- Contribute to your retirement accounts.
If you work for a company that matches your 401(k) contribution, try to contribute at least up to the percentage they match. Otherwise, you’re leaving money on the table. - Make your required minimum withdrawal from your IRA.
Do you have a traditional IRA? Starting at 70 ½, the IRS requires you to withdraw a certain amount each year, known as a required minimum distribution (RMD). - Use up your flexible spending account (FSA).
Find out the deadline for using this money if you have an FSA, since you will lose it if you don’t use it by the deadline. - Think through your holiday spending.
Now is the time to also think about paying down any debt or padding your emergency fund. - Check your credit reports.
If you haven’t checked your credit reports in the last 12 months, the end of the year is a great time to do so. - Consider year‑end charitable giving.
In addition to using your dollars to support a cause you are passionate about; many charitable contributions of money or property are also tax deductible. - Assess the last 12 months.
Reflect on how you did this year from a financial standpoint. Think about what went right and what would you like to adjust. - Plan for the next 12 months.
If your assessment of the past year calls for some changes, use that information to start planning for the new year.
Take these eight steps now:
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These 5 Internal Revenue Tax Code sections put the power of life insurance to work helping you reach your financial goals: Keep reading to see more detailed discussions of these 5 Internal Revenue Tax Codes and their applications in Life Insurance Products.
You need (or really want) to travel soon, and you need to book a flight. How can you find something like a deal or at least the lowest fare out there?
First, you can rely on the search engines to do the initial search. Google Flights has become a go-to, as it lets you search by destination, date, and alternate airports and easily alter search variables. (It includes flights from most, but not all, airlines.) After that, turn to a trio of similarly useful online tools, Skyscanner, JustFly, and Momondo. These websites focus on price first and are constantly updated. After you find a fare you like, click or tap over to that airline’s website. You may be surprised to discover that the fare is even lower than what these search engines report. If you are the type who likes to be on the lookout for a cheap fare, consider web portals like Airfarewatchdog and Scott’s Cheap Flights. Lastly, think about following an air carrier or two on social media – another avenue through which an airline can suddenly unveil a good deal. Q. What are the good ways to teach young kids lessons about money?
A. Teaching kids about money is one of the best educational foundations parents can give. And if you’re a money-savvy parent, you may have all the skills to put your children on the path to financial success. Here are 5 lessons smart parents could teach their kids about money -
Q. I was always reminded that funds' past performance is no guarantee of future performance. But if we can’t evaluate past performance, what are we supposed to look at to make reasonable and thoughtful investment decisions? A. Averages derived over many years do matter because future performance tends to progress or regress toward the long-term average. It’s helpful to know the past to get a sense of the present. For example, as shown in the chart “Performance of funds,” mutual fund and ETF average performance by category over more recent time frames has, in some cases, diverged considerably from the 30-year average performance. The general notion here is that the longer the time period is, the more reliable and useful the performance figure. The same could be said for the chart "Performance of Indexes" below. If you take a macro look at the tables, it’s clear the concentration of yellow highlighting is in the October, three-year, five-year and 10-year figures. Secondly, growth-oriented funds and indexes are more “in the yellow” than blend and value-oriented funds and indexes. Growth-based funds have enjoyed more recent success than blend- and value-oriented funds, hence are more likely to suffer more as they revert toward their longer-term average performance.
