3 Hot Tips to Reduce Your Taxes in 2014

Cut tax

So many of us are running around trying to get things in order for the holidays …Hanukkah, Christmas, and Kwanzaa, just to name a few. Taxes can slip our minds, and the next thing you know, we’re in 2015 and unable to do much to reduce our tax situations.

Here are 3 amazing ideas to do NOW that will help reduce your tax bill due next year.

  • Make a gift of cash. There are several things you can do that qualify to reduce your taxes or estate.
    • Make a tax-deductible donation to your favorite non-profit or charity. Who’s close to your heart? The Cancer, Heart, or Diabetes organizations seeking a cure? Stopping domestic violence, starvation, or contaminated water? Or helping addicts, runaways, and trafficked individuals, the homeless, special needs or foster kids? You can make a difference with your donations.
    • Give cash gifts to those you mean to help that aren’t non-profits. This will reduce your estate tax. Just remember the limit for this giving this year without a gift-tax assessment is $14,000 for individuals, or $28,000 is your married.
    • Invest in the futures of those you love through education, yours or someone else’s. — Opening a 529 plan and funding it before December 31, is a great way to go. The 529 account is a tax-deferred account that allows you to fund your own or your child’s or grandchild’s education.

    Nearly every state has its own 529, and as a result, they’re all unique. Most have some kind of restrictions or limits, so get on it NOW to find out if your state requires you to jump through a hoop or two.

    If you combine gift giving and funding an education, you can “front-load” a 529 with five years of tuition using your gift exclusion, totaling $70,000 individually or $140,000 for a couple. Again, check for contribution limitations on the account you’ve chosen to get involved in.

  • Target your retirement planning. Setting money aside NOW for your future is still doable. Check out these options:
    • If you have a 401(k), you can contribute up to $17,500 if you’re under age 50, and $23,000 if you’re 50 or over. If you haven’t hit the limit, ask your employer if it’s possible to add a lump sum to take you up to that limit.
    • You can still open a traditional IRA if you aren’t offered a retirement planning provision through your employer. The limits on contributions with this account are $5,500 if you’re under age 50 and $6,500 if you’re 50 or over. The account must be opened prior to the end of 2014, however, you can fund the account up until April 15, 2015. (Nice, huh?)


  • Review your investment portfolio for non-performing stocks, bonds, or securities that no longer suit you. As an advisor, we call this “tax harvesting.” When a stock or fund under-performs and creates a loss, it should be reviewed to see if it’s a position that no longer fits in with your investment policy. If that’s the case, you can acquire up to a total of a $3,000 deduction for investment losses offsetting the capital gains taxes on the winning positions you’ve liquidated already this year. It should be noted, that this only applies to taxable accounts and not tax-deferred, or qualified, accounts.

There’s a bunch of meat and potatoes in this little blog, so if you have questions or are unsure, ask your advisor. If you don’t have one, I’d be happy to help you.

Managing your money wisely gives you the most opportunity to build your wealth. That’s what I’m here for, to help you build your wealth.

If you feel you don’t have any wealth to build with, that’s a whole ‘nother blog. But allow me to encourage you to simply START. Put aside something each week, even if you if you consider it a meager beginning… at least you’ve begun! Millionaires are born from windfalls, generally. They’re made over time. You can be a part of that club with sound money habits, advice, and follow-through.

God bless you as you celebrate this season, and we’ll talk soon.

Remember, it’s your money, your rules, your way! Believe in YOU! I do.

Money Savvy Woman © 2014

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Is Retirement Saving a Joke?

Retirement Planning

Do you wish you had money to invest? Do you wonder what you should do with the money you have?
HarMoneyous™ investing is no laughing matter, and neither is saving for retirement!
In this brief blog, I’ll share the steps you need to take to get on the right path.

Decide how much each month you want to put towards investing. This may sound out of reach right now, but when you break it into bite-size pieces, it’s just like anything else. If you were to save $50 a week—that’s $10 a weekday (start taking bag lunches and nix eating lunch out)—you could save between $200-250 a month, or $650 a quarter. Now you’ve got something to work with. Even if you only have $250 a quarter saved, you’ll still have money to work with…and that’s $1000 you didn’t have saved before!

