Financial Planning2020-01-03T20:56:39+00:00

Financial Planning

Social Security Retirement Benefits

Social Security was originally intended to provide older Americans with continuing income after retirement. Today, though the scope of Social Security has been widened to include survivor, disability, and other benefits, retirement benefits are still the cornerstone of the program. Read More

Deciding When to Retire: When Timing Becomes Critical

Deciding when to retire may not be one decision but a series of decisions and calculations. For example, you'll need to estimate not only your anticipated expenses but also what sources of retirement income you'll have and how long you'll need your retirement savings to last. You'll need to take into account your life expectancy and health as well as when you want to start receiving Social Security or pension benefits, and when you'll start to tap your retirement savings. Each of these factors may affect the others as part of an overall retirement income plan. Read More

403(b) Plans

A 403(b) plan is an employer-sponsored retirement plan for certain employees of public schools, tax-exempt [501(c)(3)] organizations, and churches. The employer can purchase annuity contracts for eligible employees, or establish custodial accounts to be invested in mutual funds or other investments. In the case of annuity contracts, a 403(b) plan is sometimes referred to as a tax-sheltered annuity (TSA) plan. Read More

Understanding Social Security

Approximately 69 million people today receive some form of Social Security benefits, including retirement, disability, survivor, and family benefits. (Source: Fast Facts & Figures About Social Security, 2020) Although most people receiving Social Security are retired, you and your family members may be eligible for benefits at any age, depending on your circumstances. Read More

Taxation of Investments

It's nice to own stocks, bonds, and other investments. Nice, that is, until it's time to fill out your federal income tax return. At that point, you may be left scratching your head. Just how do you report your investments and how are they taxed? Read More

Six Keys to More Successful Investing

A successful investor maximizes gain and minimizes loss. Though there can be no guarantee that any investment strategy will be successful and all investing involves risk, including the possible loss of principal, here are six basic principles that may help you invest more successfully. Read More

Common Stock vs. Preferred Stock

Common stock and preferred stock are the two main types of stocks that are sold by companies and traded among investors on the open market. Each type gives stockholders a partial ownership in the company represented by the stock. Despite some similarities, common stock and preferred stock have some significant differences, including the risk involved with ownership. It's important to understand the strengths and weaknesses of both types of stocks before purchasing them. Read More

Income Tax Planning and 529 Plans

The income tax benefits offered by 529 plans make these plans attractive to parents (and others) who are saving for college or K-12 tuition. Qualified withdrawals from a 529 plan are tax free at the federal level, and some states also offer tax breaks to their residents. It's important to evaluate the federal and state tax consequences of plan withdrawals and contributions before you invest in a 529 plan. Read More

Leaving Your Job? Your Retirement Savings Plan Options

Are you leaving your job and considering whether to take a distribution from your 401(k), 403(b), or governmental 457(b) plan? if so, make sure you've considered all your options. In general, you have the following four options when you're eligible to receive a distribution from your employer retirement savings plan. Read More

Investing for Major Financial Goals

Go out into your yard and dig a big hole. Every month, throw $50 into it, but don't take any money out until you're ready to buy a house, send your child to college, or retire. It sounds a little crazy, doesn't it? But that's what investing without setting clear-cut goals is like. If you're lucky, you may end up with enough money to meet your needs, but you have no way to know for sure. Read More

Rolling Over Funds from an Employer Retirement Savings Plan: What You Need to Know

When you roll over a distribution from a 401(k), 403(b), or governmental 457(b) plan, you generally don't pay any taxes until you receive a distribution from the new plan or IRA. If you take a distribution but don't roll it over, it will be subject to federal (and possibly state) income taxes (except for any after-tax contributions you've made); and if you haven't yet reached age 59½, you may also be subject to a 10% early distribution penalty tax unless you're eligible for an exception. Read More

Estimating Your Retirement Income Needs

You know how important it is to plan for your retirement, but where do you begin? One of your first steps should be to estimate how much income you'll need to fund your retirement. That's not as easy as it sounds, because retirement planning is not an exact science. Your specific needs depend on your goals and many other factors. Read More

Are You an Investor or a Speculator?

