In Transit…

It is the time of year when employees make their benefit selections. Many of them do not know what they are selecting, but next year thousands of dollars will be deducted from their paychecks to pay for benefits they know very little about. Many employees select the lowest premium plan without realizing that it does not cover the spouse’s prescription medications or the child’s therapy. A friend of mine recently came to me for assistance in selecting her family’s benefit plans for next year. She was handed an enrollment form to make her selections and no other information. When I started asking her questions, she could not answer them. There

The point is that every person’s situation is unique, and there is hardly ever a cookie cutter answer to the question, “What should I do with my money?” This is the question I hear just about every day of my life. It is an excellent question and can only be answered with another question. Some days the answers in life are simple and other days the complexity of life is beyond our imagination. The answer to this question is somewhere in between. It begins with a couple of simple questions. First of all, what is the purpose of the money you are referring to, and what is the time frame?

There are a lot of reasons to celebrate today. Sure, we are in a pandemic and many people are divided by the who’s who in politics, but there are still so many reasons to celebrate, at least in the real estate industry. Low interest rates, great mortgage incentives — for both new and seasoned buyers — and lower credit scores are celebration enough. When interest rates go down, people qualify for a higher priced home for the same monthly payment. As Chris Marr, a mortgage sales manager says, “Current rates are still low and underwriting standards have also been lowered and modified in order to help first-time homeowners with approvals.”

1. “Pay taxes on the seed, not the harvest.” When you invest in Roth IRAs and 401(k)s, you pay taxes on the money you contribute. Because you already paid the tax, no tax is collected when the money is taken back out. 2. Convert IRAs into Roth IRAs. Make after-tax contributions now, and you will enjoy tax-free withdrawals during retirement. 3. Convert 401(k)s into Roth 401(k)s. Make after-tax contributions now, and enjoy tax-free withdrawals during retirement. As an added bonus, companies often match some or all of the money you invest. 4. Utilize 1031 exchanges on Real Estate. There is a 6 month window to prevent payments on capital gains