With so much going on ( election, political turmoil, hurricanes), you may have missed the latest in diabetes news this week. Not to worry! We’ve got you covered with the Diabetes Health Weekly Roundup to share the latest news, podcasts …
The post Diabetes Health Round Up appeared first on Diabetes Health.
from Diabetes Health http://ift.tt/2jzvbDe
This crossword puzzle was inspired by this week’s news and podcast reports. Play along with us to test your knowledge and comprehension on topics we post Monday-Friday.
Please click the link below to download this week’s Diabetes …
The post Diabetes Health Crossword appeared first on Diabetes Health.
from Diabetes Health http://ift.tt/2jzz4Ii
Where you fall on the credit score scale is often considered to be a way of determining what kind of person you are when it comes to managing your money.
Lenders – and plenty of others – use your position on the credit score scale to make decisions about how they will treat you in regard to money matters.
The only problem is that many of us don’t know our credit score.
And when you head to one of those websites to get your “free credit score,” it’s really not free, and it’s not your real credit score, it probably makes you pretty frustrated.
I found this out the hard way when I was trying to find my real FICO® Score.
If you’re just as confused as I was, here’s a quick look at determining your credit score scale.
This credit score ranges between 300 and 850, with 300 representing the lowest possible credit score.
However, it is important to realize that this is not the only credit score available.
Other companies use variations of FICO’s formula to create their own scores. Additionally, there are companies out there that have created their own credit score scale altogether. However, for the most part, you are likely to run into some version of credit scoring that uses a model similar to the FICO® Score. (Non-FICO® Scores are commonly referred to as FAKO scores, but they can have some use which I’ll explain in a moment.)
The point of the credit score scale is to allow lenders and other financial service providers (like insurance agents) to immediately ascertain whether or not you are a credit risk. If you have a low credit score, then service providers, like cell phone companies – and even a potential employer – might make assumptions that your level of financial responsibility is low, and that you might prove irresponsible in other areas as well. Clearly, lenders view a low credit score as something that increases the chance that they won’t be repaid the money they lend.
Your position on the credit score scale is usually calculated by using a formula that takes into account the following information (and I included how much emphasis your FICO® Score places on each):
It is important to realize that, even though lenders see your credit score as a big piece of the puzzle, they may also look at other items – such as your income and your employment history – when making a decision.
Your FICO® Score is the one that everyone wants to know: home mortgage lenders, the car loan officer at your credit union, and even your car insurance company looks at some variation of your FICO® Score. Unfortunately, you have to purchase access to your FICO® Score from myFICO unless you apply for a loan and can get the lender to tell you what your score was.
That having been said, keeping track of your FAKO score can still be beneficial. It won’t be as accurate as the FICO score your lender is looking at, but you can track the ups and downs of your credit score by using a FAKO score. Any significant increases or decreases in that credit score would be an indicator to check things out on your FICO® Score.
The most popular FAKO scores include: VantageScore® (a partnership among all three credit bureaus that scores on a 500 to 900 scale), TransUnion’s TransRisk (scored on a 300 to 850 scale), Equifax’s Score Card (scored on a 280 to 850 scale), and Experian’s Scorex PLUS(SM) (scored on a 360 to 840 scale).
As you can see there are several popular FAKO scores and several credit score ranges. This can lead to a lot of confusion as you try to keep track of your score and determine whether or not you have a good credit score.
For the most part, a good FICO® Score depends on the current market conditions. Prior to the financial crisis, a 680 was considered good enough to get a good interest rate on many loans. Now, many lenders want to see a score of at least 720 to offer you the best deal.
Generally, though, a credit score below 600 is considered quite poor. If you score between 650 and 699, you are considered to be in the fair to good range. Some won’t have a problem with you when you have a score of between 620 and 700, but you probably won’t be offered the best terms.
A good credit score can mean more than just a good interest rate on a loan: it can also lead to lower insurance premiums and the ability to qualify to move into a better rental.
A good FAKO credit score varies based on the score you are using. Each score has its own scale which can make comparing it to a FICO® Score challenging. It still holds true that the higher the number, the better your score is. Most of the FAKO credit scores will show you their version of your credit score on a scale in order to show where you fall in the range of poor to excellent credit.
So I’ve convinced you that keeping track of this number is important? Great!
I bet you’re thinking: “But wait . . . what exactly is the best way to track my credit?”
Don’t worry. I’m going to make this as easy as possible for you.
Getting a copy of your credit report used to be difficult. Now it is easy as a few clicks of your browser thanks to the government. The government forced the three credit bureaus to give consumers access to a free credit report from each bureau once every 365 days through a website called AnnualCreditReport.com.
