3 Questions Every Woman Should Answer Before Claiming Social Security Benefits

AdobeStock 128053044

Although Social Security was never designed to sustain retirees’ living costs in its entirety, it has become a reliable source of income many Americans utilize to help bridge the gap between other sources of retirement income and total expenses, especially for women.

According to the Social Security Administration, women make up 56% of the 37.8 million beneficiaries aged 65 and older. Why? Women enjoy longer lifespans than men and have less saved for retirement due to the gender wage gap and years spent outside the workforce in caretaking roles. As a result, women between the ages of 60 and 64 are estimated to have $40K less in retirement savings than their male counterparts, making social security benefits a more integral part of their retirement plan.

Maximizing social security benefits, then, should be a retirement planning factor women take care not to overlook.

  • Should I Continue Working to Make Up for Years Out of the Workforce?

Social security benefits are based on lifetime earnings and are calculated using your average indexed monthly earnings during the thirty-five year period when you earned the most income. However, since many women leave the workforce to raise their own children or help care for aging parents, they may not have had an opportunity to log a full thirty-five years or, if they did, inevitably earned less over that duration due to the gender wage gap (which still exists today).

One option women can exercise is to continue working past their initial projected retirement date in order to (a) inflate the income average that will be used to calculate their benefits or (b) avoid having zeros factored in for the number of years under 35 that they did not pay into the system.

Social security benefits are considered earned benefits, so if you don’t work for a full 35 years, and subsequently do not pay into the system for a full 35 years, you’ll have zeros factored into your calculation for the number of years you did not show an income. Since working full-time at an older age is not always feasible or desirable, some women choose to take on part-time work from home in order to avoid having zeros factored into their lifetime benefit calculation.

Continue reading

The Top 3 Financial Challenges Hispanic-Americans Face

Top Financial Challenges Hispanics Face

Hispanic Americans make up one of the fastest growing segments of the U.S. population, and with more Hispanics being birthed in the U.S. then ever before, the growth of this group shows no signs of slowing down. The US Census Bureau projects the Hispanic American population to increase 115% by 2060, at which point they will represent 30% of the entire population.

And this burgeoning segment is not growing without prosperity. According to the Hispanic Access Foundation, the buying power of Hispanics is exceeding $1 trillion and is expected to grow another 50% over the next five years. Hispanic business owners alone contribute more than $70 billion to the US economy.

But despite their entrepreneurial and financial success, nearly half of all Hispanic Americans surveyed by Mass Mutual still reported feeling less financially secure than other groups. So how do we explain this disconnect? For many Hispanics, the following factors tend to get in the way of preparing for long-term financial success and, subsequently, create feelings of financial insecurity.

1) Language and Monetary System Barriers

For native-born Hispanic Americans, the language barrier and US monetary system are far less problematic than they are for older members of the population who immigrated to the U.S. at an older age with limited language skills and resources.

Being a non-native English speaker entering a country with a completely different monetary system can pose huge problems for individuals trying to decipher complicated US tax forms, legal contracts, or applications for credit. Many times, the less fluent, older Hispanic populations will rely on help from their teenage children (or even grandchildren) to translate and interpret such forms!

Continue reading

WHAT WOMEN NEED TO KNOW TO TAKE CONTROL OF THEIR FINANCIAL FUTURE - PART II

What Women Need to Know to Take Control of Their Financial Future Part II

Insuring Against the Unexpected

Risk management is a vital element of any financial plan. There are events and occurrences in life that we simply cannot predict. However, we can help to guard ourselves against financial devastation in the face of these unfortunate changes with different types of insurance tools.

  • Life Insurance: Traditionally, life insurance policies are purchased with the intention of financially aiding the surviving widow or widower after the unfortunate loss of a spouse. These policies pay death benefits to surviving spouses or beneficiaries upon the owner’s passing in exchange for premiums paid during the owner’s lifetime. There are two basic types of life insurance policies: term life insurance and permanent. Term life insurance policies expire after a certain term, or number of years, whereas permanent, whole life insurance policies provide lifetime coverage.

Life Insurance policies can provide many benefits. For women who are the primary breadwinner of the family, life insurance policies can provide financial security for the family in her absence. The hybrid policies with cash allocations allow the owner to borrow against the cash value of the benefit, which could help a woman pay off debt, start a new business, or finance her children’s education. And policies which combine life insurance with long-term care riders can provide financial resources should the owner become terminally ill. The type of policy you choose, though, should not be a decision made in isolation, but in the perspective of your overall financial circumstances and available resources.

