When I was in junior high there was a girl I liked.  A lot!  She couldn’t hang out with me because her dad said no.  We were too young, definitely couldn’t be dating at that age, and he was being a good father.  At her next basketball game I walked up to him and said “Hello, I’m Ed Kinsey, and I like your daughter.”  He and I then spent time together watching her play, and I was able to then spend time with her. 

 
As junior high love goes, we later moved on to other infatuations, but I learned a great lesson from that experience.  When you want something, ask for it.  It is your best chance at getting what you want.  One of my favorite things to ask for is knowledge.  I love to learn from others.  It’s less painful than learning from my own mistakes and the varying points of view and life experiences are extremely insightful and often entertaining as well.  I especially enjoy asking successful individuals what they learned in their journey of success.  From a financial perspective, here are 5 principles I’ve learned from “quiet” millionaires, those who are the wealthy incognito.   These 5 principles may seem a bit sporadic and random, but they are exemplified by nearly every wealthy person I know!

 

1- Income and Wealth are not the same thing- The single most consistent thing I see in the wealthy I work with is the habit of spending less than they earn.  You might say “It’s easy for them, they’re rich!” but truth be told most of them had lived within their means and stuck something away for a rainy day even before they were wealthy.  Saving and then carefully getting money to grow is key for anyone that desires self-made wealth. 

2- Know where your money goes- in tandem with point number one is the need to track your spending.  Spending with a purpose and understanding where your money is being spent are key.  Case in point: A few years back I was doing some strength coaching for the son of a wealthy family.  They insisted on paying me, though I was happy to train the young man for free as they were good friends, so we settled on $20 per session.  After getting a $40 check and not cashing it for two weeks, I received a phone call from the mother of the young man wondering if I’d lost the check.  This wealthy woman was still worried about $40.  That level of dedication to tracking their money is what really made this family wealthy.  

  

 3- Take responsibility- wherever you are financially, it’s your own fault.  Sure, there are plenty of people who have caused you problems and cost you your wealth, and those who lucked out and inherited wealth.  More often, however, are those who earned it through hard work, effort, determination, and other words we like to avoid.  They owned their life, including the financial part of it.  They decided what they wanted and they consistently worked for it until they got it.  Take responsibility for what you have, and for what you don’t have.  Then commit today to go get what it is you want to have.  If you need a reason to do that, do it because that’s what all the cool rich people do J Besides, it worked for Harry Truman, 33rd President of the good ole’ US of A.   

4- Home matters- swapping out spouses and trading in homes is expensive.  Two of the most costly things we see in society today are restarting a mortgage and ending a marriage.  Mortgage payments on homes are nearly all interest for the first 10 years and, on average, people stick with their mortgage for only 7 years.  Through refinancing and through unnecessary moves, we kill our financial plans and give thousands of dollars to the bank each year.  Try to stay put in your home rather than upgrading every chance you get.  Upgrading neighborhoods can also be a drain on your finances.  We all want to fit in and seeing our neighbor’s new (insert whatever you are coveting here!) makes us want to go out and buy the same thing.  Modesty is a great virtue when it comes to the home.

 

The same holds true for your spouse.  Broken marriages are costly.  Not only do they cause great stress and hardship emotionally, divorce also wrecks personal financials.  From the dividing up of household debt, attorney’s costs, and the loss of productivity to the one household’s income suddenly needing to cover two households worth of expenses, divorce is rough on the finances.  Instead, go get some professional help, put in the work it takes to have a great relationship, and try to salvage your marriage.  It doesn’t always work out, but if it can, it is to your financial benefit. 

 

5- Money doesn’t buy happiness, but controlling it does- Spending with a purpose provides gratification and is less –likely to lead to buyer’s remorse.  Living within your means brings great peace and some real financial confidence. An added bonus of understanding that “status” purchases don’t bring happiness helps us to save more and waste less.  So don’t let your money control you and don’t try to buy happiness.  Use your money to do things you enjoy, save for a rainy day, and build up a nice security blanket so you can live financially stress free.

Reports show that less than a third of couples who plan a wedding that costs more than $10,000 save more than a couple of thousand dollars toward paying for it. Yet Weddings today can cost an average of $20,000 or more for the reception hall, caterer, flowers, decorations, Wedding gown, Rings, and don't forget the honeymoon. So how do you pay for all this extravagance?

