Bipartisan Budget Act of 2018 Eases 401(k) Hardship Withdrawals – But is This a Good Thing?

Everyone is still wrestling with changes affecting financial planning that occurred due to the Tax Cut and Jobs Act of 2017, but what may have been a dramatic change occurred in February this year. The Bipartisan Budget Act of 2018 (BBA) passed in February of this year. Under the BBA, hardship withdrawals from 401(k) and 403(b) plans will now be easier to obtain. At first blush, this may seem positive for plan participants, but don’t break out the bubbly just yet!

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Under current law, these hardship withdrawals (not to be confused with loans) from 401(k) and similar defined contribution plans are limited to elective deferral amounts contributed by participants. Further, once a withdrawal is taken, employees are restricted from making new contributions to their plan for six months. Also keep in mind, that with a hardship withdrawal, the participant has to pay a 10% penalty in addition to ordinary taxes. Hardship withdrawals, unlike loans, do not need to be paid back. This is changing.

With passage of the BBA, there are now some key changes coming in 2019 to hardship withdrawals. Mainly, participants can now access their elective deferral amounts in addition to earnings and employer contributions. That last part is a major change. Employees will be able to access more funds for hardship withdrawals than previously allowed.

Other key changes include:

The removal of the six-month suspension period for making contributions. Employees can continue making contributions to their plan to offset the hardship withdrawal. Participants are also eligible to receive employer contributions.

The BBA also removes the requirement that plan participants first take a loan from their plan prior to requesting a hardship withdrawal.

California residents get a special wildfire relief window period. For California residents who take a hardship withdrawal of up to $100,000 between October 8, 2017 and January 1, 2019 whose principal place of residence was in the wildfire disaster area and who sustained an economic loss due to the fires, the 10% penalty is waived.

What hasn’t changed under the BBA are the criteria for qualifying for a hardship withdrawal. The IRS still says that a hardship “must be made because of an immediate and heavy financial need of the employee and the amount must be necessary to satisfy the financial need.”  The IRS also assumes that if a participant is taking a hardship withdrawal, they have no other means of meeting the “immediate and heavy need” other than a hardship withdrawal. For more from the IRS and the rules that go along with hardship withdrawals, please read Retirement Plans FAQs on the IRS website.


Even though obtaining a hardship withdrawal and continuing to contribute to a qualified plan is now somewhat easier, it may not be a good thing to do. Eliminating the six-month suspension period for making contributions is a good thing. This, coupled with the fact that participants no longer need to take a loan first, may drive more participants to seek hardship withdrawals as opposed to loans. If a participant does take a hardship withdrawal, the participant will likely need to take an amount large enough to cover the hardship and the withholding (the 10% penalty and the ordinary income tax). Taken together, this could have a dramatic impact on your plan balance and retirement savings. By taking the withdrawal, a participant will be losing earnings on the amount withdrawn which will affect future savings for retirement.

The upshot is that even though obtaining a hardship withdrawal is easier, it should be considered very carefully. Participants need to weigh whether a traditional loan is a better choice, or whether taking the hardship withdrawal is truly the best move for their individual situation.

If you are not sure how these changes will impact your finances, contact me. As an independent Certified Financial Planner™, I can help you asses your choices and move forward.  Contact me and let’s get started. #talktometuesday #education #Hireaplanner #tax #taxfiling #stressfree #newyear #savings #taxchanges #2017TCJA #taxcuts #taxcutsjobsact #BBA #401k #403b #BipartisanBudgetAct

Emergency Fund Pain

We recently learned the value of having an emergency fund! In mid-January our sixty-eight-year-old floor heater died. Kaput! The Bay Area has a very mild climate but January and February tend to be cold months. Luckily, most of February this year was unseasonably warm. Still, we had some overnight lows and early mornings in the thirties and several days at the end of the month in the forties and we even had rain, sleet, and snow on some of the local mountains.  

Winter is the wrong time of year to be searching for a new HVAC system. The companies are swamped because it is a common time for folks to need service. They are booked! With one company we were number 106 for a service call. The short of it is, getting estimates took weeks, no one would replace our old system due to liability, and just the age of the unit (no parts availability). We needed a completely new HVAC system so we opted for air conditioning as well. Historically, homes in this area did not have AC but for the past several years, summers have been getting hotter and we have had heat spikes in the 109F range.

 The "new" cold air return register. I painted it champagne mist. 

