Short answer: because no one can hit a moving target. The financial plan informs all financial decisions: how to invest, what to save and where, and what insurance should I purchase or drop.
At the time you made your appointment you would have discussed your concerns with one of our associates. After determining if you would be a good fit to work with us, you have been given a list of documents to upload for the financial planners to view before your meeting.
When you come in we’ll meet in one of the conference rooms at our Miami office. We’ll give you a bit of personal introduction and will be interested to learn how you came to us.
From there, we listen and ask questions. We want a general snapshot of your financial position, and we’ll really want to understand your specific concerns and goals for our engagement.
Toward the end of this initial...
Getting financially organized before retirement can be a daunting task. There are many unknowns and it can be hard to know where to begin. For that same reason people often wait too long to address retirement needs and, unfortunately, don’t achieve the financial freedom for which they long. When people get serious about retirement, many start by analyzing their investment account(s) (or lack, thereof). Ideally, they’ll meet with a CERTIFIED FINANCIAL PLANNER™ professional to get them on track.
Financial organization starts by identifying and prioritizing what is most important to you. This is the beginning of a goals-based financial planning approach.
I start by asking clients to list what is most important to them and help them identify what they’d like to accomplish. Spending more time with family, traveling, volunteering, reading, relocating, starting a new...
Do you have a Flexible Spending Account available to you through work? These can offer tremendous tax savings. As you do your research, note that FSAs are of two sorts: The Healthcare FSA and the Dependent Care FSA.
A flexible spending account (FSA) is offered as an elective benefit by many employers. This is part one of a two-part series. Here I describe the healthcare flexible spending account. You’ll find my post on the dependent care FSA here.
This account allows workers to contribute, through payroll deduction, to accounts that are designated for qualifying medical or dental expenses not covered by insurance. All amounts contributed are pretax and funds are not taxed when spent on qualifying health care costs – this is a big tax advantage. The FSA owner can use the funds for deductibles, co-payments, and co-insurance for the employee’s...
All financial planning begins with cash flow planning – your budget, in other words. Sometimes people recoil from that word - budget. To them the word is fraught with negative connotation: I can't spend! Not in my budget! I'll have to deny myself! Life will become intolerable!
Turn this around, though. If you have a cash flow plan, i.e budget, you have freedom within the form. This spending plan keeps you focused on working toward achieving your financial goals. You know exactly how much you can spend on eating out this month, in other words, and still achieve your monthly savings goal to retire with an income of $X at age 67.
Think this through carefully: How much do I need in my emergency fund? How much debt do I have to repay? What interest rates am I being charged? How much should I accumulate in my retirement...
In this post I’d like to give a little history and background on the advice industry. It may not grab you right off as being the most compelling reading, but please stick with it. I have some valuable points to develop. In Part II I go into some of the changes in our regulatory environment.
When I was a young teen I remember going with my father to visit his stockbroker. Dad used the occasion to teach me what owning common stock means (an ownership stake in a publicly-traded company). He explained that the broker brings buyers and sellers of securities together, and facilitates trades. For this service there is a fee on each trade – a fee on both the buy and the sell, paid by the customer to the broker.
Looking back on it, Dad was explaining to me that I, the buyer, and the broker, had a conflict of interest. My interest was getting the cheapest price for the shares. The brokers interest was...
One of the most popular ways to save for retirement is in a Roth Individual Retirement Account. Roth IRAs was first made available in 1997, after they were championed by former Senator William V. Roth of Delaware.
Tax-wise, a Roth IRA is like a Traditional IRA in reverse. It may help to compare the two registrations.
In a Traditional IRA, as well as in a 401k, most people get tax deductions for contributing dollars up to certain limits every year. The account accumulates funds over time, perhaps generating some nice earnings, tax-deferred. When it’s time to retire, the full amount of the distribution is taxable at your marginal tax bracket at that time. Using simple math, if your tax bracket at retirement is 24% and you distribute $100 from your Traditional IRA you will get to keep $76. Remember, distributions from a Traditional IRA are fully taxable. Contributions are made before tax.
According to CNBC, there is more than $1.2 trillion in outstanding student loan debt, owed by 40 million borrowers, who have an average balance of $29,000. * Do you have student loan stress?
Large student loan balances can be a significant cause of stress. Stress over loans can lead to resignation. “I’ll have student debt forever” is a refrain I hear from some clients. Resignation leads to denial and even inaction. Are you in this progression? Does this sound like you or someone you know? Are you a number of years out college or graduate school, yet it doesn’t seem like your loan balance is coming down?
Your mindset about student loans is crucial. Most importantly, own it. The loans are yours. You chose to make a strategic investment in yourself by taking on student loans. Accept this fact, and make a plan of attack to repay the loans. The #...
Can I Time the Markets? You can certainly try. But remember the expression: one man's ceiling is another man's floor.
When the stock market becomes volatile, people often wonder, Is this a good time to go in? Or should I sell out? What they are doing is trying to time the markets – they are making educated (or emotional) guesses as to market peaks and valleys, and investing accordingly. I’d put it to you that market timing doesn’t work, at least not consistently over time. If you look at a line graph in the first quadrant, there is nothing to say that the next data point will be above the last point, at the last point, or below the last point. Trends are real and visible, but they change.
We certainly understand the impetus behind market timing. You as an investor don’t want to put your money in on what turned out to be a high day for the year, and conversely you don’t want to have...
We make no recommendations before completing our due diligence. Only after we have a clear picture of your risk tolerance, income needs, tax situation, time horizon, and cash flow position do we make any investment recommendation.
There’s no such thing as a perfect investment. Each investment product on the market was designed to accomplish a specific purpose and has its own risk and reward characteristics. Whether it is a managed account with mutual funds, ETFs, individual securities, bonds, annuities and insurance products, our job is to match you with the appropriate vehicle.
Yes of course. There are several mutual fund companies that screen their underlying investments by various social and/or religious criteria.
We can do a projection for you. For example, say you want to retire 10 years from now; you want to have an income of...
A flexible spending account (FSA) is an elective benefit offered by many employers. There are generally two types: the FSA for healthcare expenses, and the FSA for dependent care expenses. This is part two of a two-part series. Here I describe the dependent care flexible spending account. You’ll find my post on the healthcare FSA here.
Dependent care flexible spending account
The Dependent Care FSA is a great way to fund, on a pre-tax basis, childcare expense incurred so that the parent can go to work. You must claim the child as a dependent on your tax return. Also, the child must be under age 13. The maximum tax-free reimbursement under a dependent care FSA is $5000/year. If married, both spouses must work in order to benefit. There is an exception if the non-working spouse is a student or disabled. If one spouse earns less than $5000, the benefit is limited to the earnings of that spouse.
What are the eligible expenses?
There are many....