Your Unbiased Advisor: 2021 tax breaks

Showing posts with label 2021 tax breaks. Show all posts

Friday, November 26, 2021

Retirement budget: do a dry run now

Is Warren Buffett’s portfolio right for you?

Why does Buffett recommend buying and holding only two Vanguard funds for retirement? Is this strategy right for you too? In his letter to stockholders of his business, he wrote: "I believe the long-term results from this policy will be superior to those attained by most investors -- whether pension funds, institutions, or individuals -- who employ high-fee managers." Buffett credits “compounding” for his astounding investment success. So he advocates a low-cost index fund of the 500 largest companies as the best investment for most of us. He warns us against giving high-cost advisors our money since they can’t beat the index and their costs can take up to 63% of our potential accumulations. Nearly 92% of advisor funds have trailed the index of S&P 500 firms over the last 15 years. Over time, Vanguard’s 500 Index earned over 11% a year. That means your money doubles every 7 years. Your $250 per month contribution can provide you with $1 million in 35 years. Buffett proved his advice by beating a Wall Street guru with 5 hedge funds. Unless you are smarter than Buffett, Buffett’s way is right for you: https://www.amazon.com/Warren-Buffetts-Vanguard-Funds-Retirement/dp/1496148592

What do you own if you own a 500 Index fund?

Why is a 500 index fund growing so much? The Vanguard 500 Index fund has grown at 30% over the last year, 16% over the last 3 years, and 16% over the last 5 and 10 years. This is very unusual. Historically this index has grown at 11% per year. Info tech is the main reason for this trend as you can see by the largest contributors to the index’s growth. These corporations make up 30% of the Vanguard 500 Index fund:

1 Microsoft Corp.

2 Apple Inc.

3 Alphabet Inc.

4 Amazon.com Inc.

5 Tesla Inc.

6 Meta Platforms Inc.

7 NVIDIA Corp.

8 Berkshire Hathaway Inc.

9 JPMorgan Chase & Co.

10 UnitedHealth Group Inc.

If you own the companies in the index, you own some of these companies and their gains and dividends. If you pay low-fees like Vanguard’s version at 0.04%, your account grows faster than if you pay 1-2% a year. You own a broad diversified part of the world stock market. Use Warren Buffett’s strategy "A very low-cost index is going to beat a majority of the amateur-managed money or professionally-managed money."

Less you pay; more you earn: https://www.amazon.com/Warren-Buffett-Millionaire-money-snoring/dp/1508887381

Retirement budget: do a dry run now

What will you have to spend and what is your spending plan? Going on a journey like this one without a plan is asking for a disaster. You may need money to last 30 years—60 to 90—for at least one in your family. Stay ahead of inflation—the silent ‘killer.’ Unless you plan to work till you drop, a plan can help you succeed not just survive. If you began early enough you could have $2 million to spend without income taxes with the New American Retirement System. If not, you need to make a dry run now so you can make adjustments. You will need to make a Spending Plan for both of you. Estimate your Required Minimum Distributions from pensions and IRAs and how much tax you will have to pay. Find any old pensions and accounts you may have left behind.

You will need every penny. https://www.amazon.com/Your-Retirement-Budget-Investments-Income/dp/1483946487

Is a 401k annuity right for you?
Several mutual fund firms are offering an annuity guaranteed income from your 401k or 403b. Many workers have said they are interested in putting some of their retirement savings into an investment option that would guarantee them monthly income when they retire and help ensure they don’t outlive their savings. This makes sense for many since the guaranteed pensions of the past are gone. Employers do not want the risk of maintaining a pension payout for their employees for life. Recent law has reduced the fiduciary risk for employers and made it easier for them to provide annuities as a retirement plan distribution option. This may be a great option for you if you have other money invested to help defeat inflation during retirement. However, the monthly income guarantee comes at a cost. Firms take 1-3% annual fees to provide “monthly income you can’t outlive.” But the amount is cut in HALF by inflation over time. There are less expensive ways to obtain a “steady, reliable stream of income to help cover your expenses in retirement.” Be careful. Annuities are not cancelable.

Look at all options first: https://www.amazon.com/Best-Annuity-Strategy-Income-Growth/dp/1497532019

?**********ACCOUNTABILITY**************?

Like 1776, this period is a test of democracy—We rejected an "American fascist" once

The Path to Dictatorship

“The Coup is ongoing”

Vigilantism backstop

GOP: ”Be armed, be dangerous and be moral."?

GOP paying Trump’s defense

How Govt wastes our money:

Biden lets corporate taxes fall 21% to 15%; $80,000 SALT deductions for wealthy

Wealthy are outbidding each other for private airplanes: Biden gives them the money

Down HALF: IRS collections from estate tax dive from $20 billion to $9 B: GOP tax cuts

Manchin dictates what he wants in final Dem spending: parent help cut,

TX pays for Trump’s audit even though he won TX: TX GOP finally admits Biden won

SCAMS/SPINS:

WI: you can legally shoot three people during a protest and get off scot-free.

