Tag Archives: Michelle Floyd

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Money Matters | Are You Prepared to Handle a Personal Financial Crisis?

michelle-head-shot
Michelle Floyd, CFP,
Financial Consultant

Are You Prepared to Handle a Personal Financial Crisis?

Individuals who are married or in a committed relationship face the possibility they’ll end up managing finances alone at some point in their lives. Unfortunately, the first time many experience handling complicated financial matters alone is during a personal crisis following the death or divorce of a spouse or partner.

We’ve prepared a list of thought-provoking questions pertaining to financial fitness and crisis preparedness. You can use these as a starting point to check how prepared you are to handle a personal financial crisis in your life. Begin by reviewing the questions, determine what you’ve already done, and check those items off the list. For the questions you need to address or take action on, seek the advice of professional advisors and trusted family members.

Asset management

• Do I have a clear picture of where my assets are located?
• Will my retirement assets provide a comfortable retirement for my life expectancy?
• Do I have a well-diversified portfolio?
• Are my investments appropriate in today’s economy?
• Are my assets titled properly?
• Do I have an emergency fund?
• Am I taking advantage of techniques to reduce my taxes?

Estate planning

• Do I have a will?
• Is my will current?
• Have I determined what my family may owe in estate taxes?
• Have I funded my estate-tax liability?
• Have I explored and taken advantage of wealth-transfer techniques?
• Do I wish to provide for charitable giving?
• Are my power of attorney and my living will up to date?

Debt management

• Do I know my credit rating?
• Could I get a loan if I applied?

Insurance

• Do I have enough insurance coverage to cover medical expenses?
• To provide for disability/long-term care?
• To provide for family members’ security?
• To fund estate-tax liability?

In addition …

• Have I coordinated my advisors’ (attorney, CPA, banker) activities?
• What changes in my life are likely to occur within the next three years?
• Do I know the status of my parents’/children’s financial situation and the implications for my financial well-being?
• Would I be prepared for a family emergency if it happened tomorrow?

Our firm does not provide legal or tax advice. Be sure to consult with your own tax and legal advisors before taking any action that could have tax consequences. Any estate plan should be reviewed by an attorney who specializes in estate planning and is licensed to practice law in your state
This article was written by/for Wells Fargo Advisors and provided courtesy of Michelle Konkle, CFP®, Financial Consultant with Axiom Financial Strategies Group in New Albany, IN at 812-948-8475.
Investments in securities and insurance products are: NOT FDIC-INSURED/NOT BANK-GUARANTEED/MAY LOSE VALUE
Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC, Member SIPC, a registered broker-dealer and non-bank affiliate of Wells Fargo & Company.

© 2017 Wells Fargo Clearing Services, LLC. All rights reserved. CAR 0217-04864

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Money Matters | What to Expect as an Executor or Trustee

Todd Harrett, Financial Advisor with Axiom Financial Strategies Group of Wells Fargo Advisors in New Albany, Ind.

Todd Harrett, Financial Advisor with Axiom Financial Strategies Group of Wells Fargo Advisors in New Albany, Ind.

What to Expect as an Executor or Trustee

Being asked to serve as an executor or a trustee for an estate is certainly an honor, but it’s also a considerable responsibility. And knowing and understanding those responsibilities can help you be prepared.

Many people don’t realize what they are taking on and all the duties required, says Lisa Montano, an Estate Planning Strategist for Wells Fargo Advisors. “Depending on the estate’s level of complexity and the assets in the estate that need to be administered, it can be very time-consuming,” she says.

Here are five things you need to know now:

It’s not an easy job. Serving as executor or trustee typically requires a significant amount of time, patience, and organization. It can take up to a year, maybe longer, to completely wrap up someone’s financial affairs, Montano says.

You need to know what the assets are and how to find them. Ask where the will or trust is located and how you will be able to access those documents when the time comes. Also, consider
asking for a detailed list of assets and where they can be found.

