MONEY MATTERS
• Computer Costs
• Financial strategies for retirement
• Common giving scams
• Preparing for a lengthy renovation
• Considerations for your second act
• Tips to save when inflation is high
Financial strategies to consider as retirement draws near
Freedom is often cited as a benefit of retirement. Many professionals look forward to the day when they retire and have more free time and the freedom to spend that time however they choose. Of course, the opportunity to spend retirement how one sees fit typically requires considerable financial freedom.
Financial planning for retirement is often emphasized to young professionals beginning their careers. But it’s equally important that people on the cusp of retirement continue to look for ways to protect and grow their wealth. As retirement draws near, professionals can consider these strategies to ensure they have the financial freedom to make their golden years shine even brighter.
• Plan to grow your wealth in retirement. It’s widely assumed that retirees need less income after calling it a
career because the need to save for retirement is no longer present. However, some expenses, including health care, may rise in retirement, which underscores the need to continue growing your wealth. Cost-of-living also will increase over the course of your retirement years, which highlights the need to keep growing wealth in retirement. It can be tricky to protect your existing retirement savings as you approach the end of your career while also growing that wealth, so it is best to work with a financial planner to navigate that situation.
• Maintain a mix with your investments. A model from the Schwab Center for Financial Research indicated that a hypothetical retiree with a $2 million portfolio in year one of retirement will have slightly less than $1 million left 30 years later if her portfolio maintains a mix of 60 percent stocks and 40 per-
cent bonds and cash. The model found that a second hypothetical investor with the same size portfolio in year one of retirement will run out of funds prior to year 29 if his portfolio is 20 percent stocks and 80 percent bonds and cash. Though conventional wisdom suggests limiting risk as retirement nears and eliminating it entirely upon retiring, modern retirees are living longer and may therefore need to maintain a mix of investments to ensure they don’t outlive their money.
• Make the maximum allowable contributions. Many aging professionals may not have saved as much for retirement as they might have hoped to upon starting their careers decades ago. In fact, a 2024 survey from Prudential Financial found that many 55-yearolds have fallen far short of establishing the level of financial security they will need in retirement. The Prudential
survey found that 55-year-olds had a median retirement savings of less than $50,000, a number that falls considerably short of the recommended goal of having eight times one’s annual income saved by this age. If that situation sounds familiar for professionals nearing retirement age, then now is the time to begin catching up. Make the maximum allowable contributions to a 401(k) plan ($23,000 in 2024) and/or an IRA ($7,000). In addition, the Internal Revenue Service notes that IRA catchup contributions remained $1,000 for individuals age 50 and over in 2024. Retirement can provide a sense of freedom professionals have worked hard to achieve over the course of their careers. Some simple strategies can help professionals on the cusp of retirement achieve the financial freedom they’ll need to enjoy their golden years to the fullest extent.
Unlocking the Benefits of Credit Union Mortgages
In the realm of home financing, credit unions stand out as unique alternatives to traditional banks. Offering a customer-centric approach, credit unions have gained popularity for their member-focused services, including mortgages. Let’s dive into the advantages of credit union mortgages and why an HPC Credit Union mortgage might be the right choice for prospective homebuyers.
Member-Centric Philosophy:
HPC Credit Union operates on a not-for-profit basis, prioritizing our members’ interests over profits. This philosophy extends to our mortgage services, translating into potential cost savings for homebuyers. Lower fees and competitive interest rates are common features of our mortgages, providing financial benefits to members.
Personalized Service:
One of the hallmarks of HPC is our commitment to personalized service. Unlike large banks, we have smaller, more community-oriented operations. This allows for a more intimate and tailored mortgage experience. Members can expect individualized attention, with our mortgage officers working closely with you to understand your unique financial situations and needs.
Competitive Interest Rates:
HPC Credit Union mortgages often come with competitive interest rates. While rates can vary, we strive to provide our members with costeffective borrowing options, contributing to overall financial well-being.
Conclusion:
HPC Credit Union mortgages offer a refreshing alternative for individuals seeking a home loan. With a member-focused philosophy, personalized service, flexible terms, community connection, and competitive interest rates, a credit union could be the right choice for you. As prospective homebuyers explore financing options, considering credit unions could lead to a more personalized and financially advantageous homeownership journey.
