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When Should I Seek Financial Advice?

By | Featured

Here are some life milestones and events that mark when you should make the call to a financial advisor.

  1. When there’s a new baby in the family.

Parents, grandparents, siblings—everyone is affected when the new baby comes along. Now is the time to plan for what this tiny family member will grow to need in the future—especially college funds. And now is also the time to make sure that you have the right insurance and protections in place to see the child through to adulthood should something unexpectedly happen to you.

  1. When you get married.

Two people joined together in holy matrimony are also going to need to bring their finances together, for better or worse. And if there are any children from a previous marriage involved, it’s doubly important to find and hire a financial advisor that you both like and respect.

A comprehensive financial plan—which includes your mutual goals, time horizon to retirement, and desires for wealth transfer to family members—is a very important way to get started on your life journey together.

  1. When you win the lottery, or inherit.

We all dream of receiving a big financial windfall someday, but when you actually land a large amount of money at one time, studies show that many people squander it away. In fact, nearly a third of lottery winners actually end up declaring bankruptcy, becoming worse off than before they won.

If you receive money, call a financial advisor first, because no matter what the amount, it is actually less than it seems. You need qualified financial advice to ensure you don’t lose 30-90% to the IRS by not understanding tax laws. Financial advisors work as a team with your tax professionals to help you navigate inheritance, winnings, and gift taxes, as well as qualified money (like an inherited IRA account) tax rules so that you can actually end up ahead of the game.

  1. When you start working.

Your first job is an exciting time in your life. Even if you’re trying to pay off student loan debt, don’t miss the chance to achieve your life goals by harnessing the power of compound interest. Putting away even a very small amount each month can snowball through the years. A financial advisor can help you lay a plan to get ahead and reach your goals over the long term.

  1. When you start a new business, or want to sell one.

Small businesses offer many different options for retirement plans for their owners depending on the company structure. Call a financial advisor to help you set up a financial and retirement plan for your business in order to have the best chance of achieving your goals. And don’t forget about an exit strategy. Whether you want to leave your business to a family member or sell it, planning for your own departure from the company is essential to your ultimate financial success.

  1. When you’re starting to get close to retirement.

You should start to save for retirement as early as possible, but as you get closer to your actual retirement day, having a written plan in place to guide you becomes critical. How will you transform that nest egg you’ve saved into monthly income after you’re no longer getting a paycheck—without running out of money? How much money will you need? How will you take money out? Which accounts should you withdraw from first? What kind of taxes will you have to pay? How does Social Security work? How will you live, what will you do? Should you pay off your house first?

There are so many issues and retirement risks to address that retirement planning is absolutely essential. Ideally, you should have a plan in place by age 50—55. If you don’t, call your advisor as soon as possible.

  1. When you’re creating estate planning documents or establishing a trust.

Estate attorneys can create the documents you need, but they may not know about all the ins and outs of investments and insurance that can reduce taxation while helping ensure your final wishes are carried out. Call your financial advisor to get that important piece of the estate and tax planning equation.

  1. If you lose your job midlife, or are getting divorced with a lot of assets.

An adverse life event can hit anyone. If you’ve lost a job or are getting divorced, your financial advisor can help determine your best options for putting an immediate action plan in place.

For instance, if you’ve lost your job, your financial advisor may be able help you position assets in order to be able retire early, or help you draw from certain accounts to get you through until you land your next job.

If you are getting divorced, be sure to get advice from a financial advisor as well as your divorce attorney. They can help you analyze the assets that will most benefit you based on your future goals in order to reach the best settlement split. They can help you see things you might not be able to see clearly, and that divorce attorneys may not know. Like what kind of burden versus advantage keeping the family home might be.

  1. In the final quarter of every year.

Once you do have a financial or retirement plan in place, you should absolutely review it every year. (Most likely you’ll just need to answer the call, since most advisors will reach out to conduct annual reviews with you.) The annual review will allow your advisor adjust the plan as well as make changes to account beneficiaries as your family changes through time.


There are three different advisory disciplines you should seek out—tax professionals, legal professionals (like estate attorneys), and financial advisors. We can help you with the financial advice part of the equation. We can help you get set up with a tax professional and estate attorney from our network of contacts, or work as a team with yours.

