Windsor Wealth Management LLC

Investment service in Topsfield, Massachusetts

Windsor Insights

Medicare: The $1 Mistake that Costs $3,500

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Most people assume Medicare premiums rise gradually as your income goes up.

However, this isn’t the case.

Instead of a smooth ramp, Medicare uses Income-Related Monthly Adjustment Amounts (IRMAA).

Think of IRMAA as a “cliff penalty.”

While standard income taxes are marginal, IRMAA is all-or-nothing. If you cross an income threshold by even one dollar, you “fall off the cliff”—triggering a significantly higher surcharge on your entire premium for the rest of the year.

(See our example below of how crossing a threshold by a single dollar costs a couple almost $3,500 in 2026.)

Chart Overview

The following chart highlights how 2026 Medicare premiums (based on 2024 income) behave in real life.

Your income can remain flat for years, and then suddenly trigger a meaningful jump in both Part B and Part D premiums.

How?

Keep in mind, households with $2–$10 million portfolios (or more) generally draw income from multiple sources: RMDs, realized capital gains, Roth conversions, interest and dividends, and liquidity events (e.g., business sales or real estate transactions).

Individually, each decision may make sense. Taken together, they can quietly push your income into a higher IRMAA tier.

At Windsor Wealth Management, Medicare premium thresholds are something we factor into planning conversations alongside taxes, income needs, required distributions and more.

The goal isn’t to avoid income.

Instead, it’s to control when and how income shows up, so healthcare costs don’t unnecessarily erode retirement cash flow.

CHART: Medicare 2026 Part B & D Premiums by Income

Things to know:

  • Premiums are per person.
  • The income used to determine your 2026 premium is your Modified Adjusted Gross Income (MAGI) from your 2024 tax return.
  • The Part B column is your total monthly premium. The Part D column is an extra surcharge paid to Medicare; you add this amount to whatever you already pay your private provider for drug coverage.
  • Medicare premiums “roll forward” each year and are based on income from two years prior (e.g., 2027 premiums are based on your 2025 MAGI, not when you first enrolled).

DEEP DIVE RESOURCE: Check out Fidelity’s Medicare Information Portal, which includes step-by-step resources to help you prepare for Medicare.2

One Dollar Can Cost You $3,500

Medicare premiums might seem like a small detail when managing a large portfolio, but the “cliffs” are steep.

If a married couple has a 2024 income of $274,000, they stay within their current bracket.

However, if they cross that threshold by just one dollar ($274,001), they trigger a higher tier for the entire year.

Here’s how that $1 “mistake” adds up for a couple in 2026:

  • Part B Jump: +$121.70/month per person
  • Part D Jump: +$23.00/month per person
  • Total Monthly Increase: $289.40 for the couple
  • Total Annual Cost: $3,472.80

This is nearly $3,500 in stealth taxes caused by a single dollar of extra income—money that could instead fund a family vacation or your grandkids’ 529 college savings plans.

If you’d like a better understanding of how Medicare fits into your overall retirement plan, reach out anytime.

–David Bunker, Financial Advisor & Licensed Fiduciary

P.S.— We recently took a deep dive into this season’s tax preparation. Read the post: 2026 Tax Planning Resources & Key Financial Data

Before You Go

Get help optimizing your retirement income. Download our FREE “Prolonging Retirement Income” checklist.

Also, receive help retiring to the life you want, schedule a complimentary financial planning consultation.

This communication was prepared with financial writer Sharron Senter’s assistance, based on interviews with David Bunker, a financial advisor and licensed fiduciary.

Sources:

1: Medicare.gov, 2026 Medicare costs fact sheet, https://www.medicare.gov/publications/11579-medicare-costs.pdf

2: Fidelity.com, Fidelity Medicare Services®, https://medicare.fidelity.com/home

2026 Tax Planning Resources & Key Financial Data

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Happy New Year!

As a new tax season begins, we’ve pulled together updates and resources you may find helpful to reference throughout the year.

Today, we discuss:

  • The SALT deduction increase and why more families will likely itemize taxes this year.
  • The new senior “bonus” deduction for individuals aged 65 and up.
  • A catch-up curveball impacting high earners.
  • The new $1,000 charitable deduction, even if you don’t itemize.
  • Why early-year QCDs create a “double” impact.
  • Deductions impacted by filing status.
  • 2025 withholdings and strategically positioning yourself for 2026.
  • Why January is a great time to adjust retirement contributions.
  • Required Minimum Distributions (RMDs).
  • Key financial facts for the 2025 and 2026 tax years, including standard deductions, retirement contribution limits, Social Security taxation, Medicare premiums and more. (2 handy handouts)

Reassess Itemizing Under the Expanded SALT Deduction

As a result of the One Big Beautiful Bill Act (OBBBA), the state and local tax (SALT) deduction cap has quadrupled to $40,000. For many, this makes itemizing a viable option again, offering potentially greater savings than the standard deduction.

