Although there may no way to prevent a cyber-attack from obtaining your information, there are a few things that may reduce your risk

Personal Information Cyber Attacks: What Can You Do?

What is a personal information cyber-attack?  A cyber-attack is a type of criminal activity where an individual or an organization target computer information systems, networks, or personal computer devices by various means through ‘hacking’ into the computer infrastructure.  Cyber-attacks are used to collect information that can affect an individual, or other entity such as a business, which leads to identity theft and identity fraud

Identity Theft is when personal information is taken for use by a criminal without permission.  A common theft is the use of a person’s social security number, date of birth, and even personal address.  Identity Fraud is when that information is used to make purchases, gain employment or healthcare, open or modify existing accounts.  All of these are damaging to one’s personal credit and the individual may not be aware of the fraud until being contacted by a creditor.

Although there may no way to prevent a cyber-attack from obtaining your information, there are a few things that may reduce your risk:

1.  Access your credit report and check for errors.  Under Federal Law, you’re entitled to one free credit report per year from one of the main credit reporting agencies which are Experian, Equifax, and TransUnion.  You can log onto www.freecreditreport.com, which is maintained by Experian, and select that you would like to receive your free report containing information from all three agencies.  The information you receive from all three agencies should match.  If not, you will need to file a dispute with the agency that has the incorrect information. 

2.  Close credit card accounts that you are not using.  Leaving accounts open with a zero balance is now considered a risk because of your potential to max out that available credit, or have a cyber thief do it for you.

3.  Pay for on-going credit monitoring.  Alerts are sent to you via text message, email, or you may receive a call from your credit monitoring serve when a new account is being opened, or when there is a change to your credit report.             

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Five Factors That Impact Your Retirement

Retirement can be risky business if you don’t consider all the factors that can impact your retirement during your planning process.  Although it’s hard to know what will happen in the future to you or your investments, these are the main things that should be addressed in your retirement portfolio:

#1 Longevity. If boomers live into their 90's and Gen X-ers live to a hundred, how long will you live? Medical science and healthier life styles will keep driving this number up. Depending on your retirement age, in the future, you will spend more time retired than you did working.  Medical science has impacted retirement and will continue to impact how long people may live in an assisted living facility. If the cost of better quality facilities keeps increasing, what will they cost in 2040? For this reason alone you can never have too much money for your retirement years. 

#2 Investment Horizon.  You have 30 to 40 years until you retire. One of your biggest risks is procrastination. Will you start saving when your children are older or out of college, or are your priorities the big primary residence and a vacation home? You can never get the lost years back which is why retirement planning and saving should start early.  Having the personal discipline to stick to a retirement savings plan will impact your retirement along with your time horizon. 

#3 Performance.  After you achieve critical asset mass, performance is your number one source of new assets. In fact, it may have 3-5 times the impact of savings. A critical question is who produces the performance? Do you make your own investment decisions? Do you invest in a mutual fund family?  Having a financial plan in place and working with a financial professional regularly to monitor performance will greatly impact your retirement assets lasting throughout your life.

#4 Investment Risk.  If you don't take risk when you are young, when should you? Investors in their 30's and 40's should be heavily invested in the stock market. Yes, stocks are riskier than bonds, but stocks also outperform bonds over longer time periods, just not every year. The relationship between stock, bond, and money market performance is based on Capital Market Theory. You can afford to take substantial risk if you have more time to recover from a bad year.  However, you need to be comfortable with the risk associated with your portfolio or adjustments need to be made.

#5 Investment Expense. You get what you pay for. There are no ‘free lunches’ when you invest your assets in the securities markets. And, every dollar of expense is one less dollar you have available for reinvestment and your future use. You should watch investment expenses very closely. This expense could add-up to hundreds of thousands of dollars during your life time. 

If you would like to visit to discuss all of these retirement risk factors and how they may impact you, contact our office to schedule an appointment or review.

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Retirement can be risky business if you don’t consider all the factors that can impact your retirement during your planning process.  

