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Affording Retirement

May 18, 2011 | Filed Under Finance, Investment, Retirement Savings | Comments Off

Are you among the 40% of working Americans that feel you will never be able
to afford to retire? A Harris Interactive survey of 1005 American workers,
reported figures to the American Institute of Certified Public Accountants,
that reveal the pessimistic outlook many Americans have regarding their
future days in the sun.  The study also showed that 55% of workers don’t
know how much they’ll need to retire.  Those who have some figure in mind,
are likely to underestimate how much they’ll need in savings.

The current state of the economy has left a hefty 56% of Americans who say
they can’t afford to save, and almost a third who feel they are financially
worse off now then they were a year ago.

“These statistics suggest we are on the verge of a retirement crisis in
America,” said Jordin Amin, chairman of the National CPA Financial Literacy
Commission(AICPA).  “Americans don’t know how to prepare for their twilight
years, and many have put off figuring it out because they’re struggling to
make ends meet now.”  Concerns over rising gas and food prices have 60% of
Americans interviewed by the AICPA Commission making adjustments to their
financial planning.  Worries over retirement however, are still looming over
90% of those interviewed, outranking concerns over uninsured medical
expenses, gas prices, and expanding educational costs.

The American Institute of CPA’s is trying help Americans gain financial
health through free educational programs and tools, and a task force of
volunteer CPA’s.

Despite the cloudy outlook, it is encouraging to find that nearly 60% of the
survey participants see savings as part of their lifestyle, regardless of
their current means to provide for it.

“Here’s  the best advice I can give for retirement planning: Start!”, Amin
said, “Set aside a $1 a day for an IRA, or $100 a quarter for a 401(k).
Small change adds up.”

In addition, the Commission offers these tips in establishing a financial retirement

  • Track your expenses for three to six months. Then think about how those expense                                                might change in your retirement years.
  • Create a concrete plan, determining how much you’ll need to save.
  • Develop a transition plan.  Many Americans reaching age 65, discover that their working                                           years still lie ahead.  Consider doing part-time or consulting work to supplement                                                      your  savings in order to transition into full retirement.

For more personal counsel about retirement planning, contact Shari Mattingly-Bevan
& Associates to help get you on track  for retirement.  864-283-6906 or

Planning for Retirement

April 19, 2011 | Filed Under Finance, Insurance, Investment, Retirement Savings | Comments Off

The National Retirement Planning Coalition, a group of prominent financial industry, educational and advocacy organizations, is working to raise public awareness of the need for comprehensive retirement planning.    The members of the Coalition believe it is still possible to “Retire on Your Terms” if comprehensive retirement plans are properly developed and managed. This week the Coalition sponsored the National Retirement Planning Week to help raise awareness and educate Americans.

Cathy Weatherford, CEO and President for the Insured Retirement Institute (IRI), which heads the Coalition, said, “ Planning for retirement can be a daunting task, especially given the recent economic climate. And while by most accounts the financial forecast appears to be improving, millions of Americans have yet to begin preparing for their retirement.  Wanting to spend their later years content, secure and financially sound is the goal of anyone thinking about retirement.”  The IRI has developed a consumer guide to aid in planning for one’s retirement.  Their “Top 10 Ways to Prepare for Retirement” are useful tips to map out a course for a secure financial future.

Top 10 Ways to Prepare for Retirement:

  • Select a target date for when you want to retire.
  • Calculate how much money you need to accumulate by the time you want to retire.
  • Find out how to maximize your Social Security benefits.
  • Take full advantage of tax-advantaged plans such as employer retirement plans, individual retirement accounts and annuities.
  • If you employer doesn’t have a pension or retirement plan, ask that one be started.
  • Don’t touch our savings for anything but retirement.
  • Diversify your assets and be sure to include guaranteed income for life.
  • Ask questions.  Get help.  Seek the assistance of a professional financial advisor.
  • Start now, set goals.
  • Do a retirement plan and monitor your progress.

Just a few short years ago millions of Americans relied up their employer sponsored retirement plan to achieve their future financial goals.  But with more than 2.4 million active 401(k) participants affected by employers suspending their savings match at the beginning of the market decline, along with so many others who have lost jobs or have had their employer benefits reduced, it is even more vital now that people meet with an ethical, and competent financial advisor to start a retirement plan today.

Please contact Shari Mattingly-Bevan & Associates for additional information on retirement planning solutions at 864-283-6906.

Financial Wisdom from Benjamin Franklin

April 14, 2011 | Filed Under Finance, Investment, Retirement Savings | Comments Off

“Buy what thou hast no need of and ere long thou shalt sell thy necessities.”

Quote-Benjamin Franklin lived from 1706 until 1790. He was one of the most well-known Founding Fathers of the United States, an author, printer, scientist, politician, publisher, inventor, philosopher, civic activist, and diplomat.

