Average is not good enough … Our goal at Family Investment Center is excellence. We find excellent investment products and supervise an excellent service package. We maintain a library of excellent research materials and financial planning resources. We also demand top safety and security for our clients.
We won’t settle for average. We continually seek top managers or securities and meld them into superior custom portfolios. Each palette of investments is carefully tailored to personal or family goals. We enlist excellent managers, research, resources, and effort for our clients. Don’t settle for average. You deserve excellence.
Please search our blog posts for answers to common investment questions, and we look forward to sharing our knowledge and experience with you first-hand.
The Importance of Professional Investment Advice During Key Life Changes
Recent findings from a Merrill Lynch study found that widows get faulty Social Security information from agency representatives almost 82% of the time. Losing a partner is an emotional and stressful experience, and failing to get the right investment advice shouldn’t be a part of that.
According to a Merrill Lynch and Age Wave survey titled “Widowhood: The Loss Couples Rarely Plan For – And Shouldn’t,” half of the widows surveyed experienced a decline in income of 50% or more, and more than half said they didn’t have a plan for widowhood.
Claiming Social Security survivor benefits shouldn’t be complicated, but for many new widows it is a difficult process. In the best of situations, a widow might claim survivor benefits upon retirement, then wait until they’re 70 to claim their own benefits. It’s in a situation like this where the benefits are often maximized.
An Investment News article in early October relayed the details of the author’s friend, who made three phone calls to the Social Security Administration (SSA) and was told by representatives that she wasn’t entitled to survivor benefits because her own benefits were larger.
The reason for denying these benefits, according to the article, is that the SSA’s “deemed filing” rules require that a person born after January 1, 1954, file for benefits at the time of the claim. However, the deemed filing rule doesn’t apply to survivor benefits, which means many individuals could be living with the ramifications of incorrect information.
At Family Investment Center, we offer Social Security maximization services, and we help our clients know and understand the many Social Security options that are available. Knowing the options and how they’ll impact your future is important in every stage of life. Let’s schedule a time to talk about how our team can make sure you know all your choices.
Yes, You Can Expand Your Approach to 401(k) Investing
If your company offers a pension plan, you’re a rarity. While that was the most popular retirement planning tool for decades, not many organizations offer pension plans today. The tool that’s now in its 40th year and has taken the place of pensions is, of course, the 401(k) for investing.
401(k) investing has great benefits. For example, in 2018, your contributions are tax deductible up to $18,500. If you’re 50 or older, the IRS allows you to contribute $24,500 a year – tax deductible. Another benefit to the 401(k) investing method is that many employers will match contributions to a certain percentage (it varies, but rarely goes above 6 %).
What Are Your Options?
While the 401(k) has been around since 1978, a Roth 401(k) option was added in 2006. The traditional 401(k) investing model allowed for tax deductions upon contributing, but in retirement, those funds are taxable. The Roth model does not allow deductions on your contributions. Rather, you pay taxes up front, and then in retirement as you withdraw money, all of it – contributions and earnings - comes to you without a tax bill.
For employees in a lower tax bracket, the Roth model makes a lot of sense, because they can potentially see a big tax benefit upon retirement and are likely not depending on current tax deductions.
Another benefit of the Roth 401(k) is that there is no income limit. Plus, the traditional Roth IRA caps contributions at $5,500, or $6,500 for those 50 or older.
Getting the most you can out of your money should be a priority, but it can be difficult to do without professional guidance. That’s why it’s smart to bring a fiduciary in to guide you through all the options, and there are many more than most investors know about. More options mean more ways to get to the freedom you want, whatever that looks like.
At Family Investment Center, we’ve made it our mission to understand all the possibilities that exist for our clients. We’ll listen to you as you talk about your goals, and we can plan your route in meeting them. Contact us today and let’s discuss your options.
How Many Rules Are Too Many in Financial Planning?
In the financial industry, streamlined service matters. It matters a lot.
Providing a consistent, efficient set of steps and strategies is very important when it comes to successfully helping guide clients on their unique financial journeys. As a possible “patchwork” of differing state-to-state regulations for financial planners lands on the table, many professionals are speaking out.
The Certified Financial Planner (CFP®) Board of Standards (CFP Board) has taken a stance in regard to state regulation of planners. Richard C. Salmen, 2018 Board Chairman of the Board of Directors for the CFP Board, Inc., said the CFP Board opposes the state regulations.
Salmen, who is also President of Family Investment Center, stated in an Investment News article that planning has developed as an interstate profession, rather than intrastate, and that many financial planners have clients in multiple states.
With most state legislatures out of session, the CFP Board is lobbying against bills that would seek to regulate the financial planning process at the state level. With a patchwork of legislation that would differ from state to state, it would make streamlined service more time-consuming and complicated for planners helping clients.
“We just don’t see that as the right way to regulate this new profession of financial planning,” Salmen said in the article. Furthermore, according to a survey by the CFP Board, only 13% of CFP® professionals favor a state regulation.
Another issue with state oversight is that some CFP® professionals would have to answer to the Securities and Exchange Commission, state regulators and the Financial Industry Regulatory Authority. Most would be encumbered by having to follow three different organizations’ rules.
While the CFP Board does not take issue with federal regulation, the Government Accountability Office carried out a study on financial planning and the results of that study did not signify cause for legislation requiring federal oversight. The CFP Board enforces educational and ethical requirements for over 80,000 CFP® professionals in the United States.
At Family Investment Center, we’re proud to have opened our offices from day one as fiduciaries – always putting the interests of our clients first and never operating on a commission-based philosophy. Contact us today and let’s talk about your next steps.
