5 Steps on how to travel for less

ST. CROIX INSIGHTS

5 Steps on how to travel for less

BY BRETT ANDERSON/ST.CROIX ADVISORS, LLC

I have a bucket list of travel; those go to places I want to get to before I die. We have a calendar outlining when we’d like to go to various places. When you are in your working years, you don’t always have time to get away and when you’re older you have the time but not always the ability. Travel when you can to explore and hopefully better understand our world. Here are 5 steps on how to travel for less.

Treat your vacation like your money.

  • Know the ins and out of where you are going. What tricks, money and time saving ideas you need to know BEFORE going. Invest in a good guidebook for $25. Skip the lines. Lines cost you time which is money. Especially in Europe, I don’t understand why people even stand in line hours waiting to purchase tickets.

Fly into one airport and out another.

  • We do this all the time to see explore areas we’d never see. Usually, the car rental companies will charge you an extra $50.00 to drop off at another location, but well worth it.

Find rooms on the fly and ask for deals.

  • There are so many cool travel apps that can help you accomplish this and you never know where you’ll end up.

Rediscover old friends, relatives and others in your network.

  • Why not stay with people you know, or even make new friends. I see this with working well throughout Europe. What a cool way to enhance your travel experience and get to know the culture even more.

Take or watch a travel class.

  • Rick Steves or Samatha Brown are two travelers that I follow. Rick’s advise is right on when it comes to traveling in Europe. He doesn’t like cruise ships but I found them enjoyable traveling from one destination to the next throughout Europe. Plus, they have great travel videos on their websites.

Bonus advice – Get a Global Entry Card.

  • This is so cool I don’t even want to tell others about. You get TSA pre-check and it allows for easy access when going through Customs for international travel. Some credit cards will even reimburse you $100.00 every four years if you have this card.

With Summer approaching fast, if you’d like a few travel destination ideas give me a shout. I can help with some great travel destinations.

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Financial Simplicity – becoming empty nesters

ST. CROIX INSIGHTS

Financial Simplicity – becoming empty nesters

BY BRETT ANDERSON/ST.CROIX ADVISORS, LLC

Sometimes even the shoemaker needs new shoes.

With my kids getting older and one living in Texas, our life continues to change as the kids get older. One thing I’ve noticed as the kids get older, so do I. Aging is a privilege but I’m not a fan of getting old and at times I think I’m in my late 20’s (you can stop laughing!). Even I want financial simplicity for my family and myself. As we are planning for our life without kids (full-time) it causes us to evaluate what we want to achieve, what type of lifestyle we seek and the decisions we need to make around that.

Selling and moving from our family home.

I suspect for most parents this so much more emotional when you sell your family home. Probably many more happy memories with the birth of your children, birthdays, Christmas, first day of school and finally graduating from high school. I don’t think I’m different from anyone of my clients, you no longer need that bigger home and its time. However, I just can’t believe how much “stuff” you can accumulate over the years. This is a great time to simplify how much “stuff” we truly need and most importantly use. I suspect I use 15% of my stuff 80% of the time. I’ll be having a moving sale to offload stuff at great prices.

More free time for yourself and your spouse.

New or revisiting hobbies. Getting used to spending time and reengaging with your spouse. For many couples I meet with, this is probably the scariest thought of their retirement years. Can we actually spend time together? Can we spend time together without the kids let alone not talking about them? Will we be able to bring back the magic we once had when we first dated? After 30 years with kids and now without kids, are we going to be compatible?

I’m a big believer in creating a dream board. A visual display of things you’d like to accomplish together and/or separately. Maybe it’s travel, spending time with family, learning new stuff, taking a college class, or being impactful in your community. The ideas are endless. Sometimes your dream board might a big idea and you wonder how you will accomplish it. That’s half the fun of a dream board.

We can simplify our life no matter what stage we are in and it becomes especially easier when we become empty nesters. Investing a little time in thinking, dreaming and focusing, allows us to even enjoy our lives more.

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Why limit ourselves to only 52 Saturdays a year?

