An all to common scenario in our office is, Client A walks in, has done an excellent job of saving money, presumably enough money to retire on, yet it’s all in tax deferred, retirement vehicles that certainly have their many benefits but all too soon, this client, will begin to have to deal with the dreaded Required Minimum Distributions (at current law, age 72) and at some point those RMD’s look to become more than the client wants or needs, therefore forcing taxes on an asset that would be better to be left to a tax favored account. This is where Roth conversions earlier in your retirement lifecycle (either pre or post retirement) can make a lot of sense for the right person. Roth conversions are the process of taking pre-tax money, which could be money in your Traditional IRA, 401(k) or another pre-tax asset and moving (converting) it to your Roth IRA. This requires you paying tax today, but once in the Roth your money will start growing tax free, will be distributed tax free and there will be no Required Minimum Distributions in the future. There are a few common planning ideas around Roth conversions: The 12% Roth Conversion For those that are in the 12% tax bracket considering utilizing the rest of this bracket to complete your Roth conversions. For a married couple, the 12% federal income tax rate goes all the way up to $81,050. With a standard deduction of $25,100 that couple could earn up to $106,150 and remain in the 12% bracket. Once you go above this taxable income level the rate jumps to 22%. For non-married individuals the 12% federal income tax rate goes up to $40,525 with a standard deduction of $12,550. This means a single individual could have taxable income of up to $53,075 and still remain in the 12% bracket. Let’s say a couple’s income was going to be $75,000. With the standard deduction ($25,100) they would only pay taxes on $49,900 therefore leaving them up to $25,100 to convert to their Roth IRA while staying in the 12% bracket. If they choose to convert the entire $25,100 pushing them to the top of the 12% bracket, this would cost them $3,012 in federal income taxes. If the $3,012 tax price tag was too expensive, they could consider converting a smaller amount that would still be in the 12% tax bracket and would fit their budget. Below are examples of client’s scenarios we’ve been able to utilize the 12% tax bracket strategy: When one spouse decides to leave the workforce for a few years to care for young children or an aging parent. This provides an income drop that allows the client to now utilize the remaining 12% bracket for Roth conversions. One spouse may retire before the other because of age differences or job stress level situations. This provides the drop in income for a few years needed to maximize the 12% bracket. When a client retires, they may see a drop in their taxable income. While time is not on your side anymore there may be situations where a Roth conversion at the 12% bracket makes sense to reduce future RMD’s, that may force you into the higher brackets. Fill Out the Bracket Another idea that is common in the financial planning world is the fill out the bracket that your currently in. While this can certainly be a little costlier for high income earners, it may be prudent to explore what tax bracket you are currently in and determine if you should pursue a Roth conversion to the top of that bracket. The federal brackets today are 10%, 12%, 22%, 24%, 32%, 35% and 37%. Your decision to fill out your bracket with a Roth conversion may partly depend on your thoughts around where tax rates will be in the future but if you’re like me, you’ve got to believe they’ll be going higher over time. Stock Market Drop? Convert Last year during the height of the COVID-19 pandemic the stock market dropped over 30% at its worst. Later in the year, the market fully recovered and the S&P 500 ended the year up 18.40%. When the market dropped it provided a unique window for clients to do Roth conversions and have all the recovery happen inside of the Roth IRA. For example, an asset that was worth $10,000 may have dropped to $7,000. If the $7,000 was converted, you would owe tax on the $7,000 conversion. If the money was subsequently reinvested when it was converted the asset would have reaped all the recovery and subsequent growth inside of your Roth IRA. Get a Tax Pro As we constantly mention to our clients, please consult with your local tax professional. It’s well worth the cost to ensure you don’t make mistakes on a Roth conversion. The advisors of Whitaker-Myers Wealth Managers are happy to discuss your personal situation to determine if a Roth conversion may make sense for you.

