Senior Tax Advisory Group

Todays economic conditions are much worse than coming out of the Great Depression. During that periods economic recovery, the U.S. experienced historical debt and tax levels, paid for by the American people when tax rates were above 40% for over 40 years (1940-1981). Many older Americans recall the high-interest rates, high prices, and people displacing from the weak economy. While the CARES Act provided a one-time payment to individuals and for business stimulus, it will not solve our countrys future economic problems. Government-funded recovery will likely lead to higher taxes, and the debt will be collected from U.S. taxpayers to decrease the Federal deficit.What has changed since The Great Depression is the debt the U.S. carries, now close to $28.7 Trillion with a 107% Debt/GDP Ratio (Gross Domestic Product). Our debt to GDP ratio indicates that the U.S. owes more than it produces and consumes domestically, or exports. How do economies recover? By producing and selling more than its expenditures or by raising the prices of their products. How do government coffers improve? Through tax collection. Both create problems for everyone, but especially for those nearing or in retirement. In any market, investors must always consider the five risks that can sideline their financial future:Inflation Risk- Investments not optimally positioned to address the rising costs of goods and services will deplete a portfolio.Taxes Risk- Increased taxes erode the investment capital; the investment type and timing are critical.Longevity Risk- Investment capital is not enough for supporting longer lives and long-term care needs.Survivorship Risk- Unexpected loss of a life-partner leading to lower investment capital.Market Risk- Loss of principal value can decrease investment capital.The impact of inflation and taxes due to COVID-19 will continue making it critical that you consider your retirement portfolios allocation and prepare for your financial future.Editors Note: This article was submitted by Darian Andreson, of Senior Tax Advisory Group and may be reached at 719-596-4844 or by email at Info@SpringsTax.com

Getting ready for retirement can be exciting. With such a huge lifestyle change, you should consider starting to lay the groundwork now. Here are some tips to help you through that transition.Create a realistic budget.When planning your retirement budget, remember that some expenses may decline in retirement, but your medical expenses will most likely go up as you age. Plus, be sure to include any long-term care expenses.Set a firm retirement date.You probably have an idea of when youd like to retire, now could be a good time to set that date in stone. This is also a good time to talk to a Retirement Planning Specialist to help determine when you should claim Social Security to maximize your benefits and factor that into your planned retirement date. Determine your retirement lifestyle.In-depth research is a must no matter where you plan to live in retirement whether its in another country or a nearby assisted-living community. Aside from obvious factors like the weather, you should also consider factors like state and local taxes, the local real estate market, proximity to friends and family, access to the kinds of activities you enjoy, and access to high-quality healthcare. If possible, take some of your saved vacation time and spend a couple of weeks living as you plan to in retirement. Review your portfolio.Soon youll be switching over from putting money into your retirement accounts to taking money out. If you havent already done so, you should rebalance your investments in preparation for retirement. For example, you may want to reduce the amount of risk. You may want to look at more income producing investments such as fixed indexed annuities, or income producing bonds. The number 1 concern in retirement is running out of money. This is also a good time to take your account statements to a financial professional who has experience in retirement planning and ask for guidance.To learn more about Senior Tax Advisory Group call them at 719-596-4844. 

Consider conducting a final tax planning review now to see if you can still take actions to minimize your taxes this year. Here are some ideas to get you started.Review your income. Begin by determining how your income this year will compare to last year. Since tax rates are the same, this is a good initial indicator of your potential tax obligation. However, if your income is rising, more of your income could be subject to a higher tax rate. This higher income could also trigger phaseouts that will prevent you from taking advantage of certain deductions or tax credits formerly available to you.Examine life changes. Review any key events over the past year that may have potential tax implications. Here are some common examples:Purchasing or selling a homeRefinancing or adding a new mortgageGetting married or divorcedIncurring large medical expensesChanging jobsWelcoming a babyIdentify what tax changes may impact you. Some of the major changes this year include the lowering of the child tax credit and the lowering of dependent care credit for working couples. This year also marks the first year in the last two with no pandemic related payments. If you think this could impact your situation it may make sense to conduct a tax planning review.Manage your retirement. One of the best ways to reduce your taxable income is to use tax beneficial retirement programs. So now is a good time to review your retirement account funding options. If you are not taking full advantage of the accounts available to you, there is still time to make adjustments.Look into credits. There are a variety of tax credits available to most taxpayers. Spend some time reviewing the most common ones to ensure your tax plan takes advantage of them. Here are some worth reviewing:Child Tax CreditEarned Income Tax CreditPremium Tax CreditAdoption CreditElderly and Disabled CreditEducational Credits (Lifetime Learning Credit and American Opportunity Tax Credit)Avoid surprises. Your goal right now is to try and avoid any unwanted surprises when you file your tax return. It's also better to identify the need for a review now versus at the end of the year when time is running out. And remember, you are not required to be a tax expert. Use the tips here to determine if a review of your situation is warranted.

