Posts filed under 'Tax Issues'

Taxpayers worried about pocketbooks as fiscal cliff talks fail

By STEPHANIE BEECKEN

6 News Reporter

Interview of J. David Lewis for the 6 PM Top News Story on December 31, 2012.

KNOXVILLE WATE – As House Republicans announced Monday evening that they will

not vote on a bill to avoid going over the fiscal cliff, residents in Knoxville are worried it could hurt their pocketbooks.

The lack of a deal means automatic tax increases and spending cuts will go into effect Jan. 1.

As talks continue between members of Congress and the President to reach a deal to retroactively block the tax hikes and spending cuts, small business owners and many in the Knoxville community are wondering what will happen with their tax rate in the new year.

One Knoxville financial planner says the increased taxes could devastate working class Americans and cause the country to enter another recession.

Single mother of two Ashley Reed is on a fixed income. She budgets every dollar and the uncertain tax rate for the new year has her concerned. “I feel bad about it. Its awful. I dont want our taxes to go up,” said Reed.

David Lewis, a financial planner and small business owner, is also anxious about whether Congress and President Obama can strike a deal.

“Im kind of frustrated at the whole thing, a little ticked off that its such a big deal when it could have been settled so much easier,” said Lewis.

Lewis owns Resource Advisory Services, a financial planning business he founded 27 years ago.

See the video or read the rest via Taxpayers worried about pocketbooks as fiscal cliff talks fail.

1 comment January 1st, 2013

If Taxes Are Done, Consider a Financial Tuneup – NYTimes.com

Our Comment by J. David Lewis – This article got my attention because its title reminds me of a fundamental activity at the heart of our financial planning methodology.  The stuff for a tax return is a good place to start.  There is a link to a great tune-up check list within its body for do-it-yourself people (see below). 

Our additional thought is that regularly measuring progress with a net worth statement is also important.  Knowing about progress, instead of guessing, helps avoid those nagging feelings of insecurity.  Even if you are far from your goals, you can feel better.  Few things can devastate feelings of security more than discovering you have misled yourself into believing you are doing better than you actually are.  So, tax time is also a good time for people who do financial planning themselves to compare this year’s net worth with previous years.  We do this every three months for our clients.

If the Taxes Are Done, You Might Consider a Financial Tuneup By RON LIEBER Published: March 25, 2011

“That completed 1040 form and its various appendages, as well as the pile of paper that helped you fill them out, offer a window into your financial life. Aside from earnings, there’s often a fair bit about debt and savings and what you gave away.

So what better time than now to read it all over again to see what it adds up to?”

 The article via If Taxes Are Done, Consider a Financial Tuneup – NYTimes.com.  “There are 31 ideas on the interactive checklist we built last year; it’s linked from the online version of this column.”

Contact J. David Lewis directly with david.lewis@resourceadv.com or share your thoughts on this topic below. He founded Resource Advisory Services in 1985.  National Association of Personal Financial Advisors (NAPFA) was formed only a few years before. Lewis became a NAPFA-Registered Financial Advisor in 1986.  He is a passionate advocate for fiduciary, fee-only financial planning and has been associated with financial services since childhood in a banking family. 52461

1 comment March 29th, 2011

10 Reasons To Buy a Home – WSJ.com

Our Comment by J. David Lewis – This article reminds me of a single comment in an economics or finance course before 1980 – maybe before 1970.  It was to the effect “The more often the publication is issued and the greater the fanfare, the less likely the story is to have relevance as a predictor.”  The article has Time magazine cover-images from 2005 and 2010, with primary stories on housing.  The 2005 version seems to promote homes as a way to build wealth, very close to the exact wrong time. The second seems to say homes are the wrong place to put your money now.  The text of this WSJ.com article gives ten reasons you may want to go against the cover story on a recent Time magazine.

“Enough with the doom and gloom about homeownership. 
 
Sure, maybe theres more pain to come in the housing market. But when Time magazine starts running covers that declare “Owning a home may no longer make economic sense,” its time to say: Enough is enough. This is what “capitulation” looks like. Everyone has given up. The Sept. 6 cover of Time magazine: This is what capitulation looks like.
 
After all, at the peak of the bubble five years ago, Time had a different take. “Home Sweet Home,” declared its cover then, as it celebrated the boom and asked: “Will your house make your rich?
   
But its not enough just to be contrarian. So here are 10 reasons why its good to buy a home.” 
  
  
Contact J. David Lewis  using david.lewis@resourceadv.com. He  founded Resource Advisory Services in 1985.  National Association of Personal Financial Advisors (NAPFA) was formed only a few years before. Lewis became a NAPFA-Registered Financial Advisor in 1986.  He is a passionate advocate for fiduciary, fee-only financial planning and has been associated with financial services since childhood in a banking family.

