of the airline pilot's financial lifecycle.  But eventually if this all-or-nothing-reduce-my-income-taxes-NOW approach is not balance with a reasonable consideration for future taxes in retirement, there may be a “tax bomb” waiting to go off when required minimum distributions (RMDs) kick in at age 73 or 75, depending on birth year. Do your homework, or hire someone that does their homework, to make great decisions to balance the income tax burden now versus the potential retirement income tax bomb.  As we sometimes say, it may be simple, but it’s not easy! Below are six strategies for effectively utilizing Roth accounts and thus working smartly towards the goal of a lower tax liability over the entirety of your life, not just while you're a senior captain at a major airline.  1. A Backdoor Roth IRA conversion is a strategy that allows high-income earners to contribute to a Roth IRA, even if their income exceeds the Roth IRA income limits.  Here's how it works:  First, you contribute to an after-tax, non-deductible traditional IRA, which has no income limits. In other words, anyone can contribute to an after-tax IRA regardless of their income. Second, convert to a Roth IRA: After making the contribution, you convert the funds from the traditional IRA to a Roth IRA. Since you made the traditional IRA contributions with after-tax money (as long as you don’t deduct the contribution), you may pay little to no tax on the conversion if there’s minimal growth between the two steps. The Backdoor Roth IRA strategy is especially useful for those who earn too much to contribute directly to a Roth IRA, but it requires careful planning due to tax implications, especially if you have other traditional IRAs that have any pre-tax contributions. If you currently have a pre-tax rollover IRA from a previous employer’s 401k, you may be able to “roll-in” this pre-tax IRA to your current employer’s 401k retirement plan.  Due to the IRS IRA aggregation rule, rolling in any pre-tax IRAs could potentially clear the path for future after-tax IRA contributions to be converted to your Roth IRA tax-free.  Important reminder:  Any investment gains will be taxable at your marginal income tax rate but not your contributions.  For those interested in learning more about the IRS Roth IRA aggregation rule, please click here.  2. Roth 401k. Unlike Roth IRAs, Roth 401(k)s do not have income limits. So, even if you earn a high income, you can still contribute directly to a Roth 401(k) if it's available through your employer.  The downside to contributing to your Roth 401(k) is that you will potentially forgo a significant income tax deduction and voluntarily choose to pay taxes at your current marginal income tax rate.  There are multiple factors that should be considered when deciding to utilize your Roth 401k.  Here are just a few: Your time horizon. For example, It's almost a no-brainer for a brand new first officer to take advantage of the Roth 401k feature.  It’s a much more personalized and nuanced decision if you are older.  Do you have a military pension?  If so, this may change the amount of your required minimum distributions (RMD) that you actually need for retirement spending.  I can attest that it makes people very angry to have to withdraw from their pre-tax 401(k)s and IRAs and pay taxes whether they need the income or not.  Roth contributions or conversions reduce the RMDs since there are potentially less pre-tax savings.  Your viewpoint on the potential for higher tax rates in the future is important.  Some people feel very strongly that tax rates in the future will be higher than they are now.  Admittedly, no one can be sure what future tax rates will be, but most reliable prognosticators believe they will be higher.  3. After-Tax Contributions to 401(k), aka Mega Backdoor Roth IRA. This is an awesome opportunity to go above and beyond normal Roth savings opportunities.  Here are the steps and variables to consider when evaluating the Mega Backdoor Roth IRA.  First make after-tax contributions to your 401(k) (above the standard pre-tax or Roth contribution limits). Several airlines currently allow this option; including Delta, United, American, FedEx and UPS.  In 2025, the total 401(k) contribution limit (employee + employer + after-tax) is $70,000, not including catch-up contributions.  Once the after-tax contributions are made, you can convert those funds into a Roth 401(k) or roll them over into a Roth IRA. The conversion or rollover happens without triggering taxes on the principal amount (since it was after-tax), but any investment gains will be taxable if you do not move quickly.  The Mega Backdoor Roth allows you to bypass the Roth IRA income limits, giving you a way to contribute much larger amounts to a Roth account. 4. Utilize the tax savings in your airline's Market Based Cash Balance Plan (Delta), HRA/RHA (United), Non-Qualified salary deferral plans (Southwest) to add more to your Roth 401k. For example, if your airline has a retirement plan that accepts 401(k) excess spill cash or allows for salary deferral, consider offsetting the tax savings by contributing a larger portion of your 401k contributions to Roth.  Yes, you could just get the larger tax deduction and go with it. However, the tax savings may allow you to benefit now as well as prepare for potentially higher future income tax rates by saving more Roth.     5. Convert potential inheritance to a Roth IRA. Be sure to consider the tax consequences of potential future inheritances.  We’ve seen several clients recognize that their aging parents are in a much lower income tax bracket than their own. Imagine a scenario where a high-income airline captain in the 32% marginal tax bracket inherits one million dollars from their deceased parents.  Because of the SECURE Act regulations Congress passed in December 2019, the pilot will be required to withdrawal all one million dollars within ten years.  This means Uncle Sam will potentially receive 35%-37% of the inheritance instead of 22%-24% had the parents converted their pre-tax wealth to Roth prior to their deaths. I realize this is slightly morbid planning, but there’s no reason for Uncle Sam to receive ten to fifteen percent more ($100,000 to $150,000 in this example) of your money than they otherwise would have by executing smart tax planning.  6. Consider executing Roth IRA conversions once you retire or during any year (disability) where your income may be significantly lower than your normal airline income.  Clearly, anytime your income is lower, and you convert pre-tax IRA or 401(k) monies to Roth, you will pay a lower tax rate on the conversion.  This is because the taxable portion of the Roth conversion will be taxed at your marginal income tax rate.  Here are some pros and cons for Roth conversions upon retirement, especially if your income is lower than pre-retirement.  Lower Required Minimum Distributions (RMDs): Traditional IRAs require RMDs starting at age 73 (for most retirees). Roth IRAs do not have RMDs during your lifetime. Tax Diversification: Building a pool of tax-free money can give you more control over your tax bracket in later years. As stated before, heirs Benefit: Roth IRAs passed to heirs can grow tax-free, and withdrawals may be more favorable for them. Use caution and be sure to understand that converting too much can push you into a higher tax bracket or increase Medicare premiums (via IRMAA surcharges). Strategic conversions over multiple years (a "conversion ladder") can spread out the tax hit. Ideal time: early retirement (before RMDs and Social Security kicks in), when income may be low. It is best to pay the tax with money outside the IRA to maximize tax-free growth inside the Roth.  Using IRA funds to pay the tax  Hopefully, you found this article interesting and helpful. If you have any questions, contact us at 865-240-2292 or Charlie@leadingedgeplanning.com Fly safe! Charles Mattingly, MBA, CFP® | CEO & Lead Planner Leading Edge Financial Planning865-240-2292 (Office) | 865-328-4969 (Cell/Text) 📧 Charlie@leadingedgeplanning.com Please tell us if we can help you on your journey to financial peace and prosperity! 📅 Schedule a Time to Chat ✈ Take the Pilot Wealth Index Quiz 📧 Read Before Fly Newsletter 🎦 Leading Edge YouTube 🎤 The Pilot Money Guys Podcast 📷 Pilot Money Guys Instagram 📜 Pilot and High-Income Blog 🗨 Submit a Suggestion Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the ### Rich Pilot, Poor Pilot – Mastering Wealth-Building Strategies Kevin, CFP®, CPA, PFS from Leading Edge Financial Planning breaks down the importance of smart asset selection for pilots, highlighting the differences between productive, non-productive, and speculative assets. He explains how assets like stocks, bonds, and rental properties may build wealth, while luxury items may lose value and speculative trends carry risk. With insights like the 26% drop in diamond prices due to lab-grown competition, Kevin emphasizes the value of balanced and strategic asset allocation. Key topics covered include: The three types of assets every pilot should understand How productive assets may grow your wealth—and which ones may not Why luxury items might be costing more than you think The truth about speculative investments like cryptocurrency How successful pilots think differently about money and assets This presentation delivers clear, practical advice to help you: Evaluate your assets to understand which ones may be building or draining your wealth Consider prioritizing productive investments that may generate long-term returns Decide when to limit spending on luxury items that depreciate or require ongoing costs Look at options for building a diversified portfolio of assets that balances risk and reward Whether you're just starting your financial journey or refining your retirement game plan, this episode is designed to help you make smarter money moves that may last a lifetime. 📅 Schedule a Time to Chat ✈ Take the Pilot Wealth Index Quiz 📧 Read Before Fly Newsletter 🎦 Leading Edge YouTube 🎤 The Pilot Money Guys Podcast 📷 Pilot Money Guys Instagram 📜 Pilot and High-Income Blog 🗨 Submit a Suggestion Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### The Secret to True Wealth “You‘ve got to ask yourself one question: Do you feel wealthy?  Well, do ya, punk?”  This is a famous quote from Clint Eastwood in the movie, “Dirty Harry.”  Of course I changed one little word for fun.  Even though airline pilot pay rates are at an all-time high, it still seems like the answer to this question is often a resounding, NO!  More often than not, instead of realizing how wealthy we really are, our focus is more likely on the painful tax bill we recently paid to Uncle Sam. I understand the feeling.  It hurts! On the other hand, what does it mean to be wealthy? What is true wealth?  Is it accumulating as much money as humanly possible?  Some people would initially say, yes.  However, when challenged, we often realize true wealth might also include our health, time with our family and the quality of our relationships as well. Unfortunately, all those values are often in conflict with making as much money as humanly possible.  I spoke to three people within the last week that had life-changing medical diagnoses.  It’s amazing how our perspective, and life, can change so dramatically within minutes.  In each of these individuals' cases their life and their definition of wealth changed very quickly.  In my personal life, I’ve had two major injuries that could have been permanently life-altering, physically.  One of those injuries was with exercise bands.  Please don’t judge, but I’ll admit that during one careless (really dumb) moment, I nearly permanently blinded myself.  The exercise bands were under significant tension and snapped back to hit both of my eyes simultaneously, blinding me for what felt like several hours. I don’t know exactly how long it was because I couldn’t see the clock – this was pre-Siri!    It only took a few seconds after that painful impact to understand where money fit in on my NEW priority list.  My definition of wealth changed instantly!  Don’t get me wrong, I knew money was still a very important necessity (I was an airline pilot at the time), especially if my blindness at that moment turned out to be permanent.  As an example of how our priorities change, the thought I remember focusing on the most at that moment sitting alone in my condo was how goofy I was going to look when I had to touch my daughter’s face to know what she looked like as she grew older.  Isn’t it amazing the amount of detail our minds are capable of during physical and mental stress?  Clearly, prior to my eye injury, appreciating how my daughter would change and grow over the years was not on my priority list.  After remembering my own experience and the recent experiences of my friend’s health diagnoses, my definition of true wealth and even success was put into the proper perspective.  Obviously, we shouldn't need life-altering health experiences to wake us up.  So how do we live with an attitude of true wealth?  Furthermore, how can we feel at peace with our current financial situation, to know that we don’t just feel wealthier but recognize we really are wealthy by every definition?  I believe that through focusing on thankfulness and practicing gratitude we will come to focus more on the wealth we have versus the things that matter a little less, such as the nasty tax bill due on April 15th.  However, this takes real intention and practice.  I continuously challenge myself and so I challenge you to take action on the steps below. It’s not easy.  It takes commitment, time and a little vulnerability.  You may even feel a little silly about some of the techniques for practicing gratitude.  However, the research and evidence are clear that practicing gratitude can increase our feeling of contentment, peace of mind and overall state of wealth.  Check out additional articles and research here, here and here. “This isn’t just a nice sentiment, either. There’s plenty of scientific back-up as to why gratitude is essential to the successful. As this article states, mentally strong people choose to exchange self-pity for gratitude. Doing this will result in things like improved relationships and networking, improved physical health, improved sleep, and improved self-confidence.”  ~Leah Gervais, from the blogpost and website Leahgervais.com/the science of getting rich.  Mindset of Gratitude and Abundance: Our thoughts have a tremendous impact on our lives, both on a conscious and subconscious level. They shape our perceptions of the world around us, influence our emotions, and impact our behavior. In fact, the thoughts we think on a regular basis become ingrained in our subconscious mind, which in turn influences our actions and habits.  Our thoughts translate into words, the way we communicate and express ourselves.  Our words, in turn, influence our actions, the way we behave and react in the world. Questions for you: What is your mindset right now? Are you focusing on what’s missing, or what’s working? What does “enough” mean to you, and how has that changed over time? Do you have a scarcity mindset? o Negative, ungrateful, focusing on limitations, fear of not having enough, or already worrying about the next recession, stock market decline. Ways to Practice Gratitude and Change Your Perception of Wealth: 1. Do the planning work.  What does “enough” look like in financial terms?  Here are a few questions you can ask yourself or your partner to start the planning process: What are your financial goals and savings targets?  What do you want?  Not the things other people say you should want. What is your personal definition of success? Write it down.  Prior to his death in September 2005, former KPMG CEO Eugene O’ Kelly, wrote an inspirational memoir while he was dying of brain cancer called, Chasing Daylight: How My Forthcoming Death Transformed My Life His definition of success became the number of perfect moments he could accumulate before his death.  The book’s summary description on Amazon put it this way: The book’s “...haunting yet extraordinarily hopeful voice reminds us to embrace the fragile, fleeting moments of our lives-the brief time we have with our family, our friends, and even ourselves extraordinarily hopeful voice reminds us to embrace the fragile, fleeting moments of our lives-the brief time we have with our family, our friends, and even ourselves.” 2. Get good at Gratitude:  “When gratitude becomes an essential foundation in our lives, miracles start to appear everywhere.” ~Emmanuel Dagher Make a daily list of things you’re grateful for.  The part of your brain, called the reticular activating system, acts as a selective filter that determines what enters your conscious awareness and influences your overall level of alertness and attention.  After a while, the reticular activating system in the brain starts “looking for” things to put on your gratitude list. An alternative to writing things down is to develop the habit of a gratitude walk, which is simply observing the things around you or saying what you’re thankful for while you’re walking.  Like many other ideas, I stole this one from one of my favorite authors and podcaster, Jon Gordon.  You can see a list of his books here and a link to The Jon Gordan Podcast here.  The gratitude walk has been a challenge to integrate into my daily habit and routine.  To be honest, it felt very awkward and cheesy when I first started - what do I say? Do I say it out loud?  After a while, I made it my own and began to enjoy this ten-to-fifteen-minute daily walk.  After a few weeks of consistent gratitude walks, I found myself enjoying little moments more, being more thankful and it even seemed like the days and weeks slowed down a bit.  I was more aware of the blessings all around me.  (And less aware of what was on the news!) 3. Stop putting the wrong things in! We are great at adapting as human beings. We will adapt to our environment, physically and mentally.  Recently I enjoyed a Ted Talk by Peter Sage titled, “How to Eliminate Self Doubt Forever and the Power of Your Unconscious Mind.”  In his talk, Mr. Sage said, “the two biggest things that impact us unconsciously more than anything else are the mainstream media and the peer group we spend time with...” He went on to say, “Turn off the news!  For those of you who think the mainstream media is about reporting the news, I got news for you, you’re in Disney Land...the job of mainstream media is to stimulate another part of the brain called the amygdala...designed to notice negative before positive” He used an analogy of being in the Amazon rainforest at night. Of all the amazing things going on in the forest at night, “...the news takes your flashlight and points it at a snake eating a rat...but you could choose instead to look at the hummingbird being born.”  What’s important is what’s going on in your world.  Where are you pointing your flashlight?  4. Practice Generosity and Giving.  “Gratitude by definition, is focused on others’ care or on entities outside of oneself. It is not about one’s own accomplishments or luck.” Neurosciencenews.com: “Practicing Gratitude Builds Resilience and Hope” by Monica Y. Bartlett Use your financial resources to give back, whether through charitable donations, supporting loved ones, or acts of kindness. Gratitude for your own abundance naturally fosters a desire to help others, reinforcing a sense of purpose and fulfillment.  An article on NBCnews.com titled, “Money can buy happiness — if you give it away” says it all.  The article discusses “New research reveals that when individuals dole out money for gifts for friends or charitable donations, they get a boost in happiness while those who spend on themselves get no such cheery lift.” Next Steps Look back on what you’ve been through and what you have achieved.  What are the things you wished for when you first started out that now you take for granted? (e.g. three car garage, flying commercially to your vacation destination versus driving, the ability to buy a new car, etc.) When you practice gratitude and thankfulness, you experience life differently and you learn to believe each experience has learning and growth potential.  Further, there’s an abundance of opportunity waiting for you: 1. You bounce back faster from disappointments. 2. You become more psychologically resilient. 3. You’re willing to keep trying because you believe good things are in store for you. I challenge you to try one new mindset habit this week (e.g., gratitude journaling, gratitude walks, gratitude checklist, defining your “enough” number, or sharing abundance with someone else). I believe if you work to build these habits, you will see the ripple effect in your life.  When we notice good things in our lives and in others, we’re more likely to feel content, generous, resilient and truly wealthy.  Give it a shot and let me know how it goes! All the best! Charles Mattingly, MBA, CFP® | CEO & Lead Planner Leading Edge Financial Planning Charlie@leadingedgeplanning.com 865-240-2292 Office 865-328-4969 Cell/Text Please tell us if we can help you on your journey to financial peace and prosperity! 📅 Schedule a Time to Chat ✈ Take the Pilot Wealth Index Quiz 📧 Read Before Fly Newsletter 🎦 Leading Edge YouTube 🎤 The Pilot Money Guys Podcast 📷 Pilot Money Guys Instagram 📜 Pilot and High-Income Blog 🗨 Submit a Suggestion Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### What Is Received Stock Compensation? (ISOs NSOs, RSUs, ESPPs Explained) In this video, Kevin Gormley, CFP®, CPA, PFS and Brenda Hill, B.S.B.A. discuss various types of equity compensation, including incentive stock options (ISOs), non-qualified stock options (NSOs), restricted stock units (RSUs), and employee stock purchase plans (ESPPs). ISOs and NSOs offer the potential for significant gains while also having the risk of becoming worthless. RSUs are actual compensation, taxed as ordinary income when vested, and can be sold or held for either long-term or short-term gains. ESPPs allow employees to buy company stock at a discount, with complex tax rules. The key is to understand these different types of equity compensation in order to manage risk and tax implications, diversify your portfolio, and determine how it may fit into your financial plan. Key Topics Covered: What ISOs, NSOs, RSUs, and ESPPs really are and how they work Tax risks and benefits of different types of equity compensation The importance of understanding vesting, exercising and selling timelines Actionable Tips: Review equity compensation available to you and determine how it may fit into your financial plan Share your equity compensation options with your investment advisor to navigate complex equity compensation options Talk to a tax professional to understand how your equity compensation may impact your taxes Whether you're new to equity compensation or looking to optimize your approach, this video will help you make more informed decisions. 📅 Schedule a Time to Chat ✈ Take the Pilot Wealth Index Quiz 📧 Read Before Fly Newsletter 🎦 Leading Edge YouTube 🎤 The Pilot Money Guys Podcast 📷 Pilot Money Guys Instagram 📜 Pilot and High-Income Blog 🗨 Submit a Suggestion Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Delta Pilots’ Market-Based Cash Balance Plan — Ultimate Financial Strategy Guide Unlock the full potential of Delta’s Market-Based Cash Balance Pension Plan with financial guru Kevin Gormley, CFP®, CPA, PFS. In this in-depth guide, he breaks down ideas how Delta pilots may choose to maximize savings, reduce taxes, and build a secure financial future. You’ll learn how to navigate your retirement planning with confidence, leverage tax deferral strategies, and optimize your investment portfolio for both growth and protection. From automatic savings to smart tax moves, this video simplifies the complexities of the Delta MBCBP into practical, actionable steps. Key topics covered include: Tax-efficient strategies tailored for Delta pilots Managing investment risk with a balanced portfolio Flexible contribution options to boost retirement savings Building a multi-year plan designed specifically for Delta pilots This presentation delivers clear, practical advice to help you: Understand the unique benefits of the Market-Based Cash Balance Plan Create a strategic retirement savings plan Minimize your tax burden effectively Make informed decisions to secure your financial future Don’t miss out on this opportunity to take control of your retirement planning and make your money work harder for you. Watch now and start building the financial future you deserve! Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Man, That Lizard is Loud! Somehow not too long ago, I found myself going down yet another rabbit hole on YouTube. This time I was learning about a water survival technique where SEAL trainees learn to stay afloat with minimal effort while maintaining calm in challenging water conditions, even with their feet bound together and their hands tied together behind their backs. It was fascinating! In fact, I WILL be trying this in my own backyard pool. Some of the comments on the video I was watching were just as interesting as the training itself. Here’s a short sample: “That last couple seconds made my anxiety go through the roof!” “It’s probably easy if you’re relaxed and don’t panic” “I tried to sink in the pool and realized that by holding my breath I was only causing myself to float but by exhaling I was able to sink. It’s crazy how something so simple can be so hard and relies on training your body and mind to be able to do these things consistently while being underwater…” My favorite comment was, “it’s probably easy if you’re relaxed and don’t panic.” Wow. You think so?!? I heard Steven Furtick tell a story the other day on one of my favorite podcasts, The Ed Mylett Show. His daughter had a goal at age seven to swim from one end of the pool to the other underwater. Of course, she wanted to best her older brothers (who have her by two years) by accomplishing this goal. In preparation for the task, like any good father, Steven Furtick told his daughter about the part of her brain that psychologist call the “lizard brain.” The colloquial term “lizard brain,” refers to the brainstem, cerebellum, and basal ganglia, which are responsible for basic survival functions like breathing, balance, and primal instincts, and are often associated with the fight-or-flight response.   After Steven clarified to his daughter that there is not an actual lizard in her brain, he explained that she will probably feel like she is drowning about half-way through the swim test. However, she needs to ignore that feeling. Furthermore, ignore the lizard part of the brain that will tell her things that are not true. And, if she can successfully do those things, she just might make it all the way underwater and beat her two older brothers. She did, in fact, achieve her goal and she made it across the pool underwater. After reaching the other side of the pool, she popped up out of the water and screamed out, “Man, that lizard is loud!” As you probably already know, these two examples perfectly illustrate what is required in times of severe market volatility. All the signs, events, so-called experts around us are seemingly screaming to get out, run away, seek out the quick fix to make this pain stop. Unfortunately, there is no quick fix. There is no information (at this time) to help us get through difficult times in the stock market. The things that work are illustrated in the examples above. Ignore the lizard! Stay calm and stick to what we know has worked in the past. I understand that strategy may sound simplistic and even juvenile to some reading this, but the problem is every other strategy is worse! It reminds me of what Winston Churchill said about democracy. “…Indeed, it has been said that democracy is the worst form of Government except for all those other forms that have been tried…” Here’s the good news: We don’t have to know the future to be successful. However, we do need a plan. If you know how the Navy SEAL trainees that came before you were successful at drownproofing, then you can apply the same lessons and strategy. It’s all you have. Even though the YouTube comment from Captain Obvious nailed it – drownproofing is probably easy if you don’t panic. It certainly must feel more like the first YouTube commenter that said “…last couple seconds made my anxiety go through the roof!” In addition to developing a plan to be successful in a world full of unknowns, we actually need a little faith to go along with the plan. The kind of faith I’m talking about is the faith that it takes to turn down the volume and ignore the voice of the lizard brain. How do we know we won’t drown during the test? How do I know I can swim across the pool underwater and still be okay? There are no guarantees in life, especially when it comes to finances. There is no guarantee that we’ll be here tomorrow. We don’t have guarantees but what we do have is data and experience from the past. The statistics and historical data show that most people lose more money in complex timing strategies aimed at perfectly avoiding the downturns in the markets versus the actual downturns themselves. Check out this article and this one too. And click here to visit PersonalFinanceClub.com to play the “Time the Market Game.” I’m fortunate to have the opportunity to study historical market data on almost a daily basis. I also love studying human behavior. So, the faith that I’m talking about is not a blind faith. It’s the belief that this, too, shall pass. It’s the belief that we are a resilient and creative society. It’s the faith that companies like Apple, Amazon, Microsoft, Meta, and thousands of other companies like them will find a way to not only survive but thrive for decades to come. Furthermore, I benefit from their remarkable ingenuity, growth, and ability to adapt to diverse economic environments. This time one month ago, I was writing for the April issue of Aero Crew News. That article was a bit tongue in cheek. Now it feels very serious. The most recent two days in the market were the worst since 2020. In last month’s article, I mentioned the importance of ignoring headlines and prognosticators. Now, it feels like the events in the markets are aligning with the headlines. This is the most difficult part of the investing journey, where it gets really hard to turn down the volume on our lizard brains. I don’t know what the economy or stock market will be like by the time this article is published in a few weeks. Everything could be on the upswing, or we could be in a deeper market decline. We’re already in correction territory. As of this writing the S&P 500 is down more than ten percent. However, I think this is a great time to revisit investing and finance lessons learned from the past. The kind of lessons our grandparents taught us; save for a rainy day, spend within your means, plan for the future, be generous and grateful!  For those who have a well-thought-out plan and a strong “why” behind your savings and investing strategy, you will be fine. For those who may have been chasing high returns in the “Magnificent 7” and living on the razor’s edge of spending and debt, this could be a painful time. But it’s never too late to revisit lessons learned and develop a plan for success. I’ll wrap up this article by sharing some of the thoughts I recorded during February, March and April of 2020. During the market and COVID-19 chaos I took notes on what it felt like, what we could be doing to help and just simple observations in general. It was certainly a fascinating time that can provide lessons learned for any market downturn if we can just remember them. My Notes and Comments from February, March and April 2020 “Years of stock market gains and past performance can evaporate in days, even hours…” “Southwest Airlines, LUV stock which had outperformed the S&P 500 for almost 15 years…up until this month. Jan/Feb 2020. Now it hasn’t even outperformed a government bond fund for 5 years. Investors are trying to capitalize on the new normal of using Zoom for business meetings, working from home and even schools. Unfortunately, they picked the wrong Zoom company to invest in: “In any case, the rise of Zoom Technologies is making someone money. The defunct company’s total market value is more than $16 million, not too shabby for a company that hasn’t reported revenue since 2011.” What are we learning now? Assuming you know something to be absolutely true could be…faulty planning. We always need to be prepared for multiple outcomes… “It gets better quickly…” “It gets better in ‘?’ years…”   How do we prepare for both of those simultaneously? Diversification, bonds, cash. Strong PERSONAL balance sheets… just like a business. In 2020, it seemed like we all became a lot more introspective… for a minute. Ask yourself questions:   What would my life be like if I had unlimited amounts of money? What would my life be like if I had very little money?   What REALLY brings joy, peace, and contentment? Why didn’t we sell early on in this crisis and go to cash? As each day progressed, we didn’t and still don’t know if it’s early or not. March 20, 2020… There’s no indication that it’s “early” in the stock market decline or “late.” Many days when thinking about what to do with investments the stock market was up 5% or even 10% in a single day.   I inserted this comment on April 10, 2020: so far, the S&P bottomed on March 23rd and is up about 20% since that day. Everyone is calling the bottom every time the market goes up. Simultaneously everyone is saying it WILL get much worse all the time Moving money to cash during a crisis actually creates more fear, stress and potentially regret. (Missed opportunities.) The psychology of holding cash is powerful…once you go to cash it’s hard to invest in the good times because the market is high, and it's hard to invest once the market goes lower because of fear. Now is the time to remember the feeling of wishing you had a stronger personal balance sheet. “Save for a rainy day.” Charles Mattingly, MBA, CFP® | CEO & Lead Planner Leading Edge Financial Planning Charlie@leadingedgeplanning.com 865-240-2292 Office 865-328-4969 Cell/Text Please tell us if we can help you on your journey to financial peace and prosperity! Click here to sign up for our newsletter or click here to schedule some time to chat about your circumstances in more detail. Also, check out our Pilot Money Guys podcast where we regularly discuss these types of financial topics along with some fun airline news updates and interesting guest interviews. Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Tariffs, Layoffs, Negative GDP, oh my! Tariffs, Layoffs, Negative GDP, oh my! It’s shaping up to be a fascinating year in the markets already!  New president and administration, government layoffs, airline layoffs (SWA), tariffs roiling the US markets and so on. So, what should you do?  How might you invest right now to make sure you’re going to be okay whether you are a brand-new first officer or you’re preparing for retirement this year?  We’ll get to this in a moment, but first... A client and friend of mine texted me the other day: “A retired banker is running around saying market is getting ready for a correction bigger than 2008.  Because of tariffs and the new global economy.  What should we do?”   Here are a few other headlines that are sure to get your attention: Ray Dalio, billionaire and founder of Bridgewater Associates hedge fund, predicts a US debt crisis “Heart Attack” within three years ○ https://awealthofcommonsense.com/2025/03/predicting-a-financial-crisis/ From the Federal Reserve Bank of Atlanta: ○ The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2025 is -2.8 percent on March 3, down from -1.5 percent on February 28. After this morning’s releases from the US Census Bureau and the Institute for Supply Management, the Nowcast of first-quarter real personal consumption expenditures growth and real private fixed investment growth fell from 1.3 percent and 3.5 percent, respectively, to 0.0 percent and 0.1 percent. ○ https://www.atlantafed.org/cqer/research/gdpnow ○ Many of you may know that one of the many criteria for a recession is two consecutive quarters of negative GDP. It appears that we’ll have at least one quarter of negative GDP by the time you read this article. Chief Economist at Redfin, Author and former Academic Advisory Council Member of the Federal Reserve Bank of Dallas, Daryl Fairweather, PhD recently posted the following on X (formerly Twitter): ○ “Unless we all wake up from this collective tariffs nightmare, the reality is recession. Recession with inflation which is called stagflation. It’s the worst kind of recession, because people lose their jobs and prices stay high along with interest rates.” At the beginning of every year and at every point in time within the year there are scary headlines and many people making forecasts that make you want to remove your money from the stock market and get off this crazy roller coaster ride called investing. There will always be headlines, events, or forecasts that might make you hesitant to invest.  I know that’s a lot of double negatives but it’s true.  To quote Daryl Fairweather, PhD again she says this about forecasting: “What most people get wrong about forecasting: The thing that almost no one understands about forecasting is that almost all forecast models are unfalsifiable.  So that means that if I say there is a 10% chance that it’s going to rain tomorrow and it doesn’t rain, you can’t prove whether or not I was wrong. If it does rain, you can’t prove whether or not I was wrong, because I said there was at least some probability that it would rain or not rain. And that’s how almost all economic forecasting works...” Let’s continue with the weather forecasting theme.  Warren Buffett said he hasn’t read an economic or market forecast in over 25 years. “There is no value, they only make weatherman look good.” Now back to the focus of this article, what does this mean for you and what should you do about it? Here are a few (less-than-ideal) options: 1. Invest in what did the best last year.  The S&P 500 was up almost 25%!  Surely that would work going forward. 2. We could look to the retired banker or other prognosticators for advice and simply do what they say. There are some really smart people out there shouting Armageddon from the rooftops already.  It seems like if we just did what they said, we’d be okay. 3. Why not just ask Google, Siri or even ChatGPT?  Those sources will consolidate all the loudest voices - I mean, best advice. What makes investing so hard is that we have no idea what the impacts of tariffs will be.  We have no idea if the investment that did well last year will continue to outperform all other areas of the global market.  And we have no idea what a retired banker means when he says, “the new global economy.”  In fact, the banker doesn’t know either, but it sounds smart. I’m not sure who gets the credit, but one of my favorite quotes in investing is, “the best investors in the world must be prepared for multiple outcomes.”  In other words, nobody can accurately predict the future.  Therefore, we have to invest in multiple strategies at once.  Some investing strategies may do really well depending on how the unknowable future plays out and other strategies or investments may do poorly.  We only know which ones will thrive in hindsight. Below are three steps to ensure that you are a successful investor whether you are a brand-new first officer, or you are on the cusp of airline retirement. 1. I always feel like recommending diversification is such a disappointing strategy. I just assume everyone is tired of hearing about it. Plus, it’s really not a fun way to invest. In fact, my second favorite investing quote is, “you know you’re properly diversified when you want to throw up!” Even though you may want to throw up, or fire your advisor, diversification is what allows us to prepare for multiple unknown outcomes at once. Last year the S&P 500 returned nearly 25% and a growth-focused index fund almost returned 35%. It’s very tempting to try to invest in yesterday’s returns. In fact, some experts call this, “investing in the rear-view mirror.” I will never criticize any of those strategies because they might work for you. We’ll only know in the rear view! Interestingly, both investments I mentioned above are in negative territory as of the writing of this article (early March) and an international index fund is one of the better performing investments so far this year with a year-to-date return of approximately 10%. (Schwab International Equity Index Fund) 2. Maintain focus on your investment game plan and do not use headlines, forecasts or your google feed to influence your investing decisions. It sounds obvious but this is really hard. We are bombarded by social media influencers, experts on the news, and even political influences that make us want to change what we’re doing. In fact, this influence is happening without us even knowing it. It’s almost impossible to turn off the noise. The best thing we can hope to do is acknowledge the noise and treat it as entertainment if you enjoy that sort of content. Can you imagine if you acted on or followed the advice of these article headlines? The screenshots below are from MarketWatch.com. March 2014. “New doomsday poll: 99.9% risk of crash in 2014” There were some scary events going on for sure in 2014. Interesting to see the Russia, Ukraine war was brewing long before 2022. And they made a movie about the headline in the bottom left! The second MarketWatch headline screenshot is from a few months later in July 2014. John Hussman is a highly respected economist and head of Hussman Strategic Advisors. By the way, the S&P 500 returned nearly 14% in 2014! Click the image above to open a larger view Click the image above to open a larger view   Neither John Hussman nor Paul B. Farrell lost any money from writing those articles for MarketWatch in 2014. Both are still in the business of writing books and managing investments.  However, if you took action based on their articles, you could have lost a significant amount of your retirement nest egg.   3. Understand the quality of your information, where it comes from and use extreme caution for the Confirmation bias. Here’s a definition of Confirmation Bias from Britannica.com: Confirmation bias; people’s tendency to process information by looking for, or interpreting, information that is consistent with their existing beliefs. This biased approach to decision making is largely unintentional, and it results in a person ignoring information that is inconsistent with their beliefs. These beliefs can include a person’s expectations in a given situation and their predictions about a particular outcome. People are especially likely to process information to support their own beliefs when an issue is highly important or self-relevant. My Google and YouTube feeds are filled with financial articles, sports scores and headlines. Google and Meta design algorithms to keep me scrolling through Google and using YouTube as a go-to source of information or even stalking my friends on Instagram. And I kind of like it! (Full disclosure, I’m not on Instagram and I know nothing about it. So, I’m not actually sure you can stalk your friends on Instagram!) There’s nothing inherently wrong with these algorithms because Google wants to get the content in front of me that I like to click on the most. This is how they get their advertisements in front of me so they can get paid by their customers. However, just type this in your google search if you want to learn why you should use caution and how those algorithms might feed your confirmation bias: “do Facebook and Instagram have algorithms that promote confirmation bias?” Here’s one sample from SkillFloor.com’s article “Impact of Social Media Algorithms on User Behavior”: “Social Media Algorithms tend to show you content that aligns with your existing beliefs and opinions. While this can be comforting, it also creates echo chambers where you only see one side of an argument. This confirmation bias can lead to a skewed perception of reality and hinder critical thinking.” I believe that if you work these three principles into your investing philosophy it will go a long way towards ensuring a successful investing experience regardless of where you are on your investment and professional pilot journey. In summary, it takes a lot of discipline to maintain your portfolio diversification. Do not listen to predictions or forecasts, regardless of the source. There are studies that show you may be better off flipping a coin to predict the future of economic and financial markets. And finally, use extreme caution and discretion about the source of your financial information – it's everywhere and most of it doesn’t apply to your financial situation! Charles Mattingly, MBA, CFP® | CEO & Lead Planner Leading Edge Financial Planning Charlie@leadingedgeplanning.com 865-240-2292 Office 865-328-4969 Cell/Text Please tell us if we can help you on your journey to financial peace and prosperity! Click here to sign up for our newsletter or click here to schedule some time to chat about your circumstances in more detail. Also, check out our Pilot Money Guys podcast where we regularly discuss these types of financial topics along with some fun airline news updates and interesting guest interviews. Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### The Opportunity of a Lifetime: New Pilots are Making More Income than Ever Before! The Opportunity of a Lifetime: New Pilots are Making More Income than Ever Before! What an amazing time to be a professional pilot! You have literally won the lottery! I’ll never forget hearing this statement on my first day of new-hire training at my previous airline. In fact, it’s truer now than it’s ever been. After the recent round of new contracts at most major and fractional airlines, professional pilots now have more income-producing power than medical doctors, according to a recent article in Flying Magazine. “According to the U.S. Bureau of Labor Statistics, the median annual wage for airline pilots is around $202,180. Medical doctors came in with a salary of $208,000, lawyers $127,990, and engineers with a median annual wage of $79,840. To be a doctor, lawyer, or engineer, you can expect to pay for several years of college—and possibly a master’s degree. For doctors, add in years of residency. Professional pilots, on the other hand, have a much shorter path between the 'learn' to the 'earn' phase.” Now that I'm not flying anymore, it’s such a privilege to be able to help young pilots take advantage of this financial opportunity of a lifetime. Of course, it’s easy for me to observe and bloviate about this opportunity now that I’m an old dude looking at it from the outside-in. However, you, the professional pilot, have the challenging task of not squandering this opportunity. It would be easy to do! In fact, many of you have reached out with that exact request - “We don’t want to mess this up!” So, let’s dive in and discuss some sure-fire ways to not screw this up! Life happens, be ready... One of the first lessons is to never forget you are in one of the most volatile industries in the world. I’ll never forget in January of 2020 I may have said these exact words: “It appears the airlines are finally past the days of instability, bankruptcy, and furloughs.” I know, I should choke myself for saying something so stupid. About three months later one of our pilots (evidently “in the know”) informed me that all major airlines would need to file for bankruptcy in 90 days if the government didn’t intervene soon. Never, never forget that anything is possible in this crazy business. It seems to me that whatever worldwide calamity may happen, the airlines are the first to suffer and the last to recover. (See 9/11, energy crisis, war, pandemics, etc.) Whether this is true or not may be irrelevant, however, we should always behave as if it is fact! Since many of you reading this article were dramatically affected by the COVID-19 pandemic, this lesson may be a silver lining to the unimaginable year of 2020. If you can avoid what I call the short-memory syndrome, you may have the fortitude to financially prepare for the next potential airline catastrophe that threatens your livelihood. In addition to industry volatility, professional pilots must be ready for the day when they walk into the flight doc’s office as a bad-ass airline pilot with the world at their fingertips, and then walk out of the office with a revoked FAA medical due to some unforeseen medical condition. It can and has happened that quickly to many pilots. And it will happen to many more. Unfortunately, one of the major deficiencies to a highly confident professional pilot is the hazardous attitude of, “it won’t happen to me.” It did happen to me! However, I was lucky. Like many pilots that are disabled, I was able to return to the cockpit after several months. If you read last month’s Aero Crew News article, you’ll hear from our very own Leading Edge advisor, Jonathan Schultz, where he tells his personal story and lessons learned from walking out of the flight doc’s office one day to never fly airplanes again. He’s had to adjust his entire life at the ripe old age of 28. Luckily for us at Leading Edge Financial Planning, he has a passion for sharing his story with other pilots so that they can be more financially prepared for this possibility than he was. So, hopefully at this point I’ve scared you sufficiently to motivate you to take the appropriate action. Below are a few tasks to tackle immediately to make sure you’re ready for the scenarios we discussed above. Quite frankly, I feel like a broken record when I list these tasks because I know you’ve heard them many times before. It’s akin to telling someone to eat right and exercise. Totally true and a very simple strategy, but very challenging to execute consistently. I want to encourage you to start now and start small. The positive results from these simple action steps will have a compounding effect over time and they will result in significant wealth building by the time you’re a senior captain. Soon you’ll be telling other new pilots about these simple axioms as well. 1. Establish a spending plan - yes, a budget! You must work now to establish good money habits that will last throughout your airline career. One of my favorite sayings is; “choose your hard.” You can work hard now to build an emergency fund, establish a disciplined spending plan, and avoid unproductive debt or you can deal with the stress of years of overspending, living paycheck-to-paycheck, and the effects of poor financial decisions on your personal relationships. And no, I’m not using hyperbole to motivate you. These are real problems that are not uncommon with high-income professionals of any industry, not just professional pilots.  