Many new retirees assume that Social Security income is tax-free. That is not always the case. The Social Security Amendments of 1983 opened the door to taxes on some SSI, depending on the amount of income someone earns in a calendar year.

How much of your SSI is potentially taxable? As much as 85% of it, under certain conditions. Four factors determine how much of your SSI will be taxed:

• The total amount of income that you earn.
• Where it comes from.
• Your taxpayer filing status.
• Your provisional income – a MAGI calculation which you can figure out by using Worksheet 34-1 in IRS Publication 915 or the Social Security Benefits Worksheet in the instruction booklets for IRS Form 1040 and Form 1040A.

How is provisional income determined?

In simple terms, this is calculated using your AGI, minus one-half of your Social Security benefits. (Tax-free interest from investments such as muni bonds also becomes provisional income.)

How much income can you earn before your SSI is taxed? The 2011 limits are pretty straightforward:

• Single person: up to 50% of your SSI can be taxed if your provisional income is greater than $25,000, and up to 85% of your SSI can be taxed if your provisional income exceeds $34,000.
• Married/head of household: up to 50% of your SSI can be taxed if your provisional income is greater than $32,000, and up to 85% of your SSI can be taxed if your provisional income exceeds $44,000.

Who doesn’t have to worry about this? If your only source of income is Social Security or equivalent retirement railroad benefits, it is unlikely that your SSI will be taxed and you may not even need to file a federal return. In 2011, Social Security benefits are tax-exempt for single taxpayers with provisional incomes under $25,000 and married/head of household taxpayers with provisional incomes under $32,000.

What can be done to reduce (or avoid) the tax? If you are close to hitting either the 50% or 85% tax levels, you may want to think twice about moves that could take your provisional income over the threshold – for example, receiving a sizable chunk of profit from selling a stock, or converting a traditional IRA to a Roth IRA. Here are some common moves people make with the input of a qualified tax or financial professional:

• Delaying some investment income, rental income or pension income until the following tax year
• Shifting assets from accounts or investments producing reportable income (like CDs) into tax-deferred alternatives
• Working less
• Ramping up pre-tax contributions to an IRA, 401(k) or 403(b)
• Lowering interest income (such as income from CDs)
• Lowering tax-exempt interest income (from muni bonds, federal tax refunds, veteran’s benefits, gifts and other sources).

The Bottom Line

Before April rolls around, it might be wise to consider the different ways to manage taxes on your Social Security benefits. Some new SSI recipients may be taken aback by the tax they end up paying; alternatively, you can plan to reduce it.

Things you can do before and for the New Year.  Your list may be long, but get started today!

The end of the year is a good time to review your personal finances. What are your financial, business or life priorities for 2012? Try to specify the goals you want to accomplish. Think about the consistent investing, saving or budgeting methods you could use to realize them. Also, consider these year-end moves.

Think about adjusting or timing your income and tax deductions. If you earn a lot of money and have the option of postponing a portion of the taxable income you will make in 2011 until 2012, this decision can bring you some tax savings. You might also consider accelerating payment of deductible expenses if you are close to the line on itemized deductions – another way to potentially save some bucks.

Think about putting more in your 401(k) or 403(b). The IRS hasn’t announced the contribution limit for 2012 yet. Given the moderate inflation of late, we might see the annual limit rise to $17,000 from the present $16,500, or not. In 2011, you can contribute up to $16,500 per year to these accounts with a $5,500 catch-up contribution also allowed if you are age 50 or older. Has your 2011 contribution reached the annual limit? There is still time to put more into your employer-sponsored retirement plan.

Can you max out your IRA contribution at the start of 2012? If you can do it, do it early – the sooner you make your contribution, the more interest those assets will earn. (If you haven’t yet made your 2011 IRA contribution, you can still do so through April 17, 2012.)

We don’t yet know if the 2012 contribution limits on traditional and Roth IRAs will rise from 2011 levels. If the IRS leaves limits where they are now, you will be able to contribute up to $5,000 to your IRA next year if you are age 49 or younger, and up to $6,000 if you are age 50 and older.

Should you go Roth between now and the end of 2012? While you can no longer divide the income from a Roth IRA conversion across two years of federal tax returns, converting a traditional IRA into a Roth before 2013 may make sense for another reason: federal taxes might be higher in 2013. Congress extended the Bush-era tax cuts through the end of 2012; their sunset may not be delayed any further.

