Estate Planning

Secure 2.0 Act Changes to Federal Tax Code

It’s a new year, which means new tax code changes. Some of those changes involve the Secure 2.0 Act. Many will appeal to tax payers. There are over 100 provisions in this Act, designed to encourage participation in retirement plans. We’ll focus on some of those most likely to be relevant to you. 401(k)s Employers can provide incentives for employees to contribute to their retirement accounts as part of the Secure 2.0 Act provisions. Student loan payments will qualify as employee contributions for employer matches to retirement accounts come 2024. Studies and personal stories argue student loan debt is a barrier to wealth building. By allowing employees to count repayments on higher education costs as substitutes for retirement contribution matches on 401(k)s, younger employees can see the benefits of compound interest earlier with retirement investments. One of the Act’s provisions involves auto enrollment in employer 401(k) or 403(b) retirement […]

Plan retirement contributions now for tax savings

There are many different types of income deferral plans available. These allow business owners to put money away for income or tax deferrals. Some options even pay both you and your employees. When you invest in your employees’ financial security you build good will too. Plan ahead for retirement contributions for tax savings to work for you. It’s important to get a strategy in place now for benefits with next year’s tax returns. The right plan for you depends on your income and situation. Consider the following: SEPs offer tax deductions for contributions Self-employed individuals and employers can set up a simplified employee pension (SEP) IRA plan. This allows the employer to take a tax deduction for contributions made to each eligible employee’s account. This includes the owner. To get tax benefits you need to set up a traditional IRA to to deposit SEP monies into. This can be as much […]

Don’t forget real estate in your net worth

Wealth is defined as an abundance of valuable possessions or money. How much wealth you have is determined by subtracting liabilities from assets. This is also how you calculate your net worth. Have you thought about what that number is lately? It’s probably different than it was before COVID-19 came on the scene. The time we’ve spent in isolation during 2020 has caused most to do a lot of self-reflection. Too much for many of us to be comfortable with. Still, it’s always a good idea to periodically assess where you’re at and where you’re going. Why not spend some of this navel-gazing time doing and in-depth evaluation of your finances? You might be pleasantly surprised at what you discover. Get creative to build wealth I often find, when working with families and business owners to assess their net worth, that real estate is a significant portion of their wealth. Most, though, […]

Making your home a better asset

There’s been a big uptick in purchases at home improvement stores. Stocks are rising and revenues climbing at some of these retailers during a time most other businesses are struggling. It’s no wonder. People are spending more time at home, looking for something to do, and fixating on home issues. According to Baron’s, “. . . home improvement spending rallied 16.4% year over year in May, with the adjusted figure coming in up 5.2% for the three months ending in April.” Home Depot and Lowe’s “comparable sales climbed 6.4% and 11.2%, respectively during this time.” Yes, as we’ve been hunkering down, we’ve been tinkering with our living spaces. Retirement planning with real estate Typically, people think about 401ks and other traditional retirement savings vehicles when they calculate assets. As you plan your investment strategies and review your net worth, don’t forget to include real estate. What’s also important to consider, […]

7 Key Elements Of A Solid Estate Plan

If you are under the impression an estate plan is only for the very wealthy, that mistake can be costly to you and your loved ones. Or maybe you’re aware of the importance of estate planning and had your paperwork set up a few years ago. Either way, thanks to new tax laws that just went into effect, now is the time to either grab your favorite feather duster to dust off and review your docs, or start one of the most important steps you can take to make sure your final property and health care wishes are honored. Estate planning is an often-neglected part of financial planning. It’s easy to put off answering uncomfortable questions like, “What happens to my assets, belongings and loved ones when I die?” It’s not surprising that around half of Americans don’t have a will, and even fewer have an estate plan. You’re not […]