Let’s talk a little bit about tax credits and tax deductions.
Both can be used to help reduce or avoid taxation but behave differently when it comes to doing so.
Tax deductions are beneficial because help lower the amount
of your income subject to taxation. Deductions may be either “above the line” or for AGI, or “below the line” or from AGI. The line in the sand in this
scenario is of course, AGI (adjusted gross income).
Above the line deductions are beneficial because they reduce gross income to arrive at AGI. A lower AGI may result in being able …Read More
By Eve Kaplan, CFP®
We’re celebrating 10 years of a remarkable bull market in US stocks. Here are 5 lessons reinforced during this time:
Lesson 1: Stay the Course When Things Get Rough
The 2008-09 crash seemed to be The End of the World because the entire banking system (with knock-on effects worldwide) was in meltdown mode. If you put extra cash into the US market in 2008-09 then you made out like a bandit. But most investors didn’t have the nerve or extra cash to add to existing investments, so they either 1) DID NOTHING (“stayed the course”) …Read More
Having an emergency fund is important in nearly every stage of life, but having one in retirement is essential. Most retirees are no longer earning income and are living off a fixed income from retirement accounts and/or Social Security. Therefore, it could be argued that you should have a loftier savings fund in retirement than while you are working. Emergencies can happen to anyone at any age, but the things that are likely to come up in retirement years are usually more expensive, such as healthcare costs, dental work, and expenses associated with long-term care needs. Many retirees are still living in …Read More