Category Archives for "Featured"
A few of our most popular posts
A few of our most popular posts
You’ve heard the expression your whole life, but what does it mean when it applies to your finances? Well to begin with, it’s not good.
Here’s the definition from Dictionary.com:1
to fall or slide down; to decline; to fall in value
His golf game is going south.
slang; goes south, going south, went south, gone south
The recent stock market downward corrections in 2018 have millions of active and passive investors nervous… again.
Many experts agree that the nine-year bull market is feeling the giant paws of the bear market clawing into their financial breadbasket.
I concur and believe this is only the beginning. Here are a few headlines to consider taken directly from Google on Saturday March 24, 2018.2
My personal favorite is the last one stating “Losses are part of the game when investing in the stock market”. Maybe it’s just me, but I've always thought keeping my money is always better than losing it.
1 day ago - The benchmark index lost 6% over the week and is down 3.2% year to date. The Nasdaq Composite Index COMP, -2.43% declined 174.01 points, or 2.4%, to 6,992.67 and posted a 6.5% loss over the week. Weekly losses for all three benchmarks were the steepest since January 2016, when markets were ...
2 days ago - The major averages posted their biggest weekly loss since January 2016. The Dow and S&P 500 dropped 5.7 percent and 5.9 percent this week, respectively, while the Nasdaq pulled back 6.5 percent. "The market has been priced for perfection ... and that leaves the market vulnerable to surprises. In this ...
2 days ago - The major averages posted their biggest weekly loss since January 2016. The Dow and S&P 500 dropped 5.7 percent and 5.9 percent this week, respectively, while the Nasdaq pulled back 6.5 percent. "The market has been priced for perfection ... and that leaves the market vulnerable to surprises. In this ...
Feb 5, 2018 - The rule book is now changing, a shift that is sending tremors through the financial markets. The Standard & Poor's 500-stock index fell by more than 4 percent on Monday, deepening its losses from the previous week and erasing its gains for the year. The Dow Jones industrial average sank by 4.6 percent.
Feb 28, 2018 - Some of Wednesday's drop was due to a slide in the price of oil, which sent energy stocks to the market's sharpest losses. The S&P 500 ... He told Congress that he's more optimistic about the economy, which led some investors to anticipate four rate increases for 2018, up from three last year. Among the ...
This Year's Stock Market Losses Are Normal. Posted March 20, 2018 by Ben Carlson. The recent market correction was unusual in how swift it occurred but the magnitude of the losses shouldn't be unexpected for investors. Losses are part of the game when investing in the stock market. This piece I wrote for Bloomberg in ...
Here’s a picture I took on my iPhone, March 24, 2018. This graph clearly illustrates the current market conditions of the last 3 months.
So how does one stay north when the market goes south?
One solution I can share.
The clients that I have helped with this dilemma have not been concerned from this down turn because they made decisions and acted to protect themselves from market losses. How? Because they re-allocated only what was needed to cover the income gap for projected essential expenses (after focused discussions and strategy sessions) into…
You guessed it, the annuity. That awful, beat up, misunderstood and bullied financial instrument that falls into the monetary hierarchy between savings accounts / Cd’s and the stock market.
Let me first say, annuities are not for everyone and I do not consider annuities to be an investment in a portfolio. After all it is an insurance product and should not be considered anything else. However, when they are positioned to provide stability, protection against loss of principle and reduction of risk in a financial plan, they are unmatched by any other financial instrument.
Robert Ibbotson, a renowned financial expert agrees. Ibbotson is a 10-time recipient of Graham & Dodd Awards for financial research excellence and a professor emeritus at the Yale School of Management. Today, Ibbotson's latest research validates that uncapped FIAs (Fixed Indexed Annuities) help control equity market risk, mitigate longevity risk, and have the strong potential to outperform bonds in the very near future.
Suze Orman, an internationally acclaimed personal finance expert has been recommending indexed annuities to shield your retirement nest egg from market volatility for some time. In her NY Times best selling book, “The Road to Wealth,” Suze Orman tells readers that “if you don’t want to take risk but still want to play the stock market, a good index annuity might be right for you.”
