As a consumer, you’ve probably visited a franchise at least once in the last month. But have you ever thought about owning one? If you’re the entrepreneurial type and looking for a career change or another income stream, it might be worth considering. This kind of business venture allows you to be your own boss and offers more structure than a startup. There are pros and cons to owning a franchise, of course, and some questions to ask yourself before taking the plunge.

Which brand is right for me?
While all franchises follow a similar high-level model, no two businesses are alike. It’s critical to select one that seems truly invested in their franchisees’ success. Ranked lists of the best and worst franchises can shed light on what to look for (e.g., creative marketing) and what to avoid (e.g., high fees).

How can I acquire information?
Once you’ve identified a potential franchise, you’ll want to deepen your understanding of the day-to-day operations and learn all of the ins and outs. Attend a Discovery Day, a soft sales event where you can interact face-to-face with franchisors, ask questions and get a better sense of the brand. And they’ll want to get to know you, as well, before moving forward.

Who can assist me?
Of course, investing in a franchise is a big commitment and life event. When it comes to financial decisions of this scale, it’s wise to consult a business law attorney to review your franchise agreement before you sign. And you’ll want to look at the money side of things with an expert to help you frame your expectations and evaluate how this new business will impact other areas of your financial plan. Think a franchise might be for you? Get in touch.

The information provided in Eddleman’s Economic Insight is not intended to be used as investment advice; rather it is provided as general economic news and information for your awareness or for discussions with your investment professional. Please consult your investment professional or CPA for advice specific to your situation! Past performance is not indicative of future results.

No matter how much fun your summer is shaping up to be, it’s no time to put your finances on pause. Take a look at the past six months to gauge how you can adjust your strategic or tactical actions to ensure you’re making steady progress toward your financial goals.

Check In With Your Cash Flow
Is your spending under control, leaving you with a chunk of untouched income each and every month? If not, take a deep dive into your budget to see what your dollars are doing, and tighten that proverbial belt. And make sure your emergency fund is full so you’re not tempted to reach for short-term, high-interest debt when an unexpected need arises.

Look at Long-Term Goal Progress
If your cash flow and emergency fund are in good shape, point that unspent monthly chunk toward larger goals like retirement, kids’ college funds or other investment vehicles. Research has shown that time in the market may be more effective than trying to time the market. Now is an optimal opportunity to diligently and consistently fund investment accounts linked to your long-term goals.

Make Adjustments Based on Life Changes
Have there been any births, deaths, breakups, job promotions or other notable life changes since 2017 began? Milestone events can impact your financial plan and priorities in many ways.

You may need to tweak your insurance coverage, amend your estate planning documents or revisit the beneficiaries listed for your various accounts and policies. Let the appropriate professionals know; they will have the best guidance for each situation, but only if they’re aware of these changes in the first place.

The information provided in Eddleman’s Economic Insight is not intended to be used as investment advice; rather it is provided as general economic news and information for your awareness or for discussions with your investment professional. Please consult your investment professional or CPA for advice specific to your situation! Past performance is not indicative of future results.

Looking for a vacation that offers a spiritual break or the opportunity for introspection? Embarking on a pilgrimage where you walk historic paths and visit sacred sites may be the perfect vacation alternative. Here are a few historically significant options, whether you’re looking to go near or far.

International Destinations
Taking the time to explore other cultures on foot can put you in the frame of mind to savor nuanced details. Here are a few pilgrimage options:

  • Shikoku, the smallest of Japan’s southerly islands, is home to an ancient pilgrimage trail honoring Buddhist monk Kukai. The approximately 750-mile course, which can take as many as 60 days to complete, features 88 intricate temples.
  • The Camino de Santiago, also known as the “Way of St. James,” leads to the Cathedral of Santiago de Compostela in Galicia, Spain, where legend says the apostle is buried. The trail contains several branches, though the last 62 miles of the Camino Frances is the most popular.
  • Take in the English countryside on a roughly 53-mile walk (including detours) along the Great Stones Way, which includes a stop at the prehistoric Stonehenge in Wiltshire, England.

Domestic Pilgrimages
You don’t have to look outside the U.S. to find a pilgrimage path. There are several across the country, including the following:

  • Navigate part of the Mormon Pioneer National Historic Trail, which begins in Nauvoo, Illinois, and leads to Salt Lake City, Utah. More than 70,000 Mormons traveled this 1,300-mile, five-state path in the mid-1800s to escape religious persecution.
  • If you’d like to make a journey by car, venture through the Texas Hill Country and stop by the area’s historic painted churches. These Czech- and German-inspired beauties built in the mid- to late 1800s feature intricate artisanal handiwork and bold colors.

Craving the kind of getaway that helps you hit the reset button in a deep, meaningful way? Find a pilgrimage that resonates with you.

The information provided in Eddleman’s Economic Insight is not intended to be used as investment advice; rather it is provided as general economic news and information for your awareness or for discussions with your investment professional. Please consult your investment professional or CPA for advice specific to your situation! Past performance is not indicative of future results.