The "new" cold air return register. I painted it champagne mist. 

Given that our home was built in the 1940s we had zero infrastructure in place for a modern HVAC system. No ducts, no register cuts in the floor, no electric to the unit under the house, no breaker for the unit, no vents, no nothing really. We needed everything! All of the estimates ranged between $18,000 to nearly $20,000 for complete system installation. So, we bit the bullet and selected a company we thought would best suit our needs.

 Previously, the new cold air return was the old heat vent. It looked awful from years of heat exposure. 

Previously, the new cold air return was the old heat vent. It looked awful from years of heat exposure. 

Here’s the upshot of the whole calamity. Had we not had an emergency fund that total would have to have been financed, or we would have had to secure a loan. Luckily, we didn’t need to pay more for financing, we did have to dip deep into the emergency reserves, but we got a tiny reward! For paying cash in full, the company we contracted offered a 3% discount on the total. That was a nice savings of nearly $600 off the final bill. I would much rather have a small discount than have to pay interest over time. Although it was painful to see that money go, we now have a comfy, modern system and are all set for decades to come.

Do you have an emergency fund? If not, start one today! Even if you can only put away a small amount at least get started. If I can guide you and help you determine how much to save give me a call. As an independent Certified Financial Planner™, I can help you with an emergency savings goal, debt reduction, and setting a timeline. #talktometuesday #education #Hireaplanner #savings #savemore #payyourselffirst #emergencyfund

Budgeting for Periodic Expenses

Yes, I’ve written a lot about spending and budgeting this first quarter. That’s because many people pick “be better with finances/money” as their New Year’s resolution. Today’s post will help those of you trying to stick to a budget, and those of you who hate budgeting to every penny.


For periodic expenses I am referring to things that occur annually and are paid either all at once, bi-annually and possibly even quarterly. Think of items like car insurance, life or long-term care insurance, personal property tax, and maybe even a vacation.

You know these expenses come due every year. But since they are not monthly like utility bills and the mortgage, many folks forget to include them in the monthly budget. The solution is simple! Total these expenses and round up by about 2% for inflation. Divide this amount by 12 and transfer that amount monthly into a separate, designated savings account just for these expenses. The money will always be there as long as you don’t raid this account for tickets to the monster truck show or a weekend spa treatment. Name the account something to reinforce the need for this money, like ‘Annual Necessities’ or some other moniker that is meaningful to you.

If you need a pro to help you, call me. As an independent Certified Financial Planner™, I can help you with a savings goal, debt reduction, examining resources available and figuring out which bills are periodic and how much money they require. #talktometuesday #savings #budget #education #Hireaplanner #savemore #payyourselffirst #budgeting #CFPPro

Save Money, Save Yourself!

It’s a challenge – do I save first or pay my debts? Many people face this very conundrum every pay period. They know in their heart that they should be saving money, but their paycheck-to-paycheck reality is very real, very stressful, and very difficult to break. The good news is that you can break the cycle. The bad news, it takes real effort and old-fashioned grit!


For those of you who feel trapped in the paycheck-to-paycheck cycle, start small by making a big decision. Start with the decision that YOU are your most important debt collector. That’s right, you come first. Pay yourself first! Make this small but powerful mindshift a reality. If you must, start small with $1, and do it every time you earn money. There are roughly 20 working days per month. Make your first goal to save $1 for each of those working days. Look yourself in the mirror every morning and repeat, “pay yourself first” until you take it to heart and believe that you are most important. By the end of the year, you’ll have your first $240 in savings!

Once you’ve become accustomed to paying yourself first, challenge yourself to take it further. Consider saving a percentage of your salary through automation. Setup a savings account to receive a percentage of your salary. Over time, your goal is to increase what you pay yourself. Give it six-to-nine months so that you become used to automated savings. Then, increase your savings percentage by 1% on a regular schedule. At first, you may want to increase your savings 1% every six months. The next level is to increase your savings rate every four months by 1%, and then every three months by 1%.

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My savings started small as a set amount each pay period. Then I started saving a small percentage (10%) pre-tax via my 401(k). I also received a match from my employer (I believe it was around 6% on the first 5% of salary). Next, I switched from the small set amount and started saving 5% post-tax into a savings account that I never touched. After that, I started doing something else that really pumped up the cashola! If my net pay deposit was, for example, $2,269 I would transfer an amount of $227 into savings. I did this with every check I received no matter what and it worked. It took me a few years to be able to do this, and I had to start with taking the rule to heart, “pay yourself first.” I was saving 10% pre-tax, plus a match, plus 15% post-tax! Savings became more of a game for me and I started increasing my savings percentage rate over time.

