FINANCIAL FOCUS – Brighten Your Grandchildren’s Financial Future

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Mother’s Day and Father’s Day may get more attention, but National Grandparents Day, observed on Sept. 10, has gained in popularity. If you’re a grandparent, you might expect to receive some nice cards, but if you want to make the day especially meaningful, you may want to consider giving some long-lasting financial gifts to your grandchildren.

What might come to mind first, of course, is helping your grandchildren pay for college. You can choose from several college savings vehicles, but you may be especially interested in a 529 savings plan. With a 529 plan, your earnings accumulate tax free, provided they are used for qualified higher education expenses, such as tuition, books, and room and board. (Keep in mind that 529 plan distributions not used for qualified expenses may be subject to federal and state income taxes and a 10% IRS penalty on the earnings.) You may be eligible for a state income tax incentive for contributing to a 529 plan. Check with your tax advisor regarding these incentives, as well as all tax-related issues pertaining to 529 plans.

One benefit of using a 529 plan is contribution limits are quite generous. Plus, a 529 plan is flexible: If your grandchild decides against college, you can transfer the plan to another beneficiary.

Generally, a 529 plan owned by a grandparent won’t be reported as an asset on the Free Application For Federal Student Aid (FAFSA), but withdrawals from the plan are treated as untaxed income to the beneficiary (i.e., your grandchild) — and that has a big impact on financial aid, a much bigger impact than if the plan was listed as a parental asset. Beginning with the 2017-2018 academic year, however, FAFSA now requires families to report income from two years before the school year starts, rather than income from the prior calendar year. Consequently, it might be beneficial, from a financial aid standpoint, for you, as a grandparent, to start paying for college expenses from a 529 plan in the year in which your grandchild becomes a junior. Contact a financial aid professional about the potential financial aid impact of any gifts you’re considering.

A 529 plan isn’t the only financial gift you could give to your grandchildren. You might also consider giving them shares of stock, possibly held in a custodial account, usually known as an UTMA or UGMA account. One possible drawback: You only control a custodial account until your grandchildren reach the age of majority, at which time they can use the money for whatever they want, whereas distributions from a 529 savings plan must be used for qualified higher education expenses.

Still, your grandchildren might be particularly interested in owning the stocks contained in the custodial account – most young people enjoy owning shares of companies that make familiar products. And to further interest your grandchildren in a lifetime of investing, you may want to show them how a particular stock you’ve owned for decades has grown over time. Naturally, you’ll also want to let them know that stocks can move up and down in the short term, and there are no guarantees of profits – but the long-term growth potential of stocks is still a compelling story.

You’d probably do whatever you could for your grandchildren – and with a smart financial gift, you can make a big difference in their lives.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

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FINANCIAL FOCUS – Can You Save for College and Retirement?

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Few of us have unlimited financial resources — which means that almost all of us need to prioritize our financial goals. Consequently, you’ll have some decisions to make if you’d like to help pay for your children’s college educations someday while, at the same time, saving for your own retirement.

Your first step in addressing these objectives is to maintain realistic expectations. Consider the issue of paying for college. Right now, the average four-year cost (tuition, fees, room and board) is about $80,000 for in-state students at public universities and approximately $180,000 for private schools, according to the College Board. And these costs are likely to keep rising in the years ahead. Can you save this much for your kids’ education?

Instead of committing yourself to putting away this type of money, take a holistic approach to saving for your children’s higher education. After all, you probably won’t be the only one to help pay for college. Depending on your income and assets, your family might be eligible for some needs-based financial aid awarded by the college. Also, you should encourage your children to apply for as many scholarships as possible — but keep in mind that most scholarships don’t provide a “full ride.”  Here’s the bottom line: Don’t assume you will receive so much aid that you don’t need to save for college at all, but don’t burden yourself with the expectation that you need to pick up the full tab for your children’s schooling.

