You may have experienced a heat wave this summer. Ours was this weekend, all over New England with temps in the 90s and the “real feel” reaching the low 100s. It was a scorcher. There’s no beating the heat, but going out on the boat is a nice break. In the first video I’ll show you what it feels like to leave Newport at cruising speed, with Castle Hill off the port side, the Newport bridge to stern, and Jamestown, RI to starboard (pardon my finger it was hard to hold the phone). In the next video we’re approaching Mattapoisett harbor. You’ll see Ned’s Point lighthouse off … [Read more...]
Are You Fully Invested?
Do you remember how you felt about your portfolio in December? It wasn’t a happy time for stock investors as they watched values crater. Some investors got out of the market all together and felt much better. But they probably missed this incredible stock market of the first half of 2019. Feeling good about investment decisions is oftentimes not good for your portfolio. Everyone wants to be a contrarian. Everyone wants to be the guy that swims against the tide. The one who chooses her own path. But when "you know what" hits the fan they look for comfort and sell, sell, … [Read more...]
Part II: The IRS is Coming for Your IRA
As you know from my recent post on the SECURE Act, Congress is pulling a fast one on the savers of America. If passed, the “Stretch IRA” will be eliminated for children, grandchildren and other non-spousal heirs. It will require IRAs to be fully distributed (fully taxed) within ten years—no longer over a lifetime. A granddaughter in her mid-20s, for example, will not be able to “stretch” the distributions over her life expectancy and more fully harness the power of compound growth. Anyone and everyone with a tax deferred savings account should be livid. This toxic waste applies to … [Read more...]
Beat the IRS: Roth IRAs for Your Kids and Grandkids
If you have a child or grandchild who is working this summer, you might be able to help them catch FIRE: Financial Independence Retire Early. Help them establish a Roth IRA, and if they’re under age 18 or 21 (depending on your state) set-up a custodial account Roth IRA. They can contribute $6,000 or the total of their earning income whichever is less. For example, if they earn $3,000 that’s their max not $6,000. The key is to have earned income from an employer. It doesn’t matter where the money comes from either. Let’s say your grandchild earns $3,000 for the summer. You may want … [Read more...]
The FIRE Movement by the Numbers
The financial industry is full of anecdotes and stories by writers (myself included) providing their own perspective on events. The FIRE (financial independence, retire early) movement is blessed with many blogs and podcasts discussing the early retirement journeys. But anecdotes never tell the whole story, so I want to give you some numbers on the FIRE movement. These numbers were assembled by a Harris Poll conducted for TD Ameritrade. How Many People Are Aware of the FIRE Movement? 11% Know about FIRE 26% Are familiar with the concept but not the term 63% Are not familiar with … [Read more...]
Captain’s Log from Your Survival Guy’s Fourth of July Weekend
Here are some observations from Your Survival Guy’s Fourth of July weekend, when my family and I took our boat—the Tom Sawyer—to Mattapoisett to visit my parents, and on the way home got stuck in the fog (more on that shortly). Family trips are a little different now than they were a few years ago when the four of us (plus our dog Louis) would travel by boat. This year our daughter had “things” she needed to do, and met us by car. This worked out well since Louis is not a huge fan of the boat. He loves it when it’s at the dock or on a mooring. But when it’s underway, he’s less sure of … [Read more...]
The IRS is Coming after Your IRA with this Hidden Tax
More sausage is being made down in Washington D.C.—never a good thing especially when “revenue” and “IRA” are used in the same sentence. It’s called the SECURE Act, which laughably stands for Setting Every Community Up for Retirement Enhancement. It sailed through the House 417-3 and is expected to pass under unanimous consent by the Senate. The insurance industry loves the Secure Act. Uh-oh. At the heart of their love affair with this foul ball is the introduction of annuities as investment options for 401(k) plans. The reason they haven’t been offered in the past is because … [Read more...]
Cook County Residents Forced from Their Homes
Chicago-area politicians have given their constituents something special this year, a major property tax increase. In a state already near the top for income taxes, residents of Chicago and Cook County are facing property tax bills that have skyrocketed. In the face of property tax bills that have even climbed by 60%, some residents are being forced by the bills to move out of the area. Dana Kozlov reports for CBS: Property tax increases in Cook County are going beyond sticker shock. For some families it’s life-changing, and they say they will have no choice but to move. “This is out of … [Read more...]
How Can You Save Money for Your Grandchild?
The short answer is, early. The earlier you can start saving for your grandchild, the greater the impact you'll have on their life. Take a trip with me. Let’s say you help a grandchild get into the savings game when they’re born by contributing $525 per year to an account you establish for them. (I favor UGMAs for this purpose). You diligently save each year for her first 21 years. Then when she turns 22, she continues along the same path, saving $525 on her own each year until she’s 64. Look at my table below to compare her success to someone who begins his investment savings at … [Read more...]
These Americans Are Never Going to Retire
A poll conducted by The Associated Press-NORC Center for Public Affairs Research found that 23% of Americans don't expect to stop working during their lives. Andrew Soergel writes in The Washington Times : “The average retirement age that we see in the data has gone up a little bit, but it hasn’t gone up that much,” says Anqi Chen, assistant director of savings research at the Center for Retirement Research at Boston College. “So people have to live in retirement much longer, and they may not have enough assets to support themselves in retirement.” When asked how financially comfortable … [Read more...]
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