1- Save for your wedding. Certificates of Deposits ( CDs) offer one option for short-term savings that offers higher returns on the initial investment. Having a regular savings plan to save as much unrestricted income as possible in the months preceding your wedding can help you to accumulate as little debt as possible. Saving coins and $1 bills in the months leading up to your wedding can add up too, perhaps contributing a decent down payment toward the honeymoon.

2- Talk to a representative at your financial institution. Many banks offer free advice to couples about budgeting, savings and purchasing a home. Inquire about a home equity loan to help cover wedding expenses. For engaged couples who may already own a home either individually or together, a home equity loan provides a flexible option for financing along with low interest rates.

3- Set a Realistic Budget. Be careful of hidden costs. Don't make the mistake of going over budget. Be prepared as a couple to compromise on many of the details. Consider using a combination of savings, paying out-of-pocket, home equity and credit cards to finance the cost.

4- Pay as you go in order not to incur debt. Even if you don't have a lot of excess cash, you can pay off many of the bills related to a wedding beforehand. Most vendors require a 50 percent deposit at the time that you place the order. this gets you halfway there from the start. And Remember, all cost are negotiable.

About this Author: Kelli Roethel has 5 years experience in the Health insurance industry as a Cobra specialist. She is owner, co-founder and Manager of the Life1010 program, which is designed to help individuals through a step-by-step process of getting their lives and businesses in order. The program focuses on emergency preparedness, creating an effective spending plan, health and wellness, and retirement planning. She has helped the business in creative aspects of social media and event planning.  Kelli as a part time stay at home mom enjoys helping others get their lives organized. Loves the joy of watching others realize how important it is to be 
prepared for life’s crazy ups and downs.

The average person would likely tell you that the main reasons for purchasing life insurance are to replace income in case of early death, pay funeral expenses, and basically make sure that a beneficiary or family is not left destitute as a result of an unexpected death.

However, while these purposes are important, this type of thinking ignores the fact that that life insurance can also be an extremely effective way of preserving or even creating an estate, providing a tax-free benefit for heirs, or creating a tax-free source of funds that can be used to pay the estate taxes

If you are a parent without a large estate, but want to pass along a nice benefit to your children or grandchildren, a permanent life insurance policy can accomplish this.  It provides a guaranteed tax-free death benefit that can be divided cleanly amongst beneficiaries.  Likewise, if you are a parent with a decent sized estate, a life insurance policy can be an effective way to both maximize the inheritance and provide a tax-free source of funds to pay estate taxes in a quick manner.

In some cases, life insurance can also serve as an effective estate equalizer.  For example, many estates are comprised of assets that are not easily divided, or at least not agreeably divided.  For many families, the bulk of the estate is comprised of property.  Maybe one heir desires to preserve the asset while others would prefer cash instead.  Life insurance is a great way to equally divide the estate without finding ways to divide assets such as property or provide for joint ownership.

These are just a few common and basic uses of life insurance as an effective estate planning tool.  However, it is very underutilized mainly because most people are unaware that life insurance can and should be used for these purposes.

About the Author: Marc Roethel has over 7 years experience in the life and health insurance and retirement planning industries.  He is CEO and co-founder of the LIFE1010™ program, which is designed to help individuals through a step-by-step process of getting their lives and businesses in order.  The program focuses on emergency preparedness, creating an effective spending plan, health and wellness, and retirement planning.  He is also co-author of the book "Not Yo Mama's Retirement Plan", which takes a fun and easy to understand approach to a risk-free and tax-free solution to retirement that is proven and mostly unknown by the majority of the population.

There are many types of trusts, but I want to speak to one particular type of trust.  That of the REVOCABLE LIVING TRUST.  There are some people that disagree with me on this, but I feel like this particular instrument is one of necessity in your plan.  It should be a goal of each of ours to get to a place where we can have a trust implemented.  This is assuming you have enough in assets to want to pass something on to beneficiaries.  Things like real estate, bank accounts, investment accounts, and the like.

But I don’t have enough money for a trust- this is the first of the excuses I hear when I recommend a trust.  To be frank, those with lower amounts of money (who knows what that means) need to have a trust simply because they’re not going to have the money to come up with court costs, probate fees, lawyer fees and the like.  Granted, you can have things like you IRA’s and life insurance properly designated to beneficiaries, but what about real estate, savings accounts and brokerage accounts.  Amongst all the costs that could be incurred, a $500-$1500 charge to get a trust in place is a small investment.

