Albert Einstein is synonymous with genius. Yet, when talking with his friend and personal tax account, he once said, “The hardest thing in the world to understand is the income tax.” His story reveals two things: First, filing taxes can be difficult. Second, even geniuses consult financial planners.
Because filing taxes can be a complicated process, people are more likely to make small errors that can have costly consequences. But, there are steps you can take to simplify the process, avoid mistakes and save money.
There are steps available to avoid mistakes while potentially saving you more money.
We also recommend following Albert Einstein’s example and consult a Pro- A tax professional and a financial advisor. They can help you better understand your options.
From Taxation without Complication Copyright ©2017, Certified Financial Planner Board of Standards, Inc. All rights reserved. Used with permission.
Every generation believes itself unique. Unfortunately for Baby Boomers, this may be especially true about their ability to retire.
Some sociologists argue that the Baby Boomer generation has taken historical uniqueness to the extreme, rewriting the rules on just about everything: sex, marriage, work ethic, consumption, faith, and even death. Now that Baby Boomers are in or entering their 60s, it’s ironic then that many lament they cannot retire as their parents did.
In a recent survey by AARP, 44 percent of Boomers said they believed their standard of living will be worse than that of the previous generation.
Despite this result, the first Baby Boomers are often declining to delay their retirement past the age that Social Security defines as their full retirement age, according to a 2013 MetLife study. Even though these Boomers enjoy approximately five more years of life expectancy than their parents did at age 65, 52 percent of these Boomers have retired at an average age of 59.5.
On the plus side for Boomers is the fact that one of the biggest threats to retiree security — inflation — is mercifully low. Older Americans will recall a time when annual inflation averaged between 6 percent and 10 percent a year, and how cumulative inflation from 1970 to 1989 ran a whopping 162 percent.
So what’s left to retirement for Baby Boomers to figure out? What rules should they break, and which should they keep?
Defiant Boomers have always done things their way, and navigating retirement will be no exception. They are, in fact, the first generation that has to look primarily to their own resources and management – rather than to government or corporations – to invest for retirement and create an income stream from these investments.
Fortunately, financial planning and the certification of competent, ethical professionals have come of age with the Boomers, to help them make the most of this uncharted territory. Boomers will no doubt continue to “do their own thing” in retirement, but with a CFP, they can do it prudently and successfully.
From Retirement for Baby Boomers when there isn’t one Copyright ©2017, Certified Financial Planner Board of Standards, Inc. All rights reserved. Used with permission.
If people want to be able to save more, there are basically three choices: spend less money, earn more money, or some combination of the two. There’s also another option – granted, a more aggressive option – of aggressive spending cuts to achieve aggressive savings goals.
But why? Simple. Americans need to save more if they want to achieve not just wealth, but enough money to live off of and not work forever.
According to the March 2016 Retirement Confidence Survey, 54% report that the total value of their household’s savings and investments, excluding the value of their primary home and any defined benefit (DB) plans, is less than $25,000. This includes 26% who say they have less than $1,000 in savings. That’s not good news.
So, how to kick start saving aggressively – cut spending. Here are some tips:
I have always said that spend, spend, spend may lead to the poorhouse and save, save, save may lead to resentment. But if it is crunch-time and you are serious about saving aggressively, in order to save, save, save, you have no choice but to spend less, less, less!
From Crunch Time…Strategies for Aggressive Saving Copyright ©2017, Certified Financial Planner Board of Standards, Inc. All rights reserved. Used with permission.
At HFM we know many business owners that are great at what they do, (build houses, sell appliances, provide IT services) but need help managing their finances. We agree with this article that these are the areas where expertise is a necessity.
Who hasn’t dreamed about starting a business?
Becoming a successful entrepreneur has replaced home ownership as the new definition of the American Dream, thanks to the recent collapse of the real estate market and the made-for-Hollywood stories of folks like Steve Jobs or Mark Zuckerberg, of Apple and Facebook, respectively.
But while Jobs and Zuckerberg have become household names, fame ought to be the least of the attractions in owning a business. More compelling to the tens of thousands of individuals starting a small business every year is the allure of being master of one’s own professional success.
But there are also significant risks to going out on your own. Unfortunately, the failure rate of small business is high, with only 20 percent of new businesses surviving for five years. Another depressing statistic: fewer than 40 percent of self-employed persons working alone make more than $25,000 a year.
The old saying, “No one plans to fail, but many fail to plan,” has special applicability to the new business owner. Starting up can be deceptively simple: Facebook was launched with just an innovative idea, a laptop, and a dorm room. But from the very outset, business owners need to be aware that even the most basic business model entails considerable financial planning complexity.
Comprehensive financial planning for an individual or couple generally involves tax planning, risk management, investment planning, retirement planning and gift and estate planning.
One point should be clear when it comes to financial planning for the small business owner: the do-it-yourself drive that helped you start your business will not serve you well when it comes to managing the many financial issues created by that business. This is where professional expertise often becomes necessary.
Exercise your privileges as chief executive officer, and delegate these issues to qualified tax and financial planning professionals. Their advice can make all the difference in improving your chances of business success.
From Financial Planning for Small Business Owners Copyright ©2017, Certified Financial Planner Board of Standards, Inc. All rights reserved. Used with permission.