Some MAGI phase-out limits affect Roth IRA contributions. If the phase-out limits aren’t adjusted north for 2012, phase-outs will kick in at $169,000 for joint filers and $107,000 for single filers. Should your MAGI exceed those limits, you still have a chance to contribute to a traditional IRA in 2012 and then roll those IRA assets over into a Roth.

Consult a tax or financial professional before you make any IRA moves. You will want see how it may affect your overall financial picture. The tax consequences of a Roth conversion can get sticky if you own multiple traditional IRAs.

If you are retired and older than 70½, don’t forget an RMD. Retirees over age 70½ must take Required Minimum Distributions from traditional IRAs and 401(k)s by December 31, 2012. Remember that the IRS penalty for failing to take an RMD equals 50% of the RMD amount.

If you have turned or will turn 70½ in 2011, you can postpone your first IRA RMD until April 1, 2012. The downside of that is that you will have to take two IRA RMDs next year, both taxable events – you will have to make your 2011 tax year withdrawal by April 1, 2012 and your 2012 tax year withdrawal by December 31, 2012.

Plan your RMDs wisely. If you do so, you may end up limiting or avoiding possible taxes on your Social Security income. Some Social Security recipients don’t know about the “provisional income” rule – if your modified AGI plus 50% of your Social Security benefits surpasses a certain level, then a portion of your Social Security benefits become taxable. For tax year 2011, Social Security benefits start to be taxed at provisional income levels of $32,000 for joint filers and $25,000 for single filers.

Consider the tax impact of any 2011 transactions. Did you sell any real property this year – or do you plan to before the year ends? Did you start a business? Are you thinking about exercising a stock option? Could any large commissions or bonuses come your way before the end of the year? Did you sell an investment that was held outside of a tax-deferred account? Any of these moves might have a big impact on your taxes.

You may wish to make a charitable gift before New Year’s Day. Make a charitable contribution this year and you can claim the deduction on your 2011 return.

You could make December the “13th month”. Can you make a January mortgage payment in December, or make a lump sum payment on your mortgage balance? If you have a fixed-rate mortgage, a lump sum payment can reduce the home loan amount and the total interest paid on the loan by that much more. In a sense, paying down a debt is almost like getting a risk-free return.

Are you marrying next year, or do you know someone who is? The top of 2012 is a good time to review (and possibly change) beneficiaries to your 401(k) or 403(b) account, your IRA, your insurance policy and other assets. You may want to change beneficiaries in your will. It is also wise to take a look at your insurance coverage. If your last name is changing, you will need a new Social Security card. Lastly, assess your debts and the merits of your existing financial plans.

Are you returning from active duty? If so, go ahead and check the status of your credit, and the state of any tax and legal proceedings that might have been preempted by your orders. Review the status of your employee health insurance, and revoke any power of attorney you may have granted to another person.

Don’t delay – get it done. Talk with a qualified financial or tax professional today, so you can focus on being healthy and wealthy in the New Year.  Give us a call today at 866-594-9919 if we can help you plan!

A recent survey found that over 60% of women feel they are better at handling money than men are. However, married women sometimes find themselves in perplexing financial situations – conditions that might be avoided with a little planning and/or foresight. With vigilance, you can plan to steer clear of these 7 mistakes.

1. Not saving enough for retirement after marriage

If your spouse earns a huge salary and has invested avidly, you may have less impetus to save for retirement yourself. Your IRA, 401(k) or 403(b) may start to seem more supplemental than primary. Yet what happens if the relationship ends someday and you personally end up with a retirement savings shortfall? Keep contributing to your own retirement accounts.

2. Dipping into retirement savings once married

If your spouse is really wealthy or has much greater net worth than you do, your retirement nest egg may seem minor in comparison. Your spouse may tell you that with all the investments and savings that you collectively possess, you taking a loan out of your 401(k) won’t be that bad. Well, drawing down your own retirement savings could look like a very bad move 20 or 30 years from now. Who knows what changes life could have in store? Resist the temptation to siphon off your retirement savings.