The vast amount of information shared online during tax season makes it a haven for identity thieves, and they're doing everything they can to take advantage of the opportunity! Here are several ways that identity thieves are targeting you, common signs of ID theft and steps to take if you become a victim.How Identity Thieves Target YouImpersonating the IRS. Thieves calling you and claiming to be the IRS will try and intimidate you into making an immediate payment using a gift card or wire service. Remember, the IRS will physically mail you a letter as a means of first contact. And the IRS will never call you to demand an immediate payment.Filing a fraudulent tax return. Identity thieves often try to file a tax return using your Social Security number before you do. So consider filing your tax return as quickly as you can to beat identity thieves at their own game.Phishing schemes. Be on the lookout for unsolicited emails, texts and social media posts that prompt you to share personal and financial information. These messages could also contain viruses, spyware or other malware that could infect your electronic devices.Common Signs Of ID TheftHere are some of the common signs of identity theft according to the IRS:In early 2023, you receive a refund before filing your 2022 tax return.You receive a tax transcript you didnt request from the IRS.A notice that someone created an IRS online account without your consent.You find out that more than one tax return was filed using your Social Security number.You receive tax documents from an employer you do not know.Other signs of identity theft include:Unexplained withdrawals on bank statements.Mysterious credit card charges.Your credit report shows accounts you didnt open.You are billed for services you didnt use or receive calls about phantom debts.What You Can DoIf you discover that youre a victim of identity theft, consider taking the following action:Notify creditors and banks. Most credit card companies offer protections to cardholders affected by ID theft. You can generally avoid liability for unauthorized charges exceeding $50. But if your ATM or debit card is stolen, report the theft immediately to avoid dire consequences.Place a fraud alert on your credit report. To avoid long-lasting impact, contact any one of the three major credit reporting agenciesEquifax, Experian or TransUnionto request a fraud alert. This alert covers all three of your credit files.Report the theft to the Federal Trade Commission (FTC). Visit identitytheft.gov or call 877-438-4338. The FTC will provide a recovery plan and offer updates if you set up an account on the website.Please call if you suspect any tax-related identity theft. If any of the previously mentioned signs of tax-related identity theft have happened to you, please call to schedule an appointment to discuss next steps.Article Submitted by Senior Tax Advisory Group. Call them with any questions at 719-596-4844

Many people decide to semi-retire early and start taking their Social Security benefit at the earliest age possible. Its appealing to be able to work part-time or where you have an interest or start a small business while making an income and receive Social Security retirement benefits. While early retirement and a part-time job may be of interest to you, it can affect your Social Security Retirement benefits if you arent full retirement age.Theres a lot of confusion about the impact of working. You can still collect Social Security benefits, but if you earn above a certain amount, your monthly benefit will reduce. Here are a few things to know:If you are drawing benefits and you are younger than your full retirement age or FRA (67 for those born after 1959), your benefit will be reduced by $1 for every $2 in earned income over $18,240 in 2020.This reduces $1 for every $3 in earned income over $48,600 in the year in which you reach your FRA, but only for the months before you reach your FRA.Once you reach your FRA, there will be no reduction in benefits, no matter how much earned income that you have.Earned income is defined as income from work or self-employment and includes such things as your salary, any bonus, or your net self-employment income.Any benefits that reduce due to too much earned income are not truly lost, and they will be added to your benefit once you reach your FRA.Drawing your Social Security Retirement benefits early will impact your retirement, and your benefit could be subject to taxes if your combined income exceeds certain thresholds. Talk to an expert before you start taking your benefit.Editors Note: This article was submitted by Darian Andreson, of Senior Tax Advisory Group and may be reached at 719-596-4844 or by email at Info@SpringsTax.com