Let’s review your steps to get started:

Make the mindshift, YOU are most important.

Pay yourself first!

Start small; $1 per working day, move up to $5 per day, then to an amount every day!

Participate in any retirement plans offered via your employer. Don’t leave any ‘free’ match money on the table.

Increase post-tax savings from your net income.

Finally, examine your spending habits. Stop buying “stuff” and paying for services you don’t really need. It sounds simple, but live within your means. Cutting back just a little in many areas will give you the cashflow you need to start saving. Use a budgeting or spending app to track where you are spending your money and start reviewing the data. You’ll be surprised at where your money goes. Instead of eating out four nights a week with friends cut back to two nights per week. Invite them to your place instead and you’ll all save money. Buying coffee two to three times per day – that’s about $15. Cut back on just one purchase and you have your $5 per day. Carpool, take public transit, turn down the heat/AC, clip a few coupons for things you actually buy, cook at home, take your lunch to work twice a week, etc. We can all trim our spending, it just takes determination and grit.

Not sure how to start or what to do once you are saving. Call me. As an independent Certified Financial Planner™, I can help you with a savings goal, debt reduction, setting a timeline and examining resources. #talktometuesday #education #Hireaplanner #savings #savemore #payyourselffirst

Three Smart Tips for Using Your Tax Refund

A lot of folks are about to come into a mini-windfall of cash. That mini-windfall is your tax refund. After carping about not being able to save, or not being able to fund your IRA, or add to your investments, or pay down debt, this is your opportunity. Instead of envisioning all of the lovely, disposable, soon-to-be-forgotten things you could buy with your refund, consider investing in yourself for some financial peace of mind. Here are three smart ways you can use this windfall.

First, pay off debt. Look at your debts and see if the refund you are getting is enough to completely payoff a high interest debt. If it is, do that! Then use the monthly payment amount you were making on that debt to make a larger payment on the next high interest debt. Work with your financial planner and pay off the debt that gives you the greatest bang for your buck and you’ll be debt free in no time. Your financial planner can tell you which debts and in what order provide the shortest payoff time and saves you the most in interest.

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Second, build your emergency fund. If you are a two-income household, the emergency fund should be the equivalent of three to six months of total expenses. This includes all discretionary and non-discretionary spending. If you are a single-income household, you should really consider having six to nine months of total expenses as an emergency fund. Your tax refund can add nicely to your cash stash.

Third, start or add to your investments. If you have your debt under control, and your emergency fund is sufficient, now is the time to add to your investments. Your tax refund could be just the ticket. Consult your financial planner and decide whether you should be starting, or adding to, an IRA, a taxable fund, or a Roth account.

A note about tax refunds: if you are receiving an unusually large refund (and tend to do so every year) now is a great time to meet with a financial planner to figure out why. You should be receiving a smallish-to-zero refund. That way, you are enjoying the benefit of your funds all year and not making a free loan to Uncle Sam.

Keep in mind that using your refund for one of the recommended tips does not have to be an “all or nothing” approach. You should use a small amount to reward yourself and do something like a nice dinner, a day retreat, a spa, or take a cooking class with a friend or significant other. Just don’t blow your windfall on things you don’t need and won’t notice in a few weeks.

As an independent Certified Financial Planner™, I can help you decide how to put your windfall to work. Contact me and let’s get started! #talktometuesday  #refund #Hireaplanner #bonus #income #cash #CFPPro #foundmoney

Mind Your Tipping and Save Thousands Over Your Lifetime

Recently, my husband and I started paying attention to tipping. Having worked in food services, I am sensitive to this topic. We observed our tipping behavior and that of several friends over the course of a few weeks.

One thing we noticed is that many people tend to actually tip higher without realizing what they are doing. Pop quiz: do you tip on the post-tax or pre-tax amount of your bill?  Etiquette dictates that you tip on the pre-tax amount for food and beverage and not the additional amount charged by Uncle Sam (the tax portion), or on additional fee schemes benefiting the establishment or the municipality, such as the Healthy San Francisco tax, or OpenTable’s new $25 per person surge pricing for a prime dinner reservation. On a small meal, this could be a negligible difference; but at higher priced restaurants and for group dinners, this can really add up over the years.