7 Hidden Retirement Risks

By | Featured
  1. Longevity

The average life expectancy has increased. Chances are that if you’ve reached 65 years old you will live into your mid-80s according to life expectancy calculations. Many are living even longer—one in four people will live into their 90s, while one in ten will live past 95. Make sure that your retirement plan takes longevity into account so that you don’t run out of money—no matter how long you live.

  1. Loss of Income

Make sure both you and your spouse are protected from the unexpected. Consider the financial impact of the loss of one spouse, running the numbers both ways. Remember that your surviving spouse will only get the highest of your two Social Security checks, not both checks.

NOTE: Be sure to talk with us about Social Security. Last year it was discovered that the Social Security Administration failed to tell widows and widowers how they could receive a higher benefit amount.

  1. Incapacity Risk

Longer life expectancy could lead to high costs of a stay in a long-term care facility. The average cost of a semi-private room in a nursing care facility was more than $7,441 per month in 2018, and it’s estimated that approximately 50% of people over 65 will need long-term care. We can help you devise a plan to pay for costs if you do need long-term care, but not overspend on policies that may be subject to drastic premium increases, sudden cancellations or never be needed at all. There are many strategies and new options to consider.

  1. Negative Return Risk

A 50% gain does not allow a portfolio to recover from a 50% loss. In fact, a 100% gain is required to restore a 50% loss! Talk to us about how we can help reduce this risk in retirement. The “buy and hold” strategy that works when you are young—where you wait for the markets to come back up after a downturn—does not apply in retirement as we saw in 2008, when many people’s retirements were wiped out.

  1. Bond Risk

When interest rates* rise, bond prices fall—and vice versa. Duration risk is the name economists give to the risk associated with the sensitivity of a bond’s price to a one percent change in interest rates; the higher a bond’s duration, the greater its sensitivity to interest rate changes.

  1. Inflation Risk

You should plan on prices for food, goods and services getting higher during retirement, reducing your buying power incrementally as you are living on a fixed income. We can help you address inflation* risk in your retirement plan.

*Inflation and interest rates are considered by economists to be inversely related. So when inflation—or the cost of goods and services—rises, interest rates go down. Interest rates in the United States are set by the Federal Reserve based on the rate of inflation, which they like to see at 2%.

  1. Healthcare Costs

Surprising to some, Medicare is not free—your premiums for coverage are usually deducted from your Social Security check. And standard Medicare doesn’t cover dental, hearing or vision, is subject to deductibles, and doesn’t cover long-term care. Fidelity’s latest estimate is $275,000 per couple for out-of-pocket healthcare costs in retirement.


Let’s Create or Review Your Custom Retirement Plan

When people think about retiring, their number one fear is running out of money. That’s why we focus on creating reliable retirement income when we are developing your custom retirement distribution plan.

Once you have a retirement plan in place, it’s not set in stone. Things change. You may add or lose family members, your retirement goals may change, the economic environment may create new considerations, and financial innovations may present new strategies. Once per year is a minimum in terms of making sure your retirement plan (and beneficiaries) are constantly up-to-date.

And remember, the tax laws just changed. It’s more important than ever to plan ahead.

Call us!

