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IRS Allows Tax Free Conversions of After Tax Contributions from Retirement Plans

Posted on Sep 25, 2014 in Tax

Tax Form 1040There are now new rules for taking after tax money from qualified retirement plans (such as a 401K, 403b, or 457b accounts.) If you have any after tax contributions within your plan, they can now be rolled directly into a Roth IRA upon separation from service. In the past, most people either rolled all of their funds into an IRA and paid taxes pro-rata, based on the ratio of pretax to post tax contributions, or they had the option to take a separate check for the after tax funds and roll the balance of the funds into an IRA. Now the IRS has ruled that the after tax funds can be transferred into a Roth IRA where they can grow tax free (think of this like a tax free Roth conversion). Read More

Building the Crystal Ball Portfolio

Posted on Sep 25, 2014 in Investment, Plan Retirement

video-economyClients will often review their quarterly investment statements and ask the following questions:

“I noticed that this particular fund or asset class was down.  Why should I be invested in it if it just keeps going down?”

“Large cap stocks have done so well recently, why don’t I just invest all of my money allocated to equities in large cap funds?”

The recent love affair with US large caps is understandable.  This asset class had spectacular performance in 2013, as well as the past 5 years.  However, 10 and 15 year performance lagged other asset classes.  See the chart below. Read More

When it Comes to Finances, as Rodney Dangerfield Would Say, Women Still “Don’t Get No Respect”.

Posted on Sep 16, 2014 in Women and Money

thumb_lauraFor years I have been the “CFO” of my household.   Over twenty plus years of marriage, I have paid the bills, done all of the investing, monitored the family budget  and net worth, negotiated mortgages,  and even have power of attorney for my husband, so that I can execute trades on behalf of him.  We both have charities that are near and dear to our hearts, but we normally write a check for all of our donations from our joint account.   Often, the thank you card we receive from the charity is addressed only to my husband.   Ouch! Read More

How to Get Ahead in Life

Posted on Sep 15, 2014 in Budgeting, Cash Flow, Financial Management, Financial Plan, Life Plan, Plan Retirement

man on top of mountain silouette (800x767)This month’s article in Financial Advisor magazine “Getting Ahead” by Mitch Anthony struck a chord with me as I think our society often sends the wrong message about what it means to be successful.

Americans strive to do “better than the Jones’” by earning enough money (and accumulating debt) to buy fancy McMansions, nice cars, and family vacations.  But the never-ending pursuit of the trappings of wealth can get in the way of the truly important things in life such as relationships, job satisfaction, and extracurricular pursuits.  Debt accumulation is often the end result of aspiring to acquire “stuff and things” so we can impress others and make ourselves feel like we have succeeded.   Acquiring material possessions rarely leads to happiness.  In addition to increased debt, it impairs our ability to provide adequate savings for retirement.   In fact, research shows that the average American has very little saved for retirement.  Read More

Make Time For Your Finances-Take This 10 Minute Audit

Posted on Sep 8, 2014 in Financial Management, Financial Plan, Life Plan

Insurance, investing, estate plans….aspects of your financial life can be intimidating, but that does not mean that you should delay, deny, or disregard your situation.  Instead, try to build your awareness by going through a quick audit to see if you are on track.  In this radio interview with Jim Ludwick, on the Swim with Jim radio show we discuss the importance of annual financial audits.

Check Out This Podcast on Financial Audits at Blog Talk Radio with Swim with Jim.

Here are more details on how to conduct your own 10 minute financial audit.

Is Your Physical Health Correlated to Your Financial Health?

Posted on Aug 25, 2014 in 401Ks, Behavioral Finance, Budgeting, Cash Flow, Financial Management, Financial Plan, Plan Retirement

Woman Jogging Outside

A recent study conducted by Timothy Gubler and Lamar Pierce from the Olin Business School, Washington University in St. Louis shows that poor physical health is driven by the same psychological factors that determine whether or not you contribute to your retirement plan at work.   See this related article in the NY Times:

In the study, employees who contributed regularly to their 401(k) plan were not only more likely to take steps to improve their health but also had a 27 percent improvement in their blood scores. “Non-contributors continued to suffer health declines,” the paper said. Read More