This is just your credit report. When you log in you won’t be able to see your full credit score. However, this is a great starting point because you can look for errors or unfamiliar accounts that might indicate identity theft.
Always start by checking one of your reports at AnnualCreditReport.com.
My two favorite companies to track my scores are Credit Karma and Credit Sesame. Each company will track a credit score for you absolutely free. Unlike other websites that say they are “free” but hit you with monthly membership fees, Credit Karma and Credit Sesame are both absolutely free. (They make money in other ways like offering you a better deal on your mortgage or credit card.)
Here’s a quick comparison of the two:
Either company is a great place to start, but Credit Karma seems to have more options. Whichever route you go being able to keep track of the ups and downs of your credit score is a smart financial move. (Or better yet use both services since they are free and track two different versions of your score each month.)
Okay, if you just checked your credit score and discovered that it stinks, don’t worry . . . there’s hope!
There are a lot of ways you can improve your credit score, and I’m going to show you what works. So don’t freak out. Please.
I would recommend that you make a checklist from this list of tips and systematically check them off as you complete them. Don’t leave anything out. All of these tips may help your situation, so raise your chances of improving your credit score and try them all.
Let’s begin!
A previous intern of mine, Kevin, once had absolutely no clue what his credit score was and had a few lessons to learn.
One of those lessons was that with bad credit, it’s really difficult to get a credit card. In fact, none of the banks he applied with for a credit card allowed him to have one.
But then he got a tip. He was told to get a secured credit card.
A secured credit card has terms that favor the lender much more than the borrower, but the results were astounding.
Kevin, in an article he wrote for GoodFinancialCents.com, explained that secured credit cards are like traditional credit cards, except you have to make a deposit. That deposit is usually the same as your credit limit.
Whoa. Wait a minute. Isn’t that money you can just spend?
No, it’s money that is on deposit should you default on the secured credit card. Now the “secured” part makes sense, doesn’t it?
There are some other details regarding secured credit cards, but for the most part, it’s a great way to build up your credit history – and thus help your credit score.
Using this method and making other smart choices, Kevin showed us how it’s possible to raise a credit score over 110 points in less than five months.
Remember how I showed you how you can look up your credit report earlier in the article? I showed you because it’s important to regularly check your credit report for errors.
These errors can actually be disputed with the credit bureau, so if you do find an error, take advantage of the opportunity to have them correct it.
Sometimes, it’s these errors that are lowering credit scores, so resolving these errors may lead to a better credit score. However, errors are probably not as common as you might hope if you have a poor credit score, so while it’s good to check for errors, don’t give your hopes up thinking this is the best solution for you.
This is a huge part of your credit score. Remember, I said above that payment history has to do with 35% of your FICO® Score, so make sure you always pay on time.
How do you do that? Well, there are a couple of techniques.
YouNeedABudget.com believes you should “age your money.” A practical way to do this is to spend this month’s income next month (or spend last month’s income this month, either way).
How can this help you? Well . . . .
If you’ve ever been in the situation where you can’t pay a bill because you didn’t have the money available to you yet (let’s say you get paid on the 15th but the bill comes on the 12th), you can probably immediately see how this will help you.
By having a money buffer (spending your income much later than you receive it) you’ll be able to make your credit payments when they are due.
But there’s another reason why people don’t make their credit payments: they simply forget!
That’s why it’s a good idea to set up a reminder system to ensure you can’t forget about the bills you have to pay. Do you really think you can remember all of those bills? Of course not! Make sure to have a system in place that works for you.
If you still can’t make your credit payments on time, talk with your creditors to see if you can work out a deal. Perhaps you can lower your payments. Perhaps you can change the payment date. Try whatever you reasonably can to work out a deal so you can start paying on time and transition into good standing with the institutions.
If you have a lot of outstanding debt, that can negatively affect your credit score. Besides, it’s pretty stressful anyway!
One way to keep your credit card balances low is to pay off your debt in a timely manner. Don’t rack up credit card debt. Make sure when you spend money with a credit card, you can actually pay it off at the end of your billing cycle.
Are you taking notes? You should be!
Listen, credit card debt – especially credit card debt that has gotten out of control – can feel pretty crushing. If you’re going to use credit cards, use them responsibility (yes, sort of like alcohol).
If you already have a high amount of debt, you’re going to have to start paying it off. There are some online tools designed to help you pay off debt – use them (some of them were already mentioned in this article).
Also, I have a lot of articles regarding getting out of debt. Find a few articles relevant to your situation and make a determined effort to reduce your debt as much as possible.