 Tax on this tab, doubled, would equal 18.5%. 

Tax on this tab, doubled, would equal 18.5%. 

Tipping within reason can help you stay on budget and save for your future. One method, if you live in an area with a tax rate of between 7.5% and 9%, or higher, on dining is that you can simply double the tax. That said, if you have a favorite server in a favorite restaurant, it really is up to you!

As an independent Certified Financial Planner™, I can help you save money. Contact me and let’s get started! #talktometuesday #education #Hireaplanner #savingstip #tipping

4 Things to do During Market Pullbacks and Corrections

 Thank you,

Thank you,

Market corrections and pullbacks can be unsettling for most investors. Knowing some terminology will help you get a handle on the situation. A market correction is when there is decline of at least 10% off of the 52-week high. A pullback is a sharp drop or reversal of upward momentum and can continue for some time. You cannot control the ups and downs of the markets, but you can do a few things to alleviate the feelings of frustration and helplessness. Start by taking a breath, and if needed, call your financial planner for a chat.

First, ignore the media hype – keep in mind that it is just hype. Wild headlines about market gyrations sell stories and give talking heads something on which to opine.

Second, do nothing! That’s right, do nothing. If you have a solid financial plan and have been keeping an eye on your asset allocation, you likely need to do nothing. You and your financial planner should be monitoring your plan and asset allocation on an on-going basis. If you need reassurance, give your planner a call and talk to them about how you are feeling. Your financial planner may feel what you feel. After all, they are also involved somehow in the investment markets and their own retirement and savings are affected to some degree.

Third, check with your financial planner and see if the market downturn is a good time to buy. Chances are it is.  A correction or pullback can be a good time to add to your diversification whether you are purchasing individual stocks, mutual funds, or bonds. Do not buy a stock, bond or fund just because it dropped in price; work with your planner to make sure it fits into your overall investment plan and goals.

Finally, if you are older and approaching retirement, you and your financial planner should have already planned your liquidity position several years before your retirement. You want to make sure you have appropriate cash holdings, fixed-income and equities that match your retirement goal.

Keep in mind that time and volatility work to your advantage when it comes to long-term financial planning and investing, so stay the course! A market downturn or correction may be a great time to add to your holdings. Consider upping your 401(k) contributions, putting more money into your IRA, or even adding to funds you already hold. Conversely, a run-up in the market may be the perfect opportunity to take some profit and build on your cash position or fixed-income allocation.  Your adviser can hold your hand and walk you through these market changes and be a sounding board for your concerns. ‪A good financial planner will also remind you of your goals and timeline and why the day-to-day changes of the market shouldn’t affect your long-term planning.

As an independent Certified Financial Planner™, I can help you decide on a plan, set a timeline and put that plan into action. I can also be there to talk you through market gyrations and remind you of your goals and timeline. Contact me and let’s start planning a calmer future for you today. #talktometuesday #education #Hireaplanner #marketmadness #upsanddowns #gyrations #correction #pullback #CFPPro

529 Plans Now More Valuable for Some

As many of you are aware, the 2017 Tax Cuts and Jobs Act ushered in sweeping changes all around. Some good, some not so good. For those with 529 tax-advantaged investment accounts paying for your child’s education may now be easier.  Previously, you could only use 529 plan funds for paying qualified expenses for higher education (think university). The idea was that you saved from birth and your contributions grew tax free to pay in a tax-advantaged way for your child’s education. Some states even offer various state tax credits for contributions to 529 Plans. So, what’s changed?

 Thank you,

Thank you,

Now 529 plan owners can pay for K-through-12 private school tuition! Up to $10,000 per child, per year for each account.  This is a big change. For one, it is not the best use of plan funds for those struggling to save for college. If their child is in private school and plan owners dip into recently contributed funds for current tuition, the funds do not have time to grow. However, if a 529 plan owner is wealthier, and the state in which you live offers a tax credit, you can now fund the 529 plan, get the state tax credit, and pay for private school tuition.

Each 529 plan owner’s individual situation will determine if the change is good.  Overall, if you have the financial ability and live in a state with a tax credit, this could be beneficial. If you don’t, and you dip into funds early for K-through-12 tuition, this could reduce your available funds to pay for college.

