Tehachapi's Online Community News & Entertainment Guide
Tehachapi's Online Community News & Entertainment Guide
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The movement of the financial markets can seem mysterious - and yet, if we look back over long periods, we can see definite patterns that consistently repeat themselves. As an investor, how should you respond to these market cycles? To begin with, it's useful to know something about the nature of a market cycle and its connection to the business or economic cycle, which describes the fluctuations of the economy between periods of growth and contraction. Issues such as employment, consumer...
It's election season again. Over the next several months, you're bound to hear an array of promises from the candidates and speculation from the pundits on what those promises, if enacted, could mean for the country. But, how might these possible outcomes affect your financial future? When considering this question, keep these points in mind: • Campaign promises aren't always kept. Presidential candidates often proclaim that they intend to institute major changes in tax or spending policies, o...
Losing a spouse is one of the most painful experiences anyone can have. Unfortunately, widows and widowers have to deal with more than just the emotional trauma — they also must consider a range of financial issues. If you’ve recently been widowed, what financial moves should you consider? For starters, don’t rush into any major decisions. If you’re still in the grieving process, you are unlikely to be in the best shape to make significant choices affecting your finances and your life. But onc...
Here’s a sobering statistic: 72% of retirees say one of their biggest fears is becoming a burden on their families, according to a study by Edward Jones and the consulting firm Age Wave. If you are near retirement, how can you prepare yourself to become financially free, so you won’t have to depend on grown children or other family members? Here are a few suggestions to consider: • Keep adding to retirement savings. Today, with a greater awareness of healthy lifestyles, many people are spend...
One of your important sources of retirement income will likely be Social Security - but when should you start taking it? You can start collecting Social Security benefits at 62, but your checks will be considerably bigger if you wait until your full retirement age, which is likely between 66 and 67. You could even wait until you're 70, at which point the payments will max out, except for yearly cost-of-living adjustments. But if you need the money, you need the money, even if you're just 62 or...
March 8 is International Women's Day, a day for celebrating all the accomplishments of women around the globe. But many women still need to make up ground in one key area: retirement security. Women's challenges in achieving a secure retirement are due to several factors, including these: • Pay gap – It's smaller than it once was, but a wage gap still exists between men and women. In fact, women earn, on average, about 82 cents for every dollar that men earn, according to the Census Bureau. And...
When you plan to retire at a certain age, you can follow a strategy that incorporates your investment moves, your health insurance and other factors. But what happens if you're forced to retire earlier than you anticipated? Unfortunately, this situation is not that uncommon. About 40% of Americans say they have been forced into retirement, according to a recent survey from Edward Jones and Morning Consult, a research firm. If this were to happen to you because of a layoff, company downsizing or...
Who knows where the time goes? We've reached the end of another year, so it's appropriate to reflect on the nature of time and how it affects us. And time certainly is a key element in the pursuit of your financial goals. As an investor, time can be your greatest ally. If you hold some investments for the long term, you could achieve an impressive cumulative growth in value. Furthermore, if you keep adding shares to these investments, possibly through a dividend reinvestment plan, you could atta...
If your children are grown and your mortgage is paid off, do you still need to carry life insurance? It depends on your situation, but for many people, a cash-value life insurance policy, such as whole life or universal life, can be a valuable, tax-efficient source of retirement income. And by drawing on the cash value of your policy, you might be able to temporarily reduce the amount you take out from your retirement accounts, such as your IRA and 401(k). This ability could be especially...
Once again, it's the season of generosity. In addition to considering gifts for your loved ones, you might want to think about charitable gifts as well. But what should you know before making gifts to charities? And what impact might these gifts have on your financial and tax situation? First, you may want to create a gift budget by deciding just how much you will give to charitable organizations over the rest of the year. Next, look closely at the groups to whom you wish to contribute. You can...
If you've invested in an IRA for many decades, it may well turn into a key source of income for your retirement. Still, you might not deplete your IRA in your lifetime, especially if you also have a pension or a 401(k) and other investment income. So, if your IRA still has sizable assets after your passing, it would likely end up in your estate plan. If you leave your IRA to grown children or other family members, could they be hit with a big tax bill? Here's a little background: Up until the Se...
Paying for health care can be challenging - but are you taking full advantage of all the resources available to you? You might have access to a Health Savings Account (HSA) or a Flexible Spending Account (FSA), so let's look at both. An HSA is a personal savings account used to pay health care costs. If you're enrolled in a high-deductible health plan, you also may be eligible to contribute to an HSA. You aren't taxed on the money you put into this account or on the earnings generated from your...
