Health Care and Your 2014 Income Tax Return

By Magdalene M. Donohoe, CPA

Starting in 2014 most individuals were required to maintain basic health insurance coverage (known as Minimum Essential Coverage) for everyone included on the individual’s income tax return, or pay a penalty. This includes the individual themselves, spouse and any dependents. The penalty, otherwise known as the Shared Responsibility Payment, applies unless you qualify for an exemption. The requirement to maintain coverage or pay a penalty is generally referred to as the “Individual Mandate.”

Here are the basics you should know:

• Minimum Essential Coverage includes the following types of coverage: an employer group health plan; individual health insurance policy; COBRA; government plans (Medicare, Medicaid, TRICARE or Children’s Health Insurance Program); or qualifi ed health plans offered by an exchange. Ohio has a Federally facilitated exchange operated by the Department of Health and Human services.

• Minimum Essential Coverage does not include workers compensation insurance, disability insurance, dental or vision benefits, long-term care benefits, and Medigap or MedSupp insurance.

• Individuals that did not have healthcare coverage must make a Shared Responsibility Payment, which for 2014 is $95 per adult and $47.50 per child under age 18 (up to $285 for a family) or 1% of combined household income, whichever is greater. The penalty increases to $325 per adult or 2% for 2015 and $695 per adult or 2.5% for 2016.

• You must make the shared responsibility payment when you file your federal income tax return. The IRS may reduce any tax refund owed to a taxpayer by the amount of Shared Responsibility Payment.

• Certain individuals are exempt from the Individual Mandate. Some examples of exempt individuals are: non-U.S. citizen; members of certain religious sects or health care sharing ministries; and members of an Indian tribe. In addition, low income taxpayers, taxpayers for whom basic coverage is unaffordable and taxpayers who qualify under a hardship exemption are not required to maintain Minimum Essential Coverage.

Furthermore, any individual who doesn’t maintain Minimum Essential Coverage for less than three consecutive months qualifies for the short coverage gap exception.

The above is a simplified explanation of the Individual Mandate. Wasacz & Skvoretz LTD can assist you in determining how this requirement will affect you and your family, call 440.239.1911 today!

CPAS advisors

Women Need to Take Charge of Their Money

Presented by Wendy A. Kouvaras, AIF ®

Many women are in charge of their financial lives, and are proudly so. Some have become their own financial captains as a result of life events; others have always steered their own ships. Even so, there are too many women who are left out of the financial decision-making – some by their own choice.

That may be a mistake. Allowing a spouse or partner to handle financial affairs may predispose a woman to a lack of money knowledge – an education deficit that may allow a couple to slip toward indebtedness one day, or prove economically crippling in the event of divorce or death.

If you aren’t in charge of your financial life, chances are you will be at some point. The National Center for Women and Retirement Research (NCWRR) at Long Island University estimates that 90% of women will eventually be solely responsible for their finances. A recent study from Financial Finesse notes that while women participate in workplace retirement plans to a greater degree than men; just 43% of women had an emergency fund and only about a quarter bothered to rebalance their portfolios with time.

The More knowledge you have, the more confident you can become.

A good first step? Talk with a female financial advisor who recognizes some of the common money myths out there, and who can counter them with realistic approaches to saving and building wealth for retirement. Don’t be afraid to “pay yourself first” and embrace some risk in investing –over time, the rewards may far exceed the degree of risk you take.

To help you take that first step, I am currently offering a free, no-obligation consultation. Don’t procrastinate contact me today.

Wendy A. Kouvaras is President of ETHIX Financial Group located at 849 White Willow Lane, Brunswick, OH 44212. She offers securities through Sigma Financial Corporation, Member FINRA/ SIPC. Advisory services offered through SPC, a registered investment advisor. ETHIX Financial Group is independent of Sigma Financial Corporation.

 

Forensic Investing – HELPING TO TAKE THE EMOTION OUT OF INVESTING

Provided By Katherine M. Carp, Financial Advisor

When we invest our hard earned, hard saved money we tend to be emotional. It may be impossible to make unbiased investment decisions when a person is overwhelmed by sentiment. I believe investing requires the use of a soulless barometer; a system that takes the emotion out of investing. Don’t take this comment as a justification for procrastination. Nothing, in my opinion, is gained by procrastinating–important fi nancial decisions need to be addressed in a timely fashion!

