Archive for Yeske Buie Millennial

Featured FinTech

Financial Planning, Yeske Buie Millennialon September 6th, 2018No Comments

Written By: Lauren Mireles, FPQPTM

FinTech, or Financial Technology, refers to the innovative use of technology to streamline financial activities including lending, investing, making payments, and more, and it has revolutionized the way our society interacts with money. Even if you don’t care for all the fancy smart phone apps, think about how ATMs replaced bank tellers, or how credit cards eased the burden of carrying cash – that’s FinTech! Over the next few months, we’d like to share with you some of the FinTech products that are catching our eye these days, and highlight them in this space we’re calling Featured FinTech. We hope you enjoy these examples and as always, we’d love to hear from you – what apps, websites, and products are on your must-use list? Let us know by leaving a comment below or emailing Mila@YeBu.com, and you may see your suggestion featured here soon!

BusyKid: Chores & Allowance Simplified

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  • What is BusyKid?
    • BusyKid is a mobile app that facilitates the electronic exchange of money between parents and kids for completed chores. The app allows parents to add chores to their child’s list, assign a chore value to each activity, and facilitate the exchange of money for a job well done. As the child accrues money for their completed chores, the app provides them with four options for spending their money: Cash Out, Gift Cards, Stock, or the “BusyKid Visa® prepaid spend card”. Parents still have approval power related the child’s allowance and spending as transactions must first be approved by the parent. This approval can be as simple as answering “yes” to a BusyKid text message.
  • How did BusyKid come into existence?
    • BusyKid first emerged in 2011  when a father of six was looking for a way to track his kids’ chores, pay them a weekly allowance, and teach them basic financial literacy skills. From this need, he created My Job Chart, which has since evolved into BusyKid to include additional security, technology, and features.
  • What do we like about BusyKid?
    • BusyKid teaches kids the imperative financial literacy skills we at Yeske Buie also promote with our Financial Literacy Program – save, spend, donate, and invest. And, we feel it does so in an interactive and “cool” way via a smartphone app.
    • The electronic exchange of money is the reality of today’s financial landscape, and BusyKid introduces this reality to kids early on. Terms like direct deposit, move money, and credit are introduced in the app at a much earlier stage than would typically be relevant.

Finding Financial Independence

Financial Planning, Yeske Buie Millennialon June 29th, 2017No Comments

Written By: Lauren Mireles, FPQPTM

There is no one-size-fits-all definition for the term “financial independence”. In fact, you won’t even find the term in the Merriam-Webster Dictionary. This ambiguity allows for individuals to define the term for themselves. Some may associate financial independence with goals like being on track for retirement or having a sufficient emergency fund while others may see independence as being debt-free, earning enough money to pay your bills and support a loved one, or leaving a financial legacy that is reflective of your values.
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As is the case for independence from government or other entities, achieving financial independence requires commitment and sacrifice and each individual’s journey to financial freedom will be different. So where do you start? Exploring how you define financial independence and reflecting on personal goals is a productive first step as this process may help you identify a destination for your journey. At Yeske Buie, we have a variety of tools* and resources that you may find useful in your exploration and reflection. If any of the following titles interest you, we encourage you to review the tool and consider how the questions may help you define financial independence:
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  • Defining True Wealth: Helps you clarify what is most important to you to provide an effective framework for creating plans and making important life decisions.
  • Designing Your Financial Legacy: Helps you consider what is most important to you and how these values can be reflected in your financial legacy.
  • Financial Satisfaction Survey: Helps you think about and assess how satisfied you are with many aspects of your financial life.
  • My Ideal Week in Retirement: Helps you visualize how you will invest your time in retirement in a way that is meaningful and purposeful to you.
  • Visualize Your Future: Helps you clarify your values and priorities and begin to identify your life goals.
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If you’d like to discuss your answers to these questions or your thoughts on your journey to financial independence, please don’t hesitate to contact us. We’re happy to help you talk through this reflective step, how to convert your thoughts to actions, how to implement the actions, and anywhere in between.
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*courtesy of Money Quotient

