The Time Value Of Money
One well-known fact of economic life is that a dollar received today is worth more than a dollar received a year from now.
Time and Money
The relationship between time and money provides the foundation for virtually every financial decision you will make. Whether you are saving money for a future event or considering a loan to pay for a current financial need, you will be greatly impacted by the time value of money.
Tax Qualified Plans
As a business owner, there are several reasons you might want to implement a qualified retirement plan for you and your employees. Not the least of which is that qualified plans provide numerous tax advantages.
Use Of Living Trusts
A revocable living trust provides financial protection in the event you are no longer able to manage your financial affairs yourself. You can be trustee while you are healthy, but if you have a stroke or become otherwise incapacitated, your successor trustee would manage your assets in the trust.
Calculating Social Security
Social Security was originally introduced in 1935 in the aftermath of the Great Depression. It was intended to provide a safety net of income to retired and disabled workers and their families. Social Security is a mandatory plan, requiring most wage earners to contribute a percentage of their yearly income to support the program. In return, they, their spouses and sometimes their dependents are eligible for retirement, disability and survivorship benefits.
Section 529 College Savings Plans
A 529 plan is a state-sponsored education savings program that allows an individual to save in a tax-deferred account to pay for a beneficiary's post-secondary education at any accredited school in the United States. Unlike Coverdell Education Savings Accounts, which excludes joint filers with adjusted gross incomes (AGIs) above $220,000 and single filers with AGIs above $110,000, there are no income restrictions on those contributing to the plan.
A Living Will
You may recall that during the final weeks of his life, former President Richard Nixon refused "heroic measures" and received only palliative (comfort-easing) care at his home. Similarly, former First Lady Jacqueline Kennedy Onassis refused life-prolonging medical intervention before her death from non-Hodgkins lymphoma. Former President Nixon and Mrs. Onassis both retained control over their final medical care through use of a living will and a health care power of attorney.
Keeping Your Plan In Balance
No matter what type of investor you are, it is important to keep your plan on track. Revisit your asset allocation periodically (every year or two, depending on market conditions) and see whether it needs adjustment. You should also periodically re-examine your risk tolerance and investment profile, especially as you get closer to your goal. You may discover you need to tweak your portfolio’s risk exposure over time.
Using Mutual Funds In Your Portfolio
If you want to invest in the stock market but don’t have a large enough portfolio to achieve the diversity you want through individual stock purchases, mutual funds may provide the solution you are looking for. Mutual funds are a collection of stocks designed to meet a stated investment objective or strategy. For instance, you may be able to choose between a fund that holds small- or mid-sized companies, large blue chip companies, or government bonds. Some funds are designed to provide growth, others to give you income.