A long-term savings strategy like planning for retirement relies on small steps taken over an extended period of time. Make sure you’re on track by avoiding these common mistakes.

Underfunding Retirement Accounts
Are you among the 71 percent of Americans who aren’t putting enough away for retirement? The most effective determining factors of a well-funded retirement are how early you start and how much you save. Aim to contribute the maximum amount allowable into your retirement accounts each year. If that’s a stretch, commit to increasing contributions to retirement accounts any time your income climbs, whether it’s from annual raises or salary boosts when you change jobs.

Ignoring Tax Ramifications
If you’re early in your wealth-building journey or you anticipate a lower-than-usual income this year, it may be worthwhile to take advantage of your lower tax rate and make Roth contributions in your retirement accounts. Just make sure your employer-sponsored retirement plan has a Roth option. If your income disqualifies you from making Roth IRA contributions, consider Roth conversions.

Concentrating Your Investments Too Narrowly
Many Americans who held most of their funds in a single company or sector of stocks learned this harsh lesson during the dot-com bubble. When the bubble burst between 1999 and 2001, so did a portion of those portfolios. And the same concern goes for tying up the bulk of your wealth in your principal residence. Not only is it time-consuming and costly to convert a home to cash, but you’ll also have the added stress of finding a new place to live. Diversification is key to avoiding this mistake.

Whether retirement is a few decades away or just around the corner, the goal is to make steady progress in the right direction as you prepare for life after work.

The information provided in Eddleman’s Economic Insight is not intended to be used as investment advice; rather it is provided as general economic news and information for your awareness or for discussions with your investment professional. Please consult your investment professional or CPA for advice specific to your situation! Past performance is not indicative of future results.

Vacations allow you to escape the routine of your everyday life. Making the most of your time away from home is up to you. If you’re interested in springing for once-in-a-lifetime hotel accommodations, here are a few unusual options.

Relax in Luxury
Looking to indulge beyond the traditional hotel and continental breakfast? A well-appointed retreat that makes you the focus can help you recharge your mind, body and spirit. One option: the art-centric Hotel Marques de Riscal in northern Spain, which was designed by renowned architect Frank Gehry and sits on an established vineyard of the same name.

Or you can add a little adventure to your luxury getaway. At Oberoi Vanyavilas in Ranthambore, India, guests can sip champagne from the observation tower and spot royal Bengal tigers at a nearby watering hole, along with other indigenous wildlife.

Travel off the Beaten Path
If a real escape sounds like music to your ears, consider a remote destination where you can avoid real-world interruptions. How about a quiet island retreat off the east coast of Africa? The Manta Resort on Zanzibar’s Pemba Island offers privacy and romance and the option to stay in an underwater room surrounded by untouched coral reefs and their inhabitants.

If that’s not remote enough, consider White Desert’s Whichaway Camp in Antarctica. From November through January, travelers can experience the South Pole and all of its beauty in comfort and style.

Go With What Speaks to You
Finding a one-of-a-kind stay isn’t as hard as you may imagine; just give some thought to your personal interests. Car enthusiast? The 4.5-star, auto-themed V8 Hotel in Stuttgart, Germany, may speak to you. Nature lover? Sleep among the clouds in one of the treetop rooms in Sweden’s aptly named Treehotel. Your options for unconventional lodging across the globe are nearly limitless.

The information provided in Eddleman’s Economic Insight is not intended to be used as investment advice; rather it is provided as general economic news and information for your awareness or for discussions with your investment professional. Please consult your investment professional or CPA for advice specific to your situation! Past performance is not indicative of future results.

If you’re like most of our clients, you’ve thought long and hard about the financial aspects of your retirement. You’ve likely worked hard and saved diligently. But, retirement for each person is different. Perhaps you plan on a working retirement with a new job and less stress, focused on what you love. Or, perhaps you plan to travel, play golf, or just rock on the porch. Or, maybe you want to downsize to a smaller house, spend time with the grand-kids, or take up sky diving. Who knows? Whatever the plan, don’t forget to consider the location you plan to call home.

Where you “officially” call home can make a difference in your retirement lifestyle. Even if you plan to travel or live out of your RV, the place you officially live can impact your taxes and other living cost factors. Obviously, most people realize that retiring to California or New York will be generally more expensive than retiring to Tennessee. So, what are some of the factors to consider when picking a retirement destination?

For most retirees, the two largest expenses in retirement will be medical care and taxes. Yes, a milder climate not only means a more enjoyable tennis match, but it can also mean lower utility bills. However, lower utilities are not likely to be as big of a financial factor as other considerations. Regarding medical expenses, BenefitsPRO recently completed an analysis on healthcare costs in the US. Now, keep in mind that the analysis merely compares Medicare premiums, but this can still be a fair comparison on what average medical costs by state may be because Medicare premiums consider medical costs as a major factor. Believe it or not, the cost to have a heart attack is different in different parts of the country. So, on average, Florida has the highest Medicare premiums running 35% more than Hawaii, which has the lowest. This makes sense from a supply and demand standpoint; there are many more retirees in Florida needing medical care, which likely means there are consistent strains on supply, which in turn drives up the cost. Tennessee did not make the top ten lowest or highest for Medicare premiums.

