Good Financial Cents | Financial Planning and Retirement Blog
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Are You Ready To Take Charge of Your Financial Life?
My wife loves our boxer Klaya. So much that I know that we would go broke if something ever happened to her. There would be no expense spared to make sure that she’s okay. None.
My wife is not the only one.
I had a set of clients that loved their dog. They loved it (her, him, whatever) so much that went it got ill, they drove the dog 3 hours to see a dog specialist. All in all they spent over $3,000 on medical bills trying to fix the dog. Unfortunately, it was all for not.
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The transition from full-time student to full-time employee is challenging enough. There’s so much to think about- what are your benefits, how do you choose your health insurance plan, what is a 401(K) or pension, and most importantly, how do you become that standout employee? Compound that with residing New York City (which has an incredibly high cost of living) and working during an unstable economic environment. Pretty soon you can feel like being an adult is just too overwhelming. Though it might be nice to hide under the covers and hope it will all resolve itself, take this opportunity to explore and learn – especially when it comes to your career and your finances.
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If, like most gainfully employed adults, you have been paying into a 401K plan, you probably know that it is a setup for your retirement. You faithfully put in your allotted percentage from each paycheck before taxation, and if you’re lucky, you have a job with a company that matches up to a certain percentage. Then, if all goes well, you continue to work until retirement age (which is to say, 59½ years old), when you have hopefully saved up enough of a nest egg to support you throughout your twilight years. Unfortunately, there are times when you must begin withdrawing money from your 401K early (due to job loss, sudden illness, early retirement, or any number of other unexpected misfortunes). Whatever the reason, withdrawing funds from a retirement account before maturation can come with a number of drawbacks, so before you do anything, you should know what you’re getting into.
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With the holidays fast approaching, many turn their thoughts to helping others by donating to charity. On top of that, it is not lost on many that you can increase your overall tax efficiency by donating to charity. If you itemize your deductions, the end of the year is a good time to donate if you need to reduce your taxable income before year’s end. Whether you are donating out of the goodness of your heart, or whether you want the tax deduction, or whether it is a little of both, the good news is that donating to charity has never been easier. In some case, you don’t even have to use your own money (but you won’t get a tax deduction for that).
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I‘m not really sure when the day actually happens . I know that I started eating healthier when I was college right when working out became a part of my weekly routine. Protein, carbs and good fats became a regular staple of my vocabulary. One day though, I got a little bit obsessed. And that obsession became fiber. So much of a obsession that I started to count how many grams of fiber I took in a day. Yes, I may need help.
You see, my father had two heart attacks and the second one took his life at the age of 67. From that point on, I’ve watched my diet a lot more than I did in the past (Although, I did hit a bit of a funk and motivated myself to lose 20 pounds). Knowing that heart disease runs in my family, I needed to conscience of what I ate. According to the Cheerios box, fiber helps reduce cholesterol or heart disease. How can you argue with Cheerios?
So I started watching and counting my fiber intake to make sure I was getting a healthy dose. But what exactly is a healthy dose? According to Harvard School of Health, men should shoot for 30 grams of fiber a day in their diet.
If there is one thing that has surprised me over the years of years of being a financial planner is how much you need to know about taxes. Taxes revolve around almost everything in the financial planning process. Retirement account contributions, Roth IRA conversions, required minimum distributions are just a few of the many examples of conversations I’ve had in the past week were that beloved three letter word came up: TAX. As much as taxes do come up, I’ve always had an itch in becoming a Certified Public Accountant (CPA). I’m always jealous of the wealth of tax info that my CPA can spit out on a whim.
I know. I’m weird. Raise your hand if your like me and our jealous of someone and the tax know how.
Anyone?
Yeah, didn’t think so.
Unfortunately, as many projects as I have going right now, the thought of going down that path will have to be for another life and I’ll just continue to rely on my CPA for all the tax stuff I would ever need.
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Business ownership offers many potential rewards: freedom, independence and financial security, to name the biggest. One benefit that is somewhat less discussed, however, are tax breaks. The fact is, business owners are capable of lowering their tax bills in ways that salary or wage employees can only dream of.
Take advantage of these opportunities, and starting a business may wind up being the best legal tax avoidance strategy you ever used.
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Losing a parent is tough. It’s been several years since my father passed away, yet it only feels like yesterday. My father did not have a sizable fortune when he passed so there wasn’t a lot of complication in sorting through his estate. In that sense, we were lucky. I’ve been witness to many clients whose parents did a horrible job of communicating where all their “stuff” was. Don’t be that person. GFC contributor, Les O’dell, shares a personal account on how you can be better prepared with your estate planning. Introducing Les……
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According to Wikipedia weapon of mass destruction (WMD) is a weapon that can kill and bring significant harm to a large numbers of humans (and other life forms) and/or cause great damage to man-made structures (e.g. buildings), natural structures (e.g. mountains), or the biosphere in general.
WMD’s can harm innocent people and there’s no stopping them. Currently, I’m creating a list of the “Financial Weapons of Mass Destruction”. These are product or services that I feel that offer no real value and are causing great harm to the financial health of many Americans. Topping that unpopular list would be Payday loans. I’ve been fortunate to have never had a direct run in with payday loans. It wasn’t until I had a meeting with someone that was approaching retirement, that I truly learned how evil they can be.
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The passage of health care reform several months ago came with promises that some almost immediate changes would be coming. While a number of the biggest changes will wait until 2014, there are nevertheless changes just recently gone into effect that will affect you now. Here are some of the changes that are in effect right now — and that may mean some savings for you, depending on your plan. Remember, though, that these changes won’t go into effect until your policy is renewed. For some, this is October 2010, and for some it may be January 2011. If your enrollment has already passed, you may have to wait until a little later to see of these changes. Pay attention to open enrollment this year, and you might notice some of these changes:
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If you are the proud owner of either an Android, or the iPhone, you have access to some great tricks to control your finances you might not even be aware of. Even my Blackberry has some pretty cool apps, but I’m still drooling over the new iPhone. There are thousands of apps out there for both the Android and the iPhone. Sticking to the personal finance realm, I have compiled what I consider to be the best financial planning and investment apps out there. Most of these apps can be found on both the Android and the iPhone, however some are exclusive. Whether they will remain exclusive to either system for long is probably unlikely due to the fierce competition in the app world, but for now there are some perks to owning a specific one.
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Jeff Rose is a CERTIFIED FINANCIAL PLANNER™ professional and founder of Alliance Wealth Management, LLC.
Learn more on Good Financial Cents. Read more on my about page and learn more on personal finance, financial management and how to dump your debt.
Alliance Wealth Management, LLC
Jeff Rose, Certified Financial Planner™
115 S. Washington St.
Carbondale, IL 62901
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Mortgages Haunt Corporate Bonds
by Jeff Rose
Halloween is still several days away but the mortgage market has decided to spook the corporate bond market a bit early. The Mortgage-Backed Securities (MBS) sector was logically the first to come under scrutiny from the mortgage foreclosure problem but oddly enough, it is the Corporate Bond Sector that grapples with potential ramifications of the mortgage foreclosure mess. The possibility of “put-backs,” the process by which banks will be forced to repurchase a witches brew of non-performing loans and foreclosed properties back onto their balance sheets, has led to modest weakness in Corporate Bonds, concentrated primarily among bonds issued by financial companies.
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