Many people refer to their retirement savings as a nest egg, but in theory, it should be made up of many sources of retirement income - many eggs. Even if Social Security and a company retirement plan were their only retirement savings sources, likely they havent thought about their withdrawal strategy. Its not as simple as just drawing down retirement income from one or two sources without a plan. Have the following been considered?Taxable vs. Tax-Free incomeHow much of their money is available to spend in retirement?Will money need to be put aside to pay taxes?Are there other income streams?Would investment advice produce better returns, even in retirement?Is there a withdrawal strategy that will be better for me than liquidating only from one or two sources?When considering these, having only one or two eggs doesnt seem like enough. As Americans, we have many options to save for retirement:Tax-Sheltered retirement plansTax-Free retirement plansEmployer or Government employer-funded pension plansCompany profit sharing retirement plansInsurance Products: Fixed-indexed annuities, Whole Life InsuranceCertificates of DepositSocial SecurityAll these types of retirement savings options have different rules on taxation and when they can withdraw without penalty. Delaying Social Security, while taking withdrawals from other taxable retirement income sources, can greatly impact income. For this reason, a retirement portfolio must be adjusted and monitored, and a plan developed for withdrawing from each income source, and its taxation consequences. These make financial planning throughout retirement even more critical.If you have multiple or only a few retirement nest eggs, now is an excellent time to discuss how taxes will impact you this year or in the future.Editors Note: This article was submitted by Darian Andreson, of Senior Tax Advisory Group and may be reached at 719-596-4844 or by email at Info@SpringsTax.com

To learn more about Senior Tax Advisory Group, CLICK HERE.In the quest to create wealth, many savers have struggled with how to buy low and sell high and have even found themselves doing just the opposite. If the expression -- if it aint broke don't fix it makes sense then what should you do if your financial plan is broke? Or how about the oft quoted definition for insanity being doing the same thing and expecting different results. Well, if you've had about all the risk and fluctuation you can handle there may be a great alternative for you. In the early to late 1990s, people flooded out of the safe haven of various fixed products to get in on market-oriented products with the hope of capturing high returns. As the market began to move down and eventually crash, many people were told to hold on and be patient. When they did, it took most of them the next five to six years to recover their losses. Then, just as many investments were starting to break even, the current economic recession began, leaving people to wonder how long it will take, yet again to break even let alone grow.When you no longer have time to hold on or the chance of recovering your balance is even less realistic, then the time is now for a different strategy!Fixed annuities can be that wonderful solution for safety and security. They provide unique features such as income planning for now and later. They can also be a great tool for recovery of some of your losses, while allowing you to enjoy some upside potential with no downside risk. Simply put, once you make it you keep it, and you never risk losing it again.There is a lot of media misinformation about this secure financial solution, so it is very important that you get educated by an advisor that you can trust to understand to see if a fixed annuity might be suitable for you. Solid information and innovative solutions help you make informed decisions and the sooner you start gathering the facts for your individual circumstances the better.Editors Note: This article was submitted by Senior Tax advisory Group, Inc. For help, or further information, they can be reached at 719-596-4844