(Note: This higher cap begins to phase down for households with a modified adjusted gross income (MAGI) over $500,000, eventually returning to the $10,000 limit for those earning over $600,000.)

If you:

  • Pay High State & Local Taxes
  • Own Your Home
  • Make Regular Charitable Contributions
  • Pay Mortgage Interest

…then itemizing may be a savings option for you.

EXAMPLE: See a side-by-side comparison of the standard deduction versus the new $40,000 SALT cap for married couples filing jointly in our recent post: 2025 Tax Changes: One Big Beautiful Bill Act (OBBBA)

Leverage the New Senior “Bonus” Deduction

Given the new OBBBA laws, those aged 65 and older can claim a new $6,000 senior bonus deduction ($12,000 for married couples).

This temporary benefit starts in 2025 and expires after December 31, 2028.

The full deduction is available to single filers with a MAGI up to $75,000 and married couples up to $150,000. It gradually phases out after, and is completely eliminated at incomes of $175,000 (single) and $250,000 (married).

This H&R Block article discusses the deduction in detail: New $6,000 deduction for seniors.1

Navigate the SECURE 2.0 Catch-Up Curveball

There’s a new twist for building your retirement nest egg starting in 2026.

If you earned more than $150,000 last year, the IRS now requires your “catch-up” contributions to be made as Roth (after-tax) instead of pre-tax.

While you won’t get the upfront tax break, the payoff is that this money will be tax-free when you retire, including any growth.

Finally, don’t forget about the “Super Catch-Up.” If you’re aged 60, 61, 62 or 63, you’ve hit a special four-year window that allows you to contribute a much higher limit of $11,250 to your 401(k) for tax year 2025.

RESOURCE: For a deep dive, Schwab has a great guide titled: Catch-Up Contributions 2025 and 2026. It breaks down these numbers and the new Roth requirement in detail.2

Claim the New $1,000 Charitable Deduction (No Itemizing Required)

You can deduct up to $1,000 (single filers) or $2,000 (married couples filing jointly) for cash donations to qualified charities, even if you take the standard deduction, starting in tax year 2026.

For tax purposes, “cash” includes donations made by check, credit card or electronic transfer—not property (e.g., clothing, furniture) or securities.

Accelerate Impact with Earlier QCDs

Qualified Charitable Distributions (QCDs) are an efficient way to manage RMD-related taxes.

By donating directly from your IRA, you can reduce taxable income, satisfy RMD requirements and support causes you care about.

However, timing matters.

Because of how the IRS applies annual distribution ordering, any IRA withdrawals taken before a QCD count as taxable income and are applied toward your RMD first. That leaves less room for a tax-free QCD later in the year.

For Example:

If your total RMD for the year is $150,000 and you withdraw $150,000 for personal use in February, this entire amount is taxable. Even if you make a $25,000 donation to charity in October, you cannot “swap” the two; the February cash has already satisfied your RMD with taxable dollars.

Instead, by prioritizing QCDs earlier in the year, you help ensure these first dollars go directly to charity, rather than accidentally triggering taxable income through personal withdrawals.

This approach also helps avoid year-end processing delays and gets your charitable dollars working sooner.

Verify Your Filing Status

Life changes often drive tax outcomes.

Marriage, divorce, the loss of a spouse, or a dependent aging out could impact your:

  • Standard Deduction
  • Tax Brackets
  • Eligibility for Credits and Deductions

A solid understanding of your filing status is critical in order to optimize your tax situation.

Fine-Tune 2025 Withholdings for 2026

Your tax return doesn’t just close the books on 2025; it informs smarter decisions for 2026.

Reviewing withholdings now helps you:

  • Avoid Surprises Next April
  • Align Tax Payments with Actual Income
  • Adjust for Bonuses, Side Income and Retirement Distributions

Overall, reviewing your withholdings now is especially important if your 2025 income fluctuated more than expected.

Optimize Retirement Contributions Early

January is the ideal time to revisit retirement contributions.

Increasing them early spreads savings evenly across the year, reduces decision fatigue and helps keep your financial plan on track automatically.

At the same time, if your income came in higher than expected in 2025, confirm you didn’t exceed contribution limits. Remember, over-contributions can trigger avoidable penalties, but they’re much easier to fix when caught early.