True, the circumstances of an individual’s life, goals and retirement needs to be identified, discussed and put in order first before even considering an annuity. Before making a judgement call on whether an annuity should be included in your planning process, I always recommend a little education first. To learn more about annuity basics, read this article on my website: What is an Annuity?
This article is not intended to give you all the details, stats, pros and cons of annuities. Its purpose is simply to illustrate a way to help you keep the money you’ve earned and serve as an alternative to gambling away any portion of your nest egg benchmarked for your essential spending. Depending on your needs, availability of assets and financial goals, annuities if utilized and set up correctly, can provide a guaranteed solution for predictable income that you can’t outlive.
A final note: As with any bull run, your investments are at an all-time high in gross value (minus the recent decline of market value) which translates into higher purchasing power. If in December 2017 you re-allocated of a portion of your IRA, 401k, 403b and or brokerage account into a tax-deferred annuity, it would have would have bought you more then it will today.
How much longer will you wait to consider these benefits? When you lose another 4%, 6%, 10%? Something to ponder.
Now you know there is a way… to stay north when the market heads south.
As always, retire wisely my friends...
Finding a reputable and trusted partner to assist you with your financial & insurance needs is of vital importance. I will work hard to find the best programs, coverage and rates that fits your budget and your needs. Contact me at 949-216-8459 or email@example.com
Other articles about Annuities:
What Are Annuities?
Alternatives to Low Paying Bank CD’s
Information and materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice. The above information is not intended to provide, and should not be relied on for, tax, legal, accounting or investment advice.
Coliday / Craig Colley is not giving any financial advice, is not a financial advisor and is not affiliated, employed or endorsed by the SSA, Medicare.gov. or any other government agency.
1) http://www.dictionary.com/browse/go-south 2)https://www.google.com/searchq=how+to+stay+north+when+the+market+goes+south&oq=how+to+stay+north+when+the+market+goes+south&aqs=chrome..69i57.47458j0j7&sourceid=chrome&ie=UTF-8 3)graph https://www.nytimes.com/2018/02/05/business/stocks-equities-dow-markets.html
The Color of Money Risk Analysis assesses your financial picture and provides a roadmap to your overall risk preferences. The output will be a proprietary Color of Money score. This short, interactive analysis is the first step on the road to retirement.
Did my question make you wonder what colors have to do with money? The amount of money we earn, save and spend is driven by our personality and beliefs.
This can also drive the choices we make about what we do with that money. In short, the investments we choose determines the color of our money. It reflects our overall personality, lifestyle and values, as well as our spending and saving methodologies.
Red- These assets have a higher degree of risk. There is good growth opportunity, but preparing for volatility is important with these assets. Red does not mean the assets are dangerous. It simply means you should stop, look both directions and proceed with caution in making your investment decisions.
Yellow- These assets are safer but still call for cautious examination. There are unique growth opportunities and Yellow assets do not carry as much risk as Red assets. You may not have as much growth opportunity as Red money, but you do not need to come to a complete retirement stop before proceeding.
Green- Green money should be labeled on assets that have safety and guarantees. Your growth potential is less than Red and Yellow money, but you may move comfortably through retirement knowing your assets are safe and available to provide the income stream you are looking for in retirement.
Striking a healthy balance with the colors of your money can help you reach your pre and post retirement goals.
Each color of money has unique benefits and features.
Life insurance has several purposes. Its most important function is to replace the earnings that would cease at the death of the insured. For businesses, life insurance is a way to protect key employees and the business itself. A third purpose is to use life insurance to pay potential estate taxes.
If you die during your earning years, your family could suffer a severe economic loss as a result of losing your current and future income. Unfortunately, your family would still have to pay its regular bills, the mortgage, and outstanding debts, and perhaps even continue saving for college and retirement. Unless you're independently wealthy, achieving these goals may be virtually impossible for your family with the loss of your steady income. Life insurance offers a way for your family to continue living comfortably and without worry.
