FINANCIAL CONSIDERATION$ DURING TRAN$ITION
Description: FINANCIAL CONSIDERATION DURING TRANITION Presented by: Lisa M. Gabriel, CFP , ChFC President CEO, Pinafore Wealth Counsel, Inc. DONT PANIC! Make a plan financial strategies, key moves and decisions can make the difference. FIRST
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slide1. FINANCIAL CONSIDERATION$ DURING TRAN$ITION Presented by:
Lisa M. Gabriel, CFP ®, ChFC ®
President & CEO, Pinafore Wealth Counsel, Inc.<br>
slide2. DON’T PANIC! Make a plan – financial strategies, key moves and decisions can make the difference.<br>
slide3. FIRST STEPS…… Promptly file for unemployment insurance
Handle severance package with care
Maintain health insurance
Continue life and disability insurance
Map out priorities<br>
slide4. MAKE A FINANCIAL SURVIVAL STRATEGY<br>
slide5. SURVIVAL BUDGET Sources of income
Severance pay
Unemployment benefits
Cash from emergency fund
Working spouse’s income (decrease tax withholding)
Temporary work/freelance<br>
slide6. SURVIVAL BUDGET Age 62 or older?
Social Security (Earnings limit $15,480)
Other Cash Sources (come with limits and consequences)
Cash value of life insurance
Home equity
Reverse mortgage (62 or older)<br>
slide7. SURVIVAL BUDGET Think Outside the Box:
Collect on loans you have made
Ebay?
Barter<br>
slide8. SURVIVAL BUDGET List expenses in order of priority
Mortgage/rent
Groceries/utilities
Student loans
Car payments/transportation
Job search expenses
Reduce discretionary expenses<br>
slide9. STUDENT LOANS Income-based repayment
Student loan forgiveness program
Public Service Loan Forgiveness
Only applies to Federal Direct Loan Program
Must make 120 on-time, monthly payments (10/1/2007)<br>
slide10. NC Foreclosure Prevention Fund Meet Robert Sherwood
www.ncforeclosureprevention.gov
1-888-623-8631
“If you qualify, the NC Housing Finance Agency will make your mortgage payment directly to your loan provider or bank.”<br>
slide11. NC Foreclosure Prevention Fund Job loss, divorce, illness
0% interest up to $36,000
If you remain in home, loan is forgiven at end of 10 years
Special program for Veterans<br>
slide12. SURVIVAL BUDGET Reduce contributions to retirement or educational savings accounts
Consider government or private assistance
Talk to your family
Adjust expectations
Teachable moment<br>
slide13. MANAGE DEBT Avoid using credit cards
Contact creditors – renegotiate
Sell collateral (car, boat)
Consolidate debts – carefully
Credit counseling service
800/338-2227<br>
slide14. YOUR CREDIT SCORE Review your credit report and score
www.annualcreditreport.com
www.creditkarma.com
Ways to improve your credit score
Correct any inaccuracies
Higher scores = lower premiums for auto and homeowners insurance<br>
slide15. Retirement Plan Decisions If you have a loan against your 401k it must be repaid per plan document
If not repaid, it is treated as a withdrawal - taxable income and if you are under 59 ½ a 10% early withdrawal penalty is assessed
Consider rolling 401k into IRA Rollover
You control custodian and investments
Review beneficiary designations<br>
slide16. Retirement Plan Decisions Withdrawals are taxed as ordinary income for the year in which you make the withdrawal. Also, you may have to pay a 10% penalty tax for early withdrawal if you're under age 59½ unless an exception to the penalty applies.
Tip: If you're considering taking funds from your IRA or retirement plan, you should consult a tax advisor regarding the specific tax treatment of your withdrawal.<br>
slide17. Retirement Plan Decisions Consider a Roth Conversion for part or all of a 401k/403b if your income permits
If you have a State 401k/403b
You may qualify for the “Bailey” provision
Beneficiary IRA’s no longer bankruptcy protected unless State exemptions apply<br>
slide18. Investment Decisions Stock options to exercise?
Review asset allocation
Roth IRA conversion
Avoid short-term or risky investment strategies
Don’t become a day-trader<br>
slide19. STAY HEALTHY! Eat healthy foods
Exercise
Limit alcohol
Seek support<br>
slide20. REEVALUATE Network/NetWeave
Be flexible
Relocate?
