“There are two things to aim for in life: first to get what you want and after that,
to enjoy it. Only the wisest of mankind achieve the second.”
– Logan Persal Smith
Investment Management FAQ
CFP® means CERTIFIED FINANCIAL PLANNER. CERTIFIED FINANCIAL PLANNERTM
practitioners are required to complete coursework in five different content areas
which include: retirement, insurance, estate, investment, and tax planning. Read More
IRA
What is an IRA?
An Individual Retirement Account (IRA) is an IRS approved individual savings account which provides for either tax-deductible and/or tax-deferred growth. Traditional IRA's may be tax-deductible subject to income limits.
Roth IRA's are not tax-deductible; however, they provide tax-deferred growth and tax-free distributions. They are also subject to income limits, though generally these are higher than for traditional IRAs.
IRA Limits
What are the contribution limits to an IRA?
The 2012 contribution limit for both traditional IRAs and Roth IRAs is $5,000. Individuals, who will be 50 or older, may contribute an additional $1,000 "catch-up" for a total of $6,000.
Your contribution amount will vary depending on your income and type of IRA. Please call Sharkey, Howes & Javer and we would be happy to assist you, as the rules have changed recently.
401k
What is a 401k?
A 401(k) plan is an IRS approved tax-deferred payroll savings plan sponsored by an employer. Most 401(k) plans may provide for additional employer contributions, such as matching and profit sharing options. Employees contribute either a fixed dollar amount or a percentage of each paycheck as a salary deduction to their 401(K) account. Plans offer a wide variety of investment choices ranging from conservative to aggressive options.
401k Rollover
Why and when should I rollover my 401k and how do I do it?
A 401(k) plan is an IRS approved tax-deferred payroll savings plan sponsored by an employer.
Most 401(k) plans may provide for additional employer contributions, such as matching and profit sharing options.
Employees contribute either a fixed dollar amount or a percentage of each paycheck as a salary deduction to their 401(K) account.
Plans offer a wide variety of investment choices ranging from conservative to aggressive options.
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401k Limits
What are the contribution limits to a 401(K)?
The 2012 salary deferral (contribution) limit is $17,000, indexed for inflation. Individuals, who will be age 50 or older in 2012, may contribute an additional "catch-up" of $5,500 for a total of $22,500.
The best way to find a Retirement Planner that you can trust is to seek a referral
from a friend or associate who is happy with and being well-served by the person
he or she is working with. When selecting a financial advisor look specifically for someone
who is a Certified Financial PlannerTM Practitioner and has a fee-only
business model. Read More
Under limited circumstances you can withdraw money from certain accounts and avoid
the 10% early withdrawal penalty. It is important that you work with your Certified
Financial PlannerTM or tax accountant to confirm that you qualify for
one of the exceptions prior to taking a distribution. Read More
Asset management is done by carefully allocating your investments among many different asset
classes to provide you with investment diversification. Your portfolio is carefully
monitored and quarterly reports are sent to you to update you on the performance
of your portfolio.
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Investment Management
What type of investments do you use?
We primarily use no-load mutual funds, some individual stocks, bonds and Exchange Traded Funds (a mutual fund that trades like a stock).
How often do you review my portfolio?
Your portfolio is reviewed at least three times per year to make sure it is line
with your designed allocation. We will also review your portfolio when you deposit
or withdraw cash, if we change the overall allocation, or if an investment in your
portfolio no longer meets our criteria.
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The planner you select to work with is responsible for selecting appropriate investments
for your portfolio from a list approved by Sharkey, Howes & Javer's investment committee.
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Retirement Plan
When can I retire?
When you have enough money to meet your long term goals. Of course the age you can retire is contingent upon a number of factors such as life expectancy, the level of income desired during your retirement, your current age, the amount of money you have saved, future inflation rates, projected investment returns and the amount of money you plan to contribute to your retirement fund/401(k).
How often do you buy and sell assets?
We generally sell investments when they no longer meet our investment criteria or
your needs. The proceeds are normally invested in a suitable replacement. Furthermore,
throughout the year and at year-end in taxable accounts, we will harvest tax losses
if available, as well as evaluate the impact of capital gains distributions on your
portfolio, possibly avoiding such distributions if necessary.
Do you require discretion over my investment accounts?
Yes, we do require discretion over your investment accounts. When you first meet
with us, we will provide you with a recommended portfolio for your review and
approval. When changes are required, we need to make these changes as quickly as
possible. To do this effectively, we require discretion to properly manage your
account. Your custodian (Charles Schwab or TD Ameritrade) will send trade
confirmations of any changes we make for you.
When my account goes down, do I still pay you?
