My grandfather lived with us for many years before he passed. He emigrated from Russia by way of Canada. He worked hard running his own little grocery store his whole life. No one ever talked to him about saving for retirement; he had no other choice but to move in with us. It was wonderful having him there, but we don’t want to have to move in with our daughter when we retire. Here is what we will do to make sure we can remain independent:
Have a retirement plan. We know when we want to retire, how much it costs us to live, what things we would like to do in retirement, and what our family medical history has told us to prepare for later in life. From these points, we know how much we need to save and for how long.
I mentioned family medical history; it is important when planning for medical expenses in retirement. Anything can happen at any time, but facing your heredity can help make medical expenses easier to deal with later in life. Review your copays, deductibles, and long term care coverage.
Spending is everything. Many people plan for how big their nest egg needs to be, but have you thought about how to withdraw the income you will need? Have a plan for where you will pull funds from first, how much to withhold in tax, and how to handle emergencies.

disclosures:http://www.hechteffect.net/?page_id=31

My daughter is getting ready to move into her own apartment. In preparing to move, we are going through closets and the attic to find all of her stuff. While looking through one box, we found tax documentation dated 2003. I knew that could go to the shred pile, but how long do you need to keep your stuff, and what stuff is important?
We have complied a “keep or shred” document to answer that question.

KEEP OR SHRED-CFG (2)

disclosures:http://www.hechteffect.net/?page_id=31

A few blogs ago I wrote about treating my family to lunch with my savings at the pump. While this is something to cheer about, if you are already retired, you may not be cheering.
For just the 3rd time in 40 years there will be no increase in your Social Security check. Blame this on the savings at the pump. COLA calculations for the past year indicate that inflation has not increased, therefore, no increase in your Social Security. To make matters worse, your health care costs may increase. Medicare part B premiums are deducted directly from your Social Security and while there is no COLA increase, heath care is not part of the COLA calculation.
Here’s hoping that gas prices go up?

disclosures:http://www.hechteffect.net/?page_id=31

Unless you have filed for an extension, tax season is over until next year. Let’s address some concerns you may have had this tax season, and how to plan for an easier time next year.

Were you disorganized?
Many people dump their receipts, deduction confirmations, or expenses summary into a box or folder throughout the year. Come January, you have to sort and total all of these different potential deduction items. A simple solution is to scan everything into folders or use pocket folders labeled for each type of expense.

Did you under withhold?
This is the surprise that no one wants. We are obligated to pay in at least as much as you paid in federal tax your pervious year. Most of us can realize if we have made more in income or through our investments. Quarterly payment of estimated tax will help soften this burden when you file.

Should you have contributed more?
Many people wait until between January – April to make their deductible IRA contributions. Depending on how your year has been due to unforeseen expenses, this may be hard to do. Try adding to your deductible IRA monthly as you pay any other bill. You are paying yourself and reducing your tax bill at the same time.

disclosures:http://www.hechteffect.net/?page_id=31

Who doesn’t love a bargain? Finding a great pair of shoes or item of clothing on sale is always great. Groupon’s for everything from dinner to a concert are constantly being used to get a deal. So why don’t we like it when our investments are on sale?
2016 has not been positive for the markets as of yet. We still have a lot of year ahead of us. Most investors are about to receive their first quart reports and will not be happy with their numbers. We find losing $100 much more painful than the joy at a $100 gain. Why is that?
If you are a long term investor, down markets allow you to buy more shares because everything is on sale. More shares generally will equal more income from dividends and capital gains in retirement.
If you regularly contribute to your investments through your 401k, or a similar plan, rejoice!
While you are accumulating, you want your investments to be on sale.

disclosures:http://www.hechteffect.net/?page_id=31

1959-April-News-Print-NancyHecht

How Much things cost in 1959
Yearly Inflation Rate USA 1.01%
Yearly Inflation Rate UK 0.9%
Average Cost of new house $12,400.00 Average Yearly Wages $5,010.00 Cost of a gallon of Gas 25 cents Average Cost of a new car $2,200.00 Movie Ticket $1.00 Loaf of Bread 20 cents Kodak Movie camera $67.50 Ladies Stockings $1.00
Below are some Prices for UK guides in Pounds Sterling
Average House Price 2,410 Austin 7 ( Mini ) 500

newspaper from:takingyoubackintime.com

disclosures:http://www.hechteffect.net/?page_id=31

I know plenty of people like to file their tax return electronically. It is so easy to do. Electronic filing has been a boon to legitimate taxpayers; it has also been a boon to identity thieves. In 2010 there were 500,000 fraudulent returns filed, by 2013 that number had ballooned to over 2 million.
I have had a number of clients over the past 3 years contact me after trying to file electronically. While trying to do so, they discover that someone has already filed under their social security number. Trying to put the pieces together to discover where the identity theft occurred, then protecting yourself afterward is a huge job.
A special note for Florida residents:
FL has a program where if a person has been hacked, they can file for a pin, which changes every year for added protection.
Please, take the extra step to just mail your return in. Your piece of mind is priceless.

Disclosures:http://www.hechteffect.net/?page_id=31

I recently helped a young man navigate the world of the 1040EZ. He is a college student who works. He was told he did not even have to file a return. He was going to do nothing. His total earnings for 2015 were just over $11,000. He will get back what he paid in Federal tax; it was a very small amount.
He asked me why he even had to bother. I reminded him that it is a law. If you are single and earn over $10,300, you have to file your tax return.
You don’t play around with the IRS.

disclosures:http://www.hechteffect.net/?page_id=31

I have been talking to a lot of first time investors that are in their 20’s, which makes me happy. They were in high school during the crash of 2008 and know that things can change quickly. They watched their parents lose jobs and homes. They are also learning that they have to do for themselves. They still have a bit of a hard time when it comes to spending. Often, I tell them to ask themselves if an item is a want or a need before they spend their money. To make it easier for them to decide, I have shared a few tips.
Carry cash. This is almost a foreign concept to this age group. By carrying and spending cash, you have to go through more of an effort to get it out, make sure you have enough for your purchase, and stow the change. Hopefully, this will make you ask if this is a need or a want. I have heard back from this age group that when they spend a week only using cash, they get a better idea of just how much they are spending.
Make it harder to get to your credit card. I’m not talking about freezing your cards, just adding steps to actually get your card out. Wrap your credit card in a small piece of paper, tied with a rubber band. You now have to un-wrap the card to use it. This gives you a smidge more time to think about the need of that purchase.
Hold yourself accountable to someone about your spending. Make an agreement with someone you trust to discuss purchase over a certain amount. Simply discussing the purchase will force you to ask; “Is this a need or a want?” You will become a better consumer.

disclosures:http://www.hechteffect.net/?page_id=31

These tax breaks are still available to you even if you don’t itemize. I believe you should use every legal means possible to lower your tax bill. Look to see if any of these apply to you.
If you are a teacher and spend your own money for supplies for your classroom, you can write off $250.00 of that out-of-pocket expense.
If you have used after tax dollars to fund your health savings account, you can take an above the line deduction.
Divorced & paying alimony? As long as your alimony payments are spelled out in your divorce decree, you can deduct them.
Retirement account deposits to a traditional IRA may be deductible. As long as you contribute within the limits, you can make a 2015 IRA contribution up until 4/18/16.

Don’t pay more than you have to in federal income tax – look to see if any of these deductions apply to you.

disclosures:http://www.hechteffect.net/?page_id=31