On a practical level, you may want to commit to putting a certain amount per month into a college savings vehicle, such as a 529 plan. You can generally invest in the 529 plan offered by most states, but in some cases, you may be eligible for a state income tax incentive. Also, all withdrawals from 529 plans will be free from federal income taxes, as long as the money is used for a qualified college or graduate school expense of the beneficiary you’ve named. (Withdrawals for expenses other than qualified education expenditures may be subject to federal and state taxes and a 10% penalty on the earnings.)

By starting your 529 plan early, when your children are young, you’ll give the investments within the plan more time to grow. Plus, you can make smaller contributions on a regular basis, rather than come up with big lump sums later on. And by following this approach, you may be in a better financial position for investing in your IRA and your 401(k) or other employer-sponsored retirement plan. Obviously, it’s to your benefit to contribute as much as you can to these plans, which offer tax advantages and a wide range of investment options. If you’re investing in a 401(k) or similar employer-backed plan, try to boost your contributions every time your salary increases. At the very least, always put in enough to earn your employer’s matching contribution, if one is offered.

And once your children are through with college, you can discontinue saving in your 529 plan (although you may want to open another one in the future for your grandchildren) and devote more money to your retirement accounts.

It can certainly be challenging to save for education and retirement – but with discipline and perseverance, it can be done. So, give it the “old college try.”

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

marques-young

FINANCIAL FOCUS – Stay Calm on the Investment “Roller Coaster”

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Unless you live near an amusement park that does a lot of advertising, you probably didn’t know that Aug. 16 is National Roller Coaster Day. Actual roller coasters provide people with thrills. But as an investor, how can you stay calm on the “roller coaster” of the financial markets?

Here are some suggestions:

  • Know what’s in front of you. If you’ve ever ridden a roller coaster in the dark, you may find it scarier than if you boarded it in daylight – after all, it can be unsettling not to know where you’re going. The same can be said about investing: If you have no idea what’s in front of you, you might find the journey unnerving – and if that happens, you could make panicky decisions, which are usually bad ones. So prepare for the inevitable market volatility – it’s a normal part of the investment landscape.
  • Buckle up. When you’re on a roller coaster, you need to buckle your seat belt or use a restraint. You want to have the excitement of the ride, but you certainly don’t want to take unnecessary risks. And you can enjoy some of the excitement of investing without incurring more risk than you are comfortable with, too. One way to lower your risk level is to diversify across a range of investments – stocks, bonds, government securities, and so on. That way, if a market downturn primarily affects just one type of investment, you’ll have some protection. However, although diversification can reduce the impact of volatility on your portfolio, it can’t protect against all losses or guarantee a profit.
  • Choose a strategy for the journey. Different people have different ways of handling a roller coaster ride. Some like to throw their hands up, enjoying the feeling of abandon, while others hold on tightly to the bar in front of them. When you invest, you also need a strategy that works for you, and the best one may be the simplest: Buy quality investments and hold them for the long term. How long is “long term”? It could be 10, 20, 30 years or more. Famed investor Warren Buffet says his favorite holding period is “forever.” If you’ve chosen a mix of quality investments appropriate for your risk tolerance, you may be able to hold them until either your goals change or the investments themselves undergo some transformation.
  • Stay for the whole “ride.” When you hop on a roller coaster, you’ve got no choice – you’re staying until the ride is over. As an investor, though, you can exit the investment world whenever you like. But if you take a “time out” from investing every time the market drops, you risk still being out of the market when it rallies – and the early stages of a rally are often when the biggest gains occur. Furthermore, if you keep investing during a “down” market, you’ll be buying shares when their price has dropped, which means your dollars can go further – and you’ll be following one of the basic rules of investing: “Buy low.”

You can’t take out all the twists and turns of the investment road, but by following the above suggestions, you can help make the ride less stressful – and possibly more rewarding.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

marques-young

FINANCIAL FOCUS – How Can You Leave the Legacy You Desire?

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You may not see it in the greeting card section of your local drugstore, but August is “What Will Be Your Legacy Month.” So it’s a good time to think about the type of legacy you’d like to leave.

