Certified Financial Planner Boise ID

Retirement Trap: RV’s and Trailers

Posted by on Aug 29, 2017 in Certified Financial Planner Boise ID, Certified Senior Advisor Boise ID, Financial Advisor Boise ID, Financial Planner Boise ID, Financial Planners Boise ID, Financial Planning Consultant Boise ID, Financial Services Advisors Boise ID | Comments Off on Retirement Trap: RV’s and Trailers

Lower gas prices and an influx of retirees has led to more purchases of RV’s and Trailers. This can be a more economical way to travel the country. Before you spend big $$ on this purchase, try renting a unit. See if you have the RV personality, to live in smaller quarters, limited privacy, changing neighbors and RV parks and driving long distances pulling your mobile home. Many couples have enjoyed seeing the country pulling their lodging with them. Many set goals to see all the national parks and surrounding areas, or traveling to see all 50 states. Yet renting before buying helps you determine if the RV life is for you. Resale of trailers is more difficult than selling your house. I have yet to see one at a profit. I have only seen large losses.   Photo credit: <a href=”https://www.flickr.com/photos/49012484@N00/9700662977/”>nocibomber</a> via <a href=”http://foter.com/re/897e90″>Foter.com</a> / <a href=”http://creativecommons.org/licenses/by-nc/2.0/”>CC BY-NC</a> Photo credit: nocibomber via Foter.com / CC...

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Retirement Trap: Starting a Business

Posted by on Aug 8, 2017 in Certified Financial Planner Boise ID, Financial Advisor Boise ID, Financial Planner Boise ID, Financial Planners Boise ID | Comments Off on Retirement Trap: Starting a Business

Work often gives you a sense of purpose. We need meaningful engagement with our community. Studies have shown people are happier in retirement if they are working 300 to 400 hours a year either in a paid position or volunteering. If you have left the workforce, you may find your gray hair restricting your re-entrance into the workplace. Some decide to start a business where you are the boss and can have flexible hours. Business expenses can eat into your retirement nest egg. Consulting or service work may be better options because their cash demand is limited. You want to avoid capital intensive businesses. Real Estate is often looked at with hopes of “flipping” a hours or having a rental. These endeavors can require large cash outlays. Some real estate markets have many investors competing for properties. Not everyone is cut out to be a landlord. I have seen real estate investments be disastrous for some and profitable for others. Be cautious; be sure you can afford the loss of any capital outlay in your new business venture. Consider phasing out of working full time into retirement. Your industry may be seasonal, or you can carry less responsibility and work fewer hours. Employers are starting to recognize the business knowledge and skills older workers have. Companies may work with employees to slowly transition into...

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Retirement Traps to Avoid – The Bank of Mom & Dad

Posted by on Jul 11, 2017 in Certified Financial Planner Boise ID, Certified Senior Advisor Boise ID, Financial Advisor Boise ID, Financial Planner Boise ID, Financial Planners Boise ID, Financial Planning Consultant Boise ID, Financial Services Advisors Boise ID | Comments Off on Retirement Traps to Avoid – The Bank of Mom & Dad

Be careful of helping your kids, you may jeopardize your own retirement security. A 2015 Pew Research Center survey found that 61% of Americans with adult children helped their kids financially in the past 12 months. Be careful that helping a child through a rough patch doesn’t become an annuity. The best gift you can give an adult child is the financial skills to be independent. Check out Dave Ramsey materials and his Financial Peace University. Or the book “How to be a Financial Grown Up” by Bobbi Rebell. The adult child needs to learn financial responsibility while you are alive. When you die, the safety net is gone. They may receive an inheritance, but if they have a leaky bucket, it won’t last. Studies have shown inheritances, regardless of the size, being gone in less than 3 years. You need to set boundaries with your children. Determine how long you will help and under what circumstances. Many times, after the loss of the patriarch, mom is left to contend with the children. Mom, can find an ally in the accountant or financial advisor. These professionals can affirm the boundaries and be the “bad guy” for mom. Another gift you can give your children – never need their financial help. Safeguard your retirement assets so you won’t need to depend on...

