F I N A N C I A L S E R V I C E S , L L C
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January 2018
A Year of Tax Relief?
90 — and that includes taking the required minimum distributions starting at age 70 1/2. At age 90, you have a much higher RMD percentage and a much higher account value that will equate to a higher tax burden for the rest of your life. That’s why you now want to consider converting IRA money to Roth IRA even if it’s a little bit each year. As you look toward the year ahead, take this tax season to get your ducks in a row. Think about how your taxes might change for the next tax year and before you file in 2019 for the new tax plan. When you take the time to think about your future and take the time to strategize, you’ll put yourself in the best position possible. You’ll live a thought-out retirement, perhaps the retirement you’ve dreamed about, all while reducing your tax burden. –Gary Mattson
that could later be used for travel or similar expenses. How is this behavior different than how you might behave during a non-tax relief year? If you’re in a higher tax bracket, you may want to harvest losses. Sell securities that performed the worst. Carry tax losses forward. Another thing to consider is moving money from an IRA to a Roth IRA. If you do not have earned income, you cannot contribute to a Roth IRA. However, you can convert money from an IRA to a Roth at any age if you pay the appropriate tax. A Roth IRA will never be taxed for growth. This eliminates any future income tax and capital gains. As an added bonus, you can pass it on, tax-free, to family members when you’re gone. That’s one less thing they have to worry about in the years to come. As you look at your current situation, say your IRA or 401(k) does well. You do not take withdrawals. Later in life, that could be a huge tax burden to you. An IRA with $500,000 at age 60 may become an IRA with $1.1 million at age
As the Republicans and the president finalize their tax relief plan, a lot of folks across the country want to know what it will mean for them. As it stands, it’s a front-loaded plan, meaning you’ll see the biggest benefit — that is to say relief — over the next few years. Then, as time goes on, those benefits will be reduced. This gives you a chance to prepare for the future, at least in terms of taxes. January is a great month to analyze the previous tax year. As you prepare for the new year, use the opportunity to go over 2017 taxes to see where you stand. It can inform you of where you need to go in the years ahead, including the 2018 tax year, which will introduce the new tax landscape. For instance, if you expect significant capital gains, 2018 is the year you want to take advantage of the associated higher tax deductions. Harvest the items that made money. Reinvest or hold these assets for future consumable purposes. This is income
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Hit ‘Download’
AND UNLOCK YOUR FITNESS POTENTIAL
Use filters to search for the type of class you want, from CrossFit to barre workouts. Once you’ve selected a class, you can secure a spot with the in-app reservation feature. There’s no need to fall behind in your Bodypump class. For ThoseWho Aren’t Morning People An app that lets you finish your morning workout in bed? Yes, please! Yoga Wake Up does exactly what the name suggests: It wakes you up with a short yoga or meditation routine. From“Reach and Root Wake Up” to “Spirit Wake Up,” you can select each morning routine’s intensity. Choose a wake up, set your wake up time, and let the gentle voice of your instructor clear away the morning’s inevitable grogginess. Forget breakfast in bed; you’ll feel so much better waking up this way.
to your training schedule. It also recognizes and maps routes you’ve run before. For the Meditation Newbie Wanderlust’s guiding mantra is “Find your true north.” During yoga, meditation, and Pilates classes, Wanderlust instructors can help you focus your energy and restore your physical and mental well-being. Download this app or visit Wanderlust’s website for free classes, like the 21-day yoga challenge, which can keep you disciplined and motivated. Additional workshops and events are available for a small subscription fee. For the Frequent Flyer Don’t miss your workout just because you’re away from your home gym. Use Rise Today to locate a class near you.
Bitcoin is in the news more than ever. Month after month, the value of the digital currency has done nothing but climb, and 2017 was its best year yet. The question is, is bitcoin worth the hype? Since its value began to climb last year, bitcoin gained the attention of just about everybody. It’s become something of an investment darling. But before you climb aboard the bitcoin express, you need to know what you’re getting into. relies on a form of cryptography to keep users’ transactions secure. On top of that, what many users find attractive about bitcoin is the lack of centralized regulation. There is no Federal Reserve or regulatory body overseeing the currency. Everything is completely decentralized, relying on a peer- to-peer system to function. If you’re not familiar with bitcoin, it’s a cryptocurrency. In other words, the currency Do all your early morning workout plans blast out of the jet engine when you travel? New time zones and ill- equipped hotel gyms may make you want to put off training. But now, with the internet just a tap away, there’s no excuse to miss a workout. Being away from home doesn’t mean you have to abandon your fitness goals. Check out these apps (most of them are available for free from iTunes or Google Play) and work out wherever your travels take you. For the Marathon Trainer If you forget your Fitbit and need to track your miles, Moves has your back. With automatic tracking capabilities and features that tell you how far you’ve walked, cycled, or run, this app will help you stick
THE QUESTION OF BITCOIN Is the Digital Currency Worth Your Time and Money?
paper puts it, “[Bitcoin’s] value is completely dependent on the confidence it inspires.”
There are many services online you can use to add bitcoin to your portfolio. You should do as much research as possible before taking the plunge. But beyond that, you need to be aware of the challenges that come with buying bitcoin. The biggest difficulty is volatility. The KBC Group, a Brussels-based bank and asset management firm, says the risk associated with bitcoin is too high. For one, as an investment, bitcoin does not generate interest, and when you cash out, you do have to pay capital gains. Returns come directly from its value at the time of sale and nothing more. As a recent KBC white
Bitcoin also comes with the challenge of security. Because bitcoin has the attention of so many people and its value keeps going up, data thieves are targeting the digital currency. When you buy bitcoin, you get an associated “private key.” If the key gets stolen, or you lose it, you’re out of luck. You must be careful. If you are considering buying into bitcoin, the best piece of advice is to do as much research as possible. Stay informed about what you’re buying and be aware of the risks.
