Questions You Need to Ask Your Financial Planner

Though many people view a financial planner as a luxury only necessary for the extremely wealthy, the truth is that a financial planner can help almost anyone achieve their financial goals and grow their finances. If you’ve been considering working with a professional financial planner to improve your financial situation, you might be wondering how to go about choosing the right planner for you.

You’ll want to speak with a few different professionals to find the right person that can help you achieve your financial goals now and help you prepare for life shifts like retirement later. There are some things you will need to know about their background and approach to financial advising, so read on for a few questions you can ask a potential financial planner to help you find the right fit.

Ask about Fiduciary Duty

This is a very important question to ask your potential financial planner. Financial professionals that must abide by the fiduciary rule are considered fiduciaries, and they are required by law to act in the best interests of their client.

Nonfiduciaries, by contrast, are simply told to abide by a suitability obligation. This means any financial advice they give must be suitable, but they are not required to put a client’s best interests above their own. Financial advice that you get from a nonfiduciary may be influenced by commissions or other factors.

To get the best advice for you that is not influenced by any outside obligations or conflicts of interest, it is best to look for a true fiduciary when hiring a financial planner.

How Does Your Financial Planner Get Paid?

You must understand how your financial planner is paid. Ask about their payment structure and try to stick with fee-only planners if possible. Fee-only planners can charge a percentage of the assets they are managing (1 percent is common), an hourly rate, or a flat fee. Advisors and planners who work on a fee-only basis do not receive any commissions for recommending products, so it is easier to avoid conflicts of interest this way.

Don’t confuse fee-only with fee-based advisors; fee-based advisors still receive a commission for selling certain financial products.

Who Is Their Ideal Client?

Financial planners and advisors can have several specialties in different areas. When working with a planner, it is in your best interest to find a professional who has experience in an area that is important to you. For example, a young couple looking to pay down student loan debt and save for their first home may not want to seek out financial planners who mainly work with clients nearing retirement. Ask any potential planners to describe what an ideal client would look like for them to help you determine if their expertise aligns well with your goals.

Ask Them to Explain a Financial Concept

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A financial planner is someone you will likely work with for a long time. One good way to see if you will be comfortable working with them for the long-term is to ask them to explain something to you. If the explanation they give you is too complex or difficult for you to understand, then that is a good indication you should be looking for someone else. The person you work with to help you make financial decisions should be able to explain these concepts to you easily and in a way that you can clearly understand.

Do They Have Any Disclosures on Their Record?

Financial planners are there to help you make important decisions about your financial future. If they or their firm have faced any criminal, regulatory, or disciplinary actions of any kind, then that is something you definitely need to know about. To double-check, you can look over the firm’s Form ADV, which will contain these types of disclosures.

You can access that information through the SEC’s Investment Advisor Search tool (on the website for the US Securities and Exchange Commission) in an online format, or you can also request copies of the written paperwork through an SEC branch.

Ask about Their Investment Strategy

The general investment philosophy of the firm is something you will also want to ask about early on. It’s important that they can explain their investment philosophy in terms you can easily understand.

You’ll want to have an advisor that has a philosophy that aligns with your own; this will make it much easier to stick with the plan when the market isn’t going well. Some important points would be types of investments they recommend, diversification, growth versus value, and trying to time the markets. Market timing is when financial advisors try to predict what’s going to happen and recommend shifts in your portfolio based on simple hunches. This could cost you significantly, since timing the market incorrectly can have big consequences.

Important Points You Should Know about Roth IRAs

Nowadays, most people cannot count on Social Security to provide enough income during their retirement years. They will need to think strategically about the types of accounts they will need once they retire and make sure they set themselves up for financial security.

The tax-advantaged retirement accounts generally come in two different setups. The traditional account, such as an individual retirement account (IRA), involves pre-tax income that grows without any tax implications. However, once the money is withdrawn from the account in retirement, you will pay income tax on it. The other primary option is a Roth account, such as a Roth IRA, which involves post-tax money with no tax implications for withdrawals.

