Abel Financial Strategies: certified financial planner

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Wednesday, August 5, 2015

5 Ideas on How to Reduce Your Taxable Income

We work hard to earn the best income possible to support our families and retirement; however, the more we make, the more we pay in taxes which may be counter-productive to the hard work put forth to earn more. As a result, many Americans are actively consulting with Certified Financial Planners for methods to reduce their taxable income. We’ve compiled 5 of the most common methods to reduce your taxable income.

1. Contribute to Retirement:

o As previously mentioned, planning for retirement is one of the top motivating factors of working hard for a greater income. There are several types of retirement accounts and each has different rules. A 401(k), 403(b), 457 or Thrift Savings Plan have a 2015 contribution maximum of $18,000 with a catch-up contribution allowance of $6,000 for anyone who turns 50 in 2015. All of the aforementioned Retirement Accounts require establishment and funding by 12/31/2015.

o The Self-Employment Pension has a different set of rules. The maximum contribution for 2015 is $53,000 and the deadline for funding the account is 04/15/2016 plus any extensions you may have been approved for. There is an additional formula to calculating your maximum contribution limit including items such as a percentage of your net profit.

o Lastly of the Retirement Account types we will discuss are Traditional & Roth IRA accounts. These accounts allow for funding of up to $5,500 for 2015 or $6,500 if you turn 50 during the 2015 tax year. Funding of this account must be deposited by 04/15/2016 with no extension opportunity.

o Please keep in mind some of these account have additional age and wage restrictions.

2. HSA Contributions:

o Contributions limits for a health savings account for tax year 2015 are as follows below. Take note of the additional $1,000 contribution if you are age 55 or older. The deadline to fund a health savings account for tax year 2015 will be April 15^th, 2016; the same as the tax deadline without extension. It is also important to know that in order to open and fund a health savings account you must have a qualified high deductible health plan HSA policy with a minimum deductible of $1,300 single or $2,600 family and a maximum deductible of $6,450 single or $12,900 family. The contribution limits and deductible minimums and maximums tend to skew upward a little each tax year.

3. Donate to a charitable cause you are passionate about.

o Charitable contributions, unlike HSA contributions, must be made by the end of the tax year you are writing the donation off for. For donations you would like to reduce your income by for 2015, the donation must be made by 12/31/2015. It is important to be familiar with the qualified organizations as per the IRS which can be reviewed in the link provided here. Before deciding on the amount of your donation you will want to consult a tax professional or Certified Financial Planner to determine the maximum amount you are able to donate as qualified to reduce your taxable income based on the overall adjusted gross income you will report that year. These guidelines can also be found here.

4. Pay property tax early:

o The years for which you deploy this strategy will be a matter to consider. Ultimately, by use of this strategy there will be a year for which you are paying your property taxes twice. If you have a property tax bill due in January and you itemize, paying it before December 31 will allow you to deduct the payment from your taxable income on your 2015 tax return. It is also important to consult your trusted financial planner with this strategy because prepaying your property taxes could trigger the AMT, or Alternative Minimum Tax. There are multiple write-off that must be added back when calculating AMT liability. Again, consult your financial planner or tax professional to determine when this strategy may be a good option.

5. Defer income:

o This method may not be available to everyone, but for those who receive compensation such as a year-end bonus could ask that the additional income not be paid until after the first of the year. This strategy may also work well for those who are self-employed. Invoicing could be delayed until late in the month of December causing the receipt of payment to arrive after the first of the year.

As you can see there are numerous ways to arrange your finances for a more favorable tax liability. I’m sure you have also recognized the many times we’ve stressed the importance of consulting with a Certified Financial Planner. This article is not meant to replace the need to speak with a professional who is well versed in the qualifications and restrictions available with each method. You are encouraged to call A.W. Abel as a resource of information. 614-499-1201

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Your complete source for personal financial planning.

A Certified Financial Planner ® in good standing that believes whole-heartedly in the Standards of the CFP ® program.

Securities offered through First Heartland Capital®, Inc. Member FINRA/SIPC Advisory Services offered through First Heartland Consultants®, Inc. (Abel Financial Strategies is not affiliated with First Heartland Capital®, Inc.)

