Financial Resolutions for the New Year.

As another year comes to an end it is always a time for reflection.

Reflecting back on 2013 the lessons learned, and things achieved.

It has been a good year a great year in fact.

But it is almost time to welcome 2014, new lessons to be learned and new goals to be achieved for the year that lies ahead of us.

New Year’s resolutions to be made!

Honestly I am not a big fan of New Year resolutions.

Why?

Well resolutions are not supposed to be a wish list; they are not to be taken lightly like a shopping list.

So sometimes it is easier to avoid making them than make them and not be able to keep them.

New Year’s resolutions are decisions we make about what we want to achieve in the year ahead and then we need to follow through with them until we have achieved them.

The 5 Top Financial Mistakes That Women Often Make!

Women are working now more than ever before.

Juggling life as a professional business women, wife and mother.

Women are living longer than their male counterparts and therefore need to be more financially savvy about how their money is going to last them throughout their lifetime.

Unfortunately however women are still not allowing themselves the valuable time that they need, to get themselves educated when it comes to their finances.

Now Is A Good Time to Talk Finances

It’s that time of year again!

Yes the holidays are here.

Where has the year gone!  I’m I the only one that feels that the year has flown by?

I have so much to be thankful for.

I hope you and your family do too.

I am thankful each and every single day, but the holidays are that special time of the year that I love to take the time with my family to reflect on just how much we really do have to be thankful for.

The Importance of Life Insurance Within Your Financial Plan?

 So you know you should have life insurance. Right?

Is it something that you should only have for emergencies?

You know for your family in the event that something was to happen to you.

What can life insurance possibly have to do with your financial plan?

Even if it did, which life insurance would be of benefit to you financially long term?

Where do you even begin with so many types of life insurance out there?

Will Having a Financial Plan Benefit You?

 Could it be more vital for women to have a Financial Plan than a man?

Even though statistics show that women are less likely to actually have one.

Often women fall into the trap of using the men in their lives as their Financial Plan.

But women need to have their own financial plan.

When we take in to consideration that women live longer, typically earn 25 percent less than men and spend more time out of the workforce than men.

This can only lead to us needing our own financial plan and no longer rely on anyone else for our plan.

Women and long term financial planning.

Typically women tend to keep putting this of and are waiting too long to start their long term financial planning.  But it is something that needs to be planned sooner rather than later.  It is important to set goals like when you want to retire, how much you will need as an income when you retire, how much you will need for your travel plans and how much you want for your families.  The sooner you have these goals to aim for the more likely you are going to achieve them on the timeline that you want.

Being Rich does not mean you don’t need a plan.

Often the misconception is that when people earn lots of money they do not need to have a financial plan.  This could not be further from the truth because making lots of money does not automatically make someone rich, it does not ultimately determine your wealth; it is how much of that money that you are investing that determines your wealth.  Often what happens is that people who do earn a lot of money never see themselves as having financial concerns so they never seek advice with creating a financial plan.  But failing to invest for your future may hinder you from having a comfortable retirement.

The danger of relying on one spouse to take care of the financial planning.

Being reliant on one spouse within a marriage to take care of the finances can be dangerous, as statistics show that unfortunately almost as many as 50 percent of marriages end in divorce.  Even with the best divorce attorney, helping you get alimony and child support it is a fact that the standard of living for women can significantly drop.

Widowhood is another danger of having one spouse dealing with the finances, the average age of widowhood is 56 years old, which usually leads to women being left unprepared.  Due to that unpreparedness as many as 80 percent of widows will then live in poverty even though their husband was far from poor when he died.

  

The important steps to a good Financial Plan.

 Often asking the right questions and getting educated is all it takes to secure a financial future for yourself.  Questions like do I have enough life insurance to pay off my debt if something were to happen to me does my life insurance have any type of long term care or disability insurance within it if I were to need it in the future?  Will I have enough income to last me the rest of my life if I could no longer rely on my spouse’s pension.

Asking yourself these questions and sitting down with a professional is the start to knowing how secure your future really is, giving you the peace of mind that you deserve.

Why a Special Needs Trust?

I think as parents we could all agree parenting is not always an easy job.

Some things we just get right and some things we just don’t?

As parent’s we can never be expected to know everything that our kids will need.

But we do know how much planning is involved when it comes to planning for our children’s future.

Planning for the parents of children with special needs can often become an extremely daunting task.

I am sure a question they are always asking themselves is who is going to take care of their special needs child when they are gone.

Special Needs Trust planning is something where the parents should seek the advice of an expert.

For parents of children with disabilities or special needs it is vital for them to have an effective estate plan, which puts them in control of their finances while they are alive giving them the peace of mind that their children will be taken care of in their absence.

A Special Needs Trust helps ensure that the beneficiary receives the benefits in the way the parents intended and protects them against losing access to the government benefits, which can be affected by as little at $2000 if your child was to receive this as inheritance directly.  Which in most cases because of lack of knowledge in this area, leads them to disinheriting their special needs child and they leave the money to someone who they think they can count on to take care of their child.  In most cases however this is not the best answer.