You might think to yourself: “You know, if I open up some new cards, I might be able to increase my available credit – thus making what I owe look like peanuts.”
Yeah, it’s a clever idea, but it can actually backfire and lower your credit score. Tricks like these are normally accounted for in the calculation, so thinking that you can fool your way through the system is a bad idea.
Yeah, there are some pretty fast ways to raise your credit score. But you know what? The best strategy is to just make smart choices and take things slow and steady.
By improving your finances as a whole, and making sure you don’t entirely avoid the use of credit, you can get – and maintain – a great credit score.
You see, you need to approach the problem of your poor credit score from a long-term perspective. You might not have the stellar results that Kevin, my former intern, achieved. That’s okay!
Let’s do a quick review of FICO® Score factors that matter (and how they are weighted) . . . .
Remember that 35% of your FICO® Score depends on your payment history on loans and credit cards. Also recall that 30% of your FICO® Score depends on how much of your available credit you are using.
These make up the majority of the factors. So, as you can see, these are largely linked to behaving properly with credit – paying properly and not maxing out your credit cards (for example).
The length of your credit history (15%) is something you really can’t do anything about (unless you don’t have a credit history yet and need to start one). Recent credit inquiries might be something you can affect going forward, but it’s not a huge part of your FICO® Score (at 10%). And, the types of debt/credit you have counts for a measly 10% as well.
Where you fall on the credit score scale matters in a few ways.
However, if you have a poor credit score, please don’t let that get you down.
Remember that there is a lot more to financial health than where you land on the credit score scale. While having a good credit score allows you to sign up for more services and get better discounts, it’s not the end of the world if your credit score stinks.
Think about it. You can still buy things. You can still work hard for your money. You can still function in society. While there may be some financial obstacles to overcome with a poor credit score, it’s not going to destroy you.
Let’s highlight two of the key takeaways from this article:
By monitoring and improving your credit score, you’ll discover better access to credit. It’s not always an easy road, but it’s worthwhile. Which steps are you going to take today to get on a better path? Take them!
The post Credit Score Scale: What is a Good Credit Score? appeared first on Good Financial Cents.
The post Credit Score Scale: What is a Good Credit Score? appeared first on Osiyo Marketing.
from Osiyo Marketing http://ift.tt/1ICYFI6
One in three bites of food depends on pollinators; these images show how bleak our plates would be without our partners in pollination.
The post This is what life without bees would look like appeared first on Osiyo Marketing.
from Osiyo Marketing http://ift.tt/2jZp5uw
from NutritionFacts.org http://www.youtube.com/watch?v=Re9piRz9ny8
Click here to listen to today’s Diabetes Health in the News Podcast!
The challenges associated with operating a hospital are complex and require extraordinary leaders to navigate them. While doctors were previously viewed as ill-prepared for these leadership roles, …
The post Diabetes Health in The News Podcast: Doctors Make the Best Hospital Leaders appeared first on Diabetes Health.
from Diabetes Health http://ift.tt/2jwouC4
It’s a brave new world out there, but we don’t have to go quietly into 1984.
The post Flex your political activist muscles with these resources appeared first on Osiyo Marketing.
from Osiyo Marketing http://ift.tt/2j6ilh8
I know that you were losing sleep because I had not written a post yet that outlines the differences between a 403(b) vs. 401(k).
Oh wait….you weren’t? I thought everybody was a retirement tax code freak like me.
Either way, you or someone you know may have the option to fund a 403(b) and understanding how it compares to a 401(k) may prove to be helpful.
When people are first hired into a full-time job and some part-time positions, they get handed a variety of paperwork and decisions they have to make right away as a new employee. Among those items is the establishment of a company retirement account for their potential retirement savings from earnings.
Most companies today offer employees a standard 401(k) retirement deferred savings plan. However, if a person works for the government or some organizations, like nonprofits, different options can come up, including the 403(b) plan. This raises the question of which is better between a 401(k) vs. 403(b).
A variety of retirement plans exist today, approved by the Internal Revenue Service as legal tax shelters for earnings. In almost all cases, except for a Roth IRA, the plans involve pre-tax income that is deferred to a holding account and allowed to gain profit and interest through compounding and investment.
When the funds are finally withdrawn, usually later in a person’s life, they should – in theory – be part of a larger retirement balance which can be used when a person is no longer working, ergo at a lower tax rate.
This maximizes the value of the dollars saved, even with inflation taken into account. Each of these plans has a numerical name, referring to the tax code statute that authorizes the activity and given plan.