ST. CROIX INSIGHTS

Why limit ourselves to only 52 Saturday’s a year

BY BRETT ANDERSON/ST.CROIX ADVISORS, LLC

First of all, I enjoy my profession, but I can’t wait to enjoy 365 Saturdays a year. To me, Saturdays represent freedom. Freedom to pick and choose what I want to do, not what I have to do to pay the bills. By now, we’ve worked for 30, 40 or 50 years. Nowadays, our work is our identity. We work hard and that’s who we are. For many, one major worry is that they’ll be bored in their retirement years.

For the majority, our conversation around retirement planning includes how to be relevant and impactful in your retirement years. All this time, we’ve been so focused for 260 days a year on working and now we’re preparing for the next stage in life that for many doesn’t include working. For most retirees, that’s a big change.

Honestly, my retired clients tell me they are busier in their retirement years vs. when they were working for themselves or “the man”. Soon, they wonder how they got anything done while they were working. Now, many volunteer, have hobbies, spending time with grandkids, travel, and the list goes on.

For some, their hobby is their work. In fact, I might fall into that group. Don’t judge me, I’m just being honest. When you own a business, it’s a way of life. 365 days a year and you (or at least I haven’t been able to) can’t turn it off – even on Saturdays. Actually, I think that’s why so many business owners postpone their retirement. Usually, it’s not about the money, but rather how to be relevant. Further, what am I going to do in my retirement years so I don’t drive my spouse nuts?

Many of you reading this have an option to stay relevant in your retirement years and start a “trial” retirement. Eventually, you may start working four days a week and not check your email on Saturdays. At first, this might be a great strategy. Next year, scale back to three days a week for that second year. Lately, I’ve received pushback about this because people don’t believe their employers will go for it. First off, if you are a good employee, an asset to the company, they need you. Secondly, this concept is mutually beneficial for both. Because you stay engaged, they retain a seasoned employee to help the company reach its goals. All in all, it’s a win/win for both.

Enjoying more Saturdays now is powerful. Trust me, it’s powerful to spend time engaged outside of work. Travel, volunteer, spend time with the grandkids while you can. Starting today, pursue the passions you’ve postponed all these years because you and I had the pursuit of money to pay our bills and feed our families. Seriously, do it while you can. Do it while you’re able to move, walk, remember and share. In time, you won’t have those opportunities.

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Advantages of retiring to Florida

ST. CROIX INSIGHTS

Advantages of retiring to Florida

BY BRETT ANDERSON/ST.CROIX ADVISORS, LLC

Sure, we all have some very obvious reasons for retiring to Florida.

Sun, warm weather, no estate or income taxes. From my perspective, how many more reasons do you need? As I write this on a Saturday night, watching playoff football, tomorrow morning’s low will be 43 degrees (No, that’s no typo) here in Naples, Florida. Down here they consider that cold. Big jackets, gloves, hats and I suspect long underwear will be essential for natives. For you snowbirds from Minnesota and Wisconsin, we’d be wearing shorts at home.

I see retiring to Florida as a lifestyle choice.

You want to enjoy the great outdoors year-round. You won’t miss the cold nor the snow. You’ve put up with all of that stuff for years let alone decades and now it’s time. The sun, warm weather, walking along the ocean, palm trees, etc.

While in Naples, Florida, I attended the Minnesota Men’s Breakfast (it’s not just men – women do attend and are invited). Prominent speakers, timely topics and a room of hundreds of people come together each week for three months during the winter. It’s almost like a homecoming each week when you see everyone greeting each other. Naples just happens to be Minnesota’s most southern city! Coming to one location, knowing so many people from back home is just darn cool.

Gov. Dayton certainly likes to tax the so-called rich by insisting on having an estate tax. In 2018, the threshold is $2.4 million. I suspect many of you reading this feel like that’s a lot of money. The reality is it’s not, particularly when you start adding everything you have from your home, retirement, life insurance and investment accounts. Remember, you and your estate have to pay taxes because you died. Isn’t that enough? You’re dead. Why does the government need to take my money? For those of you living in Wisconsin, you also enjoy no estate taxes just like Florida residents. But it’s still cold.

With the new federal tax law, living in a higher income tax state is going to cost even more.

For those of us who itemize, we will only be able to deduct to up $10,000 a year on our federal taxes. That seems like a big number, but when you total your state, sales and property taxes, it can easily be well over $10,000. In other words, you will be paying more for the privilege of living in the land of Gophers or Badgers.

