Money & Taxes 2012

CHRONICLEKane County

February 29, 2012

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(ARA) - When it comes to fi nancial planning, making smart investments and planning for the future aren’t your only fi duciary con-siderations. You also want to be sure you’re getting the most out of the money you spend on the process.

Estate planning is an important component of your overall fi nancial plan, regardless of your age, income or size of your estate. If you own property and have heirs, you need to think about estate planning. To do the job well, you’ll need the help of a team of professional accredited estate planners such as a certifi ed public accountant, a lawyer, insur-ance professionals and fi nancial planners, and trust offi cers.

Professional fees can add up if you don’t manage time well, so it’s important to prepare for every meet-ing with your estate planning team

members. It’s a great time to think about how you can maximize the value of the time you spend with your estate planning team.

The NAEPC offers this advice on how to have productive working relationships with your planners:

• Before meeting with a profes-sional, gather all your personal and fi nancial information, make lists of your current fi nancial advisers, assets and liabilities, collect fi nancial docu-ments such as retirement plans, life insurance policies, property deeds, partnership and business agreements and your income tax returns for the past two years.

• Write out your own personal goals, concerns and ideas. Identify people whom you would like to have inherit your property when you die, and specify what you would like to leave each. Make note of any spe-

cial needs or situations, such as a dependent child or a spouse whose disability will prevent him or her from working. Identify people you would like to name as guardian for minor children, as well as an executor for your will.

• Seek out the right profession-als. You’ll fi nd any number of people who profess to be estate planners, but NAEPC designees complete rigorous educational requirements for estate planning and adhere to a strict code of ethics. To fi nd an accredited estate planner, visit the association’s web-site, www.estateplanninganswers.org.

• Bring your notes and all the information you’ve gathered with you to your meeting. Being prepared can save you hours of billable time. Discuss your overall goals and fi nd out how each professional can help

you meet them. Ask for a list of the specifi c documents he or she will prepare for you.

• Realize that estate planning is an ongoing process. You should update your estate plan every few years or any time you experience a major life change, such as the birth of a child, marriage, divorce or death of a spouse or parent.

• Finally, once you’ve prepared for your loved ones’ fi nancial future, don’t forget to take care of their emo-tional well-being. Estate plan docu-ments are dry and technical, and they won’t communicate your emotions to those you leave behind. Consider writing a letter to your spouse and family expressing your fi nal thoughts and feelings. Keep the letter with key fi nancial paperwork and make sure your loved ones know where to locate these items.

Estate planning? Make the most of your money

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MONEY & TAXES | Kane County Chronicle / KCChronicle.com • W

ednesday, February 29, 2012 3

525 Tyler Road, Suite U • St. Charles, IL 60174Registered Representative of the securities offered through Financial Network Investment Corporation, member SIPC. Advisory services offered through Total Clarity Wealth Management, Inc. Total Clarity is not affiliated with Financial Network.

Michael Walschot‘‘Your Personal CFO’’

• Retirement Planning• Financial Planning• 401 (k) Analysis• College Savings Plans

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(630) 778-6260

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(ARA) - The new year is a time for celebration, but it’s also time for plan-ning. For many Americans, that means reviewing your budget for the next year and setting some fi nancial goals. As with any other goals, the key to achieving your fi nancial goals is laying out a process that will ultimately lead you to success.

If you’ve set yearly fi nancial goals in the past, but have failed to achieve them, now is a great time to re-evaluate your process. And don’t let past failures discourage you, because you are not alone - only 12 percent of consumers reached their fi nancial goals in 2011, according to a recent Zogby IBOPE survey commissioned by TransUnion, one of the three major credit reporting companies.

“Even though you may be busy, now is the perfect time to appraise

your current fi nancial situation and make goals for where you want to be at the end of 2012,” says Heather Battison, TransUnion’s senior director responsible for consumer education.

So what can you do to ensure fi nancial success in the coming year? TransUnion offers fi ve tips for planning and achieving your goals:

• Check your credit reports every three months. Monitoring your credit can help you recognize bad fi nancial habits, like making late payments, which can affect credit score. Regu-larly checking your credit report is also a way to protect yourself against identity theft. If you ever run into a situation where you suspect identity theft, TransUnion provides a guide for what to do next.

• Check for accuracy. Make sure the information on your credit reports

is up-to-date and refl ects your current credit history. Give yourself at least 30 days to resolve any issues. Online dispute forms are available at Tran-sUnion.com.

• Know your score. Your credit score helps determine your interest rates on credit purchases. A healthier credit score can help you receive the best interest rate, ultimately putting more money in your pocket as your work toward achieving your fi nancial goals.