Add comment September 16th, 2010

How to pick a team of financial pros | NJ.com

Our Comment by J. David Lewis -  This article begins a very good discussion of things to consider with insurance agents, accountants and investment advisors.  It is definitely worth reading, including the idea that you should consider a few candidates.  The next in the series will go further .  

How to pick a team of financial pros
Published: Thursday, August 26, 2010, 1:10 AM 
 Karin Price Mueller/The Star-Ledger

“Even if you’re a do-it-yourselfer, there are times you should call in a pro. These pros have experience in areas you may dabble in. And when it comes to your financial life, dabbling doesn’t cut it. That’s where the pros come in.  We all need an objective observer who can see the overall picture and come up with a game plan.  Forgive the sports analogies, but think of it as a football team. You may be a killer quarterback, but without a reliable receiver and solid linemen, you’ll be mincemeat on the field.  This is the first installment of a two-part guide to choosing your team of pros.”

The full article is available via How to pick a team of financial pros | NJ.com.

J. David Lewis founded Resource Advisory Services in 1985.  National Association of Personal Financial Advisors (NAPFA) was formed only a few years before. Lewis became a NAPFA-Registered Financial Advisor in 1986.  He is a passionate advocate for fiduciary, fee-only financial planning and has been associated with financial services since childhood in a banking family.  Contact him using david.lewis@resourceadv.com.

Add comment August 26th, 2010

Yankees Owners George Steinbrenner Saved $600 Million in Estate Taxes by Dying in 2010 – Metropolis – WSJ

Our Comment by J. David Lewis – This revelation really frustrates me.  Our legislators have had nearly ten years to develop a reasonable estate tax law.  Numerous attempts have been negotiated and debated.  Every year, I have expected the issues to be resolved.  One night, I went to bed thinking a bill would be passed in my sleep; to learn when I woke that the expected agreement was not reached.  No wonder so many are so disillusioned with these guys.  

 By WSJ Staff

“Because Steinbrenner died in a year when there is no federal estate tax, he potentially saved his heirs a 55% estate tax on his assets — or a tax bill of about $600 million. The 55% tax takes effect on January 1, 2011. If Steinbrenner had died in 2009 when the estate tax rate was 45%, his estate tax bill might have been nearer $500 million. Because the wealthy often do elaborate planning, putting assets into trusts taxed separately from the estate or into foundations that are tax-exempt, it is unclear how large his estate will be. Estate taxes may also be postponed on assets left to a spouse in years when there is an estate tax.”

Read this version of the story via Yankees Owners George Steinbrenner Saved $600 Million in Estate Taxes by Dying in 2010 – Metropolis – WSJ.

J. David Lewis founded Resource Advisory Services in 1985.  National Association of Personal Financial Advisors (NAPFA) was formed only a few years before. Lewis became a NAPFA-Registered Financial Advisor in 1986.  He is a passionate advocate for fiduciary, fee-only financial planning and has been associated with financial services since childhood in a banking family.  Contact him using david.lewis@resourceadv.com.

Add comment July 15th, 2010

Dow Jones – Avoiding Bad Advice Reaps Retirement Rewards

 Our Comment by J. David Lewis:  This article illustrates how people who mean well, but do not have real world experience in helping clients navigate through the many issues of their overall financial picture, can be seriously misguided.  There is more to money than money.®  It takes a comprehensive understanding of the relevant issues to provide good advice.  One should not give advice on one aspect of a financial situation without understanding how that aspect affects the whole picture.

 By TAYLOR SMITH

A big conference table in a room with a view of Boston Harbor. A cadre of law-firm trustees in three-piece suits offering a widow in her mid-50s advice on what to do with the assets of her recently deceased husband, a senior partner at the firm.

This was the scene in which Jane King and her client found themselves 15 years ago. And King couldnt believe the advice coming from these powerful lawyers.

“To tell you the truth, I was probably a little intimidated,” she says. “I said to myself, “Am I not catching on to what theyre advising?”

King, president of Fairfield Financial Advisors in Wellesley, Mass., actually understood what they were saying perfectly well. To her amazement, they were counseling the widow to withdraw the nearly $1.5 million her late husband held in the firms retirement plan and stash the entire pile of money in municipal bonds.

Read the rest of this artical via Dow Jones – Avoiding Bad Advice Reaps Retirement Rewards.

J. David Lewis founded Resource Advisory Services in 1985.  National Association of Personal Financial Advisors (NAPFA) was formed only a few years before. Lewis became a NAPFA-Registered Financial Advisor in 1986.  He is a passionate advocate for fiduciary, fee-only financial planning and has been associated with financial services since childhood in a banking family.  Contact him using david.lewis@resourceadv.com.

Add comment July 2nd, 2010

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