The day before her 18th birthday, my daughter broke her wrist and needed surgery to repair it. The timing of her injury provided a profound lesson for us both. As we had been her entire life up to that point, her father and I were her legal guardians at the initial doctor’s visit, with full access to the information we needed to make medical decisions for her care. HIPAA kicked in the next day, the moment she turned 18, and medical professionals were no longer able to tell me anything. She had to sign her own paperwork (with her broken wrist) and she had to fill out a release to allow me to attend her medical consultations and surgical appointments. Had she been knocked unconscious in the bike accident that caused her injuries and remained so the following day, her father and I might not have been able to help her make these important medical decisions. To avoid this type of medical limbo, it is very important to complete a Power of Attorney for Healthcare form. This form allows you to designate a health care agent to make decisions for you should you become incapacitated. These rules vary from state to state. For instance, Wisconsin is not a next-of-kin state. This means that if you are ever unable to make your own health care decisions, that ability does not automatically go to your spouse or parents. The HIPAA Privacy Rule does defer to a medical professional’s judgment in these cases, but it is much safer to complete the paperwork to ensure the people you trust have access to the information they need to advocate for your care. Fortunately, the paperwork you need to establish a legal Power of Attorney for Healthcare is readily available and it doesn’t cost anything to fill it out. You can download the Wisconsin form from this site. If you have any questions about your patient… | Read More »
Summer is an important season to pay attention to your health. You need to watch your sun exposure, make sure all that extra sunlight isn’t disrupting your sleep and keep the weight you might gain from those ice cream sundaes under control. It’s also the perfect time to take a look at your financial health. Here are five areas you can analyze to make sure you’re in good financial shape moving forward: Do you have a budget and are you sticking to it? Are you adjusting your budget for inflation? It isn’t enough to spend less than you make, you also need to account for rising costs of essentials like food, fuel, clothing and housing. Are you saving enough for an emergency? Ideally, you should have saved three to six months of living expenses to tide you over in case of an unforeseen emergency like job loss, illness, natural disaster, fire, major appliance replacement or vehicle repair. Are you paying off your debt in the most effective way? The first step is to analyze your debt situation and review the applicable interest rates. Then, set up a payment plan and stick to it. Do you have an income gap and, if so, how will you address it? A retirement income gap occurs when your income stream from Social Security, pensions, and/or rental property is not enough to cover your retirement budget. Before you retire, you need to know how you will cover this gap. Will you withdraw from an IRA? If so, how much can you afford to withdraw without losing principle? Do you have an annuity? If so, what will your start date be to turn on your payment stream? How will taxes impact your retirement budget? It is important to know the difference between qualified accounts, like traditional IRAs and 401(k)s, and non-qualified accounts, like your checking or savings accounts. You will need to pay taxes on withdrawals… | Read More »
Josh Tatum’s infamy straddles three centuries thanks to a financial scheme that apparently netted him $15,000 and inspired the U.S. Treasury Department to recall and then re-design the Liberty Nickel. If you’ve ever used the phrase “just joshing around”, you’ve referred to Mr. Tatum. Young, enterprising and, by some accounts, both deaf and mute, Josh Tatum took advantage of some similarities between the nickels minted in 1883 and gold pieces worth five dollars. Both coins were the same size and had remarkably comparable designs. At the time, the word “cents” did not appear on the nickel. So, as the story goes, Josh enlisted a friend of his to help him electroplate the nickels so he could pass them off as gold. He simply purchased low priced items, paid for them with the nickel that looked like a $5 gold piece and then collected the change. By some accounts, he wracked up more than $15,000 with this scheme, or more than $337,737.00 by today’s standards. Eventually, Josh was caught and charged but not convicted. His apparent defense was that the merchants were responsible for recognizing the value of the coins he handed over to them and, as a deaf mute, he never said anything to mislead them. He said he viewed the extra change he received as a gift. The opportunity to pass these nickels off as more valuable gold coins came and went very quickly. The U.S. Treasury first released the “Liberty Nickels” on Feb. 1, 1883 and, by March 11 of that same year, they began re-casting them with a design that included the word “cents” on them. If you’re planning to celebrate April Fool’s Day by “joshing around”, remember the origin of that phrase and always be sure to double check any financial transactions you make.
If she could have convinced herself of one thing during her younger days, financial advisor Tanya Winch would have told herself to save much more for her retirement and to begin saving earlier. “I regret wasting potential gains on magazines and gum” she said. “Back then, I didn’t understand the magnitude of what compound interest can do. It’s a great theory and it’s completely understandable but behaviorally, it’s not real until you get to a certain point in your life and you say, ‘There’s only so much left in my working life. I’d better get on it. I’d better stop fooling around.’” These days, she’s on a mission to help other young working professionals not only understand how compound interest can boost the money they’ve worked so hard to earn, but also how easy it is to do so. Simply directing a small portion of their paycheck into an account now will lessen their future anxiety about retirement and give them a leg up on feeling great about their money skills. Toward that end, she is teaching a class called “Take Control of Your 401(k)” that will be offered both virtually and in person through the University of Wisconsin Oshkosh – Fox Cities. The two-session series will run on Nov. 2 and 9 from 6 to 7 p.m. You can register here. She wants young professionals to take control of their 401(k) and other retirement accounts and to understand that it’s not that difficult to do so. “I think everyone thinks it has to be a giant amount of money that you put into your 401K) to make a difference, but even if you just put a small amount of your paycheck in you’re going to see a big reward,” she said. “That’s the highest form of self-care and it’s really necessary for both your current and your future self.” While the class will cover 401(k) specifics like what a market cap is and… | Read More »
We’re wrapping up our series of SPF 15 (Sound and Practical Finance) tips with these suggestions for people aged 70 and over. You can check out all our SPF 15 posts on our website. If you have any questions or comments about this series, please feel free to contact us. We’d love to hear your ideas. If you have not already done so, begin taking your Social Security. Up until age 70, Social Security benefits accumulate thanks to delayed retirement credits. So, there is a benefit to deferring Social Security until then. There is no benefit to delaying those payments past the age of 70, even if you don’t need the money right away. Take the payments and reinvest them. Don’t forget to take your Required Minimum Distributions. RMDs start at age 72. This means you must begin taking withdrawals from your traditional IRA, 401(k) or other tax-deferred retirement accounts so you can pay the tax you’ve deferred on them. If you don’t start taking your RMD each year once you reach age 72, you will have to pay an excise tax on the amount not distributed. An immediate annuity may be a good choice for you. The longer you live, the longer you are expected to live. If you have good genes and a healthy lifestyle, then you may want to consider guaranteed income choices that provide income for life. Not all annuities are worth their fees, though, so be sure to run through your options with a fiduciary advisor before your commit to a plan. Move toward less risky investments. Once you reach age 70, you don’t have as much time to make up a loss as you did when you were 30. Check your retirement portfolio allocations with a certified financial planner to make sure they match your risk tolerance. Reassess your risk tolerance. It changes as you age and begin to withdraw from your retirement accounts…. | Read More »