2. You make a great income...BUT you don’t make THAT much. I understand the feeling of... “I work hard and make lots of money so I should be able to buy whatever I want... I deserve it!” This is a false narrative that we should never tell ourselves. This is also a quick way to destroy your wealth building power. There are some income levels where you literally cannot outspend your income. Additionally, there are income levels where budgeting (or at least good spending habits), are not required anymore. I would argue that that is not true for young professional airline pilots. Please be on guard for this type of mindset. You do make a great income, and you can build generational wealth. However, if you are a new first officer and you buy your captain’s home and that ninety-thousand-dollar truck, then you don’t make enough money anymore. It’s gone! 3. Warning: do not try to get-rich-quick with complexity – seek simplicity and disciplined processes instead. For some reason, it is human nature for successful, smart professionals to seek out complex solutions instead of embracing simple truths that have stood the test of time. This is known as the complexity bias and marketing firms take advantage of this all the time: Marketers take advantage of this bias by adding confusing language or meaningless details to product descriptions. Shampoo with protein-enriched vitamins or calcium-infused milk are two examples of making a product seem more sophisticated, fancy, or worth more dough. I’m guilty of doing this too when I used invented language to market products that we thought would sell better if they had fancy technology language attached to them. From the article from themarketingsage.com: Why Do People Have a Complexity Bias? Jeff Slater, November 9, 2021. This same complexity bias leads some smart, high-achieving people to believe they can solve the unsolvable problem of becoming wealthy over time. In other words, “I can shortcut this process if I just find the complex solution that nobody else has been able to find.” Not only do marketers use this bias to sell their products, but financial services companies will develop a product so complex that even their own salespeople don’t know how it works. Some examples include: most annuities, options and currency trading, cryptocurrency (that’s right nobody truly understands it), life insurance that also serves as a college or retirement plan, etc. I think the antithesis of the get-rich-quick attitude is an attitude of abundance. There is a great story from the book as told in Morgan Housel’s book, The Psychology of Money where Warren Buffett talks about the third partner, in addition to Charlie Munger, in their early days: “Do you recognize the name Rick Guerin? Probably not...Warren Buffett and Charlie Munger had a third partner at one time. Rick was that partner. He had a wonderful investing track record on his own...What happened to Rick? He was in a hurry to get rich. He invested using leverage. During the bear market in the 70s, Rick suffered margin calls. Many of the Berkshire shares that Warren Buffett still owns once belonged to Rick.” Buffett went on to say, “Charlie and I always knew that we would become incredibly wealthy. We were not in a hurry to get wealthy as we knew it would happen. Rick was just as smart as us, but he was in a hurry.” Strongly consider saving in your Roth 401k, back door Roth IRA, mega back door Roth 401k for as long as you can stand it. Each year during tax time, high-income pilots have an adverse reaction to paying their astronomical income tax bill. The good news is that you have a high tax bill because you make a lot of money. The bad news is that it will only get worse... or better, depending on if you believed the first part of this sentence. So, what can you do about it? It may sound counterintuitive, you may consider prepaying your taxes now because as a young airline pilot you’ll probably make more money forever more, including in retirement. Therefore, your current tax rate may be the lowest of your lifetime. This is probably not the case for senior captains, but it does make the Roth versus pre-tax decision a little easier for younger pilots. Furthermore, due to the power of compound interest and the time value of money, the money you invest in your twenties and thirties makes up the majority of your wealth after age 65. From the VisualCapitalist: “The Benefits of Investing Early in Life.” “...For example, let’s say you started investing at 20 years old, and you invest $250 each month with an 8% annual rate of return. By the time you reach 65, over 50% of your total portfolio would have come from money that you invested in your 20s.” With these two ideas in mind, a professional pilot early in their career can conceivably get to retirement with the majority of their investment portfolio tax-free. Additionally, once you retire from your airline, you will probably have more opportunities to convert pre-tax dollars to Roth at lower tax rates. Can you imagine what retirement would be like if the majority of your assets were tax-free? That would be incredible! However, achieving this result takes planning and discipline right now. Perhaps, the most obvious strategy might be to avoid the pain of taxes at all costs, legally of course! However, this reaction to the pain of high taxes might cause you to pay more taxes over your total lifetime. Clearly, the Roth versus pre-tax decision can be a technical discussion that requires the consultation of tax professionals. However, there are also many other non-mathematical reasons to potentially pay the tax bill up front for the potential benefit of tax-free income in the future. Finally, as your tax bill increases throughout your airline career, do not give in to the impulse to do whatever it takes to reduce your tax bill. This emotional reaction often results in paying less tax at the expense of reducing your overall net worth. For example; money-losing side gigs to reduce your airline income. For more information about Roth versus pre-tax 401k contributions, back door Roth IRAs and more, refer to the Pilot Money Guys podcast: Flight #76: To Roth or Not to Roth? This article is discussed more in-depth on the Pilot Money Guys podcast: Flight #97: Building Financial Success for Young Professionals. Charles Mattingly, MBA, CFP® | CEO & Lead Planner Leading Edge Financial Planning Charlie@leadingedgeplanning.com 865-240-2292 Office 865-328-4969 Cell/Text Please tell us if we can help you on your journey to financial peace and prosperity! Click here to sign up for our newsletter or click here to schedule some time to chat about your circumstances in more detail. Also, check out our Pilot Money Guys podcast where we regularly discuss these types of financial topics along with some fun airline news updates and interesting guest interviews. Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Taxation on Real Estate Investing   In this video, Kevin Gormley, CPA, CFP® from Leading Edge Financial Planning dives into the tax implications of real estate investing. Learn about the benefits and limitations of real estate taxation, including concepts like depreciation shields, real estate losses, and 1031 exchanges. Kevin explains how real estate taxes apply to rental income, but may not directly reduce your W-2 income taxes. Discover strategies like loss harvesting, the short-term rental loophole, and how depreciation can create "phantom expenses" that lower taxable rental income. Kevin also covers key topics like: • Depreciation recapture when selling real estate• 1031 exchanges for deferring taxes on capital gains• Self-directed IRAs and LLCs in real estate investing If you’re a real estate investor or pilot looking to understand real estate taxation, this video is packed with insights to help you build wealth and plan effectively. If you find our videos helpful please give us a "Thumbs Up" and be sure to SUBSCRIBE to our channel to be notified as more videos become available. Contact us at 865-240-2292, or visit our website to learn more about our financial planning services, https://leadingedgeplanning.com/  Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Inheriting Money: IRS Rules You Need to Know     In this video, Kevin Gormley and Travis Reader, both CERTIFIED FINANCIAL PLANNERs® from Leading Edge Financial Planning, dive into what you need to consider when you inherit money. Whether it's a taxable brokerage, IRA, or Roth IRA, understanding the tax implications and required distributions is crucial. Kevin and Travis explain the three most common types of accounts you may inherit and walk you through the key steps to take when you're a beneficiary. From determining the account type to understanding designations like eligible or non-eligible beneficiaries, they simplify what can be a complex process. Kevin and Travis also discuss important terms like RMD (Required Minimum Distribution) and RBD (Required Beginning Date), and share strategies for handling inherited accounts based on your relationship to the deceased. This video is a must-watch if you're dealing with an inherited account and want to ensure you're making the best decisions for your financial future. Watch now to learn: ○ The 3 most common types of inherited accounts: taxable, IRA, and Roth IRA. ○ What it means to be an eligible or non-eligible beneficiary. ○ Options to handle manage required distributions and tax considerations. ○ Key insights on how to minimize taxes and maximize the potential of your inheritance. Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### The Three Bucket Approach: Securing Your Retirement Income In this video, Kevin from Leading Edge Financial Planning breaks down the Three Bucket Approach — a retirement portfolio strategy as vital as oxygen for financial peace in retirement. He explains the importance of each bucket: a cash bucket for immediate expenses, a conservative bucket for steady income in the medium-term, and a growth bucket to guard against inflation and maintain purchasing power. Discover how this method can bring security and peace of mind, along with ideas to consider for managing your retirement portfolio using this approach. Kevin also discusses some pros and cons about the three bucket approach retirement strategy and offers insights on how to visualize these buckets to achieve peace of mind in retirement. If you're planning for retirement or just want to understand how to make your income last, this video is a must-watch. Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions ### Plan and Prepare for the Unexpected: My Personal Lessons Learned from Hurricane Helene As I write this article it was almost exactly one week ago that I drove through the night to pick up my daughter from Furman University in Greenville, SC. The evening before I left, my daughter and I chatted about her driving home from school since there was no power, and very little access to food or fuel.Even after that conversation I wasn’t quite sure of the extent of the damage from Hurricane Helene in the western Carolinas. My daughter mentioned that she was going to make her way to a friend's house or a hotel in the Greenville area. However, the power was out at both places. There was literally nowhere to go to get food, water, or electricity. After that conversation, I realized my daughter wanted out of there and she might be crazy enough, like her dad, to start driving just to make something happen. I really wanted to get there before she decided to leave for home that Saturday morning. That is what really motivated me to get up at 2 AM and start my four-hour trip from Maryville, TN, to Greenville, SC. Interstate 40 from Tennessee to North Carolina had washed away in the flooding, so I took a famous path of mountainous roads called the Tail of the Dragon, aka Highway 129. I’m sure that stretch of highway is exciting under different circumstances and with a different vehicle than my Toyota 4-Runner!I still didn’t know the full extent of the damage, but I knew there was a possibility of flooded roads, downed trees, closed roads, areas of no cell service and limited gas at gas stations. In fact, all of these conditions existed and more! The damage, especially to the Ashville, NC, area was far worse than I thought. Even now, the death toll is still rising, and there are ongoing search and rescue operations for missing individuals that live in remote and mountainous areas. After witnessing a small portion of the damage from Hurricane Helene, I’ve apologized to my Florida and other coastal living friends for my lack of empathy and understanding of the true devastation Hurricanes can inflict on communities and human lives. I’ve often read that knowing something to be true and having the experiential knowledge of that something is vastly different. I came to experience that principle firsthand after the short rescue operation of my daughter from college. Clearly, what I witnessed was just a fraction of what was happening to those who live in the areas affected by Hurricane Helene. Get a Plan and Change Your MindsetWhat are some steps we can take to prepare for a catastrophic event of any kind? Catastrophic events happen in many different forms; disability, untimely death, loss of employment (see the latest news for Spirit Airlines). However, just like flight planning, having a plan in place for the unexpected can bring security, confidence, and reduced stress, but we must do the work. The most important part of any plan is to have the right mindset. I’ve certainly been guilty of a mindset of, “...that (hurricane, earthquake, tornado, etc.) only happens to other people and it won’t happen to me.” Furthermore, put aside the idea that you’ll be labeled a crazy prepper if you have a generator and fuel source in your basement. Get one asap!As we have already discussed in this article, we don’t know what the next event will look like. We do know it will look very different from what we experienced in the past – remember 2020? Also, like you, I’m a bit skeptical of the electromagnetic pulse (EMP) grenade that your captain told you was going to happen soon, but you’ll be prepared for it anyway!Create a “Go Bag”One of our Leading Edge team members, Amelie, shared with us a time when they lived in an area in California prone to wildfires. She mentioned that they prepared a couple of duffel bags they could grab quickly and run out the door to escape the fires. The bags might contain the items below, but you may decide to include other items as necessary for your area. Click here to get more ideas from the California Department of Forestry and Fire Protection. • Cash! – more on that below• Short supply of non-perishable food and water• Maps with evacuation routes. (Like mine, your cell phone may not be the latest and greatest that still provides GPS directions without a Wi-Fi or cell phone signal.)○ I learned after my trip that the iPhone 16 has satellite connectivity features that allow you to send and receive messages, request roadside assistance, and share your location when you don't have cellular or Wi-Fi coverage – That would have been nice!• Necessary prescriptions or medications• First aid kit and sanitation supplies• Flashlight and battery-powered radio with extra batteries• Copies of important documents; birth certificates, passports, etc****Another one of our Leading Edge advisors, Mark, currently living in Asheville, said he was caught off guard by the almost immediate switch to an all-cash system. He also mentioned the long lines at the ATM machines made it very difficult to obtain cash if you didn’t already have it. Make sure to add cash to your “Go Bag” or your fireproof safe at home.Financial Considerations for Preparing for Emergencies and Natural Disasters1. Understand your homeowner’s insurance and what it covers. Replacement cost value is one of the most important elements in a home insurance policy. If your house is destroyed by a problem covered by the policy, your dwelling insurance policy pays to rebuild it.• If your house costs more to replace than your coverage limit, you’d have to pay for some of the work yourself or reduce your rebuilding budget.2. A standard homeowners insurance policy covers your home against wildfires, tornadoes, hurricanes, hail, and other common storms, but not flooding from bodies of water. Furthermore, if you have flood insurance, understand the difference between flood damage and water damage. Under the vast majority of homeowner’s insurance policies, flood damage is not considered a form of water damage. Since standard homeowners' insurance doesn’t cover flooding associated with hurricanes, storms and heavy rains, it’s important to have protection from the floods that often accompany these types of disasters and to understand how your insurance company defines a “flood.”From Investopedia; You may need different types of insurance to mitigate disaster risks in your area. The precise types of insurance are region- and hazard-specific. The amount of coverage you will need can vary significantly depending on the location, the type of natural disasters prevalent, and home prices in your area.Homeowners in hurricane-prone areas might need windstorm insurance, while others may require flood insurance.Build a Robust Emergency Fund Using a Taxable Brokerage AccountIn almost any emergency, whether it’s a natural disaster, personal disability or financial catastrophe, quick access to money without being penalized (I.e., IRAs, 401ks) can provide the most security and peace of mind. We love it when our clients put forth the extra effort to build a large savings balance in a taxable brokerage account. A taxable brokerage account is very flexible and can be used for any purpose from retirement to college to funds to pay for living expenses in case of a disability. You can use a brokerage account to purchase investments, such as stocks, bonds, mutual funds and ETFs. A brokerage account doesn't have limits on how much you can contribute or what you can do with the money.We’ve seen the peace of mind and other emotional rewards pay off when someone has a healthy balance in their taxable brokerage account. For example, in 2020 when our world was turned upside down by the COVID 19 pandemic, many people dipped into their 401ks and withdrew large amounts or borrowed from them because of temporary government rules. Those that built a large savings balance had no need or desire to dip into their 401k in order to weather the COVID storm of 2020. I realize this is not always possible, as there were many brand new first officers that were furloughed or did not get hired as planned due to the pandemic.Currently Spirit Airlines is considering filing for bankruptcy. A friend of ours at Spirit has absolutely zero debt and a very healthy emergency fund. Although losing his job at Spirit Airlines is a disturbing possibility, he and his family are not nearly as stressed as they would be without a strong balance sheet. Finally, catastrophes and emergencies come in many forms. Although it may not be practical to be prepared for every possible scenario, there are many steps we can take so that we can weather the inevitable storm with less stress and more peace of mind. And, like we are seeing in the areas affected by Hurricane Helene, if you are prepared then you can quickly be of service to your neighbors and your community and lend a helping hand like our Leading Edge teammate, Whitney. She is a resident of Inman, SC near Spartanburg and Greenville, SC. After a day in Charlotte, NC to avoid the worst of the storm they returned home to help in any way they could. At one point they were helping to coordinate helicopter airdrops in remote areas of the western Carolinas most affected. I’ll conclude this article with a few of her comments. She texted our team while she and her husband George were working with Operation Airdrop to help hurricane victims. From Whitney: “All is well here, just still very disconnected - no power, no hot water, no gas and VERY spotty cell service. Thankfully we had minimal damage to our house/property and by some miracle, George was home for all of it. (He’s an airline pilot) We spent Sunday night in CLT for a little moral boost (yay hot showers and wifi!) but there were several reports of looting near us so George didn't feel comfortable leaving the house unattended, so we headed back to the darkness on Monday morning!The past two days have been incredible though. I've been working with an organization called Operation Airdrop coordinating helicopter drops into very remote areas! They had tons of helicopters and planes loaded with supplies but were having a hard time finding SXS (Side by sides) to help unload and distribute once they landed in these remote areas. I did what any good military/pilot wife would do (haha) and asked the Pilot Wives Facebook group if they knew anyone! Within 2 hours we were able to coordinate 2 drops full of medical supplies and food! Attaching one of the photos (see below) to this because how awesome are people! We have three more drops going out as we speak -- all coordinated via the Pilot Wives on FB! Wild.They need pilots on the ground to help with OPS and flight planning, etc. so we are heading back to Concord this afternoon. George will be working with the flight operations team and the boys and I are loading supplies.Also, if anyone you know is asking for a reputable organization to donate time or resources, I can personally recommend Operation Airdrop. I don't work for them obviously and they don't know me from any other volunteer out there, but they are truly saving lives and getting supplies directly into the hands of those that need it most!Hopefully this (message) sends and hopefully my hotspot will get me into the meeting this morning!” ~WhitneyPlease remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### The Pilot's Guide to Passive Real Estate Investing: What "Passive" Really Means In this video, Kevin Gormley from Leading Edge Financial Planning dives into the concept of "passive" real estate investing, breaking down the realities behind the word "passive" in different scenarios. We'll cover what passive income truly means, particularly in rental real estate. Kevin examines the distinctions in "passive" effort between three real estate approaches: hands-off investments, real estate with a property management company, and direct management without help from a property management company. He explains the tax implications, including the IRS’s definition of passive income and the impact on your taxes. Kevin also explores opportunity costs and time investment—what you’re really trading when investing in real estate. This video offers valuable insights for pilots interested in real estate to help you decide if it’s the right fit for your lifestyle. Gina Roth interview referenced: Flight #52: Real Estate Investing with Gina Roth (youtube.com) Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions ### United Airlines Benefits Open Enrollment: Key Health Insurance Options Explained Join Kevin Gormley, CFP®, CPA and Andy Christopher, CFA from Leading Edge Financial Planning as they explore the upcoming open enrollment period for health insurance. The fall season means it’s time for United pilots to review their health plans for the upcoming year. Many individuals stick to last year’s choices without reevaluating their options, but this discussion aims to encourage informed healthcare decisions. They break down essential terms like premiums, deductibles, co-pays, and co-insurance, emphasizing their significance in personal financial planning. The conversation also covers various health insurance plans for United pilots, including Health Savings Accounts (HSAs), Preferred Provider Organizations (PPOs), and Exclusive Provider Organizations (EPOs), as well as early retirement options and supplemental coverage as pilots transition to Medicare. If you're a United pilot or considering your healthcare options, this episode is packed with valuable information to help you navigate the complexities of health insurance open enrollment. Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions ### Spending Mindshift: Spend with Freedom and Peace of Mind From Runway to Retirement: Savings Priorities for Airline ProfessionalsAuthor: Nolan Clark The world of savings priorities and the newest financial strategies can be overwhelming, especially when each seems to have its own rules. I’m not here to push a one-size-fits-all approach, but rather to offer a fresh perspective, specifically with airline professionals like yourself in mind. Whether you're an FO aiming to strengthen your emergency fund and tackle debt, or a captain looking to maximize tax-advantaged accounts beyond your 401(k), the goal is to focus on strategies that fit your unique situation and goals. Below is a great list of long-term savings priorities for retirement that I will reference in this article, sourced from a comprehensive report by JP Morgan Asset Management. For a deeper dive, visit J.P. Morgan Private Bank (jpmorgan.com) to explore the full guide. Let’s dive into what really matters for you as a pilot and how you can make the most of your financial journey. 1. Emergency Reserve An emergency fund is essential for everyone, regardless of your life stage. It may not be the most exciting savings goal, but it's crucial because it's not a question of if you'll need it, but when. When looking up advice on a “healthy” emergency fund, you'll often see recommendations of 3-6 months’ worth of non-discretionary expenses. This typically covers essential costs like food, utilities, and housing. While this guideline works for many, it's not one-size-fits-all. As airline pilots, you know first-hand the volatile nature of the airline industry. Therefore, considering a larger emergency fund—6-9 months or even up to a year’s worth of expenses—might be more appropriate to navigate unexpected challenges. While this is a large amount of savings for many, the value of this step in all the priorities will be greater than the dollar value in your account. We see it time and time again with our clients who have the liquid savings to weather major storms that have a peace of mind in difficult times compared to those without. Tough times are already hard, we don’t want them to be any harder for you than they have to be. To help get some momentum, you can set multiple emergency fund goals along the way until you reach the ultimate number that works for you and your family. Having enough money saved to cover all your insurance deductibles is a great start, then you can work towards 3-6 months saved, 6-9 months, and so forth.  2. Maximize Your 401(k)-Employer Match Your employer match is one of the closest things to a "free lunch" in investing you’ll ever receive! Find out what percentage your employer matches up to, match your 401(k) percentage to that, and reap the benefits! 3. Pay Down Higher Interest Loans (Loans with Greater Than 7% Interest) Most people understand the impact of high-interest consumer debt and how it hinders savings goals. The real question is why people fall into debt in the first place. From what we see, it often comes down to lacking a solid emergency fund and not planning for large, foreseeable expenses such as crash pad costs, commuting expenses, changes in lifestyle when you upgrade, or other future costs. Without these savings, people may turn to high-interest credit cards when unexpected costs arise and it makes them feel more behind financially, even though they are making more money than ever. Here are a few questions to consider on this topic: (adapted from an article on the Financial Order of Operations written by The Money Guy Blog):   •  Does my mortgage count as high-interest debt? Unless you were fortunate enough to lock in a mortgage rate that you can count on one hand, you may be asking if your mortgage qualifies as high-interest debt. My wife and I bought a home this past year and have a 7% interest rate. Does this count as high-interest debt? While the interest rate itself does meet the 7% or greater criteria, there are a few reasons I may still count our mortgage as low-interest debt, and not be as adamant about making huge extra monthly payments. First, homes are typically appreciating assets, a distinct difference from consumer debt, student loans, car loans, etc. Mortgage interest may be deductible if you itemize your tax deductions. This could be even more of a consideration as the current tax laws expire in 2026 and the standard deduction will not be as large as in years past.  •  Which high-interest debt do I pay off first? Mathematically, paying off your debt with the highest interest rate first makes the most sense on paper. However, I am a big believer that the best debt repayment plan is the one you will stick to. If paying off smaller debts first motivates you more, you can start with those to build momentum. Just remember to consider the type of loan, minimum payments, penalties/benefits with paying off early/late, tax implications, and most importantly, your goals before you decide one way or the other. 4. Health Savings Account (HSA) For couples entering retirement this year, it is projected they could spend roughly $315,000 on healthcare alone during their retirement period, according to the annual Fidelity Retiree Health Care Cost Estimate. This sum doesn’t include long-term care, over-the-counter medications, or dental services. $315,000! That is a whole lot of money out of a retirement portfolio. Thankfully, there’s a specialized account designed to handle medical expenses: the Health Savings Account (HSA). An HSA offers triple tax benefits: contributions are tax-deductible, earnings grow tax-free, and withdrawals for qualified medical expenses are also tax-free. To qualify for an HSA, you must be enrolled in a high-deductible health plan (HDHP), which typically has a lower monthly premium but higher out-of-pocket cost. Additionally, HSA funds roll over from year to year, allowing your savings to grow over time. However, be aware that withdrawals not used for medical expenses may incur taxes and penalties. Lastly, while many people use HSAs as a fund for current-year medical expenses, an even better strategy could be to keep your funds invested and save your receipts for future use. Depending on your employer, you may also have access to other types of health savings vehicles, such as United's Health Reimbursement Accounts (HRA) and Retiree Health Accounts (RHA). We discuss this in more detail on our YouTube Channel: United Pilots: RHA & Healthy Fear of Healthcare Costs 5. Additional Defined Contribution Savings  For 2024, the IRS Defined Contribution Savings Limits are: •  $23,000 for those under 50 •  $30,500 for those 50 and older, which are the maximum amounts you can contribute to your 401(k). Many airlines also offer Non-Elective Contributions (NEC), which can boost the total contributions between you and your employer up to $69,000 for those under 50 and $76,500 for those over 50. That is a great chunk of money set aside for one year! This is not to mention the Market Based Cash Balance Plans (MBCBP) that many airlines have implemented that offer an extra savings vehicle. The key takeaway in this step is to focus on what you can control. If you’re under 50, aim to contribute the full $23,000 to your 401(k). If you’re 50 or older, strive for $30,500. Your company will do its part on the NEC. 6. Pay down lower interest loans (less than 7%) The low-interest loans have been able to hang around until step 6 because the above steps were important enough to put on the backburner, and the math made sense. Now, it is time to bring it home and pay it off!  While low-interest loans may be manageable, reducing your debt load can provide practical and psychological benefits. As mentioned before, remember to consider the type of loan, minimum payments, penalties/benefits with paying off early/late, tax implications, and most importantly, your goals before you decide one way or the other. There are times when not paying it off can make sense as well. For example, some folks have 2% mortgage interest rates locked in and have 25 years remaining on their mortgage. At the time of this article, some banks are offering a 5% interest rate on money just sitting there. We have clients who are still stashing that money away, but instead of locking it up in their homes, they have opted to save that money in a high interest bank account that offers them greater liquidity and flexibility. The beauty of this situation, if you’ve made it to step 6, is that you're well-positioned financially regardless of the outcome. At this stage, it's unlikely that either choice will significantly harm your financial future. While there might be mathematical differences between the options, the peace of mind and better sleep you gain could very well outweigh any other minor financial factors. 7.  IRA A traditional IRA involves pre-tax contributions with potential tax deductions, and earnings grow tax-deferred. Withdrawals are taxed as ordinary income and subject to penalties if taken before age 59 1⁄2, with RMDs required starting at age 73. A Roth IRA involves contributions made with after-tax dollars, allowing investment earnings to grow and be withdrawn tax-free if certain conditions are met. There are no required minimum distributions (RMDs) during the account holder’s lifetime, but contributions are subject to income limits. If your income is too high to contribute directly to a Roth IRA, you can look into using the backdoor Roth strategy. However, this approach can lead to unexpected tax consequences if not done correctly, so it’s crucial to consult with your tax professional. 8.  Taxable Account A taxable brokerage account can be used for short, medium, or long-term goals. It is taxed at favorable capital gains rates, and you can invest as conservative, moderate, or aggressive as appropriate depending on your goals. Many find that the taxable brokerage offers great flexibility compared to other retirement vehicles because there are no early withdrawal penalties for taking money out before age 59.5. This makes it a great account for those considering early retirement, an emergency fund, a college savings vehicle, or maybe you are saving up for that airplane you’ve always wanted; take your pick! Finally, I leave you with two quotes from personal finance expert, Morgan Housel. He explains in his book, The Psychology of Money, that sometimes sticking to a simple strategy is more effective than endlessly searching for the perfect one. Don’t get bogged down by details; focus on saving and spending less than you earn. •   “My own theory is that, in the real world, people do not want the mathematically optimal strategy. They want the strategy that maximizes how well they sleep at night." •   "The reasonable investors who love their technically imperfect strategies have an edge, because they're more likely to stick with those strategies.”   ~Nolan Clark Financial Planner Leading Edge Financial Planning, LLC.  Hopefully, you found this article interesting and helpful.  If you have any questions, contact us at:  • Phone: 270-545-5880    • Email: Nolan@leadingedgeplanning.com.   Also, please tell us if we can help you on your journey to financial peace and prosperity! Click here to sign up for our newsletter or click here to schedule some time to chat about your circumstances in more detail.  Also, check out our Pilot Money Guys podcast where we regularly discuss these types of financial topics along with some fun airline news updates and interesting guest interviews.   Sources & Links: • JP Morgan’s Guide to Retirement Slide Deck: J.P. Morgan Private Bank (jpmorgan.com) •  FOO - Your Ultimate Guide to The Financial Order of Operations | Money Guy • The Money Guy Blog - Blog | Money Guy • Fidelity Investments’ annual report on retirees’ healthcare planning featured in this MarketWatch article: The cost of retiree healthcare is climbing — here’s what you should expect to spend - MarketWatch •  What Is a Health Savings Account? How It Works, Tax Benefits, Drawbacks and More - CNET Money - CNET • Leading Edge Financial Planning YouTube Video - United Pilots: RHA & Healthy Fear of Healthcare Costs • Schwab Backdoor Roth Article: Backdoor Roth: Is It Right for You? | Charles Schwab • How Brokerage Accounts are Taxed in 2024 - Benzinga • 529 vs. Brokerage Account: Which Is Better for College Savings? (savingforcollege.com) Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### A Pilot's Guide to Real Estate Investing       Pilot's Guide to Real Estate Investing: Tax Benefits & Wealth Building Kevin Gormley, CFP®, CPA presents a comprehensive overview of Real Estate Investing specifically tailored for pilots and their families. Discover why many pilots are drawn to real estate, including the potential for tax savings, passive income, and long-term wealth generation. Kevin discusses the risks and rewards of real estate investing, providing valuable insights into expected returns, market research, and the importance of informed decision-making. Whether you're considering your first investment or looking to diversify your portfolio, this guide can equip you with the knowledge you need to navigate the real estate market effectively.  Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions ### One Reason To Invest in Roth NOW Tax Changes Ahead: Why Invest in a Roth IRA Now Kevin Gormley, CFP®, CPA discusses upcoming changes in tax policy that may affect your retirement investment strategy. With the expiration of the Tax Cuts and Jobs Act on January 1, 2026, the tax landscape is set to shift significantly, potentially resulting in higher taxes for many individuals.  Kevin outlines key strategies for investing in Roth IRAs, Roth 401(k)s, and utilizing “Backdoor” Roth conversions. He emphasizes the importance of considering these options, especially if you're in your 60s and have substantial funds in traditional IRAs or 401(k)s. This discussion offers valuable insights into how these strategies may help you minimize your tax burden and maximize your retirement savings.  Please note, Roth investments and conversions can potentially affect your taxes in the current year. Consulting a tax professional is essential before implementing this strategy. Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions ### Why Estate Planning is Essential for Pilots Professional pilots are economically valuable and worth every penny earned not just because they can fly safely from Chicago to LAX.  The real reason pilots are so valuable to their airlines and the flying public is that they are prepared to navigate dangerous weather, handle in-flight emergencies, and make difficult decisions. In other words, pilots are trained to get their passengers safely where they want to go regardless of what happens along the way. One of the most difficult things pilots do is prepare for an event that will most likely never happen in your flying career.  In almost 25 years of flying, I never lost an engine.  Which is great because one of my airplanes only had one engine!  I never lost a hydraulic system or experienced a dual-engine flameout, Sully-style.  However, I did (and you continue to) prepare for these events as if they are common occurrences.  This requires tremendous discipline, preparation and intense attention to detail.The financial equivalent of preparing for life’s catastrophes is what financial nerds call estate planning.  I explain the gist of estate planning with a question to our pilot clients; will your spouse and children be okay if the unthinkable happens to you on your next trip?  It takes a lot of planning and preparation to answer this question with a confident “yes!” In this article I will explain the action steps and resources to help you confidently answer “yes” and have peace of mind knowing you’ve done everything you can to take care of your loved ones in case of a catastrophic life emergency.Preparing for our own disabilities or death is akin to preparing for an engine loss right at rotation. It’s very unlikely that it will happen to you during your airline career. However, many pilots experience premature death and disability every year. But like the catastrophic emergency in the airplane, it’s hard to fully comprehend that it might happen to you at any moment. I recently returned from a family vacation in Edisto Beach, SC. The water was very rough with strong winds and currents. I shared with my kids about rip currents and what to do in case they thought they were in one. Tragically, when we returned from our trip, I noticed an article about two parents drowning in a rip tide while their six children were on the beach in Stuart Beach, FL.  Sadly, their children tried to yell instructions to the parents while dialing 911 from the beach.  It’s hard to comprehend this devastating family tragedy. I’m sure the parents woke up that morning and thought, like the rest of us, those tragic things only happen to other people. Therefore they may not have been fully prepared for this unimaginable scenario. Can you imagine the estate planning that needs to be considered when both parents with six children pass away? Who will take care of the children- aka guardianship? Who will take care of the financial needs of the children? Especially if they are minors. These are questions many of us need to address and prepare for. While we can rationally acknowledge that we will all die someday, we can't imagine our own deaths.  In fact, it may be our brain’s biological tendency to protect us. In a research study conducted by Bar Ilan University in Israel, Yair Dor-Ziderman explains; “The brain does not accept that death is related to us...We have this primal mechanism that means when the brain gets information that links self to death, something tells us it’s not reliable, so we shouldn’t believe it.”“...The moment you have this ability to look into your own future, you realize that at some point you’re going to die and there’s nothing you can do about it,” said Dor-Ziderman. “That goes against the grain of our whole biology, which is helping us to stay alive.”I probably should have prefaced that section with the same warning in the article I quoted; “Warning: this story is about death.  You may want to click away now.” However, as I mentioned in the first sentence of this article, the very reason you are so valuable as a professional pilot is because it is your job to prepare for scenarios that we believe probably will not happen to us. And in the airplane, the chances are in our favor that they never will happen. On the other hand, we’re all gonna die...someday! I know you’re inspired now, right? Now that you know why it’s so difficult to get around to accomplishing estate planning for your family, it’s time to do some of that pilot stuff and get it done! Let’s start with the question:Will your spouse and children be okay if the unthinkable happens to you on your next trip?Here are the essential steps to prepare for your potential disability and/or untimely death:  1. Do you have the essential estate planning legal documents?Estate planning attorneys recommend that we all have the following documents at the ready:Power of attorney; financial and healthcareLast Will and TestamentBeneficiary designationsLiving WillLife insurance policiesTitles and property deedsLiving Trust – may or may not be required, depending on circumstances. 2. Ensure the loss of your income will be replaced by savings and life insurance.3. Does your spouse know where to find essential documents listed above?Take inventory and make sure everyone knows where to find these documents and passwords.  Review the contents and location occasionally.4. Does your spouse have access to cash, funding to pay bills in your absence?Our experience was that financial account transfers and life insurance payouts can take some time.  Be sure to have access to several months of cash to keep the household going while waiting for access to other assets.5. Digital logins and passwordsThis deserves its own category now.  Consider using a password manager for information security of passwords plus the ease of sharing with your spouse. Click here for a PDF version of an estate planning checklist from Freewill.com.Great resources to help get with estate planning•    Great website: Getyourshittogether.org:  https://getyourshittogether.org/I almost always refer to this website to help people.  Not just because the name of the website is awesome! Founder and author of “What Matters Most”, Chanel Reynolds, experienced the premature death of her husband at a very young age.From her website, “I am immensely proud of the book and grateful for the opportunity to tell the whole story of what happened, what I wish I’d done and what you can do when life goes sideways and what can help before and after the shit hits the fan...”Another excerpt from the website: “Will you be prepared if life knocks you sideways?Get your family protected with the critical ‘What-if’ answers like wills, power of attorney, healthcare directives, digital details and legal documents you need today and someday...”•    Online website, TrustandWills.com, for great information and getting your estate documents completed:There is still much debate about getting estate planning legal documents accomplished online.  I can’t give advice in this format, but I will say the online resources have vastly improved over recent years.  Using TrustandWills.com you can accomplish estate planning and get the support of an estate planning attorney in your state. From their website:   “Just like estate planning isn’t a one size fits all deal, neither is the help that our clients need. That’s why we're giving our members access to one-on-one time with licensed estate planning attorneys in their state. We want to offer products and estate planning tools that are inclusive for everyone, whether you have a multi-million dollar estate, or you’re just starting out planning for the future. Learn more about the benefits of Attorney Support.”I have not personally used TrustandWills.com for my own estate planning documents, but I refer to this website regularly for great information, resources and learning. •    Workbook – “I’m Dead Now What?”We often give this book as a gift for those who prefer a physical document(s) to refer to in case of emergencies.  This book, if completed correctly, covers all the nitty gritty details that a loved one will need to know in case of the unexpected death of a spouse.  The circumstances will be more difficult than we can comprehend, I believe we should not make it worse by not being organized. •    Airline specific financial podcast (and shameless plug), Pilot Money Guys Flight #12: I’m Dead, Now What? This is part 2 of the Estate Planning Series "I'm Dead, Now What?" Three steps to make sure your estate is prepared. If you are unsure whether you have a good plan for the unexpected, this is the podcast for you...documents you need to have in place, why getting organized is important, and how beneficiaries and trusts go together to protect your family. Also see, Pilot Money Guys Flight #13: I’m Disabled, Now What? Charles Mattingly, MBA, CFP®CEO, Leading Edge Financial PlanningHopefully, you found this article interesting and helpful. If you have any questions, I can be reached at 865-240-2292 or charlie@leadingedgeplanning.com. Also, please tell us if we can help you on your journey to financial peace and prosperity! Click here to sign up for our newsletter or click here to schedule some time to chat about your circumstances in more detail.  