Prepare for Required Minimum Distributions (RMDs)

If you take RMDs—or will for the first time—this deserves early attention.

Taking RMDs increases your taxable income, which can:

  • Push You into a Higher Tax Bracket
  • Increase Medicare Premiums
  • Trigger Social Security Benefits Taxation

Also, if this is your first RMD year, timing matters.

Delays can result in two RMDs landing in the same tax year, increasing taxable income.

Download 2025 & 2026 Key Financial Data (Handouts)

To make your life easier, we have two handy spreadsheets highlighting key numbers you’ll likely need throughout the year.

They include:

  • Standard Deductions by Filing Status
  • Retirement Plan Contribution Limits
  • Educational Credits and Deductions
  • Medicare-Related Thresholds
  • Health Savings Account (HSA) Limits*
  • Capital Gains and Dividend Tax Rates
  • Social Security Taxation Thresholds
  • Tax Deadlines

*When possible, max-out this contribution, given its triple tax benefit: tax-deductible contributions, tax-free growth, tax-free qualified withdrawals.

Here are the handouts:

2025 Key Financial Facts — What to Know This Tax Season

2026 Key Financial Facts — Planning Ahead

If you’d like hard copies, please let us know. We’re happy to mail them to you, or you’re welcome to stop in. We’d love to see you!

–David Bunker, Financial Advisor & Licensed Fiduciary

Before You Go

Get help optimizing your retirement income. Download our FREE “Prolonging Retirement Income” checklist.

Also, receive help retiring to the life you want, schedule a complimentary financial planning consultation.

This communication was prepared with financial writer Sharron Senter’s assistance, based on interviews with David Bunker, a financial advisor and licensed fiduciary.

Sources:

1: H&R Block, New $6,000 deduction for seniors, hrblock.com/tax-center/irs/tax-law-and-policy/one-big-beautiful-bill-senior-tax-deduction

2: Charles Schwab, Catch-Up Contributions 2025 and 2026, https://www.schwab.com/learn/story/what-to-know-about-catch-up-contributions

Bay Colony Advisors, DBA Windsor Wealth Management, is not a Certified Public Accountant and does not provide tax, legal, or accounting advice. Any tax-related information provided is for general informational purposes only and should not be construed as legal or tax advice. Each individual’s tax situation is unique, and you should consult with your own tax, financial, or legal advisors before making any decisions. We strongly recommend seeking the advice of a qualified CPA or other professional for personalized tax advice.

A Key Trend Worth Watching & Your Portfolio

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There’s been no shortage of noise lately about an “AI bubble.”

Yet, the data suggests we’re seeing a structural shift in how the economy operates—driven by steady, long-term investments rather than speculation.

As the chart below shows, technology and R&D spending as a share of the U.S. economy is now higher than it was during the dot-com era, currently led by massive investments in AI infrastructure.

However, unlike the 90s, today’s tech leaders are backed by robust earnings and significant cash reserves—capital that’s available for acquisitions, stock buybacks and weathering downturns without needing to raise outside funding.

Chart Source: Capital Group1

Who will win? A key trend to watch.

All this spending begs the question: how does this build-out translate into shareholder returns?

While current winners include the companies building data centers and power grids that supply the computing power AI requires, history suggests the biggest beneficiaries may not even exist yet.

Just as the internet reaching critical mass enabled companies like Facebook (Meta) and PayPal, today’s AI infrastructure build-out is setting the stage for a new generation of high-growth businesses.

So who will they be?

That’s the key question—and only time will tell.

In the meantime, we’re focused on data and research—tracking where investment, earnings and innovation are converging.

You can read more about this concept and the data behind it in Capital Group’s article, 4 charts on why the U.S. economy could stay resilient.2

Your Portfolio: Rebalancing Is Critical During Aggressive Growth

One of our core disciplines during periods of strong growth is frequent rebalancing.

Specifically, trimming positions and taking profits when portfolios drift out of alignment, rather than chasing what’s already run up.

As always, our focus remains the same: staying invested, staying balanced and keeping your long-term plan on track—regardless of the headlines.

Final Thought

It’s important to remember that roughly $7.5 trillion is sitting in money market funds and cash equivalents waiting to be invested.

This sidelined capital adds a significant layer of economic stability, especially during times of loud “AI bubble” noise.

If you’d like to talk through how this trend fits into your portfolio, reach out anytime.