The right professional financial advisor could help provide clear, objective advice, bringing the focus away from emotion toward prudent guidance. Major life transitions add an inflow of emotions that can side track us from our financial goals. What constitutes a Major Life Transition? Marriage…divorce…loss of a loved one…retirement…– an emotional event in your life that brings you to a cross roads. It is my mission to help steer you towards your financial objectives.

Did you know that financial matters are the most common source of conflict among American Couples.¹ Unexpected expenses, mounting debt, problems stemming from inadequate savings, and the inability to prioritize needs versus wants are just a few of the financial issues that can put stress on a relationship. Do you know how your philosophy on saving and spending differs from that of your partner? Do you know if he or she has good or bad financial habits? Answering these questions now can help prevent stressful moments down the road, while establishing a budget will help you visualize the answers to some of these important questions.

Once a budget is implemented, it’s time to discuss and plan your financial future with a trusted financial advisor; one that can help you see passed the excitement of your marriage plans to objectively map your future finances. Where do you see yourself in 10, 20, or 30 years? Are children in your future? Do you have an emergency fund in place? Is it time to start saving for a down payment on a house? Have you already set up retirement accounts? I will take your hand and walk you through the process and help you put your investment goals in writing. You will determine your needs and establish your risk tolerance. I will provide the medium to meld your goals with forensic investing, thus eliminating subjectivity from the decision making process.

EMOTION TAKES AIM AT RETIREMENT

Today, we are faced with longer life expectancies and a continuous rise in the cost of living. One out of every four 65 year olds today will live past the age of 90.² This may create a fear of outliving retirement savings and a need to stretch retirement assets to cover a longer time frame. For some, it gives us a reason to put off planning for retirement because we don’t want to deal with the possibilities. Again, don’t use this as a reason to justify procrastination. Break through this paralyzing fear by discussing what you expect from retirement with your trusted financial advisor. Let your consultant replace your fear with serenity by prioritizing your goals, discarding notions that don’t serve you well and by utilizing all of the resources available. Now you may be able to maneuver through the investment maze and begin the process of planning for a retirement on your terms.

The emotions that well up in us as we experience major life transitions may be detrimental to the purpose behind an investment plan. Forensic investing may help strip away the emotions and looks at the facts. Do you have a source of forensic investing in the form of a trusted financial advisor? Value is one of the most critical components in selecting and maintaining a financial advisor. In other words, does the financial advisor add a competitive advantage? Do they meet your goals and objectives?

At Stifel, I begin developing a trusted relationship with my clients by creating a risk profi le for each individual to establish the critical parameters for goals, objectives, and risk tolerance. From this profile, I tailor a portfolio to conform to your unique set of circumstances.

One person cannot be the best at everything. To potentially succeed we need to build a quality team that includes you, me, and Stifel. You have an integral role to play in this team. Together, we have the power to plan and prepare a durable investment strategy.

Katherine Carp is a Financial Advisor with Stifel, Nicolaus & Company, Incorporated,
member SIPC and New York Stock Exchange, and can be contacted in
the Westlake, Ohio office at (440) 250-1630.

1 Per a survey from the American Institute of CPA’s
2 Per the Social Security Administration

Recipe for Retirement

Ingredients:
1 part Objectives
1 part Risk Tolerance
1 part Asset Allocation
Annual IRA Contributions
Annual Savings Goal

Directions: Whisk together Annual IRA Contributions and Annual Savings goal and set aside for later. Mix together Objectives, Risk Tolerance, and Asset Allocation unti l well blended. Slowly add Contributions and Savings at regular intervals. Set timer for Retirement age.
Serves: Retirement on your terms may include: Days spent with grandchildren, relaxing at home with a good book, sunset walks on the beach, a trip to Rome, Italy.

Saving for retirement is not quite as easy as a simple recipe. The ingredients listed above will need to be collected. Your input is used to determine your objectives and risk tolerance. The Asset Allocation is then built upon the foundation of your wants and needs. As you can imagine, those objectives and risks can change over time, and your investment plan will need to be adapted to those changes. The most important thing is to start the process.

Collect the Ingredients. First assess your financial situation. Start by making a list of your financial goals, this will help define your objectives. For instance, you may have a goal to pay off your mortgage before you retire or maybe your goal is to retire at a younger age. Write all your goals down even the ones that may seem to stretch outside your limits. Next, list your resources; your household income, other sources of income. Think outside the box here as well, your accountant and financial advisor are a resource to you. Also list your savings. This may be in many forms, from a 401(k) account, Individual Retirement Account (IRA), investment accounts, or life insurance. The last step in assessing your situation is to consider your tolerance for risk. All of this information will give you a better understanding of what the next move should be.

