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 …
Inflation-linked Savings Bonds – High yield, Low risk!
Like many of my clients, you may have a dusty pile of paper savings bonds lying around somewhere. Maybe they belong to you or your children. Odds are they were gifts from an older relative. Most likely they are EE bonds, which have their charms.** However, the savings bond I want to talk about today is the I bond. Jason Zweig of the WSJ recently called I bonds “the best-kept secret in America”. I bonds were introduced in 1998. The “I” stands for inflation, which has been heating up recently. The variable inflation rate you earn on I bonds is adjusted every 6 months in May and November based on inflation as measured by the Consumer Price …
Have you looked at your Social Security statement recently?
The Social Security Administration recently started rolling out newly designed statements. The new statements graphically illustrate the increase in income from delaying benefits. Here’s the retirement benefit information from an old statement: From a different client, the retirement benefit illustration from a new statement: The new design helps workers get a better understanding of the income increase they can gain from delaying their benefits. It can make sense to delay claiming your benefit even if you have retired. It all depends on the numbers, but if you have other assets to draw on, holding out for a larger Social Security payment could be more …
