Tag Archives: Taxes

Apr 23 2014

The Slacker’s Guide to Saving for Retirement

Whether retirement is coming soon or feels far away, it’s something you need to think about.

This article encourages students to make retirement planning a part of their budget and one of their financial goals.   It also points out the benefits of starting early—even if students can contribute only a small amount because of other obligations that include paying off student loans and other debt obligations, paying rent, buying groceries, and establishing an emergency fund.

A very good suggestion included in this article is to start by saving just $25 from each paycheck, and then increase the amount until someone feels they have reached a limit they are comfortable with.

Other suggestions include participating in a 401(k) account at work and using bonuses and salary increases to boost the amount contributed to your retirement account.

For more information, go to

http://finance.yahoo.com/news/slackers-guide-saving-retirement-113005671.html

Teaching Suggestions

You may want to use the information in this blog post and the original article to

  • Encourage students to develop a long-term financial plan that includes retirement goals.
  • Discuss time value of money examples that show how small dollar amounts invested on a regular basis can help achieve long-term financial goals.
  • Launch a discussion about the different types of retirement accounts.

Discussion Questions

1.  Many people never begin saving or investing because there is never anything left over at the end of the month.  How can you find the money needed to begin saving and investing?

2.  Why should you begin to save for retirement now instead of waiting until later in life?

Apr 16 2014

Do You Need the Retirement Estimator?

Are you saving enough for your retirement?  The Retirement Estimator gives you an estimate based on your Social Security earnings.  However, be aware that it is only an estimate since your earnings may increase or decrease in the future.  Moreover, your benefit amount may be affected by military service, railroad employment or pensions earned through work on which you did not pay Social Security tax.  Remember, your estimated benefits are based on current law and the law may change because by 2033, the payroll taxes collected will be enough to pay only 77 cents for each dollar of scheduled benefits.

For additional information about who can use Retirement Estimator and how you can estimate your retirement benefits go to http://www.socialsecuirity.gov/estimator/.

Discussion Questions

  1. How do you decide which calculator to choose?
  2. What are some other possible sources of income for retirees?
  3. How can the Internet assist you in your retirement?

Teaching Suggestions

You may want to use the information in this blog post and the original resource to discuss

  • What are the two primary reasons for increasing the normal retirement age?
  • What are some factors that may, or may not, affect your retirement benefits?
Apr 12 2014

Should You Worry About Estate Tax?

The estate tax is a tax on your right to transfer property at your death.  Most relatively simple estates do not require the filing of an estate tax return.  However, if your estate is $5,340,000 in 2014, your estate’s representative must file the return.

Who should you hire to represent you, prepare and fill your return?  The answer depends on how large and complex is your estate, how many beneficiaries you have and are they cooperative?

Discuss this matter with several estate tax professionals.  Ask about their experience and referrals.  Most estates hire the services of both attorneys and CPAs.

For additional information on estate planning and estate tax matters go to http://www.irs.gov/Businesses/Small-Businesses-Businesses-&-Self-Employed/Frequently-Asked-Questions.

Discussion Questions

  1. What is included in your estate?  What is excluded?
  2. What deductions are available to reduce the estate tax?
  3. What might be advantages of hiring the services of estate attorneys and CPAs?

Teaching Suggestions

You may want to use the information in this blog post and the original source to discuss

  • How can charitable gifts and bequests reduce estate and inheritance taxes.
  • Different types of taxes imposed on a deceased’s estate.
  • Arguments in support and against the estate tax.
Apr 6 2014

Average Tax Refund More than $3,000 So Far

A month into the 2014 tax filing season, the IRS said the average tax refund is up 3 percent to $3,034.

This article also reports that more taxpayers are completing their own returns as opposed to using the services provided by tax professionals and filing their returns earlier this year when compared to 2013.   Already, the IRS has received nearly 40 percent of expected total returns during the first month of the filing season.

Finally, recent surveys indicate most Americans plan to use their tax refund to pay down debt, for shopping, or for entertainment.

For additional information, go to    http://www.usatoday.com/story/money/personalfinance/2014/03/06/irs-tax-refunds-returns/6125597/

Discussion Questions

1.  Assume you just received a $3,000 tax refund.  How would you use the money?

2.  If you received a $3,000 refund this year, what effect would it have on your tax planning for next year?

Teaching Suggestions

You may want to use the information in this blog post and the original article to discuss

  • If students should use a tax refund to pay down debt, start an investment program, or spend the refund.
  • Time Value of Money examples to show how a refund that is saved or invested can increase in value.