3. Trusting a reckless spouse with your finances

When you love someone who is cavalier with money, look out. Beware of ceding financial control or your financial say in such a situation. If you marry someone with severe debt problems, don’t think that you will be financially immune from the effects of those problems. If your spouse is a wastrel or has a terrible credit rating, do not “hand over the keys” to the household finances. Watch what goes on with the bank accounts, investment accounts and credit cards among you– keep communication open and encourage transparency.

4. Forfeiting some or all of your financial identity

You may have taken your spouse’s name, but that does not mean you need to give up your own credit card for a shared one, merge your personal checking account into a joint one, and so forth. If you don’t use a credit card for several months or years, you won’t have to pay a fee but it could show up as “inactive” on your credit report. The credit card issuer may move to close the account, and losing the credit history of that card could hurt your credit score. Retain individual savings and investment accounts and individual credit cards.

5. Divorcing with an “equal” rather than equitable financial settlement

If a divorce happens, the impulse may be to amicably split things “50/50” … or, the focus may be on keeping custody of your kids or keeping your home with your financial potential a distant second. However, you must keep your financial future in mind.

Quite often, a woman will be instrumental in building a business or professional practice with her spouse – but she may not be a part of that successful company or professional entity after a divorce. If you divorce and have helped your spouse build a business to greater or lesser degree, you may not only find yourself out of work but taking a job that pays less or having to learn new skills to compete in the job market. Your earnings potential and retirement savings potential may be affected. If you should divorce, seek an equitable settlement that considers your future financial potential; this is even more important than retaining material wealth or real property from the marriage.

6. Losing touch with your career path

If you have happily put a career aside to raise kids, keep in mind that you might find yourself returning to work sooner rather than later. Life events, economic necessity, personal desire and growing children may all be factors. Yet a long, total absence from the workplace can make it difficult to step back in – the technology or outlook of any given field can change radically across a few short years. Try to keep a foot (or at least a toe) in your career via consulting or networking efforts.

7.  Not knowing where your accounts are held

I have met way too many widows who not only did not know where their investment accounts were held, they also were unsure how much if any life insurance was available.   Try to keep a summary document of where all of your accounts are held along with phone numbers. List out life insurance policies, where wills and other estate documents are held, and have a plan in place in the event your spouse goes before you do.

The takeaway: You can plan your financial life together, but make sure you have a plan in place to account for these 7 common mistakes.  A little planning can go a long way!   Please call us at 866-594-9919 if we can help you plan!

Help! Where do we go from here?

There is definitely a lot of bad news coming down the pike.  From the United States’ massive fiscal problemsto potential defaults in Europe to the massive inflation and economic slowdown in red hot China.  If you also consider the Japanese global supply restraints and the Middle East oil crisis, there really is a perfect financial storm brewing.  Will it be a tropical storm or a category 5 hurricane?  That is the question.

Bad times don’t have to beat you down.  We serve a mighty God who can steer us through the storms. This doesn’t mean we will be bulletproof, but it does mean we can place our trust in Him rather than monetary instruments.  This shouldn’t be an excuse for complacency and “sticking the mighty head in the sand”.  Instead, it is a time to put our faith into action.  We should seek to do all we can to proactively protect the wealth entrusted to us and leave it to God for the results.

Plan ahead

He wants us to plan ahead for good times and bad.  In our desire to multiply all the Lord has provided, this means we should be taking the extra steps to be wiser stewards in how we:

* Earn income

* Give generously

* Spend money

* Invest a surplus

By bringing our faith to the front and center, seeking wise counsel, and taking action, we have a better shot at producing positive results even while the world is falling apart.  Have you noticed that there are two economies?  The world’s and God’s?  Where do you place your trust?

Most of us will be quick to respond “of course we choose God!” Yet, is this the way we live? If it is, why do so many Christ followers worry and fight so much about money?  Why do most Believers not handle their money any differently than non-believers?

It all starts with your attitude

Many Christians are still stuck in the rut that money is the root of all evil.  They look negatively at wealth and cite passages like:

Again I tell you, it is easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of God. – Matthew 19:24

READ MORE

I have been advising and counseling others on how to build true wealth for the past fifteen years. I have seen my personal share of ups and downs and witnessed thousands of others. The 2008-2009 financial crises was sure a wake-up call for many investors as they watched the financial system they trusted for their future collapse in a few short months.

