Financial Advice

  • Welcome to A Deeper Look series. One of the ways of understanding finance is understanding many of the terms you are not used to hearing every day. These terms may sometimes be confusing, so it helps to get some background and perspective.

    Today, I would like to share the term “asset allocation.” Asset allocation is an investment strategy that incorporates the risk tolerance and investment time horizon of the investor. It may sound simple, but there are many ways to allocate assets within an investment portfolio. Most approaches consider three main sets of asset classes: equities, fixed-income and cash or cash equivalents.  Each class has a different level of risk and expected return, and each will generally perform differently than the other. There are additional classes such as “alternatives,” real estate and precious metals that can also be considered as part of an allocation.

  • After every national election cycle, the world of financial planning changes in some way. It may be big changes coming down the pike, or changes in the details. Advisors work to field through the changes to make sure clients are getting the best advice they can offer. This election cycle is no different and looks to have big changes coming your way. The first area targeted for change is the Healthcare Law. With reference to Health Savings Accounts being proposed as a significant component, it may help to refresh our memories on what these are and how they’re used.  

    Health Savings Accounts (HSAs) were introduced in 2004 and were coupled with High Deductible Health Plans (HDHPs).  It’s always important to verify that the insurance plan is HSA-eligible. The HSA is a separate account that an employee, employer or private policy holder contributes money to during the year. The premise of these accounts was to help curb the growing cost of health insurance and to put the insured patient more in control of their healthcare. The pre-tax contributions are much like a traditional 401(k) or IRA. The account can then be tapped to pay for qualified medical expenses. If money is used to pay for non-qualified medical expenses, it will be taxed and will include a 10% penalty.

  • Truth, responsibility, respect, compassion and fairness tend to be the global understanding of the values we associate with ethics. But what about financial ethics? How do we teach our children to be ethically responsible with money?

    Research shows that the best way to teach children morals and ethics is through example. From an early age, children observe their parents spending, saving and discussing money. They pick up on their parents’ views regarding money just by watching them.  

  • In our previous article, we reviewed five tips that parents could teach kids on being ethically responsible with money. This week, we’ll continue our financial education discussion with how we can teach kids about budgeting and saving from an early age.  

    How many of us wish we were taught more about money during our childhood? One of the best ways to help our kids avoid financial mistakes in the future is to teach them to manage money.

    According to an EverFi, Inc recentsurvey, “More than a quarter of students believe they will be unprepared to manage their finances upon high school graduation. In addition, students surveyed demonstrated that they do not understand basic financial facts and concepts.” Teaching kids basic financial tasks like developing and sticking to a budget will result in strong habits that they can carry into the future. So, now the question is, what financial skills do you teach them? Well, it really depends on how old they are.

  • It’s a horrible situation to be in, but it’s one that is all too common. A loved one becomes seriously or terminally ill, and insurance does not cover even half the costs. Not only does the family worry about their loved one, then, they begin to wonder where the funds will come from to pay for quality care. But this is not a blog about health insurance or long term care insurance. It’s about having an emergency fund.

  • Just a few weeks ago a surprising statistic showed up in one of our blogs. Over half of single women have a moderate or heavy amount of anxiety about dealing with finances. Many single women are successful in their chosen field and many are business owners. American Express commissioned a study this year that found the number of women-owned firms increased by 45 percent between 2007 and 2016. Many of these women are sole owners, showing us that the idea of successful single women can be a spectrum from personally single to business single and personally attached.   

  • Are you debating switching from your current Medicare Advantage plan to Medicare Supplement Insurance? Before you decide, let's do a quick review of the differences between the plan types:

  • In order to make a living wage today in the U.S., employees are required to have at least a four-year degree. At the same time, the cost of tuition has been on a continuous rise. So for generations X and beyond, student loan debt makes up a large chunk of their total debt. Four short years at college could potentially take decades to pay off if you’re just making minimum payments.

    There is hope, however. There are options to pay off debt quickly, get lower interest rates or in some cases, have the debt forgiven. Here are some of your options to chip away at student loan debt so that you can have a little more breathing room in your budget.

  • A new marriage is an exciting event. If the marriage includes blending a family, this can be even more exciting – the more the merrier in some cases, right?

  • So, you’re thinking about adopting a child. We think that’s admirable. But while raising children can be rewarding, there are also many financial considerations. Adoption comes with its own set of financial challenges. For some people, the question becomes, how can they best provide for their child financially as well as emotionally?