Cyber Spring Cleaning

Cybersecurity, Financial Planning, Yeske Buie Millennialon May 3rd, 2017No Comments

Written By: Lauren Mireles, FPQPTM

If you haven’t already started, you may be planning to embark on a spring cleaning binge in upcoming weeks. A typical list of spring cleaning projects likely includes de-cluttering your living spaces, wiping down your walls and ceilings, and swapping your winter clothes for a summer variety. But when is the last time you “scrubbed” your digital life? Regular maintenance of your digital devices, profiles, and online identity is key to protecting yourself from the “dirt” of phishers and hackers. Below we offer a cyber spring cleaning checklist that you may consider adding to your remaining spring cleaning initiatives.

  1. Review your accounts and make it a habit to proactively check them on a regular basis. Make sure to read your Schwab and other financial account statements each month; once you’ve done so, shred them.
  2. Clean out your old email and empty deleted folders. If you need to keep old messages, move them to an archive. You may also consider unsubscribing from newsletters, email alerts and updates you no longer read. A full list of email best practices can be found here.
  3. Turn on two-factor authentication (2FA) on critical accounts like email, banking and social media. Get the 411 on 2FA here.
  4. Update all software and apps on your computers and handheld devices; especially those that are connected to the Internet.
  5. Refresh your passwords with a structure that is not easy to guess and keep them in a safe location away from your computer. Make unique passwords for important accounts like email, finance and healthcare. Be sure all relevant devices are password, passcode, or fingerprint protected. This includes devices like your phone, tablet, internet router, and more.
  6. Monitor your credit report for early detection of identity fraud. You can learn more about how to conduct A Careful Review of Your Credit Report here on our website.
  7. Own your online presence by reviewing the privacy and security settings on websites you use to be sure they are set at your comfort level for sharing.
  8. Consider enrolling in IdentityForce’s robust and comprehensive service to rest assured that another set of eyes is proactively working to protect your identity, privacy, and credit.
  9. Digitally “shred” old, unneeded devices including external hard drives, USBs, and memory cards. The Better Business Bureau hosts Secure Your ID Day digital shredding events nationwide, many of which include electronic shredding.

For more ideas on how you can declutter your digital life, check out the Better Business Bureau’s Digital Spring Cleaning checklist.

And of course, like house chores, cleaning your digital life is not an one time event. We encourage you to explore the following posts for healthy technology that habits you can adopt this spring and throughout the rest of this year:

Don’t Fall For The Imposter

Cybersecurity, Financial Planning, Yeske Buie Millennialon April 5th, 2017No Comments

Written By: Cristin Etheredge, FPQPTM

The Federal Trade Commission (FTC) recently released their annual summary of consumer complaints and consumer protection statistics for 2016. For the first time in the 20 years that the FTC has been keeping records, imposter scams surpassed identity theft among reported consumer complaints. When you combine these two issues, the FTC complaints exceeded 800,000 in 2016.

Imposter scams are situations where a hacker pretends to be someone that they are not. The imposter usually poses as someone you are likely to trust like a government official, bank representative or computer technician; and then they fraudulently seek money.

Statistics show that one of the primary ways fraudsters will likely try to reach you is by telephone. The complaint data that the FTC collected showed 77% of reported fraud was done by phone, 8% by email, 6% through the internet and 3% through postal mail. These scams cost consumers a reported $744.5 million dollars last year, or an average of $1,124 per complaint – and these numbers are only from the fraud that was reported to the FTC.

Despite the rise in reported scams, identity theft complaints dropped by 19% when compared to 2015, and the drop is largely attributed to the public becoming more knowledgeable and diligent with safeguarding their personal information. With that in mind, we share a few of the most common scams that fraudsters are using right now to provide you with ways to safeguard yourself against imposter scams and help ensure that you don’t fall for the imposter.

