Titles in the financial services industry can be very confusing and downright misleading. Cue my opportunity to focus on the term fee-only when it comes to hiring an adviser in comparison to other terms. This is a topic that is dear to me because there are a ton of financial services professionals and we all fill various rolls and needs for clients. While some argue that there are conflicts in every arrangement, clients really need to understand what they are paying for and especially how they are paying their adviser. That, in itself, could be another post. For now, let’s focus on fee-only vs. fee-based.

I frequently see what people are holding in their investment accounts when I review them. Sometimes, I am pleasantly surprised; other times, baffled. One thing is clear, the message that you should diversify is starting to get through. What’s not getting through is how you should diversify. Most folks have to rely on a selection of funds in their 401(k) plan. Granted, some 401(k) providers still don’t offer a lot of options. That said, you can avoid picking your own individual funds by using a target-date fund in your 401(k) if available. Yes, I know, not exciting but a target-date fund does get the job done. But let’s say you have a greater selection available to you, or you want to diversify your own taxable investment account. Where do you start? Read on…

Tax is a huge component of financial planning and tax questions are always top of mind for many folks. It’s our IRS and financial press that focuses on this topic relentlessly. They need to – it’s everchanging. With each Congress taxation seems to change and it can be like watching a tennis match trying to keep up. I’m not sure which I hear most, questions about investments, or tax questions? It’s a toss-up. With that said, you shouldn’t necessarily let taxation be the sole driver of reaching your future goals and your overall financial plan.

There’s a big difference between being cheap and being a savvy shopper. You can buy quality without busting the bank and shopping can be a lot of fun. No matter what you are shopping for, we all are influenced by our past experience, marketing, and legacy advertising. What is legacy advertising? Think of a brand name that you have heard of or seen from your earliest childhood memories. For many of us it could be big soda companies, car producers, shoes, and maybe a couple of blue jean manufacturers. You already know their names and iconic brand logos without me telling you. You can still rattle off classic marketing slogans. But there’s more to being a savvy shopper than just recalling a brand name and its slogan.

Whether you are traditional, sixty-something retiree or a young acolyte of the FIRE movement, preparing for retirement is much more involved than picking a date and letting HR know. It’s not something to be undertaken lightly. You need to be just as prepared mentally as financially. You also need to adjust to a new manner of cash flow, both in and out. Big changes await and I am not just talking about being able to slack off on email and sleep in.

It’s a conundrum many families face: save for retirement, or fund a child’s education? For a lot of families, education is a very high priority. It’s also a way of showing love for their child. Many parents struggled to put themselves through school and pay off student loan debt and they want to remove that future barrier for their child. It’s admirable and it does show love. Financially, though, it may not be the best choice.

Many people who work in sales and marketing refer to the final quarter of the year as, OND – October, November, December. OND is a heady rush of holidays, finalizing projects, using up your department budget at work, and spending time with family and friends. I joke that it’s the start of one big holiday, HallowThanksMas; Halloween, Thanksgiving, and Christmas all jammed together. Better start that diet now before all of the dinners and parties. OND is upon us so what should you be doing for OND from a financial planning perspective? Let’s take a look at a brief overview of each month.

Christmas is about 14 weeks away as of this writing. Recent news shows have been discussing our supply chain delays and disruptions and this might lead to massive delays if you wait until December to order gifts for delivery. My gift to you is advice on how to avoid that trouble. Not everyone celebrates Christmas but for a large number of families this is a major holiday and a very big expense. I’ll give you some budgeting tips as well. Christmas can be fun, but it puts many folks into a financial tailspin and creates unnecessary stress. So, how do you prepare for the expense in your budget, get your gifts on time, and avoid the tailspin and reduce stress?

As you can imagine, this question is on the minds of a lot of people right now. Rates are still flirting with historic lows, so many folks are looking at their mortgage statement and comparing current rates and offers they see in ads. Whether you should refinance depends on many factors other than just the rate. Here are a few key points to consider, but remember, run the numbers!

Recently I’ve been seeing ads by one of our nation’s largest brokerages. In the ad, the broker (an actor) has a captive group of clients seated at a conference room table and he asks them to turn to a specific page number in their financial plan binder; a rather high page number. At this point, the clients start asking questions, good questions, about changes and real life situations. The ad annoys me for several reasons. Let me explain a couple of those reasons.