It got me thinking about how many people, Christians included, built and continue to build their financial houses on sand.  I am reminded ofMatthew 7:24-26:

“Therefore everyone who hears these words of mine and puts them into practice is like a wise man who built his house on the rock. The rain came down, the streams rose, and the winds blew and beat against that house; yet it did not fall, because it had its foundation on the rock. But everyone who hears these words of mine and does not put them into practice is like a foolish man who built his house on sand.”

Five steps to help you build a solid foundation

Early this year I set out on a journey to see who thrived in 2009 and who barely survived.  I conducted nearly 600 interviews to determine if there was a solid difference between those who did well in difficult times and those who fell apart.  The numbers were alarming!  Only 5% thrived and moved forward financially during the difficult times in 2009 while 95% of those I interviewed took major setbacks and fell deeper into debt or lost major ground.

Of the 5% who thrived, there were some major common threads:

1)      They identified what they valued most in life. They had spent time finding what they loved to do and how to get paid generously for it.

2)      They discovered their meaningful purpose in life. They concentrated on using their key strengths and abilities to add value to the world and bless others.

3)      They designed their compelling vision for their future. Most had three, five, and ten year goals almost memorized!  They knew where they were heading and had a good idea on how they were going to get there.

4)      They had a real personal mission statement. Though many of them did not call it a “mission statement”, they lived their life like they were on a mission.  Their financial and business lives had clarity and purpose; they created a sense of urgency, and were persistent in their attempts to succeed.   If your personal goals and dreams have deep meaning to you then you are far more likely to succeed financially.

5)      They not only set goals, they created an action plan. This helped them implement their mission, live their values, and work toward achieving their vision.  They hired a good team of advisors and had great council and accountability to set their paths straight.

Because of my key learning and my desire to help others see how they can thrive and not just survive, I wrote a new EBook called “Thrive in Your Life – Creating the life you were meant to live”.  It describes the Five to Thrive Principles I uncovered as I interviewed those who were succeeding financially.

Thrive Principle One:  Become a passionate income earner

Of those who become wealthy, very few become wealthy from the stock market itself.  By far, the number one way to becoming wealthy is through finding a way to get paid doing something you absolutely love.

Thrive Principle Two: Become a generous giver

Many fail to give back to our society because they insist they have the lack of two precious resources – time and money.  However, those who are most successful often give more than 10% of their income away and spend countless hours volunteering and sharing their time and talents to bless others.

Thrive Principle Three:  Become a wise investor

Investing does not just mean haphazardly investing in a mutual fund.  Most investors hand over their hard earned dollars to let someone else handle their investments.  This can often be the worst thing you can do.  Those who are successful invest rather than gamble.  Warren Buffet, for example, does not invest a dime in anything unless he is quite certain it will go up in value.  That is investing.   Gambling, on the other hand, is committing money to a stock, a mutual fund, or something else without a clue as to whether it will go up or down.  Too many people gamble rather than invest.

Thrive Principle Four:  Become a cautious debtor

If 2008-2009 didn’t teach us anything, debt can be a hue deterrent from gaining wealth.  There are good, bad, and ugly uses of debt.  Far too many American use debt foolishly and it keeps them enslaved rather than reaching the desired destination – financial freedom!

Thrive Principle Five:  become a prudent spender

Those who succeed financially evaluate each spending decision from a variety of angles.  They look at price, value, durability, and how it lines up with their life purpose.  Just because you have more money doesn’t mean you can or should spend more, especially if your spending doesn’t line up with you life’s values.  Those who are successful, despite having wealth, still carefully analyze.  Want to the results of being wealthy and missing this principle?  How many lottery winners, sports stars, actors and actresses, and other celebrities go bankrupt after earning millions of dollars?

Yes, you can make 2011 the year you alter your financial life for a better financial future. Let’s look at some steps you might think of taking with the goal of financial freedom in mind.

No, we’re not talking about those ridiculously obvious steps the usual articles recommend, like “write your goals down” and “set a budget”. Let’s go past the clichés and get into the real issues.

Look at your income source, your expenses and your debt.