• Create a monthly spending plan and stick to it. Breaking down your spending habits into smaller and more manageable increments can help you achieve your fi nancial goals. Through breaking it down by month, you can also set aside a fi xed amount each month to deal with unexpected

fi nancial emergencies that may come up later in the year. If you don’t have to spend this reserve fund, you can treat it as a year-end bonus, or, even better - put it toward next year’s goals.

• Take additional measures to minimize your exposure to identity theft. In addition to frequently check-ing your credit, you can sign up for a credit monitoring service that will alert you whenever something changes in your report.

Setting yourself up for a success-ful fi nancial year means developing plans now that you can execute as the year goes on. Additional planning tools to help you understand your credit information, manage your debt load, protect your identity and help you achieve your fi nancial goals can be found TransUnion.com.

Tips for meeting your fi nancial goals this year

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(ARA) - Charitable contributions are a great way to give back to those who need it most. Of course giving back is great for the soul, but it can also be good for the pocketbook, in the form of a tax deduction. When you begin tax preparations, keep those 2011 donations in mind.

“Many charitable givers are aware of tax deductions,” says Todd Baylis, president of Qgiv, an online fundraising platform that helps orga-nizations connect with the next gen-eration of donors. “But many of those who give are not always aware of the qualifi cations come tax season.”

Here are a few things to keep in mind to make sure your good deed doesn’t go unnoticed during tax season.

Make sure your donations qualifyFirst, make sure your donation

qualifi es. In order to receive tax savings your contribution must go to an IRS-certifi ed, 501(c)(3) qualifi ed organization. You can fi nd an updated list at many public libraries as well as the IRS website.

Another important tip, itemize, itemize, itemize. Make sure you item-ize your deductions on your tax form under Schedule A, otherwise you’ll be out of luck.Keep records

Now is the time to make sure you receive a receipt or acknowledge-ment from the organization you give to. Donations of $250 or more will not be allowed as a tax deduction unless you have the right documen-tation. To claim a deduction for cash,

check or other monetary gift, you must have written acknowledgement from the charity that includes the name of the organization and the date and amount of the contribution. For donations less than $250, if you do not have a receipt, a cancelled check or bank record will work.

You can also receive a deduction for donations such as property, cloth-ing, household furnishings or offi ce equipment, but there are specifi c rules. The process is the same when claiming your deduction. You must have a receipt for the goods from the charity, and if the item donated is worth more than $500, you will need to fi le IRS Form 8283.

“Many nonprofi t organizations now have the ability to accept online donations,” says Baylis. “When a

nonprofi t organization partners with Qgiv, those donating to that organization will receive customized receipts by email in addition to the having the ability to print a receipt for their tax records.”

With the increase use of smart-phones, mobile giving has become more and more popular. If you do-nated using your phone, you can use your phone bill as a receipt as long as it lists the date, amount donated and the name of the charity.When in doubt, ask

When preparing for tax season there are many resources to help you make sure you are getting your correct deduction for charitable giv-ing. If you have a question, ask a tax adviser or go visit the IRS website for specifi cs on charitable giving.

Charitable giving: Important tips for tax season

Jobs may change. Retirement dreams don’t have to.If you’ve left a job and have a 401 (k) or other retirement accounts, don’t forget about them. Rollingover assests you have with former employers or other institutions to an Ameriprise IRA can beimportant in making your retirement dreams a reality.

Understanding and managing your retirement income strategies can help you put a confidentretirement within reach.To start a conversation, call me at (630) 762.6556.

Steve SmithFinancial AdvisorAssociate Vice President555 S. Randall Rd., Suite 100St. Charles, IL 60174

MOREWITHIN REACHSMAmeriprise Financial cannot guarantee future financial results. Brokerage, investment and financial advisory services are made available through AmeripriseFinancial Services, Inc. Member FINRA and SIPC. Some products and services may not be available in all jurisdictions or to all clients.© 2010 Ameriprise Financial, Inc.All rights reserved.

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(630) 762.6556Toll Free: 1 (800) 942.5959Steven.L.Smith@ampf.com

MONEY & TAXES | Kane County Chronicle / KCChronicle.com • W

ednesday, February 29, 2012 5

Are you prepared?Are you prepared?

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emotional and financial burdens Long Term Care places on

family & friends. What is your written plan if you lost your

independence and your family needed to take care of you in

your home or in extended care? Ideally you should plan well

before retirement. Free consultation via phone or in person.

Sharon Surrett, MBA, CSA, CLTCSpecialist in Long Term Care Planning

630-208-6882ssurrettLTC@gmail.com

www.sharonLTC.com

(ARA) - One of the many benefi ts of marriage is having a partner to share in the day-to-day tasks. One person might handle the laundry while the other takes over yard work. But, when it comes to money management, while you may end up delegating most of the responsibility to one person, it’s in every couple’s best interest to be mutually involved in the family fi nances.