This past week a client asked me this very question. It’s actually a conundrum that many people face and wonder if they should be tackling all of their debt at one time versus saving and investing. As you can imagine, it really depends on personal circumstance and the amount of debt you have. First of all, it depends on the type of debt. Second, it depends on how much you are saving for retirement or other goals. Let’s take a look at what to do.

Recently, I wasn’t feeling well for several days. I thought it was due to the smoke from our wildfires. That usually bothers me each year. Then I thought maybe I was catching a cold. Given that I haven’t had a cold, flu, or any real ailment in years, it was unsettling that the symptoms were not abating. Out of concern for my husband who I knew would be home in a couple of days, I decided to do a rapid COVID test and to my surprise, it was positive! I was shocked because I work from home, don’t circulate a lot, and I’ve been vaccinated since April. Where and how I came into contact long enough to contract COVID is still baffling, but not something I’ll ever really know. My idea was to self-treat and stay home which is what guidance suggests. Boy, did that go sideways!

Despite all the ratchet jawing by politicians every election cycle, one thing is clear. American families are not seeing much progress in the way of making college more affordable. In fact, here in California, our UC system just announced new tuition increases! True, some junior colleges are finally offering free or reduced tuition, but not nearly enough institutions do so. Many Gen-X and Millennial parents do not want to see their child leave school with the tremendous student loan debt we hear so much about. Among parents, 529 plans have become the go-to product for saving and investing in their child’s future. But is this the best approach?

Build back better by being a better budgeter! Ok, enough with the b words. Budgeting is a crucial building block to wealth and a key part of the financial planning process. It also seems to be the most hated aspect of personal financial planning. Most folks would rather go to the dentist than sit down and do their budget. I get it, for most fun with numbers really isn’t. I also think a major stumbling block to budgeting is that it can be revelatory and not in a good way. When we actually record and track our expenses, it can reinforce that we know our spending habits need to change. Instead of being proactive, many react by continuing the same behavior to avoid making the changes needed. Retail therapy, anyone? Budgeting doesn’t have to be complicated.

It’s interesting to hear folks talk about their FICO score. It’s even more interesting to hear some of the myths people believe will affect their FICO score. Most are not even sure what FICO means and yet it’s a number that rules our lives. FICO comes from the names of the founders, Bill Fair and Earl Issac, who started a data analytics company to score credit usage back in 1956. The company was founded in San Jose, CA and FICO comes from Fair, Isaac and Company. If you are concerned about your FICO score, as you should be, here are three quick tips that will help you improve your score.

Often, people ask me how to improve their credit score. I usually respond by asking if they have checked their credit report. Usually, the answer is, no. Sometimes I hear that they have free credit monitoring and fraud alert through their bank, credit card, or some combination thereof. This is not checking your credit report.

We have had it drilled into us to save, save, save from our first job to prepare for retirement. We have also learned that we need to invest that money to make it grow. As we age, though, we have less tolerance for market risk than when we are young. This usually forces investors to reduce their equity exposure as they age. What if we had a way to take on higher risk up until retirement and still have access to our personal savings and investing like a qualified retirement plan (i.e., a 401(k) plan) along with Social Security? That is, could we as a nation replace the notorious third leg of the retirement funding stool? I think we can.

Given that we are well into fire season, and just had an earthquake swarm this week, it’s time for my annual reminder to have a Grab-N-Go emergency binder! We jokingly say that we have four seasons here in California: flood, fire, earthquake, and riot. These days, with COVID-19, disease is playing a part as well. It’s necessary to have an emergency binder for other reasons as well. Most notably, a medical emergency. It’s not a pleasant thought, but a disaster or health crisis is an event for which we should all plan ahead.

It looks like a lot of you have left something behind. What is it? MONEY!! According to Money.com, Americans have left a whopping $1.35 trillion behind in old 401(k) plans with an average balance of $55,000. Unbelievable... that's a lot of money. It can also be a problem when you hit your RMD years and think you have calculated your RMD correctly.

If the IRS is handing out money, it really must be Christmas in July. That’s right, starting July 15 parents will start to receive the first payments of the advance Child Tax Credit (CTC) as a monthly cash amount. This is the result of the American Rescue Plan Act (ARPA) of 2021. Right now, ARPA expands the CTC only for tax year 2021. The jury is still out on whether this will continue as a benefit for families. I expect, and hope, that some form of this may become permanent for families who can use the extra cash each month. The Biden administration has already signaled a willingness to extend the program for five more years. So, how much is it, who qualifies, and what should be done with that money?