The Roth IRA, named after William Roth, was created in 1997. The main advantage of this account is that it allows deposits to grow without any sort of taxation. Also, Roth IRAs have many advantages over traditional accounts. For example, contributions can be made at any age as long as you have earned income, and account holders face no required minimum distributions, which means the IRA can be held indefinitely.

Roth IRAs can be funded via regular or spouse contributions, conversions, rollovers, and transfers. Contributions must be in cash rather than existing securities or assets. The limits to contributions are the same for Roth IRAs as traditional accounts.

Some of the Key Benefits of Opening a Roth IRA

One of the truly unique features of a Roth IRA is access to funds. Account holders have easy access to the contributions they make to a Roth IRA, which is not the case with traditional accounts.

If you put $5,000 in a Roth IRA and the account later grows to a value of $10,000, you can withdraw the initial investment of $5,000 at any time without paying any sort of income tax or penalties. With Roth IRAs, you can always access contributions before tapping into investment gains, which is not possible with a traditional IRA or a 401(k). With these two accounts, withdrawals always trigger income taxes and further penalties depending on age. For this reason, a Roth IRA can provide you with easy access to money and liquidity that is not possible with other retirement accounts.

Many people use Roth IRAs for tax savings while in retirement. Once retired, you can withdraw from both contributions and investment gains without paying any sort of income tax. A Roth IRA does not increase the tax liability or tax rate for retirees, and withdrawals have no impact on Medicare premiums or Social Security taxes. The tax-free nature of the account can help you save money in retirement. For example, if you wanted to purchase a new car in retirement through a traditional account, it would involve paying taxes on the withdrawal on top of sales tax and other fees. If you have the money for the purchase through a Roth IRA, you could save a great deal on tax liability.

The unique tax situation of a Roth IRA can also allow you to save money on taxes in retirement. Think of opening a Roth IRA as diversifying your income options in retirement so you can be more strategic and reduce your tax liability. A Roth IRA can keep you from entering a higher tax bracket and owing more money to the government.

Imagine a year in which Social Security and distributions from tax accounts bring you very close to the line for a higher income tax bracket. For the rest of the year, you could take money only from your Roth IRA, which has no tax implications, and maintain a high quality of life without owing more than expected in taxes.

How to Open and Fund a Roth IRA

A major downside to the Roth IRA is that it is not an employer-sponsored account, so you will need to be proactive about creating an account. However, doing this due diligence is just a limited investment of time. The IRS has permitted brokerage companies, credit unions, loan associations, and banks to offer IRAs. Most people choose to open an IRA with a brokerage.

Also, you can open a Roth IRA at any time, but the contributions for a given tax year must be made before the deadline for filing taxes, which is usually April 15 of the following year. However, you can still contribute to the prior year up until that deadline. Importantly, extensions granted for filing taxes do not apply to Roth IRA contributions.

Choosing the right financial institution is key as not all IRA providers have the same investment options. And while some providers may have many different options, others may be much more restricted.

Furthermore, virtually every institution will have its own fee structure, so it is important to review this information. Fees can have a big impact on the overall returns if they are too high. Investors who like to manage their accounts actively should look for providers with low trading costs, while those who prefer a hands-off approach should make sure there is not an account inactivity fee. Another piece of information to look at is the minimum account balance, which can be high in some cases.

Getting Started with Financial Planning, No Matter How Much Money You Have

Though many people consider financial planning as something only necessary for those with a substantial amount of wealth, the truth is that anyone can benefit from a good financial plan. Financial plans are a way to secure your financial future, build wealth, and afford large purchases or emergencies without going into debt.

You don’t need to be wealthy right now to put a good financial plan into place; you only need to care about stabilizing your financial future. Here are a few tips to help you create and maintain your own personal financial plan today.

 

What Is a Financial Plan?

Simply put, a financial plan is a complete picture of your current financial situation, the goals you have for your financial future, and the plans you have to meet those goals. Your financial plan should include accurate figures for your savings, cash flow, investments, debts, mortgage, insurance, and any other components of your financial assets and liabilities.