The word of the day is VOLATILITY, and in the investment world, this word can leave a bad taste in your mouth. Is it avoidable? The answer is certainly not. As an advisor, investor, or both, we all know that volatility is a natural aspect of the stock market or any individual investment. We all wish the stock market appreciated in a perfectly straight line, but then again, it would be too easy and it would not really work the way it has for its 100+ year history if that were the case. With a long-term investing horizon in which natural volatility of the market can be handled, we do make the argument that the stock market is the best place to be for general investing or retirement investing if you are investing intentionally and intelligently. A short-term need for regular income or withdrawal of investable assets tells us that a 100% stock market strategy should almost never be in place due to the natural volatility of the market. However, it does not mean that you cannot aim for great returns while attempting to minimize volatility to the best of your ability, and that is one of the many small aspects of our work that we help clients not only understand but attempt to achieve over a long period of time. In the investment world, we like to have fancy terms, and two additional terms to focus on today are systematic risk and unsystematic risk. Let’s think of these two definitions in a simpler sense: systematic risk is simply the natural risk of the stock market as a whole, and that heavily involves the concept of VOLATILITY. Unsystematic risk involves the risk of investing in only one company, one industry or sector of the economy, one country or geographical area, etc. Long story short, systematic risk is the risk that we essentially cannot do anything about, with understanding that the market does not go up in a perfectly straight line. Unsystematic risk is diversifiable, meaning that with an intelligent or successful strategy, it can be mostly diversified away. As an advising firm that works in the best interest of our clients first, we care about the appropriateness to a particular situation, merit, and long-term track record of a mutual fund or alternative investment. However, that does not mean we chase returns, or necessarily care only about the long-term return of an individual investment. We certainly utilize Dave Ramsey’s general investment strategy of investing in four different types of mutual funds or in more broad terms, four different categories or “sectors” of the stock market as a whole: Growth, Growth & Income, Aggressive Growth, and International. *See the chart... data is from 10+ years ago but overall concept is the furthest thing from being outdated (: As a company, we are huge Dave Ramsey fans, but we don’t just take his word on this strategy. More so, this strategy aims to minimize that unsystematic risk and the volatility of returns as much as possible. Please don’t let anyone tell you that you should either just invest in the Amazons, Googles, and Facebooks of today or in the smaller companies that could be the next Amazon, Google, or Facebook. Notice the discrepancy in returns for those small growth stocks (aggressive growth) between the years 2002 and 2003, or the difference in returns of large growth stocks from 1999 to 2000. This is volatility that you should not want to be subject to by being too concentrated in one specific area of the market, and I am going to make this argument with a mix of statements and calculations: The vast majority of investors fail at timing the market constantly and with chasing short-term returns Not only beating the market when the market does well is important, but losing less than the market when the market is down is just as if not more important Often times but not always, when 2 or 3 of these categories are doing really well, 1 or 2 categories are not doing so well and vice versa Example: Recent tax increases concern many investors that the market will see a pullback at some point. This may or may not be a valid argument in the short-term, however, these companies will do their absolute best to push the cost of tax increase to another party, whether it involves conducting more business overseas to deal with lower foreign taxes, outsourcing cheaper labor or more aggressively, or passing cost off to the customer. Regardless, this is just one small and specific example of why we believe allocating roughly 25% of stock investments internationally. When you simply look at the arithmetic average of returns over a long period of time, volatility has a directly correlated relationship with average annual (or another time period) return. More volatility = more negative affect on the long-term growth of an investment. Let’s look at an initial investment of $100. If you achieve 0% return in year 1 and 0% return in year 2, it should be obvious what you end with: $100. The average return for these two years on an annual basis is 0%. Let’s look at the same initial investment of $100. If you achieve 50% return in year 1 and -50% loss in year 2, you might think you end with $100. When in reality, you would actually end with $75, a 25% loss overall. The average annual return in a purely arithmetic sense in this scenario is still 0%. The same result is seen with -50% loss in year 1 and 50% return in year 2: -25% loss overall… or a $100 investment turning into $75 after 2 years. Another example: A $100 investment into small growth stocks as a whole at the beginning of 2002 leaves you with only $103.59 after 2 years (3.59% overall return) even though your average return between the 2 years was roughly 9% (-30.26% + 48.54%/2). A $100 investment into the overall bond market at the beginning of 2003 leaves you with just under $109 after 2 years (just under 9% overall return for the 2-year period) even though the average annual return between the 2 years was just over 4%. Takeaway: When you are looking simply at average mathematical returns, the only thing that volatility does is hurt you, and it is ultra-important to have a strategy that attempts to minimize volatility. If you are an existing client of ours and have questions regarding this concept, please don’t hesitate to contact your advisor. If you are not, hopefully this was a great initial learning piece as a new reader!

