4 Helpful Ways to Know You Have Enough Money for Your New Home

Home owner pictureMy husband and I are in the process of buying a new home and, wow, what a process it is!  While it’s been a lot of fun, I feel like every time we turn around someone is trying to convince us we need the latest and greatest, most popular bells and whistles for our new house. “Sure,” they imply, “you can keep up with the Jones’, too!”

Thanks to my 12 years of experience in the financial services industry, Rob and I agreed on some rules of thumb before we started looking at homes. But this got me to thinking, how does the average home buyer who hasn’t held their clients’ hands through this process a gazillion times get started?  Luckily, it doesn’t have to be overwhelming.

Here are 4 helpful tips you should consider to set yourself up for home ownership bliss:

  1.  Compare your bills to your income. Your minimum required debt payments should total no more than 36% of your monthly gross income (that’s your paycheck before taxes are taken out). This includes your new mortgage payment, credit card balances, automobile loans and leases, and debt related to other lifestyle purchases. If all of these add up to over 36% of your income, avoid taking on additional debt.
  2. Don’t forget about other housing expenses. As a general rule, your monthly housing costs, including your mortgage, home insurance, real estate taxes, association fees, and other monthly home expenses, shouldn’t be more than 31% of your monthly gross income.
  3. You need a backup plan. What would happen if you suddenly lost your job or had a major health issue?  Until you save enough money in cash to cover your total expenses for 3-6 months, including those costs associated with your new home, you should wait. Cash is the first step to making sure a financial setback won’t cause you to crash and burn.
  4. A variable-rate mortgage may not be worth the risk. Because the monthly payments are typically lower with variable-rate mortgages, they are generally the easiest to qualify for—and may enable you to purchase a more expensive home. But, keep in mind that it’s typically not wise to take on a variable-rate mortgage simply because you qualify for one. Although these mortgages offer the lowest interest rate, they’re also the riskiest, as the monthly payment can increase to an amount that may prove difficult to meet down the road.

My name is Valerie Leonard and I am a financial advisor who works with folks just like you every day to help them live comfortably for now and in the future. If you need an expert opinion on your situation, contact me and we can pursue your new home purchase together.

How to Join this Surprising Money Movement Now

Hand writing Time to Save on BlackboardMomentum is building. I’ve noticed a recent trend – people are asking me how they can save money. It’s like saving is popular again! It’s as if investing is back in favor. And rightly so. Consumer confidence is at a 13 year high. There seems to be more positive economic data here in the U.S. than we’ve seen in a long time. But most importantly, people are making more money and there are more jobs available than workers willing to roll up their sleeves and do the work.

So what does all this mean? This means you’ve survived the last decade of turmoil and you have an opportunity to get your priorities straight before your spending habits get out of whack. Imagine if you took every raise or bonus you got this year and put it to work toward your financial future. What would your bank account balance look like a decade from now? Would you be in a better position to live out your dreams or survive another downturn in the economy? Yes, you likely would!

Join the movement. Contact me if you’re interested in making the most of your most valuable asset – your hard earned income. I’d love to help you live a life on the north side of average!

How to Use Your Business to Reduce Your Tax Pain


Have you ever wondered what other creative business owners are doing differently to defer taxes and save for retirement? No, I’m not talking about a 401(k), SIMPLE IRA, or a SEP. I’m talking about a plan that affords you the opportunity to take advantage of large tax and retirement limits that aren’t typically available in traditional retirement plans.

If you haven’t heard already, you need to know about the cash balance plan, a defined benefit retirement plan designed for accelerated tax-deferred savings. For instance, in 2016, a 40-year-old employee could defer as much as $80,736 into a cash balance plan on top of their $18,000 deferral to a 401(k) plan. In essence, it allows this employee to pack away $98,736 in 2016 when a traditional defined contribution plan would have only allowed for a $53,000 contribution. The older the employee, the higher the maximum contribution. At age 50, an employee could contribute as much as $155,908 to a cash balance and 401(k) plan combined compared to the $59,000 traditional defined contribution limit. Wow!

So how do you know if it’s right for you and your company? Here are 4 basic things to consider:

  1. Your owners or key executives want to defer more than $53,000 a year into their retirement accounts,
  2. Your business has demonstrated steady profits,
  3. You are willing to contribute three to four percent to employees, and
  4. Your owners are age 40 or older.

There is also a solo cash balance version for small, closely-held businesses.

My name is Valerie Leonard and I’m your not-so-typical financial advisor who works with people just like you every day to help find creative business solutions that others often miss. If you want to learn more about whether the cash balance plan could help reduce your tax pain and save for retirement, let’s chat. You’ll want to know all the facts before going down this road, but I’d love to show you how powerful this strategy can be when designed and optimized correctly.