  • Long-term Care Insurance: According to the most recent data presented by the US government, at least 70% of Americans over the age of 65 will need some form of long-term care in their lifetime. Long-term care needs range from periodic in-home help with daily activities to full-time nursing home living. However, planning to pay for the high costs of assisted living or in-home aids is often overlooked.
Continue reading

What Women Need to Know to Take Control of Their Financial Future - Part I

What Women Need to Know to Take Control of Their Financial Future

Here are the facts: Women are living longer than men[i] and nearly 50% of all marriages are likely to end in divorce (with even higher rates of “Gray Divorce,” or divorces amongst those over age 50). What does this mean for women? That at some point in their lives, whether through divorce, widowhood, or personal choice, the responsibility of financial management will land squarely on their shoulders.

Women have made impressive strides over the past few generations with more than half of American women acting as the primary breadwinner in their household. Today, women are working and earning more than ever before.

But when it comes to money matters, a striking number of women statistically still leave the responsibility of financial management up to men. Experts attribute this trend to a lack of confidence in financial decision making, the female focus on caregiving and homemaking, and even just traditional, societal norms; but regardless of this tendency, longer life expectancies and higher divorce rates indicate that women should empower themselves to take control of their financial futures sooner rather than later.

The main problem, however, is that many women are unsure of where to begin. In fact, over 40% of women say that a lack of knowledge regarding their financial affairs is the single largest deterrent to becoming more involved in money management.[ii]

With this in mind, we have formatted this article into two installments to help women overcome their financial challenges and take control of their future.

Continue reading

The Right Way to Help Your Child Get into the College of Their Choice

The Right Way to Help Your Child Get into the College of Their Choice

On March 12, 2019, United States prosecutors revealed the largest and most prominent college admissions scandal in US history to date. Allegedly, at least thirty-three affluent actresses, business leaders, and other wealthy parents of college applicants fraudulently inflated entrance exam scores, bribed college officials, and spent more than $25 million dollars between 2011 and 2018 to help their children get into the colleges of their choice. These parents and school officials face countless charges for mail fraud, felony conspiracy, and money laundering. The scandal has been dubbed “Operation Varsity Blues” and is the perfect lesson for how not to help your children get into the schools of their choice.

Parents with ethical standards, though, may be wondering about the right steps to take to help their son or daughter gain admission to their dream schools. With that in mind, we’ve compiled a list of the top 6 things you can do to help give your child the best chance of opening that college admissions letter that reads, “Congratulations!”

Focus on What You Can Control

When it comes to college admissions, the ultimate decision about a student’s acceptance or denial isn’t up to anyone except the decision-making board at the college. This lack of control can drive parents crazy. But, focusing on the elements you can control can make all the difference in boosting your child’s chances for a positive result.

Continue reading

The Do’s and Don’ts of Pre-Retirement Planning for Professional Athletes

The Dos and Donts of Pre Retirement Planning for Professional Athletes

As much as professional athletes are known for their stellar athletic abilities, they are equally notorious for living extravagant lifestyles and blowing their earnings in a flash. According to a Sports Illustrated article published in 2009, 78% of NFL players are either bankrupt or under financial stress within 2 years of retirement, and 60% of NBA players go bankrupt within five years of leaving the league.

A host of famous professional athletes are earning more than “the average Joe” will in his lifetime, but struggle with transitioning their short-term paychecks into lifelong financial security.

On a fundamental level, earners of all income levels face similar financial hurdles, such as staying out of debt, fighting the temptation to overspend, and saving for the future. But due to the nature of their careers, professional athletes are faced with some pretty unique challenges of their own.

The Game Plan

1) DO Become Financially Literate

Athletes often earn a great deal of money at a young age when they have had little to no experience handling their own finances. Not only does this increase the likelihood of mismanagement, but also leaves them vulnerable to financial salespeople who prey on those who come into sudden money.

Continue reading

What You Need to Know About Estimating Taxes in Retirement

AdobeStock 226035672 2

Income is income, in retirement or otherwise, and where there is income, there is tax. Even though your income in retirement will be coming from different sources, such as IRAs, pensions, or social security, in most cases you’ll still be responsible for paying taxes on what you receive or withdraw.