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Is Your Homeowners’ Insurance Adequate?

Posted by on Nov 17, 2016 in Certified Financial Planner Boise ID | Comments Off on Is Your Homeowners’ Insurance Adequate?

When was the last time you reviewed your homeowners’ insurance policy? If you are like many, that is part of your house payment each month – you do not really observe the rising cost as you do not pay the premium directly. The critical factor is to be sure you have adequate coverage. Marshall & Swift, a Los Angeles company, tracks the rebuilding costs for houses. Their statistics show that 61% of homeowners are underinsured. The average shortfall is 18%. You are not replacing at the Fair Market Value of your home; but what it would cost to build it at current labor and material costs. This can be higher than market value. The policy’s replacement value should increase annually. You also want to consider an extra provision to rebuild at the current code requirements. This is not standard within most homeowners’ policies. But consider a home built in the 1950’s will have significantly different building code requirements today. Or our home build in a county with few code requirements 20 years ago. With the building expansion over the years, came an increase in code requirements. You can evaluate the cost to replace your home at www.Accucoverage.com. Compare their report to your current coverage. We were a little surprised at our replacement cost. It was lower than we expected; yet the value does not include the cost of the land. The standard policy replacement cost covers 80% of the value. If your home is free of debt, you could have a loan again to rebuild. You may want to consider stepping up your homeowners’ coverage to 100% of the replacement value. Coverage of personal property is usually a percentage – 75% of replacement value. You can add an additional rider to cover “extras” such as electronics, jewelry and art. These riders can require that you have an updated appraisal on your jewelry and art. You may also consider creating an inventory of your personal belongings. If you have expensive purchases, keeping a receipt of your purchase helps document your “loss”. Having pictures to support your inventory list helps document your possessions and value as well. Homeowners and renters’ insurance is a means to lessen your loss if a disaster or theft occurs. However, there are items that reduce your risk exposure, such as: Smoke detectors, burglar alarms and deadbolt locks; Sprinkler system with alarms that alert first responders; Fire resistant roofing materials such as asphalt, rubber, cement and metal Noncombustible siding Fire extinguisher in the kitchen, as cooking equipment is the leading cause of home fires; Replace rubber hoses on the washing machine with steel-braided reinforced hoses, in order to prevent water damage on extended leaves from the home The website www.disastersafety.org gives tips and suggestions for minimizing damages from freezing, lightening, hurricanes, wildfires and earthquakes. The next posting will discuss part of the claims process....

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Wedding Gift Etiquette

Posted by on Jun 23, 2016 in Certified Financial Planner Boise ID, Certified Senior Advisor Boise ID, Financial Advisor Boise ID, Financial Planner Boise ID, Financial Planners Boise ID, Financial Planning Consultant Boise ID, Financial Services Advisors Boise ID, Peggy's Pearls | Comments Off on Wedding Gift Etiquette