Build an Asset Allocation Mix. After reviewing your current situation, enlist the guidance of a financial advisor to develop an asset allocation strategy that is specific to your wants and needs. Asset allocation is the process of deciding what percentage of your money to place into the three major asset classes: stocks, bonds, and cash. While asset allocation does not ensure a profit or protect against loss, with asset allocation, your portfolio may experience less fluctuation in value than individual assets within the portfolio.

When you buy a stock, the shares of stock represent ownership in that specific company. The different-sized corporations are classified into categories of large capitalization, mid-capitalization, and small capitalization. Within these classifications, the stocks can be further identified by style, either growth or value.

When you buy a bond, you are lending the principal amount to the issuer who pays you back both interest and principal. Some of the major types of bonds include U.S. Treasury bonds, corporate bonds, and municipal bonds.

Adapt your Recipe. It is important to evaluate the progress of your plan in order to help ensure you are on the right path, because changes in lifestyle, financial goals, and time frame can all have an impact on your investment plan. When planning and preparing for my own retirement, I hit a bump in the road. I was diagnosed with Breast Cancer in 2011. Even though I’m now cancer free, this event radically changed my objectives for retirement and for the present. Previously, I wanted a comfortable retirement with the luxury of traveling to interesting places. Currently, I feel the need to make sure that I have good health insurance in my retirement and I no longer want to put off exploring the world. My timeline for travel has accelerated. I experienced a life changing event and have adjusted my financial goals accordingly.

My recipe for retirement is a starting point. One that begins with a self-examination of the goals that are important to you. I believe the key to retirement is preparation and utilization of the resources available to you. When building a relationship with a financial advisor, you will gain insight on defi ning your objectives and risk tolerance. A trusted advisor will help you build an allocation mix and adapt it to life changes. Join me in preparing for retirement.

Katherine Carp is a Financial Advisor with Stifel, Nicolaus & Company, Incorporated, member SIPC and New York Stock Exchange, and can be contacted in the Westlake, Ohio office at (440) 250-1630.

Article Provided By Katherine M. Carp, Financial Advisor. Katie began her investment industry career 14 years ago after graduating from The Ohio State University with a bachelor of science in mathematics. Following her graduation, she accepted a position in the municipal bond department of an Ohio-based investment ‚ rm. Since then, she has established a strong command of the intricacies involved in this industry. Katie joined the Stifel team in 2009 and shares her team’s commitment to providing outstanding client service. In her free time, she is an active supporter of the American Cancer Society.

A Financial ✓Checklist You Can Handle

Presented by Jonathan S. Merckens, CFP®

With the beginning of 2014 upon us, you may have set goals and resolutions for the New Year. This financial checklist will help in attaining that commitment to improve your financial health. For many people, checking off items on a long list of to-dos brings a great sense of satisfaction as well as accomplishment. To help you keep moving toward your goals, we’ve created a month-by-month checklist of some key financial tasks to consider throughout the year.

January
• Establish a will or trust with an estate attorney. Although many people avoid thinking about estate planning, getting your affairs in order is one of the greatest gifts you can give your loved ones. If you’ve already established a will or a trust, sit down and review the documents with your attorney, making any necessary changes.
•  Create a budget. Establishing a monthly plan for spending and saving is an excellent way to help keep your fi nances in check, whether you’re reevaluating your financial life or just trying to maintain good habits.
• Get ahead on your mortgage. If you can swing it, consider making a full extra payment toward your mortgage principal, which may help shorten the length of your loan.

February
• Review life, home, and auto insurance. It’s a good idea to check your coverage regularly. Have you experienced a major life event in the past year, such as a marriage or birth? Any significant changes in your personal life may require you to reevaluate your coverage.
• Revisit beneficiary designations for life insurance/retirement accounts. Do you need to add a new beneficiary or change a designation? Review your accounts to ensure that the correct people are listed.

March
• Check your investment portfolio allocations and current holdings. As your financial advisor, we monitor your investment portfolio and holdings regularly. Nonetheless, you should be aware of where and how your assets are invested.
• Explore loans, grants, and other sources of financial aid. There are many ways to finance college and postgraduate education expenses. If you have a college-bound child, it’s wise to get an early start researching the options available to you. The government-sponsored website www.studentaid.ed.gov is a great place to begin.