You can seek professional help. You can hire a lawyer to help you manage the most complicated duties or to oversee the whole process. You can also engage a CPA to help with tax issues. “Even if the estate is simple, consulting with an attorney is a good idea. There are responsibilities and deadlines you have to meet that are laid out by state law. You also need to follow the instructions as laid out in the will or trust. Sometimes people do things on their own and it gets them in trouble. The court may remove them as executor or trustee, or they may be held personally liable for actions they have taken,” Montano says.

You may be entitled to compensation. Trustees and executors are typically entitled to collect a
reasonable fee, Montano says. The amount may be regulated by state law or specified in the will or trust. You may choose to waive the fee, but you might still want to be reimbursed for travel and other expenses.

You can decline to serve. It’s okay to say you are not comfortable serving, Montano says. If you do, then someone else or a corporate trustee or a third-party executor such as a bank, trust company, or a professional who has experience dealing with estates will need to be chosen.

Our firm does not provide tax or legal advice.

Trust services available through banking and trust affiliates in addition to non-affiliated companies of Wells Fargo Advisors. Any estate plan should be reviewed by an attorney who specializes in estate planning and is licensed to practice law in your state.

This article was written by/for Wells Fargo Advisors and provided courtesy of Todd Harrett, Financial Advisor with Axiom Financial Strategies Group in New Albany, IN at 812-948-8475.
Investments in securities and insurance products are: NOT FDIC-INSURED/NOT BANK-GUARANTEED/MAY LOSE VALUE
Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC, Member SIPC, a registered broker-dealer and non-bank affiliate of Wells Fargo & Company.

© 2018 Wells Fargo Clearing Services, LLC. All rights reserved. 0218-01932

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Money Matters | Debt Management Solutions

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Michelle Floyd, CFP,
Financial Consultant

Debt Management Solutions

Balancing debt repayment with investing goals takes some strategy and planning. Some consider investing as a first line of defense while paying down debt as a second.

The debt dilemma

The process for eliminating debt is anything but an easy-to-solve financial equation. Many people wonder if they should pay off their debt as quickly as possible or invest their money, letting debt payments run their course.

The answer depends on whom you ask. Theories about balancing investing with debt vary widely. Some financial experts say freedom from debt is the most important goal. Others say it’s more about the math: Your money should go toward investing if your investments earn a higher rate of return than your debts cost you. Still others focus on the emotional aspect: How comfortable are you with a certain level of debt?

Neither one nor the other

Better yet, perhaps, is a balanced approach to wealth management. If you’re like most people, you’ll need to manage finances for both present and future needs. That means paying off some debt today while simultaneously investing with an eye on the future.

Although your decisions should take into account your own needs and circumstances, consider the following guidelines for handling debt in light of investing goals:

Save for a rainy day. Before paying down debt (beyond required payments) or settling on an investment strategy, make it your first priority to put funds aside for an emergency reserve. We recommend six months or more of living expenses; an absolute minimum is three months’ worth. These funds should be in traditional savings or very short-term, highly liquid, low-volatility investments.

Put your future first. As a general rule, your long-term investment plan should take priority over applying extra amounts toward debt. Be careful as well not to let “lifestyle creep,” a tendency toward more expensive tastes and luxury consumption, impede your investment outlook.

By contributing to a long-term investment plan as early as possible, you may set yourself up for a brighter future. If paying down debt is also a priority, you’ll want to examine your personal budget to decide how much to direct each month toward investing and how much toward debt repayment. Just remember, there are no magic numbers. In general, the best advice is to make sure your investment strategy fits your financial expectations for the future.

Prioritize your debts. With an emergency fund in place and your investment strategy up and running, putting any extra money toward your debts is also a smart way to go. But how do you decide which debts to pay down first?

One approach is to start with the smallest debts first to eliminate at least some of your debt burden and interest payments in a timely manner. It also makes sense to pay off high-interest debts like private student loans and credit card debt more quickly.

Federal student loans and mortgages might be lower priorities, because their rates are often lower and their terms are longer. Vehicle loans might fall somewhere in the middle. Tax considerations might also come into play.