Most people know of or are familiar with the 401(k) retirement plan. But whether you are or you’re not, here are the plan highlights:
Income Tax Treatment. Contributions to a 401(k) plan are deductible from your taxable income in the year they are made. Investment earnings within the account accumulate on a tax-deferred basis. Both contributions and investment earnings become taxable upon withdrawal, and are added to your other income for the year that they are taken. In this way you are shifting the tax burden from today until you retire, at which time you’ll presumably be in a lower tax bracket.
Contribution Limits. For both 2015 and 2016, the maximum contribution you can make to a 401(k) plan is $18,000. If you are age 50 or older, there is a catch-up provision of $6,000, enabling you to contribute a maximum of up to $24,000 per year.
Employer Matching Contributions. Employers can and often do match an employee’s contributions to a 401(k) plan. A typical match is 50% of the employee’s contribution, up to 6%, which means the employer contributes 3%, bringing the total contribution to 9%. There is often a vesting period for the employer’s contribution, up to five years, after which the total amount of the employer’s contribution is considered “vested” by the employee (it’s then fully the employee’s money). In theory, an employer match – plus the maximum employee contribution – can be as high as $53,000 per year, which is the maximum contribution per employee under IRS regulations.
Withdrawal Requirements. You can begin taking withdrawals from your 401(k) plan once you reach age 59 1/2, and once again, those distributions will be added to your income for tax purposes. If you take withdrawals before turning 59 1/2, you will have to pay an early withdrawal penalty tax of 10% of the distribution, in addition to the regular tax liability that will be owed.
Required Minimum Distributions (RMDs). Like nearly every other type of retirement plan (except Roth IRAs), 401(k) plans require that you begin taking withdrawals from plan no later than when you reach age 70 1/2. If you don’t withdraw an RMD, don’t withdraw the full amount of the RMD, or don’t withdraw the RMD by the applicable deadline, the amount not withdrawn is taxed at 50%.
401(k) Loan Provisions. One of the benefits of a 401(k) is that you can take a loan against your account, as long as it is permitted by your employer (they aren’t legally obligated to do so). You can borrow out up to 50% of the plan value, up to a maximum of $50,000, and must repay the loan within five years. However, if a 401(k) loan is taken for the purpose of purchasing the employee’s principal residence it can be paid back over a period of more than 5 years.
One thing to be aware of however is that if you leave your employer and you still have a loan balance outstanding, you must pay it back (within 60 days), otherwise it will be considered to be a distribution from the plan, and subject to regular income tax and, if you’re under age 59 1/2, the 10% early withdrawal penalty.
401(k) Portability and Rollover Provisions. If you leave your employer, you can take your 401(k) with you. You can then do a tax-free rollover either into the 401(k) plan of your new employer, a traditional IRA, a 457 plan, a SEP IRA, or a 403(b) plan. You may also rollover a 401(k) into a Roth IRA or a designated Roth that’s part of a traditional retirement plan (for example, a Roth 401(k) ), but the amount of the rollover will be subject to regular income tax in the year that the conversion is completed. (See IRS Rollover Chart for rollover summary details).
Note that rollovers can only be done after you’ve left the employer who sponsored the original 401(k) plan, and not while you are still employed.
Investment options in 401(k) plans run the gamut. In some plans you may be limited to a half-dozen mutual funds or ETFs, and your employer’s company stock. In others, you’ll have as many options as the plan trustee has available.
For example, if the plan is held with Fidelity, chances are you’ll be picking from a selection of Fidelity funds. That will likely income a selection of target date funds. Blah! In case you didn’t know, I’m not a big fan of target date funds, but that’s a story for a different post.
403(b) plans are very similar to 401(k) plans, except that where 401(k) plans are sponsored by for-profit businesses, 403(b) plans are for not-for-profit organizations that are tax exempt under IRS Code 501(c)3. That includes educational institutions, school districts, governmental organizations, religious organizations and hospitals.
Those with 15 years of service to an employer can then add another $3,000 to their annual contribution limit, depositing a potential $21,000 per year in 2015 or 2016, or $27,000 if they’re over the age of 50. This is called the maximum allowable contribution, or simply MAC.
Unfortunately, just because MAC is allowed under the IRS code does not mean the employer has to honor it. They have to include it in their plan document for it to go in effect. I had a client that met the 15 year requirement but since she was one of the only ones that did, her employer wasn’t aware of the MAC rule and didn’t feel the need to include it in their plan.
Most 403(b) plans provide a choice of mutual funds or annuities for investment of saved funds. Ever since their was a shakeup in the 403(b) market a few years ago, I’ve seen quite a few mutual fund companies pull out. That means you’re seeing a lot more insurance companies offer some sort of annuity product in the plans. Personally, I’m not a big fan of this.
