Hello Clients, Friends and Family,
Finally back in the Newsletter business. We had some issues with the old format but got them worked out in a new format that is much easier for me to work with on a consistent basis. I am using a new website for this at www.BobCraig.biz.
I still have www.SolvangTax.com but with BobCraig.biz, I can actually go in and set up posts, alerts, newsletters and the like. I’m still learning but I built this myself from scratch and it’s kind of fun, a bit frustrating, but fun. It’ll improve as time goes on.
Be sure to go to www.BobCraig.biz as my goal is to post articles daily. You’ll notice a section for ‘Recent Posts” to the left that goes back 15 posts. All of my posts can be found in the “Blog” button at the top left. Also, I categorize all posts in the ‘Category’ section to the right of the web page. You should see these on this page. Also, feel free to leave comments and suggestions at the bottom of the page.
Since its mid-year and there is a lot of uncertaintly in where taxes are going due to the sunset of the 2001 tax law, I am going to deviate from taxes for the most part in this newsletter. As Congress and the Administration act on taxes in the future I will surely keep you up to date on the goings on.
A government big enough to give you everything you want, is strong enough to take everything you have.
With everything that is going on here in the United States and the world, there are so many things to write about and talk about. There is much uncertainty in whats coming around the bend relating to taxes (except we know they are going to be higher), the stock market and investing, retirement, Social Security, pensions, the value of our currency, and the coming of rising interest rates and inflation.
The question is, where to start. Well, its mid-year already so maybe the best place to start is to take stock and inventory of where you are financially. Make a list of your assets and liabilities. Sketch out a budget. These two items will give you a good look into your ‘financial health.’ Its like an annual physical except it is for your finances. For a downloadable Excel Home Budget worksheet CLICK HERE.
Take a good, honest look. Are your assets more than your liabilities? Is you income more than your expenses, or is it the other way around? Are you able to save some money each month? What is your investment mix? I believe the stock market is vulnerable to what could be a large drop, so I think it’s imperative to thoroughly review every account you have to see what you are invested in and is it the proper mix for safety and growth.
How about your real estate holdings? Is the value more or less than the mortgages? Are you carrying an adjustable rate mortgage (these could turn out to be financial suicide)? Rates are low now so, even though loans are harder to get, this is the time to look at the possibility of refinancing to a fixed rate.
What kind of debt load are you carrying on credit cards, car loans, and other installment loans? Depending on one’s situation, there may be ways to lower the interest rate, lower the payments, do a settlement offer to get rid of the loans completely, or in the worst cases, considering bankruptcy. I know these are’t the most comfortable things to think about, but struggling to pay unsecured loans in a tight situation is extremely stressful and could be downright unhealthy.
The sovereign debt crisis in the U.S. and the world will cause our economies to evolve, but not without stress and pain on most of us. We will need to go on an austerity plan as many European nations are presently implementing. Please see my post called “How Did We Get Into This Mess Anyway?” for my take on what is happening and how it happened. It’s not meant to scare you, just an eye opener so you’re not caught off-guard.
If you find yourself in a precarious position; negative cash flow, over-the-top in debt, job loss, heavily weighted in vulnerable stocks or bonds, no retirement accounts, and the like, let this be a wake up call to take the bull by the horns and chart a new course and protect your investments.
What Else Can We Do?
If you are an employee, take the attitude that you are in business for yourself. That’s right, act like an entrepreneur. Always be looking for ways to improve not only your work position, but also look for ways to improve the company as a whole. When an employer or manager has someone on board that seems to care about the company as much as they do, that person becomes a valuable asset. If a time comes to cut costs, chances are your job will not be on the chopping block.
If you are an entrepreneur in business for yourself it may be time to change the way you do business. In turbulent times a lot of business owners retract. “Things are tough out there” they say. Many will cut back on costs like employees and even advertising. This presents opportunities for you to step up your business, your service, your contact with the buying public. It’s time to work on your business instead of in your business.
In my business coaching programs I teach my clients how to go to work on their business, to create a turn-key operation, to see hidden assets in their business, how to inspire their people, create their ideal marketing plan and more. If your business is experiencing a ‘slow period’ it’s the perfect time to work on your business. If your business is doing well, it’s a great time to take your company to the next level.
We cannot leave our futures to chance. The Washington Post recently reported a study saying that coming retirees have between 40 to 60 percent chance of depleting their savings after only ten years of retirement. Won’t Social Security save us? I can’t believe I even wrote that! Within six short years Social Security is expected to pay out more than it takes in. Not very comforting.
And remember that if you need advice or assistance in your financial checkup and subsequent action plan, all me at (805) 264-3305. I am here for you.
It is also a good time for a Mid-Year Tax Checkup. Has anything changed for 2010 that may affect your tax situation? More income, less income, bought a home, sold a home, laid off, retired, a retirement distribution, a second job, new baby, a child in college, a child no longer qualifies as a dependent, started a business, sold a business or ? Any of these could affect your 2010 taxes.
Company Health Insurance Taxable? If you have gotten any of those emails saying that your company plan health insurance is now taxable because they are required to be reported on your W-2 at year end, fear not. This is reported on the W-2 for informational purposes only, it is not taxed.
The First-Time Homebuyer Credit closing date has been extended to September 30, 2010. The qualifying home must have been under contract by April 30th.
Payroll Tax Holiday – Employers don’t forget if you have qualified employees you can take advantage of the ‘Payroll Tax Holiday” under the stimulus. If you’re not sure if you have qualified employees, CLICK HERE
Please feel free to contact me or leave comments. And don’t forget, there is a lot of good information available at www.SolvangTax.com
Robert W. Craig, E.A. Tax and Business Services
1444 Aarhus Drive, Solvang, CA 93463
Telephone: (805) 264-3305
Fax: (805) 617-1879
Website: www.BobCraig.biz and