Fixed Indexed Annuities Ideal in Today’s Market

April 8, 2011 | Filed Under Finance, Investment, Retirement Savings | Comments Off

Between 2007 and early 2009, variable and traditional fixed annuities have been the leaders in the annuity market.  Since mid 2009, however, fixed indexed annuities have led the way.  An indexed annuity is a product that allows the owner to have the advantages of gains linked to the stock market without the risk of loss to principal.

Why the shift, what does fixed indexed annuities have over the traditional or variable annuity? According to Joseph Montminy, assistant vice-president and head of annuity research at the Windsor, Conn.-based insurance industry group LIMRA, is that, “Equity market volatility and the ability of Fixed Indexed Annuities to partially shield policyholders from that volatility, while also affording them a measure of upside participation, is a major selling point.”

Insurance companies are also working to simplify and fortify their Fixed Indexed Annuity products to attract more clients.  Products with shorter surrender periods, and optional guaranteed lifetime withdrawal benefits, similar to those available with variable annuities, make fixed indexed annuities highly competitive with their counterparts.

Time for a Financial Check-Up

April 1, 2011 | Filed Under Finance, Insurance, Investment, Retirement Savings | Comments Off

We’re coming to the end of the first quarter of 2011, and if you haven’t taken time to examine your financial plans, now is a perfect time to take a fresh look at where you are heading financially.

I encourage you to meet with your qualified planner or contact our office to assess the current state of your finances.  Your advisor should help you to re-evaluate your financial plans and show you how to make any necessary changes that move you closer to your goals.

Here are some things to consider:

  • Are your plans still providing comfort, confidence and security?
  • Are they keeping track to fund your retirement or do you see yourself outliving your money?
  • Is your desire to leave a financial legacy behind for your loved ones still possible?
  • Be sure that you are living within your means.
  • Communicate your plans with loved ones so they can follow through with your wishes in the event of the unexpected.

The future is as uncertain today as it was last year, or 80 years ago.  Reviewing your financial plans every year with a trusted financial advisor, will help you face the challenges in the future.

“Change is only painful if you lack knowledge about how to prepare for its consequences.”  [1]

[1] Van Mueller, LUTCF

Annuities – Good For Your Portfolio

March 16, 2011 | Filed Under Finance, Insurance, Investment, Retirement Savings | Comments Off

“Retirees may get more financial security by combining insurance products and mutual funds, some analysts say”

This week in the Wall Street Journal, an article appeared entitled, “Making the Case to Buy an Annuity”.  The article addresses the importance of adding  annuities with lifetime-income guarantees to your retirement portfolio.

When the stock market makes a downturn during the early years of your retirement, you may face running out of money, if you are  invested in the markets.  Annuities with lifetime-income guarantees can offset that risk.

The importance of annuities and income riders was highlighted by Chief Investment Officer of Morningstar, who said, “”The longer we live, the greater stress that puts on our ability to pay for our retirement-income goal, an income stream that lasts as long as we do.  We need to go beyond the universe of mutual funds and ETFs and consider longevity-risk products.”

According to a researcher, “a typical 65-year old should have as much as 50% of their money in annuities, and the typical 75-year old should have about 65% invested through annuites. ”

There are two main types of annuites, variable and immediate, or indexed.   One important disadvantage to variable annuities is the typical high fees compared to the lower fees of an indexed annuity. Both, however, can provide life-time income.

For additional information on this topic, please contact me at Shari Mattingly-Bevan & Associates at (864) 283-6906.

To read the full article, go to

Inheriting Trillions

February 26, 2011 | Filed Under Finance, Investment | Comments Off

A study conducted by the Center for Retirement Research at Boston College in January of 2011, indicated that approximately $8.4 trillion will be inherited by baby boomers. Those to inherit the most will receive an average of $1.5 million, while the least wealthy will average about $27,000. That translates to roughly $64,000 per person.

The study also estimates that two-thirds of the baby boomer generation will receive some inheritance.

In addition to the $8.4 trillion, some baby boomer parent’s will transfer a portion of their wealth to their children while they are still living. That would estimably increase the total transfer of assets between generations to $11.6 trillion.

The writers of the study concluded their paper with this caveat:

“It is important to stress that most boomers have not yet received any inheritance. And the amount and timing of inheritance receipts is highly uncertain. Even parents who have a strong desire to leave a bequest may be forced to revise their plans based on fluctuations in the value of their assets. Or they may exhaust their wealth as a result of medical and, especially, long-term care costs. In short, an anticipated inheritance may not materialize. Even when inheritances do occur, recipients generally get the money when they are older and the amounts are typically not large enough to be life-changing. Therefore, boomer households need to make many of their key financial decisions before they ever receive any inheritance. And they should not count on an inheritance to eliminate the need for increased retirement saving.”1

[1] How Important Are Inheritances For Baby Boomers? By Alicia H. Munnell, Anthony Webb, Zhenya Karamcheva, and Andrew Eschtruth*© 2011, by Trustees of Boston College, Center for Retire­ment Research

Shari Mattingly Bevan- “Managing Risk”

February 24, 2011 | Filed Under Finance, Investment, Retirement Savings | Comments Off