Four Ways to Get Ahead in the New Year

2017-goals-photoLet’s look at how you can get ahead in 2017 by focusing on short, bite-sized goals that are easy to meet. Here are four things you can knock out today to set yourself up for financial success this year:

  1. Sit down and add up all the expenses you expect to have in the next 30 days. Take into account any spending money you may need and try to limit your discretionary spending for the next 30 days. Cut back on anything that is not necessary for the next month.
  2. Make a list of all your debt balance, minimum monthly payment amounts, and interest rates.
  3. Compare the income you expect to receive over the next 30 days to your expenses. Determine whether you expect to have any money left over once all expenses are paid. If so, plan to use the extra money toward your debt, focusing on the account with the lowest balance first. If you don’t have any money left over, see whether you can raise some money by selling something you no longer need, doing an odd job for someone, or taking on a second temporary job.
  4. Mark your calendar for 30 days from today to repeat this exercise. In the meantime, only worry about what you can do to take control of your finances for this month. Don’t overwhelm yourself by trying to look too far into your future. Seize the day!

As always, I am happy to answer any questions you may have.


4 Fundamentals for Protecting Your Assets in a Litigious World


Asset protection planning takes many forms for every type of individual, and isn’t always associated with multimillion-dollar offshore trusts.  Whether you’re concerned about bankruptcy, creditor, divorce, or an injury case, you should start by building a foundation of protection.

Here are 4 fundamental principles you may want to consider for yourself:

  1. The more protection you want, the more control you may need to relinquish. First, ask yourself two questions: Is there any chance that I may want this asset back on a rainy day? Am I willing to relinquish complete and total control over it? The more strings you attach to an asset you are giving away, the more likely it is that a creditor will be able to use those strings to obtain access to the asset.
  2. Timing is everything. The time to plan for asset protection is when no creditors are looming on the horizon. Although you may plan to protect assets from unforeseeable future creditors, strict rules, called “fraudulent conveyance laws,” protect the rights of present and foreseeable future creditors. The courts help shape the definition of such creditors on a case-by-case basis, and each state’s statutory time frame varies.
  3. The method of transfer matters. Do you simply want to give the asset away, or are you considering a more advanced strategy, such as an asset protection trust? More complex strategies may come with additional administrative rules, as well as ongoing costs.
  4. Federal and State laws can be tricky. The implications of federal and state laws on asset protection can be complex and depend on many factors, including the determination of exempt and nonexempt assets, who the creditor is, and the basis for the claim. On top of that, state-to-state variations in how federal and state laws overlay can complicate matters even further.

My name is Valerie Leonard and I have experience helping clients build a foundation for asset protection planning that includes determining the level of protection you need, insurance, estate planning, and advance transfer strategies. Together with your experienced attorney, I can help you develop a good asset protection game plan – one that you can understand, feel comfortable with, and incorporate into your total financial picture.   Contact me for more information.

The Toddler Conspiracy That Will Make You Want to Quit Your Job

The Toddler Conspiracy That Will Make You Want to Quit Your Job%0D

This weekend I feel like I was banging my head up against the wall.  Between the biting, spitting, kicking, sassy talk, willful disobedience and other tumultuous behavior that went on between my 5, 3, and 1 year old, it was enough to make any parent ask, “what am I doing wrong?”  My husband and I have always prided ourselves on applying consistent discipline in our home.  We were on the same page the entire week.  We unsuccessfully tried all the tactics that have worked in the past.  It was like one week ago our sweet little darlings turned into little rabid birds that wanted to peck our heads off.  So, naturally, I started asking the question, “would they act this way if I stayed home with them and gave them more attention all week?”  The conclusion God revealed to me yesterday honestly surprised me.

Let me start by saying, I have no intentions of becoming a stay-at-home mom.  It’s not that I don’t think my kids would benefit from having their mom by their side on a full-time basis.  Instead, it’s more about the fact I believe I’m a better parent because I work.  I realize this isn’t true for everyone.  In my case, I firmly believe that God called me to a career of helping people outside of the home and I’ve been able to use this talent to teach my kids lessons that they wouldn’t otherwise learn.  I know it will continue to be a challenge trying to juggle both, but I am resolved to use my career to help Americans live financially healthy and productive lives while simultaneously teaching my kids the same lessons.