It’s personal. As you divide and conquer debt, don’t forget to consider the emotional side of your strategy. If paying off a certain debt will help you feel more secure, you might want to go with your gut feeling.You’ll enjoy a growing sense of financial freedom as you stay on course and get your debt under control. As it shrinks over time, you may find you have more funds available for enjoying the present and focusing on the future.

This article was written by/for Wells Fargo Advisors and provided courtesy of Michelle Konkle, CFP®, Financial Consultant with Axiom Financial Strategies Group of Wells Fargo Advisors in New Albany, IN at 812-948-8475.
Investments in securities and insurance products are: NOT FDIC-INSURED/NOT BANK-GUARANTEED/MAY LOSE VALUE
Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC, Member SIPC, a registered broker-dealer and non-bank affiliate of Wells Fargo & Company.

© 2017 Wells Fargo Clearing Services, LLC. All rights reserved. CAR 0717-05089

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Money Matters | Elder Financial Abuse: The Silent Crime

 

Michelle Floyd, CFP, Financial Consultant

Michelle Floyd, CFP, Financial Consultant

Elder financial abuse has the potential to impact all of us on some level. Whether you are protecting a loved one from becoming a victim or actively taking precautions to protect your personal estate, fraud and exploitation is a risk that grows as people age.

It is important for individuals to understand the magnitude of this crime, identify ways to both actively prevent and stop abuse, as well as understand how to escalate if it is suspected.

Understand. Seniors lose an estimated $36.5 billion every year to the crime of elder financial abuse.i In fact, according to the 2010 Investor Protection Trust (IPT) Elder Fraud Survey, more than seven million older Americans — one out of every five over the age of 65 — have fallen victim to a financial swindle. [i]i As Baby Boomers turn 65 at a rate of 10,000 a day, the threat of potential abuse heightens.

It is imperative we take preventative measures to confront this epidemic, including educating ourselves on the potential warning signs and using the resources and tools available to stop fraud and abuse from occurring.

Identify. Spotting exploitation can be difficult as the perpetrators of these crimes tend to be close friends or relatives. Studies project that approximately 70 percent of elder financial abuse is committed by family members, friends, trusted persons or others known to the individual being exploited.[ii]i This increasingly blurred line of those who have one’s best interest at heart and those who don’t makes spotting these scams a challenge.

Here are a few warning signs:

  • Sudden reluctance to discuss financial matters
  • Sudden, atypical, or unexplained withdrawals or wire transfers from their accounts, or other changes in their financial situations
  • New best friends and “sweethearts”
  • Behavioral changes, such as fear or submissiveness, social isolation, withdrawn behavior, disheveled appearance, and forgetfulness
  • Changes in the will, especially when they might not fully understand the implications
  • Large, frequent “gifts” to a caregiver
  • Missing personal belongings

Report. Reporting is single-handedly the most important step to escalating suspected elder financial abuse. Studies show that as few as one in 44 cases of elder financial abuse are reported.iv Victims tend to keep details secret for a number of reasons – fear of being victimized again, reluctance to incriminate a family member or friend, or admitting vulnerability are among them. To properly report suspected elder financial abuse, contact a state agency or the National Center on Elder Abuse.

Remember, elder financial exploitation is not exclusive. Consider the below to help protect yourself from potential abuse:

  • Organize your estate. No matter how old you are, it’s a good idea to update and organize all your financial documentation, including your will, financial powers of attorney, real estate deeds, insurance policies, pension and trust documents, birth and marriage certificates, and Social Security paperwork. Maintaining an organized file, and helping others (such as a parent, uncle or close friend) do the same, can make it easier to spot the inconsistencies and red flags that could signal financial abuse.
  • Make a list of financial contacts. Bankers, insurance agents, attorneys, accountants, stockbrokers, and other professionals should be on it. Share your list with these professionals and with family members you trust. In addition, ensure you have a trusted contact on file. This is an individual who the advisor could contact in the event of an emergency or suspected abuse.

i True Link Financial. “True Link Report on Elder Financial Abuse,” 2015.

ii Investor Protection Trust (IPT). “IPT Elder Fraud Survey,” 2010.

iii Jewish Council for the Aging, National Center for Elder Abuse. Paley Rothman article, “Who Commits Elder Financial Abuse and Why Isn’t It Reported?” 2016.

iv National Adult Protective Services Association. “Policy and Advocacy.” www.napsa-now.org. 2017.