Happy Holidays,

–David Bunker, Financial Advisor & Licensed Fiduciary

P.S. — I recently spent some time analyzing the year ahead. If you’re curious about what’s coming next, you can find my breakdown here: Rate Cuts, Jobs and Growth: A Look at 2026.

Before You Go

Get help optimizing your retirement income. Download our FREE “Prolonging Retirement Income” checklist.

Also, receive help retiring to the life you want, schedule a complimentary financial planning consultation.

This communication was prepared with financial writer Sharron Senter’s assistance, based on interviews with David Bunker, a financial advisor and licensed fiduciary.

Source:

1 & 2: Capital Group, 4 charts on why the U.S. economy could stay resilient, https://www.capitalgroup.com/ria/insights/articles/4-charts-us-economy-resilient.html

Rate Cuts, Jobs, Growth: A Look at 2026

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As we wrap up 2025, we’re closing the books on a year that delivered strong markets and a few surprises along the way.

More importantly, the trends taking shape now will help guide the decisions we make together in 2026.

Today, we discuss:

  • How the markets performed in 2025.
  • Why the Fed is likely to cut rates again.
  • Where the job market is showing quiet signs of stress.
  • What GDP growth and corporate earnings suggest for 2026.

2025 Market Review: Better Than Average

It’s been another impressive year for the stock market.

Year-to-date, we’ve seen growth of about 16.5%, following a strong 24% gain in 2024.

For perspective, the market usually averages around 8% to 10% each year, so we’re well ahead of the curve.

The one major bump we faced was a steep (but short-lived) drop in April when new tariffs were announced. This created a lot of uncertainty. Companies that rely heavily on global suppliers, like Walmart, saw their stock dip instantly.

In anticipation of the tariffs first mentioned in February, Walmart’s stock had already begun its decline from a high of $105 per share. When the tariffs were officially announced in April, the stock dropped further from $89 to a low of $82 per share, but it bounced right back. It’s currently trading strong at $115 per share, driven by people looking for better deals and the company’s leadership in online shopping and delivery.1

The good news is that many companies have adapted to the new tariffs.

For example, Walmart has successfully shifted a great deal of its product sourcing from China to India and Southeast Asia, including Vietnam and Thailand.

Ultimately, the tariffs caused uncertainty, but the market bounced back strongly.

Let’s switch gears now, and talk about three financial projections and key themes for 2026…

#1—Continued Rate Cuts

The Fed has a tough job: they must balance keeping inflation near their 2% target (now about 2.8%) while also ensuring the job market stays strong.

This balance is currently fragile.

To counteract the current risks in the economy, the Fed will likely continue to cut interest rates both in December and in early 2026. These cuts aim to lower borrowing costs, give the job market a lift and restore consumer confidence.

As long as the job market doesn’t weaken too fast, these cuts should help maintain steady economic conditions throughout 2026.

Related: We took a closer look at the delicate balancing act of rate cuts in our recent post, Today’s Economy: What’s Actually Going On?

#2—Labor Market Fragility

A key risk to the economy right now is the pressure placed on jobs, with the primary labor market weakness being concentrated in job cuts at small businesses.

This development will likely continue in 2026.

Signs of this trend were apparent in the November 2025 ADP report, with Reuters reporting an unexpected decline in private payrolls. (ADP processes payroll for 1 in 6 workers in the U.S.)2

This data suggests that while big company layoffs make headlines, the real pressure is happening quietly: small businesses are cutting jobs and offering fewer openings.

Read the full Reuters article here: US private payrolls post largest drop in more than 2-1/2 years in November.3

This pressure can create a dangerous self-fulfilling prophecy, consisting of a three-part cycle:

  1. Small businesses cut jobs due to uncertainty.
  2. People who are worried about losing their jobs start spending less money.
  3. The consequent slowdown validates the initial fear, making the prophecy self-fulfilling.

Keep in mind, small businesses are the main source of new jobs.

According to the U.S. Small Business Administration Office of Advocacy, “The U.S. contains 36.2 million small businesses, which account for almost 46% of private sector employment [share of employees]. From March 2023 to March 2024, U.S. small businesses created approximately 9 out of every 10 net new jobs.”4

If this massive engine pulls back on hiring or starts laying off, the overall job market quickly loses its critical source of new growth.

Two Other Points to Consider:

  • The low 4.4% unemployment rate doesn’t yet reflect what’s happening on the ground. Small business layoffs usually take a few months to show up in data, and the recent government shutdown added an extra delay. We’ll see some clarity when the November jobs report is released in mid-December.
  • We’ve yet to see any broad, hard data (enough to say there’s a clear trend) reflecting the real labor efficiency gains that artificial intelligence (AI) is expected to create. Up until now, the evidence we do see is largely anecdotal.