  • IRS Scam 
    • Fraudsters contact you and claim that you owe money. Typically, imposters will threaten legal action unless you make an immediate payment through a money order, cashier’s check or prepaid debit card. Keep in mind, real IRS agents will always first contact you by postal mail before any other source, and the agency accepts both checks and credit cards. Read more in Tips to Thwart Tax Thieves.
  • Other Government Officials 
    • As more people learned of the fraudulent IRS scams, fraudsters broadened their horizons. Claims have been made that imposters have been posing as any federal government employee to “verify” personal information via phone, including the US Dept. of Health and Human Services. Scammers are able to fake people into believing they are legitimate, because they are able to “spoof” the caller-id to appear legitimate. Common tales that they will say are you’ve ‘won’ a lottery or sweepstakes or that you owe a fake debt. Keep in mind, like the IRS, the federal government will likely contact you via postal mail first, and federal employees will not demand personal information.
  • Tech Support 
    • In these instances, either you get a phone call or a popup on your screen that a problem or security issue with your computer has been “detected”. The scammer’s goal here is to convince you to download malicious software or create a remote session to give them the ability to control the machine. In both of these cases, the fraudster is trying to either steal your data or hold it hostage until you pay a ransom. Keep in mind, legitimate tech support is not going to contact you unless you have previously contacted them about an issue.
  • Can you hear me now? 
    • The phone rings from an unknown number, and the first thing you hear is “Can you hear me now?” These are pre-recorded calls, and the aim is to record your voice saying “yes” and other things that fraudsters could potentially use to obtain money. Do not say anything, just hang up. If your numbers are not currently on the Do Not Call registry, consider adding them. Also consider becoming familiar with blocking unwanted calls. Keep in mind, if you respond to these calls in any way (like pressing 1 to speak to someone), it is likely to lead to more robocalls.
  • Virtual Kidnapping 
    • Using social media as their tool, fraudsters have taken up the task of claiming that they have kidnapped a loved one and demand immediate payment. The FBI calls this virtual kidnapping. This scam has been around for a while, but it recently has resurfaced. Read more from the FTC. Keep in mind, if the call feels real, hang up and get in touch with the relative or friend in question.
  • Grandkid 
    • Fraudsters purchase marketing lists just like large retailers do, but fraudsters use the lists to find vulnerable populations they might be able to exploit. 37% of imposter scam victims last year were over the age of 60, and fraudsters are using tactics like the love of grandchildren to scare their victims. What tends to happen in these scams is a person will receive a call from an unknown number and the person will pretend to be a young relative out of town and in trouble. The caller will plead with the grandparent not to tell anyone and claims that the only way to get out of the bind is to receive a wire transfer. Keep in mind, much like the last section, call or text the grandchild directly (how often are they without their mobile?)!
  • Online Romance
    • While online dating has become commonplace, so has the ability for con-artists to take advantage of those looking for love. Typically what happens in this scenario is that a person a distance away contacts you. Quickly, they become enamored, claiming that you’re the man/woman of their dreams and they would love to meet, BUT… (they are out of town/country, have a sick or dying relative, stationed abroad). Shortly after, requests for money will start. Keep in mind, if you provide cash to someone you have not met yet, often another emergency will require more.

 Tips to Remember

  • Consider how the person on the phone is asking you to pay. 58% of fraud victims last year paid via wire transfer and some fraudsters were able to get their victims to pay with prepaid debit cards (7%), which is difficult to trace or to reimburse victims.
  • If possible, let unknown numbers go to your voicemail. Fraudsters are unlikely to leave you a voicemail. Consider services like Hiya or Nomorobo to have no more “robo calls”.

For more information on these scams, feel free to review the FTC’s entire 104 page report which includes a breakdown by state, complaint type and age of victims.

Can Money Buy Happiness?

Fun Stuff, Yeske Buie Millennialon March 9th, 2017No Comments

Written By: Lauren Mireles, FPQPTM

Researchers are continually looking for ways to prove whether or not money can buy happiness. We recently came across an article by Kira M. Newman that argues that it is possible for money to bring you happiness and reflects our belief that “It’s about the size of your life, not the size of your wallet®”. The ideas in the article are supported by a study that focuses on factors that bring and sustain happiness and suggest that spending money in more fulfilling ways to bring you closer to other people can, indeed, increase your happiness. We share Newman’s suggested six ways to get more happiness for your money below. As you read through these suggestions, we encourage you to reflect on how they relate to the Live Big® life you’ve defined and how you may increase your happiness in 2017 and beyond.