Working with a Certified Financial Planner™ you can target specific school options and calculate the future anticipated tuition of a specific private school or state school and craft a plan to meet your funding goal be it for current tuition or for university. As parents, you have the choice of funding a percentage of the education bill or asking your child to work and pay for part of their own education. Factoring in grants, scholarships, awards, and loans is also part of the equation. The key is to get help early on, have a plan and let time work to your advantage. One thing you do not want to do, is fund education without funding your own retirement first. Retirement should take precedence. Remember, your child can borrow for school if needed; you can’t borrow to fund your retirement.

Let’s do this! As an independent Certified Financial Planner™, I can help you plan your child’s education tailored to your goal, timeline and resources. Contact me and let’s get started! #talktometuesday #education #Hireaplanner #529 #529plan #collegedream

Tax Season Comes Every Year: Tips to Help You!

Tax preparation and filing is a way of life for most Americans.  And, many Americans dread tax season.  It doesn’t have to be so overwhelming.

 Thank you,

Thank you,

Are you a simple, DIY filer? If so, your return may not be that challenging and you may be able to use software that will walk you through the interview and file your return. However, don’t become complacent and miss deductions and credits you may be entitled to claim. Each year, assess any major life changes, cash infusions, or expenses you had and confirm whether this could affect your tax filing.

Is your situation a bit more complicated? Do you have investments, real estate, a small business or did you marry, divorce or suffer the loss of a spouse? If any of these apply to you, hiring a professional tax preparer could be your best approach. If you do hire a pro, make sure they are highly-skilled and if possible, have the Enrolled Agent (EA) designation or another advanced designation in taxation. 

Not sure which type of filer you are, or should be? Well, get help! As a CFP®, I can help you assess your tax situation and decide which may be best for you. 

If you dread annual tax prep this time of year, then start now preparing for next year’s filing season. Take these actions:

- Create a small binder or folder specifically for tax documents.

- Add items you use every year such as your W-2, 1099 forms, 1095 forms, real estate taxes paid, etc.

- Identify all categories (i.e., charity donations, unreimbursed business expenses, etc.) and subtotal these before you begin your tax form.

- If you use a professional, they will likely send you a tax organizer. Work on this periodically and not all at one time.

- Start early! Don’t wait until the week of April 15 when taxes are traditionally due. For one, all the best preparers are booked! It will also make tax prep more stressful and that is the last thing you need.

Tax preparation doesn’t have to be stressful. As an independent Certified Financial Planner™, I can help you plan for the current tax year and be on top of filing next year.  Contact me and let’s get started! #talktometuesday #education #Hireaplanner #tax #taxfiling #stressfree #hireapro #CFPPro #enrolledagent

Are You Slipping on Your Goals for 2018?

Are those New Year’s resolutions already slipping away from you? Don’t worry, you can always get back on track.



The financial goals you set for yourself for the new year do not have to feel overwhelming. If getting your financial house in order seems too challenging, pick one goal at a time and make minor, but progressive and positive changes. For example, I recently posted on Facebook about how to start saving a $1,000 cash reserve for those who have nothing in savings. Saving that first $1,000 starts with just $1 – very easy! (Message me if you would like the weekly savings chart.) Whether you are starting this year with the $1,000 challenge or have bigger goals such as paying off Christmas debt, a car loan, buying a home or saving more for investments, NOW is always a great time to start. Here are a few tips for reaching your goal successfully.

First, write it down and make it real. If it’s a target-date goal, write it in your daytimer, add it to your Smartphone calendar and set periodic reminders (weekly, monthly, quarterly) to take action.

Second, break your goal into smaller, achievable pieces. For example, if you need to pay off a debt, break it down by week and month to see how much money you need to pay each period to reach your goal and how long it will take. Go back to step one, write this amount in your calendar.

Third, build your own mile markers. Calculate to see when you will reach a specific point in your goal, and (you got it) write it down! Put the date in your calendar so you can see your progress. If you have saved $250 of your $1,000 goal or paid off $500 of a $2,500 debt, record the progress on your own personal timeline.



Fourth, be flexible and don’t beat yourself up if you miss a goal target. Just assess why you missed the goal and what you need to change and get started again. Failing to make a weekly contribution is something you can rectify. But you can never recover the lost time spent agonizing over missing that contribution. Just pick yourself up, recommit, and keep going.