HPC Credit Union, where we are invested in you!
www. hpccu.com (989) 354-4698
Common giving scams and how to spot them
December is a season of giving, and that charitable spirit is evidenced by the uptick in donations over the final month of the year. Perhaps inspired by Giving Tuesday, which is celebrated annually on the first Tuesday after Thanksgiving, donors tend to be especially generous in December. According to Donorbox, which provides an online fundraising platform to facilitate charitable donations, 31 percent of yearly charitable giving happens in December.
Nonprofit organizations undoubtedly recognize the spirit of generosity that surfaces each December, but criminals are likely cognizant of individuals’ desire to give back during the holiday season as well. Indeed, a 2023 press release from the United States Attorney’s Office in the Western District of North Carolina cited fake charities as one of the most common scams encountered by consumers during the holiday season. With that in mind, well-meaning prospective donors can learn to recognize common giving scams to ensure they are not victimized by crimi-
nals looking to prey on their generosity this holiday season.
• Fraudulent charities: Criminals targeting people who want to donate during the holiday season may set up fraudulent charities in an effort to trick people into giving them money. The New Jersey Division of Consumer Affairs notes that fraudulent charities may feature impressive names or a name similar to one used by a reputable, well-known charity.
• Phishing emails: Phishing emails have been around for decades, and for good reason. Such scams are easy to implement and highly successful. The Federal Trade Commission reported receiving 358,000 reports of scammers contacting individuals via email in 2023, and the real number is likely much higher, as few consumers take the time to report such emails to the FTC. Phishing emails typically prompt recipients to click on a link embedded in an email. These emails may seem as though they’re coming from an individual’s bank or credit card company, while others may indicate recipients can win a prize if they
Just 5% Can Change Everything for the Better
Dee Brown Perry was a quiet, yet generous member of our northeast Michigan community. She cared about education, and wanted to see students from Alcona County have the opportunity to attend college. Upon her passing in 2005, she left a planned gift through the Community Foundation for Northeast Michigan to do just that. Since her gift was received, it has provided more than $1.2 million in scholarships to help Alcona High School students -an amount that is closing in on the original donation. At this rate, in another 20 years, her fund will have awarded the original gift amount four times over. That is the power of endowment, and the power of committing to keep some of your assets local.
Northeast Michigan is in the process of losing billions of dollars. Billions. It has already been happening for over a decade and by the year 2060, nearly $17 billion will be given from one generation to the next in what is commonly referred to as the “transfer of wealth”. Most of that wealth will leave our communities, but if we as a community could work together to preserve just 5% for the betterment of the place we call “home”, it could mean a world of difference for northeast Michigan’s future.
If you think you are not part of the transfer of wealth, think again. Regardless of the size of your bank account, if you own a home (even one you still owe money on); own a car – fancy or not; or have an IRA, 401K or life insurance policy, then you have an estate. Have a collection of rare Beanie Babies, Hot Wheels or vintage Atari games? Then you have
an estate. All these things have monetary value and there should be a plan for what happens to these possessions.
This is where that magic 5% comes in. If we all committed just 5% of assets to stay locally in permanent charitable funds, by 2050 (when there’s still a decade left of the transfer of wealth), it would preserve $138 billion, leading to an additional $42 million in annual grants for our community. Even if you choose not to have your 5% be a permanent gift, you can still direct it to a local charity and affect the good of your community. Not to mention, a charitable planned gift could actually help you leave more to your heirs than you would without that donation.
So, what can you do to preserve 5% of your assets for good? Talk to a favorite nonprofit’s staff and see how a planned gift could best be used for them; create or tweak your current will; re-designate an insurance policy or retirement account to a charity; consider your own legacy and what that might look like; contact a financial planner or local attorney to get some advice; or contact your local community foundation whose staff can help with planned giving.
If just 5% can ensure a bright future for northeast Michigan, we should all take every opportunity to make it a reality.
open the email and click on a link within it. The New Jersey Division of Consumer Affairs warns consumers against sharing their credit card information in an email, even if the sender claims to be from a reputable charity.
