Do you know sometimes when shopping for new policies its best to provide your previous policy to the new company if you have had any no fault accidents…Why? Well rather than relying on motor vehicle reports, some companies misreport to your CLU (think of it as a insurance credit report) that way if you ever look to change companies, your quotes will be much higher and it will drive you back to their lower rates. Biggest culprit of this is supposedely “the gecko”.
Refinancing your mortgage
With mortgage rates at historically low numbers, if you haven’t looked yet at refinancing, now is definately the time. Depending on your current rate you can potenially refinance a 30 year to a 15 and have the same monthly payment or significantly reduce the payment you have now. You can use free calcualtors on sites like www.bankrate.com or a site i know that lets you see their rates and create different worksheets is www.absolutemortgageco.com ( though not endorsing them, they do have good rates usually and have personally used them to assist a client with refinance)
By paying a slighly higher fee than current rate you can even incorporate the closing costs into the loan. Just remember the title company/attorney fees/gov’t fees are consistant no matter who you use just make sure you look at the lender fees. The best way to compare is to look at APR as opposed to the interest rate. Good Luck
Make your charitable contributions more effective using Donor Advised Fund
If you already contribute to charities and the amount is signficant (greater than a few thousand) you may want to look into a donor advised fund. The funds operate as independant charities which allow you to take tax deductions in year of contribution but you still control when and to who grants are made to. These funds also allow contributions by securities and sometimes art so you incur no tax consequence in contributing them by having to sell first.
If you converted to a Roth and already make charity contributions this is a great strategy to help lower your additional tax due. By upfronting a few years worth of charity contributions you can use this to offset your extra income in 2011 or 2012 from the roth conversion.
For more information and details contact us at TCS Financial Services 877-827-4685
Posted in Estate Planning, Investing, Tax Planning
Tagged charity tax, donor advised
Leave a comment
85% of clients dont understand or heard of Fiduciary versus Suitability?????
Do you realize that your broker doesnt have to choose the best product for you but only that it be suitable for you…while this example i give is an exageration it is to make a point. There is a mutual fund out there that exactly duplicates the S&P 500 and charges 1% in annual fees…rather than invest in this product your broker can instead invest in their own companies mutual fund which charges 10% in annual fees (2% to your broker in commission) plus isnt able to be held outside this (brokerage) company….you are thus paying 9% more for an exact same product ( a duplicate of the S&P 500) plus if you ever decide to move your account to somewhere other than their firm you will be forced to sell and pay tax as opposed to just moving the fund which is held everywhere.
This is perfectly acceptable as the product was suitable for you… sound good??? I think its time more than 85% of people understand this difference. As a fiduciary, I and other fiduciary providers are required to provide you with the best product regardless of our own self interest. Just one reason more to choose a CFP®
For more in depth information feel free to check out this old article on Forbes http://www.forbes.com/2009/06/23/suitability-standards-fiduciary-intelligent-investing-brokers.html
Lawrence W. Wiswall Jr., CFP® from TCS Financial Services an independant wealth management firm
Posted in General Financial Planning, Investing
Tagged CFP, Fiduciary duty, indepenant versus brokerage
Leave a comment
Not too late to benefit from a 529
Is your child starting college this fall and your picking up the tab? Well before you pay, you may want to see if your state is one of the many that offers deductions to your state taxes for contributions.
Even if you missed out on contributing and getting the tax free growth over the past 18 years, parents can still open and fund a 529 this year and then use those funds to pay for the tuition costs. You can also pre-fund up to 5 years of your annual gift limits for each parent.
Check first your states’ limits and whether your state offers this incentive but this can lead to savings come next spring.
Comfortable with options and waiting for lower market?
With market near highs and worried about a potential downturn, Collars are great option. You purchase Puts, protecting your downside, with the proceeds you recieve from selling an out of the money Call…ideally this results in no out-of-pocket cost and while limiting your upside gains, it protects against the downside.
Unfortunately at this time options are very expensive and many people are waiting for a pull back before they put their money back in the market. Why not consider the alternative strategy of selling a cash secured Put to take advantage of high option costs and earn some yeild while waiting to purchase at lower levels. Using this strategy, you committ to purchase at a lower strike price and get the funds from selling the Put. The risks of this strategy are if the price drops below the strike you are required to purchase (which you planned to do anyway) or the stock takes off and you do not own it.
Because you potentially might get called, you need to have the cash available to purchase the security, however your adjusted cost basis is even lower than strike as you have already recieved proceeds for selling the Put. If the options expire and price doesnt fall below the strike you still keep the proceeds from the sale, which you can potentially get double digit annualized returns. This strategy is ideal for those sitting in cash waiting for certain points to buy into market.
Want to employ this in your portfolio and learn more…contact us.
Welcome
Welcome to TCS Financial Services’ new blog, INSIGHT. This is intended to educate and pass along ideas in investing and financial planning topics. Please feel free to comment or ask additional questions based on future blogs.
Posted in Uncategorized
Leave a comment