You too can create good habits, learn new behaviors, develop effective skills, and make decisions with confidence wherever you might find yourself today. As your coach, we will work together, tailor plans, and I will help you to realize your life and money dreams. I want you to feel comfortable and confident about your life and your money. My wife and I have personally walked these steps during the past 30+ years. We spent ½ of our marriage doing things the wrong way before spending the second ½ doing them the right way. I will help you to go further faster because I have been there and can show you the way. So, where do you find yourself today? See how I can help you to navigate every step of your journey. Let Us Begin to Take These Baby Steps Together Step # 1: Save a Beginner Emergency Fund The first and sometimes the hardest baby step is saving your beginner emergency fund. We are going to create an effective spending plan, give every dollar a purpose, and save an emergency fund. As your coach, you can trust me to help you with a personalized strategy to do so. And, doing so makes all the difference. You will receive judgment-free personalized attention, compassion, love, and support from me as your coach. Step # 2: Eliminate Debt How will it feel when you are completely debt-free of all non-mortgage debt? Leveraging the skills and strategy from step # 1, we are going to attack the debt with high intensity to get it out of your life once and for all. As your coach, I show you the way with milestones and celebration to help to motivate you to keep going and realize success. I walk with you during your journey and help you with the habits, skills, and behaviors to get it done. Step # 3: Save Your Emergency Fund Great job completing steps # 1 and # 2. Now, we are having fun, saving money, and building security for yourself and your family. You now have the skills necessary to realize success and during this baby step, you are going to save either a 3-month or 6-month emergency fund. As your coach, I am going to help you determine how much to save, why, and where to put it. This is an essential part of your overall financial plan. Step # 4: Invest for Retirement We are going to partner with an excellent financial advisor to invest your hard-earned resources to create financial freedom. As your coach, I am going to help you to design a plan, outline questions to ask, and help you to select an advisor who is going to represent you and your interests well. We are also going to outline together the amount that you may want to save to realize the retirement of your dreams and why. Step # 5: Save for College Education Take a moment and think about the joy and blessing of contributing to your child’s college education. We are going to leverage the partnership with the excellent financial advisor from step # 5 to optimally invest your college funds for your child. We are also going to talk about options, experiences, and how my wife and I paid cash for three children to graduate from college debt-free. Step # 6: Pay off Your Mortgage And, for the Coup de Grâce, get debt out of your life once and for all. You too can pay off your home mortgage! As your coach, I am going to show you how to achieve the ultimate in debt freedom by paying off your home too! Step # 7: Live and Give Like No One Else So, why do we want to rid ourselves of debt, build savings, save for a comfortable retirement, help our child with college, and completely payoff our home? To build God’s Kingdom. We have an opportunity to live and give like no one else. As your coach, I am going to offer ideas and help you to build relationships within your household and within your community. The most fun you will ever have with money is to bless others. Let us get started with a no-obligation introductory session. We will meet each other, review possibilities, and you decide if coaching is the right path for you and your family. You can schedule a time and date convenient for you at www.jm-financialcoaching.com.

Those of us that love and respect Dave Ramsey have heard him say that there are two types of investments he makes on a regular basis. The first, being mutual fund investing based on his principals of diversification (Growth, Growth & Income, Aggressive Growth & International) and also paid for, in cash, real estate. This leads many clients to ask the question, should I be purchasing real estate within my global investment strategy and how does it compare to the investing I may be doing into mutual funds? Great question and let’s take a look below. Before you dive into scenarios of what returns could look like in either mutual fund investing and real estate investing let’s discuss some basic foundational principals. First, I am assuming that the person considering buying real estate would be looking at a below $1 million property (commercial or residential) and would be buying the property after they have hit Baby Step 7 and are still actively contributing to Baby Step 4 and perhaps Baby Step 5 (if applicable). The investor would buy the property with all cash so as to not go back into debt therefore allowing the piece of real estate to be a blessing and not a potential curse. If there is a mortgage on the property and the rent stops paying for 3 months (which trust me can and will happen at some point) you don’t want to have to worry about finding the money to pay the mortgage. If you need a refresher on the 7 Baby Steps please visit Dave’s website www.daveramsey.com to catch up. Within real estate investing there are three types of return to be generated. Value increase (or potential decrease) of the property based on real estate values in the general proximity of your piece of real estate. Cash flow from the property which is derived from the rent paid to you from your tenant, whether they be a renter or commercial tenant. Finally, Deprecation of the property provides a tax incentive to own real estate because you’re able to depreciate the value of the real estate offsetting some the income, potentially saving you tax dollars. Stock Market investing most commonly would see only two of these three potential sources of return which are value increase (or decrease) and cash flow, to the extent the stock investment is paying a dividend (the shareholders portion of the profits paid to them). Let’s run through a quick example: Johnny buys a piece of residential real estate for $80,000 and intends to rent the property for $800 / month. After he accounts for maintenance and other potential repairs he plans on clearing for himself $600 / month. The property is in an area that has historically seen a 2% increase in real estate prices annually. The depreciation value is about $560 in tax savings. Johnny’s annual return is 9.70% ($7,200 annual rent + tax savings) +2% appreciation on property = 11.70% return. If Johnny were to increase the rent to $1,000 and clear $800 / month, it would increase his total return to 14.7%. Historically over the last thirty years 1991 – 2020 the stock market (using the S&P 500) has averaged 10.70% per year. There are certainly things we didn’t account for within this example (renter trashes your home or real estate market crashes hence the value of the property plummets) but this gives you a general of idea of how one might consider the return of a piece of real estate against the mutual fund investing you might be doing through your advisor at Whitaker-Myers Wealth Managers. One final factor to consider, is what is commonly called the “hassle factor”. Your mutual fund investments are not going to call and bug you about a broken dish washer or that they don’t like the curtains you put up in the living room. For some people, especially those that are not inclined to fix things themselves, this increased workload from their investments, which in turn could take away from family, relaxation or just general personal non-work time, might create a scenario where an investor may prefer to be in mutual fund options that just provide them a monthly statement and that is the extent to which they are bugged about the investment. Real estate investing for the right person might provide them with an attractive risk / return opportunity, but certainly is not appropriate for everyone. Your advisor at Whitaker-Myers Wealth Managers is happy to discuss the pros and cons of this scenario in addition to modeling the potential real estate purchase in your financial plan.

