Tailored Financial

Investments, Insurance, Financial Planning

Nick Thom

Don’t Let Someone Go on Vacation on Your Dime: How to Keep Your Money Safe from Scammers

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Technology continues to grow and evolve, allowing us to stay connected and perform many daily tasks from home. There is a drawback to technology, however. It often leaves us more vulnerable to scammers who hide behind the anonymity that technology provides and find ways to scam us out of our hard-earned money. Work towards keeping your money safe and stave off scammers by following the tips below.

1. Know How to Spot a Scammer

While some scams are apparent, others are more difficult to spot. Most scammers will claim to be from an organization familiar to you, such as the IRS, Social Security, a utility company, or a well-known charity. Many even go as far as mimicking the name of a known company or entity on your caller ID, texts, or email so that you will answer them. Other signs that you may be dealing with a scammer are them pressuring you to act immediately or asking for payment with unconventional or non-secure methods.2

2. Don’t Open Emails if You Don’t Recognize the Sender

Clicking links through emails is one of the easiest ways for scammers to get your personal information or direct you to a fake site for payment. If you don’t recognize the sender or are unsure, you may try contacting the company directly via phone to see if they have sent the email. If an email uses a common company name, you may want to click on the name. This will show you to see the actual address the email is coming from, which will often not have the company tag at the end.1

3. Prioritize Updating Passwords Regularly

Scammers will often work by obtaining your passwords and using them to lock you out of your account, so they may use it or obtain private or financial information from you. Always be sure to choose passwords that are more difficult and take the time to update them every six months.1

4. Keep Up With Operating System and Security Updates

While it may seem like you are constantly getting requests to install updates on your electronic devices, doing them is vital. They often include security patches and updates that are designed to reduce your cyber-attack risk.2

5. Block Unknown Callers and Emails

If you receive unsolicited emails, texts, or phone calls, it may be wise to block them. By blocking them, you will be less likely to accidentally click on links that could be dangerous and also enjoy fewer useless messages.2

6. Don’t Give Out Personal or Financial Information to Anyone You Did Not Request Services From

Legitimate companies will not contact you and ask for identity or financial information unless they are responding to a request from you. This means you should not provide driver’s license numbers, Social Security numbers, bank account numbers, or credit card numbers unless you have initiated contact with the company.1

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by WriterAccess.

LPL Tracking #526895

Footnotes:

1 Avoiding Scams and Scammers, FDIC.gov, https://www.fdic.gov/resources/consumers/consumer-news/2021-10.html

2 How To Avoid a Scam, Consumer, FTC.gov, https://consumer.ftc.gov/articles/how-avoid-scam

Sources

https://www.fdic.gov/resources/consumers/consumer-news/2021-10.html

https://consumer.ftc.gov/articles/how-avoid-scam

8 Things Financial Planning Can Help You Address

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Financial planning is unique for each person; no two financial plans look the same because everyone’s life and personal goals are different. Regardless of what your goals are, financial planning can help you work towards achieving them. One of the most significant benefits of financial planning is that it gives you the confidence to stay on track towards your goals or make changes to pursue them.

Financial planning examines your current financial situation by assessing your budget, debt management, savings, retirement planning, insurance, and estate planning. The first year of financial planning may be more complex since your marital status, assets you own, income, health, financial literacy, employee benefits, number of children, and future retirement income are all factored into your plan.

 

A financial plan can’t guarantee protection from unexpected life events, but it can help you create a blueprint to work towards achieving these eight things:

 

  1. Establish an emergency fund- An emergency fund is money saved in an account to use during financial stress to help improve economic security.

 

  1. Create a budget- A budget is an estimate of income and expenses for a period, such as a month.

 

  1. Reduce debt- Whether you owe a few thousand or hundreds of thousands of dollars, paying off debt can lead to less financial stress and more financial security.

 

  1. Save money– Saving money can help prepare you for future goals and expenses and help protect you from financial emergencies.

  1. Improve your tax situation– A financial plan can help illustrate how tax-advantaged investment strategies may reduce your tax bill.

 

  1. Save for retirement- A financial plan can help illustrate retirement savings projections based on an assumed rate of return to help you determine if you are on track or need to revise your plan.

 

  1. Save for your child or grandchild’s education- Including education savings in your financial plan can help you estimate how much you need to save to reach your education funding goal.

 

  1. Save for other financial goals- Whatever your goal, a financial plan can help you work towards having the finances to achieve it.

 

An experienced financial professional can help guide you through the financial planning process by providing advice in several areas of your financial life. While every financial professional has their distinct strengths and specialties, they can also help you:

 

  • Determine if you’re on track with your goals
  • Provide a second opinion
  • Evaluate your investment strategies and implement new strategies
  • Assess your risk tolerance and time horizon to align with your goals

 

  • Rebalance your portfolio
  • Manage roadblocks that can impact your finances- job loss, divorce, etc.