Invest in yourself – reassess your career or consider additional job training
Reestablish life goals
Have faith, volunteer and help others<br>
slide21. WHEN YOU RETURN TO WORK Celebrate – hug your loved ones
Assess current financial situation
Create a new budget
Start saving and tackle debt
Rebuild emergency fund
Catch-up on retirement savings
Get a check-up – good health is one of your greatest financial assets<br>
slide22. Questions?<br>
slide23. THANK YOU! Newsletter Sign-Up Available Presented by:
Lisa M. Gabriel, CFP ®, ChFC ®
President & CEO, Pinafore Wealth Counsel, Inc.<br>
Lisa M. Gabriel, CFP ®, ChFC ®
President & CEO, Pinafore Wealth Counsel, Inc.<br>
slide2. DON’T PANIC! Make a plan – financial strategies, key moves and decisions can make the difference.<br>
slide3. FIRST STEPS…… Promptly file for unemployment insurance
Handle severance package with care
Maintain health insurance
Continue life and disability insurance
Map out priorities<br>
slide4. MAKE A FINANCIAL SURVIVAL STRATEGY<br>
slide5. SURVIVAL BUDGET Sources of income
Severance pay
Unemployment benefits
Cash from emergency fund
Working spouse’s income (decrease tax withholding)
Temporary work/freelance<br>
slide6. SURVIVAL BUDGET Age 62 or older?
Social Security (Earnings limit $15,480)
Other Cash Sources (come with limits and consequences)
Cash value of life insurance
Home equity
Reverse mortgage (62 or older)<br>
slide7. SURVIVAL BUDGET Think Outside the Box:
Collect on loans you have made
Ebay?
Barter<br>
slide8. SURVIVAL BUDGET List expenses in order of priority
Mortgage/rent
Groceries/utilities
Student loans
Car payments/transportation
Job search expenses
Reduce discretionary expenses<br>
slide9. STUDENT LOANS Income-based repayment
Student loan forgiveness program
Public Service Loan Forgiveness
Only applies to Federal Direct Loan Program
Must make 120 on-time, monthly payments (10/1/2007)<br>
slide10. NC Foreclosure Prevention Fund Meet Robert Sherwood
www.ncforeclosureprevention.gov
1-888-623-8631
“If you qualify, the NC Housing Finance Agency will make your mortgage payment directly to your loan provider or bank.”<br>
slide11. NC Foreclosure Prevention Fund Job loss, divorce, illness
0% interest up to $36,000
If you remain in home, loan is forgiven at end of 10 years
Special program for Veterans<br>
slide12. SURVIVAL BUDGET Reduce contributions to retirement or educational savings accounts
Consider government or private assistance
Talk to your family
Adjust expectations
Teachable moment<br>
slide13. MANAGE DEBT Avoid using credit cards
Contact creditors – renegotiate
Sell collateral (car, boat)
Consolidate debts – carefully
Credit counseling service
800/338-2227<br>
slide14. YOUR CREDIT SCORE Review your credit report and score
www.annualcreditreport.com
www.creditkarma.com
Ways to improve your credit score
Correct any inaccuracies
Higher scores = lower premiums for auto and homeowners insurance<br>
slide15. Retirement Plan Decisions If you have a loan against your 401k it must be repaid per plan document
If not repaid, it is treated as a withdrawal - taxable income and if you are under 59 ½ a 10% early withdrawal penalty is assessed
Consider rolling 401k into IRA Rollover
You control custodian and investments
Review beneficiary designations<br>
slide16. Retirement Plan Decisions Withdrawals are taxed as ordinary income for the year in which you make the withdrawal. Also, you may have to pay a 10% penalty tax for early withdrawal if you're under age 59½ unless an exception to the penalty applies.
Tip: If you're considering taking funds from your IRA or retirement plan, you should consult a tax advisor regarding the specific tax treatment of your withdrawal.<br>
slide17. Retirement Plan Decisions Consider a Roth Conversion for part or all of a 401k/403b if your income permits
If you have a State 401k/403b
You may qualify for the “Bailey” provision
Beneficiary IRA’s no longer bankruptcy protected unless State exemptions apply<br>
slide18. Investment Decisions Stock options to exercise?
Review asset allocation
Roth IRA conversion
Avoid short-term or risky investment strategies
Don’t become a day-trader<br>
slide19. STAY HEALTHY! Eat healthy foods
Exercise
Limit alcohol
Seek support<br>
slide20. REEVALUATE Network/NetWeave
Be flexible
Relocate?
Invest in yourself – reassess your career or consider additional job training
Reestablish life goals
Have faith, volunteer and help others<br>
slide21. WHEN YOU RETURN TO WORK Celebrate – hug your loved ones
Assess current financial situation
Create a new budget
Start saving and tackle debt
Rebuild emergency fund
Catch-up on retirement savings
Get a check-up – good health is one of your greatest financial assets<br>
slide22. Questions?<br>
slide23. THANK YOU! Newsletter Sign-Up Available Presented by:
Lisa M. Gabriel, CFP ®, ChFC ®
President & CEO, Pinafore Wealth Counsel, Inc.<br>