Recently, I was having coffee at Starbucks with a client when I asked him this question, “Should I pay off my mortgage or invest?” I told him that I personally was struggling with planning in this matter (YES!! Even a planner questions their decisions occasionally!!). After generically discussing the subject, I decided to research the topic in greater detail to see if I could come up with a definitive answer to the age-old question: Should excess funds within my budget pay off my mortgage or go toward investments?
WEEKLY UPDATE – August 29, 2016 We are going to discuss LIBOR Surge May Rule Out September Fed Rate Hike in this article. After rallying for weeks, the major indexes fell last week ahead of key remarks by Federal Reserve officials and turbulence in money markets. For the week, the S&P 500 lost 0.68%, the Dow fell 0.85%, the NASDAQ dropped 0.37%, while the MSCI EAFE gained 0.16%. Even as the Fed has kept interest rates flat, an unexpected surge in short-term interest rates triggered by an industry rule change is potentially doing some of the Fed’s work for it. If you ever tune in to the financial news, you may have heard the term LIBOR (pronounced LIE-bor) mentioned in reference to money markets (what we call the trade of short-term loans between banks and other financial institutions). LIBOR Surge May Rule Out September Fed Rate Hike LIBOR, the London Interbank Offered Rate, is a benchmark used for a vast range of debt, including mortgages and corporate loans. Recently, the three-month LIBOR (the rate charged for lending dollars for three months) has reached multi-year highs (rising more than 30% since this June), tightening credit conditions without any action by the […]
Preparing your estate in advance is one of the greatest gifts you can give your family. Many estates include real estate in the form of a primary home, vacation home, and other family properties. While inheriting a property can be a wonderful legacy, it also comes with obligations that heirs may be unprepared or unable to fulfill. If you intend to leave real estate to your heirs, ask yourself these five questions to help avoid creating problems for your loved ones. 5 Estate Questions Will the Property Have a Mortgage? If the property comes with a mortgage or home equity loan, your heirs will need to negotiate with the lender to satisfy the terms of the loan. In many cases, they may need to sell the property to pay off any loans if financial provisions aren’t made elsewhere in the estate. Life insurance is one option for giving loved ones the cash needed to satisfy final debts. What Are the Tax Considerations? If you leave a large estate, your heirs might end up owing state and federal estate taxes on their inheritance. Make sure that your heirs have the financial resources they will need to satisfy the tax bill. If […]