There is another metric in both tables that is somewhat unique and hopefully helpful. In the far-right column there is a standard deviation calculation. This figure represents the variation among the returns for all seven time periods. While this represents an unusual approach to the calculation of standard deviation, it is actually quite revealing. What we see is a consistent pattern in which the standard deviation for growth-oriented funds and growth-oriented indexes is higher than blend (where blend is a mix of growth and value) and value-oriented funds and indexes. This clearly suggests that growth-oriented funds and indexes demonstrate wider swings in performance based on the time period being looked at. Mutual funds and ETFs that are classified as “blend” are the second-most volatile in terms of performance variation over different time periods, while value-oriented funds and indexes have the least amount of time-period performance variation. Fareness
The easiest to use app and it does everything for you. Google Flights The fastest and easiest to search a lot of options. Hipmunk One of the cleanest airfare search tools. Hopper One of the most sophisticated airfare search tools. Momondo The best flight analytics - a graph that shows price trends. Skiplagged If time is not an issue, this airfare search tool could find you a bargain. Skyscanner One of the largest and simple interface. Do you fit the profile below -:
If yes, please keep reading the document and a case study from Lincoln Financial Group below - Q. What's a good long term care product that if I don's use it, my premiums are not wasted? A. Lincoln National has a hybrid funding solution may be the best way to protect you and your loved ones from long-term care expenses. Here’s how: 1. If you do need care, you have a tax-efficient, dedicated funding source, designed to meet your needs.1 2. However, should you not need care, you’re able to give your family a legacy through a death benefit.2 3. And, if you change your mind, you’re able to get money back.3 1 LTC reimbursements are generally income tax-free under IRC Section 104(a)(3). Funding is through reimbursements, subject to the monthly/annual maximum amount. 2 Beneficiaries may receive an income tax-free death benefit under IRC Section 101(a)(1). 3 The return of premium is provided through the Value Protection Endorsement available at issue on all policies. The amount returned will be reduced by any loans, withdrawals and benefits paid. The Value Protection Endorsement contains complete terms and conditions. For archived newsletters, please visit here.
Q. Why every retiree should consider a Single Premium Immediate Annuity product in his or her retirement portfolio?
A. SPIA should be considered by every retiree for two reasons: 1. Eliminate Longevity Risk A SPIA is an excellent way to reduce the fear of running out of money. It can allow an individual to spend the growth in their portfolio on travel, new cars, hobbies and other activities of daily living that occur in retirement. Retirement has become a new Life Stage and people want to enjoy retirement but it takes income to do so and a SPIA provides that income and they will receive it as long as they are alive. 2. Avoid Unnecessary Losses in a Down Market By covering fixed and necessary living expenses with a SPIA, an individual has reduced the risk of loss in retirement portfolio. They no longer need to sell off assets in a downmarket in order to fund everyday living expenses. Their social security and Immediate annuity income cover all those necessary expenses. JoinHoney.com
This browser extension automates your savings, it's best for online coupons and private alerts. When you check out at Amazon or any other 30,000 websites, you just click on Apply Coupons in a pop-up box, and HOney will input coupon codes for you. It can also alert you when a product's price drops and provide price histories on many items. Fakespot.com This browser extension is essential if you shop at amazon.com, walmart or any other e-retailers that offer products sold by third parties. It checks if a review is fake or real. It's best for you to decide what and where to buy! PriceBlink.com This browser extension checks prices at 11,000 stores. When you shop at Amazon.com and land at a product page, a yellow bar will pop up, click on Compare Prices and you will get a list of prices for that item at other stores. Rakuten.com Use this browser extension on your computer will earn you cash back when you making qualifying online purchases at more than 3,500 stores such as amazon.com. It sends out a check in the mail quarterly once you reach $5 in rewards. Federal tax law places limits on the dollar amount of contributions to retirement plans and the amount of benefits under a pension plan. IRC Section 415 requires the limits to be adjusted annually for cost-of-living increases.
Starting Jan. 1, 2020, you can invest more thanks to an increase in the dollar limitations for some retirement-related items for the 2020 tax year. The contribution limit for employees who participate in 401(k), 403(b) and most 457 plans, will increase from $19,000 to $19,500. Other changes please see table below. The Power Series of Index Annuities® with the Lifetime Income Plus FlexS guaranteed living benefit (GLB) rider provide with the flexibility to take Required Minimum Distributions (RMDs) without eliminating rollups or locking in withdrawal rate for life. See a hypothetical example below - income is guaranteed to grow for the first 10 contract years, even after RMDs begin. Plus, you can wait until you’re in a higher withdrawal age band to activate your rider and lock in more income for life. Credit scores could have big impact on many things, from better terms on credit cards and lower mortgage rates, to lower premiums on auto and homeowners insurance, and sometimes even the ability to get approved to lease an apartment (or to waive the upfront deposits).