#3—Moderate Economic Growth

Most analysts’ forecasts for 2026 show U.S. economic growth ranging from 1.8% to 3.2%.

Even at the low end, a growing economy generally makes things easier because there’s more “pie” to go around for everyone.

This projected growth is supported by strong corporate earnings and by the fact that the tariffs didn’t lead to the severe economic damage many feared back in April. Remember, market sentiment also drives growth.

Finally, the housing market could provide a significant lift to the economy.

If the Fed continues to cut rates in 2026, it should cause interest rates and mortgage rates to keep coming down—possibly falling into the 5% range (optimistic but plausible). This could encourage more people to buy homes.

When the housing market picks up, it creates a ripple effect across the entire economy: demand increases for repairs, furniture, appliances and other home improvement projects, which in turn boosts thousands of businesses.

Lastly, on the investment side, several major banks are forecasting a 10% to 12% return for the stock market next year. As always, these are just estimates, but they reflect a generally healthy outlook for corporate earnings and valuations as we head into 2026.

Sincerely,

–David Bunker, Financial Advisor & Licensed Fiduciary

Before You Go

Get help optimizing your retirement income. Download our FREE “Prolonging Retirement Income” checklist.

Also, receive help retiring to the life you want, schedule a complimentary financial planning consultation.

This communication was prepared with financial writer Sharron Senter’s assistance, based on interviews with David Bunker, a financial advisor and licensed fiduciary.

Sources:

1: Nasdaq.com, Walmart Inc. Common Stock (WMT), nasdaq.com/market-activity/stocks/wmt/historical

2: adp.com

3: Reuters, US private payrolls post largest drop in more than 2-1/2 years in November, reuters.com/business/us-private-payrolls-unexpectedly-decrease-november-adp-says-2025-12-03

4: U.S. Small Business Administration Office of Advocacy, New Advocacy Report Shows the Number of Small Businesses in the U.S. Exceeds 36 million, advocacy.sba.gov/2025/06/30/new-advocacy-report-shows-the-number-of-small-businesses-in-the-u-s-exceeds-36-million

Happy Thanksgiving + Power of Gratitude, Explained

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With Thanksgiving around the corner, we wanted to take a moment to say how genuinely grateful we are for you.

We truly look forward to working with you every day.

Image by Priscilla Du Preez, Unsplash

Thank you for your trust, your great questions, and the chance to be part of your financial journey.

It means the world to us.

We hope the long weekend brings you time to relax, enjoy good company (and maybe too much pie!).

Happy Thanksgiving to you and your family!

If you have downtime this holiday, you might enjoy this quick, inspiring read on what science says about the power of being thankful. Research shows cultivating an ‘attitude of gratitude’ is a great way to boost overall well-being. Read the article, An attitude of gratitude: What science says about being thankful.1

Warmly,

Dave and Julie

Before You Go

Get help optimizing your retirement income. Download our FREE “Prolonging Retirement Income” checklist.

Also, receive help retiring to the life you want, schedule a complimentary financial planning consultation.

This communication was prepared with financial writer Sharron Senter’s assistance, based on interviews with David Bunker, a financial advisor and licensed fiduciary.

Source:

1: Florida International University, An attitude of gratitude: What science says about being thankful, https://news.fiu.edu/2024/an-attitude-of-gratitude-what-science-says-about-being-thankful

Today’s Economy: What’s Actually Going On?

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There’s been a lot going on in the financial news recently.

Let’s take a closer look at what’s behind the headlines and how we’re responding within your portfolio.

Marriner S. Eccles Federal Reserve Board Building in Washington, D.C.

Today we discuss:

  • Interest Rate Cuts
  • AI Trends
  • Consumer Spending
  • Your Portfolio

Interest Rates: A Delicate Balancing Act

The Fed continues its tug-of-war between trying to reduce inflation and supporting a weakening labor market.

Inflation has fallen sharply (from about 9% in 2022 to about 3% today). However, getting from 3% down to the Fed’s 2% target is proving tricky due to the weakening labor market.

In late October, the Fed cut rates by 0.25%, following a similar move in September.

The key reason for these cuts is the softening job market. The tricky piece is that rate cuts can sometimes lead to inflation.

How?

When the Fed cuts rates, borrowing becomes cheaper for:

  • Consumers (e.g., lower mortgage, credit card and auto loan rates)
  • Businesses (e.g., lower costs for borrowing and new projects)

This generally stimulates spending and investment, which increases overall demand in the economy.