• Pressure tactics: Seeking to capitalize on the spirit of giving that surfaces each December, some scammers will pressure prospective donors and potential victims into making donations over the phone or via links embedded in an email. Reputable charities do not pressure donors into giving over the phone or via email, so solicitations for immediate donations are a telltale sign of a charity scam. If prompted to make donations with cash or via gift cards or wire transfers, hang up the phone, as the FTC notes such payment methods are how scammers request donations.
made. This is an attempt to trick generous individuals into thinking they have a past relationship with a charity they believe is reputable, which might make them less inclined to vet the person or organization thanking them. Scammers are banking on establishing that false sense of security and trust, particularly during a notably busy time of year when donors may feel as though they don’t have the time to research organizations they want to support.
• Thank you messages: Another common giving scam is to thank potential victims for past donations they never
Scammers prey on individuals’ generosity each holiday season. More information about giving scams and how to avoid them is available at consumer.ftc.gov.
(StatePoint) It’s common to wonder how a new presidential administration will impact your wallet. As policies and regulations change, many people are left ques-
Navigating Your Finances During a Presidential Transition
presidential transition:
Take market coverage with a grain of salt: Media headlines might feel overwhelming, but it’s wise to avoid making big investment decisions based solely on the 24-hour news cycle. Unlike what you may hear, U.S. market growth and resilience have historically remained steady regardless of the political climate. For investment planning and advice, always rely on trusted resources, such as the insights of your financial advisor.
administration. Whether it is your capital gains taxes or your small business taxes, new regulations can impact what you pay. Your financial advisor can help ensure you continue to maximize every dollar you earn.
tioning what it means for their money.
According to CERTIFIED FINANCIAL PLANNER® professionals, here’s how to safely navigate your finances during a
Focus on fundamentals: Market volatility around election cycles is historically short-lived, so now is not the time to try to game the system, fully revamp your portfolio or reverse course on your longterm investment strategy. As always, you should stay focused on sound investment principles, like diversification and compound interest.
Examine your tax strategy: Consider whether your tax strategy will need tweaking in light of laws ushered in by the new
Take a look at your savings: Policies coming out of Washington could affect healthcare costs, energy prices, Social Security income and other factors that impact your overall financial picture. Work with a CFP® professional to create a holistic financial plan that is both tailored to your needs and adaptable to change.
To find a CFP® professional that will work in your best interests throughout this presidential administration and beyond, visit LetsMakeAPlan.org.
Navigating your finances during a presidential transition can feel tricky but with a big-picture mentality and the partnership of a qualified financial advisor, you can meet your financial goals.
Your Financial Dreams Matter!
loans, generally have lower interest rates and longer terms than other loan options. Wolverine State Credit Union offers a variety of HELOC options. The funds from a Home Equity loan can be used for college tuition,
call
Credit cards can enhance your shopping experience and save you money. Local credit union credit cards typically have lower rates than large banks. Card holders at Wolverine State Credit Union earn Scorecard Reward points for every dollar they spend. Scorecard Reward points can be redeemed for merchandise, travel and money off at the register. Card holders earn while they spend! The Wolverine State Credit Union mobile app allows individuals to control cards right from the palm of the hand. Card control functions include deactivating and activating the card, setting activity alerts, monitoring card activity and more. Local credit unions such as Wolverine State Credit Union also have personal service to help with any credit card questions or issues. It's hard to compare! Lower rates, reward programs, better service and more make getting a local Visa credit card from your local institution a great option.
Did you know?
Computers are vital for work or school. Computers can cost anywhere from a few hundred dollars for a basic model to upwards of $3,000 for a topof-the-line machine. Either way, purchasing a computer involves a considerable sum of money and buyers may wonder just how far that money will
go in terms of the computer’s longevity. According to the technology resource Nerds on Site®, the average life of a computer falls between three to eight years, and varies depending on the type of the computer and how it is being used. A desktop computer tends to last around five years, while laptops have shorter lifespans because of the batteries needed to keep them running, damage that can occur when transporting the devices and heat buildup from inefficient cooling. Despite the relatively short lifespan of modern computers, users who emphasize proper care and maintenance can likely add years to the life expectancies of their devices.
Time for New Year's Financial Resolutions
Now that the calendar has flipped, it's time for some New Year's resolutions. You could decide you're going to exercise more, lose weight, learn a new skill, reconnect with old friends - the possibilities are almost limitless. This year, why not add a few financial resolutions to your list?
Here are a few to consider:
• Reduce your debts. It may be easier said than done, but if you can cut down on your debt load, you'll increase your cash flow and have more money available to invest for your future. So, look for ways to lower your expenses and spending.