Employers often purchase life insurance policies on key employees to insure against the loss of services or income that might result after an employee's death. Here, the proceeds from the policy are paid to the company. Life insurance works for business partners too, where one business partner purchases a policy to insure against the financial loss that might result from the other partner's death or to buy out the partner's heirs.
Life insurance is also used to pay potential federal estate taxes. Since these taxes must be paid in cash, life insurance can be a good way to ensure the fulfillment of this obligation.5
4. https://us.axa.com/axa-products/life-insurance/questions/why-do-i-need-life-insurance.html 5. gradientfinancialgroup.com Newsletter Insurance products and services are offered through Craig Colley | Coliday and is not affiliated with Gradient Securities, LLC. Some of these materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice. The above information is not intended to provide, and should not be relied on for, tax, legal, or accounting advice.
Social Security Claiming Strategies for Married Couples 1
Deciding when to begin receiving Social Security benefits is a major financial issue for anyone approaching retirement because the age at which you apply for benefits will affect the amount you'll receive. If you're married, this decision can be especially complicated because you and your spouse will need to plan together taking into account the Social Security benefits you may each be entitled to. For example, married couples may qualify for retirement benefits based on their own earnings records, and/or for spousal benefits based on their spouse's earnings record. In addition, a surviving spouse may qualify for widow or widower's benefits based on what his or her spouse was receiving.
One claiming strategy that has been used to boost Social Security income was recently eliminated by new rules contained in the Bipartisan Budget Act of 2015. However, depending on your age, you may still have a limited window to take advantage of this strategy before the new rules take effect. It can be used in a variety of scenarios, but here's how they generally work.
File for one benefit, then the other
To file a restricted application and claim only spousal benefits at age 66, you must have turned age 62 by January 2, 2016. At the time you file, your spouse must have already claimed Social Security retirement benefits or filed and suspended benefits. If you were born in 1954 or later, you will not be able to use this strategy because under the new rules, an individual who files a benefit application will be deemed to have filed for both worker and spousal benefits and will receive whichever benefit is higher. He or she will no longer be able to file only for spousal benefits and will not be able to switch from one benefit to another at a later date.
A second strategy that can be used to increase household income for retirees is to have one spouse file a restricted application for spousal benefits at full retirement age, then switch to his or her own higher retirement benefit later.
Once a spouse reaches full retirement age and is eligible for a spousal benefit based on his or her spouse's earnings record and a retirement benefit based on his or her own earnings record, he or she can choose to file a restricted application for spousal benefits, then delay applying for retirement benefits on his or her own earnings record (up until age 70) in order to earn delayed retirement credits. This may help to maximize survivor's income as well as retirement income, because the surviving spouse will be eligible for the greater of his or her own benefit or 100% of the spouse's benefit.
This strategy can be used in a variety of scenarios, but here's one hypothetical example that illustrates how it might be used when both spouses have substantial earnings but don't want to postpone applying for benefits altogether. Liz files for her Social Security retirement benefit of $2,400 per month at age 66 (based on her own earnings record), but her husband Tim wants to wait until age 70 to file. At age 66 (his full retirement age) Tim applies for spousal benefits based on Liz's earnings record (Liz has already filed for benefits) and receives 50% of Liz's benefit amount ($1,200 per month). He then delays applying for benefits based on his own earnings record ($2,100 per month at full retirement age) so that he can earn delayed retirement credits. At age 70, Tim switches from collecting a spousal benefit to his own larger worker's retirement benefit of $2,772 per month (32% higher than at age 66). This not only increases Liz and Tim's household income but also enables Liz to receive a larger survivor's benefit in the event of Tim's death.
1.https://www.foremostadvice.com/fmaweb/Advisor/PresentationCenterDetails.aspx?iplf=gb&cat=GovernmentBenefits 2. http://www.huffingtonpost.com/2015/02/13/how-to-say-i-love-you_n_6652608.html 3. http://www.foodnetwork.com/recipes/food-network-kitchens/brownie-batter-truffles.html?oc=linkback 5. gradientfinancialgroup.com Newsletter Insurance products and services are offered through Craig Colley | Coliday and is not affiliated with Gradient Securities, LLC. Some of these materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice. The above information is not intended to provide, and should not be relied on for, tax, legal, or accounting advice.
