New Year, New Financial Goals

Here are some suggestions to get started…


1)Â Â Â Â Â Set Realistic Goals First, ask the right questions and stay the course until you’ve found the answers. Goals that are shared are ten times more likely to be acted on. Don’t wait until you have everything set up to seek out accountability.


2)Â Â Â Â Â Make those goals concrete and then document them. Set your savings goals as a specific annual percentage of your adjusted gross income (AGI). It’s a great idea to save at least 10% of your AGI in tax-deferred retirement accounts and another 5% toward retirement in taxable investments. If you are behind on your savings, you may want to save even more in order to catch up.


3)Â Â Â Â Â Craft the best strategy to implement your goals, including prioritizing the appropriate retirement vehicles. Start by investing just enough to get the entire match from a company’s 401(k) plan (if you have one) and then fund your Roth IRA accounts next. After these two, make certain you have enough non-retirement savings.


4)Â Â Â Â Â And this is a BIG deal– automate your plan. Automating putting money in an employer-defined contribution plan is easy. Automating a taxable savings plan is just as painless. Most banks or brokers offer an automatic money link between an investment account and a checking account. They should also offer a monthly automatic transfer between the two accounts.


But I will say one last thing: the most critical component of wealth management in the new year will be tax minimization. With the potential for tax rates to fluctuate even more than the stock market in 2011, it’s never been more important to monitor what “Uncle Sam” is seeking to take from your wallet!

Posted on February 1, 2011 Read More

Questions Which Might Affect Your 2011 Tax Bill

There may be a few moves we can make that can help your tax hit before we’re forced into “reaction mode” — which is the only mode out of which after-the-fact tax work can be done. So, if at all possible, I’d like to change that paradigm for you by having you answer a few short questions…

So, without further ado — some questions for you:

Have you had a significant change in your wage income this year?
Have you taken capital gains or losses this year? Are you planning to?
Did you start or sell a business this year?
Did you purchase real estate?
Did you make your full contributions to retirement accounts?
Have you considered a Roth IRA?
Did you withdraw from retirement accounts, and for what purpose?
Are there any other issues you think we should know about?

Now — the answers to these questions form the “tip of the iceberg”, and they will help us to know which direction to take as we work with you.

Posted on January 1, 2011 Read More

Uncertainty: The root of a slow economy?

Why? There is no clear path to answer the question “What are my costs going to be?” What are Congress and the President going to do with regard to the Bush Tax Cuts quickly approaching their sunset expiration dates? Speculation is that there is some behind the scenes negotiating occurring. More and more economists are saying we need at least 2 more years at the current tax rates to climb nudge the economy forward at a faster pace of recovery.

We are also hearing more and more businesses coming out with projected increases in the cost of healthcare based on the federal legislation and mandates handed down to the states. Companies by the dozens are beginning to request exemptions from the requirements of the legislation. Many are contemplating cutting health insurance from their benefits packages, thereby, pushing their employees to the exchanges. Small business makes up a significant majority of employers. Many don’t have the resources to research the 1,000 plus page health care bill to determine what the impact is to them.

Uncertainty impacts consumers as well. They too are “holding” cash. None of us know what our tax rates are going to be come 2011. Many may not know exactly how much their tax bill is going to be until they receive their first pay check in January. If you’re attempting to do a budget for personal cash flow statement for 2011, how do you fill in that blank?

Do you know what your employer is going to do with your employer provided health benefit yet? The cost of company provided employee health insurance is likely going to go up if it hasn’t already. If it has, there is no guarantee it won’t continue to rise as the mandates continue to be implemented and companies begin to understand their true costs associated with this benefit. Companies are likely going to ask employees to at least share in the increased costs. That will reduce your discretionary spending.

Uncertainty impacts both business and consumers. Business aren’t investing in capital projects or hiring new employees to grow. Consumers are holding more of their discretionary funds and not “investing” in the economy. This seems to have created stagnation in the economy. Consumer confidence and spending will truly be tested in a few weeks as Black Friday quickly approaches.

Posted on December 1, 2010 Read More

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