    The Cost of Adopting a Child

    According to the Child Welfare Information Gateway’s Planning for Adoption: Knowing the Costs and Resources, the average U.S. private agency adoption costs can range from $20,000 to $45,000, and international adoptions can average between $20,000 to $50,000. While both of those are great opportunities for some families if finances are planned accordingly, for others, the costs associated with the process can be disheartening. There is another option, however – adopting a child in foster care.

  • Last time, we discussed the various adoption opportunities(private, international and foster care) along with the average cost associated with each. We also walked through the basic steps for adopting one of the 428,000 children currently in foster care. In this article, we will review the different financial assistance available for those adopting children in foster care.

    Financial Adoption Resources

    In addition to Federal and State financial assistance for children adopted from foster care, families may be able to access employer-provided adoption benefits, tax credits, and loans or grants to offset adoption expenses.

  • We talk a lot about financial education in this blog, especially as it pertains to our youth. But what about our entrepreneurs, seasoned business owners and executives who have experience in their fields but not in finance? What happens to them in business and in life if they do not become educated?

  • Years ago, in many junior and senior high schools, our youth attended classes about basic budgeting and finances. And often, the only classes were part of a Home Economics track as Life Skills. Sadly, along came budget cuts, and these classes were removed. During my career, I have spent some time in classrooms as a guest teacher, sharing insights and tips for students to become more financially savvy.

  • The beginning of the new year is an excellent time to review your financial goals and set your resolutions. Financial resolutions can help you successfully reach your short- and long-term goals. Financial goals could include items like going on a fabulous vacation, purchasing a new home or increasing retirement savings.

  • Estate planning is one of those topics that often makes people uncomfortable. Most of us don’t want to think about what’s going to happen after we die, or some of us feel like we don’t have enough assets to warrant needing an estate plan. The truth is everyone needs a plan. Your estate is comprised of everything you own — your car, home, other real estate, checking and savings accounts, investments, life insurance, furniture and other personal possessions. So, no matter how modest your estate might be, you’ll still want to manage who receives each item and when they receive it. You’ll also want to include medical and financial directives so others know your wishes. Here are five simple components of an estate plan.

  • Thinking about purchasing a home but worried you can’t afford it due to student loans? You aren’t alone. According to a study by American Student Assistance, “55 percent of student loan holders said their debt is causing them to put off homeownership.” Most of them believe their student debts would make purchasing a home impossible. The reality, however, is that owning a home is possible even with student debt. Here are some tips on how to purchase a home while still paying off student loans.

  • Last week I wrote about what individual taxpayers can expect in 2018 under the new 2017 Tax Cuts and Jobs Act Law. Now, let’s take a look at the business side of things. The purpose of this blog is to highlight things that taxpayers understand, not what they expect their accountants and financial professionals to know. In other words, we won’t get “into the weeds.”

    For more details, this article “What Tax Reform Means for Small Businesses & Pass-Through Entities”  by Forbes writer Kelly Phillips Erb covers a lot of ground. I will bullet the major points to highlight areas that you may want to spend more time understanding in light of your business situation. The new laws are still being interpreted and we can expect more clarification from the IRS in the coming months.

  • The 2017 Tax Cuts and Jobs Act has become law, and it will go into effect for the tax year 2018. For many, there will be benefits and savings. For others, there may be some adjustments to be made. Although this law simplifies the tax code, there is still quite a bit of information to wade through. It will take several pages to go through all of the changes, but I will focus on some major items now and more in future posts.

  • Many older adults will require long-term care at some point during their lives. Long-term care is defined as requiring assistance with at least two “activities of daily living” (eating, bathing, toileting, dressing, continence or transferring from a bed to a chair) that lasts at least 90 days, or a need for substantial assistance due to severe cognitive impairment. According to a report by the U.S. Department of Health and Human Services, “more than 6 million older Americans are thought to have a high need for long-term care. Yet fewer than 10 percent of older adults have purchased long-term care insurance because it’s expensive.” So how do you get long-term care without breaking the bank?

  • A financial advisor is a professional who helps you manage your finances and investments, teaches you about important options and aids you in making smart decisions toward your overall financial goals. But did you know that in order to maintain their license, your financial advisor must pass a rigorous national examination and complete ongoing educational requirements annually? Certified Public Accountants (CPAs), Chartered Financial Analysts (CFAs) and Certified Financial Planners (CFPs) must adhere to a strict code of ethics and work in the best interest of their clients, disclosing any conflicts of interest. These advisors must act as a fiduciary, and typically are paid solely from client fees and do not sell products. They truly value their relationship with you, the client.

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