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Monday, October 27, 2014

Talking to Your Kids about Money

A few months ago I was driving my 10 year old daughter to an event and I mentioned something about saving money for college. She asked me why we needed to save for it and why we didn’t just pay for it when she went. After stumbling around for an answer that a 10 year would understand I said that it was very expensive and if we saved a little bit now, then we wouldn’t have a large bill when she went to school. This prompted an extended discussion about saving money for retirement, college, vacations and other things we want to do. It was a great opportunity to instill some values and build a foundation for many future discussions. Fast forward to a week ago when the kids had a lemonade stand. I came home and they had made $15! I think I made $1 when I did mine years ago. The first thing she did was count it up and put some in her piggy bank “savings” and some in her envelope to spend. I like to think that came from our little discussion in the car. I urge you to talk to your kids about money and it is never too early to start.

Wednesday, October 22, 2014

When Should I Take Social Security?

This happens to be one of the most common questions I am asked when sitting across from retirees. The answer obviously depends on a person’s specific situation, but the numbers from a recent T Rowe Price study make an interesting argument of a split strategy. This article discusses having the lower income spouse start their benefits early and having the higher earning spouse waiting until 70. Every year a retiree waits to take social security provides them with a higher income the next year up until age 70. Again every family’s retirement situation is unique, but the “when to start taking social security” question can be one of the biggest keys to properly funded glory years.

Monday, October 13, 2014

It's Harvest Season!

Last Saturday, my daughter and I went to the local farmer’s market. What a great time of year to live in Michigan. Our local farmers are harvesting sweet corn, blueberries, peaches, cherries, tomatoes and many others of the Lord’s gifts. The flavors of this time of year are outstanding and it has been a good season.

It has also been a good season for some investments. As we move into fall, we begin to think about harvesting gains and losses. In most cases, our capital gains are harvested for us by our professional investment managers. In some cases, we have more control. This could be important depending on our tax situation for the year. Also, we may have some unrealized capital losses that could be harvested to offset other capital gains.

While it is important to review taxable investment accounts for opportunities to harvest both capital gains and losses, it should be done carefully to make sure the rules are followed. Also, taxes should not be the only consideration in deciding whether or not to sell or hold a particular investment. Your financial advisor and your tax professional should both be consulted.


This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific situation with a qualified tax advisor.