(No Shame Here … If You Know These 4 Tips)
Dec. 21, 2018
FOR IMMEDIATE RELEASE
Family Investment Center
3805 Beck Road
St. Joseph, Missouri 64508
(ST. JOSEPH, MO) Let’s cut to the chase – people give for tax benefits. This is Ok. If you’re one of them, read on for some useful tips to help you maximize your end of year giving because things are a little bit different this year. (You may get a little bit of that warm fuzzy feeling, too).
Almost everyone considers charitable contributions each December. Partly because the holidays inspire us to help others. There’s a practical reason too: December is the tax-year’s last month. Gifts given this month bring a direct impact to next April’s tax return. However, there are a few differences to note for this year.
· For one, the new tax law and new tax forms will eliminate the itemized deduction for many taxpayers. It’s still a charitable deduction, technically, but the new higher standardized deduction ($24,000 for couples, $12,000 for singles) means most filers will skip itemized deductions on the old Schedule A form. No worries, it’s like the government is giving you credit for multiple deductions even if you don’t actually use them!
· A donor-advised charitable fund can be a nice tool in this environment. These funds allow you to donate now and give later. Here’s an example: You can donate $12,000 to your fund in 2018 and earn a genuine tax deduction. In January, you can request a $6,000 donation from that fund directly to your church. You can do that again in January 2020. The church gets the money in 2019 and 2020, but you receive the whole deduction in 2018. The main benefit to this is that you can potentially “double-up” contributions so that you have enough to itemize for your 2018 tax return.
· Another benefit is that you can donate stock or other appreciated assets to the account. Maybe you’ve owned 1,000 shares of Coca Cola (KO) since 2012. Let’s say you purchased them for $37.50 and they are worth $49.50 today. You could sell them and give the proceeds to charity, but you would owe capital gains tax on $12,000 (probably $2,400, but maybe $1,200). Instead, you can donate the 1,000 shares to your donor-advised charitable account. The account will sell the shares – no capital gains tax to you – and you receive the full $49,500 as a charitable deduction this year. Also, you can send the entire proceeds or part to your favorite charity this year, next year, or any other time you choose.
· To summarize, you take the deduction in the tax year you donate, but the actual gift to charity could be some future tax year. You can give cash or appreciated assets to make your donation. With the new higher standardized deduction, you may want to stack several years of donations into a single tax year to maximize your deduction.
Obviously, the tax implications merely enhance the giving spirit. Give because you care about a group or a cause. The tax benefits are an added bonus, and a donor-advised charitable account can make that easier and more rewarding.
Most major firms offer donor-advised accounts. They have professionals on staff to help you set up and operate an account. Start with a conversation with your tax preparer or your trusted investment advisor or planner. (An attorney could be another good resource, but you won’t need one to get started. The forms are easy to use and understand).
Now, here’s to that warm giving feeling – combined with informed decisions on how to maximize that gift.
About Dan Danford and Family Investment Center:
Reflecting an unconventional approach to investing and financial planning, Family Investment Center invites clients to “plan for some serious freedom.” Now in its third decade of service, Dan Danford is Founder/CEO of Family Investment Center, a pioneer among commission-free investment advisory firms. Richard C. Salmen serves as President of Family Investment Center. Salmen also serves as the 2018 Chairman of the CFP Board national board of directors.
With a team of professionals at offices in St. Joseph, Mo., and Lenexa, Kan., Family Investment Center brings a client-focused philosophy to individuals and families in the Kansas City area and across the country.
Media sources who have interviewed or quoted the Family Investment Center team include The Wall Street Journal, The New York Times, CBNC, Barron’s, InvestmentNews, BusinessWeek, Forbes, U.S. News & World Report, The Kansas City Star, the Chicago Tribune and others.
Engage in Positive Investment Behaviors With Family Investment Center
Family Investment Center team members are no strangers to study groups and book clubs. It’s through continued education that we establish new goals and achieve them, and it’s a life-fulfilling venture that is worth the effort. Two of our Family Investment Center leaders shared their thoughts about a powerful book in a recent podcast.
Dan Danford, CEO, and Richard Salmen, President, discussed “The Power of Full Engagement: Managing Energy, Not Time is the Key to High Performance and Personal Renewal”, by Tony Schwartz. The lessons in the book, though not directly related to investing, can be applied toward retirement goals and other finance related goals.
Danford and Salmen agree that clients who have taken the time to learn the lessons provided in the book have experienced dramatic positive changes in their personal and professional lives.
Salmen has been saying for years that when there was something he didn’t want to do, he would exclaim, “I just don’t have the energy for that,” which happens to be one of the main takeaways from the book. “When we say we don’t have time for something, we really mean we don’t have the energy, or we see expending energy on certain things as a waste of energy.”
According to the book, people can expend physical, emotional, mental and spiritual energy on the wrong things. Unfortunately, our energy capacity reduces if it’s not used enough or used too often without being replenished. For example, Salmen and Danford spend at least an hour a day at their respective gyms getting in a good workout. “It’s a constant balance to stretch yourself and give yourself enough time to recover,” Salmen said. “It’s the energy and effort you put into it that makes you grow.”
Danford agrees. He said he knows people who live their lives like it’s a pinball game – they launch the silver ball up and it bounces randomly around, hitting things at random until it finally comes back down and they have a chance to launch it upward again.
“A lot of people live their life like that silver ball. No deliberate thought about ‘what am I going to do when that obstacle pops up’,” Danford said, adding that “while we can’t control everything, we should do everything possible to be proactive in exerting energy toward the things we can control.”
What does your personal freedom tour, a.k.a, retirement, look like? Who is going with you? What do you want to experience along the way? These are things you can control, so contact us at Family Investment Center and let’s talk about how to invest your energy in the right places. To listen to Dan and Richard’s podcast, click here or go to https://soundcloud.com/money-is-freedom/getting_sh_done.