Deciding whether to put more money into an aging car or to replace it with a new or used vehicle is rarely a simple decision. Plus, skyrocketing vehicle prices and economic uncertainty are making the decision process even tougher.Signs It Is Time To Replace Your CarTo help you decide if it is time to replace your vehicle, look for these signs:The kids would rather walk miles to their friends house than ride in the car.Your oil bill is higher than your gas bill.The mechanic names a repair bay after you.Your employer politely asks you to park next door.The sound of the engine causes tornado sirens to blare.If none of these apply to you, congratulations! Your car might still be street legal, but there are other things to consider. All joking aside, making the final call can be difficult. Heres a few helpful ideas:Making An Informed DecisionDetermine your risk threshold. No one wants to live in constant fear of being stranded or being in an accident because something in the car gave out. Reliability needs to be considered for every car, but especially if the typical route is remote, dangerous or unpredictable. It is even more important if you live in an extreme climate that is either very hot or very cold.Take newer car costs into account. While the idea of a newer, shinier car sounds nice, make sure you are counting all the costs especially if you need to add a car payment. Beyond the monthly principal and interest, keep in mind that insurance and annual registrations will likely be higher, too.Spend Some Time with The NumbersWhile a new, shiny car is fun, all too often it can create future financial hardship. So also consider the long-term financial impact of your decision. This includes:Used versus new car. Used cars typically give you the best price value, but limited supply is making used cars more expensive.Financing a vehicle has pitfalls. If replacing your car will require financing, be careful. Interest rates are going up and highly leveraged loans can quickly put you into more debt than the car is worth. This often happens if your car is damaged in an accident.Cars are unpredictable but taking an analytical approach and making the best decision with the facts that you have will pay off more times than not.Article Submitted by Senior Tax Advisory Group. Call them with any questions at 719-596-4844

Generally, you can only contribute to a Roth IRA if you have taxable compensation and income less than the top of the phaseout range for your filing status (see chart below). If your income is greater than that threshold amount, you are prohibited from contributing directly to a Roth IRA. A backdoor Roth IRA allows a taxpayer to bypass income limitations by first making a nondeductible contribution to a traditional IRA and then converting it into a Roth IRA. Due to the distribution rules for traditional IRAs, this works best if you have no other traditional IRAs. Roth IRA Limits 2023                        Roth IRA PhaseoutsIndividual Contribution Limits              MFJ or QW $ 204,000 to $ 214,000        Under age 50 $ 6,500                            Single, HOH, $ 129,000 to $ 144,000                                                                                                                                                  Age 50 or older $ 7,500    Conversion of nondeductible IRA.If you make a nondeductible contribution to a traditional IRA, you can convert the entire amount tax-free. Only the earnings on the nondeductible IRA contributions are taxed.Example: Manny is single and has a modified AGI of $250,000. He wishes to save money in a Roth IRA so he can make nontaxable withdrawals upon retirement. In 2022, he opens a traditional IRA with a $6,000 nondeductible contribution and a couple months later, converts it to a Roth IRA. He has no other traditional IRAs. At the time of Roth conversion, the account had increased in value by $250, which is the only taxable part of the conversion.Working with the right financial professional is critical! Be sure to work with a financial professional who understands taxes and can help you plan and take the necessary steps toward a tax-free retirement.

For most of us, when thinking of wealth, we think about having lots of money, a big piece of land, material things, or multiple real-estate properties that may increase its value. All of these can lead to the accumulation of wealth.  Still, others have the idea that money is what makes the world go around. However, wealth is often not measured by monetary value, and the meaning of wealth can vary.Although money and possessions may help support individuals and their families financially, self-care is an essential facet of wealth not to be overlooked. When you take care of yourself, it may be easier for you to take care of the people you care about as well. Here are different types of wealth that you cannot measure in dollars and cents:Relationships To consider yourself wealthy in your relationships can take work. But the rewards of relationships can be priceless to those involved. For example, being a friend can reward your friends and family with someone they can count on to lend support and a listening earyou!Devoting time to staying connected through events, lunches, golf games, or even watching over grandchildren can result in a healthy relationship and mental health. Building wealth in your relationships directly correlates to your self-esteem. It is part of nurturing a support system that can be helpful during the inevitable and often challenging times of one's life.Personal growth When it comes to personal growth, people may correlate it to earning money. Where should you go to college to help you land the highest-paying job? What should you study? Often, wealth through personal growth comes from other things besides education or professions.To achieve personal growth, try something new that helps you see the world differently. Engage in conversations that challenge your current way of thinking. Surround yourself with people who will encourage you to be the best version of yourself. All these things can make achieving personal growth much simpler. In addition, by gaining knowledge and expertise in intentional ways, you may see improvements in problem-solving and leadership abilities, have empathy toward others, and become a positive influence on others.HealthAs we age, health often becomes more valuable to us. How we treated our bodies in our lifetimes may determine our health later in lifesmoking, overeating, or a lack of exercise may lead to health problems and the early depletion of assets. But even more valuable than assets is our healthwithout health, personal growth, relationships, and accumulating assets becomes difficult. The saying, Health is Wealth, reflects this reality.How do you define wealth? Your definition of wealth determines how you plan for the future you envision. Connect with your financial professional to discuss your meaning of wealth and your financial goals.   Editors Note: This article was submitted by Darian Andreson, of Senior Tax Advisory Group. He may be reached at 719-596-4844 or by email at Info@SpringsTax.com

