Archive for May, 2018

Reverse Mortgages for Retirees – Boon or Bane?

It’s a commonly quoted statistic that nearly half of American families have no retirement savings. For many people facing retirement, their homes may be the only asset they have to help fund their post career living expenses. Over the last few years there have been a lot of stories about reverse mortgages where retirees sell their homes to the bank in exchange for cash or income over the course of their life. There are several ways the homeowners can be paid out – a lump sum, a monthly annuity, or a line of credit.

Are these a good deal? They may be advantageous from an ease of acquisition, interest rate and from a planning perspective when compared with a home equity loan or a home equity line of credit against the homeowner’s house for an elderly individual with no income other than social security. They can be a good deal in a few situations – namely under very specific circumstances, if someone remains in their life for longer than their life expectancy, then they may be able to “beat” the bank, however this is a very rare occurrence. When distributed, the income or advances are generally not treated as taxable income, although they may be treated as assets against Medicare eligibility. Learn more…

Donor Advised Funds and Foundations

Donating money to charities can be a great way for a family to make an impact on their community, and to create a lasting legacy.  Charitable donations can also make sense as a way to eliminate tax liability.

Many times, when a family is considering a donation to charity, the donation they will fund the donation with a gift of appreciated securities – stocks or properties at a low cost basis, which would create a large tax liability if sold normally.  Sometimes a family will make direct donations to a charity, whether its immediate or in the future through a charitable trust.  However, sometimes a family will want to create a general purpose charitable fund to make donations to different charities across many years, potentially even generations.  In these situations when flexibility and long giving lifecycles are desired, there are several vehicles a family can use.  Some of the most common are the donor advised fund (DAF) and the Private Foundation. Learn more…

Life Insurance: The Usages

They say that when you’re a hammer, all the world’s a nail. It seems like life insurance salespeople will try to sell you life insurance as a solution to almost any problem you may have. We’ll give you a bit of a quick primer on some of the various ways life insurance is used.

These are a few of the main ways that life insurance is used for individuals, and there are others. However, in every instance, insurance policies are complex and sophisticated legal contracts, and they may not be right for you. You should definitely consult with an independent advisor before to make sure you understand what you’re buying.

Read more about life insurance here…

Side Businesses and Tax Deferral

If you’re a small business owner who has a significant income, minimizing your taxes can do a lot to improve your income. There are a number of different shields people use – depreciation, and business expense deductions for example, we won’t go into these, instead in this article, we’ll talk about setting up other companies and some of the things this can do for your tax liability.

First of all – you can’t set up dozens of 401ks and contribute the maximum (currently $18,000) to each of them. The caps on defined contribution plans and deferrals are set at the personal level not the employer level. However, it may not work with the structure of your current business, but if have a stable and profitable new business with yourself as the sole employee, you could set up a pension plan for yourself and fund that. Depending on your age, you may be able to set aside considerable amount of money. Read more…

Setting Up A Corporation In New York State

As long as your articles of incorporation meet these five requirements, and you pay the $125 filing fee, your application should be approved. Setting up a corporation is the easy part though — now that you have a small business of your own, you may need small business financial advice to avoid the pitfalls many inexperienced business owners face. Read more…

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