Retirement planning course corrections to consider4
It’s no secret that millions of Americans are approaching their retirement years with meager savings and high anxiety about their financial security. And a recent study from Merrill Lynch and Age Wave reveals steps that Americans are willing to take to get their retirement back on track.
The overwhelming majority (88 percent) of people surveyed said their primary objective is peace of mind, while just 12 percent say they want to accumulate as much wealth as possible. But peace of mind means different things to different people:
Only 8 percent of survey respondents feel personal finances can be discussed openly, while the remainder consider the topic a private matter or one that can be discussed with a spouse or partner or only very close family and friends. It would certainly help if older workers and retirees would share their ideas and insights with their family and friends.
What changes are people willing to make to enhance their financial security in retirement? Here are steps the survey found Americans are willing to take:
In addition to taking these steps, older workers would be wise to develop a strategy for generating lifetime retirement income, explore their options for continuing to work and make sure they have adequate medical insurance that supplements Medicare.
As you can see, your financial security in retirement has many moving parts. It is well worth spending hours and days planning for peace of mind in your retirement years, so you can go enjoy the rest of your life.5
1. http://travel.aarp.org/articles-tips/articles/info-09-2014/fall-foliage-trips-photo.html#slide3 2. Broadridge Investor Communication Solutions, Inc. Copyright, 2017 3. http://allrecipes.com/recipe/13801/apple-butter-spice-cake/ 4. http://www.cbsnews.com/news/retirement-planning-course-corrections-to-consider/5. https: //www.forbes.com/sites/robertlaura/2017/05/26/7-of-the-best-retirement-quotes-to-get-you-to-and-through-it/#5baea2db6c2b 6. gradientfinancialgroup.com Newsletter Insurance products and services are offered through Craig Colley | Coliday and is not affiliated with Gradient Securities, LLC. Some of these materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice. The above information is not intended to provide, and should not be relied on for, financial, insurance, tax, legal, or accounting advice.
How to Get a Bigger Social Security Retirement Benefit 1
Many people decide to begin receiving early Social Security retirement benefits. In fact, according to the Social Security Administration, about 72% of retired workers receive benefits prior to their full retirement age. But waiting longer could significantly increase your monthly retirement income, so weigh your options carefully before making a decision.
Your monthly Social Security retirement benefit is based on your lifetime earnings. Your base benefit--the amount you'll receive at full retirement age--is calculated using a formula that takes into account your 35 highest earnings years.
If you file for retirement benefits before reaching full retirement age (66 to 67, depending on your birth year), your benefit will be permanently reduced. For example, at age 62, each benefit check will be 25% to 30% less than it would have been had you waited and claimed your benefit at full retirement age (see table on next page).
Alternatively, if you postpone filing for benefits past your full retirement age, you'll earn delayed retirement credits for each month you wait, up until age 70. Delayed retirement credits will increase the amount you receive by about 8% per year if you were born in 1943 or later.
The chart below shows how a monthly benefit of $1,800 at full retirement age (66) would be affected if claimed as early as age 62 or as late as age 70. This is a hypothetical example used for illustrative purposes only; your benefits and results will vary.
Early or late?
Should you begin receiving Social Security benefits early, or wait until full retirement age or even longer? If you absolutely need the money right away, your decision is clear-cut; otherwise, there's no ''right" answer. But take time to make an informed, well-reasoned decision. Consider factors such as how much retirement income you'll need, your life expectancy, how your spouse or survivors might be affected, whether you plan to work after you start receiving benefits, and how your income taxes might be affected.5
1Broadridge Investor Communication Solutions, Inc. Copyright 2016.2 http://www.history.com/topics/halloween/jack-olantern-history/interactives/halloween-by-the-numbers3 Broadridge Investor Communication Solutions, Inc. Copyright 2016.4 http://www.foodnetwork.com/recipes/paula-deen/cheesy-squash-casserole-recipe.html#lightbox-recipe-image 5 gradientfinancialgroup.com Newsletter Insurance products and services are offered through Craig Colley | Coliday and is not affiliated with Gradient Securities, LLC. Some of these materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.