It’s June and the wedding invitations are arriving, and the question becomes how much do you spend on a wedding gift?  The answer is:  It depends…           At no time do you spend more than your budget allows. You are encouraged to buy items off the registry.  You can plug either the bride or grooms name into RegistryFinder.com and discover where the couple has registered.  Start early to give yourself more options. Can you give cash?  Cash is the ultimate wedding gift, both for giver and recipient.  Cash doesn’t have to be bought at a certain store, is never the wrong color, and is easy to wrap by enclosing it in a thoughtful wedding card.  For the couple, cash does not need to be returned with a gift receipt, will match any household décor, and can be used for many purchases and expenses no matter what the amount, cash is useful and practical gift to help a couple start their life together. Whether you are buying a gift from the couple’s registry or giving cash, the guidelines for the amount are similar. Relationship – Close friends and family members would receive more than a co-worker. Travel Distance – If attending a wedding requires a plane ride and a hotel stay, you can buy something less expensive off the registry. Wedding Party Status – In general, the wedding party gives more, but if there were above and beyond expenses – like an extremely expensive bridesmaid dress or a bachelorette getaway in Mexico – you can give less. Other Gifts – If you are participating in other wedding activities, you can allocate your budget over these events.  The general rule is 20% on an engagement party or bachelorette party (depending on what part of the country you live), 20% on the bridal shower and 60% on the wedding gift. So how much is the right amount? The following is a guide: Wedding Gift Young person with limited budget = $50 Co-worker or acquaintance = $50 – $75 Friend or relative = $75 – $150 Close friend or relative = $100 – $200 (more in urban areas) In 2014, RegistryFinder.com reflected the average amount spent on a wedding gift was $120.  This is comparable to the average gift of $125 that Tendr.com registered. You can send your gift ahead, bring it to the wedding or deliver it up to 1 year later.  However, try to deliver within a two month period from the wedding. Again the guiding rule is “what does your budget allow.”  It isn’t about what they gave you in the past.  Personal budgets and financial situations change over time.  What may be an appropriate amount for a cash gift at one time may not be suitable for another event. Securities and advisory services through KMS Financial Services, Inc.  ...

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Do’s and Don’ts of College Planning – Tax Credits and Other Options

Posted by on May 26, 2016 in Certified Financial Planner Boise ID, Certified Senior Advisor Boise ID, Financial Advisor Boise ID, Financial Planner Boise ID, Financial Planners Boise ID, Financial Planning Consultant Boise ID | Comments Off on Do’s and Don’ts of College Planning – Tax Credits and Other Options

College funding is often like a chess game. You have to move pieces around carefully.  Tax laws are chess moves that can be played in the years the dependent is a student. The American Opportunity Credit gives you a tax credit for college expenses.  The first $2,000 of college expense is credited to your taxes – 40% is refundable, 60%reduces your taxes but is not refundable.  25% of the next $2,000 is eligible for credit.  The total credit is $2,500 in one year.  This credit can be used on first 4 years of undergraduate courses. Lifetime Learning Credit may also be used to offset college expenses.  This credit is non-refundable, but does reduce your tax bill.  The credit is 20% of college expenses up to $10,000 or maximum of $2,000.  This credit can be applied to both undergraduate and graduate work. Both credits are applied to qualified college expenses defined as tuition and fees, books, supplies, and equipment.  Room and board is not qualified expenses.  These tax credits do have income limitations.  But they can be used for taxpayer, spouse or dependents. Another savings option available to some parents comes from their employer’s stock purchase program.  Frequently, these programs allow employees to buy at a 10% – 15% discounted price.  And you can payroll deduct giving you disciplined savings.   This is another way to accumulate assets, leave it as an asset in your financial aid calculation with only 10% counting towards family contribution.  It is also in your name, so if it isn’t needed for college, you can use it as you please.  Several clients have had this option work well for them.  One client set aside stock from a previous employer for his children.  Both children received full ride scholarships.  The clients now own a cabin.  FLEXIBILITY!!! Another option you can use similar to the Roth IRA is a traditional IRA.  While this will come out as taxable income to the parent, it can be withdrawn free of the 10% early distribution penalty.  A word of caution:  The 1099R will be issued with reason listed as unknown.  Higher education expenses are one of the penalty exemption reasons.   Be sure you, or your tax preparer, are aware of this and complete the early distribution form correctly.    Again, be careful to not jeopardize your own retirement in helping your child. After all these many suggestions of HOW to save – WHAT investments do you use?  To receive tax deductions on your state income tax return, you may have to use the state program.  Regardless of which fund family you use, the investing philosophy is the same.  It is similar to retirement planning.  The younger the child is, the more aggressive you can be in your investing.  The closer to college the child is the more principal preservation becomes your focus.  In the 2008 melt down, I called my clients with children nearing college age to tell them to take a couple years tuition to cash.  They did not have recovery time before tuition would be due.  You want the funds to be there when the child is ready to start college.  And you want to sleep...

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