My Second Trip to Europe

By Glenn J. Downing, MBA, CFP®

This blog post builds upon a previous one:  No, Darling, because we can’t afford that.  I’m sharing some thoughts about teaching children to be financially responsible. 

What Was the First Trip?

My second trip?  What was the first?  My first trip to Europe I was 13, and my grandparents took me on vacation with them.  My maternal grandmother had come over from Italy at about age 5, and was raised in Connecticut, where I was born.  Her husband, my maternal grandfather, one of 16 children, was born in Connecticut, but some of the siblings were, I believe, born in Italy.  Grandpa was a successful business owner in New Haven, and they went to Europe on vacation most years.  In turn, they took each of their four grandchildren with them once – a gift I’d like to return some day.

The Deal with Dad

The second trip is the one I want to write about.  My Uncle Joe, my Dad’s...

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No, Darling, Because We Can't Afford It

By Glenn J. Downing, MBA, CFP®

A friend recently suggest that I write a piece about children and money.  At first I thought myself unqualified, as I have no formal education in this area.  But then I got to thinking that, as a father and now grandfather, and since I’ve been graduated from life’s School of Hard Knocks, that I might have something useful to contribute.  Hence this effort.  This is actually Part I of a two-part series.  Part II is all about my Second Trip to Europe.  

I love children.  Always have.  I don’t like unrestrained screaming, but I do enjoy hearing children happily play.  My wife and I have two married daughters and two grandchildren, all of whom we love dearly.  But children, as they are delivered to us, are loud, messy, demanding, have appalling table manners, and think the world revolves around them.  Furthermore, they don't come with manuals.  Yet it is our job as...

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Health Savings Accounts

By Glenn J. Downing, MBA, CFP®

What is the best tax bargain out there? 

Is it the 529 college savings plan?  Let’s see.  That is funding with after tax dollars, but the funds grow without taxation and come out without taxation when used for qualified higher education expenses.  That’s a double tax advantage.

How about the Roth IRA?  Same thing as the 529.  A double tax advantage. 

How about a Traditional IRA?  Here I deduct on the way in and have growth without taxation.  The tax bill comes when I distribute.  So this is another double tax advantage

Is there a triple tax advantage out there?

Yes!  There is one to my knowledge, and that is the Health Savings Account

The HSA is used in conjunction with a high deductible health insurance plan (HDHP).  This is one which, per IRS regulations, has a deductible of at least $1400 for an individual or twice that for family coverage. ...

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SIMPLE IRA

By Glenn J. Downing, MBA, CFP®

The SIMPLE IRA is the Savings Incentive Match Plan for Employees. The SIMPLE allows for both employer contributions and employee deferrals. The plan is deal for employers who want to contribute something – but not a lot – to employee retirement accounts.

The is the second in a two-part series about retirement plans for the small business.  The first was about the SEP IRA.  

Who Is Covered Under the SIMPLE?

The SIMPLE is for an employer with fewer than 100 employees who earned less than $5000 in the previous year. The employer cannot have any other retirement plan – only the SIMPLE. Any employee who earned $5000 in any of the previous two years and expects to do so in the current year is eligible to participate. The plan must be established before October 1st for the current year. After Oct. 1st it will become effective for the following year.

Employer Contributions

A big part of retirement plan design has to do with...

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7 Financial Life Hacks While Living in Miami

by Jonathan G. Cameron, CFP®

1. Create a budget.

If this sounds too obvious, I’ll say it again for reinforcement – are you maintaining a budget? Seriously. Miami is one of the flashiest cities in the world. If you don’t have a budget I’ll put it another way — Estas loco? It has been proven that our propensity to spend money in Miami is directly proportional to our physical proximity to Brickell/Downtown Miami and South Beach. A budget is by far the best way to keep track of your money. If you have a budget, you’re already way ahead.

2. Want to build up your credit score fast?

Pay your bills on time. In other words, “Do what you say you’re going to do, Miami.” Your payment history comprises 35% of your credit score. By contrast, your length of credit history accounts for only 15% of your overall score.

3. Time is your biggest asset.

Spend extra time with the people you care for most in life. This is easier said than done...

