February 27, 2014

5 of the Brightest Minds (and Ideas) in Retirement Planning



Money magazine asked five of the brightest minds in retirement planning for their big ideas. These are the brains that think outside the box, challenge conventional wisdom, and are publishing their work in top financial planning journals and leading the think tanks.
Forget the 4% withdrawal rule: Wade Pfau, professor of retirement income, American College
You'll spend less as you age: David Blanchett, director of research, Morningstar Investment Management
Plan to pay for future health costs: Carolyn McClanahan, president, Life Planning Partners
Plan for the critical first decade: Michael Kitces, partner and director of research, Pinnacle Advisory
Social Security is the best deal: Alicia Munnell, professor of management, Boston College Read their recommendations: http://money.cnn.com/2014/02/26/retirement/retirement-social-security.moneymag/index.html

Be Aware of the Impact of Fund Fees



Are excessive financial fees eating your returns?  “Many investors are simply unaware of how much they are paying in fees. Morgan Housel notes how one friend wasn't aware that a 1.5% annual fee equated to a massive expense.” "Over Christmas, a family friend asked me to take a look at her finances. She's in her 60s, worked hard her whole life, and accumulated a couple of million dollars to retire on. She's had a financial adviser at one of the nation's largest banks for the past five years. I met him once; he's a nice guy. Smart, able, honest, and competent, he put my friend in a basket of investments -- mostly low-cost index funds, a few individual stocks, and a portfolio of bonds -- keeping her on track to enjoy a comfortable retirement.She's happy with her adviser. For the most part, I was, too. There's just one problem: He charges an incredible 1.5% of assets as his annual fee. I tried to explain to my friend how high this was, but my comments were met with a shoulder shrug. One and a half percent didn't sound like much to her.” BUT… “It was literally the single largest line item on her budget. More than her mortgage, more than her food bill, more than she spent on travel, clothes, entertainment, gifts, medical care, cars, and tuition for her kids." USA Today (2/24) What are you paying in investment fees? http://www.usatoday.com/story/money/personalfinance/2014/02/24/where-are-the-customers-yachts/5785353/

February 24, 2014

Take Charge of Your Financial Future Webinar Feb. 28

Take Charge of Your Financial Future” will be held from 1:00-2:00 p.m. EST on Friday, February 28.
As part of America Saves Week 2014, the U.S. Department of Labor’s Employee Benefits Security Administration will host a webcast in coordination with the Department of Education and the NAACP Financial Freedom Center. The webcast will help college seniors and young workers get a good financial start including paying down student loans, determining a budget, managing credit, and starting to save for retirement.Take Charge of Your Financial Future” will be held from 1:00-2:00 p.m. EST on Friday, February 28.
Members of the public can register here or on the EBSA website www.dol.gov/ebsa.
For more information, read the Department of Labor blog, Your Financial Future Begins Today – Deal With It!
http://social.dol.gov/blog/your-financial-future-begins-today-%e2%80%93-deal-with-it/

February 13, 2014

10 Questions to Ask a Financial Adviser

1. What experience do you have?
2. What are your qualifications?
3. What services do you offer?
4. What is your approach to financial planning?
5. Will you be the only person working with me?
6. How will I pay for your services?
7. How much do you typically charge?
8. Could anyone besides me benefit from your recommendations? (Ask about conflicts of interests.)
9. Have you ever been publicly disciplined for any unlawful or unethical actions in your professional career?
10. Can I have it in writing?
Read the details by Philip Moeller at: http://money.usnews.com/money/personal-finance/financial-advisors/articles/2014/02/11/10-questions-to-ask-a-financial-advisor

February 6, 2014

Get Paid to Save for Retirement

IRS Gives Money to Low-Income Retirement Savers
“Workers meeting the agency’s income requirements can receive a Saver’s Tax Credit equal to as much as half of their total deposits into a 401(k) or IRA. The lower one’s income, the bigger the credit.”
“Since it’s a credit, taxpayers receive either an outright refund or a reduction in their taxes owed. The credits are capped at $1,000 for individuals and heads of households and $2,000 for married couples. But they are in addition to deductions for 401(k) contributions, which lower the taxable incomes of any worker who saves.” Read the details and find if you (or your adult children) qualify at the Squared Away Blog: http://squaredawayblog.bc.edu/squared-away/401k-tax-credit-helps-low-income/

February 5, 2014

5 Dos and Don'ts for Greater Financial Security

With the unemployment rate slowly falling, many Americans are facing a healthier job market and trying to get their financial lives back on track. Drawing on the findings of the FINRA Investor Education Foundation's National Financial Capability Study of more than 25,000 Americans, the FINRA Foundation has developed five tips to help consumers both manage their day-to-day financial challenges and build a brighter financial future in 2014.
1.      Do Take Advantage of Tax Breaks When Saving for College and Retirement.
2.      Do Your Best to Bust Your Debt.
3.      Don't Chase Yield.
4.      Don't be Part of the 39%.
5.      Do Check Your Credit Report and Score.
Find out more at http://www.finra.org/Investors/ProtectYourself/InvestorAlerts/MoneyManagement/P443221

February 4, 2014

Frustrated with low returns on savings? Consider Peer-to-Peer Lending

Peer-to-peer lending (P2P), is an internet-based forum to connect individual lenders and borrowers. According to financial planner Kimberly Foss, "What's attractive about peer-to-peer (often called P2P) lending is that it's a winner for both funder and recipient. Borrowers pay less interest than they would for a conventional bank loan and lenders, by taking on more risk, get higher returns than they would find elsewhere in the fixed-income market." Note the phrase "by taking on more risk" as you consider if P2P is an option for you. Read more at: http://www.financial-planning.com/fp_issues/2014_2/peer-to-peer-lending-new-way-to-find-yield-2688048-1.html?pg=1

Student Loans and Student Debt Information

An excellent, reliable source for information on student loan borrowing and student debt repayment is The Project on Student Debt: http://projectonstudentdebt.org/links.vp.html. Check it out before you borrow and if you already have loans.
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