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Anyone can create a financial plan for themselves, and it’s never too early to start working to achieve financial independence. Many people assume that without substantial wealth to their name, a financial plan is expensive or simply not worth the time and energy, but that couldn’t be farther from the truth. A financial plan is certainly useful for managing wealth, but it can also help you build that wealth by helping you gain control over your money and set and achieve realistic financial goals.

 

Understanding Your Financial Plan

An important thing to remember when you are putting together your own financial plan is that this is not a “one and done” task. Good financial planning requires reassessments and readjustments of your goals as your financial situation changes over the years. You must be willing to sit down every few years to reassess your assets, liabilities and goals, making adjustments as needed.

 

Have an Accurate Picture

The first step on the road to creating your financial plan is to have a clear and accurate picture of all your finances right now. Start by assessing where your money really goes—track all your expenses for a month or two. What you find may surprise you! Be sure to also include quarterly, yearly, or other non-monthly expenses.

Once you have an accurate picture of your spending habits, you will be able to make decisions about where cuts can be made and how you can redirect your money toward your financial goals. Then, you can draw up a budget that reflects this.

 

Plan for Emergencies

The most important thing you can do to establish your financial plan is to start out with an emergency fund. Sudden expenses, like medical bills, car accidents, and other sudden costs, can wreak havoc on your finances if you don’t have an emergency fund set aside. It’s ok to start out small by contributing as little as $10 per week—anything is better than nothing.

Conventional advice says to save three to six months of expenses for your emergency fund. Where you fall on this spectrum depends on your risk of losing your income, your access to other sources of financial support (like a relative who could bail you out), and whether you’re in a single or double-income household. If you work in an industry with high turnover and you don’t have a partner or family member to fall back on, you may want to create a fund that will see you through six months.

 

Manage Any High Interest Debt

One of the most difficult aspects of personal finance for many people is high interest debt piling up. If you want to gain control over your finances, a good way to start is by focusing on paying down those high interest debts, like credit card debt, title loans, rent-to-own payments, or payday loans. If these high interest debts are holding you back, it might be worth your time to consider a debt consolidation loan or other debt repayment plan to get a handle on them. It’s easy for debt to spiral and eventually cost you more than two or three times what you originally owed as interest piles up.

 

Define Your Goals

Goals in financial planning generally fall into two main categories: short or medium-term goals (think purchasing a house, saving for college, or funding a wedding) and long-term goals (funding your retirement, primarily). As you start creating a financial plan for yourself, write down specific goals for you and your family. These may change over time, but having a concrete idea of what you’re aiming for is helpful.

Consider also setting up automatic savings transfers so that putting money aside is easier. Many financial advisors suggest paying yourself first in order to meet your goals; that means before you pay any bills, put a percentage of your paycheck aside in your savings account. You’ll be less tempted to decide you just don’t have enough to save this month if it goes into savings before you even see it.

Remember, it’s never too early to start putting money aside for retirement. If your employer currently offers matching contributions for a 401(k) plan, take advantage of this as much as possible. Those matches essentially constitute free money for your retirement, so it is definitely something you want to take advantage of now.

Financial planning is a great way to ensure your personal financial future, whether you’re wealthy or not. Start planning for you and your family today!

This Is What You Need to Know about Investment Risk in Retirement

When investing for retirement, risk tolerance generally changes over time. Individuals who are decades away from retirement typically accept a larger amount of risk for the chance to achieve significant growth, which is one of the benefits of saving for retirement earlier rather than later.

As individuals get closer to retirement, they tend to get more conservative to protect their nest egg from market fluctuations. With decades to spare, individuals can wait out lows, but this is not always possible in retirement when people may need immediate access to money.

Prior to retiring, individuals should take the time to look at their investment risk and make sure they are not jeopardizing their ability to make ends meet in retirement.

The Issue of Investment Risk during Retirement

Balancing investment risk in retirement has become a more complicated issue in the past decade or so. People are living longer than ever before and cost of living continues to increase. Many individuals are asking themselves how they can make their nest egg last for 30 years without taking on at least some risk during their retirement years to help those investments continue to grow.

