February 23, 2017

10 Facts to Know about Capital Gains and Losses

When a person sells a capital asset, the sale normally results in a capital gain or loss. A capital asset includes inherited property or property someone owns for personal use or as an investment.Here are 10 facts that taxpayers should know about capital gains and losses: Capital Assets. Capital assets include property such as a home or a car. It also includes investment property, like stocks and bonds. Gains and Losses. A capital gain or loss is the difference between the basis and the amount the seller gets when they sell an asset. The basis is usually what the seller paid for the asset. For details about inherited property, see IRS Publication 544, IRS Publication 550 and IRS Publication 551. Net Investment Income Tax. Taxpayers must include all capital gains in their income. Capital gains may be subject to the Net Investment Income Tax if the taxpayer’s income is above certain amounts. The rate of this tax is 3.8 percent. For details, visit IRS.gov. Deductible Losses. Taxpayers can deduct capital losses on the sale of investment property but can’t deduct losses on the sale of property they hold for their personal use. Limit on Losses. If a taxpayer’s capital losses […]
February 20, 2017

Lessons Learned on Presidents’ Day

One of the greatest lessons learned on Presidents’ Day comes from our 19th President, Rutherford B. Hayes. The former president set out to reconcile the division caused during the Civil War. As you can imagine, there was a great deal of angst and animosity among the American people. After spending several years at war with one another they hated each other. Hayes is actually one of the most hotly contested Presidents to ever take office. He narrowly won the popular vote and Electoral College over his opponent Samuel J. Tilden. One of his greatest obstacles, building his cabinet. In order to unite the country, he chose to bring people in from all over the country and not just the north as some expected. Hayes is actually credited with building the new Republican party in the South, the same Republican party Lincoln is associated with. The truth, this was such a challenge, even more so than what we see currently in today’s political climate, that his perseverance is one of the reasons we are still the United States of America today. You may be thinking, “Justin what does this have to do with making my finances simple?” Well, I’m glad you asked. Reaching […]
February 17, 2017

Million Dollar Mistake

Hey, guys! So this last week I was meeting with a client, and we discovered a one million dollar mistake. Are you making the same mistake? Let’s dig in and find out. He’s investing $1,500.00 a month into his 401k. When we looked at his allocation, in other words, where he’s putting the money, he has all the money flowing into a target date mutual fund or a target date fund. What is a target date fund? Well, you’ve probably seen these in your 401k if you have one. They’re typically the fund that says like 2020 or 2025 or 2030. The idea behind a target date fund is the fund company, XYZ Fund Company, grabs a group of their investments, a group of their mutual funds typically, and wraps them in a pretty wrapper. That the closer you get to that target date of 2020 or 2030, then the mutual fund or that Target Date Fund becomes more and more conservative in nature. Are you doing it too? Many people unknowingly select these investments because they’re easy. But in this client’s case, it was a one million dollar mistake. So how did I come to that? The 10-year track […]
February 16, 2017
investing mistakes to avoid

Investing Mistakes to Avoid

With the current market, investing is a risk no matter where you choose to place your money. Uncertainty is a key feature today, and it is just something we need to accept. However, that doesn’t mean making money from investing is impossible. In fact, more people are padding their net worth from investment opportunities than ever before.  Which suggest something else – rather than judging market fluctuations based on what we know; we need to reposition ourselves and learn it all over again. With that in mind, here are nine investing mistakes to avoid, so you can thrive in uncertain waters, rising above the competition. Trying to Perfect Your Timing – For years, we’ve heard the best way to make money is to time the market. By this, we mean buy when prices are low and sell while they’re high. Achieving this could make you lots of moola. The problem with this? Even the most experienced investors are actually bad at timing. The market is ambiguous. It’s impossible to know what it will do from hour to hour. By the time we notice a good deal, it’s gone. And when we realize it’s time to sell, it is too late. Both scenarios […]