Having read the title of this article, it will inform you that my goal is to explain the main benefits of using a dollar-cost averaging investing strategy. However, first, it is important to understand what a dollar-cost averaging strategy entails, and there is a great chance that you as the reader may already be committing to this strategy without even realizing it! To put it briefly, let’s say you are putting 5% of your income into mutual funds in your 401(k), then you would be using a dollar-cost averaging strategy regardless of the specific frequency of those retirement contributions as long as they are consistent (weekly, biweekly, monthly, etc.) This strategy simply involves investing the same amount of money at these set intervals into stock mutual funds and/or other applicable investments, regardless of price-per-share of those mutual funds. Therefore, by investing with a consistent dollar basis, instead of on a per-share basis, you will buy more shares when the mutual fund(s) is “cheaper”. (Think when the market is “down”.) You will buy less shares when the mutual fund(s) is “more expensive.” (Think when the market is “up”.) Initially, many advisors and investment firms turn their heads to potential clients that don’t have large sums of money to invest. They try to discourage dollar-cost-averaging knowing that it is a beneficial and proven investing strategy for a vast array of people that significantly reduces market timing risk. This can mean less assets up front to take an initial investment management fee or a commission check. (P.S. As a friendly reminder, watch out for commission-based compensation structures.) I say this because we, at Whitaker-Myers, do not operate that way. There are two main things, among many more, that our advisors and company take pride in: working with and providing great advice, service, and strategies to our clients with THEIR best interest in mind and having the heart of a teacher. If you, the reader, are not an existing client and/or don’t know much or anything about our company, I hope the latter point shows through with this information. What Are the Benefits? I would like to dive into the benefits of implementing and using this strategy. I have also included a picture, with credit to Franklin Templeton, that shows a hypothetical illustration or case scenario of using this strategy with results in better investment returns then investing the same amount of dollars, on day one, with a lump-sum. However, the argument for dollar-cost averaging is not completely or even mostly mathematical or return-based in nature. In fact, when you think about the history of the stock market and the fact that it has provided substantial returns with ups and downs along the way, you will generally have a better chance of more substantial returns with an initial lump sum vs. spreading out that same lump into twelve monthly contributions in a one-year period. Although this is not an exact or concrete statistic, we are on par with Dave Ramsey when he says that finances, investing and underlying decisions are about 80% emotional or psychological and about 20% head knowledge. We would also argue that a perfect world or place to be for an investor would be the use of 100% head knowledge, but this is unrealistic with money, and we understand that. While most of us inherently know that buying low and selling high is a general benefit, many end up committing to the opposite. For the majority of people, the immediate thought when they see their investments decline, in the short-term, is to sell because of the uncontrollable fear of “How much more can I lose?”. Also, for the majority of people, the immediate thought when they see their investments appreciate in the short-term is “How much more can I make before selling?”. Dollar-cost-averaging is especially made to be a long-term buying strategy and a behavioral or psychological benefit: Dollar-cost-averaging lets you take on the position of timing the market by purchasing more shares of said investment when cheap and less shares are more expensive. This is in the most modest and least-risk inducing way. The majority of people are not in the position to invest in large lump sums in the first place. It’s beneficial for the overwhelming majority of investors to commit to a simple and disciplined investing habit or plan. Pinpoint market timing is nearly impossible, even for professional investors. • Regret and negative results WILL occur with poorly timed lump-sum investing. If committed to the strategy, you are committing to using bear markets, automatically, as a buying opportunity. Those who try to time the market completely have a historically better chance of failing than succeeding. Overall, this strategy allows those who use it to aim for great returns over a long period of time. This allows them to take on a much lesser risk that essentially equates to a more positive, emotional and psychological result.