How Earnings Affect Social Security 1
If you begin to receive Social Security retirement (or survivor's) benefits before you reach full retirement age, money you earn over a certain limit will reduce the amount of your Social Security benefit. In 2016, your benefit will be reduced by $1 for every $2 of earnings in excess of $15,720*The chart below shows the effect of annual earnings of $10,000, $20,000, and $30,000 on a $12,000 annual Social Security benefit ($1,000 monthly) for someone who hasn't yet reached full retirement age.
Source: Social Security Administration, 2015
*Special rules apply in both the year you reach full retirement age and the year you retire if you have not reached full retirement age. If you are interested in learning when is the best time to apply for Social Security Retirement Benefits please call us at 949-216-8459 to set up a complimentary appointment to review your situation.
Four Common Questions About Social Security 4
As you near retirement, it's likely you'll have many questions about Social Security. Here are a few of the most common questions and answers about Social Security benefits.
You've probably heard media reports about the worrisome financial condition of Social Security, but how heavily should you weigh this information when deciding when to begin receiving benefits? While it's very likely that some changes will be made to Social Security (e.g., payroll taxes may increase or benefits may be reduced by a certain percentage), there's no need to base your decision about when to apply for benefits on this information alone. Although no one knows for certain what will happen, if you're within a few years of retirement, it's probable that you'll receive the benefits you've been expecting all along. If you're still a long way from retirement, it may be wise to consider various scenarios when planning for Social Security income, but keep in mind that there's been no proposal to eliminate Social Security.
You may be able to receive benefits based on an ex-spouse's earnings record if you were married at least 10 years, you're currently unmarried, and you're not entitled to a higher benefit based on your own earnings record. You can apply for a reduced spousal benefit as early as age 62 or wait until your full retirement age to receive an unreduced spousal benefit. If you've been divorced for more than two years, you can apply as soon as your ex-spouse becomes eligible for benefits, even if he or she hasn't started receiving them (assuming you're at least 62). However, if you've been divorced for less than two years, you must wait to apply for benefits based on your ex-spouse's earnings record until he or she starts receiving benefits.
Even if you plan on waiting until full retirement age or later to take your Social Security retirement benefits, make sure to sign up for Medicare. If you're 65 or older and aren't yet receiving Social Security benefits, you won't be automatically enrolled in Medicare Parts A and B.
You can sign up for Medicare when you first become eligible during your seven-month Initial Enrollment Period. This period begins three months before the month you turn 65, includes the month you turn 65, and ends three months after the month you turn 65.
The Social Security Administration recommends contacting them to sign up three months before you reach age 65, because signing up early helps you avoid a delay in coverage. For your Medicare coverage to begin during the month you turn 65, you must sign up during the first three months before the month you turn 65 (the day your coverage will start depends on your birthday). If you enroll later, the start date of your coverage will be delayed. If you don't enroll during your Initial Enrollment Period, you may pay a higher premium for Part B coverage later. Visit the Medicare website, www.medicare.gov to learn more or call the Social Security Administration at 800-772-1213.
If your pension is from a job where you paid Social Security taxes, then it won't affect your Social Security benefit. However, if your pension is from a job where you did not pay Social Security taxes (such as certain government jobs) two special provisions may apply.
The first provision, called the government pension offset (GPO), may apply if you're entitled to receive a government pension as well as Social Security spousal retirement or survivor's benefits based on your spouse's (or former spouse's) earnings. Under this provision, your spousal or survivor's benefit may be reduced by two-thirds of your government pension (some exceptions apply).