However, if demand outpaces supply, prices rise and inflation follows.

Many analysts anticipate more rate reductions in the months ahead. However, the Fed reiterated during their October meeting that future decisions will depend on incoming data, not political pressure or market expectations.

Consequently, with much of the government still shut down, the Fed’s relying heavily on private sector sources such as payroll data and state-level unemployment claims.

In fact, to help make up for missing data, ADP is now publishing a weekly version of its National Employment Report.1 ADP facilitates payroll for about 1 in 6 workers in the U.S.2

Zooming out, remember the current job cuts are largely a correction for over-hiring during the pandemic, amplified by a slowing economy. Also, the low unemployment rate (currently about 4.3%) suggests the economy is near full employment (meaning nearly everyone who wants a job has one).

AI Trends: Innovation Meets Speculation

AI continues to dominate headlines and investment dollars. While the potential is enormous, profits have yet to catch up with the spending (and likely won’t for some time).

Many of the major players, including Microsoft, NVIDIA and OpenAI are deeply intertwined through partnerships and cross investments.

For Example:

Microsoft has invested billions in OpenAI, which in turn relies on Microsoft’s cloud servers to power its technology.

NVIDIA supplies specialized chips that make advanced AI possible, and also invests in AI ventures like OpenAI.

This circular web of relationships accelerates innovation, however, it also concentrates immense power, which increases risk.

The opportunities are real, but so are the risks.

Insightful AI Resources:

Article: For an in-depth read, check out Capital Group’s recent article, Are we in an AI bubble?3

Podcast: During this podcast, a forensic accountant highlights what others are ignoring in regard to AI and more, No. 1 Forensic Accountant: the Coming AI Collapse.4

Consumer Spending: The 10% Driving the Economy

There’s another trend we’re watching closely: the concentration of spending among higher earners.

The top 10% of Americans now account for nearly half of all consumer spending.5

This dynamic can mask underlying economic weakness, especially if the job market softens further.

Despite headlines about layoffs at big companies, unemployment remains low. However, younger workers entering the job market are finding fewer openings.

Overall, if spending from the “top 10%” slows, it could weigh on GDP growth even without an official recession. Currently, GDP growth is forecasted at a healthy 3%.

Your Portfolio: Staying Prepared, Not Predictive

Periods like this—when economic indicators present a mixed picture—are why we emphasize planning over prediction.

Our disciplined investment process blends diversification, research and risk management to help protect your investments and long-term goals.

For retired clients drawing income, we’ve already set aside sufficient cash reserves to help avoid selling investments during downturns. We’ve also been taking profits from positions that have appreciated sharply and watching for new buying opportunities supported by data—not headlines or hype.

In times of uncertainty, discipline means focusing on what we can control; specifically, how we plan, prepare and respond. Markets will always move, but our process remains steady.

Learn more about our AI diversification approach in our post, AI Is Booming, Diversification Matters.

Sincerely,

–David Bunker, Financial Advisor & Licensed Fiduciary

Before You Go

Get help optimizing your retirement income. Download our FREE “Prolonging Retirement Income” checklist.

Also, receive help retiring to the life you want, schedule a complimentary financial planning consultation.

This communication was prepared with financial writer Sharron Senter’s assistance, based on interviews with David Bunker, a financial advisor and licensed fiduciary.

Sources:

1: ADP, ADP Announces National Employment Report Preliminary Estimate Publicly Available on a Weekly Cadence, https://mediacenter.adp.com/2025-10-28-ADP-Announces-National-Employment-Report-Preliminary-Estimate-Publicly-Available-on-a-Weekly-Cadence

2: ADP, https://www.adp.com

3: Capital Group, Are we in an AI bubble?, https://www.capitalgroup.com/advisor/insights/articles/are-we-in-an-artificial-intelligence-ai-bubble.html

4: YouTube/The Knowledge Project: No. 1 Forensic Accountant: The Coming AI Collapse, https://www.youtube.com/watch?v=E4wXp-DaW8g

5: Morning Brew, The top 10% of Americans account for nearly half of consumer spending, https://www.morningbrew.com/stories/wealthy-americans-account-half-consumer-spending

3 Later-in-Life Conversations; Important Decisions as Life Changes

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With the holiday season approaching, many of us are looking forward to favorite traditions like gathering for a big family dinner, watching a classic movie or relaxing by the fire together.

It’s also an ideal time to discuss how important decisions should be handled as your life changes.

Of course, these conversations are not always easy.