Yes, whether the markets are moving up or down, we are working diligently to manage your money. Your accounts may decline because we have set up a program for you to withdraw funds systematically from your account or because of adverse market conditions. We want your accounts to grow, however we also want to protect your investments in a down market; therefore, we make sure your investments are properly allocated and diversified. We are here to advise you for the long run.
What is your "team" approach?
Every client has full access to all of the firm's resources. Although, a client
may select a "primary planner," all planners are involved in helping the client
achieve his/her financial goals. Clients may request to work with any of our planners
at any time.
What retirement plan is best for my business?
The type of business you are in and your goals and objectives will determine the retirement plan most suitable for your business. Your company's demographics will also factor into which retirement plan is most appropriate, including the average age of your workforce, salaries, etc.
Yes! Sharkey, Howes & Javer, has dedicated professionals who work with individuals and corporations to set up or improve existing 401(k) plans. Scott Brookes, Director of Retirement Plan Services, will help you set up or review your 401(k) plan. Call Scott, at 303.639.5100 to discuss any retirement plan design questions you may have.
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The amount of life insurance you need depends on the promises you have made or wish
to make to your loved ones. We can determine exactly what amount of life insurance
you will need to fulfill these promises. Read More
What other forms of insurance are most useful to me?
Other forms of insurance that may be useful to you include, but are not limited
to: disability, long-term care, health, liability, home and auto. Having adequate
coverage in each area is an important part of staying on track to meet your financial
goals.
What estate planning documents do I need?
The estate planning documents you need depend upon your specific circumstances.
However, most estate planning documents generally include a will, trust(s), medical
directives, durable powers of attorney, and HIPPA documents. It is advisable to
work with an estate planning attorney to draft the appropriate estate planning documents
you require.
How can I save on income taxes?
Taxes can be saved in a variety of ways ranging from simple measures such as, reviewing
allowable deductions, gifting appreciated stock, maximizing contributions to an
IRA or a qualified retirement plan, to more complicated strategies such as reviewing
your business structure or employing family members.
The best college savings vehicle in place today is a 529 College Savings Plan. The
State of Colorado has an excellent one. In addition, there are Coverdell Education
Savings Accounts, custodial accounts and other accounts that can be useful when
saving for college. Read More
How can I prepare for college funding?
Start saving for your children's college education as early as possible. You will
need to determine what type of college you would like your children to attend and
how much of the cost you are willing to support. Two to three years prior to your
child starting college, you need to learn about FAFSA (Free Application for Federal Student Aid), and college
funding from federal sources, state sources, and scholarship programs. Do not pay
for scholarship search engines. They are free. Visit our college planning page or call us at 303.639.5100 and for
a list of Internet resources that can be used in your research.
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Who will I be working with?
The person scheduling your initial appointment will set your appointment with
the planner that best fits your needs. However, you have the option of choosing
the planner with whom you would like to work with. At SHJ we work as a team,
which ensures that all of your planning needs are met. Our primary goal is to
provide you with the best client service possible.
Sharkey, Howes and Javer, is a fee-only financial planning firm. Fee-only means
that we accept compensation only from our clients – not from any other source. In
other words, our clients are the only people we allow to pay us. Read More
In the first year we recommend meeting three or four times. Thereafter, we allow
you to determine how often we meet. For some people, annual or semi-annual
meetings are sufficient, while other people prefer quarterly meetings. We can
meet in person or by phone. The bottom line is, if you feel the need to talk
with us, call us and schedule a meeting. If we need to talk to you, we will call
or email you to set up a meeting to discuss your situation.
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The fee for financial planning typically ranges from $250 to $2,500. The amount
of the fee is driven by your specific financial planning needs. The annual fee for
investment management of up to $1million is 1% of the assets we manage on your behalf.
It is billed quarterly, in arrears. Read More
As financial advisors, it is important to us that you accomplish your goals. Consequently,
the quarterly reports and planning updates we provide are designed to show you where
you stand on the road to meeting you goals. Read More
How do we get started?
Once you have contacted our office we will gladly send you our information packet.
This packet includes the biographies of our financial advisors, a fee schedule and
a confidential questionnaire. When you are ready to set you complimentary appointment,
please call 303.639.5100 or Contact
Us.
Are you accredited by the BBB?
Yes, we are accredited by the Better Business Bureau. Click here for review.
What is the Fiduciary Difference?
A Fiduciary places the interests of the client in front of their own. This entertaining video compares brokers to butchers and fiduciaries to dieticians; the one sells you a choice cut of meat, the latter sells advice on a healthy diet. Don't ever ask the butcher if you really need a juicy pork chop in your diet.
Information presented is not designed to be tax, legal or investment advice and
is subject to change at any time. All investments contain risks, including the loss
of principal. Past performance is no guarantee of future results. Consult with Sharkey,
Howes & Javer to learn more about the strategies and information presented herein.
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