However, here are 7 myths regarding what may (but actually doesn’t) help or hurt the credit scores - 1. Checking credit scores can hurt the credit score (a “hard inquiry” where a financial firm is evaluating a potential loan to you can have an impact, but a “soft inquiry” like an employer conducting a background check does not, nor does a soft inquiry of checking your own credit score); 2. Paying bills on time is all you need to worry about (it’s not, as “credit utilization” also matters, because paying on time but always being maxed out is a negative compared to ‘just’ using 30% of your available credit each month, which can be remedied by spending less or simply asking for a credit limit increase); 3. Carrying a balance helps boost the credit score (it doesn’t, it just racks up interest charges!); 4. Closing an old card with a high interest rate will help (it doesn’t, and closing a long-standing card can actually reduce the score by reducing the average age of your credit accounts); 5. Opening a new retail card at a 0% rate is good for your score (it’s not, it’s a hard inquiry that’s more likely to reduce the score); 6. Shopping for a mortgage/auto/student loan hurts the credit score (hard inquiries matter, but if multiple hard inquiries come together, they’re bundled together as a single query, and recognized as a single transaction that reflects the borrower is likely just shopping around); 7. Assuming credit reports are accurate in the first place (the FTC found in 2012 that 21% of consumers had errors, with 5% of the cases so serious it impaired their credit… which means it really is important to monitor your credit score to ensure credit events are being reported properly!). Q. What are the steps I should take in order to create a diversified and secure retirement income plan?
A. Here are 5 steps to consider taking to help create a diversified income plan:
Q. What are the major costs and savings when downsizing?
A. The table below shows the major costs and savings in downsizing. 1. Early withdrawal penalties
If you are age 55 or older with a 401(k) plan, you may leave your job and take money out of the 401(k) plan without the 10% penalty. You will still pay tax, but no 10% penalty. However, if you take a 401(k) plan and roll it over to an IRA, you will lose that age 55 exception; you’ll have to wait until age 59½ before you can avoid the 10% penalty unless you meet one of the other exceptions. 2. Taking your first RMD If you have a traditional IRA, you have to remember that you will be subject to those required minimum distributions (RMDs). These begin during the calendar year in which you become 70½ years old. RMDs do not apply to Roth IRAs. Q. If I work in state A but live in state B, which state should I pay income tax?
A. States generally tax the income of nonresidents who generate income in that state. Income subject to tax can include:
The map below shows income tax rates by different states in U.S. Every life stage brings different financial priorities and concerns — Securian Financial’s educational document below discusses priorities and solutions for consumers' Long Term Care and Critical Illness concerns at different life stages. Its target is for insurance professionals, but consumers will find it helpful too. The average annual cost of a full-coverage auto insurance policy in the United States is $2,390, according to financial data analytics firm ValuePenguin. Based on analysis of insurance rate data from Quadrant Information Services, ValuePenguin has published a list of the 12 cheapest car insurance companies across the country.
Erie has come out on top, with the lowest average annual rate of $1,521, which is approximately 46% cheaper than the national average across all 50 states and the District of Columbia. In the 12 states and Washington D.C. where Erie does business, the insurer is often the cheapest insurer for drivers. ValuePenguin found that drivers in Pennsylvania who choose Erie could save up to 32% compared to the state average. In second spot is State Farm, with an average annual rate of $1,737. State Farm is the largest auto insurance company in the country, offering rates that beat the average in 46 states and D.C. State Farm’s mean is just lower than the average annual rate of $1,781 provided by Farm Bureau Mutual (IA Group), a regional insurer that offers coverage in eight Midwestern and Western states. ValuePenguin’s data is based on online insurance quotes obtained via Quadrant Information Services for a sample driver. For the purpose of the exercise, the driver was a single 30-year-old man, who drove a 2015 Honda Civic EX and had a clean driving record. The only variable that changed was the ZIP code where he lived in the US. The coverage quoted included: bodily liability (limit of $50,000 per person/$100,000 per accident); property damage (limit of $25,000 per accident); uninsured/underinsured motorist bodily injury (limit of $50,000 per person/$100,000 per accident); comprehensive and collision ($500 deductible); and personal injury protection (the minimum amount when required by the state). Based on ValuePenguin’s analysis, the 12 major US auto insurance companies with the cheapest average annual rates are: 1. Erie Average Annual Rate: $1,521 2. State Farm Average Annual Rate: $1,737 3. Farm Bureau Mutual (IA Group) Average Annual Rate: $1,781 4. American Family Average Annual Rate: $2,041 5. Auto-Owners Insurance Average Annual Rate: $2,112 6. GEICO Average Annual Rate: $2,158 7. Nationwide Average Annual Rate: $2,293 8. Progressive Average Annual Rate: $2,393 9. Metropolitan Average Annual Rate: $2,447 10. Travelers Average Annual Rate: $3,017 11. Allstate Average Annual Rate: $3,545 12. Farmers Average Annual Rate: $4,280 NA. USAA *only provides insurance coverage to current and former military members and their families. Average Annual Rate: $1,307 While price comparison can be a useful benchmark in personal auto insurance, it’s not the be-all and end-all. The depth and breadth of coverages alongside claims resolution and other value-added services are equally, if not more important than price. This is where the advocacy of the insurance agent really comes into play. In addition to that, insurance companies are facing many challenges in auto lines right now. Issues like distracted driving, which is at an all-time high, and inflated vehicle repair costs due to increased in-vehicle technology are driving loss costs up, meaning insurers are having to pursue rate in order to break even on their auto insurance books. As a result, many drivers are seeing increases to their annual rate, and even the ‘cheapest’ options above seem expensive to many households. Grandparents can pass retirement income to grandkids. The document below shows how to make it happen. We discussed the fourth question here, now the last question to answer.