Managing risk successfully in various areas of one’s life requires
knowledge, skill, and a little bit of luck. When evaluating any investment,
risk exposure is central to the determination you make. Typically, the
better the return, the higher the risk. Before, you can make the best
choice for you, you need to understand your own comfort level of risk.
Personal circumstances, preferences, personality, knowledge base, affect
one’s ability to handle different levels of risk.. When you are reviewing
your portfolio or considering a new investment, your primary thought should
be how much risk are you willing to bear, can you withstand the potential
loss, and then to consider what returns might you gain. Whether, your
neighbor invests in derivatives and has gained a small fortune, or you are
focused solely on a rate of return those should not be what drives your
investment decisions.
The goal of investing is better expressed as having enough cash on the day
a bill comes due.

The New Estate Tax Law and Gift Tax Exemption

January 11, 2011 | Filed Under Finance, Investment, Retirement Savings, Tax Articles | Comments Off

As most people are aware, Congress passed a new estate tax law just prior to the end of calendar year 2010. Not only was the estate tax law changed, so was the lifetime gift tax exemption, as well as the generation skipping transfer tax exemption.

First, the estate tax exemption was increased to $5 million per person from the prior law, which was scheduled to sunset and be reduced to $1 million dollars. This is a $4 million dollar increase in the amount of wealth that an individual can die with, before the federal estate tax law applies to an estate. There is no way to describe this law change other than it is a windfall to taxpayers. Very few people have estates that are subject to estate tax and most of these people either reside on the east coast or west coast, due in large part to real estate values. Although this is a tremendous windfall to taxpayers, the counterargument is that the reduction in estate tax revenue to the federal government will hinder the government’s ability to decrease the federal deficit that is currently spiraling out of control.

The estate tax exemption is also now portable between spouses. This means that if spouse #1 dies and doesn’t need or use all of his or her $5 million exemption, the unused portion is portable or transferable to the surviving spouse. For example, husband dies and has an estate worth $3 million. His surviving widow can aggregate the unused $2 million exemption of her late husband and add it to her $5 million exemption, so she now effectively has a $7 million exemption. This provides for huge tax planning opportunities for wealthier people. Amounts passing to a US citizen spouse and to charity don’t count against the exemption amount.

Second, the lifetime gift tax exemption and the federal estate tax are once again unified; meaning both are set at a $5 million dollar exemption amount for 2011 and 2012 and are tied together. This concept is confusing for many people, so hopefully this will add clarity to the subject. Each year, you may gift up to $13,000 to any person (unlimited in number). This is referred to as the annual gift tax exclusion amount. If the amount of the gift is over $13,000, then it is subject to gift tax and reduces the amount of one’s lifetime gift exemption of now $5 million dollars. The reduction in the lifetime gift tax exemption also reduces the estate tax exemption because the system of gift and estate tax is designed to limit the amount of wealth that can be transferred either during lifetime or upon death. However, tremendous gift planning opportunities are available, without paying a gift tax, to reduce the size of an estate so that an estate tax will not apply upon death.

Lastly, the generation skipping transfer tax exemption, which is an additional tax imposed on transfers of assets to a “skip generation”; generally, one to grandchildren when the parents are still alive, is $5 million, up from $1 million in 2009. When this $5 million GST exemption is leveraged with advanced wealth transfer techniques, such as a grantor retained annuity trust or an installment sale to a trust, wealthy clients will be able to transfer vast sums, tax free, to trusts for their children, grandchildren and generations beyond.

With these new tax law changes, it is critically important to revisit your estate plan. Planning opportunities abound for people with substantial wealth.

Lenders Still Tightening Credit in the Housing Markets

December 15, 2010 | Filed Under Finance, Investment, Real Estate, Retirement Savings | Comments Off

The housing market may be headed for another downturn, according to some economists, because mortgage lenders continue to tighten the already restrictive lending standards for home loans.

Earlier this year, the housing market was buoyed by the home-buyer tax credits, but sales have plunged in the second half of the year after the tax credits expired. New and existing home sales were down by more than 25% in October from a year ago.

Even though mortgage rates are at the lowest in 60 years, mortgage applications are hovering near their lowest levels in more than a decade. Housing economists are very concerned that tight credit at the bottom of a housing cycle could result in continued retardation of the hoped for recovery. An expanding housing market will usually help lift an economy as it exits a recession, but in this current market, it appears the glut of foreclosures will continue to hit the market without buyers who can qualify for home loans due to restrictive lending parameters. Because the lending standards have increased significantly, the housing market will not be propping up the economy in the near future. Economists say lending standards typically ease at this point in the business cycle as banks look for new business. Banks are not looking for new business at this point, could it be because they are flush with cash from the Troubled Asset Relief Program (TARP monies)? If banks were not in possession of the TARP cash, would they be looking for new business? Did the TARP money to banks interrupt the normal business cycle which will lead to prolonged financial difficulties for consumers? It appears the more big government spends, the more consumers experience financial woes.

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