April
• Review your online social security statement. Check your benefits information and earning record, and update any outdated personal information, such as your address or phone number.

May
• Review 401(k), IRA, and SEP plans. No matter your retirement goals, keeping an eye on your balances and making regular contributions is essential. Depending on your circumstances, consider increasing the amount you contribute. (Retirement planning is equally important for self-employed individuals, who can take advantage of many of the same savings vehicles.) We encourage you to meet with us to discuss the investment allocations in your 401(k) or other plan.

June
• Check your credit report. Request your free credit report at www.annualcreditreport.com and review it carefully for mistakes or suspicious charges, which could be a sign of identity theft.
• Shred old documents. Any financial documents that you no longer need, such as bank and investment statements, should be destroyed to ensure that they don’t fall into the wrong hands.

July
• Research 529 savings plans. Withdrawals from 529 plans are tax-free when used for qualified higher education expenses, making them an excellent way to save for a child or grandchild’s schooling.

August
• Review online accounts. Take a look at the usernames and passwords you currently use for your online accounts. If the passwords are too basic or if you’ve held onto them for too long, consider changing them as a security precaution.

September
•  Assess your overall investment goals and strategy. It’s wise to reevaluate your financial goals every year, especially if you’ve had any major changes or unexpected events in your
life. We can discuss your situation and help you adjust your financial plan accordingly.
• Revisit your budget. Look back at the plan you made in January and decide whether to adjust your budget or stick to your current strategy.

October
• Contact your CPA for year-end tax planning. Before tax season hits, it’s a good idea to speak with a certified accountant about changes in your personal circumstances, expiring tax breaks, and so on.
• Consider charitable giving. Donating to charity at year-end is a popular way to do good while reaping potential tax deductions. Charitable giving may be another item you wish to discuss with your CPA.

November
• Review the balance in your flexible spending account (FSA). FSAs require special attention so that you don’t lose unused funds at year-end. Under a new law, employers may allow employees to roll over $500 in FSA funds to the next year. Be sure to check the rules of your FSA plan and review your available balance.

December
• Consider refinancing high-interest debt. Consolidating your mortgage, credit card, or car loan payments can make your financial life more efficient (and possibly lower your overall interest rate).
• Pay off credit card balances every month. For the New Year, make a resolution to pay off your credit card balances every month, if you’re not doing so already.

Milestone events
In addition to the monthly tasks outlined here, keep these significant planning
milestones in mind as you near retirement age:
• Age 50: Consider making catch-up contributions to IRAs and qualified retirement plans.
• Age 55: You can take distributions from 401(k) plans without penalty if retired.
• Age 59½: You can take distributions from IRAs without penalty.
• Ages 62–70: You can apply for social security benefi ts.
• Age 65: You become eligible for Medicare.
• Age 70½: You must begin taking required minimum distributions from IRAs, 401(k)s, and 403(b)s.

Although this may seem like a lot of information to take in at once, glancing at the checklist each month and being ready for important retirement-related dates can greatly improve your sense of financial security, granting you peace of mind in 2014—and beyond.

This material has been provided for general informational purposes only and does not constitute either tax or legal advice. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a tax preparer, professional tax advisor, or lawyer.

Jonathan S. Merckens is a financial planner practicing at 11925 Pearl Road, Suite #403 Strongsville, OH 44136. He o­ ers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser.

Contact Jonathan at (440) 638-4757 or Jonathan@GrahamAssoc.com

© 2013 Commonwealth Financial Network®

Path to a Sustainable and Enjoyable Retirement

Presented by Jonathan S Merckens, CFP ®

Most working Americans have only one source of steady income before they retire: their jobs. When you retire, however, your income will likely come from a number of sources, such as retirement accounts, social security benefits, pensions, and part-time work. When deciding how to manage your various assets to ensure a steady retirement income stream, there are two main strategies to consider: the total return approach and the investment pool—or bucket—approach.

The Total Return Approach

With the total return approach, you invest your assets in a diversified portfolio of investments with varying potential for growth, stability, and liquidity. The percentage you allot to each type of investment depends on your asset allocation plan, time horizon, risk tolerance, need for income, and other goals.