You might find it helpful to use one of the budgeting apps available online.
• Boost your retirement savings. Try to put in as much as you can afford to your IRA and your 401(k) or other employer sponsored retirement plan. If your salary goes up this year, you've got a good opportunity to increase your contributions to these retirement accounts. And once you turn 50, you can make pre-tax catch-up contributions for your 401(k) and tradi tional IRA.You might also want to review the investment mix within your 401(k) or similar plan to determine whether it's still providing the growth potential you need, given your risk tolerance and time horizon.
• Build an emergency fund. It's generally a good idea to maintain an emergency fund containing up to six months' worth of living expenses, with the money kept in a liquid, low-risk account. Without such a fund, you might be forced to dip into your long-term investments to pay for short term needs, such as an expensive auto or home repair.
• Keep funding your non-retirement goals. Your traditional IRA and 401(k) are good ways to save for retirement - but you likely have other goals, too,
and you'll need to save and invest for them. So, for example, if you want your children to go to college or receive some other type of post-secondary training, you might want to invest in a tax-advantaged 529 education savings plan. And if you have short-term goals, such as saving for a wedding or taking an overseas vacation, you might want to put some money away in a liquid account. For a short-term goal, you don't necessarily need to invest aggressively for growth - you just want the money to be there for you when you need it.
Review your estate plans. If you haven't already created your estate plans, you may want to do so in 2025. Of course, if you're relatively young, you might not think you need to have estate plans in place just yet, but life is unpredictable, and the future is not ours to see. If you have already drawn up estate plans, you may want to review them, especially if you've recently experienced changes in your life and family situation, such as marriage, remarriage or the addition of a new child. Because estate planning can be complex, you'll want to work with a qualified legal professional.
You may not be able to tackle all these resolutions in 2025. But by addressing as many of them as you can, you may find that, by the end of the year, you have made progress toward your goals and set yourself on a positive course for all the years to come.
This article was written by Edward Jones for use by your local Edward Jones Financial Advisor. Edward Jones, Member SIPC
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At Edward Jones, we deliver candid guidance and personalized investment strategies to help you plan for and realize the possibilities of your future — for you, your family and generations to follow.
At Edward Jones, we deliver candid guidance and personalized investment strategies to help you plan for and realize the possibilities of your future — for you, your family and generations to follow.
At Edward Jones, we deliver candid guidance and personalized investment strategies to help you plan for and realize the possibilities of your future — for you, your
Considerations for your second act
Many people see their careers as one of their defining characteristics. Children are often asked what they want to be when they grow up, and as adults they will likely be asked “What do you do for a living?” more times than they can remember. Work is undoubtedly a major component of life for most people from the time they leave school to the day when they retire. And a growing number of adults value work so much that they pivot to second careers.
A phenomenon known as “unretirement” occurs when people who have previously retired return to the workforce. A 2010 paper published in the Journal of Human Resources found nearly 50 percent of retirees followed a nontraditional retirement path that involved partial retirement or unretirement. According to a recent Retirement Saving & Spending Study from T. Rowe Price, around 20 percent of retirees are working either full- or part-time, while 7 percent of study respondents are looking for employment. Some people return to work for financial reasons while others seek the social and emotional benefits employment can bring. But individuals mulling a return to work or those currently working but trying to determine a second act should not feel beholden to previous career paths. A second trip around the employment block can involve an entirely different line of work. The following are some things to look for in a second act.
• Flexibility: Choose a career path that enables you to set your own schedule or possibly work part-time if that is your preference. This way you can still reap some of the benefits of retirement, including the flexibility to travel.
• Social interaction: Adults may lose daily opportunities to be social when they retire, which can compound feelings of isolation common among retirees. Consider a second career that lets you interact with a number of people and continue to build relationships and a good network.
• Personal passions: Reflect on what you might do for work if money were no object. This may help you narrow down new opportunities that are in line with your interests and passions. Find a job that utilizes your skills and experience and meshes with your interests. A former graphic artist, for example, may decide to teach design to young people.
• Nonprofit opportunities: Many retirees spent years in high-stress corporate environments where bottom lines may be more important than the bigger picture. Shifting to a career in the nonprofit sector can be a personally fulfilling job that utilizes skills learned in the corporate world.