If you are going to college to be a teacher, the Teacher Education Assistance for College and Higher Education (TEACH) Grant might be beneficial for you. Let’s look at what it is and who is eligible. What is the TEACH Grant? The TEACH Grant Program provides grants of up to $4,000/year to student who are going to college in order to begin a career in teaching. This grant is a little different from other Federal grants because it requires you to complete four years of qualifying teaching. If you don’t complete that teaching obligation, then the grant turns into a direct unsubsidized loan that must be repaid in full with interest. The interest will be charged from the date the TEACH Grant was given. As you know, we follow Dave Ramsey’s principles around here so we would advise you to only take this grant if you are 100% sure that you will fulfill the teaching obligation so that this remains a grant and does NOT turn into a loan. If you receive the TEACH Grant, you will be required to sign a TEACH Grant Agreement to Serve where you agree to teach in a high need field, at an elementary school, secondary school, or educational service agency that serves low-income families, and complete at least four academic years within eight years after completing the course of study for which you received the TEACH Grant. Schools that participate in the TEACH Grant Program determine which programs that they offer are eligible for the TEACH Grant. For this reason, you should contact your Financial Aid office to discuss this grant. Who is eligible for the TEACH Grant? Here are some of the eligibility requirements for the TEACH Grant: Meet the eligibility criteria for federal student aid Complete the FAFSA Be enrolled at a college that participates in the TEACH Grant Program Be enrolled in a program that is eligible for the TEACH Grant Meet certain academic achievement requirements Receive TEACH Grant counseling Sign a TEACH Grant Agreement to Serve (mentioned above) To ensure that you are eligible for the TEACH Grant, it is recommended that you discuss it with your school’s Financial Aid office. This article was intended to give you an introduction and basic overview of the TEACH Grant, if you are interested in learning more, you can read more at studentaid.gov.

In the absence of hope, despair and status-quo become acceptable. This is the feeling I get when talking to many families about the chances they feel their children will be able to get through college debt free. No hope so status quo (student loans) become acceptable. Perhaps a family hasn’t had the means to save because of poor financial habits in the past and now, after getting connected to Dave Ramsey and Ramsey Solutions, they’ve finally found their way out of debt, built an emergency fund, yet one problem – their child is 16 and they’re staring down the barrel of almost nothing saved for college. What’s an advisor like us to say to this client? Perhaps we could tell them that over the next two years they could save $1,890.58 / month and at a 10% rate of return they’d have approx. $50,000. Yet, as you’re probably thinking, who has $1,890 / month laying around, especially considering you should not put your retirement on hold (Baby Step 4 is before Baby Step 5, right!) to fund your kids’ college. Good news, as an eternal optimist, because I believe in the power of positive thinking and positive attitudes, we’ve got some excellent recommendations to guide your student through college debt free. Of course, you can always find reasons, why YOUR child won’t be able to do some of the things we recommend in this article and if that’s you, I don’t think there is much we can do to help you, however if you’re open to ideas and suggestions let’s walk down this road together. First things, first Just like in real estate, where the common phrase “Money is made at the buy” is so important to your ability to be successful as a real estate investor, college success is dictated, many times by school choice. For example, according to collegecalc.org, colleges in Ohio can be as cheap as $2,802 / year (Belmont Technical College) to $54,346 / year (Oberlin College). Let’s say that little Johnny, tells us he wants to go to The Ohio State University. We know that tuition costs at main campus are going to run us $9,852 however we’ll also have to fork out the cost of dorm, food, car, etc. because Johnny will have to move down to Columbus. Instead we know that we could send him to the Mansfield Regional Campus (assuming we live in or around Mansfield) for $7,416. Or we could send them to the Wooster Regional Campus for $7,416. Thus, saving an additional, $2,400 / year plus the costs of room, board & other misc. expenses. Now this may not be what Johnny wants to do but remember, you are still the adult and it gives you a great opportunity to teach Johnny about economics such as, what economic benefit are you getting for the additional $2,400 / year plus expenses? Nothing at all! Tuition Reimbursement Programs One of my favorite pieces of advice is tuition reimbursement programs at some of the best employers for young people. This is exactly what I did when going through college and it was extremely helpful in two ways. First, it allowed me to keep my out of pocket costs for college to a minimum but additionally because I was juggling 20 – 25 hours (sometimes more) of work along with my school schedule, I learned the importance of time management and built a resume while in school. So here are some great examples of employers that will provide tuition reimbursement and the amount they reimburse in parentheses. AT&T ($5,250 after 6 months at company) Bank of America or probably any bank for that matter. I worked for PNC Bank, they paid for most of my