Special Needs trusts can be used to supplement and never replace the government benefits that special needs children are entitled to.  But parents need to be educated on any restrictions that could affect the benefits their child receives.  Special needs trusts should be created to provide additional benefits while protecting the assets of the special need child.

Creating a Special Needs Trust ensures peace of mind as it allows the assets to be managed by someone who has been previously chosen by the parents, because in most cases they cannot be managed by the child on their own and can prevent the assets from being wasted away.

Of course estate planning in the case of special needs planning is no less of an emotional roller-coaster than any other estate planning; it is always a difficult process to go through.

But it is very satisfying for the parents when they have done it, knowing that they now have the peace of mind that their children will be taken care of by people they have chosen and in the way that they have instructed when they no longer can.  Making this one of the most important things a parent of a special needs child can do for them.

So if you are the parent of a special needs child do not put it off, it is vitally important that you make the choices for your child’s future and that you do not leave it to chance.

Have you Reviewed your Beneficiaries Lately?

Have You reviewed your beneficiaries lately?

That’s not something that you think of doing very often. 

For some it may be something they ever really think about.

So maybe it just not that important.

Anyway I am just too busy to take care of that right now, and I thought I was done with all my ‘housekeeping’ chores when I opened my financial accounts.

Reviewing my beneficiaries, it doesn’t seem like an urgent task anyway, my money will all go to the right place in the end. Or will it? 

Reviewing our beneficiaries is more important than we think.

Actually it is something that should be considered a top priority on all your current investments, insurance policies and financial accounts.

How can this make that much of a difference, maybe the question you are asking yourself?

Here is why it needs to take top priority on our ‘to do list’.

Beneficiary Designation supersedes one’s will.

If your beneficiary information is not current, when you pass away your assets will more than likely be distributed to an unintended heir?  As the beneficiary that you have listed can and does it most cases supersede even an up to date will.

Tax Related Benefits.

Not naming a beneficiary or naming your estate can be as equally bad, as by doing this you could be giving up some tax strategy rights as well as control.  Having beneficiary designations can help extend tax related benefits and reduce the tax burden on your beneficiaries.

Take the Time to Review your Beneficiary Details.

Life transitions can change everything for us.  Recently been married, divorced, had a new baby or even a death in your family since you originally opened your accounts or got that life insurance policy?  Well it is time to review and get updated your beneficiary designations.  By taking the time to do this you will be ensuring your wishes are carried out and you will be preventing your loved ones from the added stress that comes with the legal complications at your time of death if not done.

It should not be one of those job’s you will get to later, call your advisor today, don’t be in doubt make sure you take care of this vitally important issue and give yourself the gift of peace of mind that your family will be taken care of in the event of your death.

Love, Marriage and Money

 Even when we are truly in love, we still need to talk about money.

I know it is the last thing you want to talk about before you get married.

You can sort all that stuff out afterwards right?

No!

Think about it this way.

Have you ever cheated on your partner?

I mean with money.

Probably, I know I have.

You know the kind of cheating I am talking about.

The kind, when you buy a new outfit, you put it in the closet without mentioning it.

Or when you buy a new pair of shoes and you say you got them in the sale, when actually you paid top dollar for them. Maybe it’s not telling your partner how much you charged to your credit card when doing the Christmas shopping.

Did you know that money causes the most arguments and breakups in any marriage?

So before tying the knot be sure you are open and honest about finances.

Here are a few things that should be discussed beforehand.

Is There any Existing Debt?

Nowadays it is very common to leave college with debt, it is important to be honest about how much debt you are bringing to the marriage.  It has to be decided how the debt will be paid off and if you are going to pay it off jointly or separately.

Are there any Existing Investments?

This is obviously better than bringing debt to the marriage, but it is also something that needs to be discussed beforehand.  Will these investments now be held jointly, and if so how will this be done and how will you maximize these investments?

Don’t forget about insurance.

Life, health and home insurance.  All existing insurance needs to be taken into consideration possibly combining and reviewing, making sure that it is now in keeping with your new circumstances and that you have enough coverage as a couple.

What about Retirement.

Often this topic is best discussed with a Financial Advisor who can help you with the financial goals that you have as a couple, someone who can guide you to make the best decisions on how to invest and manage your money for your future retirement.

Estate Planning.

When entering into a marriage it is especially important that you do not neglect your Estate Planning, no matter how young you are.  If you already have some Estate Planning done you will have to have these documents updated to be aligned to your new situation.

Do I need a prenup?

Well a prenup probably doesn’t seem like the most romantic thing in the world, but it is a very important part of the planning.  As statistics show that a high percentage of marriages do end in divorce these days.  It is not just for the rich, it is for everyone.  It helps set the rules for situations like if one partner has more debt than the other or maybe if one partner is entering the marriage already owning a business.

Talk about it and be honest.

Money is a difficult conversation, but avoiding the discussion can lead to a lot of arguments down the road.  Don’t let small problems grow into unnecessary ones just because you felt uncomfortable about talking about your finances.  Seek advice from an expert to help you.

Are you planning to get married soon but haven’t yet spoken to a professional?  Don’t put it off any longer call my office today and schedule a free consultation.  Start your marriage of on the right foot.  239 288 0974. Karla White - Waterstone Financial