Of course, “legacy” can mean many things. In the broadest sense, your legacy is  how you will be remembered by your loved ones, friends and the communities to which you belong. On a practical level, establishing your legacy means providing your family and the charitable organizations you support with the resources you’d like them to have.

And that means you may need to take the following actions: create your plans, communicate your wishes and review and update your documents.

Let’s take a quick look at all these steps:

  • Create your plans. You will want to work with your legal professional, and possibly your tax and financial professionals, too, to draft the plans needed to fulfill your legacy wishes. These plans may include drafting a will, living trust, health care directive, power of attorney and other documents. Ideally, you want these plans to do more than just convey where you want your money to go – you want to impart, to the next generation, a sense of the effort that went into building the wealth they receive. Without such an appreciation, your heirs may be less than rigorous in retaining the tangible legacies you’ve left them.
  • Communicate your wishes. It’s important to communicate your legacy-related wishes to your family members as early as possible. By doing so, you can hopefully avoid unpleasant surprises and hurt feelings when it’s time for your estate to be settled – and you’ll also let people know what tasks, if any, they need to perform. For example, if you’re choosing a family member to be the executor of your estate, or if you’re giving someone power of attorney over your financial or health-related matters, they should be prepared.
  • Update your documents. During your life, you may well experience any number of changes – new marriage, new children, opening a family business, and so on. You need to make sure your legal documents and financial accounts reflect these changes. For example, if you’ve remarried, you may want to change the beneficiary designations on your IRA, 401(k) and other retirement accounts – if left untouched, these designations may even supersede the instructions left in your will. And the directions in life chosen by your grown children may also dictate changes in your will or living trust. In any case, it’s a good idea to review all your legacy-related documents periodically, and update them as needed.

In addition to taking the above steps, you also need to protect the financial resources that go into your legacy. So, when you retire and begin taking funds from your IRA, 401(k) and other retirement accounts, make sure your withdrawal rate is sufficient for your living expenses, but not so high that it eventually jeopardizes the amounts you planned to leave to your family or to your preferred charities. A financial professional can help you determine the withdrawal rate  appropriate for your situation.

With careful planning, and by making the right moves, you can create the type of legacy you desire – one that can benefit your loved ones far into the future.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

marques-young

FINANCIAL FOCUS – Diversify Your Investments … But Consolidate Your Providers

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You have probably heard that diversification is a key to investment success. So, you might think that if diversifying your investments is a good idea, it might also be wise to diversify your investment providers – after all, aren’t two (or more) heads better than one?

Before we look at that issue, let’s consider the first half of the “diversification” question – namely, how does diversifying your investment portfolio help you?

Consider the two broadest categories of investments: stocks and bonds. Stock prices will move up and down in response to many different factors, including good or bad corporate earnings, corporate management issues, political developments and even natural disasters. Bond prices are not immune to these dynamics, but they are usually more strongly driven by changes in interest rates. To illustrate: If your existing bond pays 2 percent interest, and new bonds are being issued at 3 percent, the value of your bond will fall, because no one will pay you full price for it. (Of course, it may not matter to you anyway, especially if you planned to hold your bond until maturity, at which point you can expect to get your full investment back, providing the bond issuer doesn’t default.)

Here’s the key point: Stocks and bonds often move in different directions. If you only own U.S. stocks, you could take a big hit during a market downturn, but if you own domestic and international stocks, bonds, government securities, certificates of deposit and other types of investments, your portfolio may be better protected against market volatility, and you’ll have more opportunities for positive results. (Keep in mind, though, that even a diversified portfolio can’t prevent all losses or guarantee profits.)

So, it clearly is a good idea to diversify your investment portfolio. Now, let’s move on to diversifying financial service providers. Why shouldn’t you have one IRA here and another one there, or enlist one advisor to help you with some types of investments and a different advisor assisting you with others?