 

Now that you know what a financial plan is and what it can help you address, take the next step and schedule a financial planning meeting with a financial professional today.

 

Important Disclosures

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

Rebalancing a portfolio may cause investors to incur tax liabilities and/or transaction costs and does not assure a profit or protect against a loss.

This article was prepared by Fresh Finance.

LPL Tracking #1-05315702

Protect Yourself From Tax Identity Theft as You Approach Retirement

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Tax identity theft is a serious type of fraud that affects individuals of all ages and stages of life. To steal a person’s tax identity, a scammer uses that person’s Social Security number and other personal and financial information to fraudulently file a tax return and claim a refund they’re not entitled to. Scammers often report little to no income and many deductions to get the largest refund possible.

What’s worse, the victim may not find out they’ve been defrauded until they attempt to file their actual return, only for it to be flagged and rejected—since the IRS already has a copy of the false tax return on file.

So, what do you do to prevent your tax identity from being stolen? Here are a few of the most common tax identity theft schemes and ways to mitigate them as you begin to approach retirement.

What Tax Identity Theft Schemes Are Most Common?

Here are common theft schemes to watch out for.

Phishing Scams

Scammers send emails or messages that appear to be from the IRS or tax preparation software providers. These messages ask for personal and financial information, often under the guise of a false need to verify information to prevent fraud. Never click on suspicious links or provide personal information via email or text to avoid falling victim to a phishing scam. The IRS does not initiate contact through email or social media.

Stolen Social Security Numbers

Thieves may use stolen Social Security Numbers to file fraudulent tax returns and claim refunds. To avoid this, safeguard your Social Security Number and other personal information. Don’t carry your Social Security card in your wallet. Only provide this number when absolutely necessary. Be sure to shred all documents containing sensitive data.

Impersonation Scams

Scammers may call or email, pretending to be IRS agents or tax professionals, and demand immediate payment for supposed tax debts. The IRS typically communicates by mail first, not by phone or email. Always be cautious of any unsolicited communication regarding your taxes.

How to Defend Against Tax Identity Theft

Here are some steps to take to manage risk.

Guard Personal Information

Safeguard your Social Security Number, financial account information, and other sensitive data. Only provide this information to entities you trust. Never share it online or over the phone unless you initiate the contact by emailing or calling the organization’s official customer service contact.

Use Strong Passwords and Two-Factor Authentication

Create strong, different passwords for each of your online tax accounts, financial institutions, and email. Do not use any password on more than one system. Always use two-factor authentication if it is available.

File Early

Filing your tax return early helps decrease the window of opportunity for scammers to file a fraudulent return in your name. If you’re due a refund, you want to file for it before a scammer does.

Monitor Your Credit

Regularly check your credit reports for any unusual activity, like new accounts you didn’t open or credit inquiries you don’t remember. Discrepancies on your credit report may be one of the first signs that your identity has been stolen.

Be Skeptical of Unsolicited Communication

If you receive an unexpected call, email, or message related to taxes, ensure it’s legitimate before taking action. Contact the IRS or relevant entity directly through their official website or phone number. If the call is really from the IRS, they’ll understand and encourage you to confirm it’s legitimate.

If you think you’ve become a victim of tax identity theft, immediately report it to the IRS, your state tax agency, and the Federal Trade Commission (FTC). They’ll help you resolve the issue. Consider identity theft insurance to help manage this risk.

 

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

This article was prepared by WriterAccess.

LPL Tracking #503492-03

 

Tax Prep Checklist: Everything You Need to Be Ready for Tax Season

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Regardless of whether you prepare your taxes yourself or use a professional’s services, it’s a good idea to gather the information and documentation you need well in advance of your actual tax filing date. Below, we’ve listed some key information you need when preparing this year’s taxes.

Your Personal Information

The personal information you may need to file taxes may contain information from your prior year’s return, including:

  • Your Social Security Number (SSN), along with SSNs for your spouse, if applicable, and any dependents
  • Last year’s Adjusted Gross Income (AGI) if you’re e-filing your taxes and need to confirm your identity
  • Any tax filing PIN you may have.

Your Income Information

Your tax return typically requires documentation for all the taxable income you received the previous year.

  • W-2 forms
  • 1099 forms
    • 1099-MISC for contract employees
    • 1099-K for those who receive payment through a third-party provider like Venmo or Paypal
    • 1099-DIV for investment dividends
    • 1099-INT for investment interest
    • 1099-B for transactions handled by brokers
  • Receipts, pay stubs, or any other documentation on income that isn’t otherwise reflected.