403(b) accounts typically appear in non-profit organizations, churches, school organizations and government. There is a significant administrative difference from a 403(b) as eligible organizations have less paperwork to file with the IRS versus under a 401(k) plan. Because the 403(b) plan is cheaper to administer as well, it’s favored by small entities with tight budgets but still wanting to offer workers a retirement perk.
Is one plan better than the other? In some respects, yes. But in most regards they’re the same plan, with the 403(b) plan serving the same purpose for government and nonprofit employers that the 401(k) plan does for profit generating employers.
The two areas where the differences are the most significant are with investments and the MAC. Investment options are generally more numerous with 401(k) plans, particularly if the plan trustee is one of the major investment brokerage firms that offer something close to unlimited investment choices.
But the MAC provision is a definite plus in favor of the 403(b) plan. It enables long term employees to make higher contributions, even in addition to the catch-up provisions that are normally offered to participants who are age 50 or older.
Both plans offer employees a significant ability to shelter income from taxes and save for their retirement, regardless of the differences between the two. In some cases, employers even provide a match to employees, depending how much they deposit from their own money. This match is essentially free dollars everyone should take advantage of as much as possible when available. That said, depending on the employer, a different plan type will be available. Few employers offer both types of accounts.
The post 403b vs. 401k: What’s the Difference? appeared first on Good Financial Cents.
The post 403b vs. 401k: What’s the Difference? appeared first on Osiyo Marketing.
from Osiyo Marketing http://ift.tt/2j9m9hM
One scientist believes that these plant-like bivalves could build much-needed food security in aquaculture.
The post Are mussels, clams and oysters the most ethical seafood? appeared first on Osiyo Marketing.
from Osiyo Marketing http://ift.tt/2kp8jVA
Old, out-of-date maps are resurrected as soaring birds in these delicate compositions.
The post Paper artist’s flocks of winged wildlife are cut from vintage maps appeared first on Osiyo Marketing.
from Osiyo Marketing http://ift.tt/2k4GuUK
The post An Edible Backyard in an Eichler Home appeared first on Osiyo Marketing.
from Osiyo Marketing http://www.youtube.com/watch?v=qNMdJPvME5w
The post Create a Living Arrangement for Your Tabletop appeared first on Osiyo Marketing.
from Osiyo Marketing http://www.youtube.com/watch?v=1pomzjWj2H4
It’s tax filing season once again, and there are smart tax moves that financially successful people always do.
There are some that you may have already done – or can still do – for 2017.
But for those that can’t be done for this tax year, you can begin positioning your tax situation for 2017 right now.
Here are seven of those tax moves.
Plus don’t miss the exclusive offers that I’ve teamed up with Turbo Tax to bring you. Because whether you’re using a CPA for sorting through it all and filing solo, you should get assistance of some sort.
The IRS tax code is a veritable labyrinth of rules and regulations, so you will need some sort of support in getting the job done right, and with the lowest possible tax liability.
You’ve probably heard that having a big tax refund is like giving the government an interest-free loan. And even though it’s something of a cliché, it’s actually true!
While a lot of people are excited over the prospect of getting a big fat income tax refund, the reality is that you probably have much better things to do with the money. For example, you might invest it to earn even more money.
Or you might use it to pay off a credit card that is charging you double-digit interest rates. Either use of the money would be better than allowing the government to accumulate it with no benefit to you.
In truth, good tax planning is all about coming as close to zero with your tax liability/refund as possible. Though it’s unlikely that you can plan your tax liability/refund to come out to exactly zero, getting to within a couple hundred dollars is an excellent strategy.
Make sure that your withholding or your tax estimates (if you’re self-employed) come as close to your expected tax liability as possible, without substantially exceeding it.
A lot of taxpayers are worried about owing tax, but there’s actually quite a bit of flexibility there. As long as you pay in at least 90% of your actual tax liability, you won’t get a penalty for late payment. Another penalty avoiding strategy is to make sure that you pay in enough tax to cover 100% of the previous year’s tax liability.
Either way, you will have at least most of your tax liability paid, without having to incur IRS penalties for late payment.
For most taxpayers, making contributions to a tax-deferred retirement plan is the single biggest and best way to lower your current tax liability. And not only does the contribution lower your current tax bill, but it also enables you to build up investment capital that will earn tax-deferred income for your retirement. In short, it’s the best investment deal available. For that reason, you should take advantage of it to the greatest degree possible.
For both 2016 and 2017, you can contribute to $18,000 into a 401(k), 403(b), 457, or Thrift Savings Plan (TSP). If you are age 50 or older, the contribution can be as high as $24,000.