What a trust “buys” you- a trust allows you to bypass probate first off.  Probate is the headache and costly process of putting your property, upon death, up for grabs to any supposed creditors.  Trusts provide a nice safety net that way.  Guardianship is another concern.  Assets that have trusts as beneficiaries allow minors to not have to wait for a court to set up guardianship before the life insurance pays out.  Or if the beneficiary dies along with you, like in a car crash for example, the proceeds go to the estate and then have to work through the probate process.  Guardianship fees can cost $1000’s.  Incapacity is one other area where trusts are very helpful.  Trusts allow you a very robust platform for you to dictate what happens in the event you are incapacitated. 

Wills vs. Trusts- Typically we recommend considering a will along with the trust, but so you can distinguish between the two…  A will is public, through the probate process; a revocable living trust is generally private.  Wills don’t define an estate, they only dictate where assets should go if no other creditors lay claim to them first.  Wills instruct how to pay the taxes and debts, which should manage property, name guardians for children, etc.  So in short, you should consider having both a will and a trust.

In summary, a well-drafted trust, by a competent attorney, is an extremely valuable asset that can save you and your beneficiaries in both money and headache.  

About this Author: Ed Kinsey has been in the financial services industry since 2003. He has experience in Real Estate, Mortgages, Commercial Finance, Annuities, and Life and Health Insurance.  His goal is to benefit the lives of one million people. He want companies to start providing better benefits at lower costs through our services. He wants to enlighten people to the retirement benefits available through life insurance, the only tax free retirement option. We have secure solutions.  Ed is also a world ranked powerlifter and fitness enthusiast.

 Here are some reasons why it is important to have an annual consultation with your financial and insurance advisor(s): 




1-The landscape of what is available in the insurance and financial industries is constantly changing and evolving.  It is important that you are aware of the cutting edge products in the industry that could be a significant upgrade from what you have and save you in premium dollars.  You may have an older product that is underperforming severely compared to other potential options, but you leave it simply because you are unaware of other options!  It is your advisors responsibility to make you aware of the best options for you on a continual basis!




2-A consultation goes a long way in keeping you informed and educated in your knowledge of how your policies work and why they are important now and in the future.  This gives you great peace of mind in understanding how you are protected and what your retirement will look like!  Most of us need a refresher every now and again so that we at least have a basic understanding of the concepts of how things work.  For example, I am not an expert on mortgages and how they work (because I don’t do mortgages for a living), but gain great peace of mind just by understanding the basics of how my mortgage is set up.  However, a lot of what I have learned recently may become very foggy in the months to come, and I will likely need a refresher on my mortgage after a while also!




3-You need to know that your advisor is still heavily involved in the business and therefore up to speed with all the current best products in the industry.  Many advisors are semi-retired or lower their activity level in the business after a time, and consequently are not up to speed on the new products available in the industry that may be a better fit for their clients.  It is very easy for advisors to fall behind if they are not careful!

1- Break down a big Job into manageable pieces

If you get Antsy about the small stuff you have to do around Tax time that takes time, remind yourself that small bite sized jobs take minutes to do. Tax time all in one hit can take days. Ask yourself if you'd prefer to spend fifteen minutes doing something now or fifteen days sorting the whole lot out next tax time? Getting into the habit of doing things this way may take some time to develop, but should be worth it in the end.

2- know the information you need.

Your information that you need can be a number of things: pay slips, receipts, previous tax advise or information. Basically it could be anything you will need to sort your taxes out when the time comes. You should know what you need unless this is your first year filing taxes.

3- Have a monthly Plan.

Make sure that you plan for each month. set out the things that you will need for taxes each month. You can forget about it and move on with other things in your life. Example. Make a habit of printing off bank statement every month. Make sure that you keep them in the same place each month.

4- File away and Categorize.

You can use a filing paper system as well as an electronic system that way things won't get lost you have backup if needed. Make sure that you get in the habit of filing things away as soon as you receive them. You will keep things in a system it is easier when tax time comes.

5- Use reputable financial software and tools.

Check out certain software and tools to see if they can help you get better organized.

6- Hang on to those records.

Create a financial system if need be or use an existing one that works. If you have your own business and you need to keep more in depth records, make sure you're up to date. Set aside maybe half an hour a day to organize your finances so you have all the records you need.

7- Hire an accountant or bookkeeper if necessary.

If you find yourself struggling with a lot of documents and paperwork, and you're finding it hard to keep up with things on your own, then maybe it's time to outsource some of the work to a professional who can help you.