Here are moves you can make to reduce your taxable income. But the year is quickly coming to a close, so plan accordingly.Tax loss harvesting. If you own stock outside a tax-deferred retirement plan, you can sell your under-performing stocks by December 31st and use these losses to reduce any taxable capital gains. If your net capital losses exceed your gains, you can net up to $3,000 against other income such as wages. Losses over $3,000 can be used in future years.Selling appreciated assets. Planfully sell appreciated assets in the tax year that helps you the most. While this strategy may be hard to accomplish this late in the year, it is still worthy of consideration. To do this, estimate your current year taxable income and compare it to next year's projected income. Then sell the appreciated asset in the year that will yield the lowest tax. Remember to account for the 3.8% net investment income tax in your estimates.Max out pre-tax retirement savings. The deadline to contribute to a 401(k) plan for a 2022 taxable income reduction is December 31st. So, if your employer's plan allows it, consider making a last-minute lump sum contribution. For 2022, you can contribute up to $20,500 to a 401(k), plus another $6,500 if you're age 50 or older. Even better, you have until April 18, 2023, to contribute up to $6,000 into a traditional IRA. And as long as your income does not exceed phaseout limits, you can reduce your taxable income on your 2022 tax return.Bunch deductions so you can itemize. If your personal deductions are near the following standard deduction amounts for 2022: $12,950 for singles, $19,400 for head of household, and $25,900 for married filing joint, consider bringing some of 2023's spending into 2022 so you can itemize this year. For most, the easiest way is to do this is to make 2023's planned charitable contributions before the end of 2022. You can also include gifts of appreciated stock where you get to deduct the fair market value without paying capital gains tax.Review health spending accounts. If you participate in a Health Savings Account (HSA), try to maximize your annual contribution to reduce your taxable income. Remember, these funds allow you to pay for qualified health expenses with pre-tax dollars. More importantly, unlike Flexible Spending Accounts (FSA), you can carry over all unused funds into future years. If you do have an FSA, you can carry forward a maximum of $570 from 2022 into 2023. The deadline for contributing to your Health Savings Account (HSA) and still getting a deduction for the 2022 tax year is April 18, 2023. The maximum contribution for 2022 is $3,650 if single and $7,300 for married couples.While the year is quickly coming to an end, there is still time to reduce your 2022 tax liability, but only if you act now.Article Submitted by Senior Tax Advisory Group. Call them with any questions at 719-596-4844

The Social Security Administration announced a whopping 8.7% boost to monthly Social Security and Supplemental Security Income (SSI) benefits for 2023. This is on the heels of a 5.9% increase last year. The increase is based on the rise in the Consumer Price Index over the past 12 months ending in September 2022.For those contributing to Social Security through wages, the potential maximum income subject to Social Security tax increases to $160,200. This represents a whopping 9% increase in your Social Security Tax! Here's a recap of the key dollar amounts:2023 Social Security Benefits - Key InformationWhat it means for youUp to $160,200 in wages will be subject to Social Security taxes, an increase of $13,200 from 2022. This amounts to $9,932.40 in maximum annual employee Social Security payments (an over $800 increase!) so plan accordingly. Any excess amounts paid due to having multiple employers can be returned to you via a credit on your tax return.For all retired workers receiving Social Security retirement benefits, the estimated average monthly benefit will be $1,827 per month in 2023, an average increase of $146 per month.SSI is the standard payment for people in need. To qualify for this payment, you must have little income and few resources ($2,000 if single, $3,000 if married).A full-time student who is blind or disabled can still receive SSI benefits as long as earned income does not exceed the monthly and annual student exclusion amounts listed above.Social Security & Medicare RatesThe Social Security and Medicare tax rates do not change from 2022 to 2023.Note: The above tax rates are a combination of 6.20 percent Social Security and 1.45 percent for Medicare. There is also a 0.9 percent Medicare wages surtax for single taxpayers with wages above $200,000 ($250,000 for joint filers) that is not reflected in these figures. Please note that your employer also pays Social Security and Medicare taxes on your behalf. These figures are reflected in the self-employed tax rates, as self-employed individuals pay both halves of the tax.