MBA ($5,250 after 6 months at company) Chipotle ($5,250 or 100% of tuition yearly if you enroll in one of the specific degrees offered through their partner programs) Home Depot ($1,500 per year for part time hourly workers) Starbucks (full tuition to Arizona State University online degree program after working 240 hours and continuing to work 20 hours per week) UPS ($5,250 for part time and full-time employees from day 1) Walmart ($1 per day cost for part- & full-time employees to earn college degrees in demand fields at one of their online partner colleges). Target ($3,000 per year) Verizon – another favorite of mine because I worked with them one year during undergrad and they paid all my tuition that year ($8,000 / year if the degree is applicable to Verizon operation or $5,250 if not). Lowe’s ($2,500 / year for full time employees with one year of service) Chick-fil-A (Tuition discounts and grants for more than 100 colleges and universities that partner with them). Best Buy ($3,500 per year if you work 32 hours / week) Fidelity (90% of education costs with a maximum payment of $10,000 per year, after 6 months of service). Scholarship Search & Apply As Dave Ramsey says, during your child’s senior year, their full-time job should be searching for and applying for college scholarships. A simple Google search will yield a couple websites to visit to narrow down scholarships your child might be well suited for. A favorite of mine is https://bigfuture.collegeboard.org/scholarship-search They have scholarships and internships for more than 2,200 programs, totaling nearly $6 billion. A board of directors I once sat on, had a $1,000 scholarship they gave each year. Sadly, for the three years I sat on their board, we only had about two kids apply for the scholarship each year (50% chance!). Imagine, with great school choice, such as The Ohio State University Mansfield Campus, example above, how even $1,000 could have a huge impact (15% of your costs would be covered). How did Johnny do? In our hypothetical example above, Johnny has decided to attend The Ohio State University Mansfield Campus which means he’ll need to come up with $7,416 per year. Mom & Dad (you) have decided you’ll help cover $1,200 of the cost ($100 / month). Johnny applied for and received a $500 scholarship from his local community bank. He also got a job at UPS working from 7am – 10am each morning, meaning he’ll need to take afternoon classes – no big deal! He gets paid $14 / hour (my guess) which is $252 / week on a six-day workweek. Guess what – that’s his spending money because between his scholarship, $1,200 from you, $500 from his scholarship and the $5,250 that UPS will reimburse him for he is out almost nothing. Some of you may be instantly thinking my child can’t work while in school. They need to focus on school! Well, you’re wrong! According to a study done by the National Center for Educational Statistics (https://nces.ed.gov/pubs94/94311.pdf) among full time, full year undergraduates those working only 1-15 hours per week while enrolled were more likely to have GPA’s around 3.5 or higher. Acknowledging the fact that you have little saved is the first step. The second step shouldn’t be to instantly pursue student loan options. Create a plan for your child, that helps them to create life long skills instead of burdening them with life long debt. As always, your Whitaker-Myers Wealth Managers Financial Advisor is here to help you take those steps towards financial freedom.

Imagine making the short drive to your local grocery store. It’s a drive you’ve made so many times that you’re practically on auto pilot. So much so that you don’t see a young man riding his motorcycle towards you and you turn in front of him. The accident sees him life flighted to the hospital where he’s in the ICU for several days. He survives, but his injuries are significant, his ability to provide for his family is in jeopardy, and full recovery seems out of the question. Who will pay his medical bills? What about pain and suffering? Your auto insurer is responsible for the injuries sustained, but there has to be a limit, right? What if you selected state minimum coverages when you purchased auto insurance? In Ohio, that’s $25,000 per person to pay bodily injury. Or, your agent recommended limits of $100,000 or even $300,000 -- surely that’s enough? In this example, even $300,000 wouldn’t be enough. If you don’t have an umbrella policy, you could be responsible for whatever your auto policy doesn’t cover. Imagine your home and personal assets at risk. Because without an umbrella, they are. Put simply, an umbrella policy is a layer of liability that is excess over your home and auto insurance. Generally, umbrella policies are available in increments of $1MM. They provide a layer of protection against significant claims that could result in financial devastation. The story at the beginning of this article is true. The young man on the motorcycle is a dear friend of mine and fellow pastor of our church. He has 4 young kids, and a 5th on the way. His life will never be the same. And accidents like this happen every day. Are you properly protected? Or are you risking everything? I’d be happy to review your home and auto insurance to make sure you are properly protected. And don’t be tempted to think you can’t afford an umbrella policy. Lots of factors determine the price but, generally, an umbrella policy will only cost between $125 and $200/year, for each $1MM layer. You’ve worked hard to be wise with your money, pay down debt, invest well, and build wealth. Why risk everything, when adding an umbrella policy is only a phone call away? *Insurance products offered through Whitaker-Myers Insurance Group and licensed agents.

