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Archives for December 2016

December 2nd Corporate Event at Second Harvest Heartland

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Our team had a wonderful time volunteering at Second Harvest Heartland on December 2nd.  We closed shop and headed over to help sort and repack food for working adults, children, and seniors who are struggling with putting a meal on the table.  

Second Harvest Heartland clients come from rural, urban and suburban areas, of every age and background. They find creative solutions to connect the full resources of our community with our hungry neighbors. There is more than enough food available to feed everyone!

We had fun sorting and repackaging crisp rice cereal from a bulk portion into smaller one-pound

Every day Second Harvest Heartland needs more than 300 volunteers to help get food to people in need. And we were glad to pitch in!

5 Quick Tips To Save You Money And Time Before The End Of 2016

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With holiday shopping and festive menu planning, it is easy to lose track of things that are less exciting – like taxes and money management. Knowing that, I have compiled a short checklist of 5 things that, if done now, can save you considerable money before the year is over. The best part is they are quick to do, so you will be back to celebrating in no time!

  1. Get yourself organized. As year-end statements  and tax forms begin to show up in the mail, file them into a tax binder or folder. You might keep that folder next to where you usually sort mail to make this easy. Having your documents in one place can go a long way towards managing the cost of tax preparation.
  1. Make an additional contribution to your retirement plan. If you have a traditional (non-Roth) retirement plan or a traditional IRA and are under 70½, you can save money on taxes by making a qualified contribution. The contribution will decrease your taxable income, and you get the benefit of boosting your nest egg! I know that holiday budgets can be tight, but the benefits of investing in your peace of mind will last longer than your Christmas tree.
  1. Look into tax loss harvesting. If you can use a reduction in your taxable income this year, consider selling some underperforming stocks before December 31. Capital losses in excess of your gains of up to $3,000 can be used to offset your taxable income, and any excess can be rolled forward to 2017.
  1. Keep track of your holiday budget. With the excitement of the season, it is easy to lose sight of your spending. Remember that the best predictor of your retirement success is your ability to save. Use a formal budget to manage how much you spend on gifts, holiday parties, shopping for the holiday table and eating out. A holiday does not have to break the bank to be memorable.
  1. Criminals don’t take a Christmas break! Identity theft is a threat year-round, but especially so during the holidays. Now is a good time to request your free credit report. I recommend using www.AnnualCreditReport.com – it’s one of the few outlets that is truly free (no credit card required). Be sure to monitor the activity on your credit cards and bank statements a little more closely. Don’t let crooks go holiday-shopping on your dime!

Finally, remember that the best way to avoid wasting money and time is to make sure you have the right strategy in place for your retirement. Don’t leave your security and peace of mind to chance!

Call us today at 952-460-3260 or click here to set up your free 60-Minute One On One Retirement Readiness Lab™ With A Certified Financial Planner Professional.

We are here to help through the holidays and into 2017!

Does Income Predict Net Worth?

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High income is not always correlated with a high accumulation of wealth. The difference often lies in the income-earner’s level of spending versus saving, but other traits may contribute as well. It’s not uncommon to hear about millionaires who end up penniless and humble workers who diligently save long term to amass wealth. For example:

  • Oseola McCarty, an African American woman born in 1908, began a 79-year career of laundering clothes by hand. Saving diligently from the age of eight, she retired in 1995 with $280,000 in the bank, promptly donating $150,000 of it to fund scholarships for worthy but needy students at the University of Southern Mississippi.
  • One couple saved millions while working in the airline industry with a combined salary of $115,000.
  • Former boxer Mike Tyson, who, at his peak, was earning $30 million per fight, lost most of his wealth due to lavish spending, a divorce settlement and back taxes.

Intelligence, social skills, health and motivation are all traits that could determine someone’s net worth. In some cases, high net worth can also lead to a higher level of income. For instance, family wealth could play a part in a child receiving a better job. Someone who is already wealthy may also have increased confidence in pursuing new job opportunities.

It stands to reason that the older we get, the more we tend to accumulate assets that are not necessarily associated with our level of income. For example, years of saving, home equity appreciation and investment compounding all contribute to our net worth. More than 60 percent of households headed by someone age 65 and over have at least six-figures of wealth; more than 10 percent are into seven figures.

Parental Financial Socialization

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“Parental financial socialization” is an ominous-sounding term that basically describes parents who freely and openly discuss money matters with their children. Parents can have a tremendous influence on how children value and manage money, and those values are often carried over into adulthood.

Parents who assist an adult child financially can cause dependency issues, while parents with fewer financial resources to help often find that their children learn more quickly to become financially independent.

Knowing when to start and stop giving children monetary pointers can be tricky. When parents share too much financial information with children who are too young to process the information, it’s called “financial enmeshment.” This can cause children to feel anxiety.

The important takeaway is that how we conduct our financial lives and the way we talk about them in front of our children can impact their lives, even through adulthood. 

Fed View on Interest Rates

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In October, Federal Reserve Vice Chairman Stanley Fischer offered remarks concerning the state of the U.S. economy and some reasons for sustained low interest rates. He observed that the real interest rate could be considered the price that balances the economy’s savings reserves with its investment demand.

To explain why interest rates are low, he said the Fed assesses various factors that influence higher savings and reduced investing. According to Fisher, primary forces that have impacted this equilibrium in recent years include:

  • A slowed pace of innovation, which reduces opportunities for investment.
  • Lower productivity growth, which reduces household consumption and increases the need for savings.
  • The “graying” of the population, which is expected to reduce the workforce by about .25 percent in the coming years, furthering the trend for lower productivity and slower labor force growth.
  • The increasingly aging population also means that more people are saving for retirement.
  • Reduced investment in turn provides companies with less capital to invest in growth, further perpetuating the cycle for less interest in investing.
  • Sustained low interest rates and the slow pace of growth abroad means foreign countries offer less appealing investment options as well.

Ultimately, slower productivity growth tends to depress investment and encourage savings, which in turn pushes interest rates lower. The federal funds rate has remained low for quite some time now as the Fed looks for the economy to support its goals for sustainable employment and inflation at a target level of 2 percent.

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Danielle Christensen

Paraplanner

Danielle is dedicated to serving clients to achieve their retirement goals. As a Paraplanner, Danielle helps the advisors with the administrative side of preparing and documenting meetings. She is a graduate of the College of St. Benedict, with a degree in Business Administration and began working with Secured Retirement in May of 2023.

Danielle is a lifelong Minnesotan and currently resides in Farmington with her boyfriend and their senior rescue pittie/American Bulldog mix, Tukka.  In her free time, Danielle enjoys attending concerts and traveling. She is also an avid fan of the Minnesota Wild and loves to be at as many games as possible during the season!