Yearly Archives: 2016

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Having “The Talk” with Your Kids

generationsLife is full of awkward, yet necessary, conversations with our kids. We talk to our young ones about chores, drugs, dating, peer pressure, homework and more. Yet many of us avoid talking to our adult children about important topics like retirement preparedness, eldercare and estate planning.

Parents approaching retirement might be pleasantly surprised to know their kids expect to help out with finances, caregiving and estate execution, according to the latest Fidelity Family & Finance Study.  In fact, the research reveals adult children often have their parents’ backs. For example, although 93 percent of parents feel it would be unacceptable to become financially dependent on their children, only 30 percent of children feel the same.

In too many cases, however, children are not aware of their parents’ wishes. Although 92 percent of parents expect one of their children will assume the role of executor of the estate, when asked, 27 percent of the kids identified as filling this role didn’t know this. While 72 percent of parents expect one of their children will assume long-term caregiver responsibilities if need be, 40 percent of the kids identified as filling this role were unaware of it. And though 69 percent of parents expect one of their children will help manage their investments and retirement finances, 36 percent of the kids identified as filling this role didn’t know.

Having “The Talk” with your kids… about retirement preparedness, eldercare and estate planning.

Why aren’t these conversations taking place? The study suggests it may be a matter of timing. About one-third of those surveyed believe frank conversations should occur after retirement and when health and finances have become an issue. At that point, however, it may be too late. These conversations should begin taking place before retirement, and certainly well before any challenges arise.

Are you ready to have “the talk” with your children or parents? If you would like help initiating the conversation, talk with your financial planner for suggestions.

 

By |November 3rd, 2016|Estate Planning, Retirement|

Time for Self-Reflection

Camargo-WEBThe last quarter of the year has arrived, and it will likely pass in a flash as we enjoy the cooler weather and celebrate the holiday season with friends and family. despite the hurried pace of life in the final months of the year (or perhaps because of it), I find it helpful to slow down for a little bit and make time for self-reflection.

I like to take stock of my financial life and goals by considering a series of questions. Perhaps this is because of my profession. Still, the questions I ask myself apply to all of us. Making time for self-reflection helps me feel more grounded and in control of my finances. It also tends to recharge my motivation to work and save and achieve my goals.

If you’d like to give it a shot, here are a few questions and ideas to get you started.

  • How much did I save this year? Could I have done more? How much do I want to save next year? One way to make saving easier is to make it automatic, through direct deposit from your paycheck to your savings or investment accounts.
  • Did the money I spent in 2016 reflect my values and priorities? Make a list of five uses of your money that made a significant, positive difference in your life this year. If you have trouble thinking of five, consider outlining a plan for more purposeful spending in 2017.
  • What are my top three long-term financial goals? Reviewing your goals every now and then can help boost your motivation and drive.
  • How much debt am I taking into the New Year? Take an honest look at the number. If the size of your debt is holding you back from saving for your goals, develop an action plan for reducing your debt next year.
  • What are some poor money habits I can squash? We all have at least one or two. Consider the areas in your life where you can make changes, no matter how big or small.
By |October 24th, 2016|Current Affairs, Financial Planning|

Tax Loss Harvesting for Fall

Eng-WEBAs the weather cools and seasons change from summer to fall, farmers are looking to harvest. Much like the farmer, we at Perspective Financial are turning our thoughts to harvesting – from a financial perspective. Tax loss harvesting, capital gains distributions and required minimum distributions (RMDs) from IRAs are areas of tax planning we review and monitor for our clients throughout the year. During the fourth quarter, we pay particular attention to how these aspects of their portfolios may impact their individual tax situations.


The practice of selling a security that has experienced a loss is called tax loss harvesting.


By realizing (or “harvesting”) a loss, investors are able to offset taxes on both gains and income. The sold security is replaced, at lower cost by a similar one, while maintaining the investor’s asset allocation. We were able to do some tax loss harvesting earlier this year when the markets were very volatile and weak, where it was appropriate for clients with taxable accounts. We continue to look for such opportunities as the year comes to a close.

By |October 10th, 2016|Financial Planning, Investing, Taxes|

Estate Planning and Your Digital Afterlife

McCann-WEBSerious concerns about our “digital afterlife” have emerged thanks to the rapid rise of social media. When the time comes to settle a deceased person’s estate, digital property is a relatively new and growing problem. This type of “asset” simply did not exist 20 years ago. Estate planning and your digital afterlife now go hand in hand.

Digital property is any digital record you own or control – including financial accounts, email, social media, blogs and digital files like music, movies, books and photos. Access to these is limited by the “terms of service” you agreed to when creating an account or buying a product online. Because of privacy laws, many services don’t allow you to pass account control to others upon your death — even if you include it in your will — creating significant legal and emotional challenges for your family.

On the plus side, some companies and services are understanding of the challenges and taking steps to help ease the problem.

In 2013, Google became one of the first major internet companies to put control of data after death directly into the hands of its users. You can now specify what you’d like to happen to your data after you pass away. You can choose to delete data after a certain time period, or to pass the data (from accounts such as Gmail, cloud storage, YouTube, etc.) to a designated person(s). It’s important to note, however, Google doesn’t allow you to pass control of accounts – just the data.

Last year, Facebook (FB) introduced a new feature that lets you choose a “legacy contact” – someone who can manage the memorialized account after your death. You may choose to give that person permission to download an archive of the photos, posts and profile information shared on FB. The legacy contact will not be able to log in as you or see your private messages. Alternatively, you can request that FB permanently delete your account after death.

Until more service providers follow FB’s and Google’s lead, there are steps you can take to protect digital assets.

  • Find out if your service providers have a way of naming a person who can access digital assets in the event of your death.
  • Back up important items from the cloud into some “tangible” form that can be given to your heir(s).
  • Explain to loved ones today what you would like to happen to your digital accounts upon death.
  • Create a comprehensive record of accounts/passwords. Store it in a safe place, and tell your personal representative how to find it.
  • If you don’t want anyone to have access to your online accounts after your death, do not provide them with access. Make account names/passwords difficult to guess, and inform service providers of your wish to have accounts deleted when you pass away.
By |September 26th, 2016|Current Affairs, Estate Planning|