Archive - 2018

1
Avoid Retirement Plan Fees and Penalties
2
Bond Basics
3
Fathers, Daughters, and Financial Planning
4
Adding inSALT to Tax Injury
5
Ugh! UTMAs and UGMAs

Avoid Retirement Plan Fees and Penalties

The main message about retirement is that you need to save (and you do!) but once you have some retirement savings, you also need to make sure you maximize your savings by not paying fees you need not pay. There are ways in which fees and penalties can eat into the resources you work so hard to save.

U.S. News & World Report offers information on “5 Retirement Fees You Should Never Pay” to get you thinking about how you can use your retirement money to benefit you instead of paying penalties.

Early withdrawal penalties: You may …

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Bond Basics

Bonds are boring, but smart investors use them for stability, diversification, and upcoming withdrawals. Understanding some basics will help you evaluate the risks and rewards of owning bonds in your portfolio.

What is a Bond?

A bond is essentially an “I.O.U.” You become a bondholder when you lend money to the government, a corporation, or a municipality. In exchange for your money, the bond issuer promises to pay interest periodically and repay principal equal to the bond’s face value at the end of a specific time period.

Consider a company that needs to build a new facility costing $2 million. …

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Fathers, Daughters, and Financial Planning

Women recount their experiences, good and bad, with their fathers and finance in “Father, Daughters and Dollars: How Dads Influence Our Views on Money.” Amy Keyishian, the author of this article from LearnVest, wrote it as a followup to an article she wrote about mothers and money but found that the women she spoke with were less lighthearted when it was time to talk about their dads and dollars: “It seems that disagreements over finances can damage a father-daughter relationship as much as it can damage a marriage.”

After consulting with psychology professor, Keyishian found that many …

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Adding inSALT to Tax Injury

Ever since I became a tax preparer in 1980, a federal deduction for state and local income, property or sales taxes have been available to taxpayers as an itemized deduction, generally without limitation. The idea behind the deduction, at least as it relates to state income taxes, is to grant taxpayers some degree of relief from double or triple taxation of the same income.

Of course, each year, thousands of professionals use their creativity and ingenuity to try to figure out the best ways to lower your federal taxes, including optimization of your state and local tax deduction. You know …

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Ugh! UTMAs and UGMAs

I’m not sure why anyone has these accounts anymore, but they do. I mostly see them during divorces, where one spouse has tried to transfer money to the kids in hopes of keeping it out of the divorce joint property. Technically, these accounts are considered property of the children (not marital), but as with so many other financial issues, it’s largely up to what the attorneys are able to negotiate.

Funding these accounts is a pretty poor idea in most cases, however. What you’re doing is putting all the money in the kid’s name: they’re entitled to it at 18 …

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