Your Deduction Information

Next, gather information on deductions that help reduce your overall tax burden. These include, but aren’t necessarily limited to:

  • IRA and other retirement contributions
  • Medical bills
  • Property taxes
  • Mortgage interest
  • Educational expenses like college tuition or student loan payments
  • State and local income taxes or sales taxes
  • Charitable donations
  • Dependent care expenses
  • Classroom expenses (for teachers)

There are other state-specific deductions that may apply to your situation.

Your Tax Credit Information

Credits may further decrease your tax burden. Unlike deductions, which may lower your taxable income, tax credits simply credit you a portion of what you’d otherwise owe. Some available tax credits may include:

  • Earned Income Tax Credit
  • Child Tax Credits
  • Dependent Care
  • American Opportunity and Lifetime Learning Tax Credits
  • The Saver’s Credit

Often, the information needed to receive these tax credits may be duplicative of other tax information. For example, having your retirement contribution records handy may support both an IRA deduction and the Saver’s Credit (if you qualify). Having your child’s SSN may allow you to fill out the Child Tax Credit section and the dependent care deduction. The more income- and deduction-related information you have in one spot, the more streamlined your tax prep process should be.

Your Tax Payment Information

Finally, gather and provide information on how much you’ve already paid in taxes, whether through estimated tax payments, income withholdings, or both. This helps you quickly calculate your total amount due once you’ve entered your income, deduction, credit, and withholding information.

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.

All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by WriterAccess.

LPL Tracking # 1-05206790

 

 

Source:

https://www.nerdwallet.com/article/taxes/tax-deductions-tax-breaks

Key Financial Wellness Metrics for Near-Retirement Individuals

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As one approaches retirement, monitoring your financial situation by understanding your net worth and assessing the assets and resources needed to maintain a comfortable lifestyle throughout retirement is vital. This article explores eight key financial wellness metrics individuals must monitor as they approach retirement.

  1. Income Replacement Ratio
    One of the primary financial wellness metrics is the Income Replacement Ratio (IRR), which calculates the percentage of your pre-retirement income that your retirement income will replace. Many individuals work toward a target ratio between 70-80%. Therefore, if you currently make $100,000 annually, your retirement income should ideally be between $70,000 to $80,000.

    2. Net Worth
    Net worth is one of the most fundamental financial wellness metrics, measuring the total assets, including savings, personal properties, and investments, minus any liabilities or debts. This metric gives an essential broad picture of your financial health and indicates financial stability that may allow you to support yourself comfortably in retirement.

    3. Liquidity Ratio
    The liquidity ratio is another critical metric that measures your ability to cover short-term expenses without selling long-term assets or taking on additional debt. This ratio is calculated by dividing your liquid assets, such as cash, savings, and short-term investments, by your current liabilities. A ratio of 1 or greater indicates a healthy level of liquidity.

    4. Savings Rate
    Your savings rate, the percentage of income you put aside for savings, is a critical component of retirement planning since it directly impacts the savings you’ll have available to support yourself. Financial professionals often recommend a savings rate of 10% to 15% of gross income. However, the savings rate may change depending on one’s situation, market conditions, risk tolerance, and timeline until retirement.

    5. Debt-to-Income Ratio
    Recognizing your level of debt is equally important when preparing for retirement. The Debt-to-Income Ratio (DTI) compares your total monthly debt payment to your gross monthly income, providing a deeper look at how you manage your debts. Lenders often use this metric to determine your ability to manage monthly payments and repay borrowed money. A lower DTI ratio indicates a good balance between debt and income.

    6. Medical Expense Forecast
    Healthcare can be a significant expense in retirement. Understanding your likely medical costs can help you plan for this considerable expenditure. Consider your current health status, anticipated medical needs, family medical history, and potential long-term care costs.

    7. Retirement Savings Lifespan
    Another crucial metric involves determining how long your retirement savings may last. By evaluating your expected annual withdrawal rate alongside your total savings and expected longevity, you can estimate the lifespan of your retirement savings.

    8. Investment Diversification
    Lastly, investment diversification, the degree to which your assets are spread across different types of investments, is a crucial metric in mitigating risk. A diversified portfolio may provide greater independence, especially during volatile market periods.

 

Since everyone’s retirement journey is different, these metrics provide a starting point to determine what is appropriate and realistic for your circumstances. It’s always advisable to seek assistance from a financial professional since calculating these metrics on your own may be complex.

 

 

Important Disclosures:

 

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

 

There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.

 

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

 

This article was prepared by Fresh Finance.

 

LPL Tracking #502413-04

 

Sources:

 

https://www.investopedia.com/terms/r/retirement-readiness.asp

 

https://money.usnews.com/money/retirement/iras/articles/4-metrics-to-measure-retirement-preparedness

 

 

 

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