Saving is the usual buzzword when it comes to planning for your post-work years. But accumulation leading up to retirement is only half the storyunderstanding how the funds will be dispersed is the other crucial, yet often overlooked, aspect of the planning process. While a recent Prudential study[1] notes that there are more people than ever before retiring and entering the distribution phase, their knowledge about this delicate period of managing investments and coordinating withdrawal strategies is often limited, and could be costly. When youre over the age of 50, you need more than a pie chart, you need a distribution plan says Darian Andreson, principal of Senior Tax Advisory Group, a financial planning firm located in Colorado Springs, Colorado. There are approximately 10,000 people retiring every day. Of these retirees polled, the number one concern consistently shared is that they fear running out of money in retirement. It seems there is too much emphasis today on the diversification of portfolios and pie charts, and not enough time and attention spent on how to coordinate and fund quality of life in retirement.  No one can control when the next major market correction will occur, but there are dozens of critical things that a retiree can control, which can result in hundreds of thousands of extra dollars in their pocket, giving them a far better opportunity to address the fear of running out of money.Since many of these retiring baby boomers will rely on social security as a good portion of their post-retirement income, understanding how the system works and how various decisions that will impact the amount of benefits received make it vital to get good information prior to distribution time. The revelation of Social Security is not so much about when you file, as much as it is about how you file, comments Andreson. When a plan is properly designed, we regularly see families receive a few hundred thousand extra dollars in Social Security benefits over a lifetime, in addition to tens of thousands of dollars in tax savings based on the tax favorable nature of these benefits becoming a larger part of their income distribution plan.In addition to designing a plan to maximize benefits, taxes are another important planning consideration. Although social security income is not taxable in and of itself, other income sources like withdrawals from 401ks or pension plans can cause our social security benefits to become taxable as high as 85%. For most, what they pay in taxes will represent the single largest expense they will have in retirement, just next to healthcare says Andreson.  Changes in the tax codes, also greatly affect how much tax retirees will pay on their income, so staying abreast of these types of changes and how they affect social security as well as other types of savings vehicles is also a key to keeping more money in the bank and seeing less going to the IRS.With so many moving parts to the retirement planning equation, Andreson emphasizes the importance of enlisting the assistance of a planner, particularly one who focuses on the distribution phase. Do-It-Yourself is too expensive when it comes to retirement planning. Though a bit of money is saved in the short-term, the unfortunate reality is that this type of planning can be both difficult to quantify and to properly execute, so mistakes are easy to make. There are no do-overs, so getting it right from the start makes all the difference, he says. And what exactly should a distribution plan consider? Of course, the most obvious consideration is ones planned age at retirement versus ones life expectancy. If an individual retires at 65 and lives until 90, his or her money has to last for 25 years. Its surprising how a simple thing like estimating life expectancy and the need to coordinate a plan to fund the needed after tax income is so rare in todays world of planning, Andreson remarks. Its likely because no one likes to think about mortality, but this is something that cant be avoided when talking distribution. Other important considerations include estate planning, inflation, the rising costs of healthcare and prescriptions in conjunction with a rising need for them as we age, all of which should be explicitly discussed and mapped during distribution planning.Whatever the particular considerations and whatever form the conversation about distribution takes, it has to happen and should be an ongoing part of the planning discussion. The bottom line is that no one should feel comfortable calling him or herself a retirement planner if he or she doesnt include Social Security maximization, withdrawal strategies or tax implications in their planning process. Putting these missing pieces together in the puzzle can make all the difference in the world. For more than 2 decades, Darian Andreson, CSA, has been guiding (and educating) retirees as they transition into retirement. Darian is the CEO of Colorado Springs Senior Tax Advisory Group a Registered Investment Advisory Firm and Insurance Agency.Website: www.SpringsTax.com