Managing Your Finances

By | Featured

We work with dozens of people to help them create retirement plans. But in order to get to a successful retirement, there are thousands of small decisions along the way. Like, should you drive through your local coffee place and grab a latte this morning? Go with the office gang for lunch at that little bistro across the street, which usually costs you around $15? Should you order pizza delivered for dinner tonight because you didn’t go to the grocery store yesterday? Grab that new shirt because it’s 50% off?
Sticking to a budget is the beginning of mastering your money. But why do so many of us find it difficult?
A recent article in Forbes magazine may hold some clues as well as ideas about how to take control of your discretionary expenses. The author, Thomas Dichter, advocates writing every expenditure down, to the penny, as well as calculating how well you met your budget on an annual basis. (He usually comes within 1% of his goal, and many times comes in under, which he attributes to his meticulous record-keeping.)
Mr. Dichter explains how he started the process:
I forced myself to write down what I had spent under each category. After a week my inner accountant had emerged and I kept at it. By month six I noticed something magical: the act of tracking expenses had a feedback effect on my spending. My expenses in the categories that all of us tend to ignore (take-out food and coffee, a candy bar at a vending machine, impulse buying a shirt, or a magazine at the check out line, etc.) were going down, not because I wanted to deny myself, but because I could see what was happening.
At the end of that first full year those few minutes a day of what became compulsive recording paid off. It took me about a half hour to add up each category and then total it all (a side benefit became obvious when I had to do my taxes). Then I compared that total to my take-home income for the year and saw I was ahead, for the first time in my life. I decided to do a budget for the next year, using the past year’s expenses as a guide. At the end of that year I saw I had come within 1% of my budget estimate. Passing that self-imposed test soon became an annual goal. Each year on December 31st, I see how close I’ve come to my budget estimate of twelve months earlier. Usually I come within that 1%, sometimes over but more often under.
The author goes on to say that he believes that easy access to credit, along with an economy based on consumption, contributes to the overspending problem in America. And the main excuse for resisting his simple method—“I don’t have time”—is just a cover story for other, deeper reasons. For example, he believes that some people don’t really want to know what they spend, because it might rock their feeling that “everything is okay.” Some operate on the subconscious wavelength that it’s better to risk their financial future rather than turn into some kind of accounting nerd or tightwad.
As financial advisors who work with people every single day, we are here to tell you that managing your finances is possible, and might even be easier than you think. Let’s talk.
“A New Year’s Resolution To Manage Your Finances: Why Is Sticking To It So Hard?” by Thomas Dichter, Contributor, (accessed January 14, 2019).


By | Uncategorized


Volunteering in Retirement Offers Tangible Benefits

Volunteerism among retirees is popular these days and the activity seems to help them live longer. Studies from the Corporation for National and Community Service show people who volunteer “report lower mortality rates, lower rates of depression, fewer physical limitations and lower levels of stress than those who don’t volunteer.” Data from the 2014 study shows 20 million older adults 55 and up average more than 3 billion hours of service in their communities annually. The value of this time is estimated at $75 billion.

Tax Deductible

Volunteering has some tax saving benefits, too. Though you can’t deduct anything for the time you spend volunteering, you can deduct the cost of gas and oil for your automobile while driving to the activity, or simply deduct 14 cents per mile. Other deductions can include uniforms and attending conventions.

Finding the Right Activity

Like a job, volunteering requires the right fit. It may seem logical to offer the experience and skills you developed while working but doing something completely different may be more rewarding. Make sure the activity offers the flexibility to fit your schedule and that it’s something you feel passionate about.

You’ve heard of foster parent programs, but did you know there are programs that pair children in need with foster grandparents? This is just one of the volunteer opportunities available through America’s Senior Corp program. Learn more at

There are plenty of resources to find the right activity. The federal government offers Another great place to look is AARP’s Create the Good program.

Your community needs your talents and your commitment. And with the positive benefits of volunteering, this is truly a win-win situation.




“Longevity Risk” in Retirement

By | Uncategorized

When you hear your financial advisor mention “risk of longevity,” what exactly are we talking about here at Northland Retirement Group? Longevity refers to “long life” or “length of life.” Simply put, longevity risk is the risk that someone will outlive their wealth and available income.

It’s a fact that people are living longer. Not only has the average life expectancy increased, but one out of every four 65-year-olds living today will live past the age of 90. One out of 10 will live past 95–the number of people living to age 100 increased more than 43% from 2000 to 2014!

From a financial point of view, living a long time can drastically affect many of your retirement costs, impacting and presenting a “risk” to many different items in your budget—right when you will be living on a fixed income.

Let’s examine some of the issues affected by longevity:

  1. Health Care


Health care expenses are a huge chunk of any retirement budget—even with Medicare. A healthy 65-year-old couple can expect to spend approximately $266,589 to cover health care expenses not covered by Medicare Part A during their retirement for Medicare Parts B, D and a supplemental insurance policy (sometimes called Part C). This assumes at least one of them worked and paid Medicare taxes and so their Medicare Part A premiums are covered.


And that total doesn’t even include dental, vision, co-pays, deductibles and out-of-pockets. When you add those in, a couple’s costs rise to $394,954 throughout retirement. Living longer not only increases yearly health care outlays, but your chances of developing a serious health issue increase as you get older.