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The SEP IRA

By Glenn J. Downing, MBA, CFP®

With this blog post I’m beginning a two-part series about retirement savings plans available to the small business owner. Earlier Jonathan wrote about the Traditional IRA and the Roth IRA. In this piece I’m going to explain the Simplified Employee Pension, or SEP IRA. It is best used in a small shop, with few (or no) employees. It can be established by an individual proprietor, filing a Schedule C, or by a corporation, LLC, or partnership.

The SEP – Simplified Employee Pension

The SEP is designed for the business owner with few employees. Money goes into the SEP from employer contributions only. All contributions are tax-deductible to the employer. There is no opportunity for employee deferrals. A SEP IRA account is opened for each participant, and all funds contributed are immediately vested. (There is an older version, called a SARSEP, or salary reduction SEP. Although many are still out there, they cannot be opened after...

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165 Eaton Place

By Glenn J. Downing, MBA, CFP®

Last year (2019) I watched the entire Upstairs Downstairs series on Britbox. Easily sixty episodes in all. My viewing interests are usually limited to either WWII or British crime stories, so this was a bit of a departure for me, and one I thoroughly enjoyed. As the name suggests, it is sort of a Downtown Abbey Lite. The time spanned goes from before WWI to the New York Stock exchange crash. It is the story of all the residents of 165 Eaton Place in London – the home of a member of Parliament who married a titled lady (the upstairs folks) and their household staff (the downstairs folks).

Richard Bellamy, MP, had two children – a married daughter in New York, and a son at home – James Bellamy. James was up at Cambridge, though no mention of a degree. He worked at a job he hated because it was, well, work, and then joined his regiment as an officer during the Great War. This is a fellow whose newspapers and shoelaces were ironed for...

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Hurricane Financial Preparedness: Top 6 Priorities Before A Storm Hits

by Jonathan G. Cameron, CFP®

When I originally wrote this, the Carolinas were experiencing the worst of Hurricane Florence.  As a native Floridian I've ridden out half a dozen hurricanes myself . The aftermath of a hurricane is not only about the damage to life and property, but for many it can take a serious personal financial toll. As you stock up on canned food, batteries, and bottled water, don’t neglect to address these top 6 financial priorities before a storm makes landfall.

1. Review Your Homeowners Insurance Policy for Windstorm Coverage

Odds are your home is your most valuable asset. Why roll the dice on this? Not having homeowners insurance coverage is a mistake. Having a homeowners policy with little hurricane windstorm coverage could become a catastrophe. Typically, your policy will have a windstorm deductible for hurricane damage claims in addition to your All Other Perils deductible for everything else. The deductible for hurricane damage can...

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Financial Windfalls: Money Changes, Life Changes

by Jonathan G. Cameron, CFP®

A few months ago I heard Susan Bradley from the Sudden Money® Institute say something quite profound regarding our relationship with money and financial windfalls:

When life changes, money changes.
When money changes, life changes.

The order in which change happens makes a big difference. The latter statement, referring specifically to financial windfalls, turns out to be much harder to handle for most people than the former statement. Let me explain.

Life Changes

Life changes are a constant: marriage, babies, a new home, family milestones, divorce, promotions, demotions, getting fired, moving to a new city, kids going to college, changes in health status (ourselves or in a loved one), growing old, and death.  As with any change, anticipated or otherwise, we regroup; we make budget adjustments; and move forward.  Whatever the life change, you hopefully take wise counsel and update your financial plan accordingly.

Money Changes

By ...

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Everybody Needs Estate Planning – That Means You!

 

By Glenn J. Downing, MBA, CFP®

Usually when we think of estate planning we have in mind the orderly transition of assets at death. Death is something that you have a 100% chance of experiencing – we just don’t know when. Tomorrow isn’t promised to us – and neither is this afternoon, for that matter. Consequently it is prudent to plan for this eventuality.

What Documents Do You Need?

A valid will

A basic will is the foundational document of estate planning. You need that once you own real property or begin to accumulate assets. Typically, at the earlier stages of life, most of what you have is going to pass by operation of a beneficiary arrangement – by contract, in other words. Think life insurance or IRA and 401(K) beneficiaries. What won’t pass by operation of contract? everything else that you own. This would be real property, or your car, for example – assets that cannot have a beneficiary attached to them.

Guardianship for your...
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