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Category: Domestic partners

Long Term Care for LGBT Couples

Yuk. No one wants to think about nursing homes, or assisted living, or anything in old age that has the yuk factor. I know that I don’t want to think about it…. But I do..

63% of people over the age of 65 will be in a nursing home, assisted living facility or need in home health care (www.caregiver.org). That’s nearly 2/3 of the population! You insure your car and your home, why not insure yourself. Great news – most LTC plans include partners for spousal discounts if they apply together, even if they aren’t married. This can be a great cost savings for same sex couples.

Not only does LTC help take care of you when you can’t do so anymore, it takes care of your surviving partner. How? The typical assisted living facility runs about $5000/month. That’s $60,000 a year. Four years is $240,000. If that’s spent on your LTC costs, will your surviving spouse have enough left for them self to live on? Protect your nest egg and your life savings. Get the insurance. You didn’t work hard your entire life to leave it to the nursing home.

Sharon L. Herman AAMS, ADPA is the CEO of Silver Key Wealth Management, and affiliated with LPL Financial. www.silverkeywealth.com
The opinions expressed in this material do not necessarily reflect the views of LPL Financial.
Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Independent Financial Partners, a registered investment advisor and separate entity from LPL financial.
Ms. Herman may only discuss and/or conduct transact securities business with residents of FL, MI, GA, VA, NJ, TX. www.finra.org. www.sipc.org

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Record Keeping 101

Hello savvy investors!

One of the best ways to stay on track with your financial life is to get organized. Here’s a great tip. You should split up your files between short term and long term records. Below is a list of what records fall in which category.

A great way to start off the new year is to go through your current records, purge what you don’t need and reorganize what is left. Then just maintain what you have! It will make your life much simpler down the road. Happy organizing!

Short Term records – keep for one year

• paid bills
• bank/investment statements
• canceled checks
• credit card statements
• health records
• resume (review and update yearly)
• income tax receipts (then put with your tax return in your long term records)
• major purchase receipts
• insurance policies (auto/house/boat)
After a year, clean out your files. Most major financial institutions have online access to statements. You may not even need a paper file for some of these documents.

Long Term Files
Long Term Files should include:

• bank statements (last 7 years)
• credit card statements (with home improvement expenses)
• receipts for home improvements
• warranties
• income tax records
• inheritance papers
• investment statements for all investments – stocks, bonds, mutual funds, retirements plans, annuities
• legal papers about formerly owned properties
• birth certificates
• social security cards
• burial deeds
• wills/trusts
• powers of attorney
• car titles
• house titles

Remember not to keep any wills, trusts, power of attorney paperwork in a safe deposit box. When a death occurs banks will seal the safe deposit box and people will not be able to access your paperwork. Keep documents of this nature in an accessible place and inform your next of kin their location.

Photo credit: Hey Paul Studios

Sharon L. Herman AAMS, ADPA is the CEO of Silver Key Wealth Management, and affiliated with LPL Financial. www.silverkeywealth.com Sharon.Herman@silverkeywealth.com

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Silver Key Wealth Management, a registered investment advisor and separate entity from LPL Financial.
Ms. Herman may only discuss and/or conduct transact securities business with residents of FL, MI, GA, VA, NJ, TX. www.finra.org. www.sipc.org

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2 Quick Year End Ways to save on taxes

The end of the year is coming! Now is a great time to take a look at your financial house and see how you can save money on taxes.

1. Contribute to your IRA.
Your IRA contribution may be tax deductible. This tax deduction holds true if you currently do not participate in an employer’s retirement plan. Even if you can’t take the full deduction, all of the growth in your IRA will grow tax deferred. It can help make your compounding opportunities more powerful.

2. If you have prior investment losses, you can use them against current investment gains.
Do you have losses from years past? They carry over from prior years and can be used against gains this year. It may make sense for you to sell some of your investments with gains, offset those gains with prior losses and not have or lower your taxable gains.

See if either of these two ideas will help you keep some money in your pocket!

It is of crucial importance that you seek the advice of a tax advisor before executing any of the above suggestions. Each individual’s situation is different.

Sharon L. Herman AAMS, ADPA is the CEO of Silver Key Wealth Management, and affiliated with LPL Financial. www.silverkeywealth.com
photo credit: 401(k)2013

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results.

Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Silver Key Wealth Management, a registered investment advisor and separate entity from LPL Financial.
Ms. Herman may only discuss and/or conduct transact securities business with residents of FL, MI, GA, VA, NJ, TX. www.finra.org. www.sipc.org

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Why dollar cost averaging can be your best friend

What is Dollar Cost Averaging?

As an LGBT focused advisor, I get many questions about investing money each month to seek growth of your wealth. Dollar Cost Averaging is investing equal amounts of money into an investment over a period of time, and may be just the investment plan you need.

For example, let’s say that you want to contribute $12,000 into an investment account. You can deposit the $12,000 all at once. Another option is to Dollar Cost Average and invest $1000 each month.

Why not invest all at once?

For starters, most people aren’t very good at saving up a big sum of money then writing a check. Something always seems to come up and their money gets diverted to something else. That’s a pretty easy way to have your financial goals get off track.

If you set up your bank account to automatically have money sent to your investment account each month, then you don’t have to worry about writing that check. It’s done. Finished. Invested. A beautiful thing. Odds are that you going to “set and forget” and not notice the money being transferred.

Dollar Cost Averaging helps to stabilize your investments during a volatile market

Sometimes the market is up, sometimes the market is down. Sometimes your investment is up, sometimes your investment is down. If you invest some money each month, you are going to buy at both the lows and the peaks. It normalizes over time. That’s where the name Dollar Cost Averaging comes from. Your investment purchase price averages out over time. Actually, if your investment is going up over time, the price will go up over time. But when the market dips, you wouldn’t have put all of your money in at the high just to watch it drop.

How to get started

It’s easy! Most investment management firms, including mine, can set up DCA program for you. We can help you pick the right investment(s). You can pick the amount and the day of the month to invest. Then just watch your nest egg!

*Note – not all investments are available for dollar cost averaging. Some investments have a minimum amount to start, then you can DCA after the initial purchase. Please talk to an advisor for more information.

Dollar cost averaging involves continuous investment in securities regardless of fluctuation in price levels of such securities. An investor should consider their ability to continue purchasing through fluctuating price levels. Such a plan does not assure a profit and does not protect against loss in declining markets

Sharon L. Herman AAMS, ADPA is the CEO of Silver Key Wealth Management, and affiliated with LPL Financial. Sharon.herman@silverkeywealth.com

The opinions expressed in this material do not necessarily reflect the views of LPL Financial.
Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Silver Key Wealth Management, a registered investment advisor. Silver Key Wealth Management is a separate entity from LPL financial.

Ms. Herman may only discuss and/or conduct transact securities business with residents of FL, MI, GA, NJ, VA, TX. www.finra.org www.sipc.org

photo credit: Robert Donavan

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Don’t be a Donkey with your Money!

Hello my savvy LGBT investors! We see it all of the time. Commercials for the sleekest sports car, the latest and greatest gadget, or whatever the newest “must have” item is.

Most people don’t even realize that they fall victim to corporate marketing and it may lead them down a bad financial path.
Advertising to purchase goods, whether it’s car, clothes, jewelry, or whatever, is a way to make you think that you can’t live without their product. That your hard earned money, your time, your effort is worthy for exchanging for their item.
Think about it. Let’s say you make $40/hr. Luxury car maker guy wants you to buy their car for $40,000. You have to give up 1000 hours of your life for that vehicle. Actually, you give up more than that, once your figure in gas, insurance, maintenance, etc. Is that car worth giving up a half of a year of work? Really? It will still get door dings. It will still depreciate. Most people I know get over the excitement of a new car within the first year that they own it. It’s just a car.

The same thing can be said for other high priced items. A Rolex watch costs from 5k up to 300k. I hate to tell Rolex owners this, but time is the same everywhere whether you own a Rolex or a Timex. Who made it a luxury brand? Rolex did with their expensive advertising! They convinced the consumer that they really need to have a Rolex watch to be somebody important! It’s just a watch.
You exchange some of your time on this planet for money
I understand that people get enjoyment from owning certain things. I certainly want people to enjoy their lives. All I am saying is that you are exchanging a certain amount of time on this planet for working to make money. Are the things you are buying worth the time you are exchanging? Think about it the next time you decide to make a big ticket purchase.