Over and above an employer-sponsored retirement plan, you can also contribute to a traditional IRA. You can contribute up to $5,500 per year, or $6,500 per year if you are age 50 or older. Even if you are covered by an employer plan, you may still be able to make a tax-deductible contribution to a traditional IRA.
How effective are tax-sheltered retirement plan contributions at reducing your tax liability?
Let’s say that you’re in the combined 30% tax bracket, assuming 25% for federal, and 5% for your state. If you can contribute the full $18,000 into an employer plan, plus $5,500 into a traditional IRA, you will be able to reduce your taxable income by a total of $23,500.
If you have a marginal federal and state tax rate of 30%, a $23,500 contribution to both a 401(k) and a traditional IRA will reduce your tax bill by $7,050!
You can make a tax-deductible contribution to a traditional IRA, if you qualify for the deduction, up until the tax filing deadline (either April 15, or October 15 if you file an extension). 401(k) contributions have to be made by December 31 of the actual tax year, so you can’t change your contributions for 2016. However you can make adjustments now to max-out your contributions for 2017.
The tax code provides a generous tax break for long-term capital gains, in the form of a reduced tax rate. Short-term capital gains, which are gains on assets that have been held for one year or less, are taxable at ordinary income tax rates. Long-term capital gains – gains on assets held over one year – have lower rates.
Long-term capital gains tax rates look like this:
The moral of this story is obvious: long-term capital gains good, short-term capital gains bad – at least when it comes to income taxes!
Tax-loss harvesting isn’t a new concept, but it’s gaining popularity now that some investment platforms, such as Betterment and Wealthfront, offer it as a feature as part of their programs. But just about any investor can take advantage of tax-loss harvesting. And it can make a big difference when you are filing your income tax returns.
Tax loss harvesting is basically a strategy in which you sell certain investments at a loss, in order to offset the tax liability created on other investments that are sold for large gains. Since capital gains taxes do not apply to tax-sheltered retirement plans, the strategy is used only with regular taxable investment accounts.
For example, let’s say that you have $20,000 in capital gains on a group of winning investments. You can reduce the tax liability from those gains by selling off other investments that have been falling in value. Those losses will offset at least some of the gains that you made on the stronger investments.
You may even consider buying back the investments that you sell for tax-loss harvesting at a later date. The IRS does impose “wash sale rules” that are designed to prevent the abuse of tax reduction strategies. Generally, you are not permitted to repurchase the same or substantially identical investment securities within 30 days of selling them. But if you want to buy back the investment, without incurring the wash sale rule, you must defer the repurchase for at least 31 days. But then again, you may just want to use the cash to buy an entirely different investment.
This is another tax strategy that you can implement for 2017, since 2016 is already a done deal as far as capital gains are concerned.
It’s fairly easy to document major deductions, such as mortgage interest and real estate taxes. But it’s a lot more difficult when it comes to deductions that are made up of small, regular expenditures. Examples include medical expenses and charitable contributions.
You can have dozens of co-pays for doctor visits and prescriptions, and lose track of how many and how much. The situation can be even more extreme with charitable contributions. Though you may have a few large contributions paid by check or credit card, it’s also likely to have a much larger number of smaller contributions, such as contributions in church, or to charities soliciting at your door.
It’s best to have either a spreadsheet where you record all of these smaller expenditures, or at least an envelope or file where you store receipts. If you haven’t done either for 2016, make a New Year’s resolution to begin doing it for 2017. It will make next year’s deductions a lot easier to figure out.
We’re not going to go into a lot of detail here, except to say that tax credits are always worth taking because they reduce your actual tax liability, and not just your income.
Some of the biggest tax credits available include:
There are actually a lot more credits available. It’s not always easy or apparent as to what they are, when you qualify for them, or how much you can receive. That’s why you need to get some kind of help in preparing your tax return, in order to maximize those benefits.
Which brings up the next smart tax move…
Hopefully, you’re not still doing your taxes manually! And if you can’t afford the services of a CPA, you’re not rolling the dice on a fly-by-night tax-preparation outfit. There is a happy medium, in the form of online software packages. Not only are they a lot less expensive than paid tax preparers, but they will also guide you in taking all of the deductions and tax credits that you are entitled to.
The most popular package is TurboTax. It’s the most popular because it’s the very best available, and comes with a very affordable pricing schedule. It offers four different plans, based on the complexity of your tax situation. The pricing runs from zero on the most basic plan, to less than $100 for the most comprehensive one.
