How Is Your Financial Advisor Paid?

I have chosen to work as a Fee-Only FInancial Planner because I feel it is the most objective way to give financial advice. I have taken the Fiduciary Oath. Evergreen Financial Planning provides financial and tax advice on an hourly-as-needed based.

Commissioned Professionals: If you aren't sure how your Financial Advisor is getting paid, chances are thy are earning commissions. Your broker or insurance professional earns a commission whenever they sell you a stock, mutual fund, annuity or one of the many products that trigger a sales charge. Sounds like a conflict of interest to me!

Fee-Based Advisors: Fee-based professionals also receive monetary reward for the products they sell. With fee-based accounts, brokers can charge customers a flat fee or a percentage of the value of the account. Sounds like a conflict of interest to me!

Fee-Only Advisors: A Fee-Only Financial Planner does not sell securities or insurance. There is not the conflict of interest which exists with the other types of "advisors" because recommendations for investments are not made based on the size of the commission. The fee-only advisor works for you.

AUM: Some advisors charge a fee for Assets Under Management. They are compensated by charging a percentage of the market value of the assets they manage on behalf of their clients

What is a Fiduciary?

The five core principles of the authentic fiduciary standard say it well. They are:

• Put the client's best interest first;
• Act with prudence; that is, with the skill, care, diligence and good judgment of a professional;
• Do not mislead clients; provide conspicuous, full and fair disclosure of all important facts;
• Avoid conflicts of interest; and
• Fully disclose and fairly manage, in the client's favor, unavoidable conflicts.

Garrett Planning Network Endorsed by Motley Fool

I’m writing to let you know about an exciting new development in my business. The Motley Fool has exclusively endorsed and is promoting the services of financial advisors affiliated with the Garrett Planning Network, the international organization of fee-only financial advisors with which I am proud to be associated.

The Motley Fool has long admired Garrett’s approach to fee-only financial advice. And we are fans of The Fool’s approach to everything they do to educate, empower and amuse the public and their members about investing. Garrett, The Motley Fool and I share a commitment to make trustworthy financial advice accessible to everyone.

The Motley Fool is one of the most admired financial brands in the world. Each month, 4 million unique visitors visit its website at Fool.com. At the core of The Fool’s business model are hundreds of thousands of premium members—many enjoying subscriptions to multiple investment newsletters. Clearly, the company is fulfilling its quest to broaden access to winning financial advice, and I am delighted to have access to all of these resources through our partnership with The Motley Fool. (If you’re not familiar with The Motley Fool, please find some additional information below.)

While there’s no doubt that The Motley Fool’s advisory services are answering a great need among individual investors, the company came to recognize that many of its members yearn for more hands-on help managing life’s complex financial decisions—especially in light of the recent rollercoaster stock market. The Fool decided it was time to look at expanding into the direct financial advice category.

Rather than building a financial advisor network from scratch, The Fool kicked off a search for a well-established, like-minded outfit with similar values with which to partner. I am delighted that they found a new match in an old friend—the Garrett Planning Network! As we know well, when it comes to financial planning, Garrett advisors offer the same kind of trustworthy, transparent, and community-driven advice that The Fool has built its business on. The Garrett-Motley Fool relationship has the makings of a great partnership.

Thanks for reading, and thanks for your support. Please don’t hesitate to contact me with your questions.

Sincerely,

Teri Tornroos

About The Motley Fool

Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king—without getting their heads lopped off. For more information please visit http://www.fool.com/.

About the Garrett Planning Network

The Garrett Planning Network is an international organization of like-minded fee-only financial advisors whose mission is to help make competent, objective financial advice accessible to all people. For more information please visit http://garrettplanningnetwork.com/

Will it matter where you retire?

Did you realize that states treat social security or pension income differently?

Check out this site by Kiplinger for a list of the states that are much more tax friendly for retirees:
http://www.kiplinger.com/tools/retiree_map/index.html?map=12#anchor

2009 Tax Preparation Checklist

Need help gathering your tax documents? Check out our list to make sure you don't miss anything!

http://www.evergreenfinancialplanning.org/Evergreen_Financial_Planning/Client_Forms_files/Test%20Preparation%20Checklist.pdf

Year End Tax Tips

Get Organized -
If you haven't done it already, start a file for your tax documents. As you receive W-2s, 1099s , 1099bs and 1098s, you will have a place to file them. Do you have kids in college or in child care? Do you have medical bills? Have you kept your receipts for charitable donations? If the donations were non-cash do you have a detailed list attached to your receipt? Are you keeping track of mileage for charitable work or miles driven to medical appointments? For a complete list of items see Tax Preparation Checklist on the Client Forms page of our website www.EvergreenPlanning.org.

