Financial Trend Blog

When one assesses successful individuals against ordinary individuals there is often more than luck to be thanked for their success. Generally a successful person has a plan and sets both financial and personal goals for themselves. Hiring a personal tax consultant or financial planner might be the best decision you can make for yourself and your family.

Your personal financial planning must be structured in a way that takes external factors into account whilst maximising on what you can do to better your situation. Taking advantage of tax incentives, Investment planning and detailed budgeting can be important elements in maximising wealth and ensuring long-term financial stability.

You don't know what can happen in your future. There are no guarantees in life at all. But, you can do a whole lot more than just hope for the best. You can work toward certain things and build your future as well as you can. You don't know what accidents that might happen or joyous windfalls that you might receive. The best that you can do is think smart and plan ahead for certain scenarios.

Taking care of your personal finances is one of the most important things that you can do to make your future more secure. Financial planning is something that can be learned and should be started early in life with children. This doesn't mean that you need to be cheap and deny yourself. It is simply a way for you to keep yourself in check by having some money put away, little by little.

Financial planning: It pays to start right

Contrary to popular
perception, financial planning involves much more than mere budgeting
and is definitely an exercise which requires expert attention. Given
the immense complexities of life, a complex financial marketplace,
multifarious investment instruments, multiple short term and long
terms financial goals, planning for a safe and worry free financial
future is not an easy job.

There are many steps that go
into the making of an efficient and truly effective , car
loans etc. as soon as possible.

About the author

Introduction

This article will highlight some of the money issues faced by single people and has some practical suggestions for overcoming them. As we will explore soaring property costs, excessive tax burdens, holiday surcharges and illness can all create financial difficulties for single people.

1. Live at Home, Rent or Buy?

Many developed countries including the US and UK have seen soaring property prices. At the same time more and more people are choosing to stay single or get married later in life. In the UK for example, property prices are so high that it is virtually impossible for single people on average salaries or wages to either rent let alone buy a property. Unlike married couples with dual incomes single people are forced into an increasingly narrow set of options.

Recently I shared the heart-wrenching story of a young soldier who had to deal with the unexpected death of his mother. She didn’t have her affairs in order and now her son has the extremely difficult task of recreating her financial details from scratch. Here are some simple steps you can take to ensure that your loved ones aren’t left in a lurch.

First thing you need to do is create a ‘survivor file’ which will contain all of your important financial and personal information. Secondly, you need to tell someone you trust where to find it should the need arise. Maybe you’ve put your will or living trust in a safety deposit box. Perhaps you have a filing cabinet containing your pertinent financial information. Your computer might hold the bulk of your money details.

Q. Jeff, I want to ask your opinion regarding Health Savings Accounts. On April 1st, the company I work for is changing our current Blue Cross health insurance to Guardian Insurance set up as a HRA. I am single and currently have a $500 deductible. Under the HRA, the deductible will be $2,000.

Currently, the premium is split 50/50 between employer and employee. I pay $205.00 per month. Under the HRA it will still be split 50/50, but the employer is going to fund each employee’s Personal Medical Fund up to $900. As I understand it, my responsibility will be $1,100 of deductible before any insurance coverage kicks in. We have not been given any rates for the HRA insurance, but I imagine it will be lower than the monthly $205.00.

How fortunate are the children who grow up financially literate with solid financial values. How much more productive, efficient and enjoyable will their lives be without added financial stress. This topic is certainly an entire book all on its own. Recently there have been some great books, although this is an area of personal finance that could use further development. The following are some key ideas that have been taken from several books specifically on the subject, and adapted to incorporate some of my own thoughts and research from an adult environment.

The importance of having contingency plans for dealing with a financial crisis cannot be overstated. Whilst you may be fit and healthy now, what will happen if you are unable to pay the bills in the future? This article looks at how you can build a financial safety net to deal with unexpected emergencies.

1. Savings and Investments

Savings and Investments are often a good means of building a short term safety net to cope with a short term health problem or the result of redundancy or a career change. Research shows that you should seek to put aside the equivalent of 3-6 months in wages to deal with an emergency. Savings and Investments are easy to access or cash in, should you need some emergency resources and are a great short term safety net.

There are folks who are willing to sell a living trust to anything that moves. They frequently claim that everybody needs a living trust or two. Well, almost everybody. At the other extreme, there are those claiming that (almost) nobody needs living trusts.

No wonder many of you are confused. So, do you really need a living trust?

A living trust is just one of many different tools in financial and estate planning. But, living trusts can help you achieve goals not possible with other planning tools. At the same time, they require effort, time and resources.

Living trusts can serve you well while you are alive. They can also serve your family members and others you love long after you are gone. Just like with a will, you can provide for distribution of property after death.

Last week I explained in theory how you can legally avoid paying taxes on gifts and inheritances. Avoiding taxes on gifts and inheritances is based on cost-basis. To help you apply this to your situation I want to share some real-life examples of how my clients use these principles to legally avoid paying taxes on gifts and inheritances.

First, let’s briefly review cost-basis. When you receive an asset as a gift and sell it, you are responsible for paying capital gains tax. Capital gains tax is calculated using cost-basis. Cost-basis refers to how much money was invested in an asset. When an asset is sold, the cost-basis is subtracted from the amount received to determine the gain or loss. Your amount of gain or loss then determines how much you will pay in capital gains tax. In other words, you pay tax on the profit.