The windfall elimination provision (WEP) affects how your Social Security retirement or disability benefit is figured if you receive a pension from work not covered by Social Security. The formula used to figure your benefit is modified, resulting in a lower Social Security benefit.5
1 4 5 Broadridge Investor Communication Solutions, Inc. Copyright 2016.2 http://www.history.com/topics/halloween/jack-olantern-history/interactives/halloween-by-the-numbers 3 http://www.recipeboy.com/2014/09/nutella-cheesecake-pumpkin-bread/ 6 http://www.history.com/topics/thanksgiving/history-of-thanksgiving 5 gradientfinancialgroup.com Newsletter Insurance products and services are offered through Craig Colley | Coliday and is not affiliated with Gradient Securities, LLC. Some of these materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.
Resolving Projected Income Shortfalls: Bridging the Gap 1
What is a projected income shortfall?
When you determine your retirement income needs, you make your projections based on the type of lifestyle you plan to have and the desired timing of your retirement. However, you may find that reality is not in sync with your projections and it looks like your retirement income will be insufficient for the rate you plan to spend it. This is called a projected income shortfall. If you find yourself in such a situation, finding the best solution will depend on several factors, including the following:
Several methods of coping with projected income shortfalls are described in the following sections.
One way of dealing with a projected income shortfall is to stay in the workforce longer than you had planned. This will allow you to continue supporting yourself with a salary rather than dipping into your retirement savings.
What it means
Delaying your retirement could mean that you continue to work longer than you had originally planned. Or it might mean finding a new full- or part-time job and living off the income from this job. By doing so, you can delay taking Social Security benefits or distributions from retirement accounts. The longer you delay tapping into these sources, the longer the money will last when you do begin taking it.
While you might hesitate to start on a new career path late in life, there may actually be certain unique opportunities that would not have been available earlier in life. For example, you might consider entering the consulting field, based on the expertise you have gained through a lifetime of employment. This decision may involve tax issues, so it may be beneficial to review its tax impact with a tax professional.
Effect on Social Security benefits
The Social Security Administration has set a "normal retirement age" which varies between 65 and 67, depending on your date of birth. You can elect to receive Social Security retirement benefits as early as age 62, but if you begin receiving benefits before your normal retirement age, your benefits will be decreased. Conversely, if you elect to delay retirement, you can increase your annual Social Security benefits. There are two reasons for this. First, each additional year that you work adds an additional year of earnings to your Social Security record, resulting in potentially higher retirement benefits. Second, the Social Security Administration gives you a credit for each month you delay retirement, up to age 70.
Effect on IRA and employer-sponsored retirement plan distributions
The longer you delay retirement, the longer you can contribute to your IRA or employer-sponsored retirement plan. However, if you have a traditional IRA, you must start taking required minimum distributions (and stop contributing) when you reach age 70½. If you fail to take the minimum distribution, you will be subject to a 50 percent penalty on the amount that should have been distributed. If you have a Roth IRA, you are not required to take any distributions while you are alive, and you can continue to make contributions after age 70½ if you are still working. Minimum distribution rules do not apply to money in qualified retirement plans until you reach age 70½ or retire (whichever occurs later), unless you own 5 percent or more of your employer. >
Save more money
You may be able to deal with projected retirement income shortfalls by adjusting your spending habits, thus allowing you to save more money for retirement. Depending on how many years you have before retirement, you may be able to get by with only minor changes to your spending habits. However, if retirement is fast approaching, drastic changes may be needed.
Make major changes to your spending pattern
If you expect to fall far short of your retirement income needs or if retirement is only a few years away, you may need to change your spending patterns drastically to save enough to cover the shortfall.
You should create a written budget so you can easily see where your money goes and where you can reduce your spending. The following are some suggested changes you may choose to implement:
Make minor changes to your spending patterns
Minor changes can also make a difference. You'd be surprised how quickly your savings add up when you implement several small changes to your spending patterns. The following are several areas you might consider when adjusting your spending patterns:
Continue saving during your retirement
Don't think of your retirement date as your deadline for saving. Instead, continue to save money throughout your retirement years. Saving may become more difficult after retirement as a result of reduced income and potentially increased medical expenses. Putting away just a little each month can make a significant difference in how long your money will last.
Note that some of the powerful tax-deferred savings vehicles you took advantage of while working may no longer be available to you during retirement. To participate in a 401(k), for example, you must be employed by a company that offers such a plan and must meet the employer's eligibility requirements (e.g., length of service). IRAs only allow you to contribute earned income (i.e., job earnings) and generally don't permit any contributions after age 70½ (except in the case of Roth IRAs).
