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Roseville Experts Give 7 Golden Retirement Mistakes to Avoid

Building your nest

How to Save for College at Every Age for Education

Financial Aid

Adams Ashby Financial Advisors

I’m in the business of helping people plan for their future. As a financial planner, my responsibilities are to assess where my clients are

The Good, the Bad and the Ugly

In 2008, the economy played the largest role in influencing several changes in our tax system. Since there’s much more to each of the issues discussed below, we recommend that you consult your tax professional on the specifics. Here’s an overview of some of the changes affecting us in 2009.THE GOODEconomic Stimulus Checks – Get a second chance at those rebate checks, maximum of $1,200 for married couples and $300 per each qualifying child. If you were short changed last year because of various technical requirements from your 2007 tax filings, you can claim the difference based on your 2008 data when your return is filed in 2009. This is especially beneficial if you had a child or adopted a child in 2008. And if you would have received less based on 2008 data, you are not required to give back the difference on the amount you already received.  Homebuyer Credit – First time homebuyers, who are defined as anyone who has not purchased a principal residence in over three years, can receive a refundable tax credit of up to $7,500 or 10 percent of purchase price, whichever is less. The home must have been purchased after April 8, 2008 and before July 1, 2009. You can apply qualified 2009 purchases in the 2008 tax return. Unfortunately, you have to start repaying the credit to IRS over a 15-year period beginning in the second year after purchase. So technically, it’s more like an interest-free loan.   Property Tax Deduction – taxpayers who claim standard deduction can claim extra deductions for local real property taxes for 2008; maximum of $1,000 ($500 for single).   THE BADOil – Due to severe changes in gas prices, Congress changed the standard mile deduction for business purposes in the middle of the year; first half at 50.5 cents per mile and second half at 58.5 cents per mile; moving and medical miles were 19 cents for first half and 27 cents for second half of the year. Charitable miles still stands at 14 cents.Stock Market – No relief on the required minimum distribution (RMD) for 2008; only for 2009. The theory to not require RMD is that retirees should not be forced to take a distribution from their retirement accounts when the value of that account has plummeted, especially since the calculation or the RMD for 2008 is based on the account value as of December 31, 2007.  THE UGLYForeclosures and Short Sales – The real estate melt down has been the most prominent “Ugly” and largest contributor to the economic downturn. Luckily, Congress did come through here. Taxpayers can exclude from income up to $2 million of qualified principal residence indebtedness for discharges incurred on or after January 1, 2007, and before January 1, 2013. Generally, debt discharge would be considered income to taxpayers.  Auto Industry Bail Out– Even the tax incentives didn’t help the auto industry. Congress enacted a temporary increase in the allowable depreciation deduction for passenger vehicles under the luxury car rules. Basically, taxpayers could deduct over $11,000 as first-year depreciation on business use vehicles purchased and placed in service in 2008.  Again, these are just a few of the changes and only a brief discussion on each, making this a critical year to ensure you have expert advice.<hr>John Choi, CPA JD is with Professional Solutions Group, LLP in Roseville. He can be reached  at 916-791-3120 or john@prosolutonsllp.com.

Paying for College

They got the grades. They got the acceptance letter. You’re getting the bill. Sound familiar? If you’re the parent of a high school student, and college tuition bills are causing anxiety, don’t fret. There are many avenues available for financial aid, regardless of your yearly income, plus savings plans for students and parents.First Things First: The FAFSA“One of the biggest myths about a college education is that students can’t afford one,” says Brett Tujague, Advancement Via Individual Determination (AVID) Coordinator at Roseville’s Woodcreek High School. He advises all his college-bound students to apply for financial aid, regardless of their family income.Financial aid is broken down into two main categories: grants/scholarships (money you don’t have to pay back), and loans (money you do have to pay back). The gateway to all financial aid is through the Free Application for Federal Student Aid (FAFSA). Students will not receive any aid, not even student loans, without filling out the FAFSA. Both parents and students need to sign up for a PIN to electronically sign the FAFSA, which is quick and easy to do at pin.ed.gov. Families should only fill out the FAFSA at fafsa.ed.gov, where the application is free. Many scam sites charge a fee to fill out the application, so don’t be fooled. The FAFSA filing period is between January 1 and March 2 each year. Once a student’s FAFSA is processed, the family will receive a Student Aid Report (SAR) that states the Expected Family Contribution (EFC) number on it. This number is the amount of money a family is expected to contribute to their student’s education. A family’s EFC does not change based on the school’s price tag. In some situations, a private college or university may end up being less expensive than a public one....Savings PlansThere are numerous investment vehicles to choose from when financially preparing for college. Edward Jones, with advisors in Folsom and El Dorado Hills; as well Amerprise Financial of Folsom, both help families set up savings plans. A 529 plan, which offers tax incentives and currently is not included in the child’s assets for financial aid, affords you flexibility while saving money for tuition and even related expenses. With a little forethought and smart money management, a first-rate education can be affordable.For more information on College Funding tips and ideas, be sure to pick up this month's copy of Style – Roseville, granite Bay, Rocklin edition. Check out the Distribution tab on this Web site for some of our newsstand locations. Or, to order a copy of this issue, please email  info@sierrastyle.com, or call 916-988-9888.