Some states tax your Social Security benefits in your retirement years and some don’t. Minnesota’s elected officials have never met a tax they didn’t want to implement including taxing your Social Security. Florida and Wisconsin residents enjoy no tax on their Social Security.

Wisconsin is Minnesota’s Florida. Florida is Wisconsin’s Florida. Florida is just Florida. Taxes play a major role in our retirement years along with friends, family and lifestyle. If you are looking to relocate to Florida full time or become a “six months and a day,” let’s talk about how to make that a successful transition.

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I love Roth’s and so should you – Four keys for Roth accounts.

ST. CROIX INSIGHTS

I love Roth’s and so should you – Four keys for Roth accounts.

BY BRETT ANDERSON/ST.CROIX ADVISORS, LLC

ROTH Account

One of most powerful financial tools that Congress created was the Roth IRA/401(k) Roth accounts. If you had a $1 million in a Traditional IRA and $1 million in a Roth IRA, which one would be worth more?

The answer is the Roth IRA as these accounts are not taxed upon the distribution of the funds if you follow these four keys:

    1. Rules….no one likes them but with each type of retirement account you fund, you make a deal with our government. Yet, I contend the Roth IRA rules are extremely favorable. Favorable doesn’t mean simple. There are tons of rules to comply with to avoid taxes or penalties with Roth accounts.
    2.  Many of you have been told you CAN’T fund a Roth account because your income is too high. In technical terms, your Adjusted Gross Income (AGI) based on your 1040 falls above the funding thresholds. But that’s not the entire story. You can fund a Roth IRA accounts even if your AGI is high. The best strategy is funding a non-deductible IRA and right away do an IRA Conversion to a Roth IRA account. Simple, done. You funded a Roth IRA account. Now it’s a little more complicated if you have IRA accounts with account balances and that’s where we need calculation a tax rate on the conversion.
    3. Another big misconception is around your employer’s 401(k) Roth option. Many believe if your AGI is too high you still cannot contribute to your employers. Employer 401k plans DO NOT have income limitations around funding a Roth account.
    4. These accounts do not have Required Minimum Distribution (RMD) levels. Yet 401(k) Roth accounts do at age 70 ½ unless you are still working for the company.

Roth accounts are powerful financial tools when you follow the four keys.

St. Croix Advisors, LLC is an investment advisory firm. We seek to help our clients achieve financial simplicity. Before implementing financial ideas, you read, work with a Certified Financial Planner (CFP) or CPA for advice or recommendations that fit your own financial situation. The content is developed from sources believed to be providing accurate information.

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2018 Employee Benefit Open Enrollment

ST. CROIX INSIGHTS

2018 Employee Benefit Open Enrollment

BY BRETT ANDERSON/ST.CROIX ADVISORS, LLC

It’s hard to believe 2017 is coming to an end open enrollment is just around the corner. It’s easy to take your employer benefits for granted. But let’s not! Let’s make sure you have fully taking advantage of the benefits your employer offers. After all, you are working hard for them each day.

Here are a few key items to evaluate this year during your open enrollment period:
  • Join the 1% club. Increase your 401(k) savings each year by 1%. It’s easy, and you won’t miss the money.
  • Ask the question, will you have too much money in pre-tax retirement? This means when you retire will all of your income be taxable in your retirement years? Funding a Roth IRA is a great option for tax-free income in your retirement years.
  • Review your medical coverage. Have you or a family member’s health status changed? Will you require medical care outside of your primary network? Are you saving enough into your HSA account to cover items not covered by your plan and out of pocket expenses?
  • Examine your disability insurance. Chances are your largest asset is your ability to produce income. Are you fully insured in the event you develop a sickness or illness? Will your benefits be taxable? Read the policy, so you are informed.
  • Are there any new benefits? What benefits have you overlooked all these years and now maybe you should have them? Companies offer a host of benefits as your life changes, so will your needs. Keep up-to-date. Often having the proper amount of life insurance is an overlooked benefit until it’s too late.

If you need help analyzing your employee benefits, let’s schedule a time to meet to make sure they are properly incorporated into your financial planning.

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