Also, check out our Pilot Money Guys podcast where we regularly discuss these types of financial topics along with some fun airline news updates and interesting guest interviews.  Even the editor and founder of Aero Crew News – Craig Pieper!Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Not Your Parents Long Term Care Insurance Understanding Long-Term Care Costs: New Insurance Options Kevin Gormely, CFP®, CPA and Todd Russell CFP®, President of Private Client Strategies, LLC dive into the evolving landscape of long-term care insurance and its critical role in financial planning. With rising healthcare costs and the increasing desire to age in place, understanding the new generation of long-term care products is essential.They explore the financial risks associated with long-term care, discuss how these costs can impact your savings, and explain how modern insurance policies can help mitigate some of these risks. Whether you're planning for yourself or loved ones, this discussion offers valuable insights into making informed decisions about long-term care.Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### How to Determine if Rental Real Estate Investing is Right for You It seems like there is almost a sense of obligation to purchase rental real estate once a person hits one of two financial milestones: 1. They maximize their airline retirement savings plan 2. Their income tax bill becomes so onerous that it compels them to take evasive action! If you’re not there now, you will be soon! Are either of these milestones reason enough to pull the trigger and purchase physical real estate for rental? My short answer is, no! However, there may be some other good reasons to do so, and we’ll explore them in this article. In my financial planning practice, I am fascinated by the number of people that almost feel a sense of obligation to purchase rental real estate. It’s as if there’s a message out there somewhere that says: • Step one: max 401k • Step two: purchase rental real estate Otherwise, you’re not really a sophisticated or properly diversified investor.  Unfortunately, real estate is not always the tax savings or investment panacea it’s made out to be. In this article, I will explain some common myths and misconceptions about the tax and investment benefits of owning rental real estate. If you’re in a hurry, look to the end of each point for the lessons learned. These lessons may prevent you from going down a path that may not be right for you or, at least, prevent you from making the same mistakes I did! 1. Rental Real Estate is Not a Hands-off Activity There is no easy money. Grant Cardone makes it look like you purchase a real estate property and then board your private jet for the Caribbean. Easy breezy! The phrases “side hustle” and “passive income” sound sexy and easy, but they are extremely misleading. In my experience, if you’re investing in real estate the right way, you’re probably self-managing and maybe even doing some of the work yourself. Sweat equity! If you’re outsourcing all these tasks to a management and maintenance company, be sure to check your profit margins and compare them to an alternative investment. We’ve seen people spend all their investment profits on HOA fees, management, maintenance, taxes, insurance, etc. There are plenty of other great investments that do not require any of those expenses. Lesson Learned: Always think about the opportunity cost of investing in real estate. For example, you can get close to 5% guaranteed right now (August 2024) in treasury bills without worrying about renters, maintenance, and eviction notices. Make sure you’re rewarded appropriately for the time, money, and risk of real estate investing. 2. Are You Running a Real Business or Just Being Nice? Many rental real estate investors that I know do not treat their rental real estate like a real business. I’ll use my father-in-law as an example. He’s the nicest guy in the world, so he rarely raises his rent. There is some value in keeping your renters happy if they treat your property well. However, no matter how nice your renters are, you don’t need to take money out of your business and give it to people. That’s called charity. • Capitalization Rate (Cap Rate): Evaluates the profitability of an investment property. A higher cap rate indicates a higher potential return on investment. This is also a great number to evaluate whether the time and effort are worth investing in rental real estate. Cap rate = Net operating income ÷ Property value: Example: $24,000 (net operating) ÷ $500,000 (property value) = 4.8% Cap Rate In this scenario, your success as a real estate investor hinges on the hope that your property will significantly appreciate. This is because  (At the time of this writing- August 2024), you could get approximately 4.5% - 5% in a treasury bill guaranteed, with zero effort or worry about renters. If you believe you have a high chance of property appreciation, you may be willing to accept a lower cap rate and vice versa. However, be careful that solely relying on property appreciation does not become your main real estate strategy.  One maxim of real estate investing that stuck with me was, make money when you purchase, make money when you rent, and make money when you sell. I learned from experience that any one of those is relatively easy to achieve. All three of those components are challenging and take great effort and due diligence.  • Net Operating Income (NOI):  Shows how much money a property is making. It can help evaluate your return on investment (ROI), assess cash flow, and make decisions about pricing, expenses, and business strategy. NOI is used to measure the profitability of your property.  To calculate the net operating income (NOI) of a rental property, use this formula: Real estate revenue – Operating expenses = NOI The NOI is used mainly to determine if a property should be considered for investment. Calculating NOI shows your potential profitability. If a property has a very low NOI compared to similar rentals in the area or investment alternatives, you may want to look elsewhere to invest your money. • Non-measurable Measurables: What is your time worth?  You may be able to put a precise number on this since you are paid by the hour.  Don’t forget to factor in the cost of your time when calculating the cap rate and the NOI.   Lesson Learned: Do you enjoy being a real estate landlord? Or do you worry or stress about the next call from the renters or management company?  I did, and it sucks! I became tired of the kids flushing their toys down the toilets. I also did not like the boyfriend threatening to burn the place down because my renter broke up with him. True stories! And there are many more good stories where those came from. Those events helped me to remember that I had the ability to earn as much as one month's rental income by picking up a two-day airline trip! 3. Use Leverage Wisely! Leverage: When I helped a friend run all the rental real estate numbers like a real business, I realized that using leverage (borrowing-mortgage) played a major role in the profitability of his rental real estate. Does this mean you should borrow 100% of the property’s value? Absolutely not.  Think Great Financial - Housing Crisis 2008. Brought on largely by the over-levered housing consumer. On the other hand, is completely paying off every rental property the highest priority? Probably not. You, as the investor, must be comfortable with a responsible balance of debt. One thought to guide your decision is to consider if you could make the mortgage, property tax and insurance payments if there were no renters? How long could you sustain these payments with no renters? These are questions you must consider as a real estate investor.  4. Tax Implications of Owning Rental Real Estate: The good, the bad and the many disclaimers and exceptions. First, never let the tax tail wag the dog! Focus on increasing your net worth and purchasing quality investments.  The tax benefits are a nice secondary benefit.   Paying taxes often evokes a visceral response and drives us to take actions that may reduce our net worth solely to reduce our tax burden. I’ll admit, it is a nice feeling when I get that two-thousand-dollar refund at tax time. (Even though it may be better to zero out my tax refund as to avoid loaning the Government my money.)  The point is we are overly focused on the net tax result at tax time.  We quickly forget about the benefit of rental income during the year. For example, many people are willing to reduce their monthly rental income to zero, usually by spending more on the rental property, simply to avoid a large tax bill in April.  We find ourselves advising clients not to lose money on purpose just to save on taxes!   Lesson Learned: Purchase quality real estate that may provide a good return on your investment. Focus on the investment and the tax benefits will follow.   Depreciation Tax Deduction:  The phantom rental expense.   Rental property owners can use depreciation to deduct the property's purchase price and improvement costs from their tax returns. Here are two quick examples to explain the benefits of depreciation. But before I wade into these dangerous tax waters, understand that there are exceptions to every tax rule and something that initially sounds like tax magic will probably be taken away by the IRS as your income increases. This is the case with depreciation of rental property as well.  Click here to learn more about the details of MACRS depreciation system. Overly simplistic example for illustrative purposes: Deducting the depreciation expenses from your current rental income (probably not deducting from your airline income – see below and seek advice from a tax professional):  The IRS assigns a “useful life” to residential rental property of 27.5 years. Therefore, if you purchased your property (cost basis) for $300,000 then you simply divide the cost basis by 27.5. Your potential depreciation tax deduction may be $10,909 per year.  For every full year a property is in service, you would depreciate an equal amount:  3.636% (100% divided by 27.5) each year as long as you continue to depreciate the property. More disclosure: Do not use this example to calculate your tax deductions. If your income exceeds certain limits, you may have to defer the deduction. You would also need to calculate the true adjusted cost basis which is not equal to the purchase price of the home.   Lesson Learned: Take the time to understand these tax nuances. It’s not good enough to delegate this knowledge to your tax preparer. They can help you accomplish your tax return correctly but if you want to be a great CFO of your real estate business, you need to have a working knowledge of the IRS tax regulations pertaining to rental real estate.   Do not expect to offset your airline income with rental real estate losses. In most real estate investing scenarios, you will not be able to deduct rental real estate losses against your airline income.   Real estate investors have been known to spend lavishly on anything having to do with their rental properties, thinking that the tax-deductible expenses would reduce their airline income and therefore their income taxes. Why not spend $80,000 on a used Kubota skid steer for your rental property if you could use that expense to potentially save $19,200 in income taxes. Wow! Less taxes and an awesome toy.  Unfortunately, there are very strict tax rules about deducting passive real estate expenses against your active airline income. To better understand this concept, we first must know that the IRS’s definition of active and passive income is very different from that on Instagram.  First the easy definition – active income is income received from a job or business that you actively participate in, such as your airline job. From TaxSlayerPro.com:  “Passive income” is often used colloquially to define anything from stock investments to blogging. But the IRS has specific parameters for passive income activity. For tax purposes, true passive income activities are either 1) “trade or business activities in which you don’t materially participate during the year” or 2) “rental activities, even if you do materially participate in them, unless you’re a real estate professional.” The last statement is what really limits an airline pilot’s ability to deduct real estate expenses from your airline income.  So, what is a real estate professional you ask:  From IRS.gov; Instruction for Form 8582: Any rental real estate activity in which you materially participated if you were a “real estate professional” for the tax year. You were a real estate professional only if: More than half of the personal services you performed in trades or businesses during the tax year were performed in real property trades or businesses in which you materially participated, and You performed more than 750 hours of services during the tax year in real property trades or businesses in which you materially participated. It is not impossible to be considered a real estate professional but the “...more than half of the personal services you performed...” statement is the one that usually prevents pilots from also being considered a real estate professional. Clearly if you are married, filing jointly and your spouse is a legitimate real estate professional, you may be able to take advantage of the tax benefits of a real estate professional.  Lesson Learned:  Use caution and seek professional legal and tax advice to keep out of trouble if you decide to pursue this path.  What can you deduct and why may quality real estate still be a tax-smart investment?  Even though you may not be able to offset your airline income with rental expenses, you can offset your rental income with expenses incurred in the activity of renting. For example, if I earn one thousand dollars per month in rent, that could potentially be taxed at my marginal income tax rate. For an airline pilot that can easily be 24%, 32% or even higher, considering the latest contract bonuses and pay increases.  That could increase my tax bill by $3,840 (32% x $12,000). That feels really painful when the tax bill comes due in addition to your airline tax bill. (You’ll quickly forget about the $12,000 in rental income you made throughout the year!) So, in this example you could use your advertising costs, auto expenses, cleaning costs, and our favorite, depreciation just to name a few. Clearly you would not want to spend more on advertising simply to reduce your taxable income, but the expense can help reduce your tax bill if you need to advertise.  Lesson Learned:  Keep great records of all your potential deductible expenses. It will be required if you get audited by the IRS and it will help you determine if you’re spending too much on your investment.   5. The psychology of money can make rental real estate a good investment. That sounds weird so let me explain. Many of us stress out about the stock market fluctuations. The fact that the stock market seemingly tanks at the release of any negative news headline is frustrating to many people.  Furthermore, we can view the value of our investments minute-by-minute on our phones. It seems like when the price of an investment goes down because of something completely unrelated to the quality of the company, my life savings disappear.  When I own rental real estate in my local town, or any location really, I usually do not see or hear about any price fluctuations. In fact, before the housing crisis of 2008, we began to believe that the price of real estate could not go down!  We learned the valuable lesson that real estate values can and will go down but at least I can’t see the price fluctuations minute-by-minute like I do in my 401k. This can be a tremendous benefit that helps me stay the course with my rental properties. Investing in real estate, especially locally, gives investors a sense of control. And, sometimes, there really is more control. For example, you may have valuable information about your local real estate market that another investor might not have access to. In the world of stock investing, this is called insider trading and it’s illegal. Furthermore, in the stock market, any valuable information is processed and integrated into a stock's price in milliseconds. This is called an efficient market.  Your local real estate market is most likely not an efficient market.  Lesson Learned:  Find mentors that know your local area. Get involved in local organizations like the chamber of commerce. Learn about what new businesses are coming to your area. Network with local real estate agents since they may be the first ones to know when a property may become available.  Hopefully, you found this article helpful in deciding whether investing in rental real estate is right for you.  There are many people that are really good at investing in real estate and being landlords. Those people are really good because they enjoy it, and they believe it’s worth their time. I am not one of those people! I’ve been down that road most of my adult life and I learned it’s not for me.  In my humble opinion, I can get exposure to many different types of real estate investments through the public stock markets. More importantly, I’m the type of person who is okay with the temperament of the stock market. Many people want relief from that roller coaster ride, and I understand that.  Final Lesson Learned The final lesson for helping to decide whether investing in real estate is right for you is to know thyself!   •  What do you want?  •  What do you enjoy doing with your time?   Life is short, don’t do anything solely for the benefit of taxes or even to make a bit more money if that’s not what you really need. See Pilot Money Guys podcast to learn more about investing in rental real estate:  Flight #52: Gina Roth on How to Be a Real Estate Professional and Save on Taxes. Charles Mattingly, MBA, CFP® CEO, Leading Edge Financial Planning If you have any questions, contact us at:  •  Phone: 865-328-4969   •  Email: charlie@leadingedgeplanning.com.   Also, please tell us if we can help you on your journey to financial peace and prosperity! Click here to sign up for our newsletter or click here to schedule some time to chat about your circumstances in more detail.  Also, check out our Pilot Money Guys podcast where we regularly discuss these types of financial topics along with some fun airline news updates and interesting guest interviews.   Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### United Pilots: RHA & Healthy Fear of Healthcare Costs       Kevin Gormley, CFP®, CPA and Andy Christopher, CFA and Lead Financial Planner, discuss the intricacies of Health Reimbursement Accounts (HRA) and Retiree Health Accounts (RHA), exploring how to determine the optimal amount to save for future healthcare costs in retirement. They break down the advantages and limitations of these accounts, provide mental models for effective saving, and offer practical tips for United pilots.     Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions.   ### Southwest Airlines Market Based Cash Balance Plan SWA Market-Based Cash Balance Pension Plan (MBCBP) Tips and Techniques Below is an overview of the topics we cover in the video: • Market-Based Cash Balance Plan basics • Why do we love it? • How to max out the MBCBP • How to minimize your 401k spillover if you do not want more MBCBP. • How to use the potential MBCBP tax savings to contribute more Roth to your retirement savings. Leading Edge is not affiliated with Southwest Airlines.  This is informational only.  Please refer to the Southwest Airlines Pilot contract for further information. Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Planning for Your Long-Term Care Needs     As a pilot, you may be very familiar with the life insurance and long-term disability coverage provided to you by your airline. However, one of the more overlooked aspects of financial planning is the need for long-term care (LTC), especially in our later years as health declines and we’re unable to care for ourselves. While your first thought may jump to LTC insurance, it’s important to emphasize that LTC planning goes far beyond the question of how to pay for medical services that you may need. Personally, I’ve seen challenging end-of-life scenarios negatively impact both the individual needing care and family members due to: • The high costs of in-home care• Dissatisfaction with nursing home care • An undue burden on children/family members to personally provide care Further complicating the planning is that many times the decisions surrounding LTC are taken out of the individual’s hands due to diminished mental and physical capabilities. Because of that, it’s vital to contemplate your ideal LTC scenario and put plans in place today to make sure your wishes are carried out. In this article, we’ll focus on: • The costs and types of care• LTC insurance options • Estate planning tools available First off, what is long-term care? The term is quite broad, and the types of services included in “long-term care” are highly dependent upon the level of care you desire, need, and can afford.  For example: • You may prioritize remaining in your home until death. In that case, it is important to plan for the costs associated with having in-home care available and potentially modifying the home to accommodate your care needs.• On the other hand, you may love the idea of moving to an assisted living facility with services available on-site. Unfortunately, sometimes we don’t get to decide how our LTC plays out. For example, those who suffer from extensive health issues that can’t be managed at home and/or Alzheimer’s or dementia may require care at a memory facility since staying at home may be unsafe.  We will all likely need some level of long-term care. Because of that, it’s important to think about your desired level of care (e.g., staying at home) and the myriad of “what-if” scenarios.  What is the likelihood you’ll need traditional LTC services? LTC is typically geared towards those who are retired/later in life. Statistics tell us that: • A 65-year-old has a 70% chance of requiring some form of LTC for the remainder of their life.• Typically, the average length of care needed is three years, with women averaging 3.7 years versus men at 2.2 years.• For those between the ages of 40 and 50, the number drops to 8% of people who will require LTC services.  Keep in mind these are all averages. Some people may never need LTC, while others may require care for much longer. Even five years or more is not unheard of. Costs of LTC The costs associated with LTC can be steep, vary by location, and depend upon the level of care you are seeking or need.  For example:  • In the Dallas, Texas area the average monthly cost of in-home care is $5,720 per month.• A private room in a nursing home or facility on average can cost $7,178 per month.  To see the costs in your area, Genworth has an easy-to-use calculator: Genworth LTC Calculator.  Unfortunately, these costs have been rising rapidly. From 2021-2023, the cost of an assisted living facility has risen over 18%, while in-home care for homemaker services has risen by over 22%.  Paying for LTC The next logical question when planning for LTC is how to pay for those services. The easiest option is to “self-insure” the costs. When considering this option, it’s important to look at the costs you might incur and if your income from Social Security, pensions, annuities, and your retirement savings will be sufficient to cover them. Fortunately, most financial planning software can run this type of analysis. Again, LTC may not be a discretionary spending category depending upon your ailments or care needed.  You’ve probably heard horror stories (or experienced this yourself) of children effectively becoming the in-home care provider or having to pay for nursing facilities out of their own pocket due to the reasons mentioned above. On the other hand, suppose you can afford to self-insure, but giving your children or other beneficiaries a portion of your estate once you pass and not having that value eaten into by expensive LTC costs may be of high importance. In that case, or if you’re concerned that the future costs of LTC may greatly exceed your predicted income and savings, there are insurance options available.   The long-term care insurance industry has been on a bit of a roller coaster ride due to a rapid increase in medical costs over the years. First offered in the 1970s and 1980s, this coverage has evolved over the years. At the turn of the century, insurers realized they had mispriced the cost of insurance and premiums increased rapidly, with many providers of LTC insurance exiting the market altogether. What was once a relatively inexpensive type of insurance became prohibitively expensive for insurers . Unfortunately for the insurers, longer life expectancies have increased the likelihood of needing LTC, thus making coverage more expensive.  With that said, LTC insurance is still available as both a straight policy (premiums pay for LTC only) and hybrid policies (life insurance combined with a LTC rider). Due to the high premium costs, many people prefer to seek a hybrid policy. The rationale being that if you don’t (fortunately) use the LTC provisions of a policy then the money you put into the coverage isn’t for naught. Of course, with any type of whole life or indexed universal life policy the terms can be quite complex and the policies can be difficult to surrender, so it’s important to discuss the pros and cons with a disinterested, (e.g., not someone who benefits from selling the product via commission) trusted advisor before securing the policy.  Additionally, when considering an insurance approach to funding LTC, there is a big difference between the care you want (e.g., homemaker to come to the house and cook/clean) versus when the policy will pay out. Let’s explore some of the more important aspects of LTC insurance to review when considering a policy: Type of policy: As mentioned earlier, you can secure a “straight” LTC policy or a hybrid policy linked to a permanent life insurance policy.  • The LTC-only policy will likely be less expensive, however, a common critique is that the premiums paid will be a “sunk cost” if the LTC benefit isn’t needed. Additionally, premium costs can increase year over year and will likely have to be paid to keep the policy in force.• On other hand, a hybrid policy can provide the features of a traditional life insurance policy with a LTC benefit rider. While these policies tend to be more expensive, the death benefit/cash value can be appealing.  Eligibility: Typically, this is associated with an inability to perform a specified number of ADLs (activities of daily living) defined as bathing, dressing, toileting, transferring, continence and/or feeding.  In many policies, to qualify you must be unable to perform two of the six ADLs. As you can see, an ADL threshold is far different from, “I want someone to cook dinner when I’m older.” It’s important to pay close attention to make sure the policy will pay when you want it to pay.  Waiting Period: A longer waiting period means that you’ll have to pay out of pocket for any care required before the insurance policy pays. As in most LTC, disability-type insurance policies, having a strong savings and emergency cash on hand is important, especially if you’re dependent on pension or annuity to support your lifestyle in retirement. A typical waiting period is 90 days.  How does the policy pay?  Certain policies will only reimburse directly for services. Other policies will simply pay the maximum monthly benefit amount if you meet the eligibility requirements. The latter may be more expensive but can be less administratively burdensome and potentially pay a higher monthly amount depending upon the cost of care.  Benefit amount: Most LTC policies will pay both a monthly maximum amount and maximum total amount where payments cease once the LTC benefit is exhausted. For example, a policy that pays a maximum of $20,000 per month with a total benefit of $500,000. Assuming you use the full monthly amount, you would have a little over two years of coverage.  This is probably one of the most important features of an LTC policy. If you want the ocean-front view, you’ll probably need a higher coverage amount. Also keep in mind that costs for care will likely rise. If you’re securing your LTC policy at a younger age, you may want an inflation rider on the policy to make sure your benefit keeps pace with what coverage will cost 10 plus years down the road. Of course, an enhanced benefit will probably mean higher premiums. Premium amount: All the features discussed above will impact the premium that you’ll pay. When considering the policy, you want versus the policy you can afford, this is where the rubber meets the road. Straight LTC will typically require premiums to always be paid (any may increase over time) to keep the policy in force. A hybrid policy, on the other hand, can be structured to pay premiums only to a certain age (e.g., 65).  Whether you decide to plan for your LTC costs via savings or an insurance policy, there are other estate planning matters to consider. Specifically, implementing (or reviewing periodically for those who already do have) a living will and advanced healthcare directive.  • A living will, as the name implies, dictates how you would like to be cared for in the case of incapacitation. For example, you can dictate under what circumstances you would allow CPR or mechanical ventilation.• Additionally, you should create a durable power of attorney for healthcare to name an agent who you trust to execute your living will or make decisions in the case that you are in a situation not covered by the living will. As with any estate planning documents, it’s always a good idea to consult with an attorney when having legal documents made. As you consider other means to provide for a potential LTC need, it’s important to emphasize that most private insurance providers and Medicare do NOT cover LTC . This is a common misconception that leads many to falsely believe that they have coverage, when in fact, they don’t. That said, it’s always important to review your insurance since certain services may be provided. For example, Tricare doesn’t cover assisted living, but does cover home health care if certain conditions are met.  Perhaps more important than determining how you will pay for long-term care is starting the process now of contemplating what your end-of-life care looks like from a values and preferences standpoint. Doing this allows you to prepare your friends and family to represent your needs and wishes and ensure your beneficiaries are cared for.  Fortunately, simple estate planning in the form of advanced directives can accomplish much of this planning. While we don’t know how our long-term journey and the costs associated with that care will “play-out”, by visualizing your ideal state and planning for “worst case” you’ll hopefully be on a path of financial security and contentment.  ~Andrew Christopher, CFA Lead Financial Planner and Chief Investment Officer Leading Edge Financial Planning, LLC.  Hopefully, you found this article interesting and helpful. If you have any questions, contact us at:  • Phone: 865-240-2292• Email: Andrew@leadingedgeplanning.com.   Also, please tell us if we can help you on your journey to financial peace and prosperity! Click here to sign up for our newsletter or click here to schedule some time to chat about your circumstances in more detail.  Also, check out our Pilot Money Guys podcast where we regularly discuss these types of financial topics along with some fun airline news updates and interesting guest interviews.  Even the editor and founder of Aero Crew News – Craig Pieper! LEGAL DISCLAIMER Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. [1] https://acl.gov/ltc/basic-needs/how-much-care-will-you-need [1] https://pro.genworth.com/riiproweb/productinfo/pdf/131168.pdf [1]https://ltcconsumer.com/resources/ltci-library/the-history-of-long-term-care-insurance/ [1] https://www.care.com/c/activities-of-daily-living/ [1]https://www.nia.nih.gov/health/advance-care-planning/advance-care-planning-advance-directives-health-care [1] https://www.medicare.gov/coverage/long-term-care ### Live like a Multi-Millionaire Pilot: 7 Action Steps for Success Dreaming of a multimillion dollar nest egg? Kevin Gormely, CFP®, CPA shares 7 practical actions pilots can take to significantly increase their chances of achieving financial freedom. Learn valuable tips like maximizing retirement contributions, understanding healthcare costs, and creating a strategic savings plan. The video is inspired by the wisdom of Charlie Munger, who emphasizes consistent smart financial decisions over chasing high returns. Forget the "when I get rich" fantasies and start building your wealth today!Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Stop Budgeting and Change Your Spending Mindset!     Of all the so-called sophisticated investment strategies that exist, I’m not sure any are as effective as building a solid foundation for how we spend our money.   The way we spend our money reflects our belief system and values. For example, if I value time together as a family and with kids, it may be a good use of my money to purchase a backyard pool. On the other hand, if I purchase items solely because I can afford it and it’s because that’s what other people are buying, then the items I purchase may make me more unhappy than if I hadn’t purchased them at all.   This is the non-mathematical concept behind the economic concept of Opportunity Cost. Chances are, we are all familiar with the idea that if I spend my money or make an investment in one area there is always the opportunity cost that must be considered. For example, before I purchase the monster truck I’ve always wanted, I must consider the opportunity I missed by not putting my money in an investment or savings account that may be able to yield four or five percent.  After analyzing the opportunity cost, the monster truck is much more expensive than I may have originally thought.  The often-overlooked part of Opportunity Cost is the emotional component of our spending. Every time we make a decision to spend or invest our money in something, there is an emotional cost that we must consider as well. That emotional cost comes in the form of more stress due to budgeting constraints. Possibly more discord in our marriage because one person is a saver, and the other is the spender. What does this look like in real life? As a financial adviser (and former airline pilot), I get the opportunity to learn many valuable lessons from all of our clients. Many of our client families have done exceedingly well at saving money not only in their retirement accounts but also in their checking, savings and other non-retirement accounts as well. When I ask them how they can save in excess of retirement needs they simply respond with comments like these: •     “We only spend on things that we know are going to bring us tremendous value.” •     “We just don’t need to spend that much in order to enjoy our friends and family.”•     “We learned that spending money on items just because someone else is doing it actually makes us unhappy.”•     “We spend lavishly on the things that bring our family joy and we skimp on everything else that doesn’t.” What I’ve learned from these informal interviews is that it’s not always about a fancy budgeting system. It’s not about using your superhuman willpower to forgo buying cool stuff. In fact, buy the cool, fun stuff! But make sure you only buy the cool, fun stuff that truly aligns with your values. So, how do we make great spending decisions considering the emotional and mathematical components of Opportunity Cost? I came across a great article the other day by Joshua Becker at www.becomingminimalist.com. The article, “It’s better to drive an old car than be burdened by new debt”, described how the well-known economic principle of Opportunity Cost can help reduce overspending, allow someone to save more for the future and reduce stress around spending habits. Definition of Opportunity Cost from the article: “In other words, with every purchase we make, there are sacrifices we assume—alternatives that we must forgo. Every dollar spent on an item is one less dollar that could have been spent somewhere else. Of course, it is also a principle that carries weight beyond mere dollars. Because sometimes the purchases we make require us to forgo alternatives that are bigger than dollars and cents.” “In this scenario, I had to give up something potentially more valuable than dollars. I had to sacrifice calm, peace, financial freedom, and the satisfied feelings of knowing the car I drive is fully paid for.” Below are five ways to help develop a healthy mindset for spending that will help you build wealth. But first, why might you consider taking these steps? What is the reward? One of my favorite speakers, author and podcaster, Ed Mylett says to “choose your hard.” I love this idea because we get to choose to make it difficult now; workout, eat right, etc. Or we can ignore the hard decisions now and suffer the consequences later. When it comes to spending your hard-earned dollars, choose to do the hard things now so it won’t be really hard in the future when you wish you were less stressed about money, more prepared to retire early from the airlines or God-forbid, didn’t get that divorce due to financial stress. Five ways that work against us and using the economic principle of Opportunity Cost to increase financial peace of mind and happiness: 1. Be on guard against “consumerism” and know how it clouds your judgment. If billions of dollars were on the line for a corporation you owned, what lengths would you go to get people to buy your stuff? My answer would be, there are no limits. I personally believe that businesses and corporations are wonderful, they solve problems and make our lives better. However, they are also very good at convincing me that I need that new truck to be truly happy. Seriously, I’m convinced! Advertisements are powerfully designed to influence how you feel about yourself. One of the most effective tools for advertisers in our culture is to foster jealousy and envy among us. Our faulty definition of success allows marketers to pander to our weaknesses while they define our success. New car, new boat, bigger home, etc. For example, I didn’t know that if I owned a Hyundai Santa Fe that I could take my family on a grand adventure in the mountains, and we would all feel like powerful Vikings! Conquer the Weekend | Vikings | The All-New 2024 SANTA FE | Hyundai (youtube.com) No action required, just be aware that there is a battle being waged and no psychological weapon is off limits! 2. Comparison is the thief of joy! Aka Envy. President Theodore Roosevelt said it best, “comparison is the thief of joy!” If you do not know what your own values are, you will default to those of your neighbor. We always compare the worst of what we know about ourselves to the best assumptions we make about others. Take the time to discover your personal and family values. It takes intentionality and effort but remember to “choose your hard.” 3. Adopt the “A” in the WRAP Process. Chip and Dan Heath wrote a great book called, “Decisive.” In the book they wrote about how we all have a faulty process for decision-making. In fact, in one part of the book they compared the decision-making of Fortune 500 CEOs to that of a teenager. Those in the airlines have witnessed that phenomenon firsthand! They suggest a framework for decision-making called WRAP. WRAP is an acronym that stands for: Widen your options, Reality-Test Assumptions, Attain Distance Before Deciding (wait), Prepare to be Wrong. When it comes to making spending decisions, the “A” in WRAP is very powerful. Attaining distance before deciding. Wait and see if you still want that mountain cabin in six months. Is it still on your mind? This concept is akin to delayed gratification. Remember layaway! I do. That concept is long gone and not even a consideration in purchasing decisions. I recommend googling layaway and adopting the concept to help with a healthy mindset for spending and building wealth! 4. Practice gratitude. There’s power in gratitude. Every institution from science to religion produces mounds of evidence about the mental and physical health benefits of practicing gratitude. If you routinely write down what you’re grateful for you will soon realize what you really need to be fulfilled and happy may be right in front of you. Check out this great article about gratitude from Harvard Health Publishing: Giving Thanks Can Make You Happier. Excerpt from the article: “In positive psychology research, gratitude is strongly and consistently associated with greater happiness. Gratitude helps people feel more positive emotions, relish good experiences, improve their health, deal with adversity, and build strong relationships.” 5. Work towards contentment. I intentionally used the word “work” in this title because I believe that’s what we must do to become content. It doesn’t happen automatically most of the time. I also believe that contentment is a powerful state of mind that is the pinnacle of not just financial but success in life as well. Another concept I’ve learned is that just because a person has more money, they may not be more content. The best definition I could find of contentment is very simple, contentment is the state of being happy and satisfied. It is the opposite feeling of, “if I only made more money, had a bigger house, a nicer car, etc.” Furthermore, contentment does not mean you must be happy with the status quo. It doesn’t mean that you can’t strive for a higher income and nicer things. In fact, it is normal and healthy to be content and not complacent at the same time. Finally, budgeting expert Dave Ramsey says it best in his book, The Money Answer Book: Quick Answers to Your Everyday Financial Questions, author Dave Ramsey says that the most important financial principle is contentment. “You can get out of debt, save money, and get on a budget, but until your intellect forces your emotions and your spirit to accept that STUFF does not equal CONTENTMENT, your finances will always feel stressed.” P.S. Read the oldy-but-goody “Millionaire Next Door” and listen to and read anything by Ramit Sethi ~Charlie Mattingly Hopefully, you found this article interesting and helpful. If you have any questions, contact us at 865-240-2292 or Charlie@leadingedgeplanning.com Also, please tell us if we can help you on your journey to financial peace and prosperity! Click here to sign up for our newsletter or click here to schedule some time to chat about your circumstances in more detail. Also, check out our Pilot Money Guys podcast where we regularly discuss these types of financial topics along with some fun airline news updates and interesting guest interviews.  Disclaimer Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### Is a Custom-Fit Financial Plan Right for You?     “The only sensible person is my tailor. He measures me anew each time he sees me.” ~George Bernard Shaw Author:  Robert Eklund   Our lives here in the good ole USA are as varied as ice cream flavors nowadays. (Think Ben & Jerry's Marshmallow Sky or the tried-and-true Cherry Garcia). We all enjoy and prefer different hobbies, places to live, and professions. We love different people, drive different cars, and enjoy different vacations and recreations; this variety helps make life exciting! Thank God we are different; this would be a pretty dull world and nowhere close to the innovative planet we live on today if we all enjoyed the same things. Some people love science, others love art, some like flying planes, while others love finance. And some crazies actually enjoy both! The Case for Tailored Financial Plans NEWS ALERT - We are not the same, and never will be! These variations and aspirational differences make us uniquely...us. These differences illustrate why our financial plans should be more than just one-size-fits-all carbon copies. Our plans should be specifically tailored to our ambitions, values, and life goals. The term tailors use to describe a suit that fits precisely to your body and no one else's is bespoke. We know there are all kinds of suits differing widely depending on the occasion, size of the individual, the expected weather, and the budget. Nevertheless, there are articles all suits should include, such as pants, a jacket, buttons, a tie, and shoes. Similarly, our financial plans should be tailored to our circumstances, values, goals, income levels, time horizons, and risk tolerance. However, all competent, professional wealth management should include risk assessments, retirement planning, estate planning, education wishes, insurance needs, etc. Ideally, everyone would have tailored clothing. However, for many people, a bespoke suit or financial plan is outside of their budget, and an off-the-rack suit or financial plan that fits their circumstances can put them on the right path to accumulating wealth. Once assets grow and circumstances become more complex, a bespoke financial plan may make more sense than the off-the-shelf answer. Simple Plans for Simple Lives Let us take a 23-year-old minimum-wage worker living paycheck to paycheck. Let's call him "Rooster." Rooster has ambition, is disciplined, and would like to retire at age 67. He wants to live a comfortable but not extravagant life in retirement. At this point, he does not have a family or much in the way of assets or complexity. His plan may look like this: Step 1. Ensure Rooster has three-to-six months of living expenses in a high-yield savings account.Step 2. Save 15-20% of every dollar earned in a Roth IRA.Step 3. Put these dollars to work for Rooster in a low-cost target-date retirement fund for now. Step 4. After Rooster begins to see the benefits and power of compounding, talk to a fiduciary advisor about how to invest those dollars more deliberately outside of a target date fund.Step 5. Save for short-to-mid-term goals in a separate taxable brokerage account invested in a money market fund or short-term bond fund. Complex Strategies for Complex Lives Now, we will consider a 59-year-old airline captain. Let's call him Captain Maverick. Now, Maverick is married to a younger bar owner who is 49 years old. You guessed it, her name is Penny. They have one child they want to put through college and aging parents they will help care for. Maverick will retire at age 65, and Penny will retire at 55. They would like to continue their current lifestyle in retirement and aspire to travel the world. Penny wants a new Porsche 911 in retirement, and Maverick wants a new Kawasaki motorcycle and to fly his P-51 Mustang 10 hours a month. Maverick is maxing out his airline’s 401k 2023 IRS 415(c) limit of $69,000 plus his $7,500 414(v) catch-up contributions (for folks 50 and older). Luckily, Penny's bar does well because of all the drunken sailors. Unfortunately, she feels frustrated because even though her income is significantly less than Maverick’s, her income pushes their joint income into a much higher marginal tax bracket. She wonders if she should even waste her time with the bar since (seemingly) a substantial part of her income is going to the tax man! Fortunately, Penny learned that she could contribute up to $69,000 to her Solo or Individual 401k because she is a self-employed business owner. The 401k is especially beneficial since Penny can contribute a significant percentage of her self-employed income. Furthermore, she can contribute pre-tax or Roth, just like Maverick! Additionally, they both max out their after-tax IRA contributions and convert them to Roth including catch-up contributions ($7,000 for Penny, $8,000 for Maverick). They also contribute $15,000 annually to their Schwab taxable brokerage accounts using tax-efficient exchange traded funds (ETF) which can nearly mimic tax-deferred growth if invested correctly. Maverick’s airline also contributes to a Market-Based Cash Balance Plan for their pilots, approximately $16,100 per year, including 401k spillover. You might have guessed that Maverick has a Navy pension ($54,000 per year) and a military disability benefit of $12,000 per year. Preparing for a Secure Future Developing a retirement income plan would help them determine if they are on track and ensure they can prepare for unexpected life changes that come their way. Furthermore, their plan would be stress tested for potential market declines and evaluate the sequence of return risks and mitigate said risk using the Three Bucket Retirement Income strategy. Here are other beneficial strategies Maverick and Penny consider helping to simplify the complexity of their financial lives: College planning. What are the best places to save for Maverick (or Penny) Jr.’s education? What if Jr. Decides to skip college and attend a trade school or United’s Aviate program? Long-term care planning. What if one or both has the need for long-term care during their lifetime? How can they help their aging parents in this difficult area? Should they convert pre-tax dollars (401k) to Roth during retirement and before required minimum distributions begin? Tax-loss harvesting strategies may be implemented for their taxable brokerage accounts thus reducing the potential tax drag due to capital gains taxes. Utilize a risk-appropriate, diversified ETF approach to their portfolio to mitigate unseen risks to their investment strategy. Perform a thorough audit of life, liability, and health insurance needs. A tax-efficient charitable plan could be developed to maximize their philanthropic contributions. Legacy planning would be thoroughly discussed to help stabilize and solidify not only their financial futures but the future of generations to come. As you can see the Maverick-Penny Plan is significantly more complex than Rooster’s. Maverick and Penny are likely to have quite a bit of income in retirement and they do not want to risk making a big mistake with their future. The Value of Personalized Financial Advice A bespoke financial approach could add tremendous value to Penny and Maverick’s financial lives, reduce their stress, and increase their peace of mind! If you made it this far and are still awake, I thank you. As you now know, I am a fiduciary and vow to protect my clients' hard-earned money with the highest devotion to their goals. If you want to chat further about your personal financial goals or any other subject, please give me a buzz at (719) 624-7055 or shoot me an email at robert@leadgingedgeplanning.com.Until next time, I hope you have only tailwinds and blue skies! Please let us know if we can help you on your journey to financial peace and prosperity! Click here to sign up for our newsletter or click here to schedule a time to chat about your circumstances in more detail. Also, check out our Pilot Money Guys podcast, where we regularly discuss these types of financial topics along with some fun airline news updates and interesting guest interviews—even the editor and founder of Aero Crew News – Craig Pieper Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### United Airlines Pilot Long Term Disability Explained United Airlines Long Term DisabilityKevin Gormley, CFP® Andy Christopher, CFA® , lead financial planners from Leading Edge Financial Planning, discuss the details of the long-term disability plan offered by United Airlines.The key takeaways from the video are:The long-term disability benefit pays out 50% of your pay until you reach age 65, which is the mandatory retirement age for pilots.The benefit is tax-free.The company pays for 75% of the premium, with the remaining 25% being paid by the pilot after tax. There is a cap on the monthly benefit amount.The plan offers some additional benefits such as continued health insurance coverage at the active pilot rate and non-elective contributions to your 401k plan.There are different waiting periods depending on whether the disability is occupational or non-occupational.Pilots who are considering additional coverage on top of the United Airlines long-term disability plan can look into options offered by ALPA.Kevin and Andy recommend that pilots carefully consider their options and do some budgeting to see if the 50% benefit will be enough to cover their expenses in the event of a disability. They also recommend having an emergency cash fund on hand to supplement the disability income.   