5. How does your home factor into your retirement? Your home is likely one of your most valuables assets. If either downsizing or relocating is in your plans, you may want to start plotting the move now. If moving isn't in the cards, you may still want to think through whether it makes sense to pay down your mortgage faster—thereby saving on interest payments and improving cash flow in retirement. Alternatively, consider how to use some of your home equity to help finance your retirement. If tapping home equity is only a temporary solution to bridge the gap until you start to draw down your retirement assets or start receiving guaranteed income payments, consider applying for a home equity line of credit while you're still employed and more likely to qualify for the best rates. If home equity factors into your long-term planning, you could also consider a reverse mortgage. But proceed with care and be sure you understand all the associated costs and requirements. Before considering any of these ideas, make sure you consult a tax professional or attorney. We discussed the third question here, now the fourth question.
4. Where will your retirement income come from? At the same time you think about shoring up your retirement nest egg, you need to begin thinking about how you'll convert some of these savings into retirement income. For many people, it's helpful to start by grouping potential sources of income into 2 basic buckets: guaranteed income from sources such as Social Security, pensions, and annuities, and variable income from a job, retirement savings, and other sources such as rental real estate. Next, estimate your retirement expenses and then map out ways to meet essential expenses with guaranteed income sources, and discretionary expenses with nonguaranteed income. If you plan to work a bit during retirement, that may provide a conservative boost to your retirement income. But be cautious here. Survey data shows that many people are not able to work as long as they wanted. Finally, before you rush out to file for your Social Security benefits at age 62, consider the big picture: Generally, the longer you wait, the higher the potential lifetime benefits. After your review your current investment mix, you may also want to consider shifting a portion of your investment portfolio into income-producing assets, such as bonds or dividend-paying stocks. A guaranteed income annuity is another option to consider if you're interested in converting your assets to income. Generally, the older you are when you buy an annuity, the higher the monthly payout, but there may be advantages to purchasing an annuity before you reach retirement age. But these potential moves should still be done within the context of maintaining an appropriate overall asset mix across stocks, bonds, and cash. Remember, your retirement income will likely need to last for 30 years or more, which typically requires some exposure to stocks. Read the last question here. You can read the second question here, now the third question to answer.
3. Are you invested properly? As you round the bend toward retirement, it’s not a good idea to take on any more investment risk than necessary for your time frame, financial circumstances, and risk tolerance. But remember that this does not mean the answer is always to become more conservative. The consequences of being too conservative can be just as worrisome when you account for inflation and the possibility that you could outlive your savings. That is why it is important to think about an appropriate asset allocation. Although you can't control market behavior, you can help manage its long-term effect on your portfolio through investment choices and by modifying portfolios so they have an age-appropriate mix. An ideal investment mix will depend on a number of factors, including your age, time horizon, financial situation, and risk tolerance. Retirement is often the time to take some risks off the table, but some people are tempted to become too conservative. Don't forget that your goal is for your retirement savings to last for a 30-plus-year retirement time horizon. This usually means some longer-term growth potential is needed in the portfolio. Keep reading the fourth question here. |
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