What type of account should you open? One option, should you qualify, is to open a ROTH IRA account so you can maximize your savings efforts for retirement. This account offers advantages over other types of accounts, primarily that the money deposited into it is able to grow tax-free. This is huge! With the ROTH IRA, you use money that you have saved from your paycheck. This money has already had taxes deducted from it. The beautiful thing about the ROTH IRA is that when you pull the funds out, you don’t have to pay taxes on the withdrawals. (If you’re looking to invest the savings from a retirement account from a former employer, you’ll need to open a rollover Traditional IRA account. More on that in another blog.)

There is a catch, though. With any IRA, you cannot withdraw funds once you deposit them until you turn 59 ½ , or it’s been at least five years since you made your first deposit—whichever takes longer, and you can’t make too much money. If you take the money out before the age of 59 ½ or before five years of the first contribution, you will pay a 10% penalty. After one of those qualifications is met, you can withdraw at any time and in any amount.

Open an account at a reputable discount brokerage firm like Scottrade, E-Trade, or Schwab. If you need help doing this, their customer service reps and online instructions are there to help you. Once you open the account, learn all you can on the site during the first quarter you’re saving. Some of these will have minimum requirements to open the account, so be sure you know what the brokerage you choose requires.

Invest according to your risk tolerance and the size of your investment. Often, people are confused about how to invest for retirement. They think that since they got started late, they need to invest aggressively to make up for lost time. That isn’t necessarily true or wise. The closer you are to retirement, the more conservative you should be in order to keep those dollars working instead of risking them on something that could be too risky. Secondly, if taking on a lot of risk is scary for you, then that’s something you need to consider so you can sleep at night. Additionally, if you’re investing a small amount of money, putting it in a well-diversified ETF (exchange traded fund) or indexed mutual fund could be the best route for you.
It costs money to make a trade; discount brokers offer the lowest of transaction fees. If you only have $1,000 to invest, it might make better sense to pay for one transaction as opposed to a few.

This blog is very brief, and certainly doesn’t address nearly everything you need to know or do to become a knowledgeable investor. It does, however, outline the steps you should take and open your eyes to what you might need to learn in order to do it properly. I offer coaching a programs to assist you in getting over the humps of confusion, lack of knowledge, insecurity, and accountability to make the right moves.
So if fear, confusion, or lack of accountability is holding you back from reaching your retirement dreams, I’m here for you.

What’s your next step towards achieving retirement success?

You can do this! I believe in you.

Remember, it’s your money, your rules, your way!

Money Savvy Woman © 2014

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Diversify, Diversify, Diversify! What the Heck Does That Mean??


Do you hear instructions and directions to invest but don’t get what they mean or what you’re really supposed to do? Today we talk about diversification, what that means, and how it applies to you. It’s amazing what you can learn in a brief two minutes! BTW, the website I mention is www.finametrica.com, just so you can get there without delay. Have a happy! Blessings!

Planning for the “Black Hole” of Retirement


Don’t fall in! You may never get out!!!

Many folks, especially women, unexpectedly find themselves in a “black hole” while waiting for their eligibility to receive Medicare benefits.

The black hole generally takes place between the ages of 55 and 65 when most individuals want to retire and their health insurance benefits disappear once they leave their job. That’s when they become responsible to cover those costs on their own until Medicare kicks in.

Erroneously, many people believe that you can qualify for your Medicare benefits early, much like Social Security. However, that simply isn’t true. As a result, people find themselves in a quandary when it comes to receiving healthcare during this time. Private insurance can be very expensive if not planned for well in advance. In many cases it becomes completely unaffordable once they are in retirement. It is often this expense that drives retirees back to work.

In some cases, upon retirement, the retiree can receive healthcare benefits as part of their retirement package. This is the best scenario. Unfortunately, it’s becoming more and more rare with employers cutting back on retirement benefits.

There are many available healthcare insurance programs that could be affordable if only given the opportunity to save for them prior to actually needing them. Fitting that cost into a retiree’s monthly budget prior to retiring could be a determining factor in their actual retirement date. As we know, prescription costs become more and more prevalent as we age, and in some cases are the highest expense during the month.

Retirement is a time when we look forward to enjoying the fruits of our labor. Knowing what lies ahead and planning for it can ensure the experience we’ve been waiting for. Neglecting to discover the relevant facts to a successful retirement could put the kibosh on all those lovely plans.

Go into your retirement with your eyes wide open, knowing what you can expect your expenses to be, and having adequate funds to meet those needs. Wouldn’t you rather be cruising around the world as opposed to counting pennies to make ends meet? The choice is yours.