Actually, some good reasons exist to consider consolidating all your investment accounts with one provider. For one thing, you’ll keep better track of your assets. Many people do misplace or forget about some of their savings and investments, but this will be far less likely to happen to you if you hold all your accounts in one place.

Also, if you have accounts with several different financial service providers, you might be incurring a lot of paperwork – and many fees. You can cut down on clutter and expense by consolidating your accounts.

But most important, by placing all your accounts with a single provider, possibly under the supervision of a single financial advisor, you will find it much easier to follow a single, unified investment strategy, based on your goals, risk tolerance and time horizon.  You won’t get conflicting advice and you’ll receive clear guidance on important issues, such as the amounts you can afford to withdraw each year from your retirement accounts once you do retire.

Diversification and consolidation – one is good for building an investment portfolio, while the other can help you invest more efficiently and effectively. Put the two concepts together, and make them work for you.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

Marques Young
Edward Jones Investments
8001 Centerview Parkway, Suite 112
Cordova, TN 38018
Office: (901) 751-0634
Email: marques.young@edwardjones.com
Member SIPC

marques-young

LAST MINUTE FILING TIPS FOR 2016 TAX RETURNS

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Any accounting, business or tax advice contained in this communication, including attachments and enclosures, is not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties. If desired, we would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired consultation services.
Are you one of the millions of Americans who hasn’t filed (or even started) your taxes yet? With the April 18 tax filing deadline quickly approaching, here is some last minute tax advice for you.

1. Stop Procrastinating. Resist the temptation to put off your taxes until the very last minute. It takes time to prepare accurate returns and additional information may be needed from you to complete your tax return.

2. Include All Income. If you had a side job in addition to a regular job, you might have received a Form 1099-MISC. Make sure you include that income when you file your tax return because you may owe additional taxes on it. If you forget to include it you may be liable for penalties and interest on the unreported income.

3. File on Time or Request an Extension. This year’s tax deadline is April 18. If the clock runs out, you can get an automatic six-month extension, bringing the filing date to October 16, 2017. You should keep in mind, however, that filing the extension itself does not give you more time to pay any taxes due. You will still owe interest on any amount not paid by the April deadline, plus a late-payment penalty if you have not paid at least 90 percent of your total tax by that date.

4. Don’t Panic If You Can’t Pay. If you can’t immediately pay the taxes you owe, there are several alternatives. You can apply for an IRS installment agreement, suggesting your own monthly payment amount and due date, and getting a reduced late payment penalty rate. You also have various options for charging your balance on a credit card. There is no IRS fee for credit card payments, but processing companies generally charge a convenience fee. Electronic filers with a balance due can file early and authorize the government’s financial agent to take the money directly from their checking or savings account on the April due date, with no fee.

5. Don’t forget to check the box for healthcare coverage. Checking the box on line 61 of Form 1040 shows that you had healthcare for all 12 months during the tax year (2016). The IRS will still process your tax return if you forget to check the box but this applies ONLY to 2016 tax returns–and you’re not off the hook for any penalty you might owe.

6. Sign and Double Check Your Return. The IRS will not process tax returns that aren’t signed, so make sure that you sign and date your return. You should also double check your social security number, as well as any electronic payment or direct deposit numbers, and finally, make sure that your filing status is correct.

Remember: To avoid delays, get your tax documents to the office as soon as you can.

Written by Steve Julal of VAAS Professionals

Steve

VAAS Professionals, LLC
325 Edgewood Avenue, S.E
Atlanta, GA 30312
www.vaasprofessionals.com
(404)223-1058

Entrepreneurs, Beware This Terrible Way of Networking on Social Media

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There’s a trend emerging on social media. Someone you don’t know but who may be connected to some of your friends or your network sends you a friend request. Shortly after, they send you a private message or email telling you what they want from you.

Every single day, I get these type of friend requests and messages. Someone’s first interaction with me is to ask me to write about them or their company, or they want to pick my brain about how to book paid speaking and consulting gigs internationally. No “hello,” no small talk. They just get right to what they want and how it somehow benefits me.