As a financial advisor, I frequently see people who “wear their money”.
They drive the fancy car, have the expensive clothes, jewelry, toys, and have nothing saved. They get 5 or 10 years out from retirement and start to panic. They didn’t have their priorities right.

Don’t be a Donkey!
I like donkeys. They are loveable and rather cute. I wanted to use a word that begins with an “A”, but this is a family blog. Just don’t be a dumb “donkey” when it comes to your money.
I’m not saying that you shouldn’t treat yourself to nice things from time to time.

But make sure when you purchase these things, they don’t detract from your most important financial goal – taking care of your future.
Save for financial freedom first. If you have extra money AFTER all of those things are set aside for, then look at how you spend your discretionary income. Don’t spend your money on expensive doo dads first, then figure out what you have left for retirement, college for the kids, etc.

What do you think of buying luxury brand items?

Sharon L. Herman AAMS, ADPA is the CEO of Silver Key Wealth Management, and affiliated with LPL Financial. www.silverkeywealth.com Sharon.herman@silverkeywealth.com

The opinions expressed in this material do not necessarily reflect the views of LPL Financial.
Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Silver Key Wealth Management, a registered investment advisor. Silver Key Wealth Management is a separate entity from LPL financial.
Ms. Herman may only discuss and/or conduct transact securities business with residents of FL, MI, GA, NJ, VA, TX. www.finra.org www.sipc.org

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Focusing on the LGBT community and why it’s important

People have asked me, why are you putting so much effort into this blog and website?
It’s simple, really. I love our LGBT community and want to give back.
My idea for lgbtinvesting.com came one evening when I was at a networking dinner at a local restaurant.

A financial advisor I didn’t know was sitting next to my wife. He started asking her what I did for a living. She told him I was a financial advisor, had my ADPA accreditation and liked to work with the LGBT community.

His response was, “Oh, I have some of those on the books.”
My wife said “Some of what?”
He said “Some of those. Gay people. I have them in my book of business.”

He spoke to my wife like we were things, not people. My wife was very angry, as was I.  I had only heard the tail end of the conversation, but pieced it together pretty quickly. I feel awful for his clients. This advisor doesn’t care about them as people. Heck, he hardly sees them as people. They probably have no clue as to what he really thinks, yet they have entrusted him with their life savings. That probably won’t be a successful relationship for those clients.

It was then that I decided to be a voice.
If I can pass on advice to help you further yourself financially, then I feel pretty good. I mean, if people are running up against a guy like “some of those” out there in the community, then how is anyone going to feel comfortable about having a personal discussion about financial plans and investing?

I’ve met many people who haven’t felt comfortable about coming out to a financial advisor.
Even though parts of DOMA have been struck down, and same-sex marriage is being legalized across the country, it doesn’t mean that everyone loves us… and let’s be honest; folks in the financial services industry have the reputation of being staunch conservatives who aren’t very supportive of the LGBT community. It’s really not a surprise LGBT folks are apprehensive. I’m stilling running into guys like the “some of those” that I met at that dinner. I’m sure people in the LGBT community are seeing it, too.

There are many couples who don’t feel comfortable telling all their business to someone who they aren’t sure accepts them.
They certainly don’t want to give business to someone who will use the money they make to support people who are against the LGBT community. Talk about shooting yourself in the foot! I’m betting if the clients of “some of those” knew what he said, they would be furious!

I want to provide the kind of guidance that will help you make decisions that will be fruitful to your future.
I want everyone to feel that they have a place to turn to get investment advice. I also want everyone to know they have an experienced professional available they can turn to, if needed.
So now you know why I started this blog and try to dispense good, useful information to everyone. LGBT investors need a place to call home.

Questions? I’m happy to answer them!

