Tax season is over and I am grateful my office coffee maker waited until April 20th to stop working. I enjoy coffee year round, but especially during tax season. You may find this strange, but I actually enjoy looking at tax forms so while it’s fresh in my mind I’d like to review one of the most common ones, the W-2.If you are employed, you receive a W-2 each year from your employer. The IRS and, if applicable, your state taxing authority also receive the form. Some taxpayers briefly contemplate their W-2 to prepare their own taxes. For those who outsource their tax prep, it gets thrown onto the pile of forms to give their preparer. Many don’t even take it …
When You Think About Investing, Don’t Think About The News
Today’s newsletter features a great article in the NYT by financial columnist Jeff Sommer. The news and images coming out of Ukraine are horrifying and my heart aches for the millions impacted by Russia’s aggression. It is difficult to imagine what they are going through. The article begins: The worse the news, the less you should think about it. No, that's not a good guide to life. but shutting out the din of current events is a reasonable approach when investing. Sommer speaks with Richard Thaler, a Nobel Prize winning economist who pioneered the study of behavioral economics. Follow the news, of course, and let your emotions flow. But don't let them affect …
A Stock Market Peak is not a Cliff
I ignore a lot of financial journalism. Much of it is noisy clickbait and not relevant to the long-term goal-focused investor. In fact some have dubbed it “financial porn”. But this headline, dated December 10th, 2021 from Marketwatch caught my eye: The S&P 500 is an index (group) of stocks that includes 500 of the most valuable companies in the United States. This index includes companies nearly everyone has heard of such as Amazon, Google, Microsoft, Facebook, Home Depot, and Tesla. Except for Tesla I’ve used each of these company’s products and you probably have too. The index went on to notch a total of 70 record closes in …
Give to Charity and get a Small Tax Break – even if you don’t itemize!
I’m talking to a lot of clients this month about charitable giving and how to give in the most tax-efficient way possible. Since Tax Reform took effect in 2018 fewer taxpayers are getting a deduction for their charitable contributions. Donations to charity are deducted when a taxpayer itemizes deductions.After Tax Reform far fewer people itemize. Only about 10% of taxpayers now itemize. The other ≈90% take the standard deduction. But in 2020 Congress addedanew tax break for charitable contributions made by taxpayers taking the standard deduction. In 2020 these taxpayers got to deduct $300 in charitable donations. This year, 2021, single tax filers can …
Three Years Later – Micro Investing with Acorns
Three years ago, I wrote about my lifelong passion (some would say obsession) for spare change. This dates back to counting the spare change and “egg money” in my grandmother’s chipped gravy boat in the 70’s. Today, this is the spare change stash in my office: But here in the 21st century, especially during a pandemic, I don’t have a lot of cash transactions, and therefore not a lot of physical spare change. Enter the micro investing app Acorns* which invests your digital spare change. Three years ago, I signed up for Acorns and linked my checking account. The checking account is my “funding source”. Then I linked my credit card. You can link more than one …
