Tax planning is like exercise: You may not always be motivated to do it, but once you’re tackled the task, you feel so much better. (And fortunately for everyone, you don’t need to do tax planning several times a week, consistently, to see a lasting benefit.) I’ve asked Matt Grodin, a San Mateo certified public accountant, to answer three taxing questions:
What are some of key changes in the federal tax law that will affect Bay Area taxpayers?
There’s a $10,000 limit on deductions for state taxes and a $750,000 limit for deductions on new mortgage debt. Previously, home buyers could deduct up to $1 million. As you know, home prices in the Bay Area keep rising to new heights—the median home price hit $820,000 in April—so any restriction on mortgage deductions isn’t exactly good news. (more…)
Not that long ago, retirement meant being put out to pasture, with long days punctuated by occasional games of golf and bridge. But today, with lengthening life expectancies and dwindling pensions, many Americans are looking to retirement as an opportunity to start a new business. “We’ve never before seen so many seniors who are this active and doing so many things,” says Lisa Gundry, a professor of management at DePaul University’s Kellstadt Graduate School, who has worked with seniors in DePaul’s business incubator program. “They’ve accumulated enough financial security so that they are better able to take a risk on a business than someone who is younger and has a mortgage and small children.” (more…)
Our attitudes and beliefs about money have their roots in value-laden messages we have picked up along life’s journey. These money messages are not only clothed in the words of others, but in their actions as well.
The following paragraphs include a series of questions designed to jog your money memories. To gain insight into your financial beliefs and behaviors, look first to your childhood experiences.
In your home growing up, was there an atmosphere of plenty or scarcity? How did your parents and grandparents demonstrate their money beliefs? Did the adults in your life demonstrate responsible or irresponsible money management behavior? (more…)
For many years, the prevailing theory was that individuals have a genetically determined happiness set point.
In other words, scientists believed that each person could temporarily experience more happiness (depending on circumstances, relationships, and life events), but would then slide back to his or her “pre-programmed” set point. In fact, less than two decades ago, one researcher was quoted as saying, “It may be that trying to be happier is as futile as trying to be taller.” (more…)
Getting people to feel less stressed when thinking, talking, and making decisions about money is the goal of Financial Therapy; a combination of psychology and financial advice that is focused on developing healthy relationships with money.
While a financial counselor usually comes in at a point of crisis—like bankruptcy or intractable financial conflicts between spouses—the role of a financial therapist is to help us understand the stories we tell ourselves, true or not, about money. These “money scripts” usually reside outside of our consciousness, and act as an invisible force guiding our thoughts, feelings, and decisions about money. (more…)