CO police: “too many guns are in the hands of too many students”: kids with guns!

Covid could take baby without mom’s vax: stillbirths likely for infected moms

Killing in “self defense” after you start the fight with weapons: victims don’t have a case

Children are allowed to carry loaded 30-round AR guns in WI streets: if over ‘foot’ long

What is with WI? driver kills 5 defenseless kids & marchers with SUV

Kenny Wells: illegally bringing/shooting his weapon in public: will this guy get off too?

Mesa County, CO clerk, swept by conspiracy theories, compromised election equipment

More Covid deaths in 2021 than 2020: more infections; fewer vax

FL gov no mask mandate gives parents no school choice: FL government like fed

Ron Molo IL caught stealing $800,000 using fake account: promised tax-free income

Evan & Avi Schottenstein FL caught abusing mother and accounts: failed fiduciary duty

Gregg Brie NY caught stealing $640K promised high returns in airline: 5 yrs jail

Mark D'Amico caught duped public $400,000 in GoFundMe scheme: fake homeless

Serena Shi caught selling condos in California that did not exist.

Stores caught claim original prices discounts when no such price listed

Goods caught fake “made in USA” sticker: trick of meaning

Tom Selleck caught pushing reverse mortgage product: Joins Madoff on Wall of Shame

Onion recall: Potandon Produce and Alsum Farms salmonella concerns: toss

Jobs

CVS closing 900 stores: reopening as health-care clinic: flu shots to diagnostic tests.

Amazon's buyout of Hollywood studio MGM

Unvaccinated employees are lying about their status to retain their jobs: peer pressure

Taylor TX new $17 billion Samsung chip plant: 2,000 jobs; 6,500 construction jobs

Germany raises min wage to €12 ($13.46) an hour, from €9.60 ($10.77) an hour.

Who owns your account now?

10 used cars that are going fast: demand raises prices—maybe you should wait

10 Least reliable new vehicles: most cost a lot for troubles: winner: Mercedes-Benz GLE

Verizon acquisition of TracFone Wireless

Miracles:

Child brings automatic weapon to protest in another state, kills 2: gets job in Congress

12 yo saves family and injured dog using Boy Scout-learned skills

TX voters don’t trust politicians to ban the right books: lynching by whites happened

Arbery judge: “self-defense laws do not apply to the person who is the aggressor in a confrontation.”

We can apply for Medicare online: https://blog.ssa.gov/apply-for-medicare-online

We can apply for Social Security online: https://www.ssa.gov/benefits/retirement/

We can apply for health care online: https://www.healthcare.gov/

IAN

41 Watchung Plaza, B242

Montclair, NJ 07042

973.746.2014

www.InsuranceAdvisorsNetwork.com

Alerts available at http://dankeppel.blogspot.com/

Friday, October 22, 2021

How much of your credit limit should you use?

Why is this question important to answer? Your credit score, which is used for everything from loans to rental agreements to job offers, is determined in part by your credit utilization—how much of your card limit you are using. Maxing out a credit card—having a balance equal to the card's borrowing limit—has a negative impact on your score. Folks with the highest credit scores often have (and use) multiple credit cards every month. So how much usage is too much? Most of us that pay all of our balance each month tend to have the highest scores. When I shop for a used car, I give the dealer permission to check my score. I know it is over 800 because I have been given a high limit but I don’t use it. When I bought a fridge recently, I paid with my credit card (to protect me if it didn’t work) and earned points. I had saved up before hand so I could pay off the monthly bill when it came due. Most credit bureaus do not cut your score if your ratio is under 30%. For instance, total cards limit $5,000, balance carried $1,500, ratio = 30%. People with the best scores tend to keep utilization under 10% for each card and for total credit card use, according to Experian.

Get the best deals: https://www.amazon.com/Insiders-Guides-Discount-Financial-Services/dp/143480593X

Is a South Dakota tax haven right for you?

South Dakota has become one of the most popular tax havens in the world. South Dakota offers everything a wealthy person setting up a trust could want. There is no state income tax or capital gains tax, so investment gains on assets placed in the trust are tax-free if it's structured correctly. Robust protections provide anonymity and shield assets from creditors and governments. And special provisions allow trusts established there to last forever, which means those assets would never be subject to the federal estate tax (40% for estates worth more than $11.7 million). However, the popular types of trusts used in South Dakota and Nevada have never been tested in a court of law. That means it's unclear if it would last. This trust, known as an incomplete gift non-grantor trust, or ING, could be challenged because the user is actually lying. They say they are hands off but they also claim they still have some control over the assets because the gift to the trust is ‘incomplete’. They claim they aren't tapping the annual $15,000 limit for gifts or the $11.7 million lifetime exemption before the federal gift tax starts to kick in. They claim a special ‘committee’ has to approve any payouts made to the creator of the trust.