In fact, a new Fidelity study on later-in-life conversations found that as families age, they actually talk less about the topics that matter most.1

Even among financially prepared households, discussions often stall when it comes to three critical issues:

#1—Decision-Making and Change of Control: Who steps in if you can’t make financial or medical decisions?

#2—Dependence and Dependent Living: What’s the plan if living independently becomes difficult?

#3—Thinking Ahead for a Health Incident: Do loved ones know your wishes and how to access important information?

Fidelity’s research shows these conversations drop sharply around age 70, just when they become most urgent.

Also, nearly nine in ten baby boomers say at least one emotional barrier keeps them from talking about later-life issues, including not feeling prepared or not knowing how to start.

According to the study, baby boomers rank thinking ahead for a health incident as one of their most relevant topics. Yet, it’s the topic they’re most unwilling to talk about.

And while many describe their family communication as “open,” two-thirds admit they aren’t actually discussing the topics they consider most relevant.

The study also found that families who have active, ongoing conversations report more confidence that their plans will unfold smoothly, and feel closer as a result.

If you haven’t revisited your plan for these situations, now is the time.

We’re happy to help you:

  • Review or update your powers of attorney and health-care directives.
  • Clarify who makes what decisions and where key documents are stored.
  • Model how long-term care or a sudden health event could affect your finances.

[RELATED]: Longevity plays a major role in how long your plan needs to work for you. We discuss this and two other key considerations in our post, 3 Critical Retirement Planning Dynamics.

Let’s make sure your financial plan reflects both your wishes for care and decision-making.

Sincerely,

–David Bunker, Financial Advisor & Licensed Fiduciary

P.S., In case you missed it, check out our latest blog post: 5 Financial Moves to Make Before Year-End

Before You Go

Get help optimizing your retirement income. Download our FREE “Prolonging Retirement Income” checklist.

Also, receive help retiring to the life you want, schedule a complimentary financial planning consultation.

This communication was prepared with financial writer Sharron Senter’s assistance, based on interviews with David Bunker, a financial advisor and licensed fiduciary.

Source:

1: Fidelity, Later-in-Life Conversations Study, https://www.fidelity.com/bin-public/600_Fidelity_Institutional/fidelityinstitutional/Application/AP168302/family/TGP_LIL_Report_FCFE_FINAL.pdf

5 Financial Moves to Make Before Year-End

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Fall brings more than changing leaves. It’s also an ideal time to revisit your financial plan before the holiday rush begins.

By making a few smart updates now, you can take advantage of valuable year-end opportunities and set yourself up for a strong start to the new year.

Let’s look at five key moves to consider:

#1—Revisit Retirement Plan Contributions

Now’s a great time to revisit your retirement plan contributions.

Even a small bump can make a big difference down the road. Plus, if your employer offers a match, that’s essentially free money. Also, consider directing a portion of any bonus or raise to your retirement accounts.

And don’t forget the power of compounding—it’s what turns small, consistent contributions into meaningful long-term growth.

Learn more in our post: Maintaining Retirement Lifestyles: Compound Interest’s Role

#2—Review Major Life Changes

If you’ve experienced any major life event, please contact us as soon as possible, including:

Employment Changes: New job, raise or retirement coming up? Let’s review your benefits, income, health insurance and tax withholdings. If you’re retiring soon, we’ll also help you determine whether your life insurance is portable and if you still need it.

Family Changes: Marriage, divorce, a new child or caregiving responsibilities? These often require adjustments to estate plans and insurance coverage.

Selling, Buying or Inheriting: Transactions like selling a home or receiving an inheritance can impact your taxes. Be sure to review your 2025 withholdings and be prepared for any capital gains or losses.

#3—Recognize OBBBA Impact

Tax laws changed earlier this year with the introduction of the new One Big Beautiful Bill Act (OBBBA).

One key benefit (the Senior Bonus Deduction) is for those age 65 and older.1

It’s a new “bonus” deduction, including $6,000 for qualifying individuals and $12,000 for qualifying couples. This benefit is in addition to the standard deduction. It’s available to both itemizers and non-itemizers but begins to phase out once income exceeds $75,000 for individuals or $150,000 for couples. This bonus deduction is temporary, and is effective for tax years 2025-2028.

Here are two resources on our website describing key takeaways from OBBBA:

#1—2025 Tax Changes: One Big Beautiful Bill Act (OBBBA) (Includes a “SALT Deduction Savings Example” highlighting how the higher SALT deduction cap now allows many households to deduct more of their state and local taxes than in previous years—and how you may save more by itemizing rather than taking the standard deduction this year.)