  1. Incapacitation


Your odds of becoming incapacitated also increase with age, which could lead to the need for nursing care. In fact, 70% of people over 65 end will up needing some form of assistance. The average yearly cost of a semi-private room in a nursing facility is $80,300.


Yes, you can qualify for Medicaid to cover your nursing home stay—if you spend down all of your assets to poverty level. There are options to this scenario that you definitely want to consider.


  1. Inflation


Prices will continue to get higher through the years—in fact, inflation is part of the Federal Reserve’s monetary policy. Inflation undermines your purchasing power over time. While it’s true that if the Consumer Price Index (CPI) rises in a given year, retirees sometimes get a COLA (Cost-of-Living Adjustment) increase on their Social Security benefit check, you’d best not count on that. For the last few years, there has been no COLA, primarily because of low oil/gasoline prices. It goes without saying that the longer you live, the more you will spend on consumer goods and living expenses.


  1. Excess Withdrawal / Inadequate Income


If your portfolio isn’t structured properly to provide enough income for a long life, you really are at risk of running out of money. Unexpected family expenses or needing to withdraw money during a market downturn can affect your nest egg negatively for the long term (kind of like compound interest in reverse). The death of a spouse is also a risk to your income, as Social Security benefits will likely decrease and taxes will increase due to fewer household exemptions.

The point of this article is not to inspire fear, but to inspire early, realistic retirement planning. Don’t worry about the future–let’s make some solid plans!

How to live longer and better: Find your purpose, keep working

By | Uncategorized



Finding meaning / purpose can extend your life

A recent British study led by Andrew Steptoe, Director of the Institute of Epidemiology and Health care at University College London found that after taking other factors into account “people with the highest levels of ‘purpose in life’ were 30% less likely to die during the study period, living an average of two years longer than those with the lowest levels.” The study involved 9,000 people averaging 65 years old.1

James Maddux, Professor Emeritus of Psychology at George Mason University in Fairfax, Virginia, reviewed the study and his team agreed that the findings make sense. Maddux noted that “people who actively search for meaning in life may be generally better at setting goals and making plans, including health care decisions.” The study review said there is good news for people who lack a sense of purpose—“it can be increased”—for instance, other studies have found that meditation, group therapy, taking classes or volunteering can help.

Work longer, live longer

In another study in 2016 conducted by Oregon State University,2 research indicates that working past age 65 could lead to a longer life, while retiring early may be a risk factor for an earlier death. Chenkai Wu, lead author and currently a doctoral student in the College of Public Health and Human Sciences, did the original research as part of his master’s thesis.

The researchers found that healthy adults who retired one year past age 65 had an 11 percent lower risk of death from all causes, even when taking into account demographic, lifestyle and health issues. They also found that even adults who described themselves as unhealthy were likely to live longer if they kept working.

“It may not apply to everybody, but we think work brings people a lot of economic and social benefits that could impact the length of their lives,” said Wu. He became interested in the topic due to much debated mandatory retirement ages in China, which in 2015 were 50 for men and 60 for women and men in labor-intensive jobs, and 55 and 65 respectively for white-collar women and men.3

“Most research in this area has focused on the economic impacts of delaying retirement. I thought it might be good to look at the health impacts,” Wu said. “People in the U.S. have more flexibility about when they retire compared to other countries, so it made sense to look at data from the U.S.” He examined data collected from 1992 through 2010, focusing on 2,956 U.S. adults.2

Planning for a longer life

With the start of a new year, there is no better time to put a plan in place which accounts for the longer years you may live, and encompasses your deepest desires as well as your current and future financial resources. Be sure to contact your financial advisor at BCJ Financial Group to get 2017 off to a productive start.



1 Pfizer, Get Old, “A ‘Purpose in Life’ May Extend Yours,” by Robert Preidt, HealthDay, July 15, 2016. (accessed January 17, 2017).

2 OSU, Oregon State University, News and Research Communications “Working Longer May Lead to a Longer Life, New OSU Research Shows,” 04/27/2016. (accessed January 17, 2017).

3 USCBC, The US-China Business Council, “China’s Mandatory Retirement Age Changes: Impact for Foreign Companies,” by Owen Haacke, April 1, 2015. (accessed January 17, 2017).



