The reports from retailers indicating that Black Friday revenues were 7 to 14 percent more than last year were encouraging from an economic perspective, but it could be disastrous for consumers who may be adding more debt that they cannot afford to their personal balance sheets.

Since the recession of 2008, consumers have been doing a good job of reducing their debt levels. However, many people are still out of work, and in Philadelphia specifically, the unemployment rate is still hovering around 10 percent versus 9 percent for the entire country. continue reading »

Life insurance is something we hope we never need, but really need to have. The number of families that
have little or no life insurance is startling. I see it every day as I meet with people in the Northeast and the
surrounding area. Here are some things to keep in mind to mind as you consider your own situation.

First, there are several different types of life insurance; our focus today is in on term insurance.

Many employers offer a base level of coverage, which could be flat dollar amount ($10,000 or $20,000), or one times your annual salary up to $50,000. Most companies will not offer company paid coverage above $50,000, as they are generally limited to a tax deduction for the premium cost up to $50,000. In many instances, the premium cost for the insurance is higher than you would pay to purchase your own policy.

Second, if you leave your job, your life insurance will either stop immediately or within a few weeks of your
separation. In this economic environment, it could take some time to secure another position, and if you have no other coverage, you will be at risk during this period. continue reading »

Since interest rates have been at historic lows for an extended period of time, banks have been increasing their fees to recoup lost income.

If you bank with a traditional banking institution, it would be wise to acquaint yourself with the charges you may be paying on your accounts. Many banks have increased the minimum balance requirements on their non-interest checking accounts. If your balance falls below the minimum, you will be hit with a fee (my bank charges $15 and others are higher).

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Beginning to plan for retirement should begin when you are in your 20s, as many academic studies have shown that the earlier you start, the more likely you are to achieve your savings goal.

Those on the other end of the spectrum (in the mid 50s to early 60s) need to begin thinking about how they will manage their cash flow (amount of money coming in and out) once they are in retirement. One of the biggest drags on the average household’s cash flow is debt – mortgage, credit cards, car payments, etc.  Those approaching retirement must address their debt effectively to make sure they do not wind up cash poor in retirement. continue reading »

The markets over the last few weeks have awakened the anxiety that we experienced back in 2008. While there are many companies reporting strong earnings, the overall growth of the US economy has slowed.

Unemployment and housing continue to be two of the biggest obstacles to our recovery. Housing prices have continued to fall in many markets and unemployment was 9.1 percent at the end of July. Many academics and politicians are debating the probability that we are headed for another recession. There are a number of measures (some tracked by the Fed and others by private investment companies) that point to continued slowing of the economy.

Given all the volatility, what are we supposed to do? There a number of things that you can do to help your financial health. continue reading »

Jim Heisler is on vacation, so below, find his most popular column of all-time, on 2011 tax changes.
Congress is mulling over what to do about the soon-to-expire Bush tax cuts that were enacted in 2001 and 2003.

As a result of the sunset provision in the tax law, you may have read about the fact that there is no estate tax in 2010. If you were wealthy and had the choice, this would be the year to die.

A great example is George Steinbrenner, who passed away last week. If we assumed that the only asset he held at his death was the Yankees, he saved his family approximately $450 million by dying in 2010 (assuming the value of the Yankees at $1 billion and federal estate rate of 55 percent). continue reading »

I had a conversation this week with a client that is stepping up to helping out an elderly uncle. Her aunt died a few years ago and they never had any children. Does this story sound familiar to you?

The uncle, while still sharp, is not in the best physical shape and needs help getting around, etc. A common theme with elderly people like this is that they usually have money in several different places – whether it is different banks or investment companies.

In the past it may have made sense to spread your money out to many places to reduce risk, and maybe get a better interest rate; however, with all the consolidation that has taken place, commercial banks have gotten much bigger in size, and interest rates are pretty comparable. Also, the government raised the FDIC insurance coverage to $250,000 per account holder. So, if you find yourself in this situation what should you do? continue reading »

In doing some research I came across a series of quotes from Ben Franklin and thought it very timely – given the Fourth of July holiday.

Arguably one of the greatest Americans of all time, Ben Franklin was an inventor, business owner,  statesman and author. Ben may be remembered most for his impact on American history, but if you review some of his famous quotes, he was a man with tremendous financial wisdom. Here is a brief list of some of those quotes. You will certainly recognize some. continue reading »

Over the past few months, I have had meetings with many clients who have not been able to accumulate significant balances in their 401ks and 403bs.

A common theme with these clients is that they will not have pensions in retirement. The employers they work for provide defined contribution plans (e.g. 401k, 403b, profit sharing plan, etc.). With these plans the employee bears all the risk of providing their own retirement income. Under a traditional pension, the employer bears the risk of guaranteeing the stream of income to the worker in retirement.

So, if you are in your late 50s or early 60s and find yourself in this situation, all hope is not lost. There are a few things that you can do to help yourself. continue reading »