Re-evaluate your standard of living in retirement
If your projected income shortfall is severe enough or if time is too tight, you may realize that no matter what measures you take, you will not be able to afford the lifestyle you want during your retirement years. You may simply have to accept the fact that your retirement will not be the jet-setting, luxurious, permanent vacation you had envisioned. Recognize the difference between the things you want and the things you need and you'll have an easier time deciding where you can make adjustments. Here are a few suggestions:
How much money should I keep in a savings account for emergencies?
You may have already set up an emergency fund. Did you put the cash in a five-year certificate of deposit (CD) or other long-term investment? In an emergency, you will need to get at those funds immediately. You can certainly pull your money out of the CD early, but you'll pay a penalty. It's better to keep some funds more liquid, in a traditional savings account, a money market deposit account, or a six-month CD, for example. That way, the cash will be readily available when you need it.
Finally, keep your emergency fund separate from your everyday accounts. You might even want to use a different bank. Unless you are extremely disciplined, you'll be tempted to spend those extra funds if you keep them in your checking account. Remember, if you can put off an expense until next week, it is probably not an emergency.5
1 3Broadridge Investor Communication Solutions, Inc. Copyright 2015. 2 http://www.womansday.com/home/organizing-cleaning/tips/a109/100-ways-to-get-organized 4 http://www.foodnetwork.com/recipes/quinoa-salad-recipe0.html 5 gradientfinancialgroup.com Newsletter Insurance products and services are offered through Craig Colley | Coliday and is not affiliated with Gradient Securities, LLC. Some of these materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.
When it comes to your finances, some birthdays are more important than others. Take this quiz to see if you can identify the ages that might trigger financial changes.
1. Eligibility for Medicare coverage begins at what age?
2. A child can stay on a parent's health insurance plan until what age?
3. At this age individuals who are making contributions to a traditional or Roth IRA or an employer-sponsored retirement plan can begin making "catch-up" contributions.
4. This age is most often associated with drops in auto insurance premiums.
5. Individuals who have contributed enough to Social Security to qualify for retirement benefits become eligible to begin collecting reduced benefits starting at what age?
1. b. 65. Medicare eligibility begins at age 65, although people with certain conditions or disabilities may be able to enroll at a younger age. You'll be automatically enrolled in Medicare when you turn 65 if you're already receiving Social Security benefits, or you can sign up on your own if you meet eligibility requirements.
2. c. 26. Under the Affordable Care Act, a child may retain his or her status as a dependent on a parent's health insurance plan until age 26. If your child is covered by your employer-based plan, coverage will typically end during the month of your child's 26th birthday. Check with the plan or your employer to find out exactly when coverage ends.
3. a. 50. If you're 50 or older, you may be able to make contributions to your IRA or employer-sponsored retirement plan above the normal contribution limit. These "catch-up" contributions are designed to help you make up a retirement savings shortfall by bumping up the amount you can save in the years leading up to retirement. If you participate in an employer-sponsored retirement plan, check plan rules--not all plans allow catch-up contributions.
4. b. 25. By age 25, drivers generally see their premiums decrease because, statistically, drivers younger than this age have higher accident rates. Gaining experience and maintaining a clean driving record should lead to lower premiums over time. However, there's no age when auto insurance rates automatically drop because rates are based on many factors, including type of vehicle and claims history, and vary by state and insurer; each individual's situation is unique.
5. a. 62. You can begin receiving Social Security retirement benefits as early as age 62. However, your benefits will be reduced by as much as 30% below what you would have received if you had waited until your full retirement age (66 to 67, depending on your year of birth).5
1 3 4Broadridge Investor Communication Solutions, Inc. Copyright 2015. 5 gradientfinancialgroup.com Newsletter Insurance products and services are offered through Craig Colley | Coliday and is not affiliated with Gradient Securities, LLC. Some of these materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.