Recent market news — around social-media driven stock trading that created extreme price swings for shares of certain companies — may have you wondering whether you should jump into the excitement. Before you leap, you might consider this advice from legendary investor and teacher Benjamin Graham, considered the father of value investing: "The individual investor should act consistently as an investor and not as a speculator." Read More

Introduction to Designing and Managing an Investment Portfolio

Once you've identified your financial and investment goals and assessed your investing personality, you'll need to create an investment portfolio that fits your needs and understand what's involved in managing that portfolio on an ongoing basis. Entire books--actually, shelves full of books--have been written about ways to design and manage a portfolio, so this discussion obviously can only serve as a basic introduction to the process. However, it can help you understand the challenges involved and decide just how much assistance you might need, as well as how involved you want to be in managing your portfolio on an ongoing basis. Read More

Taxation of Investments

It's nice to own stocks, bonds, and other investments. Nice, that is, until it's time to fill out your federal income tax return. At that point, you may be left scratching your head. Just how do you report your investments and how are they taxed? Read More

Understanding Probate

When you die, you leave behind your estate. Your estate consists of your assets — all of your money, real estate, and worldly belongings. Your estate also includes your debts, expenses, and unpaid taxes. After you die, somebody must take charge of your estate and settle your affairs. This person will take your estate through probate, a court-supervised process that winds up your financial affairs after your death. Read More

Conducting a Periodic Review of Your Estate Plan

With your estate plan successfully implemented, one final but critical step remains: carrying out a periodic review and update. Imagine this: since you implemented your estate plan five years ago, you got divorced and remarried, sold your house and bought a boat to live on, sold your legal practice and invested the money that provides you with enough income so you no longer have to work, and reconciled with your estranged daughter. This scenario may look more like fantasy than reality, but imagine how these major changes over a five-year period may affect your estate. Read More

Understanding Risk

Few terms in personal finance are as important, or used as frequently, as "risk." Nevertheless, few terms are as imprecisely defined. Generally, when financial advisors or the media talk about investment risk, their focus is on the historical price volatility of the asset or investment under discussion. Read More

Investment Planning Throughout Retirement

Investment planning during retirement is not the same as investing for retirement and, in many ways, is more complicated. Your working years are your saving years. With luck, your income increases from year to year as you receive promotions and/or pay raises; those increases offer some protection against rising costs caused by inflation. Read More

What Are Required Minimum Distributions And How Are They Calculated?

Required minimum distributions (RMDs) are the amounts that you must withdraw each year from your traditional IRA, employer-sponsored retirement plan, or tax-sheltered annuity. (Lifetime minimum distributions are not required from Roth IRAs, but your beneficiaries generally must take distributions following your death.) You must begin to take the annual distributions by April 1 of the year following the year in which you reach age 72. Read More

Closing a Retirement Income Gap

When you determine how much income you'll need in retirement, you may base your projection on the type of lifestyle you plan to have and when you want to retire. However, as you grow closer to retirement, you may discover that your income won't be enough to meet your needs. If you find yourself in this situation, you'll need to adopt a plan to bridge this projected income gap. Read More

10 Years and Counting: Points to Consider as You Approach Retirement

If you're a decade or so away from retirement, you've probably spent at least some time thinking about this major life change. How will you manage the transition? Will you travel, take up a new sport or hobby, or spend more time with friends and family? Should you consider relocating? Will you continue to work in some capacity? Will changes in your income sources affect your standard of living? Read More

Common Factors Affecting Retirement Income

When it comes to planning for your retirement income, it's easy to overlook some of the common factors that can affect how much you'll have available to spend. If you don't consider how your retirement income can be impacted by investment risk, inflation risk, catastrophic illness or long-term care, and taxes, you may not be able to enjoy the retirement you envision. Read More

Creating an Investment Portfolio

You've identified your goals and done some basic research. You understand the difference between a stock and a bond. But how do you actually go about creating an investment portfolio? What specific investments are right for you? What resources are out there to help you with investment decisions? Do you need a financial professional to help you get started? Read More