Many, if not most, retirees rely on multiple different sources of income to fund their golden years including, but not limited to, the following:

• Social Security Income
• Pension Plans
• Traditional IRA and 401(k) withdrawals
• Roth IRA or Roth 401 (k)s withdrawals
• Investment Income

Each type of income incurs unique tax rules and liabilities and will affect your take-home amount in different ways. In order to minimize the tax burden on your overall income and accommodate for those taxes in your budget, you’ll need to understand how each different type of income is taxed.

Continue reading

3 Hidden Tax Opportunities Dentists Often Miss

3 Hidden Tax Opportunities Dentists Often Miss 

Tax laws for business owners are ever changing and oftentimes quite complex. What may have worked to help limit your tax liabilities when you first started your practice may not be providing you the same benefits today. After 2018, for example, dentists may no longer qualify for Section 179 deductions on business upgrades or equipment purchases.

However, taking a look at your existing business structure, maximizing your retirement contributions, or opening a health savings account may be three simple, yet effective ways to help alleviate the high tax burdens dentists often face.

1) Is Your Current Business Structure Costing you Tax Dollars?

The business structure you operate under not only impacts how you are compensated, but also how your business entity pays tax. Operating under the wrong business structure is one of the main reasons dentists often overpay on their income taxes.

Continue reading

Tax planning for 2019: What did tax reform impact?

Tax planning for 2019 What did tax reform impact

Now that 2019 is off and running, it's time to start thinking about taxes. The tax reform bill, which was signed into law in December 2017, means changes for your taxes this year. Here are a few things to think about:

The marriage penalty is gone. The new law does away with the decidedly unromantic situation in which spouses were pushed into a higher tax bracket when they married. It’s all part of an overhaul in the tax bracket structure. If you’re single, you’ll probably see your tax bracket lowered, too.

Standard deduction. It’s the age-old question. Should you itemize or take the standard deduction? This year, thanks to the new tax laws, the answer to that question just got a lot easier. The standard deduction is now twice what it has been in previous years. For 2019, that means $12,200 for individuals, and $24,400 for married couples filing jointly. It means more people are going to be opting for the standard deduction, especially with the new limits on state, local or property tax deductions, capped at $10,000.

Continue reading

5 dental industry trends to watch in 2019

5 dental industry trends to watch in 2019

As 2018 draws to a close and 2019 nears, what are the industry trends dentists should be looking out for? Here are five trends to watch this coming year:

The growth of group practices. More group practices formed in 2018 than ever before, and the trend is expected to continue. One of the biggest reasons for dentists banding together is the rising costs of dental school, the highest in all of the medical arts. A shared practice means shared expenses and shared risk, which are highly attractive to dentists carrying student debt in the mid-six figures.

3D printing. This technology has been around for a few years, but it was mostly used in the dental industry for orthodontics. But now, it's growing more and more popular in general dentistry for implants, prosthodontics and more. Resin technology is ideal for dental devices and can deliver long- and short-term solutions for patients.

Continue reading

Understanding co-parenting agreements

Understanding co parenting agreements

Going through a divorce is one of the most traumatic, emotional and expensive times in any person's life. It's sometimes hard to know what to do first, where to go for help, and how to put the pieces of life back together as you and your children navigate through the days to your new normal.

If you're divorcing and have children, one of the most important things to understand is, your relationship with your spouse never ends. You both will always be family to your children. One of the ways to put that new normal into play early is through mediation, a process by which you and your spouse come to an agreement about the terms of your divorce. You'll meet with a neutral third party, a mediator, and talk through the issues you need to resolve to move ahead with the divorce.

One of the most powerful and positive things you can create through mediation is a co-parenting agreement. It is a joint, non-binding contract that lays out, ahead of time, how you will parent your children from different households.

Continue reading

Your divorce asset inventory: Know where your assets are

Your divorce asset inventory know where your assets are

 If you're preparing to file for divorce, or if your spouse has just dropped the bomb on you that he or she is filing, the first thing you should do is get a handle on the availability, liquidity and titling of all of your accounts. In other words, get your financial ducks in a row to clearly understand where you are financially before proceedings begin. 

Here are some things to make sure you get nailed down:

  • Your current bank and credit card statements.
  • Update yourself on any current loans or mortgages you might have.
  • Income tax returns. Going back five years is a safe bet. And make sure you include property tax returns.
  • Business financial statements, if you own one either jointly with your spouse or yourself. Get the facts on its net worth, assets, liabilities and cash flow.
  • Your current income information, including pay stubs, and remember to include one-time or quarterly income sources like rental or lease agreements on property you own, dividends, even lottery winnings since the filing of your last tax return.
Continue reading

Is re-financing your dental school loans right for you?