Finally, hire a pro! If you need guidance, hire a CFP® professional to help you. We get professional help in most areas of our life so why not hire a professional to help you with your finances! Just as we hire doctors, dentists, auto mechanics, and real estate agents, we should seek out professional help for our financial lives. Finally, don’t forget to celebrate your victories along the way. As an independent CERTIFIED FINANCIAL PLANNER™, I can help you. Contact me and let’s get started. #talktometuesday #getstarted #newyear #goals #newyou #future


Key Tax Cuts and Jobs Act Updates for 2018

While folks are still digesting the effects of the 2017 Tax Cuts and Jobs Act (TCJA), there are a few key updates you should know about for 2018. You should note that there will be many more updates announced over time as we learn more about the application of the TCJA. For now, keep the following few in mind.

 Thank you,

Thank you,

401(k), 403(b), 457, and SARSEP elective deferrals have increased for 2018.  You can now defer up to $18,500, if eligible. This is a $500 increase over 2017. However, the catch-up contribution for those age 50 and over remains the same at $6,000.  So, if you are age 50 or over, your maximum contribution total is $24,500.

For Roth IRA or IRA participants, the contribution limits remain unchanged. You can still contribute $5,500 to your IRA or Roth IRA, and for those age 50 and over the catch-up contribution remains $1,000. Remember, even though it’s possible to contribute simultaneously to a Roth IRA and a traditional IRA, if eligible, you can only contribute a combined total of $5,500, or $6,500, if you are over age 50.

Do you have a dependent child under age 17? If so, you’re in luck! The Child Tax Credit (CTC) is doubled from $1,000 to $2,000. Better yet, if you are married the CTC doesn’t begin to phaseout until your income is $400,000 ($200,000 for single filers). The first $1,400 of the CTC is refundable.

529 Plans also get an upgrade. Previously, 529 accounts could only be used to pay for post-secondary qualified education expenses to avoid the 10% penalty. Now, 529 accounts can be used for K-thru-12 education and homeschooling expenses, up to $10,000.

The Social Security wage base has been increased. The current wage base for 2018 is now $128,400. That’s a $1,200 increase over 2017. It should also be noted that the Social Security cost-of-living adjustment for 2018 is 2%.

If you are not sure how these changes will impact your finances, talk to a qualified tax advisor. If you would like to work on incorporating these changes into your financial life, contact me. As an independent Certified Financial Planner™, I can help you plan for 2018.  Contact me and let’s get started. #talktometuesday #education #Hireaplanner #tax #taxfiling #stressfree #newyear #savings #taxchanges #2017TCJA #taxcuts #taxcutsjobsact #529plan #IRA #RothIRA #socialsecurity

New Year, New You! Three Ways to Improve Wealth and Health

 Photo credit: 

Photo credit: 

Happy New Year! Yes, it’s only a date on the calendar but it is a great way to refresh, renew and revitalize your personal life and your financial life. We can use this holiday to not only mark the changing of the year, but to mark a starting point for changes to our personal lives. Most people pick a resolution related to physical fitness or financial fitness. Why not do both?

This is week one of the new year and you can get started on some financial fitness by challenging yourself to save $1,000 by year-end. You only need to save $1 to get started! If you need to save in envelopes, a jar, a sewing box, a tackle box or even a new savings account for yourself, do what works for you. You can also aim for a higher amount whether it’s $2,000 or $5,000 or $10,000 and adjust your weekly amount accordingly. Look for another post soon about reaching a savings goal.

With the new Tax Cuts and Jobs Act, it’s a good idea to look at your individual tax situation. Popular items such as state and local tax deductions, mortgage interest, and even education savings offerings have changed or been eliminated. Take some time to review these changes and how they affect you.  

Combine wealth and health by adding some physical exercise to the mix. You need not go overboard or set a drastic, hard-to-reach goal, but do set a goal. Challenge yourself to start with something easy like taking the stairs more often, parking farther away from the entrance of stores, shops and buildings, pick one or two days per week and add a health walk to your day. If you’re lonely or bored, consider inviting a friend. You can improve your health and your friendship at the same time. Walking or riding a bicycle to a destination can save your money and improve your health. Improved health can lead to lower healthcare costs so it is a win-win. 

As an independent Certified Financial Planner™, I can help you plan for the new year and be on top of your goals.  Contact me and let’s get started on a savings plan or a walk! #talktometuesday #education #Hireaplanner #tax #taxfiling #stressfree #newyear #savings

Last-minute Tips to Reduce Taxes for 2017

After today there are only three business days left in 2017. You have very little time to sell losing investments, make charitable contributions, or finalize tax payments for the year. Here are three tips to consider if you are looking to reduce your taxes.