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Do you spend too much on“fun,”such as dining out, or going to concerts and movies? If you are, what are you doing about it? These days, it’s easy to blow your money on amusement. But as a recent AARP report suggests, the problem isn’t necessarily the spending— it’s the way the spending is tracked. In retirement, tracking your spending is as crucial as ever. However, in retirement it can also be hard to say no to those extra expenditures. Thanks to credit cards and electronic payment options like Apple Pay and GoogleWallet, you can buy to your heart’s content during an evening out without realizing exactly howmuch you’re spending. Some financial experts, such as Chris Hogan, author of“Retire Inspired: It’s Not an Age, It’s a Financial Number,”say cash is the best way to go. For instance, give yourself $200 to spend every two weeks on discretionary items. Once the cash is gone, you have to wait until the next two-week cycle to re-up. While this is a great way to stick to an exacting budget, it’s not really a way to track spending. You can track spending manually, but a lot of people don’t. With fewer people relying on checks, we’re facing a reality in which people simply don’t take the time to balance their accounts by hand. Interestingly, there are financial experts who say credit cards are the way to go when it comes to tracking your spending. Eric Tyson, author of“Investing for Dummies”and co-author of“Personal Finance After 50 for Dummies,”says credit cards are the ideal tool for this purpose. His reasoning: When you use a credit card, you can track your spending better. Many people use smartphone apps to track their spending, generally through an app tied to their bank or credit card issuer. You can check the app to see exactly howmuch you’re spending, along with when and where. The point is, when you want to rein in your discretionary spending— or your spending in general — knowing howmuch you’re spending gives you a huge advantage. How are you tracking your spending? New Year, New Spending Habit REIN IN YOUR DISCRETIONARY SPENDING
LAUREL’S PISTACHIO GOJI BERRY GRANOLA
1 cup rolled oats 1/2 teaspoon salt Ingredients
1/3 cup pistachios, chopped 1/4 cup coconut flakes 1 teaspoon cinnamon 1/3 cup goji berries
1 tablespoon coconut oil 3 tablespoons maple syrup
Puzzle Your Brain!
Directions
1. Heat a large skillet over low heat. Add oats in a thin layer and toast for 1–2 minutes. Add coconut oil and salt, then stir. Continue toasting for 5–7 minutes, stirring occasionally. 2. Add maple syrup 1 tablespoon at a time; stir to coat. 3. Once oats are toasted, add pistachios, coconut flakes, and cinnamon. Cook slowly until pistachios and coconut flakes are toasted but not burned, about 5 minutes. 4. Remove from pan and stir in goji berries. 5. Let cool and enjoy as a snack or on top of your yogurt!
Recipe inspired by LoveAndLemons.com.
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F I N A N C I A L S E R V I C E S , L L C
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3226 28th Street SE Kentwood, MI 49512 INSIDE THIS ISSUE
Is 2018 the Year of Tax Relief?
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Reinvent Your Out-of-Town Workouts With These Apps Is Bitcoin Worth It?
Start the Day Right With This Granola Is It Time for a New Spending Habit?
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The Time Is Right for Nicaragua
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**Reminder: If you have any changes to your financial situation, please notify us as soon as possible.
Investment advisory services are offered through Mattson Financial Services, LLC, a Registered Investment Adviser in the state of Michigan. Insurance products and services are offered through Lakeview Financial Group, LLC. Mattson Financial Services, LLC, and Lakeview Financial Group, LLC are affiliated companies.
ESCAPE TO NICARAGUA
The Country That Has Something for Everyone
You can also visit the gorgeous, alabaster Our Lady of Grace Cathedral in“new”Léon. The biggest church in all of Central America, this unique Baroque and neoclassicist structure was built in 1814. Visitors can climb onto its roof (as long as they don’t wear shoes) and bask in the view of surrounding volcanoes (including Cerro Negro). If you’re planning on heading to Nicaragua, it’s best to do it soon. Neighbor Costa Rica often overflows with tourists, and instead of wading through the crowds there, many travelers are catching on to what Nicaragua has to offer.
of the most active volcanoes in the region. It only takes about an hour to scale its smoking, black gravel surface, and the verdant forests surrounding the peak are a sight to behold. Adventurous travelers can board down the side, reaching ludicrous speeds as they teeter and try not to fall. In fact, it’s almost impossible to travel anywhere in the country without seeing an“I boarded a volcano”T-shirt. If relaxing on a pearlescent beach is more your speed, take a short boat trip out to the Corn Islands. There, you can amble around the small towns bordering the shockingly blue Pacific, visit a number of laid-back seafood restaurants, get scuba certified for a fraction of the price anywhere else in the world, or just read your book as you swing in a hammock by the waves.
After the hectic holiday season, many of us feel like we need another vacation just to unwind. Luckily, January and February are two of the best months to travel. Flight prices plummet and crowds thin out after the Christmas rush. If you’re looking to escape the dreary winter weather, there’s no better place to visit this season than Nicaragua, the“Central American country that has it all,”as Condé Nast Traveler puts it. Whether you’re looking to explore the rainforests surrounding the Río San Juan or get lost in the quirky-yet-beautiful architecture of Granada, there’s something for everyone in this tropical wonderland.
One must-see destination is the Cerro Negro volcano. Just a baby at 150 years old, it’s one
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