Retiring Soon? Do You Have all Your Questions Answered?

Written by Kevin Jacobs on November 4, 2011 in broken arrow, Certified Financial Planner, CFP, fee based, fee only, Fee Only Financial Planner, Financial Planning, Investing, Retirement Planning, Tax Planning, Tulsa - No Comments

If you are looking at retiring soon, do you have the answers to the questions to adequately prepare for this time in your life?  I have listed below and also included in the video typical questions I help clients answer.  If you have these questions, you may want to consider seeking out a financial planning professional.

  • Will I outlive my retirement savings?
  • What will I spend my time in retirement doing?
  • Will social security be available to me?
  • Should my annuity really be inside of an IRA account?
  • How much money do I really need to retire?
  • I want to retire early.  How much should I be saving now?
  • I am a teacher.  What pension payout option should I select?
  • What will be my cost of living in retirement?

What Should You Expect from Step By Step Tax and Financial Planning

Written by Kevin Jacobs on November 3, 2011 in Certified Financial Planner, Enrolled Agent, fee based, fee only, Fee Only Financial Planner, financial advisor, financial planner, Investing, Retirement Planning, Tax Planning - No Comments

SBS_What_to_Expect (Click here to listen to short audio version of this blog.)

What should you expect if you engage Step By Step Tax and Financial Planning for holistic tax and financial planning services?

1.  Straight Talk

2.  Easy Access

3.  Value for Your Money

4.  All-Inclusive Approach

5.  Adaptive & Ongoing Service


Looking for a Planner? Want to know who we serve best?

Written by Kevin Jacobs on November 2, 2011 in broken arrow, Enrolled Agent, fee based, fee only, financial planner, Investing, Oklahoma, Retirement Planning, Tax Planning - No Comments

I often get asked who would be a good fit for the services we offer here at Step By Step Tax and Financial Planning.  Well just watch this short 2-minute video and you will find out.

Five Factors that Influence Your Investment Decisions

Written by Kevin Jacobs on August 10, 2011 in broken arrow, Certified Financial Planner, CFP, Enrolled Agent, fee based, fee only, Fee Only Financial Planner, financial adviser, financial advisor, Financial Education, financial planner, Investing, Oklahoma, Retirement Planning, Tax Planning, Tulsa - 1 Comment

When you are making an investment decision, it is important to remember these five factors and the how they effect your decision-making process.  These variables include:

1.  Time Horizon

2.  Risk Capacity

3.  Expected Return

4.  Asset Class Preference

5.  Tax Status

Emotional Decision Making Often Leads to Poor Outcomes

Written by Kevin Jacobs on August 8, 2011 in Economics, Investing - No Comments

Below is a blog entry I wrote on May 6th, 2010. If you do not remember, this was the day of the infamous “flash crash.” As I was thinking about what to send out this evening in preparation for what could be a very volatile (prices go up and prices go down) period in the market, I found this article said it all. I encourage you to not panic and to make decisions based off of emotions. If you have a long-term plan in place, there is the high likelihood you do not need to do anything different than what you are doing now. If you do not have a long-term in place, you may want to consult with a professional to help put a thought-out and objective plan together. As you read the article below, please remember how you reach financial security. You do not reach it overnight but rather by taking “one step at a time!”

By: Kevin F Jacobs
Written: May 6th, 2010

Today was an unprecedented day in the stock market. At one point the Dow Jones was down nearly 1,000 points (I can’t believe I am even writing that number).

I want to stress that the best thing to do is to remain focused on the things you can control, i.e. your savings rate, your asset allocation, your debt-to-income ratio, etc. You can not do anything about what the market does day to day, but you can do something about those things mentioned above. You are going to hear many “talking” heads on the radio and TV give various explanations for why things happened the way they did. However, the real question is how these events are going to affect you and the ones you love. We have a tendency to get lost in the stress of everyday life and we forget to make note of the blessings we have each day.

I am not telling you to be oblivious to what is going on in the world but that you need to work on the things you can do something about and let everything else take care of itself. It is important you do not overreact to short-term market events. During times like these it is important to remember the basics regarding your financial life:

1.Live on less then you make
2.Have $0 consumer debt
3.Don’t buy more house then you can afford
4.Pay as little in taxes as you are allowed
5.Have proper cash and emergency reserves
6.Save for the short-term and invest for the long-term
7.Spend time with your family and those you love instead of watching the latest stock market charts.
As for the rest of it, take a deep breath and remember to control the things you can and let go of those things that are outside of your power.

Services Offered By Step By Step Tax and Financial Planning

Written by Kevin Jacobs on February 8, 2011 in Uncategorized - No Comments

I often get asked to give a brief summary of the services I offer here at SBS.  With that in mind, I have written the following blog post.  Enjoy and please comment!

At this time, we have three predominant services we offer to individuals and businesses:

1.  Fee-Only Financial Planning Retainer Service for Pre-Retired Married Couples and Entrepreneurs

Step By Step Tax and Financial Planning is a fee-only financial planning firm in the metro-Tulsa, OK area. What makes us different from many financial firms is that we offer professional, objective tax and financial planning services on a one-to-one personal level. We are an independent firm whose complete focus is on the client.