 Photo via 

Photo via 

As noted last week, one move you can make is to sell losing investments. Investors often cling to favored stocks for emotional reasons, not rational reasons. For example, the stock was acquired while working for a favored company or inherited from a family member.  However, if that stock is a loser, SELL IT and use the loss to offset gains. Remember, you can take up to $3,000 in losses and carryover additional losses to offset gains in following profitable years until the loss is used up.

Charitable contributions count in the year made. You still have some time to make contributions but you need to plan carefully. Checks dated and postmarked on or before December 31, and credit card transactions dated on or before December 31 count as contributions for the current year. If you are considering other methods, such as via a donor advised fund, check with your provider to see if there is still time to make the contribution and finalize the transfer.

You may wish to make additional property tax payments before December 31. If you accelerate your tax payment into the current year, you can increase your deduction. Given the changes in tax legislation, this may be a good idea depending on your total income for the year. Talk to your tax consultant about your specific situation but do it fast!

Time is running out for many tax planning techniques to reduce your 2017 tax bill. However, you could still employ these last-minute tips and shave off some of your tax burden. As an independent Certified Financial Planner™, I can help you plan for next year and be on top of these taxing issues.  Contact me and let’s get started! #talktometuesday #education #Hireaplanner #tax #taxfiling #stress #stressfree #endofyear #taxtips

Year-end Tax Tips to Help You Prepare for Filing

It’s that time of year to cast an eye toward…tax prep! Most of us don’t like taking care of preparations for tax filing, so do everything you can to make it easier on yourself. Here are a few ideas for you.

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Start gathering your documents. If you have a box of receipts spend some time going through them and organizing and totaling the receipts by category. You should do this prior to giving your information to your accountant. It will save them time, and you money!

Work on your tax prep a little each week and it won’t be overwhelming. Create a specific space to organize your documents and work on your filing. If you start preparing now, the April deadline won’t be so stressful.

Sell stocks or funds that have lost value by December 31 if you need a loss. You can apply this loss against gains to help reduce your overall tax burden.

Consider finalizing cash gifts to charities. Cash gifts to qualified charities are deductible in the year made.

Did you gift money to anyone? If you as an individual gifted over $14,000 to any one person you likely will not owe gift tax, but you will have to file an additional form with the IRS (Gift Tax Form 709). Each individual has a lifetime exemption of $5.49 million (2017). If you are married, you can each gift $14,000 per person for a total gift of $28,000 to any one person. If you gifted, talk to your tax preparer about any documents you may need for substantiation.

Hire a financial planner! Your financial planner may not be able to help you with a lot of tax prep for 2017 at this time of the year, but getting you in financial shape in 2018 is something a financial planner can help you with. Set some goals and get started.

As an independent Certified Financial Planner™, I can help you get organized and create a plan for a less stressful filing season.  Better yet, we can start working on your 2018 goals.  Contact me and let’s get started! #talktometuesday #education #Hireaplanner #tax #taxfiling #stress #stressfree

Three Tips to Keep Christmas Spending in Check!

Christmas spending can leave you with a financial hangover! Many people struggle with budgeting this time of year and tend to go overboard feeling the need to give to everyone. Keep your goals in mind and your cash flow in check by following Santa’s age-old advice of making a list and checking it twice.

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Don’t overspend on office gag gifts, Secret Santa and don’t feel compelled to buy gifts for everyone in your circle. Definitely heed Santa’s advice about that list!

Don’t feel pressured to give beyond your means. Generosity is a great thing and should be encouraged. However, you should know in advance to which charities you want to send a monetary donation.

Do set a spending amount in advance. The amount you plan to spend and donate this holiday season should be already accounted for in your annual budget.

Year-end giving and spending really begins in January, so December shouldn’t come as a surprise since it happens every year. Start in January saving monthly for the additional expenditures you have this time of year. Make those charity donations monthly or quarterly; after all, they need the money year around, not just in December.

Being proactive and setting aside smaller cash amounts monthly can help your budget and be a reminder to carry the good cheer of the holidays with you daily and not just at year-end. It can also keep you from having a financial hangover after the holidays.

If you need budgeting help, or a debt reduction plan, call me! As an independent Certified Financial Planner™, I can help you make decisions and layout a plan for year-end giving and holiday spending. Contact me and let’s get started! #talktometuesday #education  #Hireaplanner  #holidayspending  #income  #debt #savings #CFPPro #moneyhabits #giving #charity