Sometimes it is hard to know what we should have as goals in life.  Let’s face it, life is busy and the older we get the busier we are.  As we get older we realize that it is so easy to just put your head down and work.  You don’t have to think about anything just work.  The problem with that is you can lose yourself, your goals, your aspirations in life only to wake up one day and say, “what have I done with my life?  All I did was work.  I accomplished nothing.”




I can’t tell you how many people I have talked to that have said to me, “Where has the time gone.  I wish I would have accomplished this or that.”  The truth is yes, you are older.  Yes, you have lost some time.  The good news is, it is not too late to start dreaming about your goals and what you want out of life. 




Sometimes the problem is we have suppressed our dreams/desires for so long that a lot of us can’t remember what we want or how to even start to set goals. 




We have come up with a few ways to help get you dreaming again.  Hope you enjoy! 




If you know your goals:  Write your goals down!!!!!  This is a MUST for me.  I am the most forgetful person and ever since I got pregnant it is even worse!!!  There is a saying that states, “The weakest ink is stronger than the strongest mind.”  This is sooooo true!  If you don’t write down your goals then they could get lost or forgotten when the next emergency in your life happens.  Be safe, save it in INK! 




If you don’t know where to start with your goals:  Pretend life was a game.  Who would you be?  What would you do? Pretend that you had every skill, ability or resource at your fingertips.  Brainstorm what you want in life/out of life.    I am giving you permission to daydream a little.  This can take a little creativity, so be creative and don’t limit yourself in achieving your goal.  Remember that your goals/dreams don’t need to be realistic and can actually be quite comical, you are not committing yourself to any one goal.  This will hopefully get you to know yourself better and help you find what you truly want out of life.




If you know where to start with your goals, but are afraid:  Give yourself permission to THINK BIG!!!  What would your goals be if you knew success was guaranteed?  Would you be a billionaire?  A famous person? Own a TON of land?  What is the one thing that when you think about it your palms get a little bit sweaty?  Even if you think that you could never in a million years achieve anything close to your ideal goal, give yourself permission to dream and remember the saying, “Expect little and, as a result, receive little.”  If you expect more of what you want then you will get more of what you want.    Allow yourself to at least dream/know what you want. 




I hope this will help you in dreaming again.  So many people have stopped dreaming in life and are selling themselves short.  Don’t let that be you!!!  Never stop dreaming.



About this Author: De Kinsey is the co-owner/manager of LIFE 1010™.  She worked as a licensed residential and commercial escrow officer for over 5 years.  This experience helped her learn how to analyze and understand legal documents and translate them in a way the general public could understand.   De Graduated from Utah Valley University in Psychology and in Community Health Science.  She understands how a person’s psyche and personal health can have positive and/or negative impact on their LIFE and financial well being.  She brings this knowledge into the LIFE 1010™ program. 

  

This is the time of year for two things… no not football and hunting.  Nope, not those scentsy candles and warm cider.  Yep, you nailed it: Medicare and tax savings ideas.  This is the time of year when we all start looking at year-end and figuring out what we can do to avoid some taxes.  

Here are 3 quick and easy ways to save on taxes this year.

1.      Spit income.  If you are married or have a common-law spouse, you can split your income and possibly save on taxation.  The reason this works is because our tax system is progressive, meaning the more you make, the higher percentage you pay, unless, of course, you’re a Romney, then you don’t (just kidding there, No political agenda meant).  This may allow you to optimize deductions and tax credits available.

2.      Trusts.  If you have a hefty amount of assets, it is time to stop procrastinating the funding of your trusts.  The 5 plus million dollar gift tax exemption is set to expire and reset to the 1 million dollar mark at year-end.  While this may not be an immediate tax savings, it’s something that needs to be effected and funded near immediately to take advantage of the current tax breaks before they expire.

3.      Don’t forget the dependent care tax credit.  Basically, if you pay someone to care for a dependent under age 13, you may qualify for a tax credit up to $2,100.  This depends on your adjusted gross income and is a percentage of care costs of between 20% and 35%.   This credit isn’t just for child-related care costs either.  If you pay someone to look after a spouse or dependent of any age, such as a disabled family member, you may be eligible.

As always, we recommend you visit with a tax professional on any thoughts mentioned here.  We are not CPA’s or certified in any way to give tax advise and recommend you take these suggestions to your professional, or contact ours at [email protected].