An Umbrella What?

An Umbrella What?

Protecting yourself and your family is top priority for most, and households purchase different types of insurance to ensure that they are properly covered from unforeseen events.

A very important form of insurance that people frequently overlook is Excess Personal Liability, which is commonly referred to as Umbrella insurance. Umbrella insurance provides additional liability coverage above the limits established through other basic liability policies like auto and homeowner’s/renter’s. Umbrella insurance is designed to help guard against large and potentially devastating liability claims or judgments caused from bodily injury, property damage, lawsuits, libel, and slander.

Credit Card Conundrum

Credit Card Conundrum

Although credit cards have a negative connotation, they can be a useful tool to have in your wallet. There is a wide array of benefits associated with different types of cards, i.e. cash back, reward points, etc. The card you choose can have a significant impact on your financial wellbeing, so here are some steps to help select the credit card to best fit your needs.

Equifax Breach and Freezing My Credit

The Equifax hack has raised a number of questions about what you can do to protect yourself. Reed Fraasa, President of HIGHLAND, shares his experience with freezing his credit along with providing some helpful resources.

According to the Identity Theft Resource Center, there have been 7,900 data breaches involving over 1 billion records of personal information from January 2005 to September 2017.   The recent Equifax breach is one of fifteen mega breaches over the last ten years involving major corporations’ consumer data.  I finally decided to freeze both my wife’s and my data last week.  Here is what I learned from the process:

The Sunk Cost Fallacy

Have you ever made yourself sit through a horrible movie because, having paid for the ticket, you felt you had to get your money's worth? Some people treat their investments in a similar manner. 

Behavioral economists refer to this propensity of people and organizations to stick with a losing strategy purely on the basis that they have already sunk so much time and money into it already as the "sunk cost fallacy."  

The Next Generation of Banking

Technology has advanced in ways many thought wouldn't be possible and has solved problems we didn't even know existed. At the forefront of this movement has been the financial services industry, which has developed technology that has completely changed the banking experience over the past decade. Gone are the days of going to a bank branch and waiting in line to make a deposit or withdrawal; the digital age has made transacting quicker and easier than before. Below I have highlighted two recent technology advancements in the banking industry that could further revolutionize the customer experience.

The Full Ride Scholarship and 529 Plan Savings

You have done an excellent job saving for your child to go to college – in fact you have accumulated close to $200,000 in assets in a 529 college savings plan.  The acceptance letters start rolling in and you find out your son or daughter gets a full ride scholarship to their school of choice.

Great news!  You probably plan a party to celebrate – but you realize $200,000 of your wealth is locked up in the 529 plan.  What can you do?

Tips for Buying a Car

It has been some time since we sent out a newsletter - after a physical move to our new office space in Wayne, and a transition to a new operating system it has certainly been an interesting month!  Here is a great article a fellow Advisor in our office, Pete McKenna, put together on what to think about when purchasing a car.  Happy Spring!

3 Things to Know Before You Go Into Underwriting For Life Insurance

Unfortunately, when I tell someone I am a financial planner usually their first reaction is to say – “Oh so you sell insurance?”  It drives me nuts.  Planning is not selling investments, life insurance, or any other product – it is simply helping clients make confident financial decisions and reach their goals.

With that being said, life insurance plays a key role in a financial plan.  In fact, the results of the financial plan will dictate how much and for how long you need insurance.

The 83(b) Election

If you are the founder or an employee of an early-stage company and have stock awards subject to a vesting schedule, then the 83(b) election is going to be a very important tax decision.

The 83(b) election is a section of the Internal Revenue Code that allows individuals with restricted stock awards subject to a vesting schedule to accelerate the taxation of the income.  The election is made by submitting a form to the IRS requesting to be taxed on the value of the stock the date it was granted instead of when it would vest.

Financially Fit

We all love free money – and who would not want free money come the holiday season?  New Year’s is also around the corner and along come with it resolutions to eat healthier, exercise, and of course save!

Here is our attempt to highlight some well know smartphone apps to help you save and also get in better shape – this however is by no means an endorsement of any app.  If you know of any other apps you use and have had success with send them on over!

The Cost of Leaving the Workforce to Care for a Child

One of the toughest decisions new parents will make is weighing the pros and cons of one of the parents leaving the workforce to care for the kids as the cost of child care has grown exponentially over the last decade.  In a new study conducted by the Organization for Economic Cooperation and Development, the cost for two children, an infant and a four year old, in a child care center is $18,000 a year. 
 
For some parents, it may make sense to leave the workforce for a few years rather than pay for child care. 

The Power of Compound Interest

“Compound interest is the eighth wonder of the world. He who understands it, earns it…he who doesn’t…pays it.” - Albert Einstein

The definition of compound interest is simple: it’s the interest you earn on both your original money and on the interest you keep accumulating. Compound interest allows your savings to grow faster over time because each time interest is calculated and added to the account, the larger balance results in more interest earned than before.

The Basics of Saving For Retirement

Planning for retirement can sometimes become an afterthought, especially when things like planning to buy your first home, starting a family, or funding 529 plans for your children seem to get in the way.  Life is complicated and balancing the needs and wants of today with those of tomorrow is difficult.

So what can you do? And more importantly what should you do?

Is it Time to Redeem Your Old U.S. Savings Bonds?

When I was growing my grandparents would always give me savings bonds as gifts for birthdays and holidays. At the time, I wasn’t truly enamored with receiving a piece of paper essentially amounting to an “IOU” in the amount of $50 or $100 as a gift. After all, what money hungry kid wants a promise to receive a certain dollar amount in the future rather than actually receiving the cold hard cash right then and there? The answer is probably none, unless that child has done his homework on the power of interest and has the rare ability to think about the future instead of being focused solely on the present.

It's Open Enrollment Season!

What is Open Enrollment?  Open Enrollment is the time of year when your employer allows you to make benefit elections on things like health insurance, dental and vision coverage, life insurance, disability insurance, etc.

We decided to take a look at two tax-advantaged ways for you to pay for out-of-pocket medical expenses – the Flexible Spending Account, also known as an “FSA” and the Health Savings Account, also known as the “HSA”.

So what are they?

Should You Switch to an Online Bank?

In the last decade, online banks have grown in number and popularity. What was once a niche market dominated by a few big players has become widespread, with a wide number of banks with strong reputations entering the space. Online banks differ from traditional banks in that they don’t have brick-and-mortar branch locations. This business model translates to increased operational efficiency because online banks do not have to pay rent for branch locations and hire branch employees. So why should you care about a bank’s business model?