When you hear the term “umbrella insurance,” your first thought might be, “What do umbrellas have to do with insurance? Is this just another product the insurance industry is trying to sell me?” Actually, umbrella insurance has nothing to do with conventional umbrellas.
Umbrella insurance is “extra insurance,” like an umbrella is extra protection against the rain, even though you have a raincoat on. Think of your regular car and homeowners insurance as the raincoat, and the umbrella insurance as the “umbrella” you carry for torrential downpours. (more…)
I recently had the pleasure of sitting down with a client’s daughter. She’s in her twenties, just finished up her nursing degree six months ago and is working the night shift at a local hospital. She is living with a couple of roommates and is finally in a position to save some money after being a very broke college student. She now faces the question posed by many young people who are starting their first “real” jobs. (more…)
Instead of giving your sweetie another trinket they will forget about within a week, why not give them the most thoughtful and caring gift you can give your spouse: A conversation about your finances. I realize this is not the most romantic gift, your spouse will thank you some day.
If you are like most married couples, you have divided up the household chores. This makes sense; it’s both efficient and keeps the peace. Unfortunately this often means that one member of the relationship takes over the banking, investment and retirement plan duties and the other pays little to no attention to that part of the household duties, as they have plenty on their plate as well. This may work out just fine for you as a couple, but what happens when one of you is not around anymore or incapacitated? As we all know, this can happen overnight with no warning, no matter what your ages.
I have worked with several clients who have lost their spouses to heart attacks, strokes and even accidents in the blink of an eye. The surviving spouse often times has no idea where all the investment and bank accounts are held, what the online passwords are or even how to log on to their home computer accounts.
They are in the midst of grieving and may have no idea how to free up cash for a funeral, where the copies of the wills are and who the current beneficiaries are on their retirement accounts.
Unfortunately this is not just limited to losing a spouse or partner. My brother and I went through this process following my father’s death. We had no idea if he had a will and if so, where it was kept. We found odd-looking keys at his home and wondered if they were for a safety deposit box or some other lock (we never did find out). It was a very challenging process both mentally and physically to grieve and try to sort out an estate with little to no information to go on. (To read more on this, please see my new eBook: The Transparent Legacy)
So this Valentine’s Day (or at least this month), be extra caring and give your loved one the gift of peace of mind and knowledge about your wishes, your finances and your passwords. But just to be sure you aren’t spending the month sleeping in the garage; you might want to also pick up those chocolates and that card.
This article was written by retired Merriman Wealth Advisor, Cheryl Curran.
I am asked this question often, which is good because if someone is not saving enough we can make adjustments and get them on the right track. The people I worry about are the ones who don’t ask this question, either of me or of themselves. Maybe they are afraid of what the answer might be or they figure their employer or the custodian of the plan is looking out for them. Well, typically they aren’t.
In 2006, the Pension Protection Act went in to place. This was a nice step towards increased retirement savings, even for the most complacent of employees. This Act allows employers to automatically enroll their employees in the company 401(k) plan. Everyone has the ability to opt out, but they have to request it. Due to human nature, we tend to follow the path of least resistance, so the results were a huge increase in 401(k) plan participation. According to a recent study done by Aon Hewitt Associates, the participation rate in company 401(k) plans is now at 85% compared with 67% for companies who do not have an automatic enrollment program.
So if you are automatically enrolled in to your company’s 401(k) plan, will you have enough money to retire? The answer is: Not likely. You will need to dig a bit deeper in to your personal situation.
The Pension Protection Act I mentioned also allows companies to set an initial default contribution amount. So a company could automatically enroll an employee in their 401(k) plan, designating for example, 3% of that person’s salary for deposit in to the 401(k) plan. This has turned out to be good and bad. The good news is that the complacent employee is participating in the 401(k) plan and automatically contributing 3% of their salary, unless they make the effort to opt out. The bad news is that 3% savings per year of your salary is not likely going to get you through retirement, unless you are expecting to really reduce your standard of living.