Life is full of uncertainty and change, and it’s possible, even likely, that you will be responsible for your own fi nances at some point. For many, the fi nancial im-pact of signifi cant life changes, from the good, like marriage and children, to the not-so-good, like death and divorce, is of-ten a costly afterthought. While divorce and death are diffi cult possibilities to ac-cept or anticipate, they are changes that come with many fi nancial implications. This holds especially true for women who typically outlive their male counterparts.

According to the National Association of State Treasurers Foundation, 90 per-cent of women will be solely responsible for their fi nances at some point in their lives.

However, despite the likelihood of eventually living this new fi nancial real-ity, less than half of women (45 percent) and men (41 percent) have a contingency plan in place should something happen, according to research by TD Ameritrade, Inc.

“It’s not always the easiest conversa-tion to discuss with your partner because it forces you to think about worst-case scenarios,” says Lee McAdoo, director of Women’s Initiatives at TD Ameritrade. “But you’ll fi nd that discussing your fam-ily fi nances and setting goals together can also give you peace of mind.”

Life transitions are often times unex-pected and highly emotional, which can make decision making more diffi cult. For

those reasons, it’s best to plan ahead.Here are 10 suggestions to help you

make sure you can effectively handle your personal and family fi nances:

1. Create a detailed household budget.

2. Compile all your fi nancial documents, make copies and store them with your attorney or place them in a safe de-posit box that you both can access.

3. Conduct an inventory of marital as-sets.

4. Determine medical expenses and other annual costs for your family such as activities fees for your children and gym memberships.

5. Review all your debt, including mort-gages, student loans, car loans and credit cards. Obtain a current version of your credit report at least once a year.

6. Make sure each person is aware of how you fi le your tax returns and your tax fi ling status.

7. Discuss long-term savings plans and goals, including retirement and col-lege savings plans.

8. Review benefi ciary designations in your will and update if necessary.

9. Consider employee benefi ts for each person.

10. It can be helpful to have an attorney or fi nancial adviser review fi nancial doc-uments and give you advice should you desire it.

While involving yourself more in your fi nances means taking on extra responsi-bility, it can also help you feel empowered and set your mind at ease as you look to the future.

Ten tips to manage your money through unexpected life changes

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(ARA) - The federal government and the average consumer have a lot more in common than you might think. The gov-ernment’s debt has grown exponentially since the 1980s, and this summer we saw it come dangerously close to the debt ceiling - the cap set by Congress on the amount of debt the federal government can legally borrow. Some people often ignore their limits to get what they want in the moment and push the bounds of their own “debt ceiling.” Doing so could damage your credit score, dig you deep in debt that will be diffi cult to pay off, and ultimately hinder your long term fi nancial goals.

The federal government has raised the debt ceiling nearly 100 times since the ceiling was established, but you don’t have to. Taking on too much debt can have severe consequences - today, more than 5.6 million mortgages are either delinquent or in foreclosure, and a

lack of savings can impact one’s ability to retire comfortably. Here’s some ways to set your limits and stick to them.

Get lean and mean: Take a hard look at how you’re spending your money. Save receipts for any purchase you make for a week (or a month). At the end of your prescribed time period, go through your receipts and see where your money’s going. Divide your receipts by category - such as household expenses, meals, entertainment - and tally them up for each group. Sites such as Mint.com, or smartphone apps like iReconcile, can help you track and analyze your spend-ing if saving receipts is a hassle for you. Understanding where your money is going is a necessary step to determine your own budget and where you need to cut down, and can help you understand where you’re headed fi nancially.

Hidden expenses: You’ve tracked your spending. Now take a look at hidden

expenses - little regular expenditures that don’t seem like much on their own, but over time can drain your fi nances. Have a Netfl ix or Hulu Plus account you’re too busy to use? Cancel your sub-scription and save $7.99 a month - which adds up to nearly $100 a year. Cancel unnecessary unused gym memberships, cellphone insurance, unused long dis-tance plans and extra TV channels and watch your bank account rebound.

Take that savings one step further and open a separate account for those “found” funds. Look for a bank that makes it easy for you to save, with ac-count offerings that meet your needs.

Find more hidden money by empty-ing the change from your wallet into a jar at the end of each week or month. Some banks offer their customers free coin counting services. Deposit the counted coins into your savings for a pain-free nest egg!

Hidden fees: Just like you may not notice all the little hidden expenses that can drain your bank account, watch out for hidden bank and credit union fees - charges for paper statements, trans-actions with tellers or over the phone, the purchase of gift cards, or monthly checking. According to Bankrate.com, six out of 10 banks increased their checking fees recently.