The objective of your investment portfolio generally changes over time, depending on how close you are to retirement:

  • Accumulation phase. During the accumulation phase, your portfolio’s objective is   to increase in value as much as possible, with a focus on investments with growth potential.
  • Approaching retirement-age phase. As you near retirement, your portfolio becomes more conservative, moving toward more stable and liquid assets in order to help preserve your earnings.
  • Retirement phase. Once you retire, the idea is to withdraw from your portfolio at an even rate that allows you to enjoy a sustainable lifestyle.

Traditionally, a widely quoted withdrawal rate for the first year of retirement has been 4 percent. Ideally, that 4 percent should be equal to the amount left over after you subtract your yearly retirement income (e.g., pensions, social security, and so on) from your total cost of living, including investment management fees. Each year, you will most likely increase your withdrawal percentage to keep up with inflation. Keep in mind, however, that the appropriate withdrawal rate for you will depend on your personal situation as well as the current economic environment.

The Bucket Approach

The bucket approach also begins with a diversified portfolio, following the total return approach throughout most of the accumulation period. Then, as retirement approaches, you divide your assets into several smaller portfolios (or buckets), each with different time horizons, to target specific needs. There is no “right” number of buckets, but three is fairly common. In a three-bucket scenario:

  • The first bucket would cover the three years leading up to retirement and the two years following retirement, providing income for near-term spending. It would likely include investments that have historically been relatively stable, such as short-term bonds, CDs, money market funds, and cash.
  • The second bucket would be used in years three through nine of retirement. Designed to preserve some capital while generating retirement income, it would include more assets with growth potential, such as certain mutual funds and dividend-paying stocks.
  • The third bucket, designated to provide income in year 10 and beyond, would contain investments that have the most potential for growth, such as equities, commodities, real estate, and alternatives. Although the risk profile of this bucket is typically higher than the other two, its long time horizon can help provide a buffer for short-term volatility.

As you enter the distribution phase, you draw from these buckets sequentially, using a withdrawal rate based on your specific lifestyle goals in a particular year.

The Big Picture

Many people are familiar with the total return approach, but the bucket approach has been gaining popularity recently, thanks in large part to its simplicity. It also accounts for different time periods during retirement, potentially allowing you to allocate money more effectively based on your personal situation.

Perhaps the greatest benefit of the bucket approach is that it can help provide a buffer during times of market volatility. For example, if the value of the investments in buckets two and three suddenly fluctuates due to market conditions, your immediate cash income is coming from bucket one, which is likely to be less volatile. This may also alleviate the need to sell investments that have lost money in order to generate retirement income.

Of course, while the bucket approach has its advantages, some investors simply feel more comfortable using the total return approach. Remember, the best strategy for your retirement is unique to you and your personal preferences and needs. However you choose to pursue your retirement dreams, it’s important to work with a financial professional who can help you create the most appropriate strategy based on your goals and situation.

Contact us today to learn more about the different paths you may take to pursue a sustainable and enjoyable retirement.

Jonathan@GrahamAssoc.com

Encore Careers: Becoming Your Own Boss

Presented by Jonathan S. Merckens, CFP

When we think of today’s entrepreneurs, young technology developers like Mark Zuckerberg, creator of Facebook, or Sergey Brin and Larry Page, founders of Google, often come to mind. But while fresh-faced tech innovators may dominate the headlines, another crop of businesspeople is proving that it’s never too late to forge an entrepreneurial path.

Over the past decade, Americans ages 55–64 have been at the head of the startup pack, launching more businesses than any other demographic. Armed with knowledge, skills, and professional networks cultivated in their previous careers, this new wave of baby boomer entrepreneurs is showing that they have what it takes to launch successful businesses later in life.

Why the business boom among older Americans?For many older entrepreneurs, retirement offers an opportunity to pursue lifelong passions and interests. After working in more structured environments for years, some boomers are attracted to the flexible lifestyle and supplemental income that running their own businesses can provide. And some are going into business for themselves out of necessity, having been laid off or fearing for their future prospects.

Of course, entrepreneurship has both its benefits and potential pitfalls. According to the U.S. Small Business Administration, half of new businesses fail within the first five years. The good news for older entrepreneurs is that they’re often better equipped than their younger counterparts to withstand the stress and hardships of business ownership. On the other hand, since they tend to have higher living expenses, greater family obligations, and less time to recover from failure, older entrepreneurs may also face greater risks.

