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An important part of financial planning is determining a plan for distributing one’s estate and getting it in writing.  Without a plan in place, an estate is divided based on state law, and every state has different laws for “intestate succession”.  While succession starts with close family members, percentages and priorities are not always what you might have assumed or preferred.

Without estate documents in place, the person in charge of administering and distributing your estate would also be determined by state law, or chosen by the courts.

Most people have some preferences about how they would like their life’s work and accumulations distributed or cared for, but many have avoided facing the sobering task of putting their preferences on paper.

There are many details yet to be researched and hammered out, but taxpayers were “saved” from the fiscal cliff in the nick of time.

Points in the new tax bill that will be of most interest to our clients:

• The new 39.6% tax bracket starts at $450,000/400,000 (Married filing joint/single). People in that tax bracket will also see an increase in their qualifying dividends and capital gains rates.

• Everyone else got a “permanent” extension of the Bush-era tax cuts, and their capital gains rate remains at 15%.

• Everyone else: before you get too happy, the Alternative Minimum Tax (AMT) is subject to a flat 26% rate on income up to $175,000 and 28% thereafter.

Insurance is used in financial planning to mitigate risk, replace lost income, restore assets or leave a legacy. Because of its importance, we schedule regular reviews for our clients’ policies, and keep an ear open for changes in our clients’ lives that would warrant a change in insurance.

Dental practice owners need to have an insurance review their business interruption, office overhead, property, general and professional liability policies annually, especially when changes have occurred in size of staff, revenue, location or services;  changes that would warrant a personal insurance policy review would include marriage or divorce, change in dependents, significant change in net worth (debt / investments), change in earning potential, buying or selling a business or nearing retirement.

Christmas may be over but, for many, the process of paying for it has just begun.

The worst one-day crash in stock trading took place 25 years ago today.

At the time, Tonyia was working as a bond trader and Sharon was a stockbroker. Much was learned by living through the crash and the markets that preceded and followed.

 

A client e-mailed me about the market, worried that he needed a parachute for that day’s free-fall.

You know I love budget consciousness, so when I saw that the Social Security Administration had suspended the mailing of Social Security Statements I was a little sad, but understanding. That’s a lot of

I talked with a client who lives and practices just outside of Joplin, MO, a city recently devastated by a tornado that destroyed the main commercial drag through town and 7000 homes on either side of it.  He told me that 22 dentists lost their practices that day. I later found out that “Of 58 dentists, at approximately 40 locations, there are 23 who had total destruction of their offices and others who have damage from the storm. As well, several doctors’ homes were completely destroyed or suffered varying degrees of damage.“ (click link to find out how you can help)

My client also shared a story of a physician’s practice that was up and running in another location by the end of that first week, thanks to his Business Interruption Insurance.  Please use this story as motivation to check your coverage, usually included on your commercial property or comprehensive insurance, to see if it is sufficient to get you through a disaster.

Two articles came out at about the same time last fall, targeting different audiences, but both highlighting “5 mistakes” people make when preparing for retirement.  It was likely a coincidence, but interesting to compare the two. The article circulated through Associated Content, and picked up by numerous consumer publications, talked about how people start saving too late, underestimate the cost of not only healthcare but retirement in general, don’t diversify enough, turn a blind eye to their investments, and find too many excuses to spend their retirement BEFORE they retire.  The other article, written for Financial Planning magazine, an industry publication for financial planners, had a slightly different perspective.  The mistakes were listed as retiring with too much debt, lack of insurance (supplemental health and long-term care), ignoring inflation, relying too heavily on one income source, and not protecting savings (moving to more conservative investments as retirement nears).

Perhaps Values-Based Cash Flow Management would be a more palatable term, but money that is not spent in line with what you truly value is wasted.