This is a terrible way to network and will never make a connection with fellow entrepreneurs. Social media works a lot like real life. You wouldn’t walk up to a stranger, say “hello” and then try to kiss them. There are three things you should understand in regards to networking.

1. Lead with value.

Human nature is to focus on what we want and what will help us. Networking done right leads with value for the person you’re approaching.

I’m not going to give you the old-school advice to tell people you will work for free just to get their radar. It can be as simple as sharing a book suggestion or a helpful article that complements what that person has shared on social media. It’s not about a grand gesture, it’s about finding some way to approach that person with value.

Also, understand that trying to get them on the phone right away is too much. They don’t know you, a phone call right off the bat is not a great ask. Your asks should not exceed the realities of your relationship.

To read the rest of the article, click Entreprenuer.com.

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KIMANZI CONSTABLE

25 Features Every Business Website Must Have in 2017 (Infographic)

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Even though online businesses are becoming more prevalent, they haven’t become any easier to launch.

To give your online business a greater chance to succeed, there are certain things you need to incorporate on its website. Of course, there are the simple things such as an easy domain name, a phone number and a logo, but it’s also vital to think about the content, links and navigation that will go onto your site.

When building your website, sometimes it’s helpful to think of its setup like that of a newspaper — organizing the most important content “above the fold,” and the less exciting material “below the fold.” In addition, having a strong call to action will help hook potential customers.

For the rest of the article, click here.

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Rose Leadem is an online editorial assistant at Entrepreneur Media Inc.

3 Ridiculously Easy Hacks to Get People to Sign Up to Your Email List

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Have you ever changed the oil in your car?

It’s a pretty basic skill that surprisingly few people actually know how to do. If you do, you’ll most likely have used a funnel before.

The main idea behind a funnel is to cast a wide net that you can pour the viscous liquid into it without spilling it all over the engine block. The oil flows through the wide top end of the funnel and is neatly deposited into the narrow bottom end, filling your engine up so that the car runs smoothly.

In the internet marketing world, we also have funnels. Their purpose is to cast a wide net and find people across the web who might be interested in our material, then get those people to neatly file themselves into our email database so that we can provide them with valuable content, market to them and eventually make some money.

Getting people to opt-in.

Once a member of your audience has interacted with your content, it’s time to get them on your email list. This might seem challenging at first, but think about your own inbox. How many newsletters are you subscribed to?

The average person subscribes to anywhere between 20 and 30 free newsletters from a variety of businesses. Anything from a department store doing a semi-annual sale, to the Nissan dealership giving away insane deals on the 2018 Altima, to content-based emails about things that interest you.

At one point you weren’t receiving emails from that business…and now you are. How the hell does that happen?

In most cases, it people sign up to an email newsletter to get something for free. This is called an “opt-in,” and it’s your bread and butter if you want to build an online business — especially one that’s based on information products.

For the rest of the article, click here.

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Daniel DiPiazza is the founder of Rich20Something, where he teaches young people how to start businesses that they care about and live happier lives.

3 Fun and Festive Spring Promotion Ideas that Retailers Can Use to Increase Sales

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If you’re a small business retailer, every season brings new opportunities – and new challenges. If you’re looking for some fun and festive ways to increase your small business sales now that spring has arrived and the weather is getting warmer, we’ve got just the things for you!

In this article, we’ll take a look at three great spring promotions that your small retail business can use to help drive sales, promote brand awareness, and increase customer loyalty.

Sidewalk Sales!

Spring is the perfect opportunity for sidewalk sales! These unique, fun sales allow you to get out and enjoy the nice weather and benefits that extra foot traffic can have on your business when the weather is warm and sunny.

Collaborate with other small business retailers in your area to set up your sidewalk sale – set up booths and tables all around your businesses, and encourage customers to visit all of your stores. The warm weather and high volume of customers that a sidewalk sale provides are sure to help your business succeed.

To read the rest of the article, click here.