Whole Life Insurance for Retirement

Tax Act

Most people realize that some form of life insurance is almost mandatory these days. Given the costs associated with providing for any family’s needs, the death of one spouse can leave a deficit in the family budget that simply cannot be replaced without life insurance. Whole life is one of the most popular forms of permanent life insurance for precisely that reason: because it offers guaranteed benefits and cash value upon the policyholder’s death. That does not, however, mean that it is wise to just run out and buy the first prepackaged whole life policy that you encounter. There is a right way and a wrong way to buy whole life insurance.

The Wrong Way

Too many people take the simple route to purchasing whole life insurance. They select an arbitrary number – or have an insurance agent select it for them – and settle for a policy that provides that level of coverage to their heirs. This often leads to people being either over-insured or under-insured, and both present difficulties for policyholders and their families. Being over-insured may provide for larger benefits and cash payouts when you die, but such a policy also requires you t pay significantly higher premiums than you otherwise would. Being under-insured may not present you with any immediate difficulties, but it is guaranteed to leave your family without the necessary resources to maintain a consistent lifestyle when you are gone.

Doing it Right

Obviously, purchasing whole life insurance properly entails more study and research than most people assume to be necessary. The first step is to sit down and realistically determine what your family will need when you pass away. Take into account the home mortgage, college for the kids, and any other anticipated large expenses that are likely to occur in the future. Remember, your whole life insurance policy is designed to help the family maintain a certain standard of living if you die.

The next step involves making sure that you insure the most pressing needs first. You can always add to your whole life policy as time passes and new needs arise, so concentrate on those pressing needs now with the recognition that you can modify your coverage when your situation changes. Few of us have all of the resources we would like to have to protect against any possible loss, so always begin by doing what you can do now. Always remember that the best life insurance policy is the one that you can could on no matter what.

Keeping Pace with Life

Your whole life policy should be subject to your personal review on an annual basis, so that you can keep your coverage updated as your life changes. The most important thing that you can do to help you make those updates is to partner with a life insurance company and agent that you trust. Assuming that he or she is competent, the agent will be your best resource in maintaining a whole life policy that continues to meet your needs as the years and decades pass by. Best of all, you can ensure that your policy covers everything that it needs to cover, without being excessive.

Tips on Reducing Property Taxes

Tax Act

It’s bad enough when you have to pay taxes at the department store, grocery store or on your personal income, but it can be extremely frustrating having to pay taxes on a property that you own, and not only that, but having to do it each and every year. Those taxes can easily reach into the thousands of dollars or more and can put a severe strain on your personal finances. However, there may be several ways to lower the property tax amount that you are paying; ways that if aren’t taken advantage of, could cost you hundreds or even thousands of dollars each year.

If you’re looking for ways to reduce property taxes each year, here are a few tips that could gain you substantial savings.

Exemptions

Property tax exemptions may be one of the easiest and most significant ways in which to save money on your property taxes. By way of senior, homestead or homeowner, or military exemptions, you could realize extensive reductions upon your property tax bill.

In order to find out what exemptions you might be eligible for, as well as their terms and conditions, you will likely need to visit your country assessor’s office either online or in person since the ways in which exemptions are determined and applied will likely vary from state to state and even county to county. Your eligibility may also depend upon how long you’ve lived in the property for which you are applying for exemption status.

Reassessment

Depending upon when your property was last assessed and the potential change in value it has experienced since that time, it could be worth your while to request a reassessment from your assessor’s office. If you feel that your property has seen a significant decrease in value, a reassessment might substantially lower your property tax bill. However, it is important to bear in mind that a reassessment can be a double-edged sword. If an assessor finds that the value of your property has actually increased, such a move could backfire and result in higher taxes, so it is important to do your research and conduct your due diligence before requesting such a re-evaluation.

Tax Deduction

Another way to realize significant savings on your property taxes is by ensuring that you are taking advantage of your of tax deduction on your federal taxes. Since mortgage interest and property tax payments may be eligible as a deduction on federal income taxes each year, this is yet another way in which to get at least a portion of your tax money back. Similar to property tax exemptions, the amount for which you are eligible for a tax deduction for a particular tax year may depend upon how many days you have actually resided at the property. This could be an important consideration for those who have just moved into or away from a property.

