Retirement Planning

Your Marginal Tax Bracket

Tax rates come in many forms. One that might apply to you and can impact your investing and your money for the future: your marginal tax rate.

In 2014, the federal tax brackets are 10%, 15%, 25%, 28%, 33%, 35% and 39.6%. If you are married and file jointly with your spouse, your first $18,150 of income after deductions and exemptions is taxed at the 10% rate. Your income between $18,150 and $73,800 is taxed at the 15% rate. The next $75,050 incurs 25% tax, and so on.

The High Price of Waiting

Procrastination is a silent and slow killer of savings. Everyone puts things off, of course, waiting until the last minute and then scurrying to finish a longstanding to-do list. Taken to extremes, this course pulverizes your long-term financial plans.

Here’s an example. Last year my wife and I debated whether to remove a tree from our back yard. Mainly in the fall this sweet gum tree dropped its fruit, sharp and pointy gumballs that worked wonders on mower blades and bare feet.

What’s Your Biz Worth?

You might know the worth of your business but odds are you don’t. Determining your business’s value can be tricky – and potentially critical to your quality of life in retirement.

Here are factors and formulas to consider.

Owner’s benefit. The easy way to figure your business’s worth uses a multiple of cash flow. Average your last three years’ owner’s benefit and multiply by a number between three and six.

Beware of Fixed-Income Risks

As you sketch out your retirement income plan, you often hear that stocks are risky and fixed-income instruments, like bonds and certificates of deposit, are safe. That simplistic formulation ignores how devastating inflation is on fixed income.

Estate Plans for Disabled Kids

Estate planning decisions are especially challenging for parents of children with special needs. The question of “Who will take care of our child after we’re gone?” can be heart-wrenching.

The crux of estate planning, for many of us, comes down to one issue: taking care of family. We do our best to make decisions that we hope will be right for surviving spouses and children. The long-term impact of those decisions is especially crucial for children with special needs.

6 Ways to Save for Retirement

If you’re like most people, you probably haven’t saved enough to retire. Especially if you’re older than 35, it’s time to get serious. So here are six steps to follow.

Some people foolishly think the future will take care of itself. If you own a business, maybe you think your business will provide ample money in your future (maybe it will, maybe it won’t). You might contribute to a retirement-savings plan at work and nurse a vague idea of how much to save. That won’t cut it.

Confident About Retirement?

Feel good about your future in retirement? If yes, you join a growing number who think their golden years will indeed be golden. Others aren’t so sure.

The Employee Benefit Research Institute (EBRI) recently published the annual Retirement Confidence Survey. A few highlights:

The End of a Useful Benefit?

President Barack Obama’s recent new budget documentation briefly mentions a desire to curtail file and suspend as an option for Social Security benefit filers. The administration views this option as one way for high-income folks to take advantage of the government. Right or wrong, this spells danger for one of your potentially valuable benefits.

Key to a Good Plan: Flexibility

Ever go to a financial planning meeting when the subject turns to financial planning software? Often planners give complicated software high grades and believe the resulting plans are precisely accurate. They aren’t; good financial planning never predicts precisely. The key to good planning is having the flexibility to change directions as needed.

Do you expect your doctor can tell you exactly when you’ll die? How can your financial planner describe your finances – and the role those finances will play in your life – 20 years down the road?

Hidden Costs of Your 401(k)

If you participate in a 401(k) plan from your employer, you’re likely one of the many who unknowingly pay to be in a company plan. Where does your money go?


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