December 5th, 2007
Richard A. Bennett, CFSC, CFP®, AIF®
As the old saying goes, “there are only two things certain in life - death and taxes.” With the end of the year fast approaching, it is time to make plans for both.
There is still time to execute your 2007 tax savings strategies. These strategies may include selling investments that have declined in value, making last minute charitable gifts to your favorite charity, determining if you have fully funded your individual retirement account or qualified retirement plans, and prepaying some of your deductible expenses. Following through with these items may help reduce or allow you to defer the tax bite on April 15th.
This is also the time of year when most of us are asked to make an election to participate in our company’s 401(k) plan. Making the decision to defer a portion of your 2008 compensation into the plan can reduce your 2008 tax obligation and provide an investment vehicle where earnings are sheltered from income tax until you reach retirement. In addition, many plans also offer a company matching contribution. These contributions are provided as an enticement to encourage employees to save in the company’s plan. Not taking advantage of these contributions is the equivalent of giving up a guaranteed return on your investments. If at all possible, you should elect now to participate in the company’s plan up to at least the percentage where the company match is provided.
If you are unclear about any of these tax planning issues, you should consult with your tax advisor or financial planner.
December 3rd, 2007
Thomas A. Muldowney, MSFS, ChFC, CLU, CFP®, CRC, CMP®, AIF®
There’s much ballyhoo about retirement and accumulation planning. For most of us, the best way to acquire wealth is hard work, perhaps, very hard work. It’s even better if the hard work was done by your ancestors. For those of us that were not born into the lucky genetics club, the hard work is upon our shoulders.
I recently read an article by Bob LeClair (Leimberg Information Services) who suggests that retirement is not automatic. In fact, he suggests that for a large segment of the population, their retirement plans will be postponed “…until income or assets become reconciled with a shorter life expectancy.” This is a poetic description of working longer – probably well into normal retirement years.
This does not have to be the case. The tools for retirement planning have not changed in 5,000 years and even more importantly, they have not been kept secret.
Only three tools are available to build up your nest egg: Time; Rate of Return and Money. Simply put, if you have a lot of all three of these tools, you have a pretty good shot at a comfortable retirement.
For some of you, this is your first exposé to accumulation planning and it is very simple. I call it FAME…Financial Accumulation Made Easy;
1. Save some money every single paycheck - this is the money part;
2. Start this program as soon as you get your first job (If you can’t go back to your first job…start right now.) - This is the time part;
3. Make your money work for you. - Investing provides the rate of return. In each case, “more” is better!
There is a huge difference between ‘man at work’ and ‘money at work.’ Money at work turns your dollars into a tireless miracle worker. Invested money works 24/7, your investment wealth will work for you long after you have become too tired to toil.
To gain your own FAME…start now, save a lot, and invest wisely.
Richard A. Bennett, CFSC, CFP®, AIF® 
