Like many taxpayers, you might get a refund each year when you file your taxes. Last year ≈74% of individual tax returns resulted in refunds. The average refund was $2,476. It’s no secret that taxpayers use the tax withholding system as a form of savings. Too much tax is withheld from your paycheck throughout the year and then refunded back to you after you file your return. It seems like a windfall, but of course it isn’t. It’s really YOUR money the government has been holding for you. One argument against getting a refund -- you are giving an interest free loan to the government. However in today’s interest rate environment that’s not much of an …
What can we learn from the stock market in 2020?
We just finished one of the most tumultuous years in modern history. A global pandemic. Widespread civil unrest tied to policing and racial justice. A disputed presidential election marked by hyper-partisanship. Despite these challenges, the year demonstrated resilience of people, institutions, and financial markets. The 2020 global stock market with selected headlines*. (Click the graph to enlarge)Investors saw sharp swings in the stock market. The decline early in the year was sharp and swift. But despite a sequence of epic events and continued concerns over the pandemic, global stock market returns in 2020 were above their historical norm.What are some …
Can money buy happiness? Maybe.
Can money buy happiness?The answer is complicated – certainly money is important, there is no denying that.But does it make us happy? My colleagues and I have all worked with wealthy clients who are miserable. We also have clients of modest means who are not only happy but spread that happiness to everyone they come in contact with – including their advisor!Psychologists have have probed the relationship between money and happiness and have come up with some useful insights.Experiences make us happier than things.Spending money on others often makes us happier than spending it on ourselves.It is the season of giving and many of us are spending money on gifts. I recently discovered a way …
Help Those in Need this Year and Get a (Small) Tax Break
This isn’t exactly news, but it’s been a tough year. In the midst of a pandemic and economic crisis, many have lost income. Some have lost loved ones. Non-profits such as food banks are having difficulty keeping up with demand. Perhaps you have been more fortunate and have donated money to charity this year. Good news, Congress added a new tax break for charitable contributions this year as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Since Tax Reform took effect in 2018, fewer taxpayers are getting deductions for their charitable donations. Charitable contributions are deducted when a taxpayer itemizes deductions. After Tax Reform, …
Two Years Later – Micro Investing with Acorns
Two 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 and continues on today. 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 spare change. Enter the micro investing app Acorns which invests your digital spare change. Two years ago, I signed up for Acorns and linked my checking account. The checking account is my “funding source”. Then I linked my …