Data sources: Economic: Based on data from U.S. Bureau of Labor Statistics (unemployment, inflation); U.S. Department of Commerce (GDP, corporate profits, retail sales, housing); S&P/Case-Shiller 20-City Composite Index (home prices); Institute for Supply Management (manufacturing/services). Performance: Based on data reported in WSJ Market Data Center (indexes) and Barron's (S&P 2014 total return); U.S. Treasury (Treasury yields); U.S. Energy Information Administration/Bloomberg.com Market Data (oil spot price, WTI Cushing, OK); www.goldprices.org (spot gold/silver); Oanda/FX Street (currency exchange rates). All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness. News items are based on reports from multiple commonly available international news sources (i.e. wire services) and are independently verified when necessary with secondary sources such as government agencies, corporate press releases, or trade organizations. Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice. Past performance is no guarantee of future results. All investing involves risk, including the potential loss of principal, and there can be no guarantee that any investing strategy will be successful.

The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. The Russell 2000 is a market-cap weighted index composed of 2000 U.S. small-cap common stocks. The Global Dow is an equally weighted index of 150 widely traded blue-chip common stocks worldwide. The U.S. Dollar Index is a geometrically weighted index of the value of the U.S. dollar relative to six foreign currencies. Market indices listed are unmanaged and are not available for direct investment. Securities offered through First Heartland Capital® , Inc. Member FINRA/SIP

Thursday, July 2, 2015

4 Triggering Events of Business Succession & What to Plan for In Each

We can all agree the worst time to make an important decision is on the spot. Often times this is when the emotional brain takes over for the rational brain and the best possible decision may not have been considered. Ideally a business succession plan is constructed when a partnership is formed, but we live in the real world and many businesses may not have realized this at that time. Businesses often get busy trying to get profitable and never end up coming back to this. Generally speaking, there are 4 situations to consider succession planning for, each of which may require a unique solution of their own.

Retirement:

When do you plan to retire? Do you plan to retire and no longer work or will you retire to move on to a new phase of your work life? In either situation leaving the remaining business partner with adequate funding so that a rash decision doesn’t have to be made on the spot is the real purpose of a great succession plan. Seeking and planning for proper retirement funding is critical to assuring cash flow will not be penetrated and the clients are not left with a surprise from the business they’ve come to appreciate and trust.

Death:

In the event of a business owner’s death a few considerations must be examined and included in the overall business succession plan. For example, will the partner’s spouse now become part owner of your company? Do you or they want that to happen? Talk to your financial advisor to discuss the best method of funding a buy/sell agreement that would leave both the business and the spouse with adequate funding to perform the arrangement agreed upon.

Disability:

Death is certain and a triggering event most of us will first consider; however, there is a chance that you would suffer an injury or illness that makes it impossible for you to continue running your business prior to retirement. This disability could be total or partial though in either event it is suggested to consider both situations as possible. In the event of a partial disability will you still perform certain duties of your role in the business, who will take over the remaining responsibilities and how with that person’s time and compensation be funded?

Early Exit:

This final category is really a catch all for other less common reasons a business may need to enforce a buy/sell agreement. Some of these triggering events may be divorce, personal insolvency or bankruptcy, criminal conviction, loss of professional license or termination of employment.

When creating your succession plan with your Certified Financial Planner it is important to consider if each triggering event will produce the same reaction. Example, would divorce and death both provide the same benefits of the buy/sell protection? One scenario may call for change of beneficiary whereas the later may call for estate tax mitigation. Again, we can all agree that making a decision at the onset of one of these events may not be the most appropriate time. Working with your Certified Financial Advisor could fairly make the list of your current short term goals with either a new succession plan or as a review of your current succession plan.

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Visit AWAbelFinancial.com fore more information.

Your complete source for personal financial planning.

A Certified Financial Planner ® in good standing that believes whole-heartedly in the Standards of the CFP ® program.

Abel Financial Strategies are not attorneys or accountants. If a need is discovered, we will refer you to attorneys or accountants in your area to work with or work closely with your attorney or accountant to resolve the need.

Thursday, February 26, 2015

Tax Time is here - Key Tax Numbers to help you file in 2015

April 15th is rapidly approaching and for many individuals and businesses, it's time to start preparing your 2014 tax returns. At Abel Financial Strategies we can advise you on several ways to help lower your tax liability or maximize your return. We offer tax planning on options to include:

Give us a call and we can discuss the various options available to you for lowering you overall tax liability!

Key Tax Numbers for 2015

In order to help you prepare your taxes, Abel Financial Strategies has put together some Tax Reference Numbers at a glance for you.

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Your complete source for personal financial planning.

A Certified Financial Planner ® in good standing that believes whole-heartedly in the Standards of the CFP ® program.