To learn more about Senior Tax Advisory Group, CLICK HERE.Effective financial planning is always a goal for everyone. After all, who wants to either lose any of their hard-earned money and/or pay more than what is required by law to the IRS every year? In a down economy, these thoughts often escalate from 'back burner' things you should do to 'center stage' emergencies. But what can you do to protect your assets? There are lots of options, but here are two good places to start:1) Make sure that all your advisors are communicating with each other. Ask yourself, "How often does your tax preparer or CPA communicate with your financial advisor or stock broker?" For most folks, unfortunately, it is, at most, only once a year maybe during tax season. If there is no communication between the person who is making you money and the person who is saving you money, who do you think gets hurt in the middle? You do. And there is a third advisor that also needs to be in this open communication process your estate attorney. Not everyone may need an estate attorney. However, over 70% of retirees are currently without any type of estate plan or even a valid will. Without communication between these three professionals, there is confusion... and nobody wants that in their estate, especially during their retirement years.2) Safety is also a big concern. Many people are unaware of the amount of risk they hold in their portfolio. When retired, the preservation of principal is much more important than a high rate of return. There is no longer income to offset market losses and you have to live off of what you have accumulated. There are safe vehicles out there, such as fixed annuities, which provide upside potential with no downside risk, along with a stable rate of return.Most importantly, whether it is your investments, tax situation, or estate plan, find out what you have! If you don't have a plan, the government definitely has one for you and nobody wants to start planning in that 12th hour. Nobody cares (or should care) about your financial plan more than you!Editors Note: This article was submitted by Darian Andreson, President of Senior Tax Advisory Group. For additional information, contact them at 719-596-4844

One of the most common reasons businesses fail is due to lack of proper cash flow. The same is often true in many households. Here's how this concept of cash flow applies to you along with some ideas to improve it.Cash Flow DefinedCash flow equals cash coming in (wages, interest, Social Security benefits) and cash going out in the bills you pay and money you spend. If more is coming in than going out, you have positive cash flow. If the opposite is true, you have negative cash flow. Unfortunately, calculating and forecasting cash flow can get complicated. Some bills are due weekly, others monthly. A few larger bills may need to be paid quarterly or annually.Create Your Cash Flow SnapshotBefore improving your cash flow, you need to be able to visualize it. While there are software tools to generate a statement of cash flow, you can also take a snapshot of your cash flow by creating a simple monthly spreadsheet:Type each month across the top of the spreadsheet with an annual total.Note all your revenue (cash inflows), then create a list of expenses (cash outflows) in the left-hand column.Enter your income and bills by month. Create a monthly subtotal of all your inflows. Do the same for your cash outflows. Then subtract the expenses from income. Positive numbers? You have positive cash flow. Negative numbers? You have negative cash flow.Create a cumulative total for the year under each month to see which months will need additional funds and which months will have excess funds.Ideas To Improve Your Cash FlowIdentify your challenges. See if you have months where more cash is going out than is coming in to your bank account. This often happens when large bills are due. If possible, try to balance these known high-expense months throughout the course of the year. Common causes are:HolidaysProperty tax paymentsCar and homeowners' insuranceIncome tax paymentsVacationsBuild a reserve. If you know there are challenging months, project how much additional cash you will need and begin to save for this in positive cash months.Cut back on annuities. See what monthly expense drivers are in your life. Can any of them be reduced? Can you live with fewer cell phone add-ons? How about cutting costs in your cable bill? Is it time for an insurance review?Shop your current services. Some of your larger bills may create an opportunity for savings. This is especially true with home and car insurance.Create savings habits to add to cash flow. Consider paying a bill to yourself in your cash outflows. This saved money is a simple technique to create positive cash flow each month to build an emergency reserve.