• Consulting or contract work: If you’re a retiree who loved your job, you might want to have a second career as a consultant or contractor in the same field.
A number of retirees ultimately explore second careers. Finding a match may be easier than one could have imagined.
Tips to save when inflation is high
Consumers likely need no reminder that inflation has taken a notable toll on their finances in recent years. The cost of products and services has seemingly skyrocketed in recent years, leaving consumers with little recourse other than to scale back and find ways to save.
The online financial resource Investopedia notes that the inflation rate is the percentage change in the price of products and services from one year to the next. Data from the U.S. Bureau of Labor Statistics indicates the inflation rate reached 8 percent in 2022, or four times the 2 percent rate of inflation the Federal Reserve aims to maintain through its various monetary policies. Though the U.S. Inflation Calculator indicates the inflation rate cooled to 2.5 percent by the end of summer 2024, that may not comfort consumers who are still confronting high prices on various items, including housing.
Indeed, inflation continues to affect people from all walks of life. However, consumers can consider various strategies to save even when inflation is keeping costs up.
• Use rewards to your advantage. Consumers now have an array of ways to pay for products and services at their disposal. Conventional wisdom has long suggested credit cards should be used only in emergencies, but consumers who are confident they can pay off balances in full each month can consider using rewards-based credit cards to their advantage. Such cards return a certain percentage of each purchase (typ-
ically around 1 to 2 percent) to consumers, and they can be used to purchase everyday items like groceries and gas. Of course, this only benefits consumers if they pay off their balances in full each month. If not, the interest charges on credit cards will almost certainly exceed the 1 to 2 percent cash back consumers earn.
• Open a high-yield savings account. The days of earning significant interest on savings accounts may seem like a distant memory, but high-yield savings accounts are still available at many financial institutions. Consumers intent on building their savings in the face of a higher cost of living can look into high-yield savings account options at their own bank or another financial institution. High-yield savings accounts typically mandate account holders maintain a minimum balance that is considerably higher than the minimum balances on accounts with lower interest rates, so this might not be an option for everyone. But consumers who have already squirreled away a significant sum in their savings accounts may be able to grow their money, and thus overcome inflation rates, by transferring the balance to a high-yield savings account.
• Examine your spending. Perhaps the simplest way to save when inflation is high is to periodically assess your spending habits and make tweaks designed to save money. Such assessments can include everything from identifying ways to save at the grocery store to determining if entertainment sub-
scriptions are worth the investment. Many consumers have lamented the high cost of groceries since 2022, and it’s possible a membership to a wholesale retailer like Costco® can help reduce expenditures on various items, including paper products, that tend to be expensive at more traditional grocery stores.
Data indicates inflation has cooled considerably in 2024. But the cost of many items remains high, forcing consumers to rely on various ways to save money.
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* First-year rate shown above is effective as of 8/14/2024 and subject to change without notice. It includes a first-year bonus for the first contract year only.
** Under current federal income tax law. AAA Life and its agents do not provide legal, tax, or financial advice. You may want to consult your professional advisor prior to the purchase of any contract. Benefits may be taxable. Rates shown are annual effective yields. The first-year interest rate is guaranteed for first contract year only. It is separate from the minimum guarantee of 3.00% for the first 5 policy years and the minimum guarantee of 1.00% after 5 years. Interest rates are credited from the first day of receipt of funds. Annuities are not short-term products. During the surrender charge period, withdrawals exceeding 10% will be subject to a surrender charge that may be higher than fees associated with other types of financial products and may reduce principal. Withdrawals prior to 59½ may be subject to IRS penalties, separate from the annuity’s schedule of surrender charges. For complete details of the annuity and surrender charge schedule, please refer to the contract. Annuities offered by AAA Life Insurance Company, Livonia, MI. AAA Life (CA Certificate of Authority #07861) is licensed in all states except NY. Automobile Club of Southern California CA License #0003259. CSAA Life Insurance Agency of California, Inc. CA License #0D12130. Insurance products in Northern California offered through AAA Northern California Insurance Agency, License #0175868, in Nevada by AAA Nevada and in Utah by AAA Utah. Your local AAA club and/or its affiliates act as agents for AAA Life. Platinum Bonus Annuity Contract Form Series: ICC11-4111/DA-4111 (In OR: ICC11-4111). ALAN-23878-824-XX