 

This article was written by Wells Fargo Advisors and provided courtesy of Michelle Floyd, CFP®, Financial Consultant with Axiom Financial Strategies Group in New Albany, IN 47150 at 812-948-8475.

Investments in securities and insurance products are: NOT FDIC-INSURED/NOT BANK-GUARANTEED/MAY LOSE VALUE

Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC, Member SIPC, a registered broker-dealer and non-bank affiliate of Wells Fargo & Company.

© 2017 Wells Fargo Clearing Services, LLC. All rights reserved. 0617-01508

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Money Matters | Looking to Ease College Tuition Anxiety?

By Michelle Floyd, CFP®, Financial Consultant of Axiom Financial Strategies Group of Wells Fargo Advisors in New Albany, Ind.

michelle-floyd-money-matters-featureDid you realize that, according to the College Board, more than $240 billion in grants from all sources (federal loans, federal work-study, and federal tax credits and deductions) was awarded to undergraduate and graduate students in the 2015-2016 academic year? And that those students came from households spanning a wide range of household incomes?

During that academic year, the average aid for a full-time college student amounted to $14,460, including $8,390 in grants (that don’t have to be repaid) and $4,720 in federal loans.

Once you realize how many resources may be available and begin your research on financial assistance, you could be on your way toward easing some of the anxiety often associated with paying for college.

5 lessons for seeking help for college costs

 Start planning during the high school years. Pay particular attention to your child’s junior year of high school and reposition assets or adjust income before it begins. When financial aid officers review a family’s need, they analyze the family’s income in the calendar year beginning in January of the student’s junior year.

 Assume you’re eligible for aid … until you’re told you’re not. There are no specific guidelines or rules of thumb that can accurately predict the aid you and your child may be offered. Because each family’s circumstances are different, keep an open mind as you consider financial aid alternatives. A number of factors ‒ such as having several children in school at the same time ‒ may increase your eligibility for assistance.

 Reassess assets held by your children. Federal guidelines expect children to contribute 20% of certain assets toward their education’s costs, while parents are expected to contribute up to 5.64%.

That’s why assets held in custodial accounts (bank accounts, trust funds, brokerage accounts) in your children’s names may reduce the aid for which the family qualifies. But assets held in Coverdell Education Savings Accounts and 529 plans are factored into the parent’s formula, having less effect on the aid for which the family qualifies.

 Help grandparents’ target their gifts. Grandparents’ hearts often lead them to make gifts directly to grandchildren or to pay their tuition expenses. Even though payments made directly to a college avoid gift taxes, financial aid sources generally count these payments as an additional resource the family has to pay for college expenses. Distributions from grandparent-owned 529 plans are also considered as resources and assessed as your child’s income, which can reduce eligible aid.

A better idea for grandparents may be to make a gift to a 529 plan owned by the parent or grandchild. The financial aid treatment of gifts to 529 plans is generally more favorable than for gifts made directly to the grandchild. Plus grandparents using this alternative may also realize estate tax and gift tax benefits.

Assess your family’s financial situation to determine what your children will need. Gather records and begin researching available financial aid, grants, loans, and scholarships. Two forms will be key to your aid application process: the Free Application for Federal Student Aid (FAFSA) and the College Scholarship Service Financial Aid Profile (PROFILE).

The FAFSA helps you apply for federal aid, and many states also use it to determine a resident student’s eligibility for state aid. You can find forms in high-school guidance offices, college financial-aid offices, or online.

Many schools use the PROFILE to collect additional information before awarding their own funds, i.e., institutional student aid.

 Please consider the investment objectives, risks, charges and expenses carefully before investing in a 529 savings plan. The official statement, which contains this and other information, can be obtained by calling your Financial Advisor. Read it carefully before you invest.

 Our firm is not a tax or legal advisor.