Is re financing your dental school loans right for you

How much debt are you still carrying from dental school? Does nearly $287,331 ring a bell? According to the American Student Dental Association, that's the average amount of debt dental students had when they walked out of the door with their diplomas in 2017. So if you've got six figures of student loan debt, you're not alone, and it's not surprising. Reports have shown that a dental school education is the most expensive of all higher education fields. Your peers are in the same financial boat.

If you've only been in practice a short while, you probably haven't paid much of your debt down. While student loans are a necessary evil for most dental students, they can make life difficult later on. Being six figures in debt with high monthly payments can impact a new dentist's ability to:

  • Get approved for a loan for equipment and a location to set up a practice.
  • Get approved to rent equipment.
  • Buy a home.
  • Save for retirement.
  • Pay for children's education.
Continue reading

Marketing ideas for your dental practice

 Marketing ideas for your dental practice

Every small business needs to focus on marketing to drive traffic through the door, and a dental office is no exception. Connecting with potential new patients and reconnecting with current patients is the lifeblood of a successful dental practice. Here are a few ideas to help you get the most out of your marketing efforts.

Postcards

Send direct mail postcards to the neighborhood around your office to introduce yourself and your practice to potential new patients. Offer a discount on services for new patients, bundle cleaning and whitening, or make the postcard itself into a coupon.

Create a robust website

If you don't have a website, hire a designer who specializes in dental marketing to create one. New patients search online for dentists, and your practice must have an online presence in order to be found. But your website isn't just for attracting new patients. Build in the capability for current patients to make appointments, check the results of their examinations, and get access to specials and deals online. It's a great way to keep patients engaged and make them feel like a partner in their own dental health.

Continue reading

Divorcing? Secure your Social Security

Divorcing Secure your Social Security

When you're divorcing, even if you're years away from retirement, you need to have your eye on the ball when it comes to Social Security. And not just your own benefits. One little-known aspect of divorce is, you may be able to receive a larger Social Security benefit based on your ex-spouse's work record than you would on your own.

You may be eligible to receive up to 50 percent of your ex-spouse's Social Security.

Make sure you have a good financial advisor who specializes in divorce, because the requirements can vary in terms of your eligibility to collect on an ex-spouse's benefit. Some requirements include:

  • Married for 10 or more years.
  • You are not currently married to someone else. (If you remarry, you cannot collect on your former spouse's benefit.)
  • If your second spouse dies, you are qualified to collect on his or her benefit if you had been married 10 years.
  • You must be 62 or older, unless your ex-spouse has died. Then you can collect at age 60.
Continue reading

Recently divorced? How your taxes change

Taxes and divorce

When you're filing taxes after or during your divorce, you may have some questions in mind. Here are some tax tips from the IRS for couples who are going through a divorce:

Filing status. Your marital status on Dec. 31 determines your filing status. If you are considered legally divorced on Dec. 31, you can file as single or head of household. However, if you're in the process of divorce, you may want to file a joint return instead of filing as married filing separately. You'll both get lower taxes if you file jointly. It's one thing that's a win-win for both parties, and an opportunity to cooperate.

Alimony. If your divorce was finalized before 2019, you can deduct alimony payments you make to your ex-spouse. The receiver must pay tax on the income.

Children. If you are filing separately, both of you cannot claim your children as dependents in any given year. If you are the custodial parent (having custody of the children most of the time) it is generally your right to claim them as dependents. However, this is another area that couples may choose to cooperate on, especially if the non-custodial parent is diligently making child support payments.

Continue reading

Maximizing your alimony agreement

Maximizing your alimony agreement

One important facet involved in the financial side of divorce is the issue of alimony or spousal support. It's a court-ordered payment from the higher-earning spouse to the lower-earning spouse, and is put in place to limit economic disparity and prevent economic hardship.

In the past, most often alimony was paid to ex-wives, who were homemakers, by their wage-earning husbands. But times have changed. Many, if not most, marriages include two wage earners, and the lines have blurred. The higher-earning spouse can be either one, regardless of gender.