5 Facts about College You Need to Know

By | Uncategorized

Whether you have children, grandchildren, nieces or nephews headed to college when they turn 18, it’s always best to put anticipated higher education expenses into your financial plan–the sooner/younger the better.

Call us to discuss. And read here to learn more:

  1. FAFSA dates have just changed

For students college-bound in the 2017-2018 school year, there is an important FAFSA date change: the application date was just changed from January 1, 2017 to October 1, 2016—three months earlier. Details here.

Even if you think your family makes too much money to qualify for aid, most experts say you should apply for FAFSA (Free Application for Federal Student Aid) anyway, because colleges, state scholarship agencies, and foundations use the FAFSA when deciding who gets their scholarships, as well as how much each student will receive.

Students already on campus should also apply every year. And remember that school deadlines may be different from FAFSA deadlines.

  1. In terms of job prospects, a college degree is more necessary than ever.

According to the Department of Education,“a postsecondary credential has never been more important” because:

  • The average bachelor’s degree recipient will earn about $1 million more in their lifetime than those without a postsecondary education.
  • By 2020, an estimated two-thirds of job openings will require postsecondary education or training.
  • College graduates with a bachelor’s degree typically earn 66% more than those with just a high school diploma and are less likely to face unemployment.

The Wall Street Journal says salaries are rising for new college graduates. “Americans who earned a bachelor’s degree in 2015 landed a job with an average starting salary of $50,651, 5% above the average starting salary for 2014 grads.” Unemployment for recent college grads from 22- to 27-years-old was cited at 4.6% in the article.

  1. The cost of a college degree is high…second only to a home mortgage.

It’s no secret that college costs have skyrocketed. “College has never been more expensive…over the last three decades, tuition at four-year colleges has more than doubled, even after adjusting for inflation,” according to the Department of Education.

For the 2015-16 school year, the College Board estimated the average tuition and fees to be $9,410 per year at four-year, in-state public institutions. Room and board was about $10,000 annually. When you total various scenarios, the average cost of a bachelor’s degree ranges from $52,000-$130,000, depending on whether your child attends in-state or out-of-state, public vs. private university, attends community college first, and whether or not they have housing and food provided.

Chart from


In fact, these days, paying for a college education is one of the biggest outlays any family will ever make, after their home mortgage.

Why so much? According to a Center for American Progress report, it was “the Great Recession and resultant state budget cuts that led to the public college tuition hikes which have unduly burdened low- and moderate-income families.”

  1. Student debt is the highest in history

Student debt is a $140 billion-a-year industry, with 42 million Americans bearing $1.3 trillion in student debt. The federal government holds 93% of these outstanding student loans, making the Department of Education, in essence, one of the world’s largest banks. The average class of 2016 graduate with a student loan will owe more than $37,172, the highest level of debt yet. Almost 71% of bachelor degree recipients will graduate with a student loan, compared with less than 50% two decades ago.

Wall Street Journal

  1. Try NOT to sacrifice retirement for college

A recent survey of parents by HSBC Group found that 98% of U.S. parents are considering a college education for their child—and 60% would be willing to go into debt to fund it. Although parents say this makes it difficult to keep up with other financial commitments, they still think it’s more important than long-term savings or credit card repayment. And 37% of U.S. parents say their children’s education is more important than their own retirement savings.

Commenting on the findings, HSBC’s Global Head of Wealth Management said:

“The financial sacrifices that parents are willing to make to fund their children’s education are proof of the unquestioning support they will give to help them achieve their ambitions. However, parents need to make sure that this financial investment is not made to the detriment of their own future wellbeing.

“By having a financial plan to meet their family’s overall needs and reviewing it regularly, parents will be better placed to support their children’s studies without compromising on their own long-term financial goals.”

A recent segment on CNBC agrees that sacrificing your retirement is not the best decision in the long run, and urges people to plan early: Watch here.

Let’s discuss ways you can plan ahead to fund both college tuition and your retirement. Call us today.


17 Ideas for 2017

By | lifestyle

If you find yourself making the same old, same old resolutions every year, we wanted to help change things up by offering you some new ideas you might want to add to your list of goals for 2017.

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By | Uncategorized

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