Note: Leading Edge Financial Planning is not affiliated with United Airlines.  This video is informational only.  Please consult an expert before making a decision.Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### If I Could Tell Every Airline Pilot One Thing… If I Could Tell Every Airline Pilot One Thing… If I could tell every airline pilot one thing it would be, save more money! I know it’s not rocket science, but like eating healthy and exercising – it’s not easy to do! As a Certified Financial Planner professional and an airline pilot myself, I understand how saving more can be a major challenge. If you’re just starting out with the airlines, you’ll make a lot more money as your career progresses but saving the right amount is never easy! I bet you won’t be surprised to know that some of these challenges are our own – new car, vacations, airplanes … In addition to our own limitations and difficulties, the IRS caps your qualified retirement contributions annually. Here, I’ll discuss three steps to maximize your savings and investing opportunities that will not only allow you to invest more now but can also greatly reduce your taxes in retirement. Every airline pilot, regardless of income, can and should contribute to their non-tax-deductible IRA. You need a taxable brokerage account in addition to your 401k and IRAs. Build tax diversification into your savings now so you’ll potentially pay less income taxes in retirement. Why save more? Many airline pilots we work with have been employed by multiple airlines in their careers. Typically, this means they have had to start over with savings and investing multiple times. Furthermore, most airline pilots at major airlines made a transition from either the regionals, corporate or military careers. Most likely, those pilots took pay cuts to make the move to their major airline of choice. There are two important takeaways from this: 1) If you are a young pilot aspiring to work at a major airline, save your money now for that eventual transition, and 2) If you are a more senior airline pilot, but because of our tumultuous industry you were late to start saving for retirement, ​simply maximizing your qualified retirement accounts may not be enough. Every airline pilot, regardless of income, can and should contribute to their non-tax-deductible IRA I’ve found that some pilots with whom I’ve flown believe they make too much money to contribute to an IRA. Not true! Many pilots misunderstand the tax rules for contributing to IRAs. It is true that most airline pilot incomes are too high to contribute to a ​tax-deductible​ IRA, as well as a Roth IRA. However, anyone, regardless of income, can contribute to a non-tax-deductible IRA. Although contributing to a non-tax-deductible IRA is beneficial, the best reason to contribute is to then convert your traditional IRA to a Roth IRA. This strategy is commonly referred to as the backdoor Roth IRA. There are no income limits on converting your traditional IRA to a Roth IRA, however there are a few things to consider before you choose to execute the backdoor Roth IRA strategy. The process of converting your traditional IRA to a Roth IRA can be simple, but make sure you are aware of the tax rules that pertain to Roth IRA conversions. For example; If you already have other IRA accounts, then all or a portion of your conversion to Roth IRA could be taxable. One strategy to possibly avoid this taxation is to consider rolling your pre-tax IRA into your company’s 401k plan and then executing the backdoor Roth IRA the following calendar year. Seek advice from your financial advisor or tax professional to make sure you follow IRS guidelines and make sure to correctly document the Roth IRA conversion on your tax return. You need a taxable brokerage account in addition to your 401k and IRAs. There is no IRS limit to how much you can save in a taxable brokerage account. You can withdraw your money anytime without penalties and there are very few limitations on your investment choices. You will not receive a tax deduction for your contributions to a taxable brokerage account, however, these accounts have other great tax advantages. Essentially, you can create your own tax deferral on the growth of your investments as well as enjoy lower capital gains tax rates if you invest using low cost exchange traded funds (ETFs), individual stocks or low-turnover stock mutual funds. Make sure to avoid short-term capital gains by holding your investments for at least one year. Once you withdraw or sell the investments in your taxable brokerage account you’ll pay capital gains tax rates which are typically lower than ordinary income tax rates for a retired airline pilot. Build tax diversification now so you’ll pay less income taxes in retirement. Sometimes we forget the entire reason for saving and investing now is to create your own paycheck during retirement. You can significantly reduce the income taxes in your retirement if you are intentional now and have a plan. Your goal should be to fill up at least three different types of investment accounts in order to increase tax diversification and potentially reduce your largest expense in retirement – taxes! 1. Pre-Tax 401k: Ordinary income tax rates upon withdrawal in retirement 2. Roth IRA and/or Roth 401k: Tax free in retirement 3. Taxable brokerage account: Capital gains tax rates Bonus savings account: If it is appropriate for your family’s health care, consider using your airline’s high deductible health care plan so you can take advantage of the health savings account (HSA). The HSA is the only account with triple tax savings. They are tax deductible, they enjoy tax-free growth, and are tax free anytime they are used for qualified medical expenses. One of your largest expenses (second only to taxes) in retirement will most likely be your healthcare expenses. Personally, I use my HSA as a healthcare 401k. Furthermore, once I turn age 65 I can use the funds from my HSA for any expenses with the understanding that I will pay ordinary income taxes on the gains if I use the funds for anything other than healthcare expenses.   Please reach out to us anytime. We’d love to hear from you because we’re here to help you navigate to your savings destination. Fly safe! 865-240-2292 info@leadingedgeplanning.com Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions. ### What is Legacy Planning and Why it Matters to You Now? Yes, I’m a Tim Mcgraw country music fan. I think at this point, he might be considered old school country music. Nonetheless, when we unpack the subject of planning for our legacy, we conclude with the idea that we must first face our own mortality.   What is it that we really want out of our lives? What purpose or cause are we excited about?   What will we look back on at “the end” that will have truly brought us joy and fulfillment "Begin with the end in mind." One of my favorite sayings is, “Begin with the end in mind.” I don’t know who said it first, but I know it’s the premise of the book “The Seven Habits of Highly Effective People” written by Stephen Covey.  When we begin with the end in mind, i.e., our own mortality, it gives us the right perspective and context around the decisions we make today. It gives us the passion and urgency to impact those around us in a positive way. It also enlightens us as to what values we would like to pass on to our children.    Legacy Beyond Financial Wealth I turn fifty years old this July 2024, and I'm starting to feel a sense of urgency about what I am passing on to the next generation. Don’t get me wrong, I’m not concerned as much about how my children will handle gobs of money when I die (not yet anyway!). On the other hand, I’m more concerned about setting them up for success and not passing on certain dysfunctions I have battled through in my life. I want my kids to be more secure in who they are than I was. I want them to know that in all situations, they are worthy, they are loved, and they are valued. You might say, these are our family values that I want to be intentional about passing on.  Furthermore, I sincerely believe that I may have been a better military and commercial airline pilot if those values had been part of my natural identity from the start. When I think about creating my family, or community legacy, these are the things I think about.   Steps to Create an Intentional LegacyThis is an article about money and finances, so how do our values fit or apply to passing on wealth?  My answer to that question is this:  If all I do is pass on financial wealth, there is a good chance my money may do more harm than good if the values I believe in are not part of my legacy as well. In essence, if I only pass on money to the next generation, I may actually set them up for failure. Passing on character, values AND financial wealth is a very difficult thing to do. In fact, most millionaires in the United States are first generation millionaires In a recent article in Business News Daily, author Stella Morrison says it this way: ”...around 68 percent of those with a net worth of $30 million or more made it themselves. Further, a second study by Fidelity investments found that 88% of all millionaires are self-made, meaning they did not inherit their wealth.”  Let’s face it, airline pilots are earning more money now than ever. Many of you will be able to pass on significant wealth to the next generation or causes you care about. Furthermore, you will leave a legacy whether you know it or not, whether it’s good or bad.  Why not take the time to make it a good one? When you’re facing the end of your time on this earth, what will you value the most? Allow those questions to guide your life right now.  Below are some practical steps and points to ponder to help you begin to think about how to proactively design your life and legacy. Because if you don’t take the time to be intentional about it, it will happen to you, and you may not like it! Define the Problem:You work your butt off to create income, wealth and a good life.  But your children probably didn’t see you overcome the obstacles and the challenges it took to get where you are. Money is not like other areas of our lives where we can expect our kids to pick up on our good habits and characteristics without significant effort and intentionality. The other day I asked a friend of mine how his son got interested in the weightlifting team at his high school. He shrugged his shoulders and commented that his son must have been influenced by seeing him and his wife work out consistently over the years. Learning about money and personal finances, on the other hand, is very different. Often families have great money habits, but if these principles and habits are not clearly communicated misperceptions can form. For example, “my parents don’t spend lavishly, therefore we must be broke.”  In this example you may have excellent money habits but unless your money values and your intentions are clearly communicated you may unintentionally pass on an attitude of scarcity versus an attitude of abundance. Here are three steps to consider if you want to be intentional about passing on your legacy:Your children may not see all the hard work and sacrifice you put in to become a high-income airline pilot. All they see is you home three to four days a week trying to catch up on house chores before you pack your bags again. “That’s not so bad...I like this airline stuff!”   1. Share your experiences, challenges and struggles with your loved ones. Consider sharing more of your experiences with your family. At the appropriate time, discuss some of the challenges you overcame to become that highly skilled, highly sought after airline pilot. Your kids may scoff (mine just laugh) at you a little when you share but they will remember you struggled and overcame obstacles.   Hopefully, when inevitable challenges come their way, they will remember that even though you struggled at times, and you were able to overcome obstacles and achieve your goals.  At least they will know enough to not expect the path to always be smooth sailing.  Unfortunately, this means we must be a bit more vulnerable and open about some of our challenges. Personally, I like to make people think it was all a breeze. That would mean that I’m smarter, tougher, stronger than I really am. That’s not what our kids need to see. 2. Communicate with your spouse, significant other or trusted friends. Often, we are creating a great legacy and positively influencing those around us without thinking about it. It may just come naturally to you.  However, for the rest of us, the first step is to literally say it out loud. What is it you want? Bring the subconscious into the conscience by discussing it with someone. I often forget that my wife doesn’t know what’s on my mind or doesn’t know what I’m trying to accomplish by talking to our kids about “who they are.” •    Better yet, write it down. There is something very powerful that happens when you write down your goals, vision for your family, or family core values.  If you search the internet, “why is writing down my goals important” you will get a slew of great articles about how you are 42% more likely to achieve your goals if you write them down.  One article from Inc.com written by Peter Economy, The Leadership Guy says, “writing your goals down not only forces you to get clear on what, exactly, it is that you want to accomplish, but doing so plays a part in motivating you to complete the tasks necessary for your success. The process of putting your goals on paper will force you to strategize, to ask questions about your current progress, and to brainstorm your plan of attack.” 3. Write down what you want people to line up to thank you for on your deathbed. A little morbid, I know. However, let's just admit that we’re all going to die someday. And all the toys you’ve accumulated will not be on your mind when that time comes. What will be on your mind? What do you want your epitaph to say? The next time you’re flying from New York to San Francisco…  •    Take some time to ponder what the top five things you want to say about yourself before you’re gone. •    Take some time to plan what you want to be remembered for, forever. •    Write down what non-financial character traits and values you would like to see in your family passed down for generations.  Is it your faith? Is it something specific to your family such as an attitude of service before self or leadership. Be intentional and plant the seeds now.   Values to Pass on to Future Generations In closing, here are a few of the values we are trying to pass on to our young children. 1.    An attitude of stewardship versus an attitude of ownership. In other words, we’ve been blessed with something (money, health, relationships) and it is our responsibility to take care of them, nurture them and hopefully bless others along the way. 2.   An attitude of generosity. Study after study shows that giving makes us happy. That’s all there is to it, so help them build habits of generosity now. 3.   An attitude of abundance versus scarcity. I believe if our kids are secure in who they are, they will not feel the need to get more for themselves at the expense of someone else. 4.   An attitude of ownership and responsibility. We want to teach our kids that it’s okay to make a mistake or even fail at something.  It’s part of the growth process. I want my kids to know they can fail and overcome the situation or face the consequences and it’s okay. If we shortcut or insulate the struggles our kids may face or go through, we cheat them out of the opportunity to find out what they really want and what they are willing to do to get it. Final Thoughts What we do now will impact multiple generations, possibly hundreds of years. Passing on financial wealth is the easiest form of capital to pass on but it can be the most destructive if we haven’t prepared the next generation to handle the responsibility of wealth.   Hopefully, you found this article interesting and helpful. If you have any questions, contact us at 865-240-2292 or Charlie@leadingedgeplanning.com. Also, please tell us if we can help you on your journey to financial peace and prosperity! Click here to sign up for our newsletter or click here to schedule some time to chat about your circumstances in more detail.  Also, check out our Pilot Money Guys podcast where we regularly discuss these types of financial topics along with some fun airline news updates and interesting guest interviews.  Even the editor and founder of Aero Crew News – Craig Pieper!   DisclaimerLeading Edge Financial Planning LLC (“LEFP”) is a registered investment advisor. Advisory services are only offered to clients or prospective clients where LEFP and its representatives are properly licensed or exempt from licensure. For additional information, please visit our website at www.leadingedgeplanning.com. The information provided is for educational and informational purposes only and does not constitute investment advice, and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor's particular investment objectives, strategies, tax status, or investment horizon. You should consult your attorney or tax advisor. The views expressed in this commentary are subject to change based on market and other conditions. These documents may contain certain statements that may be deemed forward-looking statements. Please note that any such statements are not guarantees of any future performance, and actual results or developments may differ materially from those projected. Any projections, market outlooks, or estimates are based upon certain assumptions and should not be construed as indicative of actual events that will occur. All information has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. There is no representation or warranty as to the current accuracy, reliability, or completeness of, nor liability for, decisions based on such information, and it should not be relied on as such.       ### The Tax Man Cometh - Do Not Be Afraid! “Intelligence pushes you toward the idea that complex problems require complex solutions” ~Morgan Housel, Money psychology expert* Paying taxes often causes a visceral reaction. I get it! It is probably the single most painful financial task we have to face on an annual basis. Furthermore, many of you recently received large contract bonus paychecks. For some of you, income taxes will be withheld up front and others may owe a large tax bill, due to under withholding, next April when tax-year 2024 income taxes are due.   This angry, visceral reaction causes us to go to great lengths to outsmart the tax man. Many of us seek complex solutions to avoid taxes at all costs. Unfortunately this sometimes leads to bad investment decisions or large, unwanted purchases (trucks, tractors, airplanes!) that we may not want or need, all in the name of reducing our tax bill.  Do not let the tax tail wag the dog! This is easier said than done and akin to buying high and selling low in the world of investing.   While there are effective strategies to reduce our tax burden, we should not do things that reduce our overall wealth and net worth. Avoid the Complexity Trap Pilots are known for their type-A personalities and “get ‘er done” attitude. Pilots work hard to solve problems and make things happen under very difficult circumstances. However, it is human nature to spurn the simple solution for the complex. This phenomenon is called the complexity bias. https://fs.blog/complexity-bias/  Be aware that complex tax reduction solutions often come with higher IRS audit risk as well as risks of repayment penalties and interest. Extreme cases may even warrant prison time. For some good entertainment while you are waiting on your delayed flight, simply search the internet for, “Airline Pilot Tax Fraud.”  You will find some very interesting characters doing things to evade taxes that might sound familiar and not too far fetched from some of the conversations we’ve had on the flight deck!   While we are often tempted to overcomplicate our tax strategies, especially with big-ticket purchases, it’s essential to recognize that complexity can lead to costly mistakes. Here are a few key rules to follow: Do not reduce your wealth and net worth in order to stick it to the tax man! Do not seek out complex tax strategies that are high IRS audit risks when there are several simple, audit risk-free strategies to reduce your lifetime income tax burden. Do not spend money on big-ticket items that you do not want or need in order to reduce your tax bill.  This is mathematically equivalent to spending one dollar to save thirty cents.  Reducing your income tax burden over your lifetime may be more profitable than reducing your current tax bill.   Tax Strategies Sometimes we have to choose whether to reduce taxes now or invest in strategies that could reduce our income tax burden during retirement. Unfortunately, it’s hard to imagine our future selves and what we will need, which can lead us to decisions that might benefit us today but are very costly in the future.   Below are four tax ideas that can help you legally avoid paying more taxes than you are  required to pay. But first here are three strategies that require special care and attention to detail in order to avoid gaining the attention of the IRS: Strategies that Require Special Care 1. Claiming Residency in Another State using your Condo or Crash Pad  Many high-tax states get very aggressive about going after folks that reside in their state but claim to be residents of another state. Of course there are circumstances where this is absolutely legitimate but use caution and keep extensive documentation.  You can search the internet for requirements to be an actual residence of each specific state, but here are a few that are standard in most states:  Spend 183 days or more in the state you claim to be a resident of Enroll your children in school there Register to vote Receive your mail No tiny homes… For example, New York will look at the size of your house in Florida to make sure your residence in Florida is similar in size to your captain mansion in New York. Evidently purchasing a tiny home or small condo in Florida is a tell-tale sign that you don’t spend much time there. Here is a great article from Kiplingers that goes into more detail about how to be a legitimate resident of the state of Florida.   2. Deducting Your Airplane (e.g., because you’re teaching your kid how to fly) The details of when and how to deduct airplane expenses are very complicated and beyond the scope of this article. However, here are a few things to keep in mind.   You cannot deduct the cost of your airplane (depreciation) unless it is used more than 50 % of the time for your (legitimate) business. It is not a deductible expense because you need to keep your flying ratings current. If at any time during the depreciable life of the airplane, personal use exceeds 50% there will be an immediate depreciation recapture.  (I.e., you will owe a lot of taxes all at once.) All of the excess bonus depreciation is recaptured if the business use of the property falls below 50% and also a portion of the accelerated depreciation (the excess over the straight line) is recaptured if business use falls below 50%. (Updated 09/19/24) 3. Investing in Real Estate to Deduct Losses Against Your Airline Income Remember rule number one – do not reduce your wealth to save taxes. It is not uncommon to see bad investments in real estate when high-income pilots are desperate to reduce their tax burden. In fact, it seems that we almost feel an obligation to purchase real estate solely for the tax deductions at a certain income level. I have heard many pilots confess that they must not be very tax savvy because they do have a real estate investment…or three.  Here are a few things to know before jumping into real estate investing: Over a certain income level (currently $150,000) you cannot deduct real estate losses against your airline income. For example, if you replace the roof on your rental home and therefore show a loss of $10,000 on your rental property income statement you cannot deduct the loss against your current airline income. (However, the loss can be carried over.) Note: If you are considered a Real Estate Professional, the above may not apply.  Being a real estate professional is a very high standard set by the IRS and is nearly impossible for an airline pilot to obtain unless they have a spouse, “in the business.”   Real Estate can be a great investment. However, one rule of thumb I read a long time ago is good to keep in mind; In real estate investing you need to make money on three occasions; when you buy, when you rent and when you sell. That is not easy to do! If you do not enjoy being a landlord and managing the business of real estate, I would avoid it altogether. There is no tax deduction worth making you miserable. If you plan on hiring a property management firm to delegate the pain, make sure they don’t eat into your profits too much. Some agencies can charge as much as 30% or more depending on the level of support. There are cheaper ways to invest in real estate if your costs become excessive.  (Publicly traded Real Estate Investment Trusts aka REITs)  Smart Tax Strategies for Long-Term Savings Instead of risking your financial future with complex schemes, here are four simple, effective ways to reduce your income tax burden over your lifetime. 1. Backdoor Roth IRA This strategy is based on the IRS rule that: Anyone, regardless of income, can contribute to an after-tax, non-deductible traditional IRA.   Anyone, regardless of income, can convert a traditional IRA to a Roth IRA if they pay the taxes on the gains (if any) in the traditional IRA.   There are more things to know before executing the back door Roth IRA, so make sure to consult your tax and investment advisor.  2. Health Savings Account (HSA) If you are relatively healthy and only frequent the doctor's office for preventative care and the occasional sniffles, a high-deductible health plan may be right for you. If that is the case, a Health Savings Account (HSA) is a great tax savings account. It is the only account in existence with triple tax savings: tax-deductible contributions, tax-free growth, and tax-free withdrawals for medical expenses. 3. Taxable Brokerage Accounts (non-IRA, non-401k investment account) This is the most overlooked and advantageous account once you’ve maximized your 401k and potentially the (back door) Roth IRA. The taxable brokerage account is very flexible. There are no contribution limits and no withdrawal penalties. It is taxed at capital gains tax rates, which for most of you is much lower than your income tax rate. Finally, if you invest in low-turnover mutual funds (index funds) and Exchange Traded Funds (ETFs), you can essentially create your own tax-deferred growth.  4. Real Estate Even though I bashed real estate previously, it can be great for rental income and investment diversification. People can be very successful investing in real estate if they enjoy putting in some sweat equity and managing the rentals themselves. Short-term rentals may qualify for cost segregation, bonus depreciation. Bonus Tip: Electric Vehicle Tax Credit If you’ve received a contract ratification bonus, consider purchasing an electric vehicle. If your adjusted gross income is below $300,000, you might qualify for a $7,500 federal tax credit. Tax season doesn’t have to be a burden. By avoiding unnecessary purchases and focusing on long-term strategies, you can reduce your tax burden without compromising your financial future. Stick to these principles and consult a tax professional to ensure you’re on the right track. Smart planning is key. Resources: Morgan Housel CNBC article: “Why the smartest people make bad decisions – compared to those with average IQ.”   How to establish Florida residency? Kiplingers Article Real Estate Cost Segregation Study Contact Us: Phone: 865-240-2292 Email: info@leadingedgeplanning.com Disclaimer:The information provided in this blog post is for informational purposes only and should not be considered as financial advice. Please consult a qualified financial professional for advice tailored to your specific circumstances. ### Flight #68: What To Do With Your Bonus Check What should you do with unexpected financial windfalls, such as a bonus check or unforeseen extra income? Today we answer this question and address the essential balance between celebrating your financial wins and planning for the future, sharing valuable tips to avoid financial pitfalls and the importance of building a robust emergency fund. Listen in to hear the benefits of having liquid assets and paying off debt, as well as insights into optimizing your 401(k) and leveraging real estate investment in your financial portfolio. You'll learn how to make the most of unexpected financial gains and secure a prosperous future. What You'll Learn In Today's Episode: What to do with your bonus checks. The benefit of celebrating your wins and bonuses. The importance of consulting your tax professionals. Tips to avoid getting in trouble with the IRS. Why it is essential to have an emergency fund. The importance of paying off your debt. How to maximize your 401(k). Where real estate investment can be used in your portfolio. Ideas Worth Sharing: “There is no spending like guilt-free spending.” - Robert Eklund “It is important to plan, but we can’t plan for tomorrow. We don’t know what tomorrow holds for us. So, take time to celebrate.” - Charlie Mattingly “The ability to have liquid assets is so advantageous we can’t even overstate it.” - Charlie Mattingly Resources In Today's Episode: Charlie Mattingly: LinkedIn Robert Eklund: LinkedIn   Share The Love: If you like The Pilot Money Guys podcast … Never miss an episode by subscribing via Apple Podcasts, Spotify, Google Podcasts, or by RSS! ### Flight #67: Marriage and Money: Navigating Financial Harmony Discover the secrets to a harmonious marriage and a prosperous financial life in this engaging panel discussion. Join us as we sit down with our team members at Leading Edge Planning, including Betsy Wheeler, Paraplanner, Kevin Gormley, Principal, Jon Cremer, Financial Advisor, and Nolan Clark, Paraplanner, to explore the intricate relationship between marriage and money. Listen in to learn about the common causes of financial disputes in couples, as well as how to navigate opposing spending habits. You'll gain insights into the importance of understanding your partner's financial background and the significance of setting and sharing goals. We'll also discuss the role of designated date nights, the art of compromise, and the liberating nature of a well-crafted spending plan. What You'll Learn In Today's Episode: The importance of tracking your spending How to create a spending plan. The importance of understanding where your partner's habits come from. Why you must have open communication around financial goals. How to let the little details go in marriage money conversations. The benefit of designating a night for date night. Ideas Worth Sharing: “The ultimate goal should be to spend less than you make.” - Nolan Clark “Before you ever have the budget discussion in your marriage, have the discussion about goals. A good idea of where we’re heading to is vastly more important than how much we can spend at Starbucks.” - Jon Cremer “Your spending reflects what is important to your family. So, start with your values and start with those goals and then work backward.” - Charlie Mattingly Resources In Today's Episode: Kevin Gormley: LinkedIn Charlie Mattingly: LinkedIn Betsy Wheeler: LinkedIn Nolan Clark: LinkedIn Jon Cremer: LinkedIn Share The Love: If you like The Pilot Money Guys podcast … Never miss an episode by subscribing via Apple Podcasts, Spotify, Google Podcasts, or by RSS! ### Flight #66: Flying High with Fighter Pilot Roger Lance In this episode, we have the privilege of hearing the remarkable aviation journey of Roger Lance, a retired Air Force officer and Vietnam War veteran. Roger takes us on a captivating flight through his experiences, from his early days in aviation to the intense moments in the war. He provides a glimpse into the different aircraft he piloted and shares his favorites, shedding light on the competitive yet camaraderie-filled world of flying. Roger's insights into the importance of teamwork and humility in the Air Force underscore the collaborative efforts that keep aviators soaring. Join us for an engaging conversation that offers a unique perspective on the world of high-powered aircraft and the exceptional individuals who fly them. What You'll Learn In Today's Episode: Roger’s aviation journey.  What got him interested in flying.  Which planes he was in charge of flying.  How he got into the Air Force.  His favorite plane to fly. Ideas Worth Sharing: “When flying these high-powered airplanes, you have to think you’re the best to be the best even though you are not.” - Roger Lance “Flying is really competitive. You wish everyone well, but you want to beat the other guy.” - Roger Lance “You may think you're God's gift to aviation, but the ones before you were better.” - Roger Lance Resources In Today's Episode: Thud Ridge by Jack Broughton Share The Love: If you like The Pilot Money Guys podcast … Never miss an episode by subscribing via Apple Podcasts, Spotify, Google Podcasts, or by RSS! ### Flight #65: Mastering the Art of Holistic Investing with Andy Christopher and Sunil Wahal Today we're joined by investment expert Andy Christopher, a Naval Academy graduate and F-35 Contract Instructor Pilot, and Sunil Wahal, a Professor at Arizona State University and Consultant to Avantis Investors. Together, they shed light on the intricacies of investing, emphasizing its profound connection to life itself, and the importance of self-awareness, helping you calibrate your risk tolerance and assess potential risks in your investment portfolio. Listen in as we discuss the critical aspect of diversification, particularly relevant for pilots, highlighting the lessons learned during the challenges of the COVID-19 pandemic. You will learn the art of asset allocation and its alignment with your future consumption plans, steering you toward smart investment decisions.  What You'll Learn In Today's Episode: How to think about investing more holistically. The importance of diversifying your portfolio. Why you need to assess your risks in investments. How to approach asset allocation. Why re-balancing your portfolio is key. Where private equity fits in. Why index funds may be misunderstood. Ideas Worth Sharing: “Save today to consume something in the future. That is how investing works.” - Sunil Wahal “Re-balancing makes a big difference to investors' portfolios. It is one of the most valuable things financial advisors do for their clients—it helps them so much. Done thoughtfully, it can help on the tax side as well. ” - Sunil Wahal “The best way to think about private equity is to think about what risk you are taking.” - Sunil Wahal Resources In Today's Episode: Andy Christopher: LinkedIn Sunil Wahal: LinkedIn Share The Love: If you like The Pilot Money Guys podcast … Never miss an episode by subscribing via Apple Podcasts, Spotify, Google Podcasts, or by RSS! ### Financial Thoughts on Moving to the Left Seat "Captain"   FINANCIAL IMPACT OF MOVING TO THE LEFT SEAT What are the financial implications when Pilots are upgraded from First Officer to Captain (moving to the left seat)? Mark Covell (financial planner and American Airlines pilot) and Kevin Gormley (CFP®, CPA, PFS) discuss the financial impact of the salary increase that comes when pilots get promoted.    Video referenced: lottery winners are similar to a NEW high-income person! ________ Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 12/06/2022 and are subject to change at any time due to the changes in market or economic conditions. ### Inflation: Why it's So Destructive and Why the Fed Must Kill It “While higher interest rates, slower growth, and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses” - Jerome Powell, August 26, 2022 Upon utterance of these words the equity markets promptly tanked ending the day with a cascade of selling and the S&P500 finished down over 3%. The selling continued over the next several days. Some have jokingly been referring to the Fed Chief as “President” Powell as the markets currently care little about anything else other than analyzing every word he utters for any hint as to whether theFed is dovish (lower interest rates) or hawkish (higher interest rates). Well, after hearing the above quote, market participants deemed this to be hawkish, which means it was time to sell. News reporters seemed to think the markets were waiting for a sign from the Fed that they were going to back off the rate hikes they have indicated are coming. Why they would think that when inflation (CPI) is currently running 9% year over year is beyond me. We want the Fed to raise rates. Let me explain. There is no greater drag on our collective financial futures than inflation. Even more than higher taxes or investment fees. Over the last 50 years (Aug 1972-Aug 2022), the S&P 500 has returned a nominal 10.5% CAGR (Compound Annual Growth Rate) with dividends reinvested. After adjusting for CPI, that figure drops to 6.3%. The difference in real dollar amounts is staggering. After 50 years, a $1,000 investment turned into $147,269. However, in purchasing power terms this only increased to $21,215! The average CPI over this time period was very close to 4%. Think about what 9% would do to our hard-earned dollars over any extended period of time. I want the Fed to keep raising rates, even over 4%, if necessary. Monetary policy(Fed actions)got us into this(along with some fiscal stimulus) and now must get us out. If the Fed needs to induce a recession to get inflation down, so be it. The equity markets will likely recover, and we will be much better off in the long run with lower inflation. The S&P 500 is down 20% YTD as of this writing, what if the recession is already priced in? On the topic of interest rates, I’ve had a number of clients and friends inquiring about whether they should wait for mortgage rates (currently ~5.9%) to decrease before they buy. To be blunt, this makes little sense. As mortgage rates go higher, housing prices must come down (at least on a nationwide basis). The vast majority of homes are purchased with a mortgage, and there is an upper limit on the payments that households can afford. Always remember that the maximum mortgage amount a bank will lend you is based on the monthly payments and their relation to your income, not the home price or interest rates. For example,a $500,000house with 20% down requires a $400,000 mortgage. At 3%, P&I on this home is $1,686per month. At 6%, this jumps to $2,398/month, a 42% increase! To keep payments at the original $1,686/month, the maximum mortgage amount would drop to $281,200.Combined with the original $100,000 down payment, this suggests a home price of $381,200, a decline of over 20%! I think this is very realistic, particularly in areas of the country with the highest appreciation over the last few years (think Texas, Florida, and Nevada). The bottom line is you are much better off with cheaper property at a higher interest rate than the other way around. You can always refinance later if rates come back down. If you find a house that you can afford and plan to live in for at least ten years, I wouldn’t be concerned about the interest rate but instead, focus on the purchase price.     Important Information: Leading Edge Financial Planning LLC (“LEFP”) is a registered investment advisor. Advisory services are only offered to clients or prospective clients where LEFP and its representatives are properly licensed or exempt from licensure. For additional information, please visit our website at www.leadingedgeplanning.com. The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor's particular investment objectives, strategies, tax status or investment horizon. You should consult your attorney or tax advisor. The views expressed in this commentary are subject to change based on market and other conditions. These documents may contain certain statements that may be deemed forward looking statements. Please note that any such statements are not guarantees of any future performance and actual results or developments may differ materially from those projected. Any projections, market outlooks, or estimates are based upon certain assumptions and should not be construed as indicative of actual events that will occur. All information has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. There is no representation or warranty as to the current accuracy, reliability, or completeness of, nor liability for, decisions based on such information, and it should not be relied on as such.     ### What Does Fiduciary Mean and Why is it Important?   Leading Edge Financial Planning is growing!  Thanks to you for spreading the word about Leading Edge, we're adding new advisors to increase our capacity and continue to improve the quality of our service for current and future clients.    We've been tremendously fortunate to have added three new advisors over the last few months.  Many of you already know Ben Dickinson as he's been with us for almost two years now.  However, he's moving into more of an advisory role as he's increased his knowledge base, experience and met the SEC's requirements to become an Investment Advisor Representative (IAR).    We've also added Mark Covell as an IAR.  Mark is a soon-to-be-retired Marine fighter pilot as well as an American Airlines pilot.  And yes, he's brilliant and talented in addition to being a Marine warrior for our country!    For many of you, this article may be your first introduction to Rob Eklund.  He's one of our latest additions to the team.  We're very excited to add Rob to our team of advisors because of his passion and excitement for helping people with their personal finances.  My guess is his enthusiasm will come through in this article. He tells his story of searching for a trusted, fiduciary financial advisor to help him and his family with their personal finances before becoming an IAR himself.  Click here to learn more about Rob's background and experience, and please check out his article below...  What Does Fiduciary Mean and Why is it Important The first time I heard the term "fiduciary," I said to myself, "fidu…what? Sounds fancy." Then I fell asleep. Admittedly, this topic appears boring and could put my 16-year-old boy all hopped up on Mountain Dew to sleep! But here is a wake-up call; knowing who is and who is not a fiduciary is the first step in finding someone to help you with your retirement and investment planning.    I have been interested in investing ever since I was knee-high to a grasshopper. However, I acquired this fiduciary knowledge several years ago when I was a newly minted first officer for a major airline, before becoming an investment advisor myself.  At that time, I began a journey to find a trustworthy financial advisor for myself and my family. As a military officer, money had not been a primary concern, and to be honest, I didn't have enough of it to matter. But as I began my major airline career in 2013, I realized I would soon have enough money that I had better start thinking about how to manage it. I knew I needed help. Furthermore, my focus was on learning how to be a first officer while still juggling my Air Force Reserve career.   Many questions ran through my head. The biggest and most important was, "How can I protect my money?" The money I had worked so hard to accumulate. What I found surprised me.  Many financial advisors wanting my business were not fiduciaries. Some of these advisors were very intelligent and could sell with the best. One problem, they only had a "suitable" duty of care to me versus a fiduciary standard.    The Suitability Standard  The suitability standard means an advisor or broker only had to put my money into investments they deemed adequate. They did not need to give me advice that put my interests ahead of their own.     The Fiduciary Standard  A fiduciary is someone who acts on behalf of another person and has a legal and ethical obligation to put their clients' interests ahead of their own.  SEC Chairman Jay Clayton defined the fiduciary responsibility this way, "This duty - comprised of both a duty of care and a duty of loyalty - is principles-based and applies to the entire relationship between the investment adviser and the client." When someone is a fiduciary, it applies to the "entire relationship," not parts of it. It is the highest standard in the financial world.   You may be saying, "Okay. Great! Aren't all financial advisors' fiduciaries?" Unfortunately, the term financial advisor is very nebulous and can apply to almost anyone.  In fact, most financial advisors are not fiduciaries.  Furthermore, more than half of respondents (53 percent) to a 2017 Financial Engines survey mistakenly believe that all financial advisors are already legally required to put their clients' best interests first.     Regulation Best Interest, aka "Reg BI"?  Reg BI, effective January 1st, 2020, attempted to improve upon the suitability standard and move the ethical bar higher for anyone who calls themselves a financial advisor.  Instead of only having a suitable duty, they are now supposed to have a "best interest" duty. The regulation takes several steps to raise the bar (like having to disclose conflicts of interest); however, it does not change the dynamics of how a non-fiduciary advisor operates or receives compensation.    "It is difficult to get a man to understand something when his salary depends upon his not understanding it." ~Upton Sinclair   I believe this is what Reg BI attempts to do. It tries to get brokers to act in the client's best interest, but their salary often depends on him not doing so. I fear that many advisors will continue finding ways to put clients in funds that pay them a commission. Even in the regulation itself, the term "best interest" is ill-defined and very open to interpretation.   Fee-Only versus Fee-Based  The critical distinction is that an advisor operating under Reg BI can still be paid by a 3rd party to put a client's money in certain investments or insurance products.  In other words, if an advisor gets paid by a third party (mutual fund company or insurance/annuity company) to put your money in certain investments or insurance products, then there is a conflict of interest.  And at that moment, the advisor needs to disclose that they are NOT acting in a fiduciary capacity.       Most fiduciaries operate in a "fee-only" manner.  This means the client's fees are the only source of income for the advisor, and they are not paid commissions from third parties or outside sources that could bring into question the objectivity of the advice given.  Be sure to understand the distinction between a "fee-based" financial advisor who may earn a commission and a fee versus a fee-only advisor.  The language is very nebulous and confusing for a reason.    Back to my personal journey in search of a trustworthy financial advisor; During one conversation, I asked, "Do you have a fiduciary duty to me?" What should have been a simple yes or no, was instead a bunch of hemming and hawing, but no real answer. Not to be deterred, I asked again. This time I received another vague response, so I asked once more. Finally, this advisor told me he only had a suitable responsibility (today, he would have told me he had a best interest responsibility).  Case closed! He may have been a great advisor, but he had no legal obligation to do what was best for my family and me.    I wanted my financial advisor to do what was in my highest interest. Furthermore, I wanted someone whose advice was objective and had no incentive to put me in a particular mutual fund. For me, the fiduciary advisor is the answer.   "How do you find out if someone has a fiduciary responsibility to you?" This one is easy, ask.   Ask the following question, "If I hire you as my advisor, do you always have a fiduciary duty to me?" If the answer is not a fairly quick, "Yes" I advise looking elsewhere. If it is, follow it up with this question, “To be clear, you never put on a broker hat and always have a fiduciary responsibility to me?” The answer should again be, “yes.”  Beyond asking, you should also be able to find out by looking at the disclosures on their website or looking at their Form ADV Part 2A/Firm Brochure or the new Client Relationship Statement (CRS) mandated by Reg BI.  When I became an advisor, I knew I wanted to do it the right way and act as a fiduciary for my clients.  Thankfully, Leading Edge Financial Planning (LEFP) shares this belief. Our Form ADV Part 2A says this:  Item 10: Other Financial Industry Activities and Affiliations "No LEFP employee is registered or has an application pending to register as a broker-dealer or a registered representative of a broker-dealer. LEFP only receives compensation directly from our clients. We do not receive compensation from any outside source, nor do we pay referral fees to outside sources for client referrals."   If you have gotten this far and not fallen asleep, I thank you. As you now know, I am a fiduciary and vow to protect my clients' hard-earned money with the highest devotion to their goals. Until next time, I hope you have only tailwinds and blue skies!    Robert E. Eklund, CRD # 7317768 Investment Advisor Representative  www.leadingedgeplanning.com  Robert Eklund - Financial Planner Rob is a Southwest Pilot and soon to be retired Air Force Lieutenant Colonel. He grew up working on his family’s ranch in Colorado and went to high school in Alaska.  In 2000, he graduated from the United States Air Force Academy, earning a Bachelor of Science degree in Legal Studies.  Rob has served over twenty years in the Air Force, ten years on active duty, and over ten in the Reserves. During his military career he flew the C-130 while stationed in Germany and the KC-10 in California. Rob has accumulated over 700 hours of combat flying hours and participated in multiple Operations.  He was hired by Southwest Airlines in 2013 and became a staff officer at USNORTHCOM’s Domestic Operations Division in 2016. While holding this position as an Air Planner, Rob helped areas recover from Hurricane disasters; specifically, he was called to active duty to aid in recovery efforts following Hurricane Maria. While studying at the Academy, Rob discovered his enthusiasm for the study of personal finance and investing.  As his military service comes to a close, he is excited to combine his passion for helping and protecting others with his enthusiasm for personal finance.  This culminated in 2020 with Rob passing the Series 65 Uniform Investment Advisor Law Exam and joining the Leading Edge team as a fiduciary advisor.  A fiduciary’s role comes naturally to him as he enjoys helping people whether that benefits him or not.  Rob knows the tremendous trust clients place in their financial advisors, and it is his goal to grow that trust through the highest level of transparency and integrity.  In his personal life, Rob married up to the love of his life and has been married for 18 years. He is overwhelmingly proud of his son, whom he recently donated a kidney.     Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this post will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 02/10/2021 and are subject to change at any time due to the changes in market or economic conditions. September 12, 2022 ### Don't spend a lot, to save a little on taxes! Tax Aversion Bias By Charlie Mattingly We often talk about behavioral biases, and we are constantly trying to better understand behavioral finance and behavioral economics to make better decisions. We think it’s fascinating because it can have a huge impact on our investment returns, saving habits and therefore our success in retirement. Another one of the things that it affects tremendously, believe it or not, is taxes. So how does paying taxes drive our behavior? First, let me talk about behavioral biases. What do we mean by behavioral biases? Certain parts of our brains are wired to make snap decisions to help save our lives, and sometimes this quick thinking really does save your life. What I’m referring to is the limbic system. This system is the emotional center of the brain that takes over under stress. The limbic system is the part of the brain involved in our behavioral and emotional responses, especially as it pertains to behaviors we need for survival, feeding, reproduction, caring for our young, and fight or flight responses. This system has no doubt led to our advancement and survival as a species, however it often fails when tasked with evaluating certain complex scenarios we face in modern society, especially those that are highly emotional such as our finances. So, what I wanted to do is address some of the weird things we do as taxpayers to avoid paying taxes. Of course, there’s nothing wrong with minimizing your taxes. We don’t want to pay one cent more than we’re legally required to, on the other hand, we don’t want to reduce our net worth just to minimize taxes. Unfortunately, that’s what happens a lot of the time. My father-in-law owns a lake house here in the Knoxville, Tennessee area. The house is paid off and it has appreciated significantly in value over the years. It’s a beautiful place, but they don’t want it anymore. It’s a lot of work for them to properly maintain. So, maybe selling the property would bring them more peace of mind and less stress in retirement. However, he won’t sell it. The primary reason is because he’ll have to pay taxes. What other ways has the tax aversion bias changed our behavior? Taxfoundation.org has a great article on some of these examples of tax aversion bias. Have you been to Charleston, South Carolina and noticed that the buildings are narrow and close together? That design started in Amsterdam and was copied around the world. The buildings were intentionally built to be narrow because… you guessed it, taxes. In the 16th century, buildings in Amsterdam were taxed by the width of the property’s façade and how much street frontage they took up. Real Estate Investing Another fascinating example from Paris, is the design of the Mansard-style roofs. Architects actually created rooms above the roof line because taxes were levied on the number of floors below the roof line. Mansard Roof One of these behaviors that I struggle with and think about a lot is farm equipment. I’d like to buy a new tractor and I know a lot of you probably would too. Tractors are fun! That’s why towards the end of the year I hear folks say, “Hey, I need to reduce my taxes, so I’m going to go buy a tractor. Maybe even a bigger tractor!” Again, if you need the tractor or farm equipment, that’s a different story, but don’t do things simply because it’s a tax savings. As my business partner, Kevin Gormley will tell you that’s the “tax tail wagging the dog”. In summary, taxes are a very emotional issue, and this can affect our behaviors. Sometimes we let our emotions make decisions for us, such as the example where I’m not going to pay taxes no matter what or as little as possible no matter what. Just be aware that even though its painful, sometimes it might be smarter to just pay that tax. Thank you for reading. Please reach out to us anytime. Leadingedgeplanning.com, My email is Charli@leadingedgeplanning.com. We’d love to hear from you! Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 09/06/2019 and are subject to change at any time due to the changes in market or economic conditions. Excerpt: Taxes are a very emotional issue, and this can affect our behaviors. Sometimes we let our emotions make decisions for us, such as the example where I'm not going to pay taxes no matter what or as little as possible no matter what. Just be aware that even though its painful, sometimes it might be smarter to just pay that tax. ### The Fiduciary. The Fiduciary.The first time I heard the term "fiduciary," I said to myself, "fidu…what? Sounds fancy." Then I fell asleep. Admittedly, this topic appears boring and could put my 16-year-old boy all hopped up on Mountain Dew to sleep. But, here is a wake-up call - knowing who is and who is not a fiduciary is the first step in finding someone actually to help you with your money.So, what is a fiduciary?A fiduciary is someone who acts on behalf of another person and has a fundamental obligation to put their clients' interests ahead of their own, with a duty of undivided loyalty and utmost good faith. Fiduciaries are bound both legally and ethically to act in the client's best interests.  SEC Chairman Jay Clayton defined the fiduciary responsibility this way, "This duty - comprised of both a duty of care and a duty of loyalty - is principles based and applies to the entire relationship between the investment adviser and the client."When someone is a fiduciary, it applies to the "entire relationship," not parts of it. It is the highest standard in the financial world. You may be saying, "Okay. Great! Aren't all financial advisors fiduciaries?"  I would say, "NO!"  Unfortunately, the term financial advisor is very nebulous and can apply to brokers (registered representatives), IARs (Investment Advisor Representatives), or hybrid advisors who are dual-registered and can act as both a broker and IAR. The bottom line is only IARs who are only IARs (not dual-registered) are fiduciaries always. They must do what is in your best interest, even if it hurts them. They are like financial knights, putting your kingdom before their own monetary gain.You, "Great Rob, what about Bernie Madoff? Wasn't he a fiduciary?"  You are absolutely correct!Yes, Madoff was a fiduciary advisor  (before that, he was a highly successful broker). I am definitely not saying that just because someone is a fiduciary, they will do what is best for you and your money. However, I am saying, by law, they are supposed to do precisely that (Madoff was sentenced to 150 years in federal prison). There are criminals in the world, and you need to take steps to make sure they are not defrauding you. Fortunately, many changes have taken place since Madoff and, perhaps one of the most important was the shift to a custodian system. A custodian system is where your advisor does not hold your money. Instead, a custodian like Charles Schwab retains it, and you can independently check your accounts to make sure it is where you think it is…not off in a Ponzi scheme. So, make sure your fiduciary IAR has a third-party custodian, and they don't hold your money themselves.You, "How did you gather this knowledge?"I have been interested in investing ever since I was knee-high to a grasshopper. However, I acquired this fiduciary knowledge several years ago when I was a newly minted first officer before becoming an IAR and before Reg BI (discussed below). At that time, I began a journey to find a trustworthy financial advisor for myself. As a military officer, money had not been a primary concern, and, to be honest, I didn't have enough of it to matter. But as I began my major airline career (2013), I realized I would soon have enough money that I had better start thinking about how to manage it.  I knew I needed help. My focus was on learning how to be a First Officer while still juggling my Air Force Reserve career.  Many questions ran through my head. The biggest and most important was, "How can I protect my money?" The money I had worked so hard to accumulate. What I found surprised me.  Many investment advisors wanting my business were brokers. Some of these brokers were very intelligent and could sell with the best. One problem, they only had a "suitable" duty of care to me and my money.  What does "suitable" mean? It means they only had to put my money into investments they deemed…wait for it…adequate. They did not need to give me advice that was best for me. To be clear, I am sure there are many respectable, ethical brokers out there; I am not saying there aren't. But, with a suitable standard, they had no legal obligation to do right by me and my money.  For example, say I had two financial advisors: an IAR (fiduciary) and a broker (suitable in 2013). Let us say they both had the option to put me in one of two identical funds, except one fund has higher fees. The IAR, legally, could not put me in the higher fee fund. The broker could legally put my money into the higher fee fund and likely would if they were getting paid to do so, as long as they deemed it adequate. You, "Okay, but that was then, right? What about now and Reg BI?"Regulation Best Interest (Reg BI - effective January 1st, 2020), has attempted to change the relationship and move the ethical bar higher for brokers. Instead of only having a suitable duty, they are now supposed to have a "best interest" duty. The regulation takes several steps to raise the bar (like having to disclose conflicts of interest); however, it does not change the dynamics of how a broker operates. A broker is still paid by a 3rd party to put their client's money in certain funds. This relationship has not changed. Now, however, the SEC expects them to use the client's best interest.You, "How can they do what's in my best interest if they are getting paid by someone other than me to put my money into particular funds?"Great question; you are not alone asking this. Some say Reg BI hardly moves the bar; some say it moves it a lot. Here is my take…  The regulation does not and cannot change the dynamics of how a broker operates via a 3-party exchange. The broker will still have the broker, the client, and the entity paying the broker to put the client into their particular funds (3 parties). This higher standard is potentially good, but brokers still get paid by people other than the client. IARs, on the other hand, are fee-only, meaning the client is the only one who pays them (i.e., IARs are not paid by mutual funds or companies to get you to invest with them).  Per the Investment Advisors Act of 1940, IARs have always had a higher fiduciary standard and deal with this 2-party exchange. There is the client and the IAR, that's it (2 parties). There is no incentive for an IAR to put your money into funds that may not be in your greatest interest.You, "So how are IARs paid?"Typically, IARs are paid by you quarterly. They get paid a percentage of how much money they manage for you. In the business, this is called AUM (Assets Under Management). It means, if you do well, they do well (Leading Edge charges pilots 0.85 % up to the first $1 million). So out of every $1,000 you have invested, you will pay us $8.50 per year (paid quarterly - $2.13) or less than 2 cups of Captain lattes per year (This is different from a broker who is paid to sell you a product and gets paid regardless if your money does well or not).You, "Why would I pay someone a percentage of AUM?"Well, think about having a wingman, co-pilot, or workout buddy. You are more likely to get where you want to go if you have someone helping you and encouraging you to get there. IARs help you stay the course when times get tough (Extremely wealthy people pay hedge funds similarly, but a much higher percentage of AUM). You do it because of the value you get from it.  Vanguard has studied certain financial advisors' value and determined that advisors can add 3% to the client's portfolios. This sounds like a pretty good investment to me!You, "Okay, so I pay you $8.50 per $1,000, but you can add value of $30 per $1,000?" Although this is not guaranteed, this is precisely the idea. Generally speaking, if an advisor starts guaranteeing returns, tell them you'll call them back, but our job is to add value.You, "How or why is this?"Morgan Housel (the author of The Psychology of Money) has a great point - Napoleon once said, "a genius is the man who can do the average thing when everyone else around him is losing his mind." A good advisor is someone who can help you be average when everyone else is losing their mind. If you can do this, you can make a lot of money. Good advisors help you do just that.  Think of being an airline pilot; much of our training deals with emergency training. What is the goal? To get us to do the average thing when most people are losing their minds. IARs can help instruct you through these market emergencies.Furthermore, IARs give you comprehensive financial planning. Comprehensive financial planning may include Estate Planning, Tax Planning Strategies, Risk Management, College Savings, Employee Benefits Optimization, Insurance Planning, Career Planning, and Financial Independence Planning. These services can help you sleep better at night knowing you have taken care of your future self and loved ones, which in my book is priceless.You, "So I get access to all of these types of planning with my 0.85% payments?"Yes, most IARs offer many of these services, included with your quarterly fee. If you are familiar with a retainer, this is similar. You pay quarterly fees and have access to all kinds of advice/planning all year long. At Leading Edge, all of these services, and more, are offered and are included with your quarterly 0.85% payment.In airline terms, when passengers pay for a ticket, that ticket includes deviations around thunderstorms, ATC delays, de-icing costs, etc. When you pay an advisor, you get almost all of the fixings with investment advice.You, "Sounds great, but what does fee-only mean?"Fee-only means you are paying both commission (and other custodial fees) and advisor fees. Simply put, when any trade is made establishing an investment position, there are commissions paid to brokers. Brokers make the trades but are simply the mechanism for buying and selling. In this capacity, they do not act as advisors and are not part of the decision making process. They do not get paid by the IAR and do not pay the IAR. These trades are separate from a broker selling you a product for a fee.  Now brokers giving advice, not acting as fiduciaries, may come up with all kinds of reasons why they are better for you than an IAR. It should only remind you of a quote by Upton Sinclair, "It is difficult to get a man to understand something when his salary depends upon his not understanding it."  I believe this is what Reg BI attempts to do. It tries to get brokers to act in the client's best interest, but their salary often depends on him not doing so. I fear that many brokers will continue finding ways to put clients in funds that pay the brokers. Even in the regulation itself, the term "best interest" is ill-defined and very open to interpretation. Time will tell how the SEC enforces Reg BI, but it will not change the dynamics of a 3-party (broker) relationship vs. a 2-party (IAR) relationship.  A fiduciary IAR is the highest standard and likely will be for the foreseeable future.  Reg BI does take steps to ensure brokers disclose conflicting relationships, which is a good thing. However, the fact they have to admit the relationship is irrelevant, in my opinion.  It makes me think of getting hit with a rock by a bully. His parents have come along and told him he has to tell me he is hitting me with a rock before he does it…but he can still hit me with the rock.  Understand, the bully can be quite crafty when explaining why hitting me with the rock is best for me, but I still get hit with a stone at the end of the day. Why would I sign up for that? I wouldn't, and I didn't.  Now, if you have fallen prey to some of these brokers, take comfort in knowing you aren't alone. Many hardworking people have trusted these people to do what was in their greatest interest, not knowing these brokers had no such obligation. Several studies have shown that most investors don't understand their financial advisor's duty (or lack thereof). Many people believed their brokers were always legally bound to do what was best for them. Unfortunately, this was and is not the case. Again, only IARs (Investment Adviser Representatives), who do not wear broker hats ever, have a fiduciary duty to you at all times.Back to my hunt for an advisor (pre-Reg BI)… Armed with this newfound fiduciary/suitable knowledge, I arranged a meeting with an advisor through my airline company's 401k plan.  During the conversation, I asked, "Do you have a fiduciary duty to me?"What should have been a simple yes or no, was instead a bunch of hemming and hawing, but no real answer. Not to be deterred, I asked again. This time I received another vague response, so I asked again. Finally, this advisor told me he only had a suitable responsibility (today, he would have told me he had a best interest responsibility).  Case closed. He may have been a great advisor, but he had no legal obligation to do what was right for me. If he put me in a poor investment and lost all of my money, I had very little to no recourse.         Today, instead of deeming that same investment "suitable," there will likely be brokers who find ways to make those same investments "best interest."  What I wanted was someone who had a legal obligation to me and my money. I wanted my financial advisor to do what was in my highest interest. Furthermore, I wanted someone who had no incentive to put me in a particular fund. For me, the fiduciary is the answer.  You may be saying, "Great Rob, but how do I find out if someone has a fiduciary responsibility to me?"  This one is easy.Ask the following question, "If I hire you as my advisor, do you always have a fiduciary duty to me?"If the answer isn't a fairly quick, "Yes." I advise looking elsewhere.  If it is, follow it up with, "To be clear, you never put on a broker hat and always have a fiduciary responsibility to me?"  The answer should again be, "Yes."  Beyond asking, you should also be able to find out by looking at the disclosures on their website or looking at their Form ADV Part 2A/Firm Brochure or the new Client Relationship Statement (CRS) mandated by Reg BI.When I became an advisor, I knew I wanted to do it the right way and only become an IAR (fiduciary). Thankfully, Leading Edge Financial Planning (LEFP) shares this belief. Our Form ADV Part 2A says this:Item 10: Other Financial Industry Activities and AffiliationsNo LEFP employee is registered, or has an application pending to register as a broker-dealer or a registered representative of a broker-dealer.  LEFP only receives compensation directly from our clients. We do not receive compensation from any outside source nor do we pay referral fees to outside sources for client referrals.If you have gotten this far and not fallen asleep, I thank you. As you now know, I am a fiduciary and vow to protect my clients’ hard-earned money with the highest devotion to their goals. If you want to chat further about this or any other subject, please give me a buzz at (707) 712-9387 or shoot me an email at robert@leadgingedgeplanning.com. Until next time, I hope you have only tailwinds and blue skies!Robert Eklund, Financial PlannerRob is a Southwest Pilot and soon to be retired Air Force Lieutenant Colonel. He grew up working on his family’s ranch in Colorado and went to high school in Alaska.  In 2000, he graduated from the United States Air Force Academy, earning a Bachelor of Science degree in Legal Studies.  Rob has served over twenty years in the Air Force, ten years on active duty, and over ten in the Reserves. During his military career he flew the C-130 while stationed in Germany and the KC-10 in California. Rob has accumulated over 700 hours of combat flying hours and participated in multiple Operations.  He was hired by Southwest Airlines in 2013 and became a staff officer at USNORTHCOM’s Domestic Operations Division in 2016. While holding this position as an Air Planner, Rob helped areas recover from Hurricane disasters; specifically, he was called to active duty to aid in recovery efforts following Hurricane Maria.While studying at the Academy, Rob discovered his enthusiasm for the study of personal finance and investing.  As his military service comes to a close, he is excited to combine his passion for helping and protecting others with his enthusiasm for personal finance.  This culminated in 2020 with Rob passing the Series 65 Uniform Investment Advisor Law Exam and joining the Leading Edge team as a fiduciary advisor.  A fiduciary’s role comes naturally to him as he enjoys helping people whether that benefits him or not.  Rob knows the tremendous trust clients place in their financial advisors, and it is his goal to grow that trust through the highest level of transparency and integrity.  In his personal life, Rob married up to the love of his life and has been married for 18 years. He is overwhelmingly proud of his son, whom he recently donated a kidney.Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 03/18/2021 and are subject to change at any time due to the changes in market or economic conditions. Excerpt: A fiduciary is someone who acts on behalf of another person and has a fundamental obligation to put their clients' interests ahead of their own, with a duty of undivided loyalty and utmost good faith. Fiduciaries are bound both legally and ethically to act in the client's best interests.  ### "The Envious Investor"     “My neighbor invested all of his portfolio in TESLA and now I’m envious!  It feels like I’ve FOREVER missed out.  And I might have less money in retirement because I missed the hot stock, ETF, Mutual Fund, etc.?”    “As an investor, you get something out of all the deadly sins—except for envy. Being envious of someone else is pretty stupid. Wishing them badly or wishing you did as well as they did—all it does is ruin your day. Doesn’t hurt them at all, and there’s zero upside to it."   "If you’re going to pick a sin, go with something like lust or gluttony. That way at least you’ll have something to remember the weekend for.”   Warren Buffett We understand these concerns and feelings because we’re investing for retirement too!  Furthermore, as investment advisors we hear these concerns almost every year.  If you’re a diversified investor, there will always be an asset class, a high-flying stock or mutual fund that has higher returns than your diversified portfolio.    Does this mean we’ll have less money for retirement than our neighbor who’s ONLY investment last year was TESLA?  Historical evidence says you’ll likely do just as good or better over the long-term.  The “over the long term” part of the sentence presents the challenges.  In other words, it’s really hard to be a long-term investor when it feels like the world is falling apart around you AND your drinkin’ buddies are killing it with their daily newsletter stock picks!    We all feel the pressure (envy) of missing out on great investments that we should have known were going to do better than all the others.  The good news is that diversification still works.  It’s never really “cool” nor does it ever feel great.  However, we believe, and the evidence supports the fact that your chances of success are better in the long run.  Check out the numbers from the chart below from BlackRock.      Take a look at our short video where Charlie discusses what it was like in 2020 as investor.  How challenging it can be to stay the course and not chase recent returns.  Furthermore, the difficulties of feeling like you’ve forever missed out if your returns weren’t as high as your neighbor who invested in TESLA, Bitcoin, etc.    Thank you!  Charlie & the Team at Leading Edge Financial Planning    Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 03/12/2021 and are subject to change at any time due to the changes in market or economic conditions.   ### End of Year Checklist 2020! As we near the end of another year it is always wise to review your financial situation – especially after a year like 2020! Leading Edge has created a checklist to help you evaluate your progress, maximize opportunities, and set goals for 2021. Take this opportunity to do a quick financial self-assessment. Did you meet your financial goals? Did you pay off the debts that you hoped to? Did you keep within your budget?  If not, commit to making those changes for the upcoming year. As always, we are here to help. Please reach out if we can help answer any questions or concerns. Schedule your free consultation today, 865-240-2292  Download your copy of the checklist here:  LEFP Year End Checklist 2020   Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this document will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 12/23/2020 and are subject to change at any time due to the changes in market or economic conditions. Excerpt: As we near the end of another year it is always wise to review your financial situation – especially after a year like 2020! Leading Edge has created a checklist to help you evaluate your progress, maximize opportunities, and set goals for 2021. ### What Lies Ahead? The Top Ten Investing Principles for Getting Through the Next Market Downturn, Pandemic, Recession, etc.  Not even Hollywood writers could have created a story like we lived out in 2020. In this video, Charlie Mattingly and one of Leading Edge’s newest advisors, Rob Eklund, discuss what this year has taught us, how to better prepare in the future, and thoughts about the markets and economy going forward.    Leading Edge financial advisor Rob Eklund, a First Officer for a major airline and a retired Air Force Pilot, review what investors can learn from mission planning in the Air Force and airlines.  For example, how can we be proactive instead of reactive? Many times, people may remark how pilots need quick reactions to be successful.  As Rob and I know, if you are frequently reacting as a pilot, it’s a good indication you did not plan sufficiently.  We believe it’s the same with investing and retirement planning.    Although, it is to prepare prior to a recession or market downturn, there are many things we can do during the event itself. Vanguard posted the following graphic listing just a few of the value-added strategies that are critical to consider during any market decline.     In addition to the checklist above from Vanguard, we believe there are ten essential principles to help all of us remained focused and less stressed during the next market downturn or recession.     Embrace the efficiency of the markets in the long term.      In the short term, the stock market reflects investor phycology (and many other unpredictable factors).  However, over time, equity prices tend to represent the future cash flows of a business.  We can all share in those future profits if we have the discipline to remain invested. Don’t try to outguess the market.  Although there is some debate within the finance community on the exact level of impact on investment returns, most will agree that strategic asset allocation and the amount of time in the market (not market timing) have the most considerable influence on investor returns.     Resist chasing performance.   Do not select investments based on past returns.  Funds that have outperformed in the past do not always persist as winners in the future.  Past performance alone provides little insight into a mutual fund or ETFs ability to outperform in the future.   Let markets work for you.   The financial markets have historically rewarded long-term investors.  We have the opportunity to earn an investment return that outpaces inflation by supplying capital to the companies we invest in. (I.e., stocks, mutual funds, exchange-traded funds)  Consider the drivers of returns.   Evidence shows that buying investments at a fair price (value factor), buying companies that demonstrate a consistent trend of profitability (profitability factor), and companies that tend to be smaller (small-cap premium) point to differences in expected future returns.    Practice smart diversification.   Diversification helps reduce risks that have no expected return.  Global diversification can prove beneficial over the long term while reducing the short-term volatility of a portfolio.    Avoid market timing.   You never know which market segments will outperform from year to year. Time in the market is much more profitable than attempting to time the market.    Manage your emotions.  It’s challenging to differentiate the short-term ups and downs of the market from the long-term returns needed to outpace inflation. In reality, the most significant risk we face is losing purchasing power over the long-term, during retirement, versus the risk of short-term losses in the market.    Look beyond the headlines.   There will ALWAYS be a news headline that could prevent you from investing in the stock market.  The news headlines will either attempt to scare you out of the markets or lure you into the latest investing trend.  Either strategy increases viewership, which in turn sells more commercials.    Focus on what you can control.   As we mentioned at the beginning of the article, just like pilots plan for their missions in great detail, we believe thorough planning is the best way to ensure a successful investing experience plus a fulfilling and prosperous retirement.    Please don’t hesitate to call or email us anytime.  We’d love to hear from you!  Charlie Mattingly Charlie@leadingedgefinancialplanning.com  865-240-2292  Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 12/18/2020 and are subject to change at any time due to the changes in market or economic conditions. Excerpt: Not even Hollywood writers could have created a story like we lived out in 2020. Charlie Mattingly and one of Leading Edge’s newest advisors, Rob Eklund, discuss what this year has taught us, how to better prepare in the future, and thoughts about the markets and economy going forward. ### Trust Your Instruments, Not Your Gut, When it Comes to Flying AND Investing!  ​As a brand-new pilot, one of the first things you learn is how to mitigate the risk of the potentially deadly physiological phenomenon known as spatial disorientation or spatial-D. In pilot speak, spatial-D is when your body is telling you one thing and your flight instruments (and airplane) are telling you something completely different. Sadly, spatial-D has claimed the lives of many pilots. In this video, one of our newest Leading Edge team members and previous Marine F/A-18 fighter pilot, Mark Covell discusses just one example of spatial-D.  Mark shares how carrier pilots tend to feel like they are pitching up as they are launched off the carrier at night due to the massive acceleration from the catapult. During daytime, VFR conditions this is probably a non-issue. However, in weather, or at night, this type of spatial-D is potentially deadly. What does spatial-D have to do with investing and retirement planning? Personally, I feel like all of 2020 could be compared to being catapulted off a carrier at night and not knowing what is up or what is down. During the heat of the battle from February until the markets settled a bit in early April, investor emotions were all over the place. Years of stock market gains evaporated in days, even hours. Furthermore, many people thought, and the news media quickly suggested we were headed for the second Great Depression. And don’t get me wrong, anything was (and is) possible. Sometimes, the unknown can be truly scary. One slightly humorous example of investor spatial-D was early in the pandemic when the shares of ticker symbol ZOOM shot up due to investors buying up shares as quickly as possible. Zoom Technologies, a so-called penny stock had risen more than 240% in the span of a month before the SEC suspended trading. Unfortunately, the traders failed to realize the ticker symbol ZOOM did not represent the Cloud Video Conferencing company Zoom they thought they were purchasing - Ticker symbol ZM. Here is the headline from MarketWatch.com dated February 27, 2020. In the airplane, pilots must fight spatial-D by cross-checking and TRUSTING their instruments. If, as an investor, you did not trust your instruments during 2020, it may have been very costly. So, it’s a dark night and the weather is terrible.  What are the instruments you trust?  What is your primary and backup instrument? Here are four instruments that I think can save your investments as well as your financial sanity during uncertain times... 1. Cash reserves - Emergency Funds. Having extra cash can prevent withdrawals from retirement accounts or excessive credit card debt in emergencies.  Studies also show having cash in a bank account makes people happy. In an article posted on PYMNTS.com,  "Can Cash Really Make You Happier", Joe Gladstone, research associate at the University of Cambridge in the U.K. and co-author of two recent studies about money and happiness said, "We find a very interesting effect: that the amount of money you have in your bank account right now is a better predictor of happiness than your aggregate wealth," Gladstone explained. "Having more money in their bank account makes people feel more financially secure, which leads to an increase in happiness." 2. Have a working knowledge of financial history. You don’t have to be an expert or financial historian, but I believe being familiar with financial history is akin to training before you go on a flying mission.  Pilots call this chair flying.  Athletes and musicians use a technique called visualization that helps them prepare for uncertainty and reduce anxiety for a sporting event or concert. 3. Admit that times are scary, and you do not know what’s going to happen. This may sound silly, but I’ve seen many people get themselves into a “square corner” because they assumed that something was going to happen when in fact there was no indication or possible way of knowing what the future may hold.  We have heard investors say “my gut tells me...” many times. Some of the best investors in the world invest with the mindset of preparing to be wrong. That’s why diversification is not popular or “sexy” because it’s like admitting you don’t know what’s going to happen in the future, so you must prepare for multiple scenarios.  However, diversification can feel disappointing but prove to be a profitable strategy over the long term. BlackRock Investment Management Company posted the graphic below on their investor education website about diversification and “S&P Envy” over the last 20 years. 4. Prepare and Plan by having a clear vision of your goals and priorities. If you don’t understand the “why” behind your investments as well as why you’re investing and saving in the first place, you will most likely bail-out of your plan during difficult and uncertain times.  Changing your investment plan mid-crisis creates a very high likelihood that your investment returns will be significantly lower. Simon Sinek started a movement by encouraging businesses to “Start with Why.” It’s a powerful mindset that leads to trust, inspiration and success.  I believe the same applies to your financial and investment game plan. 5. Remember that you are invested in companies – not politics. Sometimes our politics clouds the investment and retirement planning picture.  This rule falls under the axiom; “control the controllable.”  If you’re allowing your politics to affect your investment game plan than you may want to see rule number 2 above. Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 12/09/2020 and are subject to change at any time due to the changes in market or economic conditions. Excerpt: So, it’s a dark night and the weather is terrible. What are the instruments you trust? What is your primary and backup instrument? Here are five instruments that I think can save your investments as well as your financial sanity during uncertain times... ### Retirement: Everything is Different Now! You may be the type of person that enjoys managing your own investments.  And there’s nothing wrong with that.  However, as you approach or are in retirement things can be very different.  In fact, when your investment goal switches from accumulation to producing retirement income it may seem as though everything is different now!     In this video, Kevin explains why managing your own investments is different when you are retired, and why a fiduciary financial planner may be worth the investment.     Key Points: We believe a globally-diversified investment approach is still the best plan for capturing positive returns in the long run. Furthermore, chasing the top-performing asset classes and changing your portfolio based on news headlines or current events has been shown to produce lower returns over the long run.  In other words, if you find yourself wanting to change your portfolio as soon as investment headlines turn negative, having a fiduciary financial planner may help you stay focused on your goals instead of abandoning your investment plan during a downturn.     Whether you manage your investments yourself or you have a trusted advisor, here are three things everyone should do to increase your chances of success in retirement.   Write down an Investment Policy Statement to help you stay focused on your investment goals when everything in the news is negative. For example; "I will invest this way to reach my goals in retirement...." Be careful chasing the high performing asset classes. A diversified portfolio should stay diversified. Have someone who will hold you accountable in order to help you focus on your long-term goals when the going gets tough.   We appreciate your feedback! Please leave a comment on the video or reach out at https://leadingedgeplanning.com/ if you have any thoughts on the video! Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 10/31/2020 and are subject to change at any time due to the changes in market or economic conditions. Excerpt: You may be the type of person that enjoys managing your own investments. And there’s nothing wrong with that. However, as you approach or are in retirement things can be very different. ### Luck and Airline Pilot Retirement Luck and Airline Pilot RetirementHow much does luck have to do with building a successful retirement nest egg?  Consider what would happen if immediately following your retirement there is a recession.  Talk about bad luck!  Unless… you planned for it.  At Leading Edge we plan under the assumption that a recession may happen at the time of your retirement.   In this video, Charlie and Kevin discuss how to run your plan through a financial simulator in order to forecast what your financial picture might look like if the market turns south when you turn 65, and discuss what you can do NOW to insure against a “bad luck” scenario.Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 07/20/2020 and are subject to change at any time due to the changes in market or economic conditions.August 11, 2022 ### Southwest Airlines Voluntary Pilot Reduction Options: VSP and ExTO  Southwest Airlines, in an effort to reduce its workforce, has just offered pilots Voluntary Separation Pay (VSP) and Extended Emergency Time Off (ExTO). Both are generous packages (in our opinion) and an excellent option for some pilots. How do you know if it’s right for you? In this video, Kevin & Charlie discuss what is in each package, how it may affect your overall financial picture, if you can afford to take one of them, and ultimately how to decide if you should be part of the voluntary reduction.Not only are we financial planners but Charlie is a fellow SWA pilot (senior FO out of ATL). We understand what it’s like to walk in your shoes and we want to be a resource for you when it comes to making this difficult decision. Give us a chance to run your financial situation through our simulations to determine if VSP or ExTO is the right answer for you. Call us at 865-240-2292. (Please pardon our hazy image quality. We wanted to get this important message out to you quickly and used our laptop to film it, instead of our standard video equipment. Thanks for your understanding!)Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 06/04/2020 and are subject to change at any time due to the changes in market or economic conditions. ### Why Not Buy Individual Stocks? So, you want to be a stock picker? This video may make you think twice. There are stories of someone getting lucky with a homerun stock return but it’s rare.  (More than 50% of stocks do not beat their market). Kevin explains why it’s so difficult to successfully invest in individual stocks and the effect of skew. He also examines the history of investment returns when owning the top 5 stocks individually versus owning those stocks within a diversified portfolio.  The information may surprise you!Explaining Skewness (from Investopedia.com)– Skewness, in statistics, is the degree of distortion from the symmetrical bell curve in a probability distribution.– Distributions can exhibit right (positive) skewness or left (negative) skewness to varying degrees.– Investors note skewness when judging a return distribution because it, like kurtosis, considers the extremes of the data set rather than focusing solely on the average.Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 06/08/2020 and are subject to change at any time due to the changes in market or economic conditions. ### Warren Buffet Hates Airlines… So What?! Berkshire Hathaway recently sold its entire stake in Delta, Southwest, American, and United Airlines and stock prices fell after the announcement.  What is interesting is all but one out of the four of the airline’s stock prices have gone higher since the low on May 4th when Warren Buffett’s sale was made public.Stock pricing adjusts daily to numerous events.  The decision of one investor, albeit a highly successful and world-renowned investor, should not be your only guiding principle of how to handle your investments.  Mr. Buffett has had biases against investing in airlines.  Here is one of his famous quotes from the 2007 Berkshire Hathaway Annual Letter:“The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and then earns little or no money. Think airlines. Here a durable competitive advantage has proven elusive ever since the days of the Wright Brothers. Indeed, if a farsighted capitalist had been present at Kitty Hawk, he would have done his successors a huge favor by shooting Orville down.”— Warren Buffett, in the 2007 Berkshire Hathaway shareholder letterEven Warren Buffet isn’t exempt from making the occasional mistake. Time will tell if his decision to sell was the right one or not.   Individual stocks and market prices are set by the collective knowledge of all investors.  In this video, Kevin discusses how to take advantage of this collective knowledge rather than follow the few outliers who are trying to outsmart the system.August 19, 2022Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 05/21/2020 and are subject to change at any time due to the changes in market or economic conditions. ### Don’t Abandon Your Financial Plan in Response to Headlines – This is Why It’s tempting to abandon your financial plan when the world is experiencing unprecedented circumstances.  Although the pandemic is new and scary, don’t let the headlines play on your fears and knock you off your path.     