How do you earn income? If you earn it from one source, is there effectively a ceiling on it, or is there real potential for your income to rise in the next few years? Now look at your core living expenses, the ones you can’t avoid (such as a mortgage payment, car payment, etc.). Can any core expenses be reduced? Investing aside, you position yourself to gain ground financially when income rises, debt diminishes and expenses stay (relatively) the same.

Maybe you should pay your debt first, maybe not. If you are a business owner or a professional, for example, you’ll likely always have some debt. Your ultimate goal should be to build wealth – and you can plan to build wealth and minimize debt at the same time.

Some debt is “good” debt. A debt is “good” if it brings you income. If you buy a rental property, you’re paying a mortgage, but that’s considered a “good” debt because you’re getting passive income from the rent payments. Credit cards are “bad” debts.

If you’ll be carrying a debt for a while, put it to a test. Weigh the interest rate on that specific debt against your potential income growth rate and your potential investment returns over the term of the debt. If the interest rate on that debt looks like it will outpace your income growth and investment returns, then you should really think about paying that debt down fast, because you can’t afford that interest rate.

Of course, paying off your debts, paying down balances and restricting new debts all works toward improving your FICO score, another tool you can use in pursuit of financial freedom (we’re talking “good” debts).

Implement or refine an investment strategy.

You can’t refrain from investing, even when the bears are out. You’re not going to retire on the relatively small elective deferrals from your paycheck; you’re going retire on the interest that those accumulated assets earn over time, plus the power of compounding. Investing can also potentially bring you passive income. Consistent investing, this year and in years to come, has the potential to help you improve your financial life.

Manage the money you make on your way to financial freedom.

It’s amusing: all these Internet gurus tell you they have a method to make you “financially free” or “debt free”, but few tell you how to manage the money you make. Their not-so-subtle message seems to be “succeed and live lavishly” – if you make it financially, you’ve earned the freedom to blow it all on cars, boats and luxuries.

This is a classic nouveau riche mistake. If you simply accumulate unmanaged assets, you have money just sitting there open to risk – inflation risk, market risk, even legal risks. Don’t forget taxes – while not technically a “risk”, they are a threat to your money. The greater your wealth, the more long-range potential you have to accomplish some profound things – provided your wealth is directed.

If you want to build more wealth this year or in the near future, don’t neglect the risk management strategy that could be instrumental in helping you retain it. Your after-tax return matters even more than your investment return, so risk management should be part of your overall financial picture.

Request professional guidance for the wealth you are growing.

A good financial advisor will really help to educate you about the principles of wealth building. You can draw on that professional knowledge and guidance this year – and for years to come.

Want strategies and action plan for 2011?  Join our VIP Program. Get coaching, training, and resources to take your finances to the next level!

Analyzing the Ten Key Areas of  Your Faith-Based Financial Plan

1: Ownership. God Owns 100% of everything. This i the foundation of any plan determining who is the owner of all that is entrusted to you.

Key Verses:

Haggai 2:8 “The silver is mine and the gold is mine,” declares the Lord.

Psalm 24:1 “The earth is the Lord’s, and everything in it, the world and all who live in it.”

Key Coaching Areas:

• Assess attitudes & motives in your personal financial planning.

• Rather than, “How do I protect/use my money?” the question becomes, “How can I best look after/use God’s money?”

• To rely on God and his provision not on our wealth or our ability to create wealth.

2: Integrity.  Business, Personal, and Financial Life Coaching. I find many people who do not have passion in their lives.  They lack the motivation and drive to succeed because their dreams and goals may be out of alignment.

Key Verses:

Colossians 3:22-24 “Slaves obey your earthly masters in everything; and do it not only when their eye is on you and to win their favor, but with sincerity of heart and reverence for the Lord”

1 Timothy 6:20 “Timothy, guard what has been entrusted to your care.”

Key Coaching Areas:

In Personal life:

• Tax minimizing is fine – response to “cash” deal?

• Responsibilities as a Christ-Follower

• How do you grow spiritually?

In Business life:

• Responsible employer – what are your measures of success?

• Honorable accounting & management practices.

• Fair treatment of employees.

In Financial Life:

• Parable of the Talents:  how do you maximize all God entrusts to you?

• Moral & Ethical investments?

