March 3, 2015

Money Decisions When You Lose Your Job

Tara S. Bernard explains in a New York Times article what to do if you lose your job. Following is a brief summary; check out the full article at:  Initial Analysis. If you are being laid off (or contemplating a sweetened package encouraging you to leave), the most pressing issues are obviously income-related: Does any extra money let you retire a few years ahead of schedule, perhaps with some part-time work? Or does it offer enough so you have a cushion until you find your next job? How much income do you need to live right now? And how long can you go, given your severance?
See article for details on these topics: Maximize Tax Savings, Severance, Pensions, 401(K), Unemployment…
Health Insurance: state and federal health insurance exchanges may offer less expensive options than Cobra.
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GET HELP If there were ever a time to seek professional help — an accountant, an unbiased financial planner or both — this is it. This is doubly true for people for whom retirement is on the horizon. Work only with planners who charge for their advice and who are legally required to put your interests first. Mistakes can be costly — and permanent — particularly if you end up working with professionals who invest your money in products, like fixed indexed annuities, that offer them lucrative commissions or kickbacks at your expense.

How Recent Events Hinder Your Investment Return

“Investors should be conscious of the recency bias when developing their portfolio. The recency bias is the habit to assume recent trends in market activity will continue well into the future. This is dangerous because purchasing the asset category that recently did well is often the equivalent of "buy high and sell low." The recency bias can cause us to make unproductive modifications to our portfolio based on recent market movements.” From David Swapp at Net Worth Advisory Group. Learn more about how to avoid allowing recency bias to negatively affect your investment returns.

March 2, 2015

How to Save for Retirement without a Company 401(k) Plan

 “Business owners and the self-employed aren't completely adrift when it comes to retirement planning. Sure, they don't have an employee-offered 401(k) or a sweet matching program that gives them free money for a percentage of anything they put away. Whether you're a Schedule C tax-filing freelancer or an S corporation owner, there are a whole lot of ways to pocket large amounts of pretax cash without relinquishing your independence according to writer Jason Nottee. This article summarizes the SEP IRA, SIMPLE IRA, and the owner-only 401(k) profit-sharing plan. Details at:
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