In America today, 68% of mothers are working outside the home and statistics tell us that the number one emotion working moms struggle with is guilt.  I think guilt often comes from our own agenda.  We want to accomplish something, we envision our family lives looking a certain way, we see our friends or family doing things differently and we are envious, we lack forgiveness of ourselves for our past mistakes, we say to ourselves, “if I can just do x,y, and z then things would be different.”  As mommas who want the best lives for our families, we have to stop this nonsense.  There IS an easier way!

So what does God wants for me as a Mom?  The only way I can know for certain is by asking Him and seeking His truth.  I was reminded yesterday that God started making promises to those who choose His path way back in Genesis.  He fulfilled His promises when he sent His Son to pay the price of our imperfections.  He gave us an advocate in the form of His Holy Spirit who is filled with His very own power to live within us and give us wisdom.  So many times we rely on our own strength, our own ideas, or our own pride to get through the day.  In my life, He’s teaching me that I need to simply rest in Him.  He is enough.  My parenting efforts can only be done through His strength.  Thankfully, His truth frees me from dwelling on the failures of my day and my own self-pity and allows me to focus on the blessings that come through being a mom and wife.

So to you other working moms out there, don’t add any more stress to your life by beating yourself up.  You are not alone.  Parenting is a process and as long as we hold tight to God’s promises, we will succeed!


Source: U.S. Department of Labor, Employment Characteristics of Families Summary, 4/22/16

Securities and advisory services offered through Commonwealth Financial Network, Member www.FINRA.org/www.SIPC.org, a Registered Investment Adviser.  This communication strictly intended for individuals residing in the states of AL, FL, GA, KY, LA, MD, MS, OK, PA, SC, TN, TX. No offers may be made or accepted from any resident outside these states due to various state regulations and registration requirements regarding investment products and services.

How to Build a Simple Emergency Fund that will Help You Feel in Control

How to Build a Simple Emergency Fund that will Help You Feel in Control

If the water heater breaks down, you don’t want to be forced to beg or borrow just to make it through.  An emergency fund can be your first line of defense against months or even years of debt.  So how do you build one without giving up your ability to live life?  In my expert opinion, it all comes down to tricking your brain into making it easy.  Try these simple steps and you’ll be on your way to a sizable bank account and feel in control of your cash flow before you know it!

  1. Open an account at a bank on the other side of town – The first step to building a sizable emergency fund it to have a place to put money that’s out of sight and out of mind. In most cases, a simple checking or savings account will do.  Don’t be bothered by the frilly bells and whistles that banks can charge you.  You’re not even looking to invest this money.  The purpose of this account is easy access in case you need it.  Opt for the free version and keep it simple.
  1. Timing is everything – I strongly suggest a plan that includes emergency fund savings each time you get paid. If you get paid weekly, your emergency account should be funded weekly.  If you are paid bi-monthly, you should fund your emergency fund bi-monthly.  Since most people are living paycheck to paycheck when starting to set aside reserves, this strategy will help you eliminate the timing challenges that come with savings.
  1. Any amount will do when starting out – For the first month, I’d suggest just getting started. Don’t stress too much over how much you need to save each pay day.  Pick an amount that you can live with and go with it – even if it’s just $25 per paycheck.  You’ll most likely find that you won’t miss it and you’ll be able to easily increase the amount you save any time you want.  If you want to challenge yourself, that’s fine.  Just be careful not to overdo it.  It’s better to start small and increase from there than to start big and fail.
  1. Make it automatic – The most important part of the equation is to establish an automated link from your primary checking account to your new emergency fund account on the other side of town on the same day you get paid (or one day later).  Ask your primary bank if they can setup automated transfers to this new account or ask your employer if they can direct deposit an amount there each pay day.  If those aren’t options, ask your new emergency fund banker whether they can pull money into this new account from your primary checking account on their end.  If that doesn’t work, setup automated bill payments from your primary checking account on the same day that you get paid so that a check will be sent to your new bank on a regular basis.  Keep in mind that your plan has a high chance for failure if you are forced to manually transfer money or write a physical check each time your emergency fund needs to be funded.  You should opt to set it and forget it.
  1. Don’t look at your statements – Ok, ok, in good conscience I have to tell you to keep a watchful eye on your new account to be sure you avoid fraud, banking errors or unnecessary fees. But the bottom line is that the less frequently you look at the balance of this account, the more likely you are to let it accumulate without the temptation of touching it.  Put a note on the calendar to review it every six months and focus more on reviewing the amount you’re saving each payday than the total account balance.  Your goal is to set aside at least 3-6 months worth of money to cover your monthly expenses.  And another thing – try not to touch it even if you need it.  Look at this account as an account of last resort when things get tough.

