Archive - February 2013

1
Don’t Rely On A Straight-Line Model For Your Retirement Planning
2
What Should You Do If You’re Missing a W2?
3
What’s A Safe Portfolio Withdrawal Rate?
4
Financial Planning Can Help You Avoid Financial Infidelity
5
How Dollar-Cost-Averaging Can Work To Your Advantage For Your 401(k)

Don’t Rely On A Straight-Line Model For Your Retirement Planning

You might have a hard time believing this is actually out there, but make sure you don’t use a straight-line model in retirement planning when you try to determine the appropriate amount of withdrawals you can take from a portfolio without running out of money. Using the straight-line method, the software will assume that you earn the average return every year on your asset allocation and that you are taking a fixed dollar amount out every year, adjusting it annually for inflation.

Assuming that your portfolio is half in stocks and half in bonds, the software may assume that you …

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What Should You Do If You’re Missing a W2?

By now you should have received your W2’s for 2012, since employers should have sent them out by the end of January.  If you haven’t received one yet, there are several things that you can do to be able to file your taxes on time.

Recently the IRS issued their Tax Tip 2013-10, which gives guidance for folks who have not received their W2 in a timely manner.  The actual text of the Tip is below:

Missing Your W-2? Here’s What to Do

It’s a good idea to have all your tax documents together before preparing your 2012 tax return.  …

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What’s A Safe Portfolio Withdrawal Rate?

How much can you withdraw annually from your investment portfolio to be sure you don't outlive your money? If you regularly read investment articles, you know that this issue is often debated. Scenarios are analyzed, and various inflation rates, historical investment rates of return, and life expectancy projections are compared.

While these are key and critical exogenous issues if you are managing billions of dollars in pension investments, if you are a real person it is the endogenous factors that are important when you decide how much money to take from your retirement portfolio. Endogenous factors include living within your …

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Financial Planning Can Help You Avoid Financial Infidelity

If you are married or live with your partner, your financial planning should involve your spouse, but for various reasons, a number of people find it difficult to be honest with a partner about money and spending.

In “Financial infidelity has its costs,” USA Today looked at the results of a survey with conflicting messages: “Sixty-three percent of men and 70% of women said they think honesty about money is as important as remaining monogamous.” and yet, “Lying to a partner about money was admitted by 56% of women and 37% of men in the poll.” We prize honesty in …

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How Dollar-Cost-Averaging Can Work To Your Advantage For Your 401(k)

When you invest in your 401(k) plan with salary deferrals from each and every paycheck, you are taking part in a process known as Dollar-Cost-Averaging (DCA).  This process can be advantageous when investing periodically over a long span of time, by smoothing out the volatility of the market and giving you an average cost of your investment shares over time.

How does this work, and how can it be advantageous?

Dollar-Cost-Averaging

When deferring income with each paycheck, typically you will be investing in your 401(k) plan each pay period, whether monthly, bi-weekly, or weekly.  Each pay period the same amount …

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