We work with a small number of individuals in order to best serve each one, remaining focused on the needs of our clients. The only compensation we receive is directly from our clients. We do not receive commissions, referral fees or third-part incentives. 

2.  Individual and Business Tax Planning and Preparation

Along with the holistic financial planning services we offer to our clients, Step By Step Tax and Financial Planning, LLC also services the tax preparation needs of many individuals and businesses. Kevin Jacobs, CFP®, EA is enrolled to practice before the IRS.

The fees for tax preparation are very straightforward. We serve the needs of our tax preparation clients on an hourly basis. For individual clients, the hourly rate is $75/ hour for the first four hours and $37.50 for each additional hour after the initial four. For business returns, the hourly rate is $75/ hour. There is a minimum fee of $75 for all returns.  If you are looking for a second opinion on your individual or business return, we also offer that service at our standard business tax preparation rate.  There are no additional charges for e-filing or document preparation.

3.  401k Retirement Plan for Small (as few as one participant) to Medium-Sized Companies

If you are looking to start a 401k plan for your company or if you are not happy with your current provider, please contact me so we can discuss the benefits of a multiple employer plan.  Most small businesses do not know the liability they take on in offering a plan to their employees.  On top of that, the fees charged by most providers are astronomical for the small to medium-sized businesses.  You have nothing to lose by setting up an initial consultation for us to discuss your company’s retirement plan.

R U Ready for 2011? “Retool” Presentation Notes from BA Lead$ Summit

Written by Kevin Jacobs on January 27, 2011 in broken arrow, Enrolled Agent, Tax Planning - No Comments

Below are my notes and questions I used for the Lead$ Summit today at the Broken Arrow Chamber of Commerce.  Use these notes to help you “retool” for the New Year!  Feel free to leave comments below.

Retool

 Presented by:  Kevin Jacobs, CFP®, EA

Owner of Step By Step Tax and Financial Planning, LLC

 Definition of Character

  • “The ability to meet the demands of reality.”
    • Dr. Henry Cloud, Integrity, pg. 24

Aspects of Character

  • “The ability to connect authentically (which leads to trust).”
  • “The ability to be oriented toward the truth (which leads to finding and operating in reality).”
  • The ability to work in a way that gets results and finishes well (which leads to reaching goals, profits or the mission).”
  • The ability to embrace, engage, and deal with the negative (which leads to ending problems, resolving them or transforming them).”
  • The ability to be oriented toward growth (which leads to increase).”
  • The ability to be transcendent (which leads to enlargement of the bigger picture and oneself).”
    • Dr. Henry Cloud, Integrity, pg. 35

http://www.drcloud.com/index-5.html

 With knowing the definition of character, now we can progress at evaluating our life and retooling for the future.

General

  • Are there things you want to do that you haven’t done yet?
  • What is not working in your life?
  • Is your life in balance? 
  • Do you have enough leisure time, vacations, travel, hobbies, and fun in your life?
  • What is your “top ten” list and what are you doing do achieve them?
  • What are 10 things you most love doing?
  • Are there any big adventures you want to have?

 Physical

  • How’s your health?  Are there changes you want to make?
  • Do you want to reduce stress or increase your level of fitness?

 Educational

  • Are there areas of personal growth that you would like to pursue?
  • Is there a degree or professional designation you want to receive?  What steps are you taking to achieve it?

 Social

  • Are you as involved as you would like in your community?
  • Are your friendships what you would like them to be, in terms of both quality and quantity?

 Vocational / Business

  • Are you happy in your current career or profession?
  • Is it rewarding for you?
  • Do you want to increase your income?
  • Is your business profitable?
  • Do you want to start a business?
  • Are there planning or marketing ideas you would like to pursue for your business?
  • Are you working a reasonable number of hours?
  • Have you set your 2011 business activity and income goals?

 Financial

  • What priority does money take in your life? 
  • What are you building wealth for?
  • How much do you need?
  • Are there changes you would like to make in your income, expenses, cash flow, debt, savings, reserves, emergency funds, investing, taxes, or net worth, for example?
  • Are you making the progress toward your retirement / financial independence that you would like?
  • Are there any impending financial decisions that you need to plan for?
  • Is college education funding for your children / grandchildren satisfactory?
  • Are there any changes or improvements you need to make to your home?
  • Is your estate planning up to date?  Are you on track to leave the end-of-life gifts you want to make?
  • Have you reviewed your insurances recently?

 Family

  • Are there family goals you have – trips, more time together, for instance?
  • How is your relationship with your spouse?
  • How are your relationships with your children?
  • How are your relationships with other family members – siblings, parents, confidants?
  • Are your family members taken care of for the future?
  • Do the important people in your life know how much you love and care for them? 