Sharon L. Herman AAMS, ADPA is the CEO of Silver Key Wealth Management, and affiliated with LPL Financial. www.silverkeywealth.com
An ADPA (Accredited Domestic Partner Advisor) designated Financial Advisor can assist you with your financial planning and investment needs.
The opinions expressed in this material do not necessarily reflect the views of LPL Financial.
Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Silver Key Wealth Management, a registered investment advisor and separate entity from LPL financial.
Ms. Herman may only discuss and/or conduct transact securities business with residents of FL, MI, GA, VA, NJ, TX. www.finra.org. www.sipc.org

 

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The Rule of 72 and the 4% Draw

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Hello my savvy LGBT investors! Here’s a handy formula that I think you’ll find helpful. It’s called the rule of 72
72 pic

Credit: Kristy Hall
The Rule of 72 helps you figure out how long it will take to double your money
It’s pretty easy. First, take your rate of return on your investment.
For this example, let’s say you are getting a 10% return.
Divide 72 by that number.
In this case 72/10 = 7.2
The answer (in this case 7.2) is the number of years it will take for you to double your money.
Let’s do another one!
8% return
72/8= 9
So it’s 9 years to double your money.
So those people who have “safe” investments, like CD’s, that pay .5% interest?
It will take them 144 years to double their money!
That’s why you don’t want to put your long term money into short term investments!
I’m not saying that market volatility doesn’t play a role. It does. Certainly some years your portfolio will perform different than others. You may get 20% one year and -10% in others. Again, depends on you and your investments. But it’s handy for illustrative purposes. The rule of 72 is purely a mathematical concept and does not guarantee investment results nor functions as a predictor of how an investment will perform. It is an approximation of the impact of a targeted rate of return. Investments are subject to fluctuating returns and there is no assurance that any investment will double in value.
Why do you want to know this?
First off, you look pretty impressive at cocktail parties. But more importantly, you can use another rule of thumb that I like to use for an “off the cuff” calculation.
Many consider the safe standard to withdraw money from an investment account is a rate of 4%.
Now this isn’t written in stone. It can be higher, it could be lower. It all depends on what your investments are and risk tolerance. The 4% is a “be safe” sort of guideline.
You can use this to figure out how much money you will need for retirement.
Of course, this is a ballpark estimate. I have to emphasize ballpark.
Another example: If you need to pull of $30,000 a year off of your investment accounts, that means you’ll need to have $750,000 saved.
Using 4% as our draw rate:
30,000/.04 = 750,000
Where 30,000 is how much you want to take out of the account each year
The .04 is the 4% draw rate
The 750,000 is the resulting amount of principal with which you need to start.
Like I said before, this is not a hard and fast rule. Things like risk tolerance and investments in your account will make a difference. Certainly don’t use this formula as a substitute for a real financial plan. It might make you feel better about the amount you currently have saved. Maybe it will have you strive to save more.

An ADPA (Accredited Domestic Partner Advisor) designated Financial Advisor can assist you with your financial planning and investment needs.
Sharon L. Herman AAMS, ADPA is the CEO of Silver Key Wealth Management, and affiliated with LPL Financial. www.silverkeywealth.com
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Silver Key Wealth Management, a registered investment advisor and separate entity from LPL financial.
Ms. Herman may only discuss and/or conduct transact securities business with residents of FL, MI, GA, VA, NJ, TX. www.finra.org. www.sipc.org

 

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What is an ADPA and Why is it Important to LGBT Investors?

CDs

By Sharon L. Herman AAMS, ADPA

The ADPA (Accredited Domestic Partner Advisor) accreditation is a specialty designation that can be earned through the College for Financial Planning.

The accreditation addresses the unique financial planning needs of lesbian, gay, bisexual, and transgender (LGBT) individuals, as well as heterosexual couples who have chosen not to marry. Specifically covered are factors and situations that cause financial planning for domestic partners to be different from financial planning for legally married spouses, including wealth transfer, taxation, retirement planning, and estate planning issues; as well as alternative planning strategies for these situations.  www.cffpinfo.com/adpa.html

There are differences in financial planning for couples that live in states that do and don’t recognize same-sex marriage.

Working with someone who is specially educated and certified to know and understand these differences can help domestic partners and married couples pursue their financial goals in a more optimal manner.

 


 

Sharon_Herman_HeadshotSharon L. Herman AAMS, ADPA is the CEO of Silver Key Wealth Management, and affiliated with LPL Financial, the largest independent broker/dealer* in the United States. www.silverkeywealth.com

The opinions expressed in this material do not necessarily reflect the views of LPL Financial.

Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Independent Financial Partners, a registered investment advisor and separate entity from LPL financial.

Ms. Herman may only discuss and/or conduct transact securities business with residents of FL, MI, GA, VA, NJ, TX. www.finra.org. www.sipc.org

*Financial Planning Magazine (June 1996-2013 based on total revenue)

 

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