It’s Summertime – Time for a Midyear Financial Checkup
Written by Kristine McKinley · June 26, 2009
The weather’s great, so staying inside with your finances probably doesn’t sound like a very entertaining option. But a midyear review of your taxes, retirement and spending issues can be far more valuable than the rushed attempt most people make at the end of the year-or when it’s too late at tax time.
Summer’s actually a good time to do this task because there’s still enough time to correct lapses in savings, spending or tax planning. Here’s what most people should cover:
Retirement savings:
Given the state of the economy, it’s not a bad time to review your retirement funds and your current investment allocation. If you are on schedule to max out your contributions to your company retirement plan this year, great. But don’t forget to check your existing IRAs and other retirement accounts to see if you’ll have enough cash on hand to contribute the maximum in each account by their respective deadlines next year.
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Related PostsCommon Social Security Retirement Questions
Written by Kristine McKinley · June 23, 2009
As Baby Boomers are getting closer and closer to retirement, they have many questions about Social Security, such as…
Will Social Security be there for me when it’s my time to collect benefits?
For a long time the media has been telling us that Social Security is going bust. Millions of Americans depend on Social Security to fund all or part of their retirement, so this is a huge concern in our country. So do we really need to worry about Social Security going under before we start collecting our retirement benefits?
The 2009 Social Security Trustees Report anticipates that Social Security benefits paid to retirees will exceed Social Security taxes paid in by workers (and earnings on the funds in the trust) beginning in 2016. In addition, the trust fund could be exhausted by 2037. Once the trust fund is gone, benefits will still be paid out, but the taxes collected from people still working will only be enough to cover 76% of the benefits promised.
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Related PostsMaking Safer Investment Decisions in 2009
Written by Kristine McKinley · January 21, 2009
It’s hard to say what 2009 will look like. While there are still several concerns (the housing market, rising unemployment, etc.), there will also be considerable government intervention to help improve the economy this year, both in the U.S. and worldwide.
So what should you do in 2009 to make your portfolio and overall financial picture better? Here are some general ideas to employ as markets and economies hopefully stabilize in the New Year:
Start with a plan (or review an old one): If you’ve worked with a financial planner in the past, now is a good time to review your plan to make sure you are still on track to meet your goals. If you haven’t worked with a financial planner before, or if you haven’t prepared a financial plan before, it might be time to meet with a Certified Financial Planner™ to create a plan. Much of the riskiest investing, overbuying and panic selling during the late 1990s and early 2000s could have been avoided if individual investors had sought advice for achieving long-term specific goals such as retirement or a college education.
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Related PostsShould You Move to “Safer” Investments?
Written by Kristine McKinley · January 17, 2009
After watching their 401K balances shrink up to 40% in 2008, many people are wondering if they should change their allocation to include more “safe” investments, or if they should move completely to “safe” investments then move back into the market later.
Here’s what Walter Updegrave with Money Magazine has to say about this:
But as understandable as the urge may be to transfer all your money into the investments that seem safest – stable value funds, capital preservation funds, money market funds and the like – that would be a mistake.
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Related Posts1099-B Forms Delayed This Tax Season
Written by Kristine McKinley · January 14, 2009
The IRS has announced that brokers may furnish certain composite annual tax reporting statements by Feb. 17, 2009, without penalty.
The notice provides that the new February due date established under a recent law change to provide Form 1099-B information to customers also applies to other tax information customarily reported to customers with Form 1099-B statements, such as interest and dividends. This means that customers can expect to receive Forms 1099-INT and 1099-DIV late as well.
If you normally receive Forms 1099-INT, 1099-DIV and 1099-B for investment income and transactions, be aware that these forms will arrive later than usual this year. Some clients have reported that they have received letters from financial institutions saying not to expect these forms until the end of February (although the official due date is February 17).
As a tax preparer, I’m not particularly happy about this change, but on the bright side, I’m hoping the extended deadline will cut down on the number of corrected 1099s issued this tax season.
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