History shows that recessions and recoveries are filled with short term spikes and falls. These short term events often serve as a distraction to our long term goals.  Having a financial plan and sticking with it through the ups and downs has proven time and again to give you the best chance of success.   In truth, the greater potential danger to our financial plan is not the pandemic and market volatility – it’s inflation (the loss of purchasing power in the future). If you react to the headlines and lock in your losses by withdrawing from the market you are also pulling your money from the opportunity to keep up with inflation and therefore, running out of money in retirement. Stand firm and trust your plan.  Feeling unsure?  Give us a call, 865-240-2292.Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 05/06/20 and are subject to change at any time due to the changes in market or economic conditions.May 7, 2020 ### The Shape of Economic Recovery The coronavirus has wreaked havoc on our financial markets. Now that we are settling into the chaos many economists are starting to predict what shape the recovery might look like; V, U, W, L, etc. What do those letters mean? And does it even matter HOW the economy recovers, as long as it DOES indeed recover?Kevin walks you through how those letters represent the different recession models and how each could affect your financial plan.We love getting your questions. Let us know what topics you would like us to cover. Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 04/21/2020 and are subject to change at any time due to the changes in market or economic conditions.August 22, 2022 ### 5 Things You Can Do to Prepare for This Bear Market Who could have imagined we would start with the spread of a virus, add in some political election turmoil, and now we have an OPEC price war.  Wow!Although we can’t control viruses and oil price wars, there are many things we CAN do to prepare for this bear market or recession.  Here are five things to do in order to not freak out and bring peace to your financial life:1. STOP WATCHING THE NEWS AND START READING IT.It’s important to be informed.  However, the 24-hour news cycle, selling fear and anxiety, is at an all-time high. Instead of watching TV or sensationalized videos, read your news from reputable sources. This will help reduce your emotional reaction while helping you stay knowledgeable and informed. Call us if you would like suggestions of reputable sources.2. EVALUATE YOUR PERSONAL BUDGET & BALANCE SHEET.For those of you that have very low debt and a sufficient emergency fund, you can rest easy.  Even if you’re laid off or furloughed you will have sufficient cash to prevent you from raiding your retirement funds.  If this is not you, consider the following:● Develop a spending plan to eliminate all short-term, high-interest debt as soon as possible.● Refocus your spending on necessary items only.● Increase your emergency savings through automatic payroll deductions.● Avoid new purchases unless cash is available.3. CONSIDER A REFI ON YOUR MORTGAGE.A good friend, and client, recently refinanced his mortgage to a 15-year 2.56% interest rate. This past week we saw mortgage rates fall to the lowest level in almost 50 years. That’s a game-changer for retirement planning!4. STAY IN THE FIGHT.You don’t have to be invested in 100% equities all the time, but staying in the market in some capacity is required to capture the long term market gains that are available to all of us.  It’s been shown that leaving the market only to return later may diminish your returns significantly.  In fact, if you miss out on just a few of the positive days in the market, your long-term stock averages could suffer tremendously.  You have to manage risks in the stock market – not avoid them completely. The chart below shows how $10,000 invested in the S&P 500 index, for the 20-year period of 1999 through 2018, would have performed under various scenarios.5. FOCUS ON YOUR GOALS & YOUR INVESTMENT TIME HORIZON.Remember, the money you will need in one to five years is not at risk in stocks.  It’s only a paper loss until you sell the stocks. You wouldn’t sell your house or rental real estate property just because the price declined so why would you sell your stocks?  Furthermore, more conservative portfolios recover faster from downturns than aggressive ones.  For example, according to Charlies Schwab, a portfolio with more than 70% stocks and the rest in bonds took more than two years to recover from the 2008 financial crisis, compared with just seven months for a portfolio with more than 70% in bonds and the rest in stocks.Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 03/12/2020 and are subject to change at any time due to the changes in market or economic conditions.August 26, 2022 ### How will the coronavirus affect my investment portfolio? The question everybody seems to be asking these days is: How will the coronavirus (now officially named COVID-19 by the World Health Organization) affect my investment portfolio? Of course, the unsatisfying answer is: we honestly have no idea.  You can count the unknowns.  The virus is now up to more than 73,332* cases and almost 1,870* fatalities—and counting.  But nobody knows whether the virus will eventually run rampant across the Chinese economy or burn itself out.  Nobody knows if it will spread widely beyond China and become a global crisis or remain largely confined to the Middle Kingdom.  Either way, it’s hard to predict the impact of the virus on the Chinese or global economy, much less on the U.S. and global stock markets.There are three different ways to guesstimate the impact of our latest pandemic:The first and easiest is to look at how U.S. and world markets responded to past health scares. When the public became aware of the SARS epidemic (a previous strain of the coronavirus) back in 2003, the S&P 500 index fell 14% over the subsequent two months, from mid-January to mid-March. But, according to a historical look-back by the MarketWatch economists, the market was up 20.76% a year later. The Avian flu outbreak in 2006, the Swine flu outbreak in 2009, the Ebola outbreak in 2014 and the Zika epidemic in 2016 saw initial downturns between 5.5% and 7%, but a year later, the markets had recovered by between 10 and 36 percent.We can note that the S&P 500 index fell 3% in the two weeks after January 17, when the coronavirus outbreak first made headlines. Since then, the index has bounced back to all-time highs.The second is to assess the impact that the COVID-19 outbreak is having on the Chinese economy—which, while its stocks are seldom a major part of U.S. investment portfolios, would certainly affect the world economy through disrupted supply chains and reduced demand for products and services sold by outside firms. China now makes up 15.5% of the global economy. It is a major purchaser of commodities like oil and agricultural products, and companies as diverse as smart phone makers and auto companies rely on its manufacturing output.The Chinese government is trying to contain the spread of the virus by imposing severe travel restrictions and by forcing 50 million people in affected areas to remain in their homes—which, of course, means they are not going to work and not being productive. At the same time, however, the Chinese government is pumping liquidity into its economy—an estimated 1.7 trillion yuan from the People’s Bank of China—in order to contain the economic damage it is causing with the quarantine measures. Will the two balance each other out? We can note in passing that the SARS epidemic caused a temporary 2.4% decline in Chinese production. Nobody knows if the new epidemic will have the same, greater or lesser impact.The third way to evaluate the potential damage of the pandemic is to focus on certain individual companies that are being affected by the initial phase of the outbreak. A recent U.S. News & World Report analysis singled out Carnival Corp., whose Diamond Princess cruise ship is currently quarantined at a dock just off the Japanese coastline—with 3,600 passengers onboard. More than 200 of them have come down with the coronavirus, which means that this single ship has more cases than any individual country besides China. Carnival stock is down about 17% since mid-January.The article also mentions Wynn Resorts, which has major holdings in China’s gambling Mecca of Macao. The company’s Macao resorts have been shut down by the Chinese government, causing Wynn to lose $2.6 million a day. The stock is down roughly 15% from its peak.You may not have heard of Yum China Holdings, but it is the parent company of the KFC, Pizza Hut and Taco Bell brands. The $20 billion company has had to shut down its China-based locations, and the stock has lost 15% of its market value this year.Finally, consider Nike, which has closed half of its company-owned stores and stores managed by partners in China. About 17% of the company’s revenues come from China, and Chinese factories produce about 20% of Nike products. Nike’s stock doesn’t seem to have been hammered like the other companies on this list, but you can expect a reported decline in earnings this quarter.So what does this mean? Anybody who tells you that they know how the COVID-19 epidemic will play out in American household portfolios would have to be considered a charlatan. We simply don’t know. But so far, history suggests that the market reactions to past pandemics have been temporary, just like all other kinds of market downturns. Not knowing when to get out and back into the markets constrains our options to hanging on and hoping—maybe expecting—that this time around won’t be very much different.We’re always available for your questions.  Don’t hesitate to reach out, 865-240-2292.Charlie & Kevin*As of 02/18/20 according to the World Health OrganizationPlease remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 02/15/2020 and are subject to change at any time due to the changes in market or economic conditions.Sources:Of Dollars and Data, How Will Coronavirus Affect Your Portfolio?MarketWatchUS News & World ReportCNNNasdaq.comZacksAugust 28, 2022 ### When Should an Airline Pilot Begin Taking Social Security? As an airline pilot, you may be eligible to start drawing your Social Security as soon as you retire from the airlines, but should you? As with so many things in finance, it depends. Optimizing your social security benefit is complicated and it can be confusing trying to grasp all of the moving parts. Plus, what about… ✈︎  When is your government-defined Full Retirement Age?✈︎  Will your spouse receive any benefits?✈︎  Do you anticipate retirement income from other sources?✈︎  And,… will Social Security even be around by the time I retire? (Spoiler alert: yes, we think it will.) Kevin and Charlie discuss how the answers to these questions correlate and share their 3 RECOMMENDATIONS on how to decide when is right for you to begin your benefit.We love hearing from you! Please don’t hesitate to call or email if we can help you, 865-240-2292.Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 02/10/2020 and are subject to change at any time due to the changes in market or economic conditions.August 29, 2022 ### Mandatory Pilot Retirement Age Coming Fast? Get a Plan from a Pilot Specialist Whether retirement is 5 years away or 15, it’s time to plan NOW.Are you nearing the end of your aviation career? You may not be ready to take off your epaulettes quite so soon, but the FAA currently mandates all airline pilots retire at the age of 65. Are you financially ready to make the transition?We are airline pilot specialists!The planners at Leading Edge have years of experience helping pilots from all of the major U.S. airlines grow and protect wealth so they can have as much fun in retirement as they did flying airplanes! In this video, Charlie Mattingly, Principal, CFP®, MBA and fellow airline pilot describes the value Leading Edge can bring to your financial plan.Want to skip ahead in the video? Here are the topics broken down by time marker: 00:04  How does Leading Edge Financial Planning help people execute on plans?00:36  Why is it a good time to invest TODAY vs waiting?01:12  Leading Edge helps determine if a second business or real estate is a good idea.02:33  How can Leading Edge help lessen financial emotion?03:46  Why should a pilot choose Leading Edge?04:59  Worst and best financial analogies with flying. (Just for fun!) Click HERE to book a free one-hour consultation.  Or call us at 865-240-2292.More reading:International Civil Aviation Organization (ICAO)Fair Treatment for Experienced Pilots Act Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 01/27/20 and are subject to change at any time due to the changes in market or economic conditions.January 29, 2020 ### 2019 Year-End Investment Report We have just completed the final quarter, not only of the year, but also the decade, so it’s as good a time as any to reflect back on the market behavior for the past year, and also for the past 10 years. The short version is that we have experienced a bull market for the entire ten-year period, with no -20% bear market periods and only a few 10% corrections since June 2009. People who record the history of the markets will remember that the investors of the 2010s participated in the longest bull market in American history – a totally improbable event considering that the decade came right after one of the most dramatic market setbacks in modern times.Also worth noting is how the predictors of doom were once again totally off-base. When the Federal Reserve Board stepped in to stem the worst of the Great Recession, there were widespread cries that the Fed was “printing money” in a way that would lead to massive inflation and/or the bursting of a stock market bubble. Today, an expansionist Fed is routinely criticized for being too tight, rather than too loose. Inflation, meanwhile, has ranged from 0.7% to 2.1% – which hardly signals a crisis. If you’ve noticed any bubble-bursting in the equities markets, please help us find it.By any measure, 2019 was a remarkable year for investors – and who could have guessed? Stocks went on sale in December 2018, and many were predicting that the bearish trend would continue through calendar 2019. But investors who took advantage of the lower prices or stayed the course saw well-above-average gains almost literally across the board. The markets went on sale again in August when there were reports of a very slight inversion of the yield curve in the bond markets which (it was widely reported) signaled that a recession was on the near horizon. Those rumors turned out to be false and the yield curve–that is, the difference in bond rates between short-term and long-term issues–had subsequently steepened.A breakdown shows that just about every investment asset was up strongly in 2019.  The Wilshire 5000 Total Market Index — the broadest measure of U.S. stocks — gained 9.08% in the 4th quarter, finishing the year with a hefty 31.02% gain.  The comparable Russell 3000 index was up 25.52% for the year, and has gained an average of 11.83% for the decade of the 2010s. Looking at large cap stocks, the Wilshire U.S. Large Cap index gained 9.09% in the fourth quarter, providing a 31.51% return for the year.  The Russell 1000 large-cap index finished the year with a similar 31.43% gain (averaging a 13.54% gain over the last 10-year period), while the widely-quoted S&P 500 index of large company stocks gained 8.53% during the year’s final quarter and overall finished up 28.88% in calendar 2019 – narrowly losing out to the decade’s best yearly gain of 29.6% in 2017.   Over the last ten years, investors in the S&P 500 saw annualized gains of 11.22% in the value of their holdings. Meanwhile, the Russell Midcap Index finished the 2019 calendar year up 30.54%, averaging 13.19% a year for the decade. As measured by the Wilshire U.S. Small-Cap index, investors in smaller companies posted 9.01% gains in the final quarter, to end the year with a 26.21% return.  The comparable Russell 2000 Small-Cap Index posted a 25.52% gain in 2019.   Even the foreign markets were generous to investors this year. The broad-based EAFE index of companies in developed foreign economies gained 7.81% in the final quarter, and ended the year up 18.44% in dollar terms. However, the past ten years have not been the best times to invest in international stocks; the index recorded an annualized gain of just 2.57% over that time period.  In aggregate, European stocks were up 20.03% in 2019, while EAFE’s Far East Index gained 15.46%.  Emerging market stocks of less developed countries, as represented by the EAFE EM index, were up 11.36% in dollar terms in the fourth quarter, giving these very small components of most investment portfolios a 15.42% gain for the year.  However, their 10-year track record is not enviable: up just 1.20% a year for the decade. Looking over the other investment categories, real estate, as measured by the Wilshire U.S. REIT index, posted a 1.14% loss during the year’s final quarter, but it finished the year with a 25.76% gain.  The S&P GSCI index, which measures commodities returns, gained 8.31% in the 4th quarter, to finish the year up 17.63%.  Looking back, however, commodities returns dramatically lagged U.S. stocks over the past decade: the total return for the commodities index overall was a negative 5.44%. In the bond markets, coupon rates on 10-year Treasury bonds dropped almost a full percentage point, year-on-year, to stand at 1.75% at year end.   Similarly, 30-year government bond yields have fallen from 3.01% at the beginning of the year to 2.38% coupon rates today.  Five-year municipal bonds are yielding, on average, a meager 1.14% a year, while 30-year munis are yielding 2.15% on average. It’s hard to overstate how unusual this long bull market has been in investing history.  Bear markets tend to occur about every 3.5 years, and the previous record was 9.5 years from November 1990 to March of 2000.  However, we still have a ways to go to match the 418% that was achieved in the 1990s. Longer-term, it is certain that we will experience a recession, but no person alive can predict the hour or the day.  Most economists are reluctant to predict an economic downturn when unemployment is at record lows and the slow-growth economy is chugging along with a 2.3% gain in 2019.  2020 might see a recession or at least a slowdown in growth if there is another trade conflict with China, and a shift toward rising interest rates could drive up the cost of debt servicing for corporations that are highly leveraged.  Nobody knows where the Presidential impeachment process will go from here. At the same time, dramatic increases in domestic oil production has lessened the possibility that the economy will experience an energy recession, and healthcare cost increases have moderated over the course of the decade. Similarly, nobody can predict when or how the bull market will end, how deep the coming recession or bear market will be, or, really, anything other than the fact that all past downturns were followed by upturns which took the markets and the economy to new heights. We love hearing from you!  Please don’t hesitate to call or email if we can help you, 865-240-2292.Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 01/10/2020 and are subject to change at any time due to the changes in market or economic conditions.  This article was written by a guest author.Sources:Wilshire index dataRussell index dataS&P index dataNasdaq index dataMorningstarInternational indicesCommodities index dataTreasury market ratesBond ratesInvestors.comMiami HeraldNew York IntelligencerPWCFocus EconomicsMSN ### How Financial Markets are Affected in Election Years You can’t help but notice it’s an election year, and often an election year comes with serious concern that the financial markets will go haywire. So, is this worry justified?In this video, Kevin summarizes the data of the last 90 years to uncover how the financial markets were affected during each presidential election year as well as what happened in the subsequent year. He discusses if the markets reacted differently based on which party won the election, if there are any patterns of market behavior and if you need to adjust your investment strategy in response to the election cycle.We love hearing from you! Please don’t hesitate to call or email if we can help you, 865-240-2292. Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 01/17/2020 and are subject to change at any time due to the changes in market or economic conditions.  This video was filmed in December 2019. ### Financial Lessons from Lottery Winners We have all heard the stories about the lottery winner who lost it all. How can this possibly happen?   In this video, Kevin dives into the reasons that some lottery winners don’t succeed financially. He shares the financial lessons learned from these scenarios and explains how high-income families can apply those lessons to their lives to achieve better financial outcomes and have less stress. We love hearing from you! Please don’t hesitate to call or email if we can help you.   Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 12/20/2019 and are subject to change at any time due to the changes in market or economic conditions. August 30, 2022 ### Major Changes Coming to Retirement Savings Laws (SECURE Act 2019) This past Friday the SECURE Act of 2019 passed. The act was a bipartisan effort to help Americans be better prepared for retirement. The title is an acronym: Setting Every Community Up for Retirement Enhancement and the act puts the responsibility on individuals to make plans to finance their retirement. The act contains 29 separate provisions, but we are going to share the most notable changes as outlined by a recent Surgent article.Most of these changes will increase opportunities to save for retirement. Not sure how this will affect you directly? Give us a call, we can walk you through it and see if this opens a new path for your retirement plan.Stretch IRA● Current Law: Non-spouse beneficiaries of IRAs can “stretch” minimum distributions over their own lifetime, which allows funds to grow tax-free for an extended period of time.● SECURE Act: Funds from inherited IRAs would be required to be distributed within 10 years of the IRA owner’s death.Raised Age Limit● Current Law: At age 70 ½, individuals are required to withdraw a required minimum distribution (“RMD”) each year. After age 70 ½, individuals can no longer contribute to traditional IRAs (Roth IRAs have no age limit).● SECURE Act: Individuals could wait until age 72 to begin taking RMDs, which would defer the tax impact of withdrawals and allow savings to accumulate longer. In addition, there would be no age limitation on Roth or Traditional IRA contributions.Coverage for Part-Time Employees● Current Law: Employers may exclude part-time employees from 401(k) savings plans.● SECURE Act: Employees who work 1,000 hours throughout the year or have three consecutive years of at least 500 hours of service would be eligible to participate in a 401(k) savings plan.Small Business Tax Credit● Current Law: Employers are eligible for up to a $500 credit for implementing new retirement plans.● SECURE Act: Employers could receive up to a $5,000 credit for creating new retirement plans. Additionally, a new $500 tax credit would be available to small businesses to encourage automatic enrollment in retirement plans.Multi-Employer 401(k) Plans● Current Law: It is costly and burdensome for many small businesses to offer 401(k) plans.● SECURE Act: Small business employers could join multiple-employer plans or “open MEPS,” which have reduced costs and reduced regulatory barriers, expanding access for their employees to participate in retirement savings plans.Access to Annuity Options● Current Law: Many 401(k) plans do not offer annuities due to liability concerns.● SECURE Act: Plan providers will have decreased liability concerns when offering annuities to participants of 401(k) plans.Automatic Enrollment Safe Harbor● Current Law: Employers may set a contribution rate for employees who participate in an auto-enrollment 401(k) plan. Currently, this contribution rate may not exceed 10%.● SECURE Act: Employers can raise the contribution rate to 15% for employees.Birth and Adoption Expenses● Current Law: There is a 10% early withdrawal penalty on 401(k) distributions.● SECURE Act: Following the birth or adoption of a child, married individuals could withdraw up to $5,000 from their 401(k) accounts without paying the 10% early withdrawal penalty.Expansion of 529 Plans● Current Law: Student loan repayments are not considered qualified education expenses.● SECURE Act: Funds in 529 College Savings Plans could be used to repay qualified student loan repayments, up to $10,000.Kiddie Tax● Current Law: The Tax Cuts and Jobs Act of 2017 (“TCJA”) implemented “Kiddie Tax” measures that tax unearned income of children above $2,200 at the top marginal tax rates for trusts and estates.● SECURE Act: The “Kiddie Tax” rules would revert to pre-TCJA law, in which a child’s unearned income above the threshold would be taxed at the parent’s marginal tax rate.Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video and article will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 12/20/2019 and are subject to change at any time due to the changes in market or economic conditions.August 30, 2022 ### Increase in Retirement Plan Contribution Limits for 2020  ’Tis the season for the U.S. Internal Revenue Service to make its annual inflation adjustments to a variety of tax rates and limits, including higher estate and gift tax limits for 2020.  In the coming year, individuals will be able to gift or exclude from federal estate taxes a total of $11.58 million—up from $11.4 million in 2019.  The annual gift tax exclusion—the amount you can give to heirs each year without reporting a gift—remains at $15,000.  The IRS also lifted the annual limit that can be contributed to a defined contribution (401(k) or similar) plan from $19,000 to $19,500, and people 50 or older can make catch-up additional contributions of $6,500—up from 2019’s $6,000.  The amount you can contribute to an Individual Retirement Account is unchanged at $6,000, with a $1,000 catchup limit for people 50 and older.If an employer allows after-tax contributions, or if you’re self-employed, the overall defined contribution plan limit was raised from $56,000 to $57,000.The IRS also changed the tax brackets for working Americans, raising slightly the thresholds for the 10%, 12%, 22%, 24%, 32%, 35% and 37% rates, and raised the standard deduction to $12,400—$24,800 for married people filing jointly in 2020.Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 12/13/2019 and are subject to change at any time due to the changes in market or economic conditions. This article was written by an outside source. Sources:IRA Announces Higher Estate and Gift Tax Limits for 20202020 Limitations Adjusted as Provided in Section 415(d), etc.IRS Announces Higher 2020 Retirement Plan Contribution Limits for 401(k)s and MoreThe 2020 Tax Brackets are Out.  What is Your Rate?IRS RP-19-44.pdfAugust 30, 2022 ### The Next U.S. Recession Bloomberg recently published its recession probability model. The model states that as of November 2019, the chance of a recession in the next 12 months is 26%. That sounds okay but what about this? The chances of NOT having a recession are 74%. Now that’s a pretty great number! But is this predictive model a function of the latest stock market performance or does it have real predictive power?The stock market has performed nicely in the last few months as well as year-to-date. No wonder no one is talking recession at the moment. But the truth is, the exact timing of the recessions and market downturn is unknowable. In fact, we may not even know we’ve had a recession until it’s nearly over.In this video, Charlie discusses the only surety is that we WILL have a recession sometime in the future and trying to follow the advice of prognosticators to determine when it will happen can be an expensive mistake. Ask anyone who pulled their money out of the markets in January 2019 because of the inverted yield curve. Now that’s a good predictor of recessions, right? To view the recession tracker visit: Bloomberg, U.S. Recession Chances Inch Down to 26% Within Next 12 MonthsPlease remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 12/04/2019 and are subject to change at any time due to the changes in market or economic conditions.August 30, 2022 ### No Regrets: Plan for Tomorrow so you can Live in the Moment TODAY In the last few days I learned about three fellow pilots that have lost or are losing their battles with cancer.A good friend of mine from the Air Force will be put on hospice care soon to make his last days here on earth as comfortable as possible.  His doctors recently determined he cannot handle any more chemo treatments.  It’s been four years, around 90 rounds of chemo, radiation and several surgeries.Another UPS pilot I know is battling a rare form of cancer called esthesioneuroblastoma and the stark reality of this cancer is that he will likely lose his vision entirely within 6-12 months.  Furthermore, his life expectancy is perhaps two to three more years barring a miracle.Just recently, a pilot I know passed away from cancer.  A friend of mine was by his bedside during the last moments of his life.  Fortunately, he died in peace knowing that he did all he could to make sure his family was taken care of after he was gone.  He was happy and had no regrets my friend said to me.I didn’t write all of this to depress or upset anyone.  These situations are difficult to comprehend and it’s hard to know what we can do for our friends and loved ones in these difficult moments.  I wrote this article because I know there are things our friends would want us to learn from their terrible circumstances.For starters, (and I am preaching to myself here) I think they would want us to slow down a little, spend a little more time trying to create special moments, maybe spend a little less time working and striving.  I’m very much a planner in everything I do and sometimes I struggle with being “in the moment.”  I have a fear of possibly missing out on that next achievement, the next goal, and sadly, maybe even the next dollar.  Maybe I should trade in my next three-day trip for a lesser paying “two-day” so I can see my daughter’s homecoming festivities at her school.  What is it worth in dollar numbers to see my daughter during this special moment?  Which is more valuable to her?  I’m pretty sure I know how my friends battling cancer would answer that question.Of course, there are other practical things we must do now in order to make sure that if we were in similar circumstances we could also leave this world with no regrets:1. Work to create special moments and great memories.Many people believe the quality of their relationships and memories created are a better measure of wealth than their money. I tend to agree. No one on their death bed ever wished they would have spent more time working!2. Get the appropriate amount and the right type of life insurance for your circumstances.I think it’s a safe generalization to say that most people do not have enough life insurance.  The amount of life insurance depends on several variables; your net worth, family dynamics, age, etc.  Additionally, there is rarely a need for any other type of life insurance than term life.  Do the math on the amount of life insurance you need and consult someone you can trust to help you determine what type of life insurance is right for you.3. Make sure your Last Will and Testament and your beneficiaries are up to date.A new client mentioned to me the other day, “Every time I get in the car with my wife for date night, I wonder what would happen to our kids if we died in a car accident.”  This is a terrible feeling.  Let’s not wonder anymore and make sure we clearly articulate in our will what needs to happen in case of our untimely deaths.And yes, we do know of someone that died and their ex-wife was the beneficiary on their life insurance.  “We’ll never know if that was intentional or not,” said one of the family members.4. Get a financial plan.We end almost every article we write with this advice.  The reason I think this is an important step in this context is that almost every family, including my own, struggles with the following question; “How do we balance preparing for the future and still enjoy our time now while our kids are young and we’re healthy?”Financial planning will help clarify the answer to this question.  Planning will help bring balance and confidence to our daily lives because we’ll know that we are doing our best to enjoy our time now, staying in the moment, while still giving ourselves the best chance at achieving our financial goals for the future.Finally, I am going to give up my three day trip for a two-day in order to go to my daughter’s school homecoming festivities.  It’s the right thing to do and when my time on this earth has come to an end, I want to be able to say, “I don’t have any regrets”. All the best,CharliePlease remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 11/25/2019 and are subject to change at any time due to the changes in market or economic conditions.August 30, 2022 ### The Strategy Is In the Long Game – 2019 3rd Quarter Financial Review Investing is not golf. You don’t win with your short game. The 3rd quarter of 2019 reminded us that investing requires a long game approach. Short term investors didn’t see great returns in the 3rd quarter; it was an unexciting period of time.In his quarterly review, Kevin goes over the numbers, touches on some unexpected outcomes and explains why you should invest your money for at least 10 years to ensure the highest probability of success.Further information referenced in Kevin’s video:MYTH or Fact: An Inverted Yield Curve Predicts a RecessionClick below to view the charts and data presented in this video.Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 11/07/2019 and are subject to change at any time due to the changes in market or economic conditions.August 31, 2022 ### Post-Death Planning Last week was National Estate Planning Awareness Week.  We are sharing a few articles on how to make sure your estate is in order.  Read on…Post-Death PlanningHave you ever wondered what happens to your unpaid bills after you die? You might be surprised to know that it depends on what kind of debt is still outstanding… In most cases, your estate will have enough assets to pay off all bills—assuming you have a positive net worth at the time of death. But understand that life insurance proceeds, retirement and annuity accounts and brokerage accounts are left outside the estate — and therefore cannot be forced to pay off debts. Your estate’s actual net worth may not be as great as you think it is. Your executor will review the assets and debts in your estate and prioritize the debts according to some fairly straightforward rules. Certain creditors, like those who issue medical or mortgage bills, must be paid first. A probate court will decide which remaining debts go in which priority, unless there are clear directions in your will. ???? Mortgage debt normally passes to the spouse or partner whose name is also on the loan documents, but if there is no joint mortgage holder, and the estate has insufficient funds to pay the mortgage, whoever inherits the home can usually move in and resume making the mortgage payments. The rules are different with home equity loans; with these, the bank can demand that whoever inherits the home (and the loan) immediately repay the outstanding balance. However, this is not required of the lender; in many cases, the bank will agree to let the heir continue to make the loan repayments on schedule. ???? Auto loans work similarly to mortgages; the estate handles payments if the money is available. If not, whoever inherits the car has the option to continue making payments or selling the vehicle to cover the cost of the auto loan. ???? What about credit cards? Any joint account holder is liable for the debts after the co-account holder dies. But if you’re the sole account holder, the credit card cannot go after any unpaid debts from your estate when you die. Spouses who live in community property states may or may not be liable for the outstanding debt. ????????‍???? Student loans are typically paid out of the estate, but if those funds are not available, the loan provider cannot force anyone to pay off the loans, since they are unsecured. However, if there is a co-signer for the loan, that person is liable for repaying the debt. Once again, however, a spouse in a community property estate may be liable for student loans incurred during the marriage. Many financial planners will recommend a term life insurance policy for a specified time for people who are still building their financial lives, to avoid burdening the family with debt in the event of a premature death. And of course everybody should have a will, and the will should clarify where the existing financial accounts reside, and how to access them. A little upfront planning can save having to deal with a mess later on.October 22, 2022Source:  TheStreetPlease remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning as of 10/26/2019 and are subject to change at any time due to the changes in market or economic conditions.  This article was written by an guest author. ## Pages ### Part 91/135 Pilots Part 91/135 Pilots Resources and Advice Focused for Part 91/135 Pilots and their Families How We Help Part 91/135 Pilot Families How We Help Part 91/135 pilot families often face unique financial planning challenges due to variable income, diverse employment structures, and limited access to traditional employer-sponsored benefits.Retirement savings options may include a company sponsored 401 (k), SEP IRA, SIMPLE IRA, Solo 401(k), Traditional IRA, Roth IRA, Backdoor Roth IRA, and Health Savings Account (HSA). Navigating these choices, along with insurance and other company benefits, can be complex—especially when plans vary by employer or are sourced independently.At Leading Edge, we help you understand the nuances of each option and determine which strategies best align with your financial goals. Whether you're managing fluctuating cash flow, optimizing for tax efficiency, or preparing for career transitions, we provide personalized guidance to help you execute a plan that supports both your lifestyle and long-term vision.Our team understands the aviation lifestyle and offers tailored support to help you stay financially confident through every stage of your career. Get Started Navigate Health Emergencies with Confidence Aviation professionals face unique stressors – especially when it comes to maintaining their medical certification. Even minor health issues can lead to major financial consequences if you’re not properly prepared. As aviation families ourselves, we understand the stakes and the stress. Pilots have several ways to protect their income and their families from the financial impact of health emergencies. These include: Short-term disability insurance Long-term disability insurance Loss of license coverage Accrued sick time Emergency savings We work with pilot families to evaluate their options and create a tailored plan that fits their unique needs. And when a health emergency does occur, we’re here to help you navigate the financial side—so you can focus on recovery. Resources for Part 91/135 Pilots Ready to get started? Schedule A Call ### UPS UPS Resources and Advice Focused for UPS Pilots and their Families How We Help UPS Pilot Families How We Help UPS pilot families have access to a range of retirement and health benefit options— including your pre-tax 401 (k), Roth 401 (k), and Backdoor Roth IRA. These plans come with unique contribution rules, company match structures, and strategic considerations that can be difficult to navigate alone.At Leading Edge, we help you understand the nuances of each option and make informed decisions aligned with your financial goals.Additionally, we offer investment management for your UPS 401(k) through BrokerageLink at Fidelity, helping you stay on course with your retirement strategy. Get Started Navigate Health Emergencies with Confidence Aviation professionals face unique stressors – especially when it comes to maintaining their medical certification. Even minor health issues can lead to major financial consequences if you’re not properly prepared. As aviation families ourselves, we understand the stakes and the stress. Pilots have several ways to protect their income and their families from the financial impact of health emergencies. These include: Short-term disability insurance Long-term disability insurance Loss of license coverage Accrued sick time Emergency savings We work with pilot families to evaluate their options and create a tailored plan that fits their unique needs. And when a health emergency does occur, we’re here to help you navigate the financial side—so you can focus on recovery. Resources for UPS Pilots Ready to get started? Schedule A Call ### FedEx FedEx Resources and Advice Focused for FedEx Pilots and their Families How We Help FedEx Pilot Families How We Help FedEx pilot families have access to a range of retirement and health benefit options— including your pre-tax 401 (k), Roth 401 (k), and Backdoor Roth IRA. These plans come with unique contribution rules, company match structures, and strategic considerations that can be difficult to navigate alone.At Leading Edge, we help you understand the nuances of each option and make informed decisions aligned with your financial goals.We also offer investment management for your FedEx 401(k) through BrokerageLink at Fidelity, helping you stay on course with your retirement strategy. Get Started Navigate Health Emergencies with Confidence Aviation professionals face unique stressors – especially when it comes to maintaining their medical certification. Even minor health issues can lead to major financial consequences if you’re not properly prepared. As aviation families ourselves, we understand the stakes and the stress. Pilots have several ways to protect their income and their families from the financial impact of health emergencies. These include: Short-term disability insurance Long-term disability insurance Loss of license coverage Accrued sick time Emergency savings We work with pilot families to evaluate their options and create a tailored plan that fits their unique needs. And when a health emergency does occur, we’re here to help you navigate the financial side—so you can focus on recovery. Resources for FedEx Pilots Ready to get started? Schedule A Call ### Other Airline Pilots Airline Pilots Resources and Advice Focused for Airline Pilots and their Families How We Help Airline Pilot Families How We Help Airline pilot families have access to a range of retirement and health benefit options—including a pre-tax and Roth 401 (k), Backdoor Roth, and other airline specific investment options. These plans often come with complex contribution rules, company match structures, and strategic considerations that can be difficult to navigate on your own.At Leading Edge, we help you understand the nuances of each option and make informed decisions aligned with your financial goals. With personalized guidance across retirement, health, and insurance planning, we empower you to make informed decisions that support your career and your family’s future. Get Started Navigate Health Emergencies with Confidence Aviation professionals face unique stressors – especially when it comes to maintaining their medical certification. Even minor health issues can lead to major financial consequences if you’re not properly prepared. As aviation families ourselves, we understand the stakes and the stress. Pilots have several ways to protect their income and their families from the financial impact of health emergencies. These include: Short-term disability insurance Long-term disability insurance Loss of license coverage Accrued sick time Emergency savings We work with pilot families to evaluate their options and create a tailored plan that fits their unique needs. And when a health emergency does occur, we’re here to help you navigate the financial side—so you can focus on recovery. Resources for Airline Pilots Ready to get started? Schedule A Call ### United Airlines United Airlines Resources and Advice Focused for Pilots of United Airlines and their Families How We Help United Airlines Pilot Families How We Help United pilot families have access to a range of retirement and health benefit options— including your Pilot Retirement Account Plan (PRAP) 401(k), Retiree Health Account (RHA), Health Reimbursement Account (HRA), and Profit Sharing. These plans come with unique contribution rules, company contributions, and strategic considerations that can be difficult to navigate alone.At Leading Edge, we help you understand the nuances of each option and make informed decisions aligned with your financial goals. We also guide you through United’s complex health benefit offerings to ensure your choices support both your short- and long-term needs.Additionally, we offer investment management for your United Airlines 401(k) through Schwab, helping you stay on course with your retirement strategy. Get Started Navigate Health Emergencies with Confidence Aviation professionals face unique stressors – especially when it comes to maintaining their medical certification. Even minor health issues can lead to major financial consequences if you’re not properly prepared. As aviation families ourselves, we understand the stakes and the stress. Pilots have several ways to protect their income and their families from the financial impact of health emergencies. These include: Short-term disability insurance Long-term disability insurance Accrued sick time Emergency savings We work with pilot families to evaluate their options and create a tailored plan that fits their unique needs. And when a health emergency does occur, we’re here to help you navigate the financial side—so you can focus on recovery. Resources for United Airlines Pilots Ready to get started? Schedule A Call ### Southwest Airlines Southwest Airlines Resources and Advice Focused for Pilots of Southwest Airlines and their Families How We Help Southwest Airlines Pilot Families How We Help Southwest pilot families have access to a variety of retirement savings options, including your company 401(k), Profit Sharing, 401(a), Excess Benefit, and Top Hat plans. These plans come with unique features—such as company contributions, contribution limits, and tax strategies—that can be complex to navigate. In addition, understanding Southwest’s health benefits and selecting the right insurance options adds another layer of decision-making.At Leading Edge, we help you navigate the nuances of your benefits and build a strategy that fits your financial goals—so you can make confident decisions for your future.We also offer investment management for your Southwest 401k through Schwab, helping you stay on course with your retirement strategy. Get Started Navigate Health Emergencies with Confidence Aviation professionals face unique stressors – especially when it comes to maintaining their medical certification. Even minor health issues can lead to major financial consequences if you’re not properly prepared. As aviation families ourselves, we understand the stakes and the stress. Pilots have several ways to protect their income and their families from the financial impact of health emergencies. These include: Short-term disability insurance Long-term disability insurance Loss of license coverage Accrued sick time Emergency savings We work with pilot families to evaluate their options and create a tailored plan that fits their unique needs. And when a health emergency does occur, we’re here to help you navigate the financial side—so you can focus on recovery. Resources for Southwest Airlines Pilots Ready to get started? Schedule A Call ### NetJets/EJM NetJets and Executive Jet Management (EJM) Resources and Advice Focused for NetJets / EJM Pilots and their Families How We Help NetJets and Executive Jet Management (EJM) Pilot Families How We Help NetJets/EJM pilot families have access to several retirement savings options, including your pre-tax 401 (k), Roth 401 (k), and Backdoor Roth IRA. These plans can be complex, especially when factoring in company contributions, contribution limits, and coordination with outside accounts. Navigating health insurance and other company benefits adds another layer of decision-making.At Leading Edge, we help you understand the details of each option and determine how to best align them with your financial goals. Whether you're optimizing for tax efficiency, planning for retirement, or evaluating benefit choices, we provide personalized guidance to help you make confident, informed decisions.We also offer investment management for your NetJets/EJM 401(k) through Schwab, helping you stay on course with your retirement strategy. Get Started Navigate Health Emergencies with Confidence Aviation professionals face unique stressors – especially when it comes to maintaining their medical certification. Even minor health issues can lead to major financial consequences if you’re not properly prepared. As aviation families ourselves, we understand the stakes and the stress. Pilots have several ways to protect their income and their families from the financial impact of health emergencies. These include: Short-term disability insurance Long-term disability insurance Loss of license coverage Accrued sick time Emergency savings We work with pilot families to evaluate their options and create a tailored plan that fits their unique needs. And when a health emergency does occur, we’re here to help you navigate the financial side—so you can focus on recovery. Resources for NetJets and EJM Pilots Ready to get started? Schedule A Call ### Delta Airlines Delta Air Lines Resources and Advice Focused for Pilots of Delta Air Lines and their Families How We Help Delta Air Lines Pilot Families How We Help Delta pilot families have access to several retirement savings options, including your company 401(k), Market Based Cash Balance Plan (MBCBP), and Mega Backdoor Roth. Due to the complexity of these plans, company contributions, and contribution limits, it’s important for you to understand which combination is right for your specific goals.In addition to retirement planning, we also help Delta pilot families navigate the complex health benefit options and evaluate life insurance choices—such as the Group Variable Universal Life (GVUL)—to ensure your coverage aligns with your family’s needs.At Leading Edge, we go beyond helping you understand these benefits—we guide you in executing a plan that supports your long-term goals with clarity and confidence.We also offer investment management for your Delta 401(k) through BrokerageLink at Fidelity, helping you stay on course with your retirement strategy. Get Started Navigate Health Emergencies with Confidence Aviation professionals face unique stressors – especially when it comes to maintaining their medical certification. Even minor health issues can lead to major financial consequences if you’re not properly prepared. As aviation families ourselves, we understand the stakes and the stress. Pilots have several ways to protect their income and their families from the financial impact of health emergencies. These include: Short-term disability insurance Long-term disability insurance Loss of license coverage Accrued sick time Emergency savings We work with pilot families to evaluate their options and create a tailored plan that fits their unique needs. And when a health emergency does occur, we’re here to help you navigate the financial side—so you can focus on recovery. Resources for Delta Air Lines Pilots Ready to get started? Schedule A Call ### American Airlines American Airlines Resources and Advice Focused for Pilots of American Airlines and their Families How We Help American Airlines Pilot Families How We Help American pilot families have access to a range of retirement and health benefit options—including the company sponsored 401 (k) (pre-tax and Roth), and Backdoor Roth IRA. This plan includes unique features such as company contributions, contribution limits, and in-service Roth conversions—all of which can be complex to navigate. In addition, understanding and selecting from American’s health benefit options can be equally challenging.At Leading Edge, we help you understand the nuances of each of these benefits and make informed decisions aligned with your financial goals.We also offer investment management for your American Airlines 401(k) through BrokerageLink at Fidelity, helping you stay on course with your retirement strategy. Get Started Navigate Health Emergencies with Confidence Aviation professionals face unique stressors – especially when it comes to maintaining their medical certification. Even minor health issues can lead to major financial consequences if you’re not properly prepared. As aviation families ourselves, we understand the stakes and the stress. Pilots have several ways to protect their income and their families from the financial impact of health emergencies. These include: Short-term disability insurance Long-term disability insurance Loss of license coverage Accrued sick time Emergency savings We work with pilot families to evaluate their options and create a tailored plan that fits their unique needs. And when a health emergency does occur, we’re here to help you navigate the financial side—so you can focus on recovery. Resources for American Airlines Pilots Ready to get started? Schedule A Call ### Blog Posts Welcome to the Blog Trusted insight to help you achieve your goals. Read on. Search ... Results See all results Filter Posts By Categories Select... Advocacy & Empowerment American Airlines Budgeting & Debt Management Career & Income Delta Air Lines Estate Planning FedEx Health and wellness High Income Earners Insurance & Risk Management NetJets/EJM Other Airline Pilots Other Part 91/135 Pilots Pilot Money Guys Purpose & Goals Quarterly Reviews Saving & Investing Southwest Airlines Taxes United Airlines UPS Who We Help Select... Airline Select... American Airlines Delta Air Lines FedEx High Income Earners NetJets/EJM Other Airline Pilots Other Part 91/135 Pilots Southwest Airlines United Airlines UPS ### Explore Schedule A Consultation Let's start the conversation. Book A Free Call We’d love to learn more about your financial goals and how we can help you achieve them. Schedule a complimentary consultation with one of our advisors to discuss your current situation, explore our planning process, and see if we’re the right fit for your needs. Our consultations are designed to give you clarity and direction — no pressure, no obligation. Simply choose a time that works best for you below. Already a client? Schedule here. Charlie Mattingly, CFP®, MBA If you have a time-sensitive issue, please call me directly at 865-328-4969 Book Now Kevin Gormley, CFP®, CPA, PFS If you have a time-sensitive issue, please call me directly at 865-217-7779 Book Now Andrew Christopher, CFA®, MSF If you have a time-sensitive issue, please call me directly at 901-664-3753 Book Now Nolan Clark, CFP®, B.S. (Finance) If you have a time-sensitive issue, please call me directly at 270-545-5880 Book Now ### Careers Careers Explore employment opportunities at Leading Edge Financial Planning. Current Openings See Full Job Description Apply Now See Full Job Description Apply Now Our Core Values At Leading Edge Financial Planning, we believe in a better approach to objective financial advice. Using a fee-only, no-commission business model focused specifically on meeting your goals, we provide unbiased fiduciary advice that is at all times in your best interest. Authenticity We bring our whole selves, act with integrity, and let our genuine care show in every client interaction.  