Money Centered BLOG
Financial markets close several times a year in the U.S., including on several national holidays.
The Jan. 16 Martin Luther King Day holiday is one such market closure; The Center will remain open on this holiday, but will be closed for the Presidents Day markets closure on Feb. 20.
Do you ever feel like this when thinking of your portfolio? Making investments without factoring in your investment process could end up adding more clutter to your portfolio without adding any value.
As you might recall the investment process starts with Strategic Asset Allocation, which is the establishment of your mix of stock, bonds and cash (see my post from 11/4/11). Followed by layering in tactical allocation, overweighting or underweighting asset classes as the opportunity arises (see my post from 12/2/11).
Choosing the proper type of investment is vital to the continuation of your process. There are many different types of investments that may be appropriate for you. Individual company stock is usually the first that comes to mind for investors. Common stock represents direct equity ownership in a corporation. Returns can come from dividends paid or price appreciation.
One could also purchase bonds issued by many of these same companies, as well as governments or municipalities. This means the entity owes you your principal at a specified date in the future and interest in the mean time in exchange for borrowing from you. Many factors need to be considered when investing in a stock or bond and this can be overwhelming even for many investment professionals. So many investors turn to professional money management.
Professional money managers can take two basic approaches to investing. First, active management is simply an attempt to "beat" the market as measured by a particular benchmark or index. Passive management is more commonly called indexing. Indexing is an investment management approach based on investing in exactly the same securities, in the same proportions, as an index.
So if you find yourself buried in stacks of paper every month talk to your Investment Professional to de-clutter your portfolio and determine which types of investments may be appropriate for you.
Dividends are not guaranteed and must be authorized by a company’s board of directors. Bond prices and yields are subject to change based upon market conditions and availability. If bonds are sold prior to maturity, you may receive more or less than your initial investment. Holding bonds to term allows redemption at par value. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation.
On behalf of our 19 team members, Happy New Year! The headlines thus far in 2012 trumpet the rhetoric of a contentious presidential election, difficult economic issues in Europe and beyond, and a rare Detroit Lions appearance in the playoffs. As advisors, we keep the world’s events in mind, but know that your personal milestones are our first priority.
In order to assist you in accomplishing your life goals and achieving financial confidence, we have been working on a variety of initiatives for you.
Since our firm's founding in 1985 our advice, tactics and strategies have changed, but the core tenets of financial planning have remained the same: helping you with your most important goals. Whether it’s a successful retirement, providing education funding for children and grandchildren, or planning the legacy of your estate, our highest satisfaction is not the dollars and cents of a rewarding investment but your accomplishments which our financial conversations can foster.
We look forward to our work together through 2012 and beyond.
As the famous American Proverb goes, “The best things in life are free”. If you’re thinking a vacation home in Key West or a new sports car, then the Proverb might not ring true for you. However, if one of your resolutions for 2012 was to get financially healthy…I have great news for you! The annual credit report offered by the U.S. Government is FREE.
AnnualCreditReport.com is the official, and only really free credit report that each of us can access on an annual basis (any of those other “free” sites that ask you to enter a credit or debit card may not really be free; be careful to read the fine print on such offers).
Your credit score is one of the key factors in determining your qualification for loans such as mortgages and car loans. Even more than that, these days your credit score can be considered when you apply for life insurance or apply for employment! Now, more than ever, it is important to make sure that your credit report is accurate.
Here are a few simple tips for reviewing your credit report:
(1) Review the accounts listed. Since accounts will remain on your report for up to seven years after they are closed, you may have inactive accounts listed. However, if there are accounts listed that you don’t remember opening, you should contact the vendors immediately to investigate.
(2) Review account limits and balances. If your outstanding balance is more than 25% of your available credit, this could hurt your credit score. Remember that the balances and or limits appearing on your report could be up to 30 days behind.
(3) Review late payments on the accounts listed. If there are late payments listed that you believe to be incorrect, contact the creditor immediately to clear up the discrepancy. Late payments can adversely affect your credit score.
