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CLIENT ALERT

February 3, 2014

Financial Checkup for February 2014

Top Ten Items
As you pull together your tax information for the preparation of your 2013 income tax returns, keep these things in mind:

  1. Review Your Estate Planning Documents:  Are they in step with changes in the law and do they say what you want them to say?  Do your heirs know what is there and what will happen if something happens to you?

  2. 529 Plans:  Are you planning for college for your children?  It is never too early to start and if you don’t start early it’s often too late when you do.

  3. Review the Performance of Your Portfolio:  With the large uptick in stock indices in 2013, two things should be done:  Rebalance your portfolio, bring it back into line with your preferred asset allocation, and evaluate your investment advisor’s return against their peers.

  4. Life Insurance:  Do you need it and if you have existing policies, do they fit your current needs?  Remember, older policies can often be replaced with newer, less expensive policies as insurance costs go down in response to lower mortality rates.

  5. Budgeting:  Often times this painful exercise tells you important things about your spending habits and allows you to save money and reach your financial goals more quickly.

  6. Retirement Planning:  Are you doing it?  Remember, the earlier you start the faster you can achieve your goals.  As baby boomers reach retirement age, the statistics show that an overwhelming number of them have little or nothing saved for retirement.  Enrolling in your company 401(k), even at a very low percentage, is a must.

  7. Student Loans and Credit Card Debt:  If you have either, they should be at the top of your bucket list to begin to pay off.

  8. Health Insurance, Disability Insurance and Long Term Care:  With the Health Care Act offering a new option, health insurance should be revisited.  Disability and long-term care are something that everyone should at least consider.

  9. Your Mortgage:  How long does it have left?  What is your rate and do you have a balloon payment coming up?  The window on possible refinancing is closing and will further close if and when interest rates begin to go up.

  10. Increased Income Tax Rates:  How best should you be navigating to minimize the effect of the increased personal rates and 3.8% tax on dividends, interest, capital gains and other investment income?

Please contact your ORBA representative or Steve Lewis at slewis@orba.com to discuss these financial issues and any others that come up as you go through the tax preparation process.

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