Use the IRS approved tax haven: https://www.amazon.com/Your-Tax-Haven-Tax-FREE-working-Americans/dp/1482659441

How much tax will you owe for this year in April 2022?

With all the changes in income this year—unemployment, new job, child tax credit—etc, you may owe taxes that you have not had your employer withhold by December. So this calculator may help you understand where you stand: https://www.cvnb.com/calculator/tax-margin. Usually there is no penalty for under paying by December if you owe less than $1,000. If you will owe more, send in more by changing your W-4 with your employer or using this form: https://www.irs.gov/pub/irs-pdf/f1040es.pdf. You can wait to complete your taxes before April 15 and ask for a waiver of the penalty. There are no guarantees of course.

Consider changes: https://www.kiplinger.com/taxes/tax-law/603037/tax-changes-and-key-amounts-for-the-2021-tax-year

How to remove fake bad credit info from your credit report

Although one credit inquiry is not going to hurt your credit score it can affect your credit scores for up to two years. You may have looked for a new or used car or credit card or house, but that inquiry may also have come from some fake internet site or merchant trying to punish you. If you are not checking your credit report regularly, you will never know why you don’t get the best rate or rental deal. When you find the questionable hit on your report, don’t hire a credit repair firm. That may just add to your unfavorables. Use the online request form at the credit bureau to request bad info removal. Congress gave bureaus the right to ding you but not the responsibility to check data. You have to do it yourself. Thanks for nothing Congress! Around 25% of U.S. consumers found errors that could affect their credit scores in one of their credit reports. My report had data from someone in Long Island with my name and another from Maryland who stiffed a hospital and owed a lot of money. I filed the forms and got them removed after months. Bureaus don’t have a time limit on their failures. If they don’t act, use the sample credit dispute letters from the Federal Trade Commission. Let the FTC know about your dispute.

Show your child: https://www.amazon.com/Give-your-child-leg-manage/dp/1096505355

Is “personalized investing” right for you?

Headline: ‘Personalized Investing Coming Like a 'Freight Train'. If you were a broker/advisor this is sweet music to your ear. But guess what—this is just a marketing slogan for a sales person pushing the firm’s ‘selling list.’ And we get to pay through the nose for their guesswork. A Schwab employee said “investors were seeking an “even higher level” of personalization.” Yes, if your advisor asks enough questions about your situation and goal and objectives, they are bound to be able to find some securities that you personally will like. Yes, over time and through experience, your advisor should be able to assemble securities you feel meet your needs—but at what cost? Some picks will be winners and some losers and advisors don’t know. They can’t predict the future no matter how well they know your data. The reason passive investing has done so well for index users is that no matter how much you pay for ‘personalized investing,’ you may not do well. Warren Buffett who is not a sales person has proven that most folks do better without the ‘personal investing.’ The stats show you do better with an index alone.

https://www.amazon.com/Warren-Buffetts-Vanguard-Funds-Retirement/dp/1496148592

What is your retirement dream?

Some folks working to attain or maintain their middle class status are now questioning the path to their retirement dream. The pandemic and the shift in steady wage growth and asset building have made some folks reevaluate their situation. If they have had to change jobs and start all over again in a new career, can they ever catch up to their dream amount? Traditionally we have planned our retirements around the expectation of combining a pension, Social Security benefits, and personal savings to provide sufficient income for later years. These days we change jobs, our employers don’t pay pensions, and wages have been flat since the 70’s. The median retirement savings of Americans between the ages of 55 and 64 is currently zero. For those with retirement savings, the balance is less than in the past. Many of us have turned to ‘professionals’ with mixed results. It is estimated that retirement savers lose $17 billion to conflicted advice each year. This is a staggering sum that has real world consequences for retirees. Regulators have failed to fix the situation. The middle class has given up assets to the upper class. Here is how: One analysis shows that over a 50-year investing lifetime, that 2% [total annual cost of investment advice and trading] will erode 63% of what you would have had. At $250 a month, that means you will have $660,000 instead of $1.3 million. Some folks have solved this problem by doubling the amount they save/invest. Some have taken John Bogle’s advice and cut out the middle person by using index funds.

Dream and plan: https://www.amazon.com/Best-Robo-Advisor-Ultimate-Automatic-Management/dp/1537111957

**********ACCOUNTABILITY**************

Like 1776, this period is a test of democracy—We rejected an "American fascist" once

Our Jan 6 ‘Truth and Reconciliation Commission’

Seditionist Bannon snubs Congress: jail?

Capitol police help hide terrorist

Trump sues Jan 6 Committee to hide terrorist ties

Trump’s Big Lie: repeat repeat eventually believe

How Govt wastes our money:

What is wrong with this tax system? Workers pay 33-41%; wealthy pay 0.00001-17%

TX mandates business cannot reopen business if require vax: TX to control biz operation

Coal lobbyists determine Manchin vote on Dem budget: Manchin gets $491,949 a year.