#2—Key Financial Data spreadsheet (Includes updated 2025 tax brackets, standard deductions, child tax credit and more.)

If you’d like, we can run year-end tax modeling to show how these changes may affect you.

Our Holistiplan tax software helps us forecast your taxes, model different scenarios, and identify opportunities such as Roth conversions or itemizing under the new, higher SALT deduction cap.

#4—Prepare for Year-End Charitable Giving

If you’re planning to give before year-end, start now to maximize your impact and tax benefits.

Consider using some of the following tax-smart strategies. We’re happy to help you decide which ones fit best.

Appreciated Assets: Donating stocks or mutual funds that have grown in value enables you to deduct their fair market value and avoid capital gains tax.

Donor-Advised Funds (DAFs): Gain an immediate tax deduction by making a contribution now, and enjoy the flexibility of distributing the funds to your favorite charities over time. This is a powerful tool for managing multi-year giving.

[RESOURCE]: Fidelity does a great job explaining what DAFs are, and you can take a quick quiz to see if this resource may work for you (or call us).2

Matching Gifts: Ask your employer if they’ll match your donation.

Qualified Charitable Distributions (QCDs): If you’re 70½ or older, you can donate directly from your IRA to help reduce Required Minimum Distributions (RMDs).

#5— Manage Income to Avoid Future Medicare Surcharges

When managing your 2025 taxes, it’s important to keep IRMAA (Income-Related Monthly Adjustment Amount) for Medicare on your radar.

IRMAA surcharges are based on your modified adjusted gross income (MAGI) from two years prior, meaning your 2025 income will determine what you pay for Medicare premiums in 2027.

Strategic tax planning can help you stay below key IRMAA thresholds by managing income sources such as Roth conversions, capital gains and RMDs. Timing these activities (especially toward year-end) can help reduce future surcharges and keep your overall retirement healthcare costs in check.

Medicare Resources Available on Our Website:

Will I avoid IRMAA surcharges on Medicare Parts B & D?

Medicare Premiums and Deductibles for 2025

BONUS MOVES: Other Tax & Retirement Savings Strategies

  • Roth Accounts: Consider whether shifting from a traditional 401(k) or IRA to a Roth option makes sense given your tax outlook. Remember, withdrawals in retirement from Roth accounts are tax-free, creating flexibility later on (e.g., reducing taxable income in years when you draw more from other sources).
  • Health Savings Account (HSA): If you’re eligible, consider maxing out your contributions. HSAs offer a triple tax advantage; specifically, contributions are tax-deductible, grow tax-deferred and can be withdrawn tax-free for qualified medical expenses. For example, a family contributing the 2025 maximum of $8,550 could reduce taxable income by that same amount, and individuals age 55 and older can add an extra $1,000 catch-up contribution. To qualify for an HSA, you must be enrolled in a High Deductible Health Plan (HDHP).
  • Tax-Loss Harvesting: Even with markets trending higher, we continue to look for tax-loss harvesting opportunities where appropriate to help offset gains and improve your after-tax returns. Keep in mind, if you have other accounts that we don’t manage, be sure to coordinate with us so you achieve maximum impact.

Quick Reminder

Many of the federal energy home improvement credits expire on Dec. 31, 2025. If you’re planning to replace your front door, add better attic insulation or similar, consider doing it now to take advantage of the credits.

Please reach out with any questions.

–David Bunker, Financial Advisor & Licensed Fiduciary

Before You Go

Get help optimizing your retirement income. Download our FREE “Prolonging Retirement Income” checklist.

Also, receive help retiring to the life you want, schedule a complimentary financial planning consultation.

This communication was prepared with financial writer Sharron Senter’s assistance, based on interviews with David Bunker, a financial advisor and licensed fiduciary.

Sources:

1: IRS.gov, One, Big, Beautiful Bill Act: Tax deductions for working Americans and seniors, https://www.irs.gov/newsroom/one-big-beautiful-bill-act-tax-deductions-for-working-americans-and-seniors

2: Fidelity, What is a donor-advised fund (DAF)?, https://www.fidelitycharitable.org/guidance/philanthropy/what-is-a-donor-advised-fund.html

Bay Colony Advisors, DBA Windsor Wealth Management, is not a Certified Public Accountant and does not provide tax, legal, or accounting advice. Any tax-related information provided is for general informational purposes only and should not be construed as legal or tax advice. Each individual’s tax situation is unique, and you should consult with your own tax, financial, or legal advisors before making any decisions. We strongly recommend seeking the advice of a qualified CPA or other professional for personalized tax advice.