Tomorrow is October 1st which means that we are heading into the holiday season! This is the time of year when it seems as though there are expenses that can sneak up on us if we don't plan ahead for them. Here are a few items that you might want to add into your October budget. Decorations & Pumpkins - Whether you are decorating for the season or getting pumpkins for the kids to carve, it is the time of year to be stopping by the pumpkin patch! Family Pictures - This is the time of year that many people get their family pictures taken for Christmas cards and that sort of thing. Costumes - It's time to be buying a costume for the kids if you celebrate Halloween! Gifts - Whether you are buying hostess gifts or starting to plan ahead for Christmas, it is a good idea to add this into your budget as early as possible. We are big fans of Dave Ramsey's advice to save all year for Christmas gifts because then it isn't such a hit to your budget in the last couple of months. Apple Picking - Many local orchards have U-Pick apple picking going on and this can be a cheaper (and more fun) way to get your apples but it is more of a cost up-front since you typically buy a bigger bag than what you would in the store. Candy - Whether you are giving out candy for Halloween or just buying it for yourself, this is that wonderful time of the year where all the mini candy bars are available and they are hard to resist when you walk past them in the store. Just me?! Travel - I know we are all traveling less right now but if traveling is in the plans for the holidays, starting to build it into the budget now will help you spread out the expense over a couple of months! Hopefully this got you thinking about things you might need or want to add into your October budget. If you are looking for ways to save money and/or make extra money, check out this article from Dave Ramsey's budgeting program, EveryDollar: October Challenge: Scare up Some Extra Cash for Halloween

I recently went on New Day Cleveland to share some Quarantine Budget Tips and I wanted to share them here as well. This pandemic has impacted all of us in one way or another and as we know, money touches all areas of our lives, so here are a few tips that might help you when it comes to your life and money right now. Emergency Fund – We all know that we should have an emergency fund but when things are going well, it doesn’t always seem urgent or important to save. Unfortunately, I think this pandemic made us all realize how quickly an emergency can happen. If you found yourself without an emergency fund during this time, give yourself grace – that has happened to all of us, but use this as motivation to start the habit of saving every month, even when things are going well…. Especially when things are going well. Emergencies happen and building in this habit of saving will allow you to have a cushion between you and life the next time something happens. Continue and/or Start Meal Plan/Prep – Meal planning and prepping is a common money saving tip because it helps reduce the amount of money you spend going out to eat. I bring this up here because since many people are home more often it might seem less important to plan and prep dinner, but the reality is you are likely still working, doing virtual school, etc and dinner time can sneak up on you before you know it and if you don’t have plan, you might spend more grabbing take-out. Use Amazon Smile to donate to your favorite charities when you shop! - This tip won’t help you save money but will help your dollar go further when you are shopping with Amazon. You can go to smile.amazon.com and select the charity you would like to support and then every time you make a purchase with Amazon, they will donate a portion to that charity. It doesn’t cost you anymore do to this either! Use online cash-back and coupon programs such a Rakuten (Ebates) and Honey. - A lot of us are shopping online more often and a good way to save money is to use the cash back and coupon apps/programs. Rakuten (used to be Ebates) is a cash back program. The way to use it is by going to the Rakuten website or app first and then navigating to the website you want to shop with. If that website participates in the Rakuten program, you will earn a percentage back and that comes in the form of a check paid out quarterly by Rakuten. Honey is a program that searches for coupon codes when you go to checkout with a website. You can add it as an extension on your browser and then when you get to the checkout screen, Honey will search for active coupon codes for you to use. Hopefully some of these tips help you with saving some money during this time! If you have any questions or want to discuss your specific financial situation, please feel free to reach out to one of us. You can meet our team of advisors here.

How We View Social Security: Most people understand the basics of social security and why/how it is used, and we also understand that it has been a critical systematic financial instrument for millions of Americans for decades. The positive side of social security is that, if it was completely wiped out today, millions of Americans would have no where to go for income in retirement. It has also been a long-term way to almost “force” people to save for retirement, which should be thought of beneficially in the sense that many receiving SS today would not have planned accordingly themselves. The more negative side is that the average modern-day American should not be hoping or forecasting to eclipse his/her lifetime of contributions with the benefits that will be received, and that social security can generally and simply be thought of as a “bad deal.” Also, especially with younger adults, no aspect of social security today should be thought of as “guaranteed” for the future, especially with a recent history of pushing back what is thought of as retirement age, the impact of baby boomers, and continually increasing life expectancies. The objective here is not to host a roast towards social security or to argue whether it should exist or be treated the same in the future, but rather be dually educational and hopefully persuasive. While most understand the basics of SS, we believe that most do not have the right attitude towards it or even relationship with it, and growing in this area will be critical when thinking about social security’s tax implications. Social Security can be Taxable: What Does this Mean for You? Whether you as the reader are an existing client, a potential client, or just someone who has any sort of retirement goal/plan, we are stressing that a healthy attitude towards social security is an attitude of non-dependence that coincides with proper retirement planning. The average monthly SS benefit in 2020 is just above $1,500 a month, which equates to $18,000 in annual income. With relying on SS alone, it is very possible to put in 40 years of hard work and make an honest living, just to live paycheck to paycheck and lack financial freedom in retirement. The great thing about us and other fiduciary-based investment advisors is that we are in the business of helping YOU create and control your income and assets in retirement with your best interest always coming first. So many aspects