The latest on the blog:

The Red Dot Talk

All of our clients have heard this talk and many of them have heard it several times. This chart is from the JP Morgan Guide to the Markets and we’re going to pull two lessons from it. The first thing on this chart is the bars and what they represent is what the S&P 500 did each year.  You’ll see that these bars are all over the place and there is no pattern. We need to agree on the fact that nobody knows what the next bar is going to be.  If you look at longer periods of time – rolling 3 year, 5 year, 10 year periods – your odds of success increase tremendously. The second thing on this chart is the red dots. What are these red dots?  They are the low point of the S&P 500 every year.  You’ll see that they are ugly and they are negative every year.  If you average the red dots they are close to -15% so on an average year you can expect to be down 15% and sometimes much worse. What do we do on a red dot?  We’ve got to agree upfront that the smart thing to do is

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Time Value of Money

This is a little sample from the Finance 101 meetings that we do with our client’s children. Young adults need to learn about money and investing – this story is about the time value of money. There are two people in this story: Joe Early and Joe Everybody. Joe Early starts early – 22 years old and putting away $2,000 per year ($166 per month) for eight years and he stops.  A total of $16,000 is all that he put away.  And we are giving him a really good investment that does a 12% return per year. The other guy, Joe Everybody, waits until 30 to start saving the same $2,000 per year and he goes all the way until age 65 saving a total of $72,000. So Joe Early saves $16,000. Joe Everybody saves $72,000. Same exact investment returns.  What happens? Joe Early finished with over $1.6 million. Joe Everybody, even though he put away a lot more money, never catches up.  He’s got just over $1 million and still did great but $600,000 less than starting early. Now the early guy is sharp, he’s not going to stop at 30.  He’s going to keep putting away the $2,000

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Section 179 Deduction: Writing off your Company Vehicle

What is the Section 179 Deduction? The Section 179 deduction is a tax deduction made available to business owners that purchase certain types of business property.  These purchases include vehicles for business use, equipment, office furniture, supplies and other tangible items.  Even ownership in a plane can potentially qualify for the Section 179 deduction. Using the Section 179 deduction you are able to accelerate the depreciation on the qualifying item potentially all into the year that the purchase was made.  For business owners making purchases of qualifying property this can have powerful tax implications. How to Qualify for the Section 179 Deduction When it comes to purchasing a vehicle, there are a number of considerations you should be aware of when utilizing the Section 179 deduction. The vehicle must be bought and placed into service the year that the Section 179 deduction is taken.  The vehicle must be used at least 50% for business purposes and the deduction proportionately to its business use. The weight of the vehicle purchased will impact the dollar amount that can be deducted using Section 179. Heavy Section 179 Vehicles Vehicles with at least 6,000 pounds of GVWR but less than 14,000 pounds qualify as

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