At the same time, being too aggressive during retirement can mean losing big and possibly running out of money. The risk is greatest during the first few years of retirement. Taking a big loss at this point in time can cause issues for the rest of retirement and may even make it impossible to recover.

retirement investing

Because of this issue, some people minimize their risk in the years before and after retirement. Then, these individuals slowly increase investment risk to get the best of both worlds.

At the same time, getting more aggressive with risk later in retirement comes with its own complications. This situation is most frequently encountered by people who have not saved enough money to retire comfortably and need to play catch-up.

Individuals in this situation are likely to take losses much harder than gains, according to recent research. When people are unable to deal with losses in an acceptable manner, they may end up panicking if the market has a downturn and selling their stocks.

This is a losing strategy since it does not allow for normal recovery. Realistically, people should only accept retirement risk in retirement if they have the mental capacity to handle losses strategically instead of panicking.

The Decision of How Much Investment Risk to Accept

The decision of how much risk to accept in retirement is ultimately a personal one. Individuals need to consider how much they have saved and their projected budget for retirement. These two data points can help people figure out how much wiggle room they have financially.

People should view the amount they need from their investment accounts to meet annual spending projections the minimum level of productivity for those accounts. The amount of their nest egg needed to produce this amount should be protected from risk as much as possible. Any money in retirement accounts beyond that could theoretically be invested aggressively provided that people can deal with market fluctuations, since individuals would still have the minimum amount that they need to make ends meet.

The general rule of thumb is that people should never take on more risk than they need to meet their financial goals during retirement. However, there are situations in which increasing risk could make sense provided that the minimum monthly income is still met.

For example, some individuals want to build wealth to leave a legacy for heirs. In this case, goals will change over time. At the beginning of retirement, people in this situation want to have enough to maintain their lifestyle, but later they will want to build their wealth as much as possible.

These individuals often take more risks as they get older since they have enough to maintain their lifestyle and want to get as much as possible out of their investments. In this situation, it is still important not to invest so much that a market downturn could hinder the ability to cover monthly expenses.

The Other Option to Consider with Retirement Investing

Adjusting allocations during retirement is risky, whether that means increasing or decreasing the percentage of a portfolio in equities. People may find themselves forced to buy stocks when they are high or sell when they are low. For this reason, many financial advisors recommend keeping allocations fairly constant throughout retirement, but the decision ultimately depends on someone’s unique situation.

A safer way to invest in retirement involves adjusting spending rather than allocations. With this strategy, individuals change their spending based on market performance. If the market goes down, individuals can dial back their discretionary spending as a means of protecting their nest egg rather than changing their portfolio allocations.

Bear markets are temporary, but the losses incurred with selling off stocks during them are permanent. Adjusting spending is a way to avoid the panic impulse of selling off stocks and helps bridge the gap until market recovery occurs, at which point the losses will no longer matter. The other thing to keep in mind is that recessions tend to follow a bear market, so people may actually save money by postponing discretionary spending, such as vacations, and taking them later when it is actually cheaper to do so.

6 Important Questions Your Financial Advisor Should Ask You

Despite recent reports that just under half of all American adults can handle an unexpected expense of $1,000 or more, the majority choose not to seek outside financial help. In fact, only 17 percent use a financial advisor, according to a 2019 CNBC and Acorns Invest in You savings survey.

Many people who choose to handle their finances on their own make costly mistakes, such as simply guessing how much they would need for retirement and not saving early enough. In 2018 the National Financial Educators Council found that self-directed financial management mistakes cost the average American $1,230.

Working with a Certified Financial Planner® (CFP) can lessen the likelihood of these potential losses and help individuals and families strengthen their long-term financial situation. In 2019 Certified Financial Planner Board of Standards, Inc. examined consumer confidence regarding financial security in the face of a potential recession and found that 73 percent of respondents who worked with a CFP® felt more prepared now than they did during the financial crisis of 2007-08.

Finding a CFP® is an important safeguard to protect your assets, but it’s even more critical to find one who understands your unique financial situation and aspirations. When you’re looking for a CFP®, find one who asks these six questions.