(4) Review the entire report, including former names and addresses. Make sure that any incorrect information is corrected – if your credit report was somehow associated with someone else with a less than stellar credit history, you could be getting penalized for someone else’s credit miscues. Contact the appropriate credit reporting agency to correct any errors.
Start the year off right by getting a check-up on your credit report. Visit AnnualCreditReport.com today.
My next post will provide strategies for tackling outstanding credit card debt.
For all of you that find saving money for future goals a challenge – don’t worry – its genetics! At least that’s what a recent study seems to suggest. Stephan Siegal, assistant professor at the University of Washington, Foster School of Business in Seattle, concludes that based on his research that “genetics is the single greatest determinate of an individual’s propensity to either save or spend.” Professor Siegal’s research and conclusions are sure to draw interest from the many individuals and advisors that just might think his explanation is a bit too simplistic.
In working with individuals who have accumulated the necessary wealth to meet their goals, such as financing a college education or funding a successful retirement, I have found that saving money is more than just dollars and cents. Becoming a good saver (and meeting future financial goals) requires discipline, perseverance and sound strategies such as systematic savings plans like 401k’s, 403bs, and other automatic investment plans.
So, the next time you buy the 52” HDTV instead of fully funding your 401k blame your genetic makeup! And then make sure you schedule your annual meeting with your financial planner to make sure your on track to meet your short and long-term financial goals.
Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Any opinions are those of Center for Financial Planning, Inc., and not necessarily those of RJFS or Raymond James.
Checkout our current blog posts HERE. See you there!
Yes, it’s time to turn the page on 2011 and start anew! There’s nothing like a fresh calendar to begin making plans for your envisioned future. Last week, we provided you with some of our Center best ideas for creating financial planning based resolutions. Here, we provide you with some very specific and actionable steps you can take now to get a start on improving your financial health:
So, after you promise to exercise more and eat less, get started on tackling your financial checklist!
In subsequent posts, we will elaborate on a few of these suggestions. Wishing you a prosperous New Year!
Checkout our current blog posts HERE. See you there!
Checkout our current blog posts HERE. See you there!
Michigan held out...they protected people collecting pensions for as long as possible. But the tax breaks are over, as Michigan follows suit with many other states in the nation by taxing pensions. It all begins January 1, 2012. Not all retirees with pension income are affected. However, if your pension income is subject to Michigan tax, under the new rules, you will need to withhold Michigan tax in the amount of 4.35%.
Here’s how the new law may affect you --
1. IF YOU WERE BORN BEFORE 1946
The new State of Michigan income tax doesn’t apply to your pension.
What will happen: No Michigan tax is withheld from pension payments unless you request it.
2. IF YOU WERE BORN BETWEEN 1946 AND 1952
Some of your pension income may be subject to Michigan income tax.
Once you turn 67, the subtraction allowance applies to all forms of income
What will happen: Michigan tax will be withheld from your January 2012 pension payment based on the number of exemptions you requested for your federal income tax.
TAXPAYER EXAMPLE:
Tom and Nancy Jones are a married couple. Tom was born in 1947, is retired and collects social security and a pension. Nancy was born in 1951, and is still working.
Tom’s Pension = $30,000
Tom’s Social Security = $20,000
Nancy’s wages = $40,000
Will the Jones' be subject to pension tax in this scenario?
Not under current tax law.
3. IF YOU WERE BORN AFTER 1952
Your pension will be subject to Michigan income tax until you reach age 67. After you reach age 67, if the total income of all people in your household is less than $75,000 for single filers or $150,000 for joint filers, you can subtract the following pension amounts from taxable income on your Michigan income tax forms:
What will happen: Michigan tax will be withheld from your January 2012 pension payment based on the number of exemptions you requested for your federal income tax.
As always, work with your professional advisors if you have any questions about the tax law changes and your pension income.
Note: Changes in tax laws may occur at any time and could have a substantial impact upon each person’s situation. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors with RJFS, we are not qualified to render advice on tax matters. You should discuss tax matters with the appropriate professional.
Source: www.michigan.gov