Is entrepreneurship for you?
If you or someone you know is thinking about embarking on an encore career as an entrepreneur, it’s important to weigh every aspect of the decision. As you evaluate this major life change, here are a few tips to keep in mind:

  • Maximize your skills. Starting a business in your area of expertise will allow you to capitalize on your existing network and experience, increasing your chances of success.
  • Do what you love. Business ownership is hard work, so it’s essential to be excited about the product or service you plan to offer. If you’re 100-percent passionate about your business, you’ll be better able to deal with obstacles and remain energized when the going gets tough.
  • Conduct a self-assessment. Before moving forward with your business idea, be sure to gauge your risk tolerance. Looking back on your career, were you a risk taker? Do you consider yourself competitive and enjoy making decisions? Do you have the same drive that you did when you first started working? Be honest with yourself about how much risk you’re willing to take on and your level of motivation.
  • Test the waters. Worried about launching a business and then realizing it was a bad decision? Before investing money or leaving another job, try out the idea in your spare time. For example, if you want to open a restaurant, take a part-time job in a café to see if you like it as much as you think. If you’re diving into an industry in which you don’t have much experience, learn all you can by attending conferences and training sessions. Finding a mentor can also help you determine whether you’re cut out for business ownership.
  • Select the right business model. Franchises, sole proprietorships, and home-based or online businesses are often a great fit for older entrepreneurs because they’re less expensive to start and offer more flexibility.
  • Take advantage of your resources. It’s wise to work with your financial planner to estimate startup costs, tax changes, and how business ownership will affect your overall financial situation. For loan assistance, consider the following resources:
    • The U.S. Small Business Administration, www.sba.gov, helps facilitate loans with third-party lenders.
    • Biz2Credit.com, BoeFly.com, and Lendio.com pair small businesses with banks and credit unions that will lend to startup companies.

Pursuing a new business venture later in life can be risky, but it also presents the opportunity for great personal and financial reward. No matter your age, careful planning and the advice of a knowledgeable financial advisor can help pave the way to small business success.

Call Jonathan today for a business or retirement consultation. 440.638.4757

Jonathan S Merckens is a financial planner practicing at 11925 Pearl Rd., Ste. 403, Strongsville, OH 44136. He offers securities and advisory services as a registered representative and investment adviser representative of Commonwealth Financial Network, a remember firm of FINRA/SIPC and Registered Investment Adviser.

Contact him at (440)638.4757 or Jonathan@GrahamAssoc.com

Why Should You Exercise?

By Joshua Trentine,
OVERLOAD Fitness

Before we can answer that question, we must first define exercise. Why define? In the words of grammarian Richard Mitchell: a word that means everything means nothing. Exercise has come to mean everything; I’ve heard walking, gardening, dancing, video games, sex, and a wide range of activities called “exercise.”

Exercise is a process whereby the body performs work of a demanding nature, in accordance with muscle and joint function, in a distraction-free, temperature controlled environment, within the constraints of safety, meaningfully loading the muscular structures to inroad their strength in a minimum amount of time.

This should narrow things down a bit. The most common thing I hear from people is that they claim that all of their recreational endeavors are exercise. I’m here to say if it does not meet specific criteria that allows for enough of a stimulus to excite the body to produce profound architectural changes, then you are left with activity and recreation, not exercise. I’m not suggesting that recreation and activity are without benefit. These things are absolutely essential to us and we should be able to enjoy recreational activity for the rest of
our days on earth, as long as we participate in normal and required maintenance for the human body called EXERCISE!

The most common gripe I get when restricting the word “exercise” is that people will complain that they must do activity very often to burn calories. While I admit activity can be calorie wasting it can also be sarcopenic (muscle wasting). Some estimates have an entire marathon only costing us 2,500 calories and there are 3,500 calories stored in just one pound of fat; if you’re not logging your calories and creating some kind of calorie defi cit, good luck losing any fat. Now this gets me to my answer of “why exercise”: to preserve and increase lean tissue. Bottom line, if you’re much past 25 years old, you are losing muscle every year; and if you’re much past 40 years old, it’s happening quickly. Fat loss can only occur if there is a calorie deficit, and recreational activity is a very inefficient means to creating this deficit. Diet is the primary mode for fat loss and exercise is a means of preserving lean tissue as we age and to make sure that our weight loss efforts are discriminate. In other words, we’re not really out to lose weight. We wish to lose fat and preserve lean muscle mass. This is done with diet and exercise. Exercise, as defined above, will promote skeletal muscle gain and prevention of loss. Skeletal muscle is the window to the body and will enhance: strength, HDL, bone density, vascular efficiency, metabolic efficiency (for type II Diabetics including glucose economy and insulin sensitivity), joint stability and protection, stamina, mobility, and overall functional ability to allow you to do anything.