Service We put others first, serving teammates and clients alike with humility and a servant’s heart.  Humility We recognize our strengths and limitations, always seeking to learn so we can better support each other and those we serve.  Abundance We choose optimism and gratitude, sharing generously with our clients and one another. Excellence We hold ourselves to the highest standards in every detail, striving for expertise so clients receive our very best. Ready to get started? Schedule A Call ### High-Income Individuals High-Income Individuals and Families Take control of your financial future. How We Help We turn your financial success into a comfortable and secure lifestyle. We understand and appreciate how hard you’ve worked to achieve success and accumulate wealth. But there’s a difference between high income and high net worth. You need a financial partner who can translate your income into a comfortable and secure lifestyle. At Leading Edge Financial Planning, we help you gain control over your financial planning, investments and taxes. We Understand Your Unique Financial Challenges... High tax obligations that gnaw away at your earnings A limited number of earning years Multiple financial priorities competing for your income A busy life that allows little time for financial planning The stress of unexpected situations that may derail your earning ability A Tax-Efficient Portfolio to Help Maximize Your Net Worth Did you know that if you earn more than $200,000 per year, taxes are likely your highest expense? If you’re not viewing every financial decision through a tax-efficient lens, you’re probably paying too much to Uncle Sam.At Leading Edge Financial Planning, our in-house CPA helps identify tax savings opportunities across all of your accounts and investments, and we incorporate a variety of tax strategies into your customized financial plan. We also work with your personal accountant to help ensure these strategies are integrated into your annual tax return. Our process is as follows: Step One We start by gaining an understanding of your current investments and their tax status. We identify which investments are considered tax preferred and which are subject to high tax rates.  Step Two Based on your specific financial situation, we determine whether it makes sense to put more assets in tax-deferred accounts or keep assets in the taxable accounts. Tax-deferred accounts may include traditional IRAs, Roth IRAs, 529 plans and low-cost variable annuities.  Step Three Our strategy is to minimize your tax obligations by putting tax-heavy assets into tax-deferred or tax-free accounts and tax-preferred assets into taxable accounts. Step Four We maximize the utilization of low-turnover strategies within taxable accounts. A mutual fund or ETF with a high turnover rate may provide a decent return, but that often comes with a high tax obligation. Passively managed index funds and EFTs can provide tax efficiencies in taxable accounts. Step Five Next, we consider tax-preferred investments such as master limited partnerships, municipal bonds and rental real estate, which can help offset investment income and provide a tax depreciation shield.  Step Six We incorporate charitable giving strategies to maximize both your deduction and the amount received by the charity.  Ready to get started? Schedule A Call ### Commercial Pilots Professional Pilots We help pilots create, grow and protect wealth so they can have as much fun in retirement as they did flying airplanes! How We Help We are uniquely positioned to help you navigate the challenges of your profession because we face the same challenges. Our experienced professionals help pilots navigate the unique challenges of their professional and personal lives. Our team includes fellow pilots and advisors with direct connections to the aviation community — from pilot spouses to former military aviators — who provide genuine insight into the lifestyle, income and career path obstacles you face in achieving your financial goals. Your financial plan is designed with the following challenges in mind: Uncertain Industry The industry uncertainty facing pilots makes it absolutely vital to have a financial plan in place. We help you plan for multiple scenarios by implementing tax-efficient investment and asset protection strategies in order to provide you with the confidence of knowing your family has planned for the unexpected. Mandatory Retirement Because pilots face a mandatory retirement age of 65, there’s no option to extend your flying career if you realize too late that your savings aren’t enough. We focus on accelerating your retirement savings with this end date in mind. Our goal is to help you establish a lifetime income stream to support your desired lifestyle in retirement and provide a financial legacy for those who matter most. Medical Certification Requirements You may face losing your job if you are diagnosed with a disqualifying medical condition during your annual FAA medical examination. Unfortunately, disqualifying conditions occur frequently and often catch pilots unprepared. We offer solutions to support your family in the event of an unexpected medical condition. High Income High-income earners have unique financial considerations related to tax planning, estate planning, saving and investing. We help maximize your savings and investments while considering how any decisions impact your tax and estate planning. Our goal is to help you maintain your desired lifestyle, both today and long into the future. Limited Time You spend much of your time in the air and away from family and friends. This makes your time with loved ones a precious commodity. Don’t waste it worrying about your finances. Let Leading Edge Financial Planning serve as your partner in planning for your financial future.  Ready to get started? Schedule A Call ### Links Schedule a Time to Chat Take the Pilot Wealth Index Quiz Read Before Fly Newsletter Leading Edge YouTube The Pilot Money Guys Podcast The Pilot Money Guys Podcast (Spotify) The Pilot Money Guys Podcast (Apple podcasts) Pilot Money Guys Instagram Pilot and High-Income Blog Submit a Suggestion ### Newsletter Email ### Subscribe ### Team ### Legal Disclosures Legal Disclosures Important DisclaimersLeading Edge Financial Planning, LLC (“LEFP”) is a Registered Investment Advisor (“RIA”) located in the State of Tennessee. LEFP provides investment advisory and related services for clients nationally. LEFP will maintain all applicable registration and licenses as required by the various states in which LEFP conducts business, as applicable. LEFP renders individualized responses to persons in a particular state only after complying with all regulatory requirements or pursuant to an applicable state exemption or exclusion.Terms of UsePlease read these terms and conditions of use (“Terms”) carefully before using the website located at https://leadingedgeplanning.com/ (“Website”) or any of the information or services provided by LEFP (collectively “LEFP,” “we,” “our,” “us”) in connection with the website. By using the website, you acknowledge that you have read and understood these Terms and accept to be legally bound by them. If you do not accept and agree to these Terms, you are not an authorized user of the website or any of the information or services provided by LEFP in connection with the website and should promptly terminate all use thereof. The terms “you” and “your” mean you and any entity you may represent in connection with the use of the website. You may use your browser to download or print a copy of these Terms for your records.LEFP reserves the right to change, modify, add or remove portions of these Terms at any time for any reason. We suggest that you review these Terms periodically for changes. Such changes shall be effective immediately upon posting. You acknowledge that by accessing our website after we have posted changes to these Terms, you agree to these Terms as modified.These Terms were last updated on 11/21/2023.Risk DisclosureDifferent types of investments involve varying degrees of risk. Therefore, it should not be assumed that the future performance of any specific investment or investment strategy will be profitable.Asset allocation may be used in an effort to manage risk and enhance returns. It does not, however, guarantee a profit or protect against loss. The performance of the asset allocation strategies depends on the underlying investments.This website is intended to provide general information about LEFP and its services. It is not intended to offer or deliver investment advice in any way. Information regarding investment services is provided solely to gain an understanding of our investment philosophy and our strategies and to be able to contact us for further information.Market data, articles, and other content on this website are based on generally-available information and are believed to be reliable. LEFP does not guarantee the accuracy of the information contained on this website. The information is of a general nature and should not be construed as investment advice.Please remember that it remains your responsibility to advise LEFP, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services.LEFP will provide all prospective clients with a copy of our current Form ADV, Part 2A (“Disclosure Brochure”), Form ADV Part 2B, which is the Brochure Supplement for each advisory person supporting a particular client, and the Form ADV Part 3 (“Client Relationship Summary” or “Form CRS”). You may obtain a copy of these disclosures on the U.S. Securities and Exchange Commission’s (“SEC”) website at https://adviserinfo.sec.gov/firm/summary/27714, or you may Contact Us to request a free copy via .pdf or hardcopy.Privacy DisclosuresLEFP is committed to safeguarding the use of the personal information of our Clients (also referred to as “you” and “your”) that we obtain as your Investment Advisor, as described in our Privacy Policy.LEFP does not collect personal nonpublic information through this website; however, the Advisor may collect information from you on application forms, agreements, profile or investment policy statements, and other documents received or processed in relation to services we provide. We also may collect information from other sources.We do not respond to “do not track” requests because we do not track you over time or across third-party websites to provide targeted advertising. We may track you across our website to help us improve our content.We may use “cookies” and similar online technologies to keep and sometimes track information about you regarding your usage of our website. Cookies are small data files sent to your browser or related software from a Web server and stored on your device. Cookies help us to collect information about your usage of our website, including date and time of visits, pages viewed, amount of time spent on our sites, or general information about the device used to access the site, such as the browser used. You can refuse to store or delete cookies by configuring your web browser settings. Most browsers and mobile devices have their own settings to manage cookies. If you refuse a cookie when on our website or delete cookies, you may experience some inconvenience in using our website, such as having to re-configure preferences.When you are on this website, you may have the opportunity to click through to other websites, including websites operated by unaffiliated third parties. These sites may collect nonpublic personal information about you. We do not control sites operated by these entities and are not responsible for the information practices of these sites. This Privacy Policy does not address the information practices of other websites. The privacy policies of websites operated by third parties are located on those sites.For a copy of the LEFP Privacy Policy, please Contact Us.Email DisclosuresLEFP often communicates with its clients and prospective clients through electronic mail (“email”) and other electronic means. Your privacy and security are very important to us. LEFP makes every effort to ensure that email communications do not contain sensitive information. We remind our clients and others not to send LEFP private information over email. If you have sensitive data to deliver, we can provide secure means for such delivery.PLEASE NOTE: LEFP does not accept trading or money movement instructions via email.As a registered investment advisor, LEFP’s emails may be subject to inspection by the Chief Compliance Officer (“CCO”) of LEFP or the securities regulators.If you have received an email from LEFP in error, we ask that you contact the sender and destroy the email and its contents.If you have any questions regarding our email policies, please Contact Us.Social WebsitesLEFP may utilize third-party websites, including social media websites, blogs, and other interactive content. LEFP considers all interactions with clients, prospective clients, and the general public on these sites to be advertisements under the securities regulations. As such, LEFP generally retains copies of information that LEFP or third parties may contribute to such sites. This information is subject to review and inspection by the CCO of LEFP or the securities regulators.Information provided on these sites is for informational and/or educational purposes only. It is not, in any way, to be considered investment advice nor a recommendation of any investment product. Advice may only be provided by LEFP’s advisory persons after entering into an advisory agreement and providing LEFP with all requested background and account information.If you have any questions regarding our policies, please Contact Us. ### Single New ### Client Resources Client Resources Pilot Money Guys Podcast Podcast Spotify Youtube The Blog Trusted insight to help you achieve your goals. Read on. Pilot Wealth Index Quiz Discover personalized insights for achieving financial freedom. Read Before Fly Newsletter Take control of your financial plan. Get our latest tips and strategies. Schedule A Time To Chat Click here to book a client meeting. Leading Edge Tax Planning Click here to visit our Tax Planning website. Schedule A Call Ready to get started? Schedule A Call ### Pricing Pricing Simplified and transparent compensation methods to match your needs Fees and Expenses The financial industry has made fees mysterious and sometimes impossible for clients to discern. It’s very simple; if fees are not absolutely transparent you are probably paying too much. The method of compensation should be clear to you before you sign our financial planning agreement. Blended Rate Fee Structure Managed Assets Annual Rate $1 – $250,000 1.00% $250,001 – $1,000,000 0.95% $1,000,001 – $2,000,000 0.85% $2,000,001 – $3,000,000 0.75% $3,000,001 – $5,000,000 0.65% $5,000,001 – $7,000,000 0.55% $7,000,001 and Above Negotiable Our wealth management services include both financial planning and investment management. Fees are based on a percentage of the assets we directly manage, using a tiered rate system. This means different portions of your assets are charged at varying rates, with higher asset levels benefiting from lower rates. The annual fee is divided into quarterly payments for convenience. We generally require a minimum annual fee of $2,400 to effectively deliver our services. Ready to get started? Schedule A Call ### FAQs Frequently Asked Questions Considering a Financial Adviser? Here are some great questions we can help you answer. What You Need to Know Before Choosing an Investment Adviser The Securities and Exchange Commission (SEC) receives many questions about investment advisers—what they are and how to go about choosing one. This page answers some of the typical questions we receive from investors about investment advisers. This Q&A is for the benefit of investors. You should not rely on it to determine if you need to register as an investment adviser. What is an investment adviser? An investment adviser is an individual or a firm that is in the business of giving advice about securities to clients. For instance, individuals or firms that receive compensation for giving advice on investing in stocks, bonds, mutual funds, or exchange traded funds are investment advisers. Some investment advisers manage portfolios of securities What is the difference between an investment adviser and a financial planner? Most financial planners are investment advisers, but not all investment advisers are financial planners. Some financial planners assess every aspect of your financial life—including saving, investments, insurance, taxes, retirement, and estate planning—and help you develop a detailed strategy or financial plan for meeting all your financial goals. Others call themselves financial planners, but they may only be able to recommend that you invest in a narrow range of products, and sometimes products that aren’t securities. Before you hire any financial professional, you should know exactly what services you need, what services the professional can deliver, any limitations on what they can recommend, what services you’re paying for, how much those services cost, and how the adviser or planner gets paid. What makes financial planning for pilots different from other professions? Pilots face unique challenges such as mandatory retirement age, fluctuating industry stability, and strict medical certification requirements. These factors require specialized planning to protect your long-term financial goals. How are you compensated for your services? We are a fee-only fiduciary firm, which means we are paid directly by our clients for our advice. We do not earn commissions or have hidden agendas—our advice is always in your best interest. What does it mean that you are a fiduciary? As fiduciaries, we are legally and ethically bound to put your interests first. Every recommendation we make is focused on helping you achieve your goals, not ours. What is your financial planning process like? We follow a proven step-by-step process: understanding your goals, building a personalized plan, and meeting regularly to adjust as your life and circumstances change. Where are you located, and can you work with clients in other states? We are based in Knoxville, TN, but we work with clients nationwide through secure video conferencing. An investment adviser is an individual or a firm that is in the business of giving advice about securities to clients. For instance, individuals or firms that receive compensation for giving advice on investing in stocks, bonds, mutual funds, or exchange traded funds are investment advisers. Some investment advisers manage portfolios of securities Most financial planners are investment advisers, but not all investment advisers are financial planners. Some financial planners assess every aspect of your financial life—including saving, investments, insurance, taxes, retirement, and estate planning—and help you develop a detailed strategy or financial plan for meeting all your financial goals. Others call themselves financial planners, but they may only be able to recommend that you invest in a narrow range of products, and sometimes products that aren’t securities. Before you hire any financial professional, you should know exactly what services you need, what services the professional can deliver, any limitations on what they can recommend, what services you’re paying for, how much those services cost, and how the adviser or planner gets paid. Pilots face unique challenges such as mandatory retirement age, fluctuating industry stability, and strict medical certification requirements. These factors require specialized planning to protect your long-term financial goals. We are a fee-only fiduciary firm, which means we are paid directly by our clients for our advice. We do not earn commissions or have hidden agendas—our advice is always in your best interest. As fiduciaries, we are legally and ethically bound to put your interests first. Every recommendation we make is focused on helping you achieve your goals, not ours. We follow a proven step-by-step process: understanding your goals, building a personalized plan, and meeting regularly to adjust as your life and circumstances change. We are based in Knoxville, TN, but we work with clients nationwide through secure video conferencing. Schedule A Call How to Select an Investment Professional SEC Guidelines Linked Below! Get the Facts The SEC’s Roadmap to Saving and Investing Invest Wisely Advice from your securities regulators Questions You should ask about your investments ...and what to do if you run into problems Schedule A Call Ready to get started? Schedule A Call ### Who We Serve Who We Serve We serve you, wherever you are. Our clients live all across the nation. Our Clients One of the most important roles we serve is to be a sounding board for you at all times to ensure your financial decisions align with your family’s goals and values. We provide thorough research and well-thought-out recommendations for most every situation that could affect your financial life. We will always put your interests first in our relationship and in the financial planning process. This is the true definition of a fiduciary standard. Professional Pilots We are uniquely positioned to help you navigate the challenges of your profession because we face the same challenges. Learn More High-Income Individuals and Families We help turn your financial success into a comfortable and secure lifestyle – a tax-efficient portfolio to help maximize your net worth. Learn More Proudly Serving Clients Across The Nation Based in Knoxville, TN Colorado Springs Denver Metro Seattle Metro Detroit Metro Dallas/Fort Worth Metro  Austin  Corpus Christi Houston Metro Add Your Tooltip Text Here Add Your Tooltip Text Here Tucson Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Add Your Tooltip Text Here Schedule A Call Ready to get started? Schedule A Call ### Who We Are About Us Delivering leading edge advice focused on helping clients. How We Help We deliver leading edge advice focused on helping clients arrive at their personal financial destination. Leading Edge Financial Planning is a fee-only, fiduciary advisory firm focused on helping clients achieve their long-term financial goals. We believe the best way to do so is by fostering authentic relationships built on a foundation of trust.We take the time to get to know you, your current situation, your hopes and dreams for the future, and any challenges you may face on your journey toward financial freedom. We use this knowledge to build a customized financial plan specifically designed to help you achieve your ideal lifestyle, both while you’re working and during retirement.Our team includes experienced professionals dedicated to helping you achieve your version of success, including commercial pilots, a CERTIFIED FINANCIAL PLANNER™ (CFP®), CFA, CPA, EA credential holders.Put simply, we serve as your partner in achieving your version of financial success. Meet The Team Charlie Mattingly, CFP®, MBA Principal, CEO, Senior Financial Planner Phone-alt Envelope ADV2b Read Bio Originally from Louisville, Kentucky, Charlie earned his Bachelor of Science degree in Mechanical Engineering from the University of Tennessee. He then entered the United States Air Force where he served for ten years as an officer and F-16 fighter pilot.While serving in the Air Force Charlie shared his passion for personal financial planning by administering money management classes to his fellow military service men and women. After his ten years in the Air Force, Charlie wanted to begin a new career helping others understand and thrive in personal finance so he earned his Master of Business Administration in Financial Planning from California Lutheran University. Charlie also earned the CERTIFIED FINANCIAL PLANNER™ (CFP®) professional designation in 2012. In addition, Charlie was hired by Southwest Airlines in 2007. After flying commercially for 13 years, Charlie jumped at the opportunity to take the VSP (Voluntary Separation Program) in 2020 to focus on helping his clients.Charlie’s joy in life is to truly understand each client’s unique situation and their family’s goals and dreams for the future. His goal is to take the worry out of personal finance. He works hard to be worthy of his clients’ trust, providing absolute transparency, a high level of integrity and objective advice. His prior life and work experiences as an Air Force officer and pilot have helped him understand the discipline, knowledge and leadership it takes to be an effective financial advisor for his clients.Charlie enjoys watching his three girls grow up, (much too fast), spending quality time with his wife Leisa, reading, and taking care of the horse farm with any time left over.  Originally from Louisville, Kentucky, Charlie earned his Bachelor of Science degree in Mechanical Engineering from the University of Tennessee. He then entered the United States Air Force where he served for ten years as an officer and F-16 fighter pilot.While serving in the Air Force Charlie shared his passion for personal financial planning by administering money management classes to his fellow military service men and women. After his ten years in the Air Force, Charlie wanted to begin a new career helping others understand and thrive in personal finance so he earned his Master of Business Administration in Financial Planning from California Lutheran University. Charlie also earned the CERTIFIED FINANCIAL PLANNER™ (CFP®) professional designation in 2012. In addition, Charlie was hired by Southwest Airlines in 2007. After flying commercially for 13 years, Charlie jumped at the opportunity to take the VSP (Voluntary Separation Program) in 2020 to focus on helping his clients.Charlie’s joy in life is to truly understand each client’s unique situation and their family’s goals and dreams for the future. His goal is to take the worry out of personal finance. He works hard to be worthy of his clients’ trust, providing absolute transparency, a high level of integrity and objective advice. His prior life and work experiences as an Air Force officer and pilot have helped him understand the discipline, knowledge and leadership it takes to be an effective financial advisor for his clients.Charlie enjoys watching his three girls grow up, (much too fast), spending quality time with his wife Leisa, reading, and taking care of the horse farm with any time left over.  Kevin Gormley, CFP®, CPA, PFS Principal, CFO, Senior Financial Planner Phone-alt Envelope ADV2b Read Bio Kevin specializes in working with high-income earners who need assistance in managing company incentive plans, maximizing their investments, and minimizing taxes. He also specializes in cash flow planning for pre-retirees and retirees, and helping them make planning decisions regarding their Social Security benefits.Kevin holds the CERTIFIED FINANCIAL PLANNER™ (CFP®) and the Personal Financial Specialist (PFS) professional designations. Kevin is an active Certified Public Accountant (CPA) in the state of Tennessee.In addition to Leading Edge Financial Planning, Kevin was an Adjunct Professor and taught a Personal Finance class at Maryville College for the J term in January, 2016 and January, 2017. Teaching financial concepts and helping younger people get off to a great financial start is something Kevin enjoys!Kevin is a member of the American Institute of Certified Public Accountants (AICPA), the Tennessee Society of Certified Public Accountants (TSCPA), and is a Board member on the East Tennessee Financial Planning Association (FPA).He graduated with a Bachelor of Science Degree in Business with an emphasis in Finance from Susquehanna University in Pennsylvania. He was a four-year letter winner in football, played club Rugby, and was a member of Lambda Chi Alpha Fraternity. He received his Master of Science in Accounting (MaaC) with a focus on public accounting in 2012 from Strayer University. Prior to working in financial planning, Kevin spent 18 years in Pharmaceutical Sales, Training and Management.Kevin lives in Knoxville with his wife, Jade, and their two sons.  Kevin specializes in working with high-income earners who need assistance in managing company incentive plans, maximizing their investments, and minimizing taxes. He also specializes in cash flow planning for pre-retirees and retirees, and helping them make planning decisions regarding their Social Security benefits.Kevin holds the CERTIFIED FINANCIAL PLANNER™ (CFP®) and the Personal Financial Specialist (PFS) professional designations. Kevin is an active Certified Public Accountant (CPA) in the state of Tennessee.In addition to Leading Edge Financial Planning, Kevin was an Adjunct Professor and taught a Personal Finance class at Maryville College for the J term in January, 2016 and January, 2017. Teaching financial concepts and helping younger people get off to a great financial start is something Kevin enjoys!Kevin is a member of the American Institute of Certified Public Accountants (AICPA), the Tennessee Society of Certified Public Accountants (TSCPA), and is a Board member on the East Tennessee Financial Planning Association (FPA).He graduated with a Bachelor of Science Degree in Business with an emphasis in Finance from Susquehanna University in Pennsylvania. He was a four-year letter winner in football, played club Rugby, and was a member of Lambda Chi Alpha Fraternity. He received his Master of Science in Accounting (MaaC) with a focus on public accounting in 2012 from Strayer University. Prior to working in financial planning, Kevin spent 18 years in Pharmaceutical Sales, Training and Management.Kevin lives in Knoxville with his wife, Jade, and their two sons.  Lisa Rosenthal, BSBA (Management) COO Phone-alt Envelope Read Bio Lisa Rosenthal is the dynamic force propelling our business operations forward in her role as Chief Operating Officer. She plays a pivotal role in maintaining our organizational compass and delivers comprehensive business support to Leading Edge Financial Planning.With a Bachelor’s Degree in Business Management and Marketing from the University of Colorado (Go Buffs!), Lisa brings a wealth of experience to her position. Before joining Leading Edge, she honed her skills through diverse professional experiences, serving as a seasoned human resources generalist, a strategic marketing associate, and a proficient project manager. Lisa possesses an uncanny knack for organization and a genuine love for all things data-related, particularly spreadsheets – yes, you read that right!Originally from Colorado, Lisa’s life journey has been punctuated by her husband’s career as a Marine Corps pilot. Now that he’s retired and working in the airline industry, they’ve decided to call the picturesque state of Wisconsin their home. Alongside their children, their family includes two dogs (a ball-centric Labrador and a quirky Anatolian Shepherd), along with her office companion, Panzer the cat.Beyond her professional endeavors, Lisa enjoys traveling, hiking, skiing, gardening, and supporting her children in their various activities. Her unwavering dedication to both her professional and personal life exemplifies her commitment to excellence. As Chief Operating Officer, Lisa plays a crucial role in ensuring the seamless operation of Leading Edge Financial Planning’s services and supports our clients’ financial well-being. Lisa Rosenthal is the dynamic force propelling our business operations forward in her role as Chief Operating Officer. She plays a pivotal role in maintaining our organizational compass and delivers comprehensive business support to Leading Edge Financial Planning.With a Bachelor’s Degree in Business Management and Marketing from the University of Colorado (Go Buffs!), Lisa brings a wealth of experience to her position. Before joining Leading Edge, she honed her skills through diverse professional experiences, serving as a seasoned human resources generalist, a strategic marketing associate, and a proficient project manager. Lisa possesses an uncanny knack for organization and a genuine love for all things data-related, particularly spreadsheets – yes, you read that right!Originally from Colorado, Lisa’s life journey has been punctuated by her husband’s career as a Marine Corps pilot. Now that he’s retired and working in the airline industry, they’ve decided to call the picturesque state of Wisconsin their home. Alongside their children, their family includes two dogs (a ball-centric Labrador and a quirky Anatolian Shepherd), along with her office companion, Panzer the cat.Beyond her professional endeavors, Lisa enjoys traveling, hiking, skiing, gardening, and supporting her children in their various activities. Her unwavering dedication to both her professional and personal life exemplifies her commitment to excellence. As Chief Operating Officer, Lisa plays a crucial role in ensuring the seamless operation of Leading Edge Financial Planning’s services and supports our clients’ financial well-being. Andrew Christopher, CFA®, MSF Financial Planner, CIO Phone-alt Envelope ADV2b Read Bio Originally from Akron, Ohio, Andy earned his Bachelor of Science in Political Science from the United States Naval Academy. He then entered flight school and served for ten years on active duty as an officer and F/A-18 Super Hornet pilot. Andy continues to serve in the Navy Reserves.He earned his Master of Science in Finance from Georgetown University’s McDonough School of Business and holds the designation of a CFA® charterholder. After leaving the Navy, Andy transitioned into private wealth management and consulting, partnering with clients, and learning the craft of financial planning.As a Lead Planner at Leading Edge, Andy’s primary interest is the intersection of the science of finance and his client’s personal financial well-being and unique planning needs. He recognizes that everyone’s financial outlook and situation is different. With that perspective, he loves diving into the details to develop customized planning solutions.Andy also has a passion for teaching and is an Executive in Residence at Georgetown University’s MS in Finance (MSF) program where he advises and mentors MSF students. Additionally, he is a part-time F-35 contract simulator instructor pilot at Marine Corps Air Station Miramar, teaching newly “winged” Naval Aviators.Andy currently lives in San Diego, CA with his wife, Brittany, and young son. As a Northeast Ohio sport fan, he is perennially disappointed in his team’s season.  Originally from Akron, Ohio, Andy earned his Bachelor of Science in Political Science from the United States Naval Academy. He then entered flight school and served for ten years on active duty as an officer and F/A-18 Super Hornet pilot. Andy continues to serve in the Navy Reserves.He earned his Master of Science in Finance from Georgetown University’s McDonough School of Business and holds the designation of a CFA® charterholder. After leaving the Navy, Andy transitioned into private wealth management and consulting, partnering with clients, and learning the craft of financial planning.As a Lead Planner at Leading Edge, Andy’s primary interest is the intersection of the science of finance and his client’s personal financial well-being and unique planning needs. He recognizes that everyone’s financial outlook and situation is different. With that perspective, he loves diving into the details to develop customized planning solutions.Andy also has a passion for teaching and is an Executive in Residence at Georgetown University’s MS in Finance (MSF) program where he advises and mentors MSF students. Additionally, he is a part-time F-35 contract simulator instructor pilot at Marine Corps Air Station Miramar, teaching newly “winged” Naval Aviators.Andy currently lives in San Diego, CA with his wife, Brittany, and young son. As a Northeast Ohio sport fan, he is perennially disappointed in his team’s season.  Betsy Wheeler, BS/MS Director of Client Services Phone-alt Envelope Read Bio Originally from the suburbs of Chicago, Illinois, Betsy earned her Bachelor of Science in Exercise Science and Master of Science in Kinesiology from the University of Tennessee, Knoxville. Betsy obtained an athletic scholarship competing on the Women’s Division I Intercollegiate Swim Team.Prior to her recent career change, Betsy worked 15 years in healthcare. Betsy collaborated with physicians, pharmacists, nurse practitioners, and physician assistants to decrease risk of adverse outcomes. Betsy has been a client with Leading Edge Financial Planning since 2015 and is very excited to join the team. Betsy is now focused on improving client lives as a Paraplanner.When she is not studying to become a financial planner and IRS Enrolled Agent, you can find her with family and friends – wake surfing, hiking, and of course laughing. She is blessed to have a family that values family, hard work, and charitable giving. Originally from the suburbs of Chicago, Illinois, Betsy earned her Bachelor of Science in Exercise Science and Master of Science in Kinesiology from the University of Tennessee, Knoxville. Betsy obtained an athletic scholarship competing on the Women’s Division I Intercollegiate Swim Team.Prior to her recent career change, Betsy worked 15 years in healthcare. Betsy collaborated with physicians, pharmacists, nurse practitioners, and physician assistants to decrease risk of adverse outcomes. Betsy has been a client with Leading Edge Financial Planning since 2015 and is very excited to join the team. Betsy is now focused on improving client lives as a Paraplanner.When she is not studying to become a financial planner and IRS Enrolled Agent, you can find her with family and friends – wake surfing, hiking, and of course laughing. She is blessed to have a family that values family, hard work, and charitable giving. Nolan Clark, CFP®, B.S. (Finance) Associate Financial Planner Phone-alt Envelope ADV2b Read Bio Born and raised in Owensboro, Kentucky, Nolan earned his Bachelor of Science degree in Finance, with a Personal Financial Planning Concentration from Western Kentucky University (CERTIFIED FINANCIAL PLANNER® Board Registered Program). Prior to joining Leading Edge, Nolan has worked with two other firms in the Financial Services Industry since his sophomore year of college.In addition to Leading Edge Financial Planning, Nolan has served as President of The Financial Planning Association (FPA), volunteer for Junior Achievement, and is an active member at his local Church.Nolan lives in Owensboro, KY with his wife, Clare, and their young son. Nolan enjoys spending quality time with his family, going on hikes, walks, and any other activities that allow him to enjoy the outdoors with others. Born and raised in Owensboro, Kentucky, Nolan earned his Bachelor of Science degree in Finance, with a Personal Financial Planning Concentration from Western Kentucky University (CERTIFIED FINANCIAL PLANNER® Board Registered Program). Prior to joining Leading Edge, Nolan has worked with two other firms in the Financial Services Industry since his sophomore year of college.In addition to Leading Edge Financial Planning, Nolan has served as President of The Financial Planning Association (FPA), volunteer for Junior Achievement, and is an active member at his local Church.Nolan lives in Owensboro, KY with his wife, Clare, and their young son. Nolan enjoys spending quality time with his family, going on hikes, walks, and any other activities that allow him to enjoy the outdoors with others. Jon Schultz, BS (Aeronautics) Paraplanner Phone-alt Envelope ADV2b Read Bio Originally from Lancaster, Pennsylvania, Jon earned his Bachelor of Science degree in Aeronautics from Liberty University. He is currently pursuing his CERTIFIED FINANCIAL PLANNER™ (CFP®) certification.Before joining Leading Edge Financial Planning, Jon spent five years in the aviation industry, beginning his career in aerial survey work, collaborating with NASA and other notable organizations. He later transitioned to flying private jets, where he focused on delivering exceptional client experiences. While serving as a Captain at Flexjet, Jon developed medical issues that led him to pursue a career in financial planning, where he brings the same dedication and attention to detail that defined his aviation career.Jon lives in Raleigh, North Carolina, where he enjoys spending time with his family, exploring his passion for board games, 3D printing, and connecting with friends. He also values charitable giving and actively seeks opportunities to give back through volunteer work.  Originally from Lancaster, Pennsylvania, Jon earned his Bachelor of Science degree in Aeronautics from Liberty University. He is currently pursuing his CERTIFIED FINANCIAL PLANNER™ (CFP®) certification.Before joining Leading Edge Financial Planning, Jon spent five years in the aviation industry, beginning his career in aerial survey work, collaborating with NASA and other notable organizations. He later transitioned to flying private jets, where he focused on delivering exceptional client experiences. While serving as a Captain at Flexjet, Jon developed medical issues that led him to pursue a career in financial planning, where he brings the same dedication and attention to detail that defined his aviation career.Jon lives in Raleigh, North Carolina, where he enjoys spending time with his family, exploring his passion for board games, 3D printing, and connecting with friends. He also values charitable giving and actively seeks opportunities to give back through volunteer work.  