  1. Spend money on experiences
    • Studies have shown that experiences impart greater and longer lasting happiness.
  2. Better yet, spend money on experience you share with others
    • Experiences shared with others, whether in real time or in the retelling, have been show to impart greater happiness.
  3. Spend money on other people
    • Spending money on others in a way that fosters a social connection has been shown to be one of the most internally fulfilling ways to give financially.
  4. Spend money on the right people
    • It is embedded in our DNA to want to take care of those with whom we have strong relationships – our family and friends.
  5. Express your identity through spending
    • Spending your money on experiences or goods that match your personal preferences has been reported to give people more satisfaction with their life.
  6. Think less about spending
    • When you earn your money, you also earn the right do with it what you want! Give yourself the freedom to explore life and spend your money in ways that matter most to you.

Assembling Your Financial First Aid Kit

Financial Planning, Yeske Buie Millennialon February 22nd, 2017No Comments

Written By: Lauren Mireles, FPQPTM

We’ve talked to our Clients many times about the importance of emergency preparedness. Preparing for an emergency can take the form of kits with food, water, and supplies, plans for what you and your family will do in an emergency, or the often overlooked financial first aid kit. Having a financial first aid kit helps to ensure that the tangible pieces of your financial life are safe and easily accessible at any moment.

The first consideration for your financial first aid kit is where to keep your valuable documents. We find that safes that are waterproof, fire-resistant, and easy-to-carry make the best vessel for storing your financial documents. A variety of well-reviewed safes are available on sites like Amazon and Staples including the SentrySafe Waterproof Fire-Resistant Chest or the SentrySafe Fire-Safe Waterproof File Safe. For an added layer of protection, you may consider purchasing a fire-resistant, fiberglass envelope pouch, like this one, which adds additional heat resistance in the case of a fire.

With your container in place, you can now focus your attention on assembling all of your important documents. Below is a comprehensive list of items to consider gathering to ensure your financial first aid kit is well-stocked for any emergency. While you collect these items, it’s also a good idea to give them a quick review to ensure the documents are up-to-date and accurate. Furthermore, it’s helpful to make a habit of revisiting these important documents on a regular schedule. You can use specific yearly events like tax preparation time, the start or end of daylight savings, your birthday, or the start of a new year to trigger your reminder to review the information. Finally, it’s recommended that you keep a second copy of this kit with someone you trust that is not in close proximity to your geographic location. This way, you can rest assured knowing that the information can be accessed elsewhere in the event that your copy is unavailable in an emergency.

We hope you find these tips empowering! Having a well-stocked financial first aid kit can help you be confident that your financial life is safe in the event of any challenges and complexity that may come your way. If you’d like our assistance in helping you collect any of the information below, please do not hesitate to contact us. Happy Prepping!

  • Identification Documents
    • Driver’s license, Passport, and other Photo ID (for yourself and your children)
    • Birth Certificates and Adoption Papers
    • Marriage/Divorce License
    • Social Security Cards
    • Military ID or Military Discharge Records
  • Housing Payments
    • Lease or Rental Agreement
    • Mortgage, Real Estate Deeds, and HELOC Information
  • Financial Obligations
    • Utility Bills
    • Vehicle Loan Payments and Registration Documents
    • Photo Copy of Credit Card Numbers and Phone Numbers to Report Lost Cards
    • Student Loan Agreements
    • Alimony/Child Support Payments
    • Retirement Account and Investment Account Custodians and Numbers
  • Insurance Policies
    • Property, Homeowners or Renters Insurance Documents
    • Photos or Video of Property Inventory
    • Copies of Auto Insurance, Life Insurance, and Health Insurance Policies
    • Appraisals of Personal Property
  • Sources of Income
    • Recent Pay Stubs
    • Government Benefits Information (including Social Security and Veterans Benefits)
  • Tax Statements
    • Previous Year’s Tax Returns (it is recommended to keep tax returns for seven years)
    • Property Tax Statements
    • Personal Property Tax
  • Estate Planning
    • Copy of Living Will
    • Copy of Trust(s)
    • Copy of All Medial/Durable Power of Attorney
    • List of Account Beneficiaries with Contact Information
  • Medical Information
    • Contact Information for Physicians and Medical Specialists
    • Copies of Medicare or Medicaid Cards
    • Immunization Records
    • List of Medications
    • List of Current Prescriptions
    • Disability Documentation
  • Emergency Points of Contact
    • Name, Phone, and Address Information for the Following Points of Contact
      • Financial Advisors
      • Health Professionals
      • Service Providers
      • Lawyers
      • Insurance Agents
      • Mortgage Representative
      • Work Contacts
      • Extended Family
  • Passwords to Financial Accounts
    • List of Up-to-Date Usernames and Passwords for Important Accounts
  • Small Amount of Cash
    • In the event that ATMs and credit cards are not operational, it’s smart to have a small amount of cash available