 

“Can You Tell Me about Yourself?”

Your advisor should want to get to know you and what’s important regarding your personal life and retirement savings plan. One of the most efficient ways they can do this is by asking the aforementioned, open-ended question. This allows you, the client, to direct the conversation and relay information that you might not have even thought was central to a savings plan. For instance, if you own a business, your advisor might ask you to consider tax minimization or legacy planning. Beyond that, this exercise allows the advisor to know you and your family better, which, in turn, can help improve trust and forge a deeper, meaningful connection.

 

“What Made You Seek Independent Advice?”

Once your advisor knows more about you, they should attempt to gauge why you sought out independent financial advice. In doing this, they can get a better idea of where you need support and direct their efforts to ensure they meet your demands in these areas. Some people might simply not have the time to focus on their finances and require comprehensive help, while others need guidance in a specific area. Other reasons people hire advisors include a change in financial goals or family dynamic or altered tax status as a result of a recent move.

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“What Are Your Goals?”

Many people look to financial advisors for assistance with retirement savings plans, but there is an abundance of other goals you might have concerning financial planning. By asking about your financial goals and objectives, your advisor can not only help you determine specifically what it is you intend on saving for but also implement a unique plan designed to meet those expectations. Some of the most common goals outside of retirement savings include education funding, estate planning, asset allocation, and major purchases.

 

“What Are Your Most Pressing Financial Concerns?”

While your advisor will work with you on a comprehensive wealth management plan, they must know your most pressing financial concerns so that they can be addressed immediately. For instance, if you are getting divorced or remarried, your advisor will be able to help you navigate concerns regarding the division of assets and investments and determine whether you have enough income to support various lifestyle choices.

 

“Where Do You See Yourself in Five Years?”

Financial planning isn’t only about creating a long-term strategy with the end goal of saving for retirement. As mentioned, people have many different financial goals and aspirations, some of which they may want to achieve within the next few years. A good advisor will ask you where you see yourself in five years to help create a comprehensive plan that might include expenses related to marriage, having children, or buying a house. They can even take into account factors such as debt and inflation.

“With debt and living expenses on the rise in much of the country, the importance of setting financial goals—and sticking to them—has never been greater,” noted First National Bank of Omaha executive vice president of consumer banking Jerry O’Flanagan.

 

“What Do You Expect out of This Relationship?”

The simple answer to this question is the fulfillment of financial goals and aspirations, but it’s also important for both you and your advisor to think about considerations that will help ensure a successful relationship. Before meeting an advisor, you should have an idea about what you expect from them, and, in turn, be clear and concise in voicing your goals and concerns. If you’ve never worked with an advisor before, consider past service relationships and what you did or didn’t like.

5 Things You Should Know Before Retirement

Planning for retirement can prove extremely stressful, as individuals are forced to prediction how much they will need in retirement. Even when individuals save proactively and create a detailed plan for their retirement years, they are bound to run into some surprises. Retirement is designed to be a time of relaxation and exploration rather than a source of constant stress. Research has shown that the majority of people find retirement to be different than what they had expected. Becoming aware of issues that have caught other people off guard is a smart way to prevent them from happening to you. The following are some of the most common aspects that retirees wish they had known prior to retirement.

1. Emergency expenses can wipe out savings.

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Some people are shocked by how much emergency expenses can drain their savings. Everything from unexpected home repairs to car trouble can put significant pressure on your retirement income. One study found that less than 20 percent of retirees are adequately prepared to handle the costs of home repairs. Issues like broken furnaces or air conditioning units can cost thousands of dollars to repair and become serious financial problems, particularly for retirees who are still paying off their mortgage. People should look closely at their home in the years leading up to retirement to figure out what issues could arise and how much money would be necessary to fix them. Of course, preparing for all of these emergency expenses is not always possible, so it pays to have a significant emergency fund already created upon retirement. Ideally, it should be several times larger than the one that they maintained while still working.