Investing in Turbulent Times

Do you have your seat belts on? What a ride so far! You’ve enjoyed the exhilaration of the ride up and screamed through the gut wrenching sensation of being dropped. Now you’re just nauseated and want it all to come to an end so you can plant your feet firmly on the ground again. Sound familiar? For those long-term investors, this may be déjà vu – although the media would beg to differ, saying it's “different” this time. While the media provides a valuable service, we are in an age of over information. Too much information makes it difficult to decipher the good from the bad and the bad from the ugly. Besides, the information provided is usually based on a shorter-term perspective. Speaking of the media, remember: FEAR SELLS! Headlines are exactly that. There’s usually no room for optimism on the front page. So what is one to do? Warren Buffet puts it very aptly: “We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.” Or to put it as John D. Rockefeller once said, “The way to make money is to buy when blood is running in the streets.” Well, the streets are turning red…And, an interesting point to note is that one contrarian indicator of the market is consumer sentiment. When it is at its lowest, that’s when opportunities abound. Unfortunately by that time, the masses are driven by panic and despair. While this is all great for investors sitting on the sidelines, what about the ones who are already invested? Here are some investment pointers to keep in check for those of you who are holding on tight. 1. Stay diversified. That is, assuming you already have a well-diversified portfolio between various asset classes. Staying the course in both good and bad times is usually recommended. Based on a study by research firm Dalbar, in the 20 years through 2006, the S&P 500 returned an average annualized return of 11.8 percent, whereas an average individual investor earned only 4.3 percent. The disparity is mostly from getting in and out of the market and missing out on the up-swings. 2. Don’t stop that dollar cost averaging. If you’re not doing it, start today. Remember, you’re buying shares on “sale” and hence, buying more shares with a constant dollar amount. 3. Stay with the investment objective. If investing for long term, think long term. In other words, focus on the forest, not on the trees. Nothing goes up forever. Neither does it go down forever. And no, the world is not coming to an end – although it may seem so nowadays. Stay invested. When the markets turn around, you want to be positioned to benefit from the up swing. 4. Get a portfolio check-up if you haven’t had one in a while. It may not be a bad idea to review investments every four to six months to ensure they are aligned to your goals. These few steps, as simple as they may sound, are easier said than done, but practice does make perfect! And finally, make sure your seat belts are on, and hold on for just a little longer. Rashida Lilani, CFP®, CMFC is with Lilani Wealth Management, located in Roseville. For more information or to contact Rashida, please call 916-782-7752 or visit lilaniwealthmanagement.com. Lilani Wealth Management is a Registered Investment Advisor. Securities offered through Foothill Securities Inc. Member FINRA/SIPC.

Save Money

If there were easy ways to save thousands of dollars each year, it’s safe to say that most of us would participate. Sure, taking major steps like refinancing your mortgage, or selling toys such as boats and pricey gadgets can substantially improve your financial picture. But perhaps more impressive are the following “hidden” ways to cut costs, which take little effort, yet result in big discounts. Note: The savings listed here are merely estimates for illustration purposes only.Utilize DiscountsLong gone is the stigma attached to coupons. These days, many local grocers offer impressive weekly discount certificates of $10 to $20 to loyal customers in an effort to stay competitive. Even Costco distributes coupon books with additional savings for members, and online coupon services let you select discounts on products that you normally buy. And don't forget to check your mailboxes for the LakeStyle Savings Guide and the Roseville Savings Guide, which offer savings at restaurants, shopping, services, salons, spas and more. And if you do not receive them at your home, you can download them for free through our Web site. By utilizing coupons at your favorite stores, you can save up to $50 a month. Those bills are no small potatoes.Potential Annual Savings: $600For more money saving ideas, be sure to pick up this month's copy of Style-Roseville Granite Bay Rocklin. Click on the "Get Your Copy" link on the bottom of this page for some of our newsstand locations. Or, to order a copy of this issue, please email Gloria Schroeder at gloria@sierrastyle.com, or call her at 916-988-9888 x116.

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