Whether you use a CPA or a tax software package, you should get assistance of some sort from either. The IRS tax code is a veritable labyrinth of rules and regulations, so you will need some sort of support in getting the job done right, and with the lowest possible tax liability.
That’s what making smart tax moves is all about!
The post 7 Smart Tax Moves That Financially Successful People Always Do appeared first on Good Financial Cents.
The post 7 Smart Tax Moves That Financially Successful People Always Do appeared first on Osiyo Marketing.
from Osiyo Marketing http://ift.tt/2kwA4ut
This soup includes cauliflower instead of potatoes which help give it a nice thick consistency while keeping it really low in carbs. The cream cheese added near the end gives it a creamy rich flavor. If you are in a …
The post Mexi-Chicken & Roasted Red Pepper Low-Carb Soup appeared first on Diabetes Health.
from Diabetes Health http://ift.tt/2kmMxlj
Academics are important, but so is knowing how to navigate the real world.
The post Schools should teach these 5 life lessons appeared first on Osiyo Marketing.
from Osiyo Marketing http://ift.tt/2jSpBKH
For more than a century, playgrounds have played a pivotal yet evolving role in the lives of urban children.
The post A short history of playgrounds appeared first on Osiyo Marketing.
from Osiyo Marketing http://ift.tt/2ktrL2A
from NutritionFacts.org http://www.youtube.com/watch?v=FQjcukHk3KM
Click here to listen to today’s Diabetes Health in the News Podcast!
A new study completed by the American Council on Exercise has examined the dreaded weight loss plateau. Researchers identified a group of “non-responders” – people whose …
The post Diabetes Health In the News Podcast: Integrated Fitness Program Offer the Best Results appeared first on Diabetes Health.
from Diabetes Health http://ift.tt/2khNrQa
The post A Fun, Quirky Tiki Bar Basement in Portland appeared first on Osiyo Marketing.
from Osiyo Marketing http://www.youtube.com/watch?v=LiPImpcVqSM
Annuities get a lot of press, both good and bad. What it really comes down to is that while annuities aren’t recommended investments for everybody, they can be exactly what’s needed for certain investors.
For example, purchasing an annuity is a lot like setting up your own pension plan. Since most workers these days don’t have a traditional defined benefit pension, an annuity can be the perfect replacement plan.
Another major benefit is that they enable you to increase the amount of money that you are saving for your retirement. That’s because virtually every tax-sheltered retirement plan available limits the amount of money you can contribute.
For example, most workers are limited to an $18,000 annual contribution to a 401(k) plan, or $5,500 to an IRA. But if these contribution amounts aren’t sufficient, you can use annuities to make a difference. That’s because there is no dollar limit on the amount of money that you can contribute to an annuity.
Annuities may be the perfect investment vehicle for a person who is approaching retirement but doesn’t have enough retirement savings.
But annuities come in different shapes and sizes, so you’ll have to get annuity quotes to make sure that you are investing in the right plan.
There are five major annuity types.
A fixed annuity is exactly what the name implies. It’s an investment plan in which the insurance company agrees to make fixed income payments to you the under the terms of the annuity contract. With a fixed annuity, you can earn a stable rate of return on your investment. In a way, it’s a perfect investment solution for a retiree, since it effectively creates a traditional pension equivalent for the growing number of retirees who don’t have one.
Fixed annuities are similar to certificates of deposit, and other fixed income, stable value investment vehicles. Your investment pays a fixed rate of return throughout the term of the annuity – which can literally be the rest of your life.
Fixed annuities, and really all annuities, are really customized investments. For that reason you will have to get annuity quotes from various insurance companies in order to determine which will be best for you.
You can invest in a fixed annuity that will provide you with immediate income. But you can also include it in a deferred income annuity (see below), which will allow it to accumulate investment income, to provide you with an even higher income in the future.
Like CDs, fixed annuities also come with early withdrawal penalties. Those penalties can be much stiffer than the kind that you will pay on a CD. When it comes to annuities, early withdrawal penalties are referred to as “surrender charges”. They can amount to several percentage points of the value of your annuity, and typically work on a sliding scale. For example, you might be subject to a 5% surrender charge if you withdraw funds from the annuity in the first year. That may drop to 4% in the second year, and down to as low as 1% in the fifth year, before disappearing completely.
If you set up a fixed annuity as a deferred income annuity, where it accumulates investment income, you may also be subject to the IRS 10% early withdrawal penalty on the income portion. This is because the interest accumulation on the annuity is tax-deferred, similar to a retirement plan – which is actually one of the major advantages annuities provide.