Protect Yourself Against Identity Theft 1
Whether they're snatching your purse, diving into your dumpster, stealing your mail, or hacking into your computer, they're out to get you. Who are they? Identity thieves.
Identity thieves can empty your bank account, max out your credit cards, open new accounts in your name, and purchase furniture, cars, and even homes using your credit history. If they give your personal information to the police during an arrest and then don't show up for a court date, you may be subsequently arrested and jailed.
And what will you get for their efforts? You'll get the headache and expense of cleaning up the mess they leave behind.
You may never be able to completely prevent your identity from being stolen, but here are some steps you can take to help protect yourself from becoming a victim.
You may get your credit report for free once a year. To do so, visit www.annualcreditreport.com.
Don't give it out over the phone unless you initiate the call to an organization you trust. Ask the three major credit reporting agencies to truncate it on your credit reports. Try to avoid listing it on employment applications; offer instead to provide it during a job interview.
Don't leave home with it
Most of us carry our checkbooks and credit cards, debit cards, and telephone cards with us all the time. That's a bad idea; if your wallet or purse is stolen, the thief will have a treasure chest of new toys to play with.
Carry only the cards and/or checks you'll need for any one trip. And keep a written record of all your account numbers, credit card expiration dates, and the telephone numbers of the customer service and fraud departments in a secure place--at home.
Keep your receipts
When you make a purchase with a credit or debit card, you're given a receipt. Don't throw it away or leave it behind; it may contain your credit or debit card number. And don't leave it in the shopping bag inside your car while you continue shopping; if your car is broken into and the item you bought is stolen, your identity may be as well.
Save your receipts until you can check them against your monthly credit card and bank statements and watch your statements for purchases you didn't make.
When you toss it, shred it
Before you throw out any financial records such as credit or debit card receipts and statements, cancelled checks, or even offers for credit you receive in the mail, shred the documents, preferably with a cross-cut shredder. If you don't, you may find the panhandler going through your dumpster was looking for more than discarded leftovers.
Keep a low profile
The more your personal information is available to others, the more likely you are to be victimized by identity theft. While you don't need to become a hermit in a cave, there are steps you can take to help minimize your exposure:
Take a byte out of crime
Whatever else you may want your computer to do, you don't want it to inadvertently reveal your personal information to others. Take steps to help assure that this won't happen.
Install a firewall to prevent hackers from obtaining information from your hard drive or hijacking your computer to use it for committing other crimes. This is especially important if you use a high-speed connection that leaves you continuously connected to the Internet. Moreover, install virus protection software and update it on a regular basis.
Try to avoid storing personal and financial information on a laptop; if it's stolen, the thief may obtain more than your computer. If you must store such information on your laptop, make things as difficult as possible for a thief by protecting these files with a strong password--one that's six to eight characters long, and that contains letters (upper and lower case), numbers, and symbols.
"If a stranger calls don't answer." Opening e-mails from people you don't know, especially if you download attached files or click on hyperlinks within the message, can expose you to viruses, infect your computer with "spyware" that captures information by recording your keystrokes, or lead you to "spoofs" (websites that replicate legitimate business sites) designed to trick you into revealing personal information that can be used to steal your identity.
If you wish to visit a business's legitimate website, use your stored bookmark or type the URL address directly into the browser. If you provide personal or financial information about yourself over the Internet, do so only at secure websites; to determine if a site is secure, look for a URL that begins with "https" (instead of "http") or a lock icon on the browser's status bar.
And when it comes time to upgrade to a new computer, remove all your personal information from the old one before you dispose of it. Using the "delete" function isn't sufficient to do the job; overwrite the hard drive by using a "wipe" utility program. The minimal cost of investing in this software may save you from being wiped out later by an identity thief.5
1 3Broadridge Investor Communication Solutions, Inc. Copyright 2015.
2http://www.newsday.com/news/nation/top-10-new-year-s-resolutions-for-2015-and-how-to-keep-them-1.9753461 5 gradientfinancialgroup.com Newsletter Insurance products and services are offered through Craig Colley | Coliday and is not affiliated with Gradient Securities, LLC.