Augustus Abel does not provide legal or tax advice. These topics are discussed in conjunction with your CPA, Tax Advisor and Attorney.

Securities offered through First Heartland Capital®, Inc. Member FINRA/SIPC Advisory Services offered through First Heartland Consultants®, Inc. (Abel Financial Strategies is not affiliated with First Heartland Capital®, Inc.)

Friday, February 6, 2015

Market review - a look back at 2014

At Abel Financial Strategies, we examine market performance closely to look for trends that can help us to determine actions to take in the portfolios we manage.. Here's a look back at 2014 with an overall market review.

Overview

The United States emerged from 2014 as the best house on a troubled block. Civil war in Ukraine, a slowing Chinese economy, a stagnant Europe worried about potential deflation, a new recession in Japan, the threat of a new Russian economic meltdown triggered by plummeting oil prices--it all made an improving situation at home look even brighter by comparison.

Even apart from the troubles overseas, the United States by almost any measure was stronger than it's been in years. The labor and housing markets improved, corporate profits were solid, Congress managed to avert another government shutdown, and the Ebola threat had little impact domestically. All in all, it was a Goldilocks economy: not too hot, which could have brought on higher interest rates from the Federal Reserve, and not too cold, which let the Fed end the QE3 bond purchases begun in the wake of the 2008 financial crisis.

That domestic strength fueled more gains for domestic equities than had been envisioned for the fifth year of this bull market. The S&P 500 ended 2014 up more than 200% from its March 2009 low, and the Dow saw its sixth straight yearly gain. However, in the coming year, investors will almost certainly be faced with the start of long anticipated interest rate increases. Though the Fed has promised patience in implementing rate hikes, higher borrowing costs and a strong dollar that makes U.S. goods more expensive overseas could create a headwind for domestic corporations. The question is whether that wind might blow the economy off its current promising course or will merely keep the game interesting.

Snapshot 2014 The Markets

• Equities: After a discouraging start, large-cap domestic equities spent much of the year climbing to new heights. Though they didn't come close to matching last year's fireworks, the S&P 500 and Dow industrials set 53 and 38 new record highs respectively during the year. However, little of that love spilled over to the small caps. The Russell 2000, which had soared in 2013, had trouble scaling the page proverbial "wall of worry" and spent much of 2014 either flat or down before a Q4 rally returned it to positive territory. The Nasdaq proved the strongest of the four indices; by December it had come within 242 points of its all-time closing high of 5,048.62, set in March 2000. Beset by weakness worldwide, the Global Dow barely managed a positive return for the year.

• Bonds: The bond market confounded those who had feared bond prices would suffer from the unwinding of Federal Reserve support. Challenges overseas lured investors to the safety of U.S. Treasuries; prices rose as the benchmark 10-year yield dropped more than 3/4ths of a percentage point, especially after the threat of an imminent Fed rate hike faded and falling oil prices threatened the economies and currencies of several oil-dependent countries.

• Oil: A drop in crude prices that began in July accelerated in Q4 after Saudi Arabia chose market share over profit by deciding not to cut supplies. Prices promptly plummeted to levels not seen since the depths of the financial crisis, falling roughly 45% from the July high of $107 a barrel. The plunge in oil prices helped fatten consumers' wallets but renewed concerns about oil-dependent economies.

• Currencies: Falling oil prices coupled with the expectation of higher interest rates helped boost the U.S. dollar, which rose almost 11% over the course of the year. The dollar also benefitted from interest rates abroad, some of which were even lower than those for Treasuries. The strong dollar raised new concerns that countries and foreign corporations hurt by lower oil prices might have trouble repaying debt in currencies that were substantially weaker against the U.S. dollar.

• Gold: After plummeting in 2013, gold managed to stabilize a bit last year. The precious metal ended the year at roughly $1,180--not far from where it began in January despite a spring rally prompted in part by the crisis in Ukraine.

The Economy

• Unemployment: Improvement in the U.S. job market was slow but steady. The unemployment rate ended the year at 5.8%, its lowest level since July 2008 and better than last December's 6.7%. According to the Bureau of Labor Statistics, the unemployment rate is now down 4.2 percentage points from its October 2009 high of 10%. And after a slow start, job creation accelerated; by December, the number of new jobs added during the previous 12 months was the highest it's been since April 2006.

• GDP: After a slump during the first quarter, when the U.S. economy contracted by 2.1%, by Q3 the U.S. economy was growing at its fastest pace in 11 years. The Bureau of Economic Analysis said the 5% annualized growth of gross domestic product outpaced Q2's 4.6% and represented the strongest growth since Q3 2003's 6.9%. After-tax corporate profits also were up, rising 2.8% from Q2 and more than 5% from a year earlier.

