Legacy planning can be very complicated and that’s why we’re here. We’ll walk you through beneficiary designations, trusts, wills and marital agreements, and we’ll work with an estate attorney to help you develop the appropriate paperwork. But, there’s another kind of estate we believe is even more important, one built not from your coins but from your character. It’s really easy to leave a lasting legacy of kindness. Nearly 60 years ago, Packer quarterback Bart Starr popped in to visit a seriously ill little boy. The visit cheered then 10-year old Terry Winch up and continues to inspire him today. “It was so memorable that, even today, when I meet someone new within an hour or two I’m telling that story,” he said. Back in 1960, Winch suffered a dangerous bout of rheumatic fever that attacked his heart. Initially treated by a local doctor, he later spent three months at Marshfield Hospital and several more months recuperating at home in a hospital bed set up in his parent’s bedroom. “One day I heard a car door slam and I looked out and saw my mom’s boss, Dr. Langdon, walking toward our breezeway, which was not unusual,” Winch said. “But then I heard a second car door slam and I saw Bart Starr coming in with him. As you can imagine, it was overwhelming. The Packers were a force to be dealt with and here he was, standing right next to my bed! So, I’m just not believing what I’m seeing…How amazing that was for a 10-year old kid – that Bart Starr came to his house.” During Winch’s long recovery, he also enjoyed the positive influence of his older brother, Dr. Tim Winch. For a long time Terry wasn’t able to move far from his bed, but he was able to make it to the living room and that’s where Tim taught him how to play piano. Those lessons led… | Read More »
Many people are surprised to learn that Social Security payments can be taxable. In fact, depending on your Modified Adjusted Gross Income (MAGI), you may be taxed on up to 85% of your benefits. Once you reach retirement age, your Social Security benefits are taxed based on your filing status and how much other income you receive. If you file singly and your provisional income is below $25,000 annually, you will not pay taxes on your Social Security benefits. (Provisional income includes gross income, tax-free interest, and 50% of Social Security benefits.) A single filer whose provisional income is between $25,000 and $34,000 will be taxed on up to 50%. Single filers whose provisional income is more than $34,000 are taxed on up to 85% of their benefits. The numbers increase for people who file jointly, with those whose provisional income remains under $32,000 avoiding taxes on Social Security, couples earning a provisional income of between $32,000 and $44,000 taxed on up to 50% and those earning over $44,000 in provisional income taxed on up to 85%. Some states also tax Social Security benefits, although they are exempt from state taxes in Wisconsin and 36 other states. Knowing the difference between qualified and non-qualified money is the key to making the most out of the money you’re earned. Qualified money includes assets you have accumulated but not paid income taxes on yet, for instance, IRA and 401(k) money. Because you won’t have to pay taxes on these assets until you withdraw them, the government requires you to begin doing so when you reach 70 ½. These are called required minimum distributions and you must take them every year or you will be penalized. Additionally, these distributions adjust your provisional income higher, which makes more of your Social Security taxable. That’s one reason to increase the amount of non-qualified assets you have in your portfolio as you get closer to retirement…. | Read More »
In some ways, a healthy retirement relies on the proper choice of preposition. You want to retire to something – a passion or hobby – rather than from something. Want to retire so you can spend more time with your grandchildren? Great. Can’t wait to retire so you can stop working at a job you find uninspiring? Okay, but then what? Rising life expectancies and opportunities for good health have produced a generation of octogenarians who crave activities and may need some additional resources to fund them. That’s why we often recommend that the best retirements sometimes include work. We certainly condone leaving a job you no longer enjoy if you have the financial resources to do so, but, if you have no other plans, consider part-time work in a related field. Work as a consultant, tutor, freelance writer, receptionist or cashier. The wages you earn will help you avoid dipping into your retirement funds, which will give them a better opportunity to grow. Even if you’re very confident you have set yourself up financially for a successful retirement, you still might crave the opportunity to feel useful. In that case, volunteer as a coach, mentor, docent or usher. The idea is to stay active and productive. Give yourself a reason to leave your house, challenge your brain to keep it sharp and allow yourself opportunities for social connections. If you love your job and enjoy your co-workers don’t retire just because your birthdate says you can. Social Security calculates your monthly payment based on your 35 highest wage earning years. Most people earn much higher wages in their later years of employment than they did in their early years. So, the more years you work earning the higher wages, the more lower-wage years you will replace. This will boost your monthly Social Security payment (up to the highest Social Security benefit amount you can receive , which is $2,788… | Read More »
High schools around the country are doing a much better job of providing financial education to students, but the best teaching still occurs in the home. You can start with a simple piggy bank and show your little people how to set a goal and then save to achieve it. By the time they get to grade school, children should understand these basic principles of saving and spending, but they also should begin to understand what it means to invest money in something and how and why people borrow money. Teach them about income and why a good education and training can lead to more. Children should learn how to count money, how to budget, why you should try very hard not to spend more than you make. In later grade school years you can teach them how to manage a credit card and why adults need insurance. By the time they get to middle school your kids are ready to learn about the stock market and how interest rates and inflation affect the value of money. It might be fun to pick out and track a few stocks with them and show them how they can take financial risks to make money. Middle schoolers already experience sales tax, so you can start talking to them about property and income taxes and how to factor them into your purchases and financial goals. Revisit as often as you can the idea of making and keeping a good budget plan and how to avoid paying interest rates and late fees. Talk about insurance and why people need to protect themselves. By high school, many students begin receiving a paycheck, which is an excellent opportunity to drive home the impact of taxes and Social Security on income. Many will also be planning to apply for college and that process also offers a very necessary opportunity to discuss loans, interest rates, budgeting, and your… | Read More »
While it’s the oldest and most familiar index, the Dow Jones Industrial Average is not the largest and, due to the way it weights its companies and to the limited amount of companies it represents, it may not provide the best representation for how the U.S. stock markets are faring. With only 30 stocks, all of them blue chip industrials, the DJIA includes familiar companies like Johnson & Johnson, Coca-Cola and McDonald’s. By contrast, the S&P includes 500 companies with a market cap of $5.3 billion or more. Historically, the Dow and the S&P have been almost perfectly correlated, meaning they move in the same direction on virtually every trading day. Recently, though, the two indices have been tracking differently, with the S&P 500 YTD returns around 7.41% relative to the Dow at 4.28%, according to Factset. The two indices weight their companies differently, with the S&P weighting by market cap, meaning that bigger companies make up more of its value, and the Dow weighting by price, meaning that a change in the price of one stock has the same impact to the Dow as a change in the price of another. The prices are equally weighted on the Dow. A third index we track closely is the Nasdaq Composite, which includes more than 3,000 stocks that are weighted by market capitalization. More than half of the companies listed on the Nasdaq are tech stocks, and, unlike the Dow and the S&P, the Nasdaq includes some foreign-based companies. All three indices have enjoyed unprecedented success in recent years. According to MarketWatch, since March 9, 2009, which marked the low of the financial crisis and which many consider the birth date of the current bull market, the S&P has advanced 320%, the DJIA has risen 290% and the Nasdaq is up has soared 520%.