Adjustments to state withholding -
If you expect to owe state income taxes when you file your return next year, ask your employer to increase withholding of state and local taxes. This can be done by filing Form G-4, Georgia Employee's Withholding Allowance Certificate.
If you are self-employed or retired and are making quarterly estimated tax payments, be sure to pay the State fourth quarter estimated tax payments before year-end to pull the deduction of those taxes into 2009.

Adjustments to federal withholding -
If you face a penalty for underpayment of federal estimated tax, you may be able to eliminate or reduce it by increasing your withholding. In this connection, it should be stressed that the Making Work Pay Credit, which was enacted earlier this year, automatically lowered tax withholding rates for employees. However, you should especially review your withholding to ensure that enough tax is withheld if you hold multiple jobs, you and your spouse both work, or you can be claimed as dependent by another person.
If not enough tax or too much tax is being withheld, you should give your employer a new Form W-4, IRS Employee's Withholding Allowance Certificate.
If you are receiving a pension, withholding can also be adjusted by sending Form W4-P, Withholding Certificate for Pension or Annuity Payments, to your pension payer.

Fee-Only Financial Planning Blog: Year End Tax Tips

Fee-Only Financial Planning Blog: Year End Tax Tips

Year End Tax Tips for Employees

Employees have some special considerations to take into account that retirees and other nonworking individuals don't face. To help our clients who are employees take advantage of these special tax saving opportunities, we have put together a list of items to consider. Please review the list and contact us if you need additional information on one or more of the items.

Health flexible spending accounts -
Many employees take advantage of the annual opportunity to save taxes by placing funds in their employer's health flexible spending account (health FSA). You save taxes because you use pre-tax dollars to pay for medical expenses that might not be deductible.
If you have set aside funds in your employer's health FSA, check your balance so that you have sufficient time to incur additional reimbursable expenditures to prevent loss of any unused amount under the use-it-lose-it feature of these plans. Don't forget you can get tax-free reimbursements for aspirin, antacids and other over-the-counter items. Your plan should have a listing of qualifying items and any documentation from a medical provider that may be needed to get a reimbursement for any such items.
Examining your year-to-date expenditures now will also help you to determine how much to set aside for next year. Don't forget to reflect any changed circumstances in making your calculation.

Dependent care FSAs -
Some employers also allow employees to set aside funds in dependent care FSAs. They allow employees to use pre-tax dollars to pay for dependent care. In particular cases, participating in a dependent care FSA can yield greater tax savings than foregoing participation and claiming a dependent care credit. Taxpayers who are eligible to participate in a dependent care FSA and are (a) in a high tax bracket and/or (b) have only one dependent and more than $3,000 of employment-related expenses, should use the FSA to pay for child care expenses. For these taxpayers, the FSA almost always provides greater federal tax savings than does the credit.
However, like health FSAs, dependent care FSAs are subject to the use-it-or lose it rule. Thus, now is a good time to review expenditures to date and to project amounts to be set aside for next year.

401(k) contributions -
Review and make appropriate adjustments to your contributions to you employer's 401(k) retirement plan for the remainder of this year. Figure your contribution rate for next year as well.

Year End Tax Tips

Get Organized -
If you haven't done it already, start a file for your tax documents. As you receive W-2s, 1099s , 1099bs and 1098s, you will have a place to file them. Do you have kids in college or in child care? Do you have medical bills? Have you kept your receipts for charitable donations? If the donations were non-cash do you have a detailed list attached to your receipt? Are you keeping track of mileage for charitable work or miles driven to medical appointments? For a complete list of items see Tax Preparation Checklist on the Client Forms page of our website www.EvergreenPlanning.org.

Adjustments to state withholding -
If you expect to owe state income taxes when you file your return next year, ask your employer to increase withholding of state and local taxes. This can be done by filing Form G-4, Georgia Employee's Withholding Allowance Certificate.
If you are self-employed or retired and are making quarterly estimated tax payments, be sure to pay the State fourth quarter estimated tax payments before year-end to pull the deduction of those taxes into 2009.

Adjustments to federal withholding -
If you face a penalty for underpayment of federal estimated tax, you may be able to eliminate or reduce it by increasing your withholding. In this connection, it should be stressed that the Making Work Pay Credit, which was enacted earlier this year, automatically lowered tax withholding rates for employees. However, you should especially review your withholding to ensure that enough tax is withheld if you hold multiple jobs, you and your spouse both work, or you can be claimed as dependent by another person.
If not enough tax or too much tax is being withheld, you should give your employer a new Form W-4, IRS Employee's Withholding Allowance Certificate.
If you are receiving a pension, withholding can also be adjusted by sending Form W4-P, Withholding Certificate for Pension or Annuity Payments, to your pension payer.