If you aren’t utilizing your health savings account (HSA) at your employer, you’re missing out on a great way to save for retirement health care expenses.

Health Savings Accounts Are the New Retirement Savings Account

If you aren’t utilizing your health savings account (HSA) at your employer, you’re missing out on a great way to save for retirement health care expenses. HSAs allow you to set aside money to be used to pay for medical expenses now during your working years, and later in retirement.  HSAs allow you to keep the unused money well into retirement.  No longer is HSA money ‘forfeited’ if unused at the end of the calendar year.  The only exception to HSAs is that once you enroll in Medicare, you’re unable to contribute to a health saving account.  Benefits of HSAs include:

1.  Contributions to HSAs are tax-deductible

2.  Contributions receive capital gains, dividends, and interest, which is tax-free

3.  You pay no tax on withdrawals for medical expenses

HSA qualified expenses include co-insurance, dental, vision, prescriptions, insurance plan deductibles, and other expenses not covered by your health insurance.  When you retire, HSAs can be used to cover items that are not covered by Medicare.  If you have questions about what is covered under your HSA plan, and how much you can contribute to your HSA each year, contact your HSA provider.

As you change jobs during your working years, it is possible that your employers may have different health savings account plans.  When you leave an employer the HSA funds left over are yours and can be rolled over into your new employer’s plan.  HSA funds can only be rolled over into your new employer HSA, unlike a 401(K) that can be rolled over into an individual IRA.  As you age, you don’t want to have numerous HSA accounts left at former employers, so start bringing them with you as you change jobs!

Part of financial planning involves planning for expenses in retirement and trying to determine a retirement budget.  With the rising cost of health care, putting aside extra into an HSA plan now to use later in retirement makes sense.  Currently, the cost of Medicare is deducted from beneficiary Social Security payments, and retirees still need to carry supplemental insurance for dental, vision, prescriptions, and many other things that Medicare doesn’t cover.  Start saving now in order to have money in retirement to cover these supplemental insurances you will need to pay for.

If you have any questions regarding HSA accounts or any other employer benefits such as your retirement account, feel free to contact our office for an appointment. 

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10 Tips for Millennials (and Anyone) When Selecting a Financial Professional

If you are a millennial you may feel like you have a target on your back. Local financial advisors, stockbrokers, bank representatives, CPA firms, and online firms constantly solicit you. You have a bewildering number of choices and making the wrong selection decision can undermine the achievement of your financial goals.  Millennials are considered the youngest group of investors and your potential to accumulate retirement assets is greater than someone older than you, based on your timeline for investing as well as being positioned to inherit from Baby Boomers.

Here is a top ten list to assist you when selecting a financial advisor who will influence or control your financial decisions. Always focus on the documentation of information that describes their credentials, ethics, business practices, and services. The ten most important types of information that you want documentation on are:

1. Full transparency. The advisor must be willing to provide the factual information you need to make the right decision.
2. Degrees from accredited colleges and universities. There are no minimum education requirements for financial advisors.
3. Applicable financial service experience. There are no minimum experience requirements for financial advisors.
4. Industry certifications.  Check online to validate the quality of their certifications.
5. Compliance record. Avoid advisors who have a history of client complaints. 
6. Fiduciary Status. Fiduciaries are held to the highest ethical standards in the financial service industry.
7. Method of Compensation. The appropriate to pay for financial knowledge, advice, and services is with a fee.
8. Expenses. You want full disclosure for every penny of the expense that is deducted from your accounts.
9. Ongoing services. You need ongoing financial advice and services, not a one-time sales event.
10. Performance Measurement Reports. You should request monthly or quarterly performance reports that document your results.

Discussing these ten tips should result in your advisor providing you with this information.  If you do not receive the information you request, you may want to reconsider who you choose to work with.  Our firm welcomes questions from our investors and potential investors, and believe that transparency is key to your financial success. 

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SAI October 2017 Newsletter Approval 1903143.1

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