of the investment world and finance industry are situational, and that is especially true when thinking about clients in general. It should go without saying that no two clients are exactly alike, and that all situations, goals, constraints, etc. are never going to be the same across the board. However, the nature and execution of our business is directed at producing a result opposite to relying on social security in retirement. For all of our clients, we want SS to be nothing more than a small “cherry on top” when comparing to other income-producing instruments and retirement assets. When considering this, and the fact that social security CAN be taxable on the federal level, it’s easier to understand why we actually hope and believe that all of our clients will have to pay federal taxes on social security. Next, you will see the guidelines/income brackets for the federal taxation of SS and why ‘tax’ can be thought of as an unusual positive in this sense. Tax and Income Guidelines: A portion of social security benefits may be taxable, and here are the current guidelines to follow: *For all of these situations, consider one half or 50% of annual social security for each individual and add it to other income which can include wages, pension, interest, dividends, and capital gains. Up to 50% of SS benefits may be taxable if: Annual income is $25,000-$34,000 for filing as single, head of household, or qualifying widow/widower Annual income is $25,000-$34,000 for married filing separately (have to live separately for entire preceding year) Annual income is $32,000-$44,000 for married filing jointly (consider one half of annual social security income from each spouse) Up to 85% of SS benefits may be taxable if: Annual income is more than $34,000 for filing as single, head of household, or qualifying widow/widower Annual income is more than $34,000 for married filing separately (have to live separately) Anyone for married filing separately that lived with their spouse for any amount of time in the preceding year Annual income is more than $44,000 for married filing jointly Key Points: With proper retirement planning, you can expect to pay some portion of tax on social security benefits when considering the combined income of SS and portfolio distributions (interest, capital gains, dividends) and/or pension income Again, this is a rare case when you actually want to pay taxes, because if you weren’t, it would obviously be due to your retirement income being lower than the limits A typical client is forecasted to live on a comfortable and satisfying retirement income that considers the client’s desires and wishes and the reasonability, suitability, and tradeoffs behind them that will easily surpass these limits while still allowing average portfolio growth to exceed distributions

Fall in Ohio is a magical time, isn’t it? The heat of the summer is dissipating yet the sting of winter’s cold days is far enough off that we aren’t yet worried. There is no greater place to spend your September and October months than in this beautiful state watching a high school football or soccer game. However, once every four years the beauty of God’s creation here in Ohio comes under a little stress as one of the great battle ground states in the Presential election. That often leads to a series of questions from clients around, how should my investment strategy change during an election year? The perception is, because there is uncertainty and perhaps a new President that you may or may not agree with, that will crash the stock market and along with that crash, you’ll see your savings drop. As an advisor to many families across Ohio, South Carolina, Georgia, Florida and Texas, we as a firm need to understand if this assumption is reality and if so, how should we react. This article hopefully helps you to see our perception of the election and stock market. Studies on Election Years and Market Returns Dimensional Funds, a respected fund company, based out of Austin, Texas did a study in 2019 showing that the stock market has been positive overall in 19 of the last 23 election years from 1928-2016. We have posted the chart below that shows the S&P 500 total returns during each election year dating back to 1928. The most recent examples of a negative stock market annual return in an election year, have been in 2008, which was not the result of an election but rather the result of a global financial crisis brought on by the one thing that we hate more than anything DEBT! The second most recent example of a negative total return for the S&P during an election year, was the 2000 election which featured President Clinton’s VP in Al Gore and his Republican counterpart, George W. Bush. More academic research on the topic, by Yale Hirsch, who wrote the book, The Stock Traders Almanac, and furthered by Pepperdine professor Marshall Nickles in a paper called, “Presential Elections and Stock Market Cycles,” has presented data that shows it’s actually best to invest on Oct. 1st of the 2nd year of presential term and sell on December 31st of year four. Therefore, their research says, don’t sell out during the election year because it’s part of what has historically been some of the best years of a President’s term. Furthermore when studying returns, data does show that returns are better in midterm election years as opposed to non-midterm years and I believe this is very explainable in the fact that the stock market doesn’t like uncertainty, so when the leader of the free world is somewhat uncertain (although narrowed down to two people) that would generally impact returns. Notice, I didn’t say, that non-midterm years were negative though. Therefore should you sell out of your investments just because the returns are not as good as they’d be in another year? Certainly Not! You Can’t Outsmart the Market Dave Ramsey says the best book for investing is Aesop’s Fable, The Tortoise and the Hare. Why? Many of us get sidetracked from our investing strategy from all these outside issues that may or may not have an impact on the market. The bottom line, many times is, if we held to our strategy, we’d do better than trying to outsmart the market. One question, you could honestly ask yourself, in March of 2020, if I could have pushed a button and said I’ll just take a 0% return for 2020 as opposed to the negative return your statement was showing at that point, would you have taken it? Many probably would, however had you stayed true to your strategy today you’re in a much better place, just six short months later. It’s hard to time, outsmart and be better than the market because there are so many factors you can’t anticipate. As you’re probably reading or hearing, the Presidential race is tight and as of today there is no clear-cut winner. Don’t let that impact of what-if’s, maybe’s or that might happen, effect the strategy you have in place for your family’s financial future. Market drops will always happen, Presidential election or not, thus your primary concern when investing should be your goals and objectives for your money, not who is moving into or out of the White House. Dave Ramsey always says, you control your outcome not the President so don’t let them dictate your investment decisions.