Some things to know about alimony:

Alimony is determined by several factors, including:

  • The financial conditions of the two spouses
  • The standard of living during the marriage
  • The length of the marriage
  • The ability of the paying spouse to pay the alimony and still support himself or herself
  • The ability of the recipient to get education or training for a job
Continue reading

Recently divorced? How your taxes change

When you're filing taxes after or during your divorce, you may have some questions in mind. Here are some tax tips from the IRS for couples who are going through a divorce:

Filing status. Your marital status on Dec. 31 determines your filing status. If you are considered legally divorced on Dec. 31, you can file as single or head of household. However, if you're in the process of divorce, you may want to file a joint return instead of filing as married filing separately. You'll both get lower taxes if you file jointly. It's one thing that's a win-win for both parties, and an opportunity to cooperate.

Alimony. If your divorce was finalized before 2019, you can deduct alimony payments you make to your ex-spouse. The receiver must pay tax on the income.

Children. If you are filing separately, both of you cannot claim your children as dependents in any given year. If you are the custodial parent (having custody of the children most of the time) it is generally your right to claim them as dependents. However, this is another area that couples may choose to cooperate on, especially if the non-custodial parent is diligently making child support payments.

Health insurance expenses. Even if you're not the custodial parent, you can deduct your child's medical expenses if you pay for them (they're on your employer-paid policy, for example).

Tax credits related to the children. You can only claim them if you are the custodial parent.

Other tax refunds. If you and your spouse are expecting a refund, make sure to include it on your financial statement so it can be divided equally.

Sale of your home. If you're selling your home when you split up, you must consider the capital gains tax implications. Currently the tax laws allow for no capital gains tax on the first $250,000 of profit on the sale of your home if you have lived there at least two years out of the last five. Married couples filing jointly can exclude $500,000. However, after the divorce is final, each spouse can exclude $250,000 from capital gains tax.

The first step in that is finding a financial advisor you can trust who will help you create a road map for your solo financial future. At Harbor West, we specialize in helping people going through divorces wrangle their financial issues, so that you can concentrate on getting through this emotional time without worrying about money.

Disclaimer:

This information is provided for general purposes and is subject to change without notice. Every effort has been made to compile this material from reliable sources; however, no warranty can be made as to its accuracy or completeness. Before acting on any of the information, please consult your Financial Advisor for individual financial advice based on your personal circumstances.


 

Get Our Free EBook - 10 Things to Consider Before a Divorce

* indicates required
 

Financial Strategies for Dentists

* indicates required
 

How to prepare a financial statement for your divorce

How to prepare a financial statement for your divorce

Going through a divorce is an emotional, traumatic and even expensive situation. One of the most important parts of the process is each party's financial statement, which is required in all contested and some uncontested divorces.

Your financial statement, or affidavit, is a formal document that goes into your financial details, including income, expenses, assets and debts. Both spouses must fill out this statement and share it with the courts, and with each other. The purpose of this is to give the courts a clear understanding of a divorcing couple's financial situation.

It sounds like a straightforward and even simple process — income, assets, debts — but in reality it is a complicated endeavor. Making it more complicated is the fact that your financial statement is an absolutely vital part of your divorce that helps to determine your divorce settlement agreement. The court will use your financial statement to rule on alimony, division of property, child support and other financial considerations.

Continue reading

Renting a chair and other equipment vs. owning

Renting Vs Owning

If you're a dentist, you already know that it's a very equipment-heavy industry. Especially if you're entering a new practice or starting your own, you're likely faced with multiple decisions about whether it's best to buy or lease your equipment.

Here are some points to consider to help you make that decision:

Leasing isn't renting. And renting isn't leasing. You'll mainly encounter two types of equipment leases. One is known as an operating lease, or a true lease, and it is more of what most people would think of as renting, just like an apartment or anything else. It comes for a fixed period of time, and you may have the option to buy the equipment at the end of the lease with a certain amount of money down. A financing lease is similar to a bank loan.

Continue reading

Get Our Free EBook - 10 Things to Consider Before a Divorce

* indicates required
 

Financial Strategies for Dentists

* indicates required
 

cfp board9534FD1045B5478FF01F5336
Regulatory Disclosure: The information on this website has been obtained from sources considered reliable, but its accuracy and completeness are not guaranteed. This website is neither an offer to sell nor a solicitation to buy any securities. Gerard Gruber offers Securities and Investment Advisory and Financial Planning service through Geneos Wealth Management, Inc, Member FINRA/SIPC.  Investments are not FDIC insured. Investments are not deposits of the financial institution and are not guaranteed by a financial institution. Investments are subject to investment risks including loss of principal amount invested.