This article was written by/for Wells Fargo Advisors and provided courtesy of Michelle Floyd, CFP®, Financial Consultant of Axiom Financial Strategies Group of Wells Fargo Advisors in New Albany, IN at 812.948.8475.Visit our website at www.AxiomFSG.com.

Investments in securities and insurance products are: NOT FDIC-INSURED/NOT BANK-GUARANTEED/MAY LOSE VALUE

Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC, Member SIPC, a registered broker-dealer and non-bank affiliate of Wells Fargo & Company.

© 2017 Wells Fargo Clearing Services, LLC. All rights reserved. 0317-00230

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Money Matters by Michelle Floyd | Tired of Living Paycheck to Paycheck? Pay Yourself First

By Michelle Floyd

Are you one of the many Americans who doesn’t have a personal budget? Do you find yourself living from paycheck to paycheck, never having anything left over to save for a rainy day?  More and more of us are faced with this dilemma than we care to admit.  It seems we all have the intention of creating a budget later, but somehow later never comes.  We’re also faced with the dilemma of whether to save for retirement, children’s college, a rainy day, a vacation or countless other things that we can’t seem to prioritize and begin saving.  First, let me just say that no one likes to talk about a budget, it is the dreaded six-letter four-letter word!  Unfortunately, it is one of the most important conversations you can ever have.

How do I create a budget? I don’t know where to start.

Create a record of your expenses and income. Start by writing down everything that you’ve spent that month. There aren’t too many people who still use a check register, but your bank still has them available. Some of you may ask, “What is a check register?” Well, in the not-so-distant past we weren’t connected and online via our smartphones with balance alerts and everything else available at our fingertips. We had to keep a record of all of our purchases and deposits in a check register and wait for our monthly bank statement to come in the mail to reconcile, or balance, our checkbook. There is something to be said for that now nearly nonexistent ritual: It really helped you know where you were spending your money. After you’ve created that record of your expenses and income, do you have money left over or are you negative? If you’re negative, you truly need to take a hard look at where your money is going.

Next thing is to categorize your spending: housing (rent, mortgage), utilities, restaurants, shopping, credit card or car loan payments, to name a few. Now ask yourself, “Can I skip the coffee today? Do I really need that dress (handbag, golf club, etc.)?” More often than not, the answer is no on the coffee and yes on the dress. It may be difficult to drive past the coffee shop, but let’s put it in terms of your future. You spend $15 a day on coffee and lunch during the work week, that’s $3,900 per year. Wow!

Now comes the hard part, actually making these things happen.

So, you’ve set a goal to save $50 per week. Easy way to do that? Set up an automatic transfer from your checking to savings or update your direct deposit information so that the money goes straight to your savings without a stop in the checking account. Out of sight out of mind, right? Let’s look at that $50 per week over five years – that’s $13,000! Now, that is simple math and not including the power of compounding which we spoke so much about in our previous video and podcast (both of which you can find at ExtolMag.com). When you add in the interest element, that number quickly exceeds $13,000.

Which should I focus on first – retirement, rainy day money, debt repayment, children’s education?

This question is best answered case by case, but as a starting point, look at your employer’s retirement plan. Is there a matching component? Such as, if you contribute 3 percent of your salary they will match you 3 percent of your salary? If so, great! Let’s start there. That 3 percent match is free money! Be sure that you are contributing enough to take full advantage of the match (3% is only $3 for every $100 you make. I promise, you won’t miss it after a couple weeks). Never has anyone said to me or anyone on my team, “I wish I hadn’t saved so much for my retirement.”

Having rainy day money, or an emergency fund, is one of the most rewarding things you can do for yourself.

You never know when the washing machine is going to go out or you have to replace tires on your vehicle unexpectedly. As a general rule, you should have enough cash on hand to cover three to six months’ worth of household expenses. We start this by simply putting a few dollars away at time using the methods above. The hardest part is staying out of it! So maybe you open a savings account at a different bank than your checking. Whatever it takes to help you remain disciplined. The next part, and the harder part, is seeing the big picture and not giving in to that new trendy outfit. It is easy to set a goal, but no one else will hold you accountable.