If you’re after the most intense, safe, efficient, effective, results producing exercise, please come in for a free 90 minute consult at OVERLOAD FITNESS.

Contact info@overloadfitness.com or visit overloadfitness.com.

 

Preparing for the Return of a Boomerang Kid

Presented by Jonathan S Merckens, CFP

It probably feels like yesterday that you dropped your child off at college for his or her freshman year. Saying goodbye in a dorm room, surrounded by new bedding, electronics, and all the food that could fit in the mini-fridge, you may have shed tears knowing that your
almost-adult child would no longer be living under your roof.

Fast-forward to graduation, and your son or daughter may be contemplating his or her next step. Graduate school? Job search? Travel? Unfortunately, high debt rates and an unpredictable economy have limited grads’ options, and many are returning home after graduation. According to a recent study conducted by the Pew Research Center, 3 in 10 young adults between the ages of 25 and 34 have lived with their parents in recent years.

Meet the boomerang generation
Known as the “boomerang generation,” young adults today are apt to move out of the family home for a period of time before returning to live with their parents. Grown children may need or want to move back in with mom and dad for any number of reasons, including:
• Lack of money to fi nd a place on their own after college
• Job loss
• Desire to pay off debt or save money to make a down payment on a house
• A failed relationship or unsustainable living arrangement with a roommate
• Desire for security and stability

As more adult children move back home, families must get used to living under one roof again. Having a plan to manage the transition is essential, as it helps set expectations and ensures that both parents and grown children stay on course to meet their fi nancial goals.

Keeping your financial life on track with a full house
If your grown child is moving back home, the following tips can help you manage the financial aspects of your relationship:
• Be realistic. It’s natural to want to support your child as he or she searches for employment or saves money. But don’t exceed your financial limits. Your child should understand that it’s important for you to meet your own retirement and debt repayment goals and obligations.
• Map out a financial plan for your child. Help your child build better financial habits by working together to set a budget and savings goal. Discuss the amount of financial help you’re able to provide without jeopardizing your own savings. Also decide if your child will stay on your health insurance plan (most plans cover kids up to age 26).
• Set a target move-out date. Along with creating a financial plan, setting a move-out deadline will encourage your child to work toward concrete goals. If you don’t set a limit, he or she may stay at home longer than expected or delay working toward future plans. If your child needs to start paying off credit card bills or tuition debt, or is hoping to save money for a down payment on a house or condo, have a realistic discussion about how long it will take. To help everyone stay on track, some parents draw up a contract that both they and the child sign.
• Reassess the plan as necessary. Once you’ve made a financial plan and set a move-out date, ensure that your child is making progress toward those goals. Talk regularly about obstacles he or she has encountered and how you may be able to help with the job search. If your child hasn’t been able to fi nd a job, you may need to update the plan to reflect a more realistic time frame.
• Decide if your child will pay rent. Charging rent can help offset the costs of having another person under your roof. If you don’t need rent money to cover your bills, you might consider letting your child save that amount to use when he or she moves out. If your child doesn’t have a job or can’t afford to pay rent, exchanging work for room and board is an option. Your child’s duties might include shoveling snow, mowing the lawn, painting a room, or cooking a meal once a week.
• Consider your child’s debt. Parents are often conflicted about whether to help their children pay off credit card or education debt. If you do decide to help, create a contract that outlines what you expect in return. You could also waive rent for a couple of months if your child agrees to put any savings toward decreasing his or her debt burden.

Making the best of a not-so-ideal situation
Dealing with a full house again can be tricky, especially if you’ve lived in an empty nest for an extended period of time. But, by setting clear ground rules and fi nancial expectations, you can ensure a much smoother transition when a grown child returns home— and help him or her regain financial independence more quickly.

Jonathan S Merckens is a  nancial planner practicing at 1287 Ridge Rd, Ste. B, Hinckley, OH 44233. He o ers securities and advisory services as a registered representative and investment adviser representative of Commonwealth Financial Network®, a member firm of FINRA/SIPC and Registered Investment Adviser. Contact him at (330) 591-9311 or Jonathan@GrahamAssoc.com