I track all of our family’s expenses and make plans for all of our spending every month. I’ve been faithfully budgeting and living frugally for thirteen years. You might not think that doing a budget audit would yield very many opportunities for saving when our family is already locked into budgeting and frugality. I’m excited to surprise you! We are in the middle of a tight financial season right now due to multiple reasons. I […]

Before you set a single budget limit, log everything you spend for 30 days and don’t cut back yet. Guesses about spending run low, so limits built from memory start out too tight. A month of real numbers shows where your money goes, and you build the budget on what you spend instead of what you remember. Source

The scariest thing on a physician’s desk this October is the fourth-quarter estimated tax worksheet, propped against a 403(b) statement … Read more

When parents leave their entire estate to one child, the financial consequences can be substantial, but the emotional damage may last even longer. Understanding inheritance rights and discussing estate plans early can help families avoid costly disputes. (Pexels). Imagine discovering that your parents plan to leave their entire estate to your brother or sister, even though you have always maintained a close relationship with them. Maybe you helped with medical appointments, visited regularly, and contributed […]

One objective of tax planning is to limit income taxes paid during one’s lifetime.  To my mind, it is exceedingly difficult to present an entire adult lifetime tax arc in a single projection or spreadsheet. This is for many reasons, including the fact that we don’t know the date of death. What I think has […]

Firstly, thank you to everybody who purchased the new book Household Cybersecurity over this last week! If you have any questions about the material, feel free to ask, as you’re probably not the only person with that same question. If you found the book to be helpful, please consider leaving a review on Amazon (or Goodreads), as that’s the best way to help others find the book. Other Recommended Reading 4 Practical Uses of TIPS […]

As Benjamin Franklin famously put it in a Constitution Center letter from 1789: “In this world nothing can be said to be certain, except death and taxes,” these two things, death and taxes, are certainties … Read more

DIY Investing vs. A Financial Planner: What Each Really Costs You Over 25 Years Are you wondering whether to hire a financial planner or DIY invest on your own? I hear this question all the time, and it’s personal for me right now, which I’ll explain below. Start with the number that gets everyone’s attention: a 1% fee. The average financial advisor charges approximately one percent of assets under management. It sounds like nothing. But on a $500,000 portfolio, that’s $5,000 a year, and over 25 years it can cost you more than half a million dollars. And that’s assuming that your portfolio value remains constant! This article may contain affiliate links which means that – at zero cost to you – I might earn a commission if you sign up or buy through the affiliate link. Does that mean you should never hire a financial planner? Not exactly. Let’s break down who should DIY, who should hire help, and the middle option that most people overlook. The Math: What a 1% Fee Really Costs Say you invest $500,000 and earn 7% a year for 25 years. With no advisory fee, you end up with about $2.7 million. With a 1% fee, your return drops to about 6%, and you end up with about $2.1 million. Same portfolio, same market. Roughly half a million dollars or more goes to fees. The Case for DIY Investing Self-directed, or DIY investing has a lot going for it. Lower cost. A simple portfolio of low-cost index funds or ETFs can cost a fraction of a percent per year. A basic U.S. stock market index fund like Vanguard Morningstar Total Stock Market ETF (VTI) has an expense ratio of 0.03%, while an international stock ETF like Vanguard FTSE Developed Markets Index Fund ETF Shares (VEA) charges the same low rate. On a $100,000 investment, the annual expense ratio of 0.03% equals $30. No additional fees apply! Full control. You decide what you own and when you change it. With a modicum of financial and investment education, you can learn how to to invest, and decide which investments fit your goals. Simplicity. A basic three-fund portfolio of U.S. stocks, international stocks and bonds does the job. Since each ETF owns thousands of individual companies, three ETFs offer excellent diversification. Solid performance. If you worry that a planner will deliver higher returns, that’s debatable. Plenty of data suggests index funds, which mirror the market, generally outperform most actively managed strategies. Tax efficiency. Taxes also make a difference when investing. In a taxable investment brokerage account, trading can rack up short term gains, which might up your tax bill. Whereas, investing in index funds, which have minimal turnover, tends to keep taxable gains at bay. [embed]https://youtube.com/watch?v=oHvlSW9iDCM&si=Ko7nc9FUtbfSzGmy[/embed] The Case for a Financial Planner A good planner is not just building your portfolio. You’re paying for something very different from asset management. Behavior coaching. The biggest wealth killer isn’t necessarily fees. It’s panic selling in a