Review your statement carefully each month to ensure you’re not being charged for things you’re not aware of - and if you fi nd you are, have a chat with your bank to see if they offer other products that meet your needs. You should have access to services, conve-nient hours, and a large branch network without being nickel and dimed.

With these tips and a little bit of leg-work, you’ll be on your way to keeping your personal debt ceiling in check.

Managingyour own personal debt ceiling

MONEY & TAXES | Kane County Chronicle / KCChronicle.com • W

ednesday, February 29, 2012 7

440 S. Third St, Suite 202St. Charles, IL 60174630-762-8600

www.whattax.com

Investment and insurance products distributed by Genworth Financial Securities Corp., member FINRA/SIPC and a licensed insurance agency (dba Genworth Financial Securities and Insurance Services in CA); investment advisory services are offered through Genworth Financial Advisers Corp., an SEC Registered InvestmentAdviser. Home offices at 200 N. Martingale Rd., Schaumburg, IL 60173; phone 888 528.2987. Morrison & Associates Wealth Management is not affiliated with Genworth Financial Securities Corp. or Genworth Financial Advisers Corp. Accounting and tax services are offered solely through Morrison & Associates WealthManagement which is not affiliated with Genworth Financial Securities Corp. or Genworth Financial Advisers Corp. This is not a solicitation for sale of securities in any jurisdiction. The registered representative(s) or investment adviser representative(s) referred to on this site may only transact business, effect transactions insecurities, or render personalized investment advice for compensation, in compliance with state registration requirements, or an applicable exemption or exclusion. Following are the states in which William O. Morrison, Jr. is securities-registered: CA, CO, CT, FL, GA, IA, IL, KY, MD, MN, PA, TX, UT, WA, WI.

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(ARA) - Tax time is a stressful time, even for the most prepared fi ler. And for the many people who aren’t perfectly prepared when the season rolls around, each commercial, ad or sign that mentions tax preparation can be a painful reminder that the daunting task still lies ahead.

This year, don’t let yourself be affected by the stress - or at least fi nd ways to cut back on it. By avoiding these six common mistakes, you’ll be making the process of fi ling your taxes a lot easier on yourself. Mistake 1: Rushing to fi le by April 15

If you aren’t ready by the 15th, you don’t need to panic. Six month exten-sions are now an easy-to-use option. You no longer have to give a reason about why your taxes aren’t ready by the initial deadline - just fi ll out and fi le Form 4868, and you’ll give yourself some extra time to get it all complete. Mistake 2: Being a perfectionist

Of course, you can’t and don’t want to lie on your tax return, but you

don’t have to panic about making sure that each minute fi gure is perfect. The IRS isn’t going to hunt you down and send you to jail over a simple mistake - even they understand that we’re all human. If you’ve lost some information that’s necessary to your tax return, do your best to fi ll it out using reasonable estimates. Don’t let perfectionism get in the way of fi ling. Mistake 3: Going it alone

We aren’t all tax experts, and that becomes particularly clear when you start fi lling out the labyrinthine forms. And if you’ve had any major (or even minor) changes to your life this year, the whole process can get even more confusing. Getting help from a tax pro-fessional is much more affordable than you might imagine, and can pay off in a lot of ways, not least of which could be a lower overall tax bill. Mistake 4: Not reviewing your work

You had to do it for your home-work, but you should be doing it for your taxes, too. Going back to your

taxes with fresh eyes can help you catch mistakes or areas that were simply missed. Check the details. Are your Social Security numbers right? Were any credits or deductions missed? Mistake 5: Being afraid to ask questions

The old axiom “there are no dumb questions” applies to your taxes. If you’re not an expert, there will almost certainly be something that you don’t understand or fi nd confusing. Luckily, there are plenty of resources out there that can answer your ques-tions. You can go directly to the IRS website or the IRS help line, but if you still need more assistance, ask your question at Equifax’s blog or check with a tax professional.Mistake 6: Not being careful with direct deposit

The advent of direct deposit has been a benefi t to those waiting for

their tax re-

funds, but you have to do the footwork for the IRS. They can only deposit the funds into the account you tell them to use, so make sure that the informa-tion you provide is correct. If there’s a mistake and your money is deposited into the wrong account, it’s a night-mare, at best, to get it back. At worst, you might not get it back at all.

Preparing taxes might never be your favorite activity, but it doesn’t need to be a painful experience. Get the help you need, be cautious and don’t let the stress get to you - tax season will be done before you know it.

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Have you made these six tax mistakes? How to avoid them this year

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