3: Generosity: How do you get more so you can give more? As Christ followers, we should be known for what we stand for.  How can we be more generous and help more of God’s people?

Key Verses:

Leviticus 27:30 “A tithe (10%) of everything from the land whether grain from the soil or fruit from the trees belongs to the Lord; it is holy to the Lord.”

2 Corinthians 9:7 “Each man should give what he has decided to give, not reluctantly or under compulsion, for God loves a cheerful giver.”

Key Coaching Areas:

• What should I give? To whom should I give? When should I give?

• Planning the budget after deciding on giving not before. Give first, then decide on other  spending.

• Giving without guilt, generously and with grace.

4: Planning:  Creating your roadmap – where are you heading? Without a plan, it is nearly impossible to reach your desired destination.

Key Verses:

Proverbs 6:6&8 – “Go to the ant you sluggard; consider its ways and be wise! .. it stores its provisions in summer and gathers its food at harvest.”

Proverbs 21:20 – “In the house of the wise are stores of choice food and oil, but a foolish man devours all he has.”

Luke 14:28-30 – Building a tower.

Key Coaching Areas:

• Knowing what God has called you to do with your life and your money. Do your current practices help or hinder?

• Setting goals for (e.g.):

* Giving

* Budgeting/spending plan

* Paying off debt

* Saving, financial independence

* Providing for dependents

* Funding your calling

5: Budgeting:  Getting your money to work for you instead of you working for your money. No matter how little or how much you make, without a spending plan, you could spend more than you make.  This is one of the biggest financial mistakes.

Key Verses:

Proverbs 25:28 “Like a city whose walls are broken down is a man who lacks self control.”

1 Timothy 6:6-8 “But godliness with contentment is great gain…But if we have food and clothing we will be content with that. People who want to get rich fall into temptation and a trap…”

Key Coaching Areas:

• Know how much (a) income there is. Know how much (b) spending there is. Keep (b) less than (a).

• Run a spending plan – think future not past, “What shall I spend my money on next  week/month/year?”

• Avoid a consumptive lifestyle, living beyond your means.

• Avoid the compulsion to spend, spend, spend; keeping up with the Jones’.

6: Borrowing: Getting and staying out of debt. This focuses on being a cautious debtor and only using debt as a last resort.

Key Verses:

Proverbs 22:7 “The rich rule over the poor, and the borrower is servant to the lender”

Romans 13:8 “Let no debt remain outstanding.”

Key Coaching Areas:

• Poor budgeting & spending more than you earn leads to debt.

• Debt restricts flexibility and choice.

• Debt presumes upon and mortgages the future.

• How much should we borrow and for how long?

7: Saving for a rainy day: Creating and maintaining emergency funds and funding your future. Those who save and have emergency funds are better prepared for difficult times.  The past few years have shown us the importance of having a proper savings strategy.

Key Verses:

Proverbs 28:19 “He who works his land will have abundant food, but the one who chases fantasies will have his fill of poverty.”

Proverbs 21:20 “… a foolish man devours all he has.”

Key Coaching Areas:

• Save to build an emergency fund (equivalent of 3 months of income).

• Save for major purchases to avoid debt (water heater, automobile repairs, home entertainment system, vacation, etc.).

• Save for future needs and giving (missionaries, charitable gifts, friends in need, etc.).

• Save for retirement.

8: Investing with a Purpose: Using your Blessings to Bless Others. Many invest without a purpose – just to accumulate. Additionally many invest in companies that are far removed from their faith and values. Let’s look at what values are important to you and create an investment plan around those values.

Key Verses:

Proverbs 13:11 – Dishonest money dwindles away, but he who gathers money little by little  makes it grow.

Ecclesiastes 11:2 “Give portions to seven, yes to eight, for you do not know what disaster may come upon the land.”

Key Coaching Areas:

• Get rich slow/don’t try to get rich quick – risk?

• Don’t hoard but invest for a purpose.

• Invest with the/an end in mind & work out a realistic target.

• Faith-based investing – choosing your investments

• Asset allocation and diversification

9:  Protecting All God Places in Your Care:  Prudent Strategies. Having proper insurance plans in place are critical.  This includes health, life, disability, long-term care, and property insurances.