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Ask the Experts: Budgeting for a Wedding

Yeske Buie in the Media, Yeske Buie Millennialon February 8th, 2017No Comments

A recent article on WalletHub.com featured a list of “2017’s Best Places to Get Married” which highlighted cities with the lowest and highest wedding costs, most and fewest wedding chapels, event planners, bridal shops and more. To supplement the research findings, the article also included an “Ask the Experts” section which asked legal experts, financial experts, and professors in family study programs for their insights on financial considerations for brides and grooms-to-be. Lauren Stansell, Financial Planner in our San Francisco office, provided her thoughts for the article – a very appropriate topic for Lauren to comment on as she’s currently planning her own wedding! – and we’ve shared her answers below.

  • What factors should couples consider when setting a budget for their wedding?
    • There are many factors to consider when planning a budget – it’s easy to think of the big ticket items like the venue, catering and music, but the little items add up, too! So it’s important to really think through all pieces of the budget together as a couple when making your initial plan. There are many sample budgets online that can show you typical spending by category, give ideas on where you can safely cut costs and find budget-friendly options, and provide resources for further research in each category. I found these very helpful in the early stages of budgeting because they provide you with a massive list of things that could come up – and they can also show you some ‘typical’ wedding expenses you may not care to include at all.
  • How should a couple decide where to get married?
    • Deciding where to get married can be influenced by many different factors (including family members and friends), but in the end, couples should decide to get married somewhere that feels special to them. The importance of the day is all about the two people saying ‘I do’. It could be where they live now or used to live, where they met, or somewhere they’ve always wanted to go. The venue fees, of course, need to fit within the budget, and planning a wedding from afar is something that needs to be specially considered as it can add another layer of planning and budgeting.
  • What tips do you have for a couple planning a wedding and hoping to stay on budget?
    • From personal experience, my tips would be:
      • Do your research before committing to anything
      • Look into multiple vendors for each piece you plan and read reviews! Wedding sites like The Knot and WeddingWire have great resources on their websites with lists of vendors in your area complete with reviews from real couples who used the vendor’s services
      • If you plan a budget, stick to it! If you absolutely can’t stick to the budget for one category, see if you can adjust the budget elsewhere to make up for it. It can be very easy to let one thing slide through over budget…and then continue to do so time after time. Before you know it the whole budget is blown. And that only adds stress to planning a very special day. So set a budget and do your very best to stick to it and hold your partner (and anyone else helping to plan your wedding) to it!
      • Have fun! The amount of planning can get stressful, but keep in mind the purpose behind the day and it is all worth it.
  • Weddings can often be an economic boost to local businesses. What measures can local authorities undertake in order to stimulate weddings in their respective communities?
    • I was a bit stumped for ideas on this one so I spoke with my coworker, Lauren Vitt, who recently got married and she had a great idea. Local authorities could stimulate weddings by organizing a way for couples to get discounts on their wedding venue rental if they use more than a certain number of local businesses for their wedding needs (i.e., wedding dress shops, alterations, florists, bakeries, etc.). This would require some definitions as to what businesses are considered ‘local’, but any offer to help couples cut costs is going to be enticing!

Read the full article on WalletHub: 2017’s Best Places to Get Married.