Brenda Hill, B.S.B.A (Financial Planning) Paraplanner Phone-alt Envelope Read Bio Brenda is originally from Brazil and moved to Virginia for college, where she’s been ever since. She earned a Bachelor of Science in Business Administration with a focus on Financial Planning and recently passed the CFP® exam. Over the course of her career, Brenda has worked in a variety of roles, from Paraplanner to Financial Planning Analyst for advisors across the country, gaining valuable experience in the financial planning industry.Now, as a Paraplanner at Leading Edge, Brenda supports financial advisors by preparing financial plans, analyzing cases, and ensuring everything is accurate and ready for clients. Brenda’s passionate about continuous learning, understanding the psychology of financial planning, and helping clients bring their goals to life. She loves creating a seamless experience for clients and focusing on comprehensive financial planning.When she’s not working, Brenda loves spending time with her family, playing beach volleyball, watching college hockey, and reading. She lives with her husband and two young sons. And for a fun fact – Brenda is a national champion in Brazilian jiu-jitsu, though she earned the title when she was a 13-year-old girl with no competition in her category. Still, she’ll take the medal with a smile! Brenda is originally from Brazil and moved to Virginia for college, where she’s been ever since. She earned a Bachelor of Science in Business Administration with a focus on Financial Planning and recently passed the CFP® exam. Over the course of her career, Brenda has worked in a variety of roles, from Paraplanner to Financial Planning Analyst for advisors across the country, gaining valuable experience in the financial planning industry.Now, as a Paraplanner at Leading Edge, Brenda supports financial advisors by preparing financial plans, analyzing cases, and ensuring everything is accurate and ready for clients. Brenda’s passionate about continuous learning, understanding the psychology of financial planning, and helping clients bring their goals to life. She loves creating a seamless experience for clients and focusing on comprehensive financial planning.When she’s not working, Brenda loves spending time with her family, playing beach volleyball, watching college hockey, and reading. She lives with her husband and two young sons. And for a fun fact – Brenda is a national champion in Brazilian jiu-jitsu, though she earned the title when she was a 13-year-old girl with no competition in her category. Still, she’ll take the medal with a smile! Kelly Broderick, BS/MS Client Service & Operations Associate Phone-alt Envelope Read Bio Kelly is originally from Pennsylvania and earned her bachelor’s degree from Syracuse University, where she was a member of the Women’s Rowing Team. She went on to earn a master’s degree in Exercise Science from Western Washington University. Before joining the Leading Edge team, Kelly’s professional journey included roles in education, fitness, and client support—each one strengthening her passion for helping others and keeping things running smoothly behind the scenes.She spent nearly two decades supporting her husband’s Navy career at duty stations across the U.S., as well as in Bahrain and Japan. During that time, Kelly also volunteered with a non-profit organization that provides financial assistance to service members and their families.Now settled back in the Philadelphia area, Kelly and her husband enjoy traveling, updating their 100+ year-old home, and skiing with their four kids. Her ability to adapt, organize, and connect with people continues to shine through in both her personal and professional life. Kelly is originally from Pennsylvania and earned her bachelor’s degree from Syracuse University, where she was a member of the Women’s Rowing Team. She went on to earn a master’s degree in Exercise Science from Western Washington University. Before joining the Leading Edge team, Kelly’s professional journey included roles in education, fitness, and client support—each one strengthening her passion for helping others and keeping things running smoothly behind the scenes.She spent nearly two decades supporting her husband’s Navy career at duty stations across the U.S., as well as in Bahrain and Japan. During that time, Kelly also volunteered with a non-profit organization that provides financial assistance to service members and their families.Now settled back in the Philadelphia area, Kelly and her husband enjoy traveling, updating their 100+ year-old home, and skiing with their four kids. Her ability to adapt, organize, and connect with people continues to shine through in both her personal and professional life. Mark Covell, MBA, BSME Financial Planner Phone-alt Envelope ADV2b Read Bio Mark is a dynamic and versatile financial planner with eighteen years of professional experience in aviation and finance. A former Marine Corps fighter pilot (retired Major) and current American Airlines pilot; Mark has joined Leading Edge Financial Planning to help others discover what is possible in their lives and create a pathway to reach what is most important to them.After growing up in South Florida, Mark studied Mechanical Engineering at Georgia Tech and then joined the Marine Corps. He flew the F/A-18 Hornet on active duty and then the C-12 King Air in the reserves, while also serving as an Aviation Safety Officer for multiple commands. After active duty service, he earned his Master in Business Administration at the University of California, San Diego. While working on his MBA, Mark discovered opportunities to improve outcomes and reduce risk in the Healthcare industry. He worked in consulting and then marketing for multiple spine surgery medical device companies. Using risk management and safety concepts from aviation, he collaborated with surgeons to create new products and procedures to reduce medical errors during surgery and improve patient outcomes. Mark is now focused on improving lives as an Investment Advisor Representative.He lives in South Lake Tahoe, CA with his wife Adriana raising one young daughter. When not helping clients or studying to become a CERTIFIED FINANCIAL PLANNER™, you can find Mark outdoors with his family, skiing, snowboarding and mountain biking in the Sierra Nevada mountains. Mark is a dynamic and versatile financial planner with eighteen years of professional experience in aviation and finance. A former Marine Corps fighter pilot (retired Major) and current American Airlines pilot; Mark has joined Leading Edge Financial Planning to help others discover what is possible in their lives and create a pathway to reach what is most important to them.After growing up in South Florida, Mark studied Mechanical Engineering at Georgia Tech and then joined the Marine Corps. He flew the F/A-18 Hornet on active duty and then the C-12 King Air in the reserves, while also serving as an Aviation Safety Officer for multiple commands. After active duty service, he earned his Master in Business Administration at the University of California, San Diego. While working on his MBA, Mark discovered opportunities to improve outcomes and reduce risk in the Healthcare industry. He worked in consulting and then marketing for multiple spine surgery medical device companies. Using risk management and safety concepts from aviation, he collaborated with surgeons to create new products and procedures to reduce medical errors during surgery and improve patient outcomes. Mark is now focused on improving lives as an Investment Advisor Representative.He lives in South Lake Tahoe, CA with his wife Adriana raising one young daughter. When not helping clients or studying to become a CERTIFIED FINANCIAL PLANNER™, you can find Mark outdoors with his family, skiing, snowboarding and mountain biking in the Sierra Nevada mountains. Jason Reagan, CFP®, RICP Financial Planner Phone-alt Envelope ADV2b Read Bio Originally from Annandale, VA (just outside Washington, D.C.), Jason earned his Bachelor of Science degree in Civil Engineering from the University of Tennessee. Jason was an Army ROTC scholarship cadet at UT and was commissioned as a Second Lieutenant upon graduation. After completing the Engineer Officer Basic Course at Ft Leonard Wood, MO, he joined the Army Reserve and obtained his Master of Science degree in Civil Engineering from Virginia Tech and began work as a consulting engineer.During this time, Jason developed a passion for flying, earning his Private Pilot license in 1994. He later decided to leave his engineering career, and in 1999, Jason applied for a branch transfer. He joined the Air Force Reserve where he went to Air Force Pilot Training and flew the C-5 Galaxy and other aircraft. He retired as a Lt Col in 2018 after 25 years of total service.During his time in the military, Jason developed a strong interest in the financial markets and financial planning, in particular. He completed the Certified Financial Planner certification program at Rice University in Houston, TX in 2012 while on active duty orders. After completion of his orders in 2013, he moved to TN and worked as a financial advisor at a large brokerage firm and earned his CFP designation in 2016. He later left that firm as he wanted to work with an organization where he could be a true fiduciary. Jason found that opportunity with Leading Edge Financial Planning.Jason lives in Wears Valley with his wife, Jill, and their 2 children, where they try to spend as much time outdoors as possible. They own a Beech Debonair which he uses for personal travel and animal rescue flights. Jason is also currently a pilot for NetJets. Originally from Annandale, VA (just outside Washington, D.C.), Jason earned his Bachelor of Science degree in Civil Engineering from the University of Tennessee. Jason was an Army ROTC scholarship cadet at UT and was commissioned as a Second Lieutenant upon graduation. After completing the Engineer Officer Basic Course at Ft Leonard Wood, MO, he joined the Army Reserve and obtained his Master of Science degree in Civil Engineering from Virginia Tech and began work as a consulting engineer.During this time, Jason developed a passion for flying, earning his Private Pilot license in 1994. He later decided to leave his engineering career, and in 1999, Jason applied for a branch transfer. He joined the Air Force Reserve where he went to Air Force Pilot Training and flew the C-5 Galaxy and other aircraft. He retired as a Lt Col in 2018 after 25 years of total service.During his time in the military, Jason developed a strong interest in the financial markets and financial planning, in particular. He completed the Certified Financial Planner certification program at Rice University in Houston, TX in 2012 while on active duty orders. After completion of his orders in 2013, he moved to TN and worked as a financial advisor at a large brokerage firm and earned his CFP designation in 2016. He later left that firm as he wanted to work with an organization where he could be a true fiduciary. Jason found that opportunity with Leading Edge Financial Planning.Jason lives in Wears Valley with his wife, Jill, and their 2 children, where they try to spend as much time outdoors as possible. They own a Beech Debonair which he uses for personal travel and animal rescue flights. Jason is also currently a pilot for NetJets. Whitney Abuzeid, B.S. (Intl Business) Client Service Associate Phone-alt Envelope Read Bio Whitney is originally from Beaufort, SC, and graduated from the College of Charleston with a degree in International Business and German language. Whitney’s career journey prior to joining the Leading Edge team has been diverse, spanning the fields of logistics, manufacturing and project management but one thing has remained constant: her love for data and spreadsheets. Throughout these experiences, she also played a pivotal role in supporting her husband’s 14 year military career, all while raising their four young boys! Whitney serves as PTO president, is actively involved in their church and volunteers with Habitat for Humanity. She currently resides in the upstate of South Carolina and when she’s not busy managing her boys’ busy sports schedules, she enjoys traveling, hiking and home renovation projects. Her husband, a captain with American Airlines, shares her love for adventure, and together they love to explore new destinations whenever time allows. Whitney is originally from Beaufort, SC, and graduated from the College of Charleston with a degree in International Business and German language. Whitney’s career journey prior to joining the Leading Edge team has been diverse, spanning the fields of logistics, manufacturing and project management but one thing has remained constant: her love for data and spreadsheets. Throughout these experiences, she also played a pivotal role in supporting her husband’s 14 year military career, all while raising their four young boys! Whitney serves as PTO president, is actively involved in their church and volunteers with Habitat for Humanity. She currently resides in the upstate of South Carolina and when she’s not busy managing her boys’ busy sports schedules, she enjoys traveling, hiking and home renovation projects. Her husband, a captain with American Airlines, shares her love for adventure, and together they love to explore new destinations whenever time allows. Amelie Riendl, AFC®, PMP®, ME Client Service & Marketing Associate Phone-alt Envelope Read Bio Coming soon! Coming soon! Our Core Values At Leading Edge Financial Planning, we believe in a better approach to objective financial advice. Using a fee-only, no-commission business model focused specifically on meeting your goals, we provide unbiased fiduciary advice that is at all times in your best interest. Authenticity We bring our whole selves, act with integrity, and let our genuine care show in every client interaction.  Service We put others first, serving teammates and clients alike with humility and a servant’s heart.  Humility We recognize our strengths and limitations, always seeking to learn so we can better support each other and those we serve.  Abundance We choose optimism and gratitude, sharing generously with our clients and one another. Excellence We hold ourselves to the highest standards in every detail, striving for expertise so clients receive our very best. Schedule A Call Ready to get started? Schedule A Call ### Single Blog ### What We Offer What We Do "Planning is bringing the future into the present so you can do something about it now." -Alan Lakein Financial Planning We can bring significant value to your family's financial life. Written plans help you accomplish your lifestyle goals and objectives. Independent studies repeatedly show that people who take the time to develop a written financial plan WILL do better. Furthermore, you will enjoy greater peace of mind knowing that you and your family are on the right path to accomplishing your financial goals. Pilots High Income Clients Our Services Financial Planning A financial plan is your roadmap to the future. We build a customized strategy that integrates investments, retirement, taxes, estate, and education planning. As life unfolds, we update your plan to keep you on track toward your goals. Investment Management Your portfolio is tailored to your goals, time horizon, and risk tolerance. We build diversified, tax-efficient strategies across all accounts, then actively monitor and adjust as your life and priorities change. Retirement Income Planning The key question before retirement is, “Will I have enough?”. We create income strategies that shift from growth to stability as you approach retirement. Factoring in Social Security, lifestyle, and goals, we provide a plan that adapts as your needs evolve. College Planning With tuition costs rising faster than inflation, early planning is essential. We design savings strategies that minimize taxes and maximize your ability to meet education goals for children or grandchildren. Our approach helps you stay ahead of rising costs with confidence. Proactive Tax Planning Taxes are often the largest expense for high-income earners. Our in-house tax professionals works with you to uncover savings strategies and structure investments for tax efficiency. We coordinate with your accountant so your plan and returns are fully aligned. Estate Planning Financial success isn’t just about security today — it’s about leaving a lasting legacy. We help identify the right estate documents for your situation and connect you with trusted professionals. Our goal is to ensure your wishes are carried out in a tax-efficient way for your loved ones and charities. Ready to get started? Schedule A Call ### Book Meetings Book A Client Meeting Not a client yet? Click here to schedule a consultation instead. Charlie Mattingly, CFP®, MBA If you have a time-sensitive issue, please call me directly at 865-328-4969 Book Now Kevin Gormley, CFP®, CPA, PFS If you have a time-sensitive issue, please call me directly at 865-217-7779 Book Now Jason Reagan, CFP®, RICP If you have a time-sensitive issue, please call me directly at 865-268-8832 Book Now Mark Covell, MBA, BSME If you have a time-sensitive issue, please call me directly at 530-539-1499 Book Now Andrew Christopher, CFA®, MSF If you have a time-sensitive issue, please call me directly at 901-664-3753 Book Now Lisa Rosenthal, BSBA (Management) If you have a time-sensitive issue, please call me directly at 858-449-8277 Book Now Nolan Clark, CFP®, B.S. (Finance) If you have a time-sensitive issue, please call me directly at 270-545-5880 Book Now Betsy Wheeler, BS/MS If you have a time-sensitive issue, please call me directly at 865-328-4974 Book Now Brenda Hill, B.S.B.A (Financial Planning) If you have a time-sensitive issue, please call me directly at 434-477-9297 Book Now Jon Schultz, BS (Aeronautics) If you have a time-sensitive issue, please call me directly at 865-684-4622 Book Now Nidhi Grover, BS (Accounting), E.A. If you have a time-sensitive issue, please call me directly at 609-745-0832 Book Now Ready to get started? Schedule A Call ### Contact Us Get In Touch Ready to take the first step on the path to financial freedom? Contact Us Contact us to schedule a complimentary, no-obligation phone consultation and learn more about how we help you achieve your personal financial goals. 6921 Office Park Circle Knoxville, TN 37909 (865) 240-2292 info@leadingedgeplanning.com Let's Connect Podcast Spotify Youtube Facebook Linkedin Instagram Send Us A Message EmailThis field is for validation purposes and should be left unchanged.Name* First Last Email* Phone*How did you hear about Leading Edge?*CommentConsent* By clicking this box you agree to receive SMS text messages from Leading Edge Financial PlanningBy submitting this form, you agree to receive SMS text messages, emails, phone calls or other communications from Leading Edge Financial Planning (LEFP), an SEC-registered investment adviser, regarding firm-related information. We promise not to spam you, and we will not share or sell your information. Please refer to our ADV Part 2a for details of our Privacy Policy (link can be found below, on the Legal Disclosures page). ### Blogs Welcome to the Blog Trusted insight to help you achieve your goals. Read on. Ready to get started? Schedule A Call ### High income clients ### Home Leading The Way To Your Financial Success We specialize in serving professional pilots and other high-income individuals and families, helping you navigate wealth with clarity, confidence, and purpose. What We Do Schedule A Call Specialized Expertise Financial strategies tailored to pilots and other high-income families, built on years of niche experience. Fiduciary & Objective As a fee-only fiduciary, your best interest always comes first — no commissions, no hidden agenda. Proven Process A clear, step-by-step planning approach that helps you stay on course through every stage of life. About Us At Leading Edge Financial Planning, we believe in a better approach to objective financial advice. Using a fee-only, no-commission business model focused specifically on meeting your goals, we provide unbiased fiduciary advice that is at all times in your best interest. Who We Are Our Clients Who We Serve Pilots High Income Earners Aviation professionals face unique financial challenges. A mandatory retirement date, an uncertain industry and medical certification requirements all have the potential to derail your plans. We navigate these challenges to help you achieve your long-term financial objectives. Learn More You’ve worked hard to achieve career success. Let us translate that success into a comfortable and secure lifestyle. We provide you with the confidence of knowing your financial planning, investments and taxes are under control so you can worry less and focus on doing the things you enjoy most. Learn More Aviation professionals face unique financial challenges. A mandatory retirement date, an uncertain industry and medical certification requirements all have the potential to derail your plans. We navigate these challenges to help you achieve your long-term financial objectives. Learn More You’ve worked hard to achieve career success. Let us translate that success into a comfortable and secure lifestyle. We provide you with the confidence of knowing your financial planning, investments and taxes are under control so you can worry less and focus on doing the things you enjoy most. Learn More Our Services What We Do Retirement Planning Investment Management Financial Planning Estate Planning Tax Planning College Planning Charitable Giving We help you establish a steady stream of monthly income in retirement to provide you with the confidence of knowing your retirement is secure. Learn More Your investment portfolio is specifically designed to help you achieve your long-term objectives. Once established, it is continuously monitored and adjusted as your life and financial situation evolve. Learn More A financial plan serves as a blueprint in helping you achieve your financial goals with confidence. Learn More We understand that financial success is about more than achieving security for yourself. It's also about leaving a legacy for those who matter most. Learn More Our team includes an in-house CPA and tax specialists who work with you to identify and implement tax savings strategies across your entire financial life. Learn More We implement tax-efficient strategies to help you optimize the funds available to cover education expenses for your children or grandchildren. Learn More We partner with clients to support their unique financial goals, including helping those who choose to maximize charitable giving through tax-efficient strategies and tools like donor-advised funds. Learn More We help you establish a steady stream of monthly income in retirement to provide you with the confidence of knowing your retirement is secure. Learn More Your investment portfolio is specifically designed to help you achieve your long-term objectives. Once established, it is continuously monitored and adjusted as your life and financial situation evolve. Learn More A financial plan serves as a blueprint in helping you achieve your financial goals with confidence. Learn More We understand that financial success is about more than achieving security for yourself. It's also about leaving a legacy for those who matter most. Learn More Our team includes an in-house CPA and tax specialists who work with you to identify and implement tax savings strategies across your entire financial life. Learn More We implement tax-efficient strategies to help you optimize the funds available to cover education expenses for your children or grandchildren. Learn More We partner with clients to support their unique financial goals, including helping those who choose to maximize charitable giving through tax-efficient strategies and tools like donor-advised funds. Learn More Frequently Asked Questions What makes financial planning for pilots different from other professions? Pilots face unique challenges such as mandatory retirement age, fluctuating industry stability, and strict medical certification requirements. These factors require specialized planning to protect your long-term financial goals. How are you compensated for your services? We are a fee-only fiduciary firm, which means we are paid directly by our clients for our advice. We do not earn commissions or have hidden agendas—our advice is always in your best interest. What does it mean that you are a fiduciary? As fiduciaries, we are legally and ethically bound to put your interests first. Every recommendation we make is focused on helping you achieve your goals, not ours. What is your financial planning process like? We follow a proven step-by-step process: understanding your goals, building a personalized plan, and meeting regularly to adjust as your life and circumstances change. Where are you located, and can you work with clients in other states? We are based in Knoxville, TN, and we work with clients nationwide through secure video conferencing. Pilots face unique challenges such as mandatory retirement age, fluctuating industry stability, and strict medical certification requirements. These factors require specialized planning to protect your long-term financial goals. We are a fee-only fiduciary firm, which means we are paid directly by our clients for our advice. We do not earn commissions or have hidden agendas—our advice is always in your best interest. As fiduciaries, we are legally and ethically bound to put your interests first. Every recommendation we make is focused on helping you achieve your goals, not ours. We follow a proven step-by-step process: understanding your goals, building a personalized plan, and meeting regularly to adjust as your life and circumstances change. We are based in Knoxville, TN, and we work with clients nationwide through secure video conferencing. See More FAQs Our Purpose Our purpose is to empower people to find peace, clarity, and freedom by connecting their money to what truly matters to them.  Our Vision At Leading Edge Financial Planning, our vision is to be the trusted leader in serving professional pilots, celebrated for our outstanding reputation, a thriving company culture centered on well-being, and commitment to values that inspire excellence and attract the best talent.  Ready to get started? Schedule A Call ## What We Offer ### Estate Planning We understand that financial success is about more than achieving security for yourself, it’s also about leaving a legacy for those who matter most. A solid estate plan plays a key role in ensuring a lasting legacy for your loved ones and favorite charities. We identify the necessary estate planning documents based on your particular situation and objectives and connect you with estate planning professionals who can help ensure your generational planning goals are executed in a tax-efficient manner. Excerpt: We understand that financial success is about more than achieving security for yourself. It’s also about leaving a legacy for those who matter most. ### Proactive Tax Planning Taxes may be one of the single biggest expenses faced by those who make more than $200,000 per year. That is why our team is by supported by an in-house tax professional who will work with you to identify and implement tax savings strategies across your entire financial life. We structure your investments to minimize capital gains taxes, and we harvest investment losses to offset gains. We also work with your accountant to ensure your tax strategy is fully integrated across your financial plan and annual income tax returns. Excerpt: Our team includes an in-house CPA who works with you to identify and implement tax savings strategies across your entire financial life. ### College Planning Over the last 20 years, college tuition costs have grown at a rate that far outpaces inflation and wage increases, posing significant financial challenges for many families. Giving these rapidly rising costs, it’s no wonder many parents are concerned about how they will help their children afford higher education. If you have a goal of funding higher education expenses for a child or grandchild, it’s important to start planning early. We will incorporate a range of tools and strategies to help your plan for educational expenses. Based on your specific college planning goals, we will implement a savings strategy that minimizes taxes and optimizes your ability to offset rising tuition expenses. Excerpt: We implement tax-efficient strategies to help you optimize the funds available to cover education expenses for your children or grandchildren. ### Retirement Income Planning Perhaps the biggest question clients ask as they near retirement is, “Will I have enough money to maintain my current lifestyle?” We help you confidently answer “yes” to this question by establishing a steady stream of retirement income. To do so, we gradually shift your portfolio from growth-focused to income-focused as you near retirement. Once you’ve retired, we implement a risk appropriate strategy to cover your monthly expenses. This strategy takes into account your Social Security benefits in light of your marital status, life expectancy, retirement goals, income requirements, and more. We then re-evaluate your plan on a regular basis to ensure it continues to meet your changing needs. We aim to provide you with the confidence of knowing you are well positioned for a secure retirement. Excerpt: We help you establish a steady stream of monthly income in retirement to provide you with the confidence of knowing your retirement is secure. ### Investment Management Your investment portfolio is specifically designed to help you achieve your long-term objectives. We consider all of your accounts as we build a tax-efficient, diversified portfolio that addresses your current financial situation, personal and professional challenges, income needs in retirement, investment time horizon, risk tolerance and more. We determine an asset allocation that meets your current needs and goals for the future. We then continuously monitor and adjust your investments as your life and financial situation evolve over time. Excerpt: Your investment portfolio is specifically designed to help you achieve your long-term objectives. Once established, it is continuously monitored and adjusted as your life and financial situation evolve. ### Financial Planning A financial plan serves as a blueprint in helping you achieve your financial goals. We work with you to build a customized financial plan specifically focused on your vision for the future. This financial plan incorporates a wide range of financial strategies related to investment management, retirement income planning, college planning, tax planning, estate planning and more. We constantly revisit and reevaluate your custom plan to help ensure it continues to address the challenges and milestones of your evolving financial life. Excerpt: A financial plan serves as a blueprint in helping you achieve your financial goals with confidence. ## Our Teams ### Charlie Mattingly Originally from Louisville, Kentucky, Charlie earned his Bachelor of Science degree in Mechanical Engineering from the University of Tennessee. He then entered the United States Air Force where he served for ten years as an officer and F-16 fighter pilot. While serving in the Air Force Charlie shared his passion for personal financial planning by administering money management classes to his fellow military service men and women. After his ten years in the Air Force, Charlie wanted to begin a new career helping others understand and thrive in personal finance so he earned his Master of Business Administration in Financial Planning from California Lutheran University. Charlie also earned the CERTIFIED FINANCIAL PLANNER™ (CFP®) professional designation in 2012. In addition, Charlie was hired by Southwest Airlines in 2007. After flying commercially for 13 years, Charlie jumped at the opportunity to take the VSP (Voluntary Separation Program) in 2020 to focus on helping his clients. Charlie’s joy in life is to truly understand each client’s unique situation and their family’s goals and dreams for the future. His goal is to take the worry out of personal finance. He works hard to be worthy of his clients’ trust, providing absolute transparency, a high level of integrity and objective advice. His prior life and work experiences as an Air Force officer and pilot have helped him understand the discipline, knowledge and leadership it takes to be an effective financial advisor for his clients. Charlie enjoys watching his three girls grow up, (much too fast), spending quality time with his wife Leisa, reading, and taking care of the horse farm with any time left over. ### Kevin Gormley Kevin specializes in working with high-income earners who need assistance in managing company incentive plans, maximizing their investments, and minimizing taxes. He also specializes in cash flow planning for pre-retirees and retirees, and helping them make planning decisions regarding their Social Security benefits. Kevin holds the CERTIFIED FINANCIAL PLANNER™ (CFP®) and the Personal Financial Specialist (PFS) professional designations. Kevin is an active Certified Public Accountant (CPA) in the state of Tennessee. In addition to Leading Edge Financial Planning, Kevin was an Adjunct Professor and taught a Personal Finance class at Maryville College for the J term in January, 2016 and January, 2017. Teaching financial concepts and helping younger people get off to a great financial start is something Kevin enjoys! Kevin is a member of the American Institute of Certified Public Accountants (AICPA), the Tennessee Society of Certified Public Accountants (TSCPA), and is a Board member on the East Tennessee Financial Planning Association (FPA). He graduated with a Bachelor of Science Degree in Business with an emphasis in Finance from Susquehanna University in Pennsylvania. He was a four-year letter winner in football, played club Rugby, and was a member of Lambda Chi Alpha Fraternity. He received his Master of Science in Accounting (MaaC) with a focus on public accounting in 2012 from Strayer University. Prior to working in financial planning, Kevin spent 18 years in Pharmaceutical Sales, Training and Management. Kevin lives in Knoxville with his wife, Jade, and their two sons. ### Lisa Rosenthal Lisa Rosenthal is the dynamic force propelling our business operations forward in her role as Chief Operating Officer. She plays a pivotal role in maintaining our organizational compass and delivers comprehensive business support to Leading Edge Financial Planning. With a Bachelor's Degree in Business Management and Marketing from the University of Colorado (Go Buffs!), Lisa brings a wealth of experience to her position. Before joining Leading Edge, she honed her skills through diverse professional experiences, serving as a seasoned human resources generalist, a strategic marketing associate, and a proficient project manager. Lisa possesses an uncanny knack for organization and a genuine love for all things data-related, particularly spreadsheets - yes, you read that right! Originally from Colorado, Lisa's life journey has been punctuated by her husband's career as a Marine Corps pilot. Now that he's retired and working in the airline industry, they've decided to call the picturesque state of Wisconsin their home. Alongside their children, their family includes two dogs (a ball-centric Labrador and a quirky Anatolian Shepherd), along with her office companion, Panzer the cat. Beyond her professional endeavors, Lisa enjoys traveling, hiking, skiing, gardening, and supporting her children in their various activities. Her unwavering dedication to both her professional and personal life exemplifies her commitment to excellence. As Chief Operating Officer, Lisa plays a crucial role in ensuring the seamless operation of Leading Edge Financial Planning's services and supports our clients' financial well-being. ### Andrew Christopher Originally from Akron, Ohio, Andy earned his Bachelor of Science in Political Science from the United States Naval Academy. He then entered flight school and served for ten years on active duty as an officer and F/A-18 Super Hornet pilot. Andy continues to serve in the Navy Reserves. He earned his Master of Science in Finance from Georgetown University’s McDonough School of Business and holds the designation of a CFA® charterholder. After leaving the Navy, Andy transitioned into private wealth management and consulting, partnering with clients, and learning the craft of financial planning. As a Lead Planner at Leading Edge, Andy’s primary interest is the intersection of the science of finance and his client’s personal financial well-being and unique planning needs. He recognizes that everyone’s financial outlook and situation is different. With that perspective, he loves diving into the details to develop customized planning solutions. Andy also has a passion for teaching and is an Executive in Residence at Georgetown University’s MS in Finance (MSF) program where he advises and mentors MSF students. Additionally, he is a part-time F-35 contract simulator instructor pilot at Marine Corps Air Station Miramar, teaching newly “winged” Naval Aviators. Andy currently lives in San Diego, CA with his wife, Brittany, and young son. As a Northeast Ohio sport fan, he is perennially disappointed in his team’s season. ### Betsy Wheeler Originally from the suburbs of Chicago, Illinois, Betsy earned her Bachelor of Science in Exercise Science and Master of Science in Kinesiology from the University of Tennessee, Knoxville. Betsy obtained an athletic scholarship competing on the Women’s Division I Intercollegiate Swim Team. Prior to her recent career change, Betsy worked 15 years in healthcare. Betsy collaborated with physicians, pharmacists, nurse practitioners, and physician assistants to decrease risk of adverse outcomes.  Betsy has been a client with Leading Edge Financial Planning since 2015 and is very excited to join the team. Betsy is now focused on improving client lives as a Paraplanner. When she is not studying to become a financial planner and IRS Enrolled Agent, you can find her with family and friends - wake surfing, hiking, and of course laughing. She is blessed to have a family that values family, hard work, and charitable giving. ### Nolan Clark Born and raised in Owensboro, Kentucky, Nolan earned his Bachelor of Science degree in Finance, with a Personal Financial Planning Concentration from Western Kentucky University (CERTIFIED FINANCIAL PLANNER® Board Registered Program). Prior to joining Leading Edge, Nolan has worked with two other firms in the Financial Services Industry since his sophomore year of college. In addition to Leading Edge Financial Planning, Nolan has served as President of The Financial Planning Association (FPA), volunteer for Junior Achievement, and is an active member at his local Church. Nolan lives in Owensboro, KY with his wife, Clare, and their young son. Nolan enjoys spending quality time with his family, going on hikes, walks, and any other activities that allow him to enjoy the outdoors with others. Excerpt: Born and raised in Owensboro, Kentucky, Nolan earned his Bachelor of Science degree in Finance, with a Personal Financial Planning Concentration from Western Kentucky University (CERTIFIED FINANCIAL PLANNER® Board Registered Program). Prior to joining Leading Edge, Nolan has worked with two other firms in the Financial Services Industry since his sophomore year of college. In addition to Leading Edge Financial Planning, Nolan has served as President of The Financial Planning Association (FPA), volunteer for Junior Achievement, and is an active member at his local Church. Nolan lives in Owensboro, KY with his wife, Clare, and their young son. Nolan enjoys spending quality time with his family, going on hikes, walks, and any other activities that allow him to enjoy the outdoors with others. ### Nidhi Grover Nidhi previously worked as a master tax advisor with H&R Block/Block Advisors for 10 years and is an Enrolled Agent (EA). Nidhi holds a Bachelor's degree from Osmania University, India and specialized in accounting. She has also specialized in US income tax. She enjoys working with clients to get the most from their taxes and reach their financial goals. Nidhi volunteers every Friday evening in community related events and loves to travel. She has visited 12 national parks and looks forward to going to many more. She lives in Princeton, NJ with her husband, teen son and their Labrador dog. ### Jon Schultz Originally from Lancaster, Pennsylvania, Jon earned his Bachelor of Science degree in Aeronautics from Liberty University. He is currently pursuing his CERTIFIED FINANCIAL PLANNER™ (CFP®) certification. Before joining Leading Edge Financial Planning, Jon spent five years in the aviation industry, beginning his career in aerial survey work, collaborating with NASA and other notable organizations. He later transitioned to flying private jets, where he focused on delivering exceptional client experiences. While serving as a Captain at Flexjet, Jon developed medical issues that led him to pursue a career in financial planning, where he brings the same dedication and attention to detail that defined his aviation career. Jon lives in Raleigh, North Carolina, where he enjoys spending time with his family, exploring his passion for board games, 3D printing, and connecting with friends. He also values charitable giving and actively seeks opportunities to give back through volunteer work. ### Brenda Hill Brenda is originally from Brazil and moved to Virginia for college, where she’s been ever since. She earned a Bachelor of Science in Business Administration with a focus on Financial Planning and recently passed the CFP® exam. Over the course of her career, Brenda has worked in a variety of roles, from Paraplanner to Financial Planning Analyst for advisors across the country, gaining valuable experience in the financial planning industry. Now, as a Paraplanner at Leading Edge, Brenda supports financial advisors by preparing financial plans, analyzing cases, and ensuring everything is accurate and ready for clients. Brenda’s passionate about continuous learning, understanding the psychology of financial planning, and helping clients bring their goals to life. She loves creating a seamless experience for clients and focusing on comprehensive financial planning. When she’s not working, Brenda loves spending time with her family, playing beach volleyball, watching college hockey, and reading. She lives with her husband and two young sons. And for a fun fact - Brenda is a national champion in Brazilian jiu-jitsu, though she earned the title when she was a 13-year-old girl with no competition in her category. Still, she’ll take the medal with a smile! ### Kelly Broderick Kelly is originally from Pennsylvania and earned her bachelor’s degree from Syracuse University, where she was a member of the Women’s Rowing Team. She went on to earn a master’s degree in Exercise Science from Western Washington University. Before joining the Leading Edge team, Kelly’s professional journey included roles in education, fitness, and client support—each one strengthening her passion for helping others and keeping things running smoothly behind the scenes. She spent nearly two decades supporting her husband’s Navy career at duty stations across the U.S., as well as in Bahrain and Japan. During that time, Kelly also volunteered with a non-profit organization that provides financial assistance to service members and their families. Now settled back in the Philadelphia area, Kelly and her husband enjoy traveling, updating their 100+ year-old home, and skiing with their four kids. Her ability to adapt, organize, and connect with people continues to shine through in both her personal and professional life. Excerpt: Kelly Broderick, CSA & Operations Associate at Leading Edge Financial Planning ### Mark Covell Mark is a dynamic and versatile financial planner with eighteen years of professional experience in aviation and finance. A former Marine Corps fighter pilot (retired Major) and current American Airlines pilot; Mark has joined Leading Edge Financial Planning to help others discover what is possible in their lives and create a pathway to reach what is most important to them. After growing up in South Florida, Mark studied Mechanical Engineering at Georgia Tech and then joined the Marine Corps. He flew the F/A-18 Hornet on active duty and then the C-12 King Air in the reserves, while also serving as an Aviation Safety Officer for multiple commands. After active duty service, he earned his Master in Business Administration at the University of California, San Diego. While working on his MBA, Mark discovered opportunities to improve outcomes and reduce risk in the Healthcare industry. He worked in consulting and then marketing for multiple spine surgery medical device companies. Using risk management and safety concepts from aviation, he collaborated with surgeons to create new products and procedures to reduce medical errors during surgery and improve patient outcomes. Mark is now focused on improving lives as an Investment Advisor Representative. He lives in South Lake Tahoe, CA with his wife Adriana raising one young daughter. When not helping clients or studying to become a CERTIFIED FINANCIAL PLANNER™, you can find Mark outdoors with his family, skiing, snowboarding and mountain biking in the Sierra Nevada mountains. ### Jason Reagan Originally from Annandale, VA (just outside Washington, D.C.), Jason earned his Bachelor of Science degree in Civil Engineering from the University of Tennessee. Jason was an Army ROTC scholarship cadet at UT and was commissioned as a Second Lieutenant upon graduation. After completing the Engineer Officer Basic Course at Ft Leonard Wood, MO, he joined the Army Reserve and obtained his Master of Science degree in Civil Engineering from Virginia Tech and began work as a consulting engineer. During this time, Jason developed a passion for flying, earning his Private Pilot license in 1994. He later decided to leave his engineering career, and in 1999, Jason applied for a branch transfer. He joined the Air Force Reserve where he went to Air Force Pilot Training and flew the C-5 Galaxy and other aircraft. He retired as a Lt Col in 2018 after 25 years of total service. During his time in the military, Jason developed a strong interest in the financial markets and financial planning, in particular. He completed the Certified Financial Planner certification program at Rice University in Houston, TX in 2012 while on active duty orders. After completion of his orders in 2013, he moved to TN and worked as a financial advisor at a large brokerage firm and earned his CFP designation in 2016. He later left that firm as he wanted to work with an organization where he could be a true fiduciary. Jason found that opportunity with Leading Edge Financial Planning. Jason lives in Wears Valley with his wife, Jill, and their 2 children, where they try to spend as much time outdoors as possible. They own a Beech Debonair which he uses for personal travel and animal rescue flights. Jason is also currently a pilot for NetJets. ### Whitney Abuzeid Whitney is originally from Beaufort, SC, and graduated from the College of Charleston with a degree in International Business and German language. Whitney's career journey prior to joining the Leading Edge team has been diverse, spanning the fields of logistics, manufacturing and project management but one thing has remained constant: her love for data and spreadsheets. Throughout these experiences, she also played a pivotal role in supporting her husband's 14 year military career, all while raising their four young boys! Whitney serves as PTO president, is actively involved in their church and volunteers with Habitat for Humanity. She currently resides in the upstate of South Carolina and when she's not busy managing her boys' busy sports schedules, she enjoys traveling, hiking and home renovation projects. Her husband, a captain with American Airlines, shares her love for adventure, and together they love to explore new destinations whenever time allows. ### Amelie Riendl ## Service Areas ### High-Income Individuals and Families Making and maintaining a high income means you face unique financial challenges, including: High tax obligations that gnaw away at your earnings A limited number of earning years Multiple financial priorities competing for your income A busy life that allows little time for financial planning The stress of unexpected situations that may derail your earning ability A Tax-Efficient Portfolio to Help Maximize Your Net Worth Did you know that if you earn more than $200,000 per year, taxes are likely your highest expense? If you’re not viewing every financial decision through a tax-efficient lens, you’re probably paying too much to Uncle Sam. At Leading Edge Financial Planning, our in-house CPA helps identify tax savings opportunities across all of your accounts and investments, and we incorporate a variety of tax strategies into your customized financial plan. We also work with your personal accountant to help ensure these strategies are integrated into your annual tax return. Our process is as follows: Excerpt: We turn your financial success into a comfortable and secure lifestyle. A Tax-Efficient Portfolio to Help Maximize Your Net Worth. ### Commercial Pilots We are uniquely positioned to help you navigate the challenges of your profession because we face the same challenges. Our experienced professionals help commercial pilots navigate the unique challenges of their professional and personal lives. Three of our financial planners are commercial pilots who provide insight into the lifestyle, income and career path obstacles you face in achieving your financial goals. Your financial plan is designed with the following challenges in mind: Excerpt: We are uniquely positioned to help you navigate the challenges of your profession because we face the same challenges.