2. Medicare does not cover long-term care.

Another aspect that some people may not understand are the limitations of Medicare. This plan has a number of holes that people should be aware of, including long-term care. Someone who has just turned 65 has a 70 percent chance of requiring long-term care at some point. Unfortunately, this type of care can cost a significant amount of money. Retirees can quickly go bankrupt when they require this type of care. One way to prepare for long-term care costs is through insurance. Although many young and healthy people do not think about purchasing long-term care insurance, the premiums are considerably cheaper when they are further away from retirement. Also, a tax break exists for purchasing this type of coverage. At the same time, the premiums can be quite costly, so it is important to factor this expense into savings and ensure that the overall health coverage is adequate.

3. Inflation can severely cut into your retirement income.

Many people who retire do not understand how significantly inflation can impact their overall income. Retirement planning needs to take inflation into account to ensure that people continue to have the money they need to live decades down the line. In retirement, inflation can disproportionately affect expenses, such as Medicare premiums, out-of-pocket health care costs, and long-term care costs. Overall, the cost-of-living increase for Social Security benefits has not kept pace with the increase in average cost in these categories, which means that people may need to rely more heavily on their investments over time. Even without the excess price growth in these categories, inflation can cause prices to double approximately every 20 years, which means that a retiree’s expenses will look very different at 85 than they did at 65.

4. Dividend income is not always stable or even safe.

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Historically, retirees have frequently relied heavily on bond interest payments and stock dividends to finance their lifestyle in retirement. However, this strategy is not without risks, as a reduction in share prices can cause payments to decrease or companies to simply choose to cut dividends. Unfortunately, retirees may be surprised by the loss of dividends and find themselves in a difficult place if they do not have an alternate plan. In recent years, many of the most significant stock dividends have decreased precipitously, which makes this strategy less appealing for people who are nearing retirement. In truth, stocks that pay dividends can provide a great source of retirement income, although they must be balanced with other types of investments so that individuals are not seriously affected when their income decreases.

5. Working longer is not always possible.

Surveys have found that people who are currently working plan to retire at a much older age than has been the historical average. This finding may be related to the fact that people in general need more time to save in order to meet their retirement goals. While working longer is an admirable goal that can prove very beneficial for a number of different reasons, it is not always something that people can count on being able to do. Some people get laid off from jobs that they have had for decades and find it difficult to find a new one, while others may have health problems that preclude them from working. Even an apparently voluntary retirement can be the result of getting pushed out of the company through an early retirement package or a change in the workplace culture. People in this position can find jobs that are part-time and that often pay less in order to help bridge the gap to full-time retirement, although this itself can prove difficult and stressful.

Due Diligence – A KeyAspect to Succeed in Cryptocurrency Investing

Introduction to the Mind Your Own Business Act

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Provisional Income
Image: investopedia.com

In addition to his notable work in retirement planning and financial literacy education, Robert M. Ryerson is experienced in identifying theft and protection. Robert M. Ryerson is the author of the book, “What’s the Deal With Identity Theft”, a proponent of the data privacy act introduced to Congress by Senator Ron Wyden.

Known as the Mind Your Own Business Act, the proposed legislation will hold tech CEOs and other high-level executives personally liable for misuses of user’s private data. Alongside leveraging fines and jail terms for executives who attempt to cover up privacy breaches, the Act will also offer consumers more control over their data through the “Do Not Track” system. Under the Act, all large social media companies will be required to provide users the ability to opt-out of data tracking services.

As many tech companies argue that selling user demographic data is vital for their business models, the Act will allow firms to charge those who opt out of tracking a minimal fee. Since this may make some social media outlets an untenable expense for lower-income individuals, the Act would also introduce protocols to minimize any financial burdens on the economically-vulnerable who wish to retain their privacy.

Top Four Cryptocurrencies in the World

Freehold, New Jersey resident Robert M. Ryerson is a Certified Financial Planner at New Century Planning. Knowledgeable on various investments including alternative assets like cryptocurrencies, Robert M. Ryerson speaks at educational seminars about the different types of digital cash technologies. Below are four top cryptocurrencies in the world as of the first quarter of 2020:

1. Bitcoin – Established in January 2009, this was the first decentralized peer-to-peer electronic cash system. It is also the most popular with a market cap north of $121 billion.