Key Verses:

1 Timothy 5:8 “if anyone does not provide for his relatives, and especially for his immediate family, he has denied the faith and is worse than an unbeliever”

Ecclesiastes 5:13 “wealth lost through some misfortune so that when he has a son there is nothing left for him…”

Key Coaching Areas:

• God protects us but we should provide.

• How much insurance is wise? Can you over insure or under insure?

• Looking at proper amounts and if you should carry life, health, disability, home & auto, liability, and long-term care insurance

10: Legacy Planning – How will you be remembered? This involves setting up an estate plan – wills, trusts, health care directions, and powers of attorney.  This also includes charitable gifting strategies.

Key Verses:

Proverbs 13:22 “A good man leaves an inheritance to his children’s children, And the wealth of the sinner is stored up for the righteous.”

Proverbs 17:2 “A servant who acts wisely will rule over a son who acts shamefully, And will share in the inheritance among brothers.”

Key Coaching Areas:

• Analyzing your wills, trusts, and beneficiary designations

• Making sure you have all the proper legal documents and organizing your affairs to make it easier on your beneficiaries

• Legacy planning tools

• Getting your wishes on paper

Reason #10: “I’m too busy”
I can’t tell you how often I hear this excuse. So many people want to plan for a better retirement, but they don’t have time. They think they’ll take care of it tomorrow, or the day after that … and before they know it, several years have gone by. The best advice I can give you is to stop procrastinating and start planning today.

Reason #9:     “It’s too soon”
I don’t know how this happened, but many people have adopted the notion that you don’t have to start planning for your retirement until you’re almost there. This is totally incorrect. The truth is, the sooner you start planning, the better chance you stand of having the kind of retirement you want. It’s never too soon. Many people start planning in their early twenties!

Reason #8:    “It’s too late”
If you’re already near or past your retirement eligibility date, you may think that whatever you’ve got is what you’re stuck with and it’s too late to do anything about it. Think again. If you’re unsure of what your options are, speak to a professional. Even if you’ve already retired, it’s important to consider how you’re receiving income and how long it will last. It’s never too late to revise your income distribution strategy.

Reason #7:    “I don’t need to”
I’ve heard this excuse many times and it always baffles me. Many people think that because they’ve been diligent about contributing to a savings account, they’re all set. While saving for retirement is good, you also need a plan for income distribution once you enter retirement. Are you certain that what you’re saving will be enough? Have you considered your distribution plan? What about taxes? What about inflation? And are you sure your money will be properly invested? There may be other, better options for you and it may prove worthwhile to look into them.

Reason #6:     “I don’t have enough money to get started”
This excuse seems marginal at first glance, but there is some truth behind it. You need to have money to save or invest money. However, unless your bills are exactly equal to or greater than your net income, you DO have enough to get started. Starting small is better than not starting at all, and if you plan well, you’ll eventually have more to work with.

Reason #5:     “My finances are a mess”
This is all the more reason to seek out an advisor who can help you sort through and understand your assets. Perhaps you have a 401(k) from a former employer that has not been rolled over, a couple of savings accounts, a trust from a deceased relative, some stocks that your parents bought in your name when you were younger … a circumstance like this can be confusing, but leaving it as it is won’t improve the situation. Consider speaking with an advisor who can look at your complete financial picture, help you to understand it, and help you to develop a plan to make your “financial mess” work for you.

Reason #4:     “The Government will take care of me”
The bottom line is this … there’s a chance Social Security may not be available when you retire, and even presuming it is, it may not be enough to provide your ideal retirement income. If you’re planning to retire on Social Security alone, I would advise you to create a back-up plan at the very least.

Reason #3:     “Between my savings and my 401(k), I’ll be fine”
Saving for retirement without an income distribution plan can be a mistake. How will you use that money once you have it? And while you may think you’ll have everything you’re going to need, have you considered inflation? Taxes? And furthermore, some people are living past 90. Will your assets last that long? If you outlive your income, what then? It’s a good idea to look ahead and plan lifelong income.

Reason #2:    “I don’t want to think about it”
Many people procrastinate simply because the thought of discussing financial matters (or growing old) is unappealing. I can certainly understand that. But consider this … if you bite the bullet now and put a firm plan in motion, you may not have to think about it again for quite some time.

