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Kiddie Tax - The Exceptions

4/9/2015

In our last blog post, we discussed what is kiddie tax.

Some children are not subject to the Kiddie Tax. A few of the reasons a child would not be subject to the Kiddie Tax are:

Children not required to file a return because they did not have enough income to report.
Children who earned more than half of their required support. This also means that they are not likely to be a dependent of someone else.
Anyone who files a married filing jointly tax return.

In our next blog post, we will discuss how does kiddie tax work.

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Kiddie Tax - What is Kiddie Tax

4/8/2015

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Q. What is kiddie tax? Do I have to pay for it?

A. Kiddie tax is a tax that is applied to your child's unearned income of more than $2,000.

Unearned income refers to investments, such as interest, dividends and capital gains. Income from wages or self-employment are not included.

The kiddie tax is meant to discourage parents from reducing their own taxes by shifting investments to their children, who generally have lower tax brackets. The Kiddie Tax once affected only children under age 14. That's how it got its name.

For 2014, your child is generally affected if they have investment income of more than $2,000 and falls into one of these categories:

Under age 18 at the end of 2014,
Age 18 at the end of 2014, with earned income (from working) that is less than or equal to half of their support for the year,
Full-time student age 19-23 at the end of 2014, with earned income (from working) that is less than or equal to half their support.

In our next blog post we will discuss a few exceptions that kiddie tax does not apply.

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Some Interesting Life Insurance Industry Stats

4/7/2015

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The following data are sourced from American Council of Life Insurers:

75 million American families count on life insurers to protect their financial futures
At the end of 2013, 144 million individual life policies were in force
Of new individual life policies issued in 2013, 64% were permanent life insurance policies
In 2013, life insurance beneficiaries received $64 billion in death benefits
American families have more than $20 trillion worth of life insurance protection through individual policies and group certificates
78% of survey respondents believe that it is important for the government to encourage people to protect their families with life insurance

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3 Simple Steps to Select Your Wireless Plan

4/6/2015

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Q. How to reshop my cell-phone plan easily?

A. Wireless plans are complicated, but below are simple 3 steps you can take to pick the best wireless plan for your situation:

Step 1. Find the Right Plan
You can visit Wirefly.com and enter your typical usages and number of lines in a month, it will list all of the suitable plans and prices for you to choose.

Step 2. Check Network Coverage
A good price without a good network coverage is still not good. You can visit Rootmetrics.com and check your location on a coverage map to see network performance based on Rootmetrics' testing.

Step 3. Look for Deals
All of the wireless carriers are fighting for your money by offering special promotional deals. You will have to visit your desired plan providers and see what kind of special deals they have at the time you are shopping.

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Differences Between Fiduciary Standard and Suitability Rule

4/5/2015

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Q. What are the differences between fiduciary standard and suitability rule and why they are important to ordinary investors?

A. These two terms are very important for investors.

Fiduciary Standard
Investment fiduciaries are legally bound to act in your best interest, even at the cost of their own, when giving advice or recommendations. Registered Investment Advisers (RIAs) are held to a fiduciary standard.

Suitability Rule
Security brokers adhere to a less-stringent suitability rule - the investments they recommend to you must be suitable for you, given your goals, age, risk tolerance, etc. However, such investments might not be, say, the lowest cost alternative you can choose.

When do the differences matter the most?
It typically happens when you leave your current employer. 401(k) plans always have a fiduciary (usually your employer). If you leave your employer and meet with a broker to discuss your options of dealing with your 401(k) assets, you might frequently be pushed to rollover your 401(k) accounts into IRAs, this might or might not be a good move for you, but one thing is certain - the brokers will reap higher fees.

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4 Client Relationships and Only 1 is Good for Both of You

4/4/2015

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1. Not good for you, not good for your client
These relationships are not good for you or your clients. If there’s no way to create a healthy, value-creating relationship with your prospect, then any deal will cost both of you time and energy. But that’s not where most of these relationships come from. Most start out at some higher level and over time decline into this category, often when both parties become complacent. What are you doing to prevent your relationships from slipping to this level?

2. Not good for you, but good for your client
This is where most weak salespeople live. They take deals in which they can’t command the price they need and so always deal with customers who are getting the better end of the deal. These are not peer relationships, these are subservient relationships. These relationships make you resentful, and in the end, you probably under-serve your clients, making them resentful in turn. How do you move these relationships to a better level?

3. Good for you, but not good for your client
These are not the relationships in which you do your best work. In these relationships, you do well and your clients don’t do well. That’s never good. When you create value, you’re entitled to capture some part of the value you create. When you create massive value, you can capture massive value. In these deals, you capture the majority of the value. Ultimately, this will destroy your relationships, your reputation and your revenue. What do you need to do to create the value that would entitle you to receive what you are now capturing?

4. Good for you, good for your client
This is the sweet spot you should be aiming for. These are the relationships you need in order to grow and sustain your business. This is how you win over clients for life — you create massive value and capture massive value. You bring growth initiatives to your clients, and they challenge you to grow with them. To create these relationships, call on prospects for whom you can create massive value and who seek this category of relationship. You have to develop the initiatives that deliver, and you have to accept the challenge to grow yourself.

Which category do most of your client relationships fall into? What can you do to move these relationships to a healthier place? How can you find more prospects with whom you can have a win-win relationship?

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The Art of Selling

4/3/2015

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Is selling just the transfer of goods or services in exchange for money?

Of course not, it’s much more than that.

Selling is an exchange of trust and value — a set of promises we intend to keep.

What we’re really trading in is promises — assurances upon which expectations are based, which means that our intention is a big part of what we sell.

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A Free Stock Screen Online Tool

4/2/2015

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Q. Which online tool I can use to screen stocks based on my developed strategies?

A. Try Finviz - you can set fundamental and technical indicators to prescreen stocks that meet your requirements.

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Why Leasing Is Less Expensive But You Probably Still Should Not Do

4/1/2015

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Q. Why leasing a car is less expensive than owning a car and should I lease a car?

A. The reason leasing a car is less expensive than owning a car is simple - you are only paying for the difference between the new car value and the car's estimated value after two or three years at the end of the lease.

However, leasing is not for everyone. Here are some of the disadvantages:

Higher insurance costs
If you use leasing to step up to a more expensive car, the insurance costs could be higher than you expect. Make sure check insurance quotes before making any decision.

No equity in the car
At the end of the lease, you have no equity in the car. Even you lease the car twice, each with 3-year term, at the end of 6 years, despite you spend less on least costs during these 6 years and have less maintenance costs, you will still end up being a winner if you buy the car outright.

Low mileage limit
A typical lease allows 12,000 miles a year. If you drive more than that, you could face expensive mileage penalties. And leasing companies levy additional penalties for wear and tear on the car too.

If you fit the mileage profile and tend to take good care of your car, leasing may appeal to you. And you will be avoiding any hassle involved in selling or trading in a used car.

If you do decide to lease, make sure your contract includes so-called gap insurance. If you should have an accident early in the lease, the insurance will cover the difference between repair or replacement of the car and the amount you already have paid on it.

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Forward>>

Kiddie Tax - The Exceptions

Kiddie Tax - What is Kiddie Tax

Some Interesting Life Insurance Industry Stats

3 Simple Steps to Select Your Wireless Plan

Differences Between Fiduciary Standard and Suitability Rule

4 Client Relationships and Only 1 is Good for Both of You

The Art of Selling

A Free Stock Screen Online Tool

Why Leasing Is Less Expensive But You Probably Still Should Not Do

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