2. Ethereum – Founded by Vitalik Buterin, this cryptocurrency was launched in July 2015 based on the founder’s belief that there was a need for a new peer-to-peer platform with a more general scripting language allowing decentralized apps to be built and run around it. It has a market cap of slightly over $14.9 billion.

3. Ripple XRP – Developed by the Ripple Company, this is a real-time global settlement network facilitating instant, low-cost, and transparent international payments. It has a market cap of about $7 billion.

4. Tether – One of the first cryptocurrencies to peg themselves to an actual currency or other tangible assets, Tether was launched in 2014 as a platform to support the use of paper currencies in the digital sphere. It has a market cap of over $4.6 billion.

Robert Ryerson to Fox Business: New Privacy Legislation “Much Needed”

  Robert M Ryerson is a certified financial planner and author of “What’s the Deal with Identity Theft – A Plain English Look at Our Fastest Growing Crime.” Robert M Ryerson recently told Fox Business that he supports proposed legislation to strengthen privacy protections for consumers.

In a report about Facebook CEO Mark Zuckerberg’s testimony to Capitol Hill regarding his venture into cryptocurrency, Mr. Ryerson weighed in on a bill proposed by Democratic Sen. Ron Wyden that would be known as the Mind Your Own Business Act.

The legislation would offer consumers an “easy, one-click way to stop companies from selling or sharing their personal information.” It would also improve transparency regarding how corporations use their data.

Mr. Ryerson described the legislation as “much needed” and “both timely and practical,” given that most of our personal data is now in the cloud and accessible by a range of entities. Stressing that our data is regularly used online by employers, medical professionals, and more, Mr. Ryerson cautioned that the best way to protect against identity theft is with a plan that includes restoration services.

Converting 401(k)s and IRAs to Roth Status Can Save Tax Dollars

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Tax fliling Photo by Kelly Sikkema on Unsplash

Robert M. Ryerson has worked as a Certified Financial Planner since 1991. On a mission to help America’s workers secure their financial freedom during retirement, Robert M. Ryerson educates people about to retire on required minimum distributions (RMDs) and how they will affect their taxes during retirement.

Once a person reaches the age of 70 and a half, he or she must make RMDs from his or her 401(k) or IRA. These distributions will be usually be taxed. These taxes can be considerable, especially if the person is already collecting social security or is earning income from other investments. However, with some planning, you can save tax dollars occasioned by RMDs.

A good way to reduce taxes on RMDs is to convert traditional IRAs or 401(k)s to Roth IRA investments. Those working with employers offering Roth 401(k) options can convert these funds. If this option is not available to you through your work, you can still convert your IRA to Roth status. This should be done before retiring and before reaching age 70 and a half. When putting funds into a Roth IRA, you are taxed now when you are still working, rather than later on after retirement. This can generate huge savings, especially if you expect to earn significant amounts of money after retirement.

Why Children Are Vulnerable to Identity Theft

Robert M. Ryerson
Robert M. Ryerson

Certified Financial Planner (CFP) Robert Ryerson of New Century Planning possesses more than 25 years of experience in estate management and retirement planning. Additionally, Robert Ryerson is a Certified Identity Theft Risk Management Specialist (CITRMS) and author of the book What’s the Deal with Identity Theft: A Plain English Look at Our Fastest Growing Crime.

In 2017, more than a million children, two-thirds under the age of 8, were victims of identity theft or fraud, resulting in losses of more than $2.67 billion. Because a child’s Social Security number has not been used before, it is more valuable to criminals.

When a bank uses the child’s Social Security number to pull a credit report, nothing suspicious appears, so criminals can use the number freely. Typical warning signs of a child’s identity being used fraudulently include the child receiving pre-approved credit card offers or jury summons in the mail. In the event of suspicious activity, parents can place a freeze on the child’s credit report to prevent the opening of new credit accounts.