How To “KonMari” Your Finances

Josh Cleveland and The Cedar Street Band

Borrowing from the wildly popular “KonMari method” of getting your life organized, getting your financial affairs in order may start with getting rid of any unnecessary documents that may be cluttering up your life.

While very few financial documents may spark actual joy to your life, I suggest saving only those documents that may have some value in the future. Shred the rest.

Shred It

On May 7th, Focus Financial hosted its 5th annual shredding event in which clients can bring their personal documents to be shredded by a professional shredding company.  Shred-it of MN provides “secure document destruction” services to over 300,000 customers around the world, as well as community Shred-it events like the one we are hosting.

To learn more about hosting a Shred-it event for your business or organization, read this blog post.

Some tips on what documents to keep and what you should destroy.

Keep forever. This is by no means a comprehensive list, but the following documents should be kept in a secure place forever.

  • Birth and death certificates
  • Social security cards
  • Pension plan documents
  • ID cards and passports
  • Marriage license
  • Insurance policies
  • Wills, living wills, power of attorney, and other legal documents
  • Titles to vehicles you own
  • House deed and mortgage documents

Tax returns. Most experts recommend keeping your tax returns for up to seven years. However, once your return is organized and stored in a safe place, I say keep it forever. Odds are your tax returns aren’t taking up that much space. Besides, there are some situations in which the IRS can go back and audit you indefinitely.

For a more detailed list of what documents to keep and for how long, check out this article by Consumer Reports.

Mike Branch with Tom and Carole Griffith, clients since 1993

The Focus Financial Shred-it event has also become a fun opportunity to spend time with clients in a fun and decidedly non-work atmosphere – Able Seedhouse + Brewery, in this case.

Food, beer, good music and the promise of a more organized financial life, is there a better way to spend a nice spring evening?

Feed My Starving Children Mobile Packing Event

Volunteers pray over a box of MannaPacks assembled by members of Incarnation Lutheran Church in Shoreview, MN

For the past several years, in lieu of a traditional holiday gift like cookies or popcorn, I have made a financial contribution to Feed My Starving Children (FMSC) in honor of you, my client.

When I can, I also try to attend a packing event so that I can literally have a hand in the process of making this gift possible.

This past week our church, Incarnation Lutheran Church of Shoreview MN, packed over 780,000 meals at our annual FMSC Mobile Packing event. That’s enough to feed over 2,088 starving children around the world for an entire year!

One of the things I love about Feed My Starving Children is that FMSC is a living example of the miracles that can happen when enough people work together, for a common purpose, contributing what they can, over a long period of time.

Since their inception in 1987, FMSC has delivered over 2 billion nutritionally complete meals to starving children around the world. 90% of the financial donations they receive go directly toward feeding children.

To learn more about FMSC mobile packing experience, watch this video.

Whether you provide financial support to FMSC, contribute your time to a packing event, or support businesses and others who do so, you have been a part of this miracle as well.

Thank you so much.

Does Your Credit Score Affect Your Car Insurance Premium?

Not long ago my car insurance agent called to let me know that I may be eligible for a discount on my insurance rates due to my “excellent credit”. This was a little surprising to me since it had never occurred to me that my auto and homeowners insurance premiums were based, at least in part, on my credit rating.

Apparently, however, this is a thing.

One landmark study found that credit-based insurance scores are used by about 95 percent of all auto and home insurers in calculating the cost of insurance to individuals.¹

While the vast majority of insurance companies use credit-based insurance scores to help determine the price of insurance, it is banned in the states of Massachusetts, Hawaii, and California. Some states only allow it as a factor for property insurance like auto and homeowners insurance. Other states allow it to be used with any type of insurance.

Several Factors

Generally, an insurance company will use a credit-based insurance score as just one factor in its underwriting process. Other factors may be considered, depending upon the type of insurance. For example, with auto insurance, other factors could include your zip code, the age of the drivers, the make, model and age of the car, and the number of miles you drive annually.

The use of credit scores to determine insurance rates is rooted in research that has shown individuals with lower credit scores had higher car insurance losses and higher claims payouts.

You can ask your insurance company if a credit-based insurance score was used to underwrite and rate your policy, and in which risk category you were placed.

If you want to improve your credit-based insurance score, you should consider taking the same steps you would to improve your credit rating: make timely debt payments, clear up past disputes and keep credit card balances low.

  1. Predictive Analytics: Achieving Greater Decision Accuracy, Better Risk Segmentation, and Greater Profitability, Fair Isaac Corporation, 2012 (most recent statistics available).

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG, LLC, is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright 2019 FMG Suite.

Social Security: The $64,000 Question

Photo by Sharon McCutcheon on Unsplash

Photo by Sharon McCutcheon on Unsplash

One of the most common questions people ask about Social Security is when they should start taking benefits.

This is the $64,000 question. Making the right decision for you can have a meaningful impact on your financial income in retirement.

Before considering how personal circumstances and objectives may play into your decision, it may be helpful to preface that discussion with an illustration of how benefits may differ based upon the age at which you commence taking Social Security.

As the accompanying chart reflects, the amount you receive will be based upon the age at which you begin taking benefits.

Tax Planning for 2019

Photo by Kelly Sikkema on Unsplash

How did you do with your 2018 tax bill? Did you pay more or less tax in 2018 than you did in previous years?

Whether you were a beneficiary of the 2017 Tax Cuts and jobs Act or not, now is a good time to begin tax planning for the year ahead.

Below are 5 ideas to help you pay less tax this year.