Let’s assume our complacent employee is named Larry. Larry makes $50,000 a year and is 35 years old. He plans to retire at age 65. If Larry adds 3% per year to his 401(k) plan (because he just can’t be bothered to opt out or add more), he will have added $45,000 over 30 years (this is before any investment gain).
If Larry made no investment selections for his 401(k) plan (which we know he probably wouldn’t, as he is Lazy Larry), then he would have automatically been invested in the money market. This would amount to about $45,000 in today’s dollars of spending money when he turns 65. Even with some Social Security, that isn’t going to last Larry long. (more…)
A majority of my clients are in retirement or they will be retired within the next 5 years or so. These relationships give me some great insight in to what retirement can be, for better or for worse. I have found over the years that my healthiest and even more importantly, happiest clients in retirement are those who are quite busy. I am often told that they do not know how they had the time to work as they feel even busier now and they are loving it!
Most of these busy individuals are doing some sort of volunteer work. You have probably heard people say that as a volunteer they get more out of it than they feel the person or organization they are helping is gaining from the relationship. And if you have given some of your time and energy to someone besides yourself, you know this to be true.
When I read this article from The New York Times, I was very happy to see that we as a nation are starting to expose young children to money matters. Using Sesame Street and the beloved Elmo is a perfect way to interest kids in the concepts of spending, saving and sharing, without talking over their heads or losing their interest.
The Sesame Street gang also spends time talking about want versus need. My brother started to teach this concept to my nephew when he was between 3 and 4 years old, and now at 5 he truly “gets it.” It doesn’t mean that he doesn’t feel he really NEEDS that new Star Wars Lego set at times, but when asked if he really does need it, he will admit he actually just wants it.
I’m as guilty as the next person of spoiling my nieces and nephew by being more than happy to buy them anything their hearts desire. But I have learned to hold back as I have seen the consequences of this behavior in many teenagers and young adults coming out of college in to their first jobs.
I hope you find The New York Times article informative and that you begin to expose kids as young as 3 to the concepts of want versus need as well as spend, share and save. You will be setting them up for success in the long run.
This article was written by retired Merriman Wealth Advisor, Cheryl Curran.
Merriman Wealth Management, LLC, an independent wealth management firm with over $3.5 billion in assets under management, is pleased to announce the promotion of two new principals – Wealth Advisors Aimee Butler, CFP®, and Chris Waclawik, AFC®, CFP®.
Merriman Wealth Management, LLC, an independent wealth management firm with over $3.6 billion in assets under management, is pleased to announce the additions of Geoffrey Curran, CPA/ABV, CFA, CFP® and Paige Lee, CFA, CFP®, CSRICTM to the firm’s investment committee.
Over the past few years, we’ve been asking our clients—to hear it in their own words—about the value they gain from working with us. Check out these top ten reasons why clients hire us.
I was recently reminded of a troubling statistic: Two-thirds of women do not trust their advisors. This is troubling, largely because it’s so preventable. Check out these tips all women should be aware of to improve this relationship and strengthen their financial futures.
One of the provisions of the CARES Act was a suspension of 2020 Required Minimum Distributions (RMDs). For individuals who took a distribution early in 2020, they were given the opportunity to “undo” part or all of that distribution by returning funds to their IRA by August 31, 2020. Learn more about the tax reporting.
I recently had the pleasure of sitting down with a client’s daughter. She’s in her twenties, just finished up her nursing degree six months ago and is working the night shift at a local hospital. She is living with a couple of roommates and is finally in a position to save some money after being a very broke college student. She now faces the question posed by many young people who are starting their first “real” jobs. 
I am asked this question often, which is good because if someone is not saving enough we can make adjustments and get them on the right track. The people I worry about are the ones who don’t ask this question, either of me or of themselves. Maybe they are afraid of what the answer might be or they figure their employer or the custodian of the plan is looking out for them. Well, typically they aren’t.
When I read 