Reviewing the Benefits: Renting and Buying

Financial Planning, Yeske Buie Millennialon February 8th, 20172 Comments

Written By: Lauren Stansell, CFP®

We have frequent discussions with Clients asking whether they should rent or buy – they may be asking for themselves, for their aging parents or for their children or grandchildren. As with almost every strategic planning opportunity we discuss with Clients, there are many factors to be considered. The monthly costs of a mortgage payment that adds to your equity versus a rent payment are what often come to mind first, and most times we hear that a mortgage payment will be less than a monthly rent payment so buying must be the answer. But there’s more to consider for the potential homebuyer – where do you see yourself in five years? Are you planning to relocate or look for a new job? Start a family? Have family members come to live with you? Are you looking to downsize? How do you feel about home maintenance? What does your emergency fund look like? The questions and tradeoffs are plentiful – and that’s why we’re here: to help you think about the many different tradeoffs and ‘walk it around the block’, something we pride ourselves in doing.

In thinking through the choice to rent or buy, here are a few of the many pieces to keep in mind:

Near- and Long-Term Plans and Goals
  • One of the most important roles of our job as financial planners is to help our Clients recognize their unique goals and create policies to help them use their resources in ways that support these goals. Accordingly, it is imperative to consider the benefits of renting and buying in conjunction with your overall goals to ensure you make the best decision for you.
  • As you think about your near- and long-term plans and goals, ask yourself questions like the following: where do you see yourself in the next one to seven years (or more)? Do you know you want to stay in the same location long-term? Or do you think you might consider moving or getting a new job? Do you want the flexibility of having that option? Do you not yet know what your plans may be?
    • It’s hard to say for sure what may transpire in the future, but in cases where general desires and plans aren’t yet known, it likely makes sense to rent to provide you with flexibility until you figure out your plans.
    • If you know that you would like to stay in the same place long-term and the idea of home ownership is appealing, however, buying may be your favored option.
Flexibility
  • To expand upon the notion of flexibility, the ability to have fluid living arrangements is one of the advantages to renting that often goes unacknowledged or unappreciated. As a renter, you can pretty much pick up and move whenever you want or need to. There are, of course, some expenses to getting out of a lease early, but these expenses are often lower than the time, money and energy required to sell a home.
Upfront Costs
  • Just as there are associated costs with getting out of a lease or selling a home, the costs of securing a home should also be considered when making your decision. A down payment on a home (in addition to realtor fees and closing costs) is no small expense compared to a security deposit for an apartment.
  • Furthermore, with expensive housing and rental prices in many areas of the country, it can be difficult for someone to rent and save for a down payment at the same time – or at least it takes longer to save enough.
    • This is likely one reason that we’re seeing a shift away from buying in the millennial generation. According to the Zillow January 2016 Housing Confidence Index (quoted here in USA Today), between 56.9% and 65.3% of people surveyed associate owning a home with the American Dream (the highest percentage belonging to the millennials interviewed), but only 9.2% of millennials surveyed expected to buy a home within a year.
  • Nevertheless, if owning a home is a personal goal of yours, the down payment is certainly something that can be saved up for or planned for, or perhaps funded from the proceeds of selling your prior home – it doesn’t have to derail your financial plan!
Monthly Budget & Maintenance
  • In addition to the initial down payment or security deposit, there are, of course, other monthly costs and payments to consider. Rent payments and mortgage payments are known and stable costs in general, so in both cases you can plan your budget around these known costs.
  • The difference comes about when we think about potential maintenance and repair costs. When renting an apartment, the landlord takes care of (both physically and monetarily) most maintenance expenses, from replacing a broken appliance to painting the exterior of the building. When you’re the homeowner, you’re the landlord. You must either find contractors to complete projects or complete them on your own time. Neither option is “right” or “wrong”, but it’s important to ask yourself – do you enjoy being handy and taking on home design projects or would you prefer that someone else be responsible?
  • Another monthly cost to consider is insurance – renter’s insurance is generally much cheaper than homeowner’s insurance. Of course, this shouldn’t be the determining factor in your decision, it is simply something to be considered and planned for.
Equity and Ownership
  • One of the most common arguments in favor of buying over renting is that all of these costs are an investment into your home equity rather than payments to a rental agency. For some, the other benefits of renting outweigh this disadvantage but for others, building equity by owning a home is a personal goal to take great pride in! Additional well-known benefits of home ownership include the ability to fully customize the space to your liking and to enjoy any price appreciation in the home if or when you sell it.
Tax Deductions
  • Finally, one of the big points we hear from Clients in this conversation is related to the tax deduction for mortgage interest. Based on your tax situation, the deduction could certainly be a great advantage. But, we don’t believe it should be the biggest or sole factor in the decision. As we like to say – we don’t want the tax tail to wag the investment dog (or decision dog).