• Inflation: Inflation remained well under historical averages, which allowed the Fed to postpone any interest rate hike until 2015. By December, the Bureau of Labor Statistics said consumer inflation for the previous 12 months stood at 1.3% while wholesale prices gained 1.4% over the same time. The lower gas prices that kept inflation in check also helped spur retail sales and consumer spending.

• Housing: The most recent home prices measured by the S&P/Case-Shiller 20-City Composite Index were up 4.5% from a year earlier, and the National Association of Realtors® said that by November, new home sales were slowing but still up 2.1% year over year. However, both year-over-year figures were lower than in previous months, and slippage in both housing starts and building permits suggested that the pace of gains may be slowing.

• Manufacturing: Manufacturing was a fundamental component of the economy's strength during the year. The Federal Reserve said that by the end of the year, usage of the nation's industrial capacity had finally reached its long-term average. Meanwhile, higher exports helped shrink the U.S. trade deficit to $43.4 billion.

• International markets: Economic problems overseas contributed to the Fed's caution with interest rates. Though the European Central Bank cut a key interest rate to -0.1% and continued to say it was prepared to take stronger measures to try to avoid potential deflation, Europe entered the new year still waiting for additional stimulus. In Japan, two consecutive quarters of contraction marked an official recession, calling so-called "Abenomics" into question. Meanwhile, faced with growth that had slowed to 7.3% by Q3, China's central bank cut two key interest rates to try to stimulate domestic consumption; it also agreed to work with the United States to cut greenhouse gases. Finally, President Obama took steps to reestablish diplomatic relations with Cuba, though ending the trade embargo would require congressional action.

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Your complete source for personal financial planning.

A Certified Financial Planner ® in good standing that believes whole-heartedly in the Standards of the CFP ® program.

Thursday, January 29, 2015

Meet A. W. Abel - Owner of Abel Financial Strategies

Augustus "A.W." Abel is the owner of Abel Financial Strategies and has been in the financial business since 1999. Let's meet A.W. Abel!

I started in Financial Planning with Lutheran Brotherhood (now Thrivent Financial) in January 1999. This company worked primarily within the Lutheran community with a heavy focus on good principles and morals. It was a great place to start in the business and we also did a lot of outreach in the community. In late 2009, I left Lutheran Brotherhood and became independent which means that I don’t represent a particular company. In my opinion, this is a much better style of business for both myself and my clients.

I’m from a small town in Southeastern Ohio - McConnelsville. This towns history includes an encounter with Morgan’s Raiders - a Civil War Confederate band that came through the area. It’s a beautiful area in the foothills of the Appalachian Mountains and it was probably one of the best places to grow up that I can imagine. I had a kind of a Huckleberry Finn childhood with a lot of adventures as I spent a lot of time on the river that goes through the area. My parents owned the bowling alley/restaurant in town. I attended Morgan High School in McConnelsville, The Ohio State University and The American College.

I am a Certified Financial Planner™ (CFP®) This is the most highly regarded designation in the financial planning industry and I became a CFP in 2004. The designation requires completion of a series of courses and then passing a 10-hour 2-day test. After successful completion we are then required to complete 30 Hours of Continuing Ed every 2 years. The organization also has very strict Ethics rules that translate completely to my own business.

I achieve the Leaders Conference Award each year from First Heartland Capital (the Broker Dealer that I do my business through) and achieved Presidents Club with Lutheran Brotherhood most years while I was there. I have done a lot of work with Lutheran Social Services through the years and have supported local food pantries. I also worked for three years organizing a fundraiser for the Mike Furrey Foundation which supports a program called “Basket of Hope” for Children with chronic diseases at Children’s Hospitals around the country.

Learn more about my Business Philosophy!

Some Questions and Answers with A.W.

Who is your family? (Spouse/Kids) – My wife is Sandy and my 16 year old son Austin

What book do you recommend? – "Medicine and What Matters in the End" – This is an interesting book for understanding medical care for people in their later years of life. Many families are dealing with this issue without any preparation

What are your hobbies/interests? – I am a better than average bowler – so I bowl about 3 times a week. It keeps me active. I also like cars, scuba and golf.

Why did you get into Financial Services? – I was Regional Manager in the Bowling Industry for many years. After a company sale, I was disappointed with the new owners and looked for a career to transition to. Financial Planning allowed be to use my management, problem solving, and planning skills with individual clients.

