AUTUMN - A TIME TO REFLECT ON YOUR FINANCIAL POSITION

Neal A. Deutsch, CFP^®

Published in Rivertown Journal, September 2010

With the summer briefly behind us, we can all look forward to cooler temperatures, colorful foliage and less children running amuck in the mall! For me, autumn is a time to reflect on the past three quarters of the year, and how to optimize on the last quarter. While there are some things we have no control over (tax reporting dates, laws and regulations, the "honey-do list" etc.) there are some things we can do before the year ends to help our position and benefit others at the same time.

Clean out a closet. See how many jackets and coats you can give away to those who really can use them. The bonus here? You get to help others and, if you get a receipt, you can deduct the donation at the same time. Don't forget to get the receipt stamped- make your accountant smile this year. While you're at it, let the bug bite you- see how much you can clean out and reclaim your closets. It's really addictive, you know!

Check out your IRA contributions for year 2010. Have you put away all that you can? For 2010 you can contribute the lesser of $5000 or 100% of earned income. If you are over the age of 50 (c'mon, admit it) you can contribute an additional $1000 if you qualify. Contributions to your traditional IRA are tax deductible, so you get to save for your future and deduct the contribution from you gross income for your final tax calculation. Think of it as saving on top of savings- you get to build your nest egg for the future and save on taxes this year. How cool! Besides, you really don't want to live with your kids in your golden years, do you?

If you are a high net worth individual, or have an excess of savings, consider a gifting program. In the year 2010 you can gift $13000 each to as many individuals you choose to, thus removing the asset from your estate and avoiding a possible estate taxation and estate shrinkage upon your death. While the estate tax deduction has not been determined for 2011, consider it forward thinking and a possible estate tax shrinker. In addition, if you are in the situation of moving into a nursing facility years from now you will have removed it from your estate, escaping a forfeiture of assets to Medicaid. It's like having your cake and eating it too.

Have an old clunker in the driveway? Give it away- there's a plethora of organizations that could use it for transportation of its workers and helping to take care of the elderly. Again, don't forget to get that receipt.

Speaking of cars- when is the last time you had yours serviced? Studies show that regular oil changes, tire rotations and belt checks can prolong the life of your car by thousands of miles. Give it a good wash and wax before the cold weather sets in and it will be looking like new again.

Take a walk around the outside of your house. Fix any leaking gutters and leaders- the leading cause of leaks inside the house. It's a lot easier to do in 70 degree weather than 20 degree weather. Check the roof, siding and for air leaks that will let in the cold weather leading to higher fuel bills. You can get a can of spray insulation for pennies and the resulting heating oil or gas savings will be multiples of the cost of the can. Squirt straight and not at your partner- that's what whipped cream is for!

If you really have pent up energy and would like to see a vast improvement in your lawn next year, be sure to put down a fall fertilizer. Buy a big sack of seed and put it down in late fall- it will germinate in the spring as soon as the ground reaches 63 degrees and you will be amazed at the difference in your lawn. You may mix the seed with topsoil before putting it down, as the topsoil will make a bed for the newly sown seed. Trust me on this one- it works like a charm.

If you've got any other fall recommendations, send them in and I'll pass it along. After all, if we don't all look out for each other, who will?

If hearing from me once a month isn’t enough, come visit me in our new blog site at www.chestnutblog.com.  If you think I’ve got pearls of wisdom here…you ain’t read nothin’ yet! See you there!

Neal A. Deutsch is a Certified Financial Planner^™  & Registered Securities Principal, offering securities through First Allied Securities, Inc., member FINRA/SIPC.  Neal is President of Chestnut Investment Group in Suffern, NY, helping people with financial planning since 1984. Please feel free to call Neal at 845.369.0016 or email him with your questions at neald@chestnutinvestment.com. Visit his website at www.chestnutinvestment.com