In summary, there are many things to discuss and consider when you’re wondering whether to rent or buy. And all of these discussions depend on you, your situation, and your desires, goals and Live Big® dreams. Financial planning is all about tradeoffs, and we love discussing them with you! So, if you would like to ‘walk it around the block’ on this topic or any other, we would be happy to schedule time to talk.

Weighing Bucks and Benefits

Yeske Buie Millennialon January 26th, 2017No Comments

Written By: Russell Kroeger, CFP®

Considering a job offer, or comparing a number of offers, can be a daunting task. The trick is not to evaluate them in a vacuum or even solely one against another, but as it relates to everything going on in your life. Let’s assume there is something intrinsically compelling about the opportunity in front of you, so we’ll step past that to address common areas of exploration.

Salary

The obvious reason it is important to consider your starting salary is because you don’t want to miss out on valuable income in your first year. However, it is important to consider that raises, and often bonuses, are generally based on your current salary (i.e. 3% raise to help with the cost of inflation) and can also significantly impact how well your 401(k) works for you. 401(k) deferrals and the employer match are also dependent upon your current salary. This means your ability to take advantage of the opportunity for additional compounding within your tax-deferred account can have a significant impact on the long-term.

To use round numbers, consider the following example as an illustration of the impact salary can have on an individual’s overall financial situation:

Employee 1 has a starting salary of $90,000 and Employee 2 has a starting salary of $100,000. They both get annual raises of 3%.

In 10 years, Employee 1 is earning $117,430 – an income which Employee 2 exceeds by the end of year 7. What starts as a $10,000 difference in salary grows into more than $13,000 by year 10! Consider that impact over the span of a 30 year career, or when looking to switch companies, and the decision whether or how much to negotiate can have long-term ramifications on your cash flow.

Now, using the same employee situation detailed above, consider the impact to their 401(k) balances over 10 years if they both defer 10% of salary and get a 3% employer match. Also assume the account balances grow at 6% annually.

Because the 401(k) account balance also reflects employer contributions in addition to an annual growth rate of 6%, the impact is much more significant than the difference in salary. Beyond the impact of the difference in cash flow afforded by the higher salary, Employee 2’s 401(k) balance is nearly $19,500 more ($193,670 v. $174,300) than that of Employee 1’s balance at the end of 10 years.

Fringe Benefits and Other Perks

Before jumping into a salary negotiation or picking a job with the highest salary with “money blinders” on, it is important to understand all of the other perks of your offer. Being mindful of those other benefits can serve as a negotiation tool; everything you receive, from the employer’s perspective, is included in your “total compensation” even though it may not make it directly into your wallet.

Medical Insurance

  • What does your current job offer in terms of Health, Dental, Vision, Life, or Short- and Long-term disability Insurance coverages?
  • Do the plans offered compare favorably to your current coverage in terms of price and choice of providers?
  • If the coverages recommended for your financial plan are not offered by your employer, it may require securing a personal policy or making changes to your financial situation to ensure the resiliency of your financial hygiene (i.e. increasing your emergency fund to cover gap in an insurance policy with a higher deductible).

Higher Education Assistance or Additional Skills Training

  • If you have plans of enhancing your talents through formal education or a training program, is there any flexibility with your potential employer offering financial support?
  • Have you considered the potential tax impact of employer-provided financial support for additional formal education or training?
  • Are there opportunities to attend conferences, or travel that may be appeal and provide opportunities for a different work experience?