“How am I ever going to pay for my child’s college?”

While having the goal of paying for your child’s education is wonderful, you must be able realize that you are not doing them a disservice by planning for your retirement first. Let’s face it; they don’t want you living in their basement because you planned for their college and not your retirement! We all want our kids to have it easier than we had it, and that is wonderful if you can comfortably make that happen. Just don’t sacrifice your financial well-being to make it happen.

Debt repayment is sometimes a huge mountain to climb.

Have high interest credit cards? Did you know that you can transfer the balance of that high interest credit card to a new credit card, oftentimes with little to no interest and a nominal fee? Check that out, it may save you hundreds of dollars. There are several online resources you can use to find the right credit card for you. In most cases, you can even apply and input your balance transfer information right there. Starting out with student loans, remember they were worth it. I promise you’ll thank you parents later when they still have money to retire and aren’t living in your basement. The key word to any debt is consolidation. You can consolidate your student loans into one payment. This will help you chip away at the principal faster. Have a 30-year mortgage? Keep in mind that you’re not tied to that mortgage for 30 years; you can refinance to take advantage of lower rates. Another great advantage to home ownership is the ability to access your home’s equity to – here it is again – consolidate debt.

To sum all of this up, it is up to you to determine which route makes you feel better and be able to sleep at night. Unfortunately, finances are not all dollars and cents. It is mostly behavioral.

While we all want to all be debt free and have plenty of savings, we must first take the small steps that will lead to greater strides. I encourage you to sit down and take a hard look at everything to determine what is best for you. No one else can plan for your future but you. Still have questions or need some guidance? You can check out the resources available on our website www.AxiomFSG.com or contact me for more information at michelle.floyd@wfadvisors or phone at 812.948.8475.

Wells Fargo Advisors is not a tax or legal advisor. Any estate plan should be reviewed by an attorney who specializes in estate planning and is licensed to practice law in your state. This article was written by and provided courtesy of Michelle Floyd, CFP®, Financial Consultant with Axiom Financial Strategies Group of Wells Fargo Advisors in New Albany, IN.  She can be reached via email at michelle.floyd@wfadvisors or phone at (812) 948-8475.  Visit our website at www.AxiomFSG.com. Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC. Member SIPC.   CAR 0517-02348.

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Money Matters: the Podcast | Episode 2: The Year End

A Money Matter’s Trio, Vaughan Scott, MBA, CPWA® Managing Director, Eric Ballenger, Senior Vice President – Investments and Michael Grau, CFP®, RICP®, Vice President – Investment, comes to the table and discusses the end of 2016, what the new President may or may not cause, along with a local look-in.
Money Matters: The Podcast is sponsored by Axiom Financial Strategies Group of Wells Fargo Advisors.  This quarterly podcast is in addition to a monthly article titled, “Money Matters,” that is posted online at www.ExtolMag.com and www.axiomfsg.com.

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At Axiom Financial Strategies Group of Wells Fargo Advisors we sincerely appreciate our clients making opportunities like this possible. Without their support of our business, we would not be able to support programs like this.

Michelle Floyd, CFP®  | Financial Consultant

Axiom Financial Strategies Group
of Wells Fargo Advisors
101 W Spring Street, Fifth Floor
New Albany, IN  47150

P 812.542.6475 | F 812.948.8732 | Michelle.Floyd@wellsfargoadvisors.comwww.axiomfsg.com

At Axiom Financial Strategies Group of Wells Fargo Advisors, our team caters to a select group of family-owned businesses, entrepreneurs, individuals, institutions, and foundations, helping them build, manage, preserve, and transition wealth. We accomplish this while providing top-notch service through a team approach that puts our clients’ needs, goals, and interests first. To learn more visit our website at www.axiomfsg.com. Wells Fargo Advisors. Member SIPC.

The information provided is general in nature and may not apply to your personal investment situation. Individuals should consult with their chosen financial professional before making any decisions.

Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, Member SIPC, a registered broker-dealer and non-bank affiliate of Wells Fargo & Company. CAR 1216-02739