Some of the more notable benefits of a fixed annuity include:
Variable annuities “can” offer an investor a chance to earn higher rates of return than what are available on fixed income investments, including fixed annuities. They provide investment participation in both stocks and bonds, which is why the returns are higher. But at the same time, there is also the possibility of loss of principal due to declines in the financial markets.
The money within a variable annuity is invested in sub-accounts, which are basically insurance industry mutual funds since they are not listed on public exchanges. The sub-accounts are invested in stocks and bonds, including various specific industry sectors. The specific mix of sub-accounts will depend upon the income desired. And once selected, they will be professionally managed so that you will have no involvement or concern in the management of your annuity.
Variable annuities are typically deferred, so that you can increase your investment in the plan to produce a higher income when you finally begin withdrawing income payments. Again, like retirement plans, the investments grow on a tax-deferred basis. You can set up a future date when you will begin receiving income, which could be your retirement or some other date.
The returns on variable annuities are neither fixed nor guaranteed, since they depend entirely upon the performance of the financial markets. They also come with limitations as to when you can withdraw money from them. Though you will have to get annuity quotes in order to determine the frequency, you will typically be limited to one withdrawal per year, so long as it does not occur within the surrender period (that’s the designated time period when the annuity is expected to grow before making income payments, generally about 10 years).
Some of the more important benefits of variable annuities include:
This may be the most desirable type of annuity for the largest number of people. It’s a type of fixed annuity, except that it uses different methods for creating income within the plan. While fixed annuities concentrate heavily on protection of principal and stable returns, fixed indexed annuities attempt both objectives, but also provide participation in rising financial markets.
Like fixed annuities, fixed indexed annuities also provide an annual guaranteed minimum rate of return. But you can also get the returns provided by investment in a specific stock index. The insurance company will then give you the benefit of the higher return between the two. This gives fixed indexed annuities stock market participation on the way up, but protection against market declines.
There is a limitation on market gains that insurance companies use to offset market declines. They impose caps on the amount that you can earn through stock investments. For example, if the annuity caps your annual stock return at 10%, but the market rises by 15%, your earnings will be limited to 10%. In addition, you typically will not receive dividends paid by the stocks held within the index fund.
Once again, the specific details of these terms will depend upon your annuity quotes, so you’ll need to ask questions, and take plenty of notes.
Some of the specific advantages of fixed indexed annuities include:
An immediate annuity is a type of annuity that is setup to provide you with an immediate income. You invest money in the annuity plan, and it begins making income payments to you as early as the following month.
Immediate annuities are sometimes referred to as single premium immediate annuities, because you make the upfront investment (the “premium”, in insurance terminology), and then begin receiving benefits (income payments). For this reason, they are generally set up at retirement.
The payout terms vary based on the immediate annuity contract. You can have them paid out for a specific period of time, such as 20 years, or set them up so that you will receive payments for the rest of your life. This is all information that you can get upfront when you obtain annuity quotes.
Some of the more interesting benefits of an immediate annuity include:
Sometimes referred to as a longevity annuity, a deferred income annuity is a plan that you start and fund, and then allow it to grow through the accumulated investment income. In this way, they work similar to retirement plans, except that you generally make the investment in a lump sum, rather than through annual contributions.
The term of the deferral is completely up to you. You can invest money in the plan, and begin receiving income payments as little as a year later. Or, you can invest in the plan, and begin taking income payments when you retire in 20 or 30 years. Once you begin receiving your income payments, they can be set up as a guarantee lifetime income.
The specific investment terms can be provided through annuity quotes. But they generally come with a fixed rate of interest, that may be guaranteed by the insurance company for as long as 10 years. At the end of that term, there will be a reset – which could occur as often as annually – that will establish a new rate of interest, based on then-prevailing market factors.
The insurance company will also often offer a minimum rate guarantee for the life of the annuity, so that you will always receive at least that rate of return. And naturally, the longer the deferral term of the annuity, the higher the value of the plan, and the higher your income payments will be.
Deferred income annuities offer the following benefits:
Those are the five major categories of annuities. But each annuity type also comes with a large number of potential “riders” that can offer you enhanced benefits. Those benefits include provisions for guaranteed withdrawals, long-term care, death benefits, and cost-of-living adjustments.
These are all potential add-ons that you can learn about through annuity quotes. Annuities tend to be more complicated than most other investment types, so it will help to work with an insurance professional to guide you through the process. Once again, annuities won’t work for everyone, but it can be the right solution in your particular situation.
The post Finding the Best Annuity appeared first on Good Financial Cents.
The post Finding the Best Annuity appeared first on Osiyo Marketing.
from Osiyo Marketing http://ift.tt/2kq3ZVl