My name is Valerie Leonard and I’m not your traditional financial advisor.  I want to help you feel in control of your money by using proven strategies that make it easy on you.  If you’re looking for a money mentor who can help you reach your goals, hold you accountable, and plan for the unknown, contact me today!

Securities and advisory services offered through Commonwealth Financial Network, Member www.FINRA.org/www.SIPC.org, a Registered Investment Adviser.  This communication strictly intended for individuals residing in the states of AL, FL, GA, KY, LA, MD, MS, OK, PA, SC, TN, TX. No offers may be made or accepted from any resident outside these states due to various state regulations and registration requirements regarding investment products and services.

How to Turn the Tables on Your Budget

How to Turn the Tables on Your Budget%0D

Ladies, it pains me to tell you that we are more confident in our ability to follow a budget than to invest our money and allow it to work for us.  A recent BlackRock study revealed that 61% of women follow a household budget but only 45% of women have investments.  What’s worse is that only 22% of women consider themselves as an investor.  So why are we so comfortable with saving money yet unwilling to get comfortable with a strategy for making it grow?  Here are four tips you can follow to turn the tables on your disciplined approach to budgeting and savings:

  1. Understand your risk – The risk of losing money is typically the number one reason why women choose not to invest. When you’ve heard a negative story from a loved one’s past experience you may be scared to dip your toes in the water.  However, keep in mind that your goal should be to build a portfolio that’s right for you and, in many cases, those bad stories were told by someone who was likely taking too much risk to begin with.  If you’re nervous, don’t lose sight of the fact that there are lower-risk investments that carry the potential to make you more than your savings account or CD at your local bank.  If you invest with the attitude that markets will be choppy, you have the option of building a more defensive portfolio that meets your needs.   My advice is to never take more risk that you are comfortable with and learn how different types of risk could actually affect you.
  1. Get educated – Another popular reason why I find women don’t invest is because they don’t even know what investing really means. It all seems so overwhelming – but it doesn’t have to be!  You should know the difference between a stock and a bond.  A stock is when you own a piece (aka, “share”) of a company.  The more shares you own, the bigger amount of ownership you have.  If the company you buy makes money, your stock price goes up and vice versa.   When you are buying a bond, you are actually loaning money to a company.  For instance, if you buy a bond for $1,000, you are handing over that money to the company with their promise that they will pay it back to you at a later date and, in the meantime, they will pay you a paycheck (aka, a “coupon payment” or “income payment”) until they return your money.  Now there are some more details you’ll obviously want to brush up on before buying a stock or bond, but it’s really not so difficult.  I can help explain these concepts to you and bring you up-to-speed on other things you’ll want to know if you’d like.
  1. Consider a systematic approach to investing – One of the easiest and most effective ways to invest is through a concept called “dollar-cost-averaging.” Don’t be intimidated by the name because it’s actually really simple.  The approach is to invest a fixed amount of money into an investment at regular intervals (like every pay period or every month).  By systematically investing the same amount each period you’ll spread your purchases over time, and your average buying price per share should be lower than if you had invested the money at one time.  This long-term strategy also takes much of the emotion and guesswork out of investing in the market.  It helps you avoid the most common mistake investors make by being tempted to jump in when the market is rising or selling out when the markets take a tumble.  Another plus is that it helps keep you on track toward meeting your long-term savings goals.
  1. Don’t set it and forget it – My grandparents used to use the “buy and hold” strategy and it really worked for them. These days, however, you must be looking at your investments and reviewing your strategy at least twice per year.  Markets move quickly and if you aren’t interested in keeping track yourself, you’ll need an expert advisor on your side who can do it for you.  I’m happy to review your current investments and give you some advice if you’re interested.

My name is Valerie Leonard and I’ve got a reputation for helping women invest using strategies that can help them reach their goals.  If you’re ready to learn more about gaining confidence and building an investment strategy that could help grow your money, contact me today.

Source: BlackRock Global Investor Pulse Survey, July/August 2015

Disclosure:  Dollar-cost averaging is not a foolproof investment technique. It does not assure a profit or protect against loss in declining markets. It involves continuous investment in variably priced units, regardless of price fluctuations. Investors contemplating the use of dollar-cost averaging should consider their ability to continue purchases over a period of time even when prices are low.

Securities and advisory services offered through Commonwealth Financial Network, Member www.FINRA.org/www.SIPC.org, a Registered Investment Adviser.  This communication strictly intended for individuals residing in the states of AL, FL, GA, KY, LA, MD, MS, OK, PA, SC, TN, TX. No offers may be made or accepted from any resident outside these states due to various state regulations and registration requirements regarding investment products and services.