Reason #1:    “I don’t know how”
If you knew everything there was to know about financial planning, you’d probably be a financial advisor yourself. While it is possible to do everything on your own, that generally involves a great deal of research and a huge time commitment. If you’re putting off retirement planning because you don’t know how, consider speaking to a professional who does.

These are just some of the reasons why people don’t plan for retirement … but these are reasons, and not excuses. If you have retirement goals you want to reach, I would recommend you speak to a qualified Financial Advisor and set up an action plan. The sooner the better.

The secret to investing that most people miss is they overlook one of the most valuable assets, which is their own self! So how do you invest in yourself? The first step is taking the time to figure out what your ideal life looks like: spiritually, financially, occupationally, and otherwise. This will then allow you to create an investment, and financial plan to complement both your long-term and short-term objectives. Once you know what you really want, you are now in a much better position to create a financial blueprint by design rather than one by default. In other words, you‘ll know what you‘re doing and why. That can make all the difference in the world!

There are many different ways to invest in one’s self. A lot of people get stuck in investing ruts. They think that investing means mutual funds, or purchasing ―hot‖ stocks. But there are many legitimate traditional and nontraditional ways to invest. Different investment vehicles can be smart ways to invest, depending on where you‘re at in life, and what objectives you have. Every investment vehicle has its positives and negatives, but the point is that there is more than one way to invest, and many overlook one of the most obvious investment opportunities: Developing your own capacity to create real value in the world, in turn leads to financial prosperity. It is not so much that investment products are good or bad, it is whether they meet the objective or not. What you want is a plan that is not based on limits, but on the limitless possibilities of your own unique potential.

Invest in your own life, first!

There is more to wealth than just money. Real prosperity involves your health, your spirituality, your relationships and your overall emotional/mental wellbeing. People don‘t live compartmentalized lives.

Every aspect of life will naturally affect each other, including financially. If you want more money, realize that investing in yourself is likely to increase your wealth and happiness more than investing in someone else, or in some other company. Think about it. You‘re smart.

You have passions and ideas. Why can‘t you make a lot of money doing what you want to do? Many people do, and there’s no reason why you can’t too.

So how do you invest in yourself? One way is to identify your own natural passions, abilities, and talents, and then bringing them to the marketplace. That doesn‘t mean that you have to own your own business or be a good salesperson. Anyone can find enjoyable ways to bring value to the marketplace, which in turn naturally creates wealth.

Investing in yourself allows you to identify and obtain a view of the possibilities. People who invest in their own ideas and talents, are inevitably richer, happier and more satisfied than people who only dare invest in others talents and capacity for productivity.

KEY INSIGHT

How often do we seem to be between a rock and a hard place? We seem to be pinned against the wall. All hope is lost. You are overdrawn on the checking account, the credit cards are maxed. It is a struggle to make ends meet. Or you are about to retire and the stock market collapsed, delaying your plans for years. Any number of financial circumstances can appear to be a disaster. However, there is always light at the end of the tunnel. There is always hope in Christ. He can help you no matter where you are. You just need to let go and place your trust in Him.



The lyrics are moving:
“I wasted the rescue,
abandoned the mission.
I’ve failed by my own hand
and watched it all go wrong

You said you could save me
that I couldn’t save myself
You said that you loved me
no matter what I’ve done

When the light is gone
and life is just a day we take
Still the fight goes on
to give my heart away

And It’s out of my hands
It was from the start
In light of what you’ve done for me”

How many times do we get in the way of God’s work in our lives? We try to take control when He is in control of everything.

He can save that marriage…

He can help you get that job you need…

He can cure you from that awful disease…

He can solve your addictions

On and on…

The truth is we cannot do it alone.  Your finances included.  It takes accountability: to Him, to yourself, to your spouse, to an accountability partner.  Don’t do your finances alone!   Get the help you need…

Let me know if I can help offer you a professional opinion.

Are you heading in the right direction?

Are you off course and need some guidance?

Proverbs 19:20-21

Listen to counsel and receive instruction,
That you may be wise in your latter days.
There are many plans in a man’s heart,
Nevertheless the LORD’s counsel—that will stand.

Jeremiah 29:11
For I know the plans I have for you,’ declares the LORD, ‘plans to prosper you and not to harm you, plans to give you hope and a future.