Athletes and coaches, you may need liquidity suddenly:
- New housing
- Career shifts
- Off-season
- Relocation
- Training costs
- Taxes
Selling investments to cover these may trigger taxes and potentially reduce long-term growth potential.
A box spread lending strategy may help you access cash at potentially lower rates, without disrupting
your overall plan.
Instead of traditional financing a box spread lending strategy may help:
- Access cash faster
- Avoid the underwriting process
- Preserve your monthly cash flow
- Borrow at possibly lower rates
- Potentially minimize or avoid tax implications
- Keep your investments invested
This strategy can help with financial flexibility during unpredictable moments.
Potential risks:
- Market risk: If the portfolio used to support the box spread declines significantly, additional
capital may be required to maintain the structure
- Liquidity risk: Box spreads rely on options markets. Early exits or adjustments can be less
straightforward than a bank loan
- Interest rate considerations: Changes could affect the effective rate if adjustments are needed
- Margin risk: if the value of your collateral falls, you may need to add cash or liquidate securities
- This strategy involves derivatives and requires precise execution, monitoring, and experienced
oversight. Not suitable for all investors.
If you want to learn more about this strategy, reach out to see if it could work for your situation.
Noah Ellison, CFP®, MBA
Helping you build, protect, and create a legacy.
Retirement Planning Solutions, LLC is an SEC registered investment adviser. SEC registration does not
constitute an endorsement of Retirement Planning Solutions, LCC, by the SEC nor does it indicate that
Retirement Planning Solutions, LLC has attained a particular level of skill or ability. This material
prepared by Retirement Planning Solutions, LLC is for informational purposes only. It is not intended to
serve as a substitute for personalized investment advice or as a recommendation or solicitation of any
particular security, strategy or investment product. Options involve risk and are not suitable for all
investors. Trading options can result in the loss of the entire investment and, for certain strategies,
losses may be unlimited. Investors should understand the characteristics, risks, and obligations of
options before trading. Prior to trading, investors must review the Options Clearing Corporation’s
Characteristics and Risks of Standardized Options (ODD), available from your broker or the OCC. Past
performance does not guarantee future results.
Advisory services are only offered to clients or prospective clients where Retirement Planning Solutions,
LLC and its representatives are properly licensed or exempt from licensure. No advice may be rendered
by Retirement Planning Solutions, LLC, unless a client service agreement is in place. This material is not
intended to serve as personalized tax, legal and/or investment advice since the availability and
effectiveness of any strategy is dependent upon your individual facts and circumstances. Retirement
Planning Solutions, LLC, is not a legal or accounting firm. Please consult with your legal or tax
professional regarding your specific tax situation when determining if any of the strategies mentioned
are right for you.