Conclusion

Ways to save on property taxes and the amounts involved can range significantly depending upon your geographic location as well as your personal situation. It may therefore be important to consult your particular county assessor’s office or a tax professional to learn exactly what savings you may be eligible to receive.

Anastacio Mindiola is an accomplished attorney and business owner. His company helps home and business owners protest property taxes in Houston and the surrounding counties. For more information on how you can lower your property taxes visit http://www.republicpropertytax.com.

Cashing Out a Retirement Account

Tax Act

Cashing Out a Retirement Account

The Roth IRA is a great retirement investment vehicle along with a number of other federally available retirement plans such as traditional IRAs and SEPS. With the Roth IRA specifically, you pay taxes on the money invested prior to placing it into the account. Therefore when the money is withdrawn at retirement time, it can be done so tax free. This is the main advantage of the Roth IRA over other retirement plans. But don’t be tempted to cash out the retirement account during difficult financial times as that will result is penalties and … Read more at 2009 Taxes

Tax Act

Cashing Out a Retirement Account

The Roth IRA is a great retirement investment vehicle along with a number of other federally available retirement plans such as traditional IRAs and SEPS. With the Roth IRA specifically, you pay taxes on the money invested prior to placing it into the account. Therefore when the money is withdrawn at retirement time, it can be done so tax free. This is the main advantage of the Roth IRA over other retirement plans. But don’t be tempted to cash out the retirement account during difficult financial times as that will result is penalties and taxes that you should avoid.

Qualified distributions are the kind of retirement account distributions that you want to take. These withdrawals occur on accounts that have been open for more than six years when you turn 59 1/2 years of age. These withdrawals are penalty and tax free. Non-qualified withdrawals result in a 10% penalty on the funds cashed out along with the requirement of some income taxes. The good news is that only the investment income is taxable as you already paid taxes on the initial investment, therefore it is not taxed twice. If your account has not grown in value, all you owe is the penalty and no income taxes.

There are several hardship exemptions to the penalty and tax provisions of the law including disability, death, college expenses, medical expenses, unemployed health insurance premiums, and first time home buyers. When you fall into one of these categories you can ignore the penalties and the income taxes, withdrawal the money, and spend it specifically on the exempt item. Another exemption is a special annuity-type withdrawal where the money is cashed out equally over the life of the individual in consistent payments. Talk to a tax accountant to find out more about this special withdrawal scenario.

Roth IRA Returns: Increase your Returns this Year

Tax Act

Intelligent investment choices are the key to get a high rate of Roth IRA returns. If you will just allow your broker or your banker to pick and choose for you, your yield each year is not possible to keep up with inflation. Here’s good news! While an official Roth IRA income limit still exists, when contributions is the issue, there is absolutely no limit in terms of the amount of the income the account may earn. Aside from that, it is all free from tax!

For those people who invest in the stock market, the average Roth IRA returns is between 4 to 9% per annum. If your main goal this year is to seek that kind of exciting returns, then do your best because there are only few stocks that execute that well.

Treasury bills are considered safe investment option because they are empowered by the United States’ federal government. Nowadays, 4.17 is the percentage of the 30-year memo which is a response to individuals who pull their money out of the world’s stock market and storing it away in the so-called T-bills.

If you are still within the comfort zone of the income limit of the Roth IRA, you can also make several changes to T-bills right away. But, the earnings of your account would be very similar to what you would be able to make with a deposit certificate. Unless there there’s a drastic change, these investment options are not sufficient to cope up with inflation. Just imagine yourself earning worthless zero dollars.

Highest Rates of Returns: How to Get Them?

Those that are safely invested in real estate are self-directed IRA accounts that have the most promising returns. As a matter of fact, it is usual to earn $1,500 or more every month. If you have several accounts holding mortgages, and earning income from rent, you will have an unlimited potential in this market. See? All you need is perseverance and the art of managing your money correctly.

In order for you to have great returns this year, be wiser in handling all your investment accounts.