Taxes are the other major factor for most retirees. Kiplinger recently listed six factors to consider when picking a retirement destination and each of the six factors were different types of taxes. Most retirees consider income taxes and while income taxes can be a major factor for some retirees, Sales Tax, Property Tax, and Estate Tax can be even more important. This is because once you reach retirement, you may have already earned most of your income; now it is more a matter of spending it. If income taxes are really your biggest issue, you might actually consider life outside the US. Over half-a-dozen countries actually have no income tax, but keep in mind, you’ll have to give up your US citizenship and other expenses may far outweigh the income tax savings unless your income is significant. Also keep in mind, the IRS will make you pay tax on your IRA before you expatriate, so don’t look to leaving the US as a way to avoid your Required Minimum Distribution (RMD). One income tax you may want to watch out for is income tax on certain investments. For instance, Tennessee has no income tax on earned income; however, it does have income tax on interest income over a certain level. These hidden taxes can sneak up on you and make a difference. Another somewhat hidden income tax is Social Security income tax. Some states have been moving away from taxing SS, but as of this writing, thirteen states still do tax it.

If you are less affluent, then sales taxes and property taxes will likely be more significant factors. When considering property tax, keep in mind that most often this is a function of county government rather than state or federal government. If you own or plan to own significant amounts of real property, moving across the county line could mean a significant difference. Also consider if the county/state allows for a property tax “freeze” for owners who reside in the property. This can ensure that property taxes do not go up for you.

As for sales taxes, this is a function of states and local municipalities, but usually more dependent upon the state’s rate. Again, moving across a state or county line or even out of city limits can be factor. Also be aware that the sales tax rate may vary by item. For instance, some states do not charge sales tax on food or may charge a different rate on certain large purchases.

Finally, there are estate and inheritance taxes. The difference in these two is the way they are calculated. Estate taxes are charged to the estate, but inheritance taxes are charged to the inheritor, which may have differing rates depending upon whether the inheritor is a spouse, child, sibling, or unrelated. And, not only do the rates vary, the exemption amounts (how much you can pass on without having the tax) varies by state. Some states match the federal government’s exemption, but most don’t.

In all determining where to retire is an important consideration for which weather may be a big consideration. Just don’t forget to look at the financial implications of location too. And, if you need help evaluating those consideration, call us at 877-5WEALTH.

The information provided in Eddleman’s Economic Insight is not intended to be used as investment advice; rather it is provided as general economic news and information for your awareness or for discussions with your investment professional. Please consult your investment professional or CPA for advice specific to your situation! Past performance is not indicative of future results.

 

Piggy Bank

Depending upon your circumstances and everyone’s is different, the order that you prioritize for investing may vary. However, in general most people should prioritize investing for the short-term and then the long-term. Short-term investing, which I prefer to call savings, is most commonly for an emergency fund. An emergency fund is basically a small accumulation of money to pay insurance deductibles and co-pays plus other small, unbudgeted expenses like a hot water heater replacement or new tires. An emergency fund should also be available as a replacement income during a time of unemployment. Most experts recommend having three to six months of expenses in an emergency fund. For many this may be the same as three to six months of income, but the distinction should be drawn here between income and expenses. To help evaluate how much you might need, look at the job market for your career. What you need to ask yourself is, “How long would it take me to find a replacement position to earn my current income?” Only you can be the judge, but that’s why three to six months is used as a rough guide. Statistically, the higher your income and the more specialized your field, the harder it is to replace your income. Some may want to plan for unemployment lasting more than six months.

Short-term savings may also include putting back extra for large purchases such as a large appliance, automobile, or vacation home. Though you may use similar instruments to help the money grow, be sure to keep this money separate from your emergency money. If you have the discipline to separate it through budgeting, you can use the same accounts, but this is difficult for most people. I recommend keeping separate accounts for your different short-term saving purposes. Obviously, it is difficult to save for your next car if you’re still paying on the old one, so debt elimination may be a factor in getting your short-term savings in place. Most would suggest getting a small emergency fund first, followed by debt elimination other than your home, followed by the rest of your short-term savings accumulation.

The objective of your savings instrument should be to outpace inflation while maintaining relatively stable principle values and high liquidity. We usually recommend a combination of a checking account, money market, and certificate of deposit for our clients. Each of these allows for good principle stability, but with varying degrees of return and liquidity. Having the least necessary in the most liquid investments is often the most advisable, but again only you can be the judge of what you will need access to.

In conclusion, the distinction between saving and investing is important. If you are merely “loaning” money with savings and not investing money, your assets will not truly “grow” in spending power. In fact, if you don’t keep up with inflation, the value of your money can go down even if the amount grows! Inflation is a real risk that should be considered for longer-term investing, so investment vehicles used for savings and investing should differ greatly for most people and businesses.