 Philanthropy/ Charitable Giving

  • Do you want to volunteer more – or differently?
  • Are your charitable contributions at the level you would like?
  • Are you satisfied with the legacy you plan on leaving?

 Spiritual

  • Are there things you want to simplify or consolidate in your life?
  • How is your spiritual / religious life?  What can you do to improve it?
  • Are there any spiritual growth activities you want to participate in?

Important Information Regarding Roth IRA Conversions

Written by Kevin Jacobs on October 26, 2010 in Financial Planning, Investing, Tax Planning, Uncategorized - No Comments

Below you will find a blog entry from Bert Whitehead, a mentor of mine, with the Alliance of Cambridge Advisors.  This is important information to read and to do something about sooner then later.   I use this information with permission from the author.

Roths Now Make the Tax Code Your Friend!

Bert Whitehead, M.B.A., J.D.©

Starting in 2010, the Tax Code opens up vast opportunities to increase Roth IRA participation for many taxpayers. As I will explain, you will need to consider at least 11 issues or possible strategies to make the most of this and determine the final formula that will reduce your long-term income tax bill and address other financial goals. But I caution you from the outset…Roth conversions are a hot topic with brokers and investment advisors who want to use this as an asset gathering gimmick or earn commissions from transactions. It is a complicated opportunity, and demonstrates how a comprehensive Financial Advisor who handles your taxes, investments, and estate planning is able to add value.

Here’s a review of some Roth IRA basics.

You probably know that if you work and your overall income is low enough, you can contribute to a Roth IRA as one of your annual IRA contribution choices. Your contribution is taxable (that is, you cannot deduct it on your tax return) when it is made. Age 70 ½ distributions are not required and, if taken, withdrawals in later years are totally free from income tax. Depending on your circumstances, this can be a huge advantage. A Roth IRA contribution of $5,000 can grow to $80,000 if invested at 7% over your working career, and you would save taxes on $75,000!

The only way to fund a Roth IRA other than an annual contribution based on earned income is to “convert” an existing IRA (or similar pre-tax retirement account) to a Roth IRA and pay tax on the current IRA distribution now rather than at age 70 ½. . In the past, your total adjusted gross income (AGI) had to be under $100,000 to avail yourself of this option. This is the big change this year.

Starting in 2010, you can convert any of your IRA’s to a Roth IRA no matter how high your income. While you do have to pay the income taxes now, remember that future withdrawals from your Roth IRA are tax-free! The reason why 2010 is a big year is two-fold; 1) there is special relief when paying the income taxes that result from any 2010 Roth conversion and 2) we are all facing the threat of rising income tax rates.

Here are some points to ponder and strategies to consider. Again, these can be complicated so you should expect to discuss whether these apply to you during the year when you do tax planning with your ACA advisor (i.e. a member of the Alliance of Cambridge Advisors).

Read more…

Why It Matters How Your Advisor Gets Paid?

Written by Kevin Jacobs on October 19, 2010 in fee based, fee only, financial adviser, financial advisor, Financial Education, Financial Planning - No Comments

I get asked a lot of times what is a “fee-only” advisor and why should I work with one?  Let me answer these frequent questions.  First, a fee-only financial advisor’s compensation comes directly from the client.  The advisor does not receive any commissions or referral fees from selling financial products, such as annuities, insurance and investments.  A fee-only advisor may receive compensation from assets under management, retainer fees or an hourly rate.  I focus the majority of my business on retainer fees, however, I do some minimal pay per hour projects. 

For information sake, a “fee-based” advisor receives compensation from both charging a fee for completing a financial plan and also selling you financial products that come about as a result of the planning recommendations in the plan.  I call these folks “double dippers.”  Many times the financial plan is offered at severe discount.  Their real profit comes from selling you the products they recommend.  They beleive if they charge you a fee for their advice you are more likely to implement their advice.  Some “fee-based” planners criticize “fee-only” advisors because they say “fee-only” advisors offer planning without implementation. 

A commission-only advisor makes his compensation strictly from selling you financial products that have a load or commission attached to them.  In my humble opinion, I tend to trust “commission-only” folks more than “fee-based” advisors because you know they are only getting paid from what you buy from them and they do not have any ulterior motive in offering you a “plan”. 

I personally believe that each of these advisors have a place in the financial world, however, the main thing I ask from each one of them is to disclose to the client how they are going to get paid and allow the client to make the decision. 

The #1 reason why you should work with a fee-only advisor is they can give you “objective, unbiased” financial advice free of the potential conflict of product sales.  Yes, a fee-only advisor is still selling a product to you. The product he is selling is an education and trustworthy advice.

When it comes to you and your money follow this common rule:

“Know how your advisor gets paid and you will likely find out the quality of his advice!”

Dateline NBC Exposing the Sale of Equity Indexed Annuities

Written by Kevin Jacobs on August 7, 2010 in Annuities, broken arrow, fee only, financial adviser, financial advisor, Financial Education, financial planner, Financial Planning, Investing, Tulsa, Uncategorized - No Comments

 

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