Stock Options

  • Does your potential employer offer discounted opportunities to buy company shares?

Vacation and Flexible Work Policies

  • How do the vacation policies compare to those of your current employer? What about opportunities to work remotely?

Additional Perks

  • Is childcare provided or is a benefit offered to help supplement cost? Is maternity leave provided and/or encouraged?
  • Are stipends provided for a smart phone, gym membership, or vehicle/transportation costs?
  • Will you have access to food and beverage throughout the day that may impact your need to purchase your morning coffee or afternoon snack?
  • Are there personal development opportunities such as mentorship programs or business/life coaches?

Awareness of everything being offered may offer a helpful perspective compared to simply weighing salary figures. Everything you receive within a job offer may not come in the form of money – which, depending on the structure of the benefit programs, may be more beneficial from a tax standpoint than if you were to receive the income and pay for those benefits out of pocket.

Evaluating all of these trade-offs is where the nuances of who you are and what is important to you manifest themselves in your decision-making. We can help you think through the trade-offs to make sure that you are equipped with the knowledge to establish authentic priorities and are confident when having conversations with potential future employers.

New Year’s Financial Resolution

Financial Planning, Yeske Buie Millennialon January 11th, 2017No Comments

Written By:Zach Bennedsen, CFP®

Don’t Look! (at the tickers)

The first resolution we encourage you to take on this year should be the simplest, as it actually requires no action! All you have to do is not look at what the stock market is doing. Day-to-day market activity can be both exciting and terrifying, especially when you listen to the talking heads on CNBC. However, when you’re just looking at daily snapshots, the tickers don’t have much of an effect on your personal financial well-being. So, if those numbers don’t affect you, don’t look at them! The brain power you expend getting riled up about short-term market activity is better applied elsewhere.

Pay Yourself First

If your current savings plans is “I save whatever is left at the end of the month,” this resolution is for you. Instead of spending first and saving later, create a systematic savings plan for 2017. By designating a certain amount for savings every month, or every paycheck, you will be much more likely to meet your savings goals. One of the best ways to create a “pay yourself first” plan is to establish an automatic payment straight from your paycheck to your investment account. The plus side of this is if you never see the money in your checking account, you are less likely to miss it!

Reward Yourself

Have you ever enthusiastically started a strict diet plan only to relapse into old habits after a short amount of time? Establishing new habits is hard, and it can be even harder if you are too strict with yourself. This phenomenon is not limited to health goals; it can happen in your financial life as well. To combat burnout, if you meet your savings goal for three months in a row, treat yourself to that new thing you’ve been ogling. We’re not preaching asceticism here, just healthy financial habits! And just like it’s ok to indulge in that piece of cake every once in a while if you’re meeting your health goals, you can likewise reward yourself for staying on track financially.

Think Personal

When you make a New Year’s resolution, it is personal in nature. No one’s resolution is for everyone in America to start going to the gym. Your financial resolutions should be personal as well. You can’t have a resolution for the S&P 500 to go up by 10%, but you can have a resolution to save 10% of your salary. Control what you can control, and don’t sweat the rest.

Think Long-Term

While we suggest you adopt these resolutions for 2017, these are habits you should maintain past the end of the year. If you set a weight-loss goal, you don’t go back to eating cheeseburgers for every meal as soon as the scale reads your target number. Just like dieting is really about setting new eating habits that you can stick with, these New Year’s financial goals are designed to be sustainable. Financial health is a long-term endeavor, and you will be rewarded over time for establishing good habits now.


“Our deepest fear is not that we are inadequate. Our deepest fear is that we are powerful beyond measure. It is our light, not our darkness that most frightens us. We ask ourselves, Who am I to be brilliant, gorgeous, talented, fabulous? Actually, who are you not to be? Your playing small does not serve the world. There is nothing enlightened about shrinking so that others won't feel insecure around you. We are all meant to shine. And as we let our own light shine, we unconsciously give others permission to do the same. As we are liberated from our own fear, our presence automatically liberates others.” ~Marianne Williamson