What are your future goals? - I will continue to develop and grow my practice focusing on individuals and small businesses and helping them identify goals and develop plans to work toward those goals.

What are your favorite sports teams? – The Ohio State Buckeyes, Pittsburgh Steelers, Columbus Blue Jackets, Columbus Crew and The Cincinnati Reds.

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Your complete source for personal financial planning.

A Certified Financial Planner ® in good standing that believes whole-heartedly in the Standards of the CFP ® program.

Friday, January 23, 2015

Abel Financial Strategies - an overview of our services

At Abel Financial services, we offer a wide range of services to help you with your financial planning, goal setting, retirement planning, wealth transfer, and risk protection for those unplanned events in your life. Here are some details about the services we offer:

Professional Services:

As a Certified Financial Planner®, I use the CFP® process for financial planning. Our investment abilities have been honed since 1999 in the investment industry. We believe in a balanced focus on risk diversification, growth potential, and tax consideration. I understand that each client's goals and needs are specific to them, and I will not use a cookie cutter approach.

Financial Services:

In using a comprehensive analysis of your needs and objectives, and having thorough discussions with you to clarify your feelings, we will be able to lay out a plan to work toward your goals. Investment goals and needs are very specific to each client as is your level of risk tolerance. Our investment philosophy is based on modern investment processes of identifying risk tolerance, time horizon, and objective and then applying that knowledge to the investment models and stable of investments we use. Asset portfolios are typically rebalanced periodically but may be more or less frequently due to market changes, economy changes, and proximity to your goals.

Estate Planning Services

Our estate analysis will include a thorough examination of your net worth, income, Wills*, Powers of Attorney*, your wishes for estate transfer, and Charitable Gifting. We will then determine the options for you to work toward your goals.
* Associates of Abel Financial Strategies do not provide legal advice.

Business Continuity Planning

Buy/Sell Planning and Funding
Key Person Life Insurance Plans
Business Overhead Expense Protection

Executive Benefit Plans

Deferred compensation plans
Salary Continuation Plans
Split Dollar Arrangements

Retirement Plans

Pension
Profit Sharing
401(k)
403(b)
457 Plans
Simple IRA and 401(k)
Simplified Employee Pension (SEP)
Money Purchase
Roth 401(k)

Group Medical Insurance

Preferred Provider
Traditional Medical
Health Savings Accounts

Abel Financial Services works with clients throughout Ohio including Powell, Dublin, Delaware, Westerville, Worthington, and Columbus, Ohio. I am licensed in many other states and can serve your needs wherever you live.

We maintain a Fiduciary Obligation to our clients and therefore only recommend solutions that are in your best interests. We have a large variety of products available to us through many companies and are not influenced by any one company to use their products.

The reason for the success of our business is very simple – We place the highest value on our relationship with our clients and their trust in us. That combined with our experience and education are the reasons clients stay with us and refer their family and friends to us!

Our securities licenses are held by First Heartland Capital, Inc. an independent broker/dealer. Being totally independent, we are not obligated to any one company to recommend certain investment products over others.

Be Sure to Follow all of our social media channels and subscribe to our blog!

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View our website!

Your complete source for personal financial planning.

A Certified Financial Planner ® in good standing that believes whole-heartedly in the Standards of the CFP ® program.

Tuesday, January 13, 2015

Welcome to the new Abel Financial Strategies Blog!

A Robust Social Media Presence is No Longer Optional

We are pleased to launch the new Abel Financial Strategies company blog and business social media channels. We have had a social media presence in the past, but for 2015 we are increasing the number of posts to feature company news, industry news, financial services, address frequent questions, as well as provide tools and advice.

Abel Financial Strategies at a Glance

We take a holistic approach in our client relationships and financial plans. As such, we offer comprehensive financial, retirement and estate planning, and professional fee-based investment advisory services.

We maintain a Fiduciary Obligation to our clients and therefore only recommend solutions that are in your best interests. We have a large variety of products available to us through many companies and are not influenced by any one company to use their products.

The reason for the success of our business is very simple – We place the highest value on our relationship with our clients and their trust in us. That combined with our experience and education are the reasons clients stay with us and refer their family and friends to us.

Our securities licenses are held by First Heartland Capital, Inc. an independent broker/dealer. Being totally independent, we are not obligated to any one company to recommend certain investment products over others.

Be Sure to Follow all of our social media channels and subscribe to our blog!

Facebook

Twitter

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View our website!