Do You Have a College Savings Strategy?

Monday, May 29 is 529 College Savings Day. It’s a great time to get started saving if you haven’t already. Did you know that college tuition continues to increase each year, but over 60% of families don’t have a college savings strategy? I can help make sure you are prepared. Reach out to me and let’s talk about a plan that’s right for your family.

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.