If you own a business, you've always got a lot on your mind. But no matter how busy you are today, you need to think about tomorrow. Specifically, you'll want to create an exit strategy for the day you want to move on from your business to a new phase in your life. To develop this strategy, you'll need to address these key questions: • How much do you need (or want) for your business? Ideally, you'll want the sale of your business to meet your retirement and estate-planning goals. So, you'll n...
How long will you live? Of course, your longevity is somewhat unpredictable. But it may be a good idea to plan for a long life - and the financial issues that go along with it. It's reasonable to think you've got a long way to go. In fact, 72% of retirees now think they will live longer than their parents, according to a recent survey from Age Wave and Edward Jones. Their optimism may be justified: A 65-year-old woman can expect to live almost 20 more years, while a 65-year-old man can...
When you're retired, you'll likely have some financial concerns - just like all retirees. However, if you've invested regularly and followed a long-term financial strategy, you should be able to address most issues that come your way. But there's one important action that's sometimes overlooked by retirees: sharing their financial situation with their grown children. And this knowledge can benefit everyone in your family. You might be surprised by the concern your children have for your...
If you save and invest for decades, you'd like to know you can retire without financial worries. Nonetheless, you still have to be aware of some threats to a comfortable retirement - and how to respond to them. These threats include: • Inflation – Inflation has been high recently, but even a mild inflation rate can seriously erode your purchasing power. In fact, with just a 3% inflation rate, your expenses could double in about 25 years - and your retirement could easily last that long. So, if...
Another school year is coming to a close. And if you have young children, they're now a year closer to heading off to college or some other type of post-secondary education or training. So, if you haven't already done so, you may want to start preparing for these costs. And they can be considerable. During the 2022-23 school year, the average estimated annual cost (tuition, fees, room and board, books, supplies, transportation and other personal expenses) was nearly $28,000 for public four-year...
Are you a business owner who has wanted to offer a retirement plan to your employees, but you've been stymied by the costs involved? If so, you may be interested to learn about new legislation that can help open the door to the same type of plan enjoyed by employees of large companies. At the end of 2022, President Biden signed into law the SECURE 2.0 Act, which, among many other provisions, provides tax credits for business owners who want to open a 401(k) plan. The tax credit was introduced...
If you're going to enjoy a comfortable retirement, you should know, among other things, how much money you'll need. And you may have a much better chance of knowing this if you get some professional help. Consider these findings from a 2021 study by Dalbar, a financial services market research firm: • Investors who worked with a financial advisor were three times more likely to estimate what they would have saved at retirement than "do-it-yourself" investors. • More than two-thirds of investors...
We all want to stay healthy and live independently throughout our retirement years. Unfortunately, that won't be possible for some of us, so it's a good idea to be prepared for health-related challenges - such as the need for long-term care. As you may know, long-term care covers a variety of services, ranging from occasional visits from a home health aide to full-time residency in a nursing home. But while these types of care may vary in duration and intensity, they all have one thing in...
Now that it's the holiday season, gifts are probably on your mind – and you might intend for some of those gifts to go to charities. Although your intentions are good, you could be shortchanging both your recipients and yourself with your method of giving. But with some guidance, you can make choices that work well for you and those charitable groups you support. Of course, you could simply give money to these groups. However, by donating other types of assets, can you increase the value of y...
If you receive Social Security, you've probably already heard that your checks in 2023 will be bigger – considerably bigger, in fact. How can you make the best use of this extra money? Here's what's happening: For 2023, there's an 8.7% cost-of-living adjustment (COLA) for Social Security benefits – the largest increase in 40 years. Also, the monthly Medicare Part B premiums are declining next year, to $164.90/month from $170.10/month, which will also modestly boost Social Security checks for...
You can find many ways to support charitable organizations. One method that's gained popularity over the past few years is called a donor-advised fund. Should you consider it? The answer depends on your individual situation, because donor-advised funds are not appropriate for everyone. However, if you're in a position to make larger charitable gifts, you might at least want to see what this strategy has to offer. Here's how it works: • Contribute to the fund. You can contribute to your d...
There are no shortcuts to investment success – you need to establish a long-term strategy and stick with it. This means that you'll want to create an investment mix based on your goals, risk tolerance and time horizon – and then regularly review this mix to ensure it's still meeting your needs. In fact, investing for the long term doesn't necessarily mean you should lock your investments in forever. Throughout your life, you'll likely need to make some changes. Of course, everyone's sit...
You may have heard that you can simplify your investment strategy just by owning index-based or passive investments. But is this a good idea? You'll want to consider the different aspects of this type of investment style. To begin with, an index-based investment is a vehicle such as a mutual fund or an exchange-traded fund (ETF) that mimics the performance of a market benchmark, or index - the Dow Jones Industrial Average, the S&P 500, and so on. (An ETF is similar to a mutual fund in that it ho...
