3 things to consider for 529 Plans at year end

on December 21, 2015 1 comment

With only 10 days left in the year, there are a three things you should know about 529 plans that are time sensitive.

1. State tax deduction – For residents of Virginia and a number of states, there is a state tax deduction available for any contributions made to a 529 plan.  While the federal government does not provide a deduction, the growth in the account is tax free if it is used for qualified education expenses.  The contribution needs to be made by year end to be eligible for the deduction on your 2015 taxes.

2. Distribution by year end – If you have incurred qualified education expenses in the current year and paid the expenses out of pocket, you need to distribute the reimbursement for these expenses in the year that they were paid.  The end of the year is approaching quickly, so make sure you act soon if you need to take a distribution.

3. Rebalance your portfolio – Over time all investment portfolios move out of balance from their desired and original allocation.  One fundamental principle in portfolio construction and management is rebalancing the portfolio.  With 529 plans, you are only allowed to make changes to the portfolio twice per year.  At the end of the year, it is a good opportunity to make sure the portfolio is structured properly based on your goals and time frame for the investments.

During this time of year, we are all so busy, and it is easy to overlook things that need attention before the New Year.  Unfortunately, when you file your taxes and remember that you needed to address the items mentioned above, it will be too late. Take some time to focus on it now…you will be glad you did.


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Jeffrey Miller3 things to consider for 529 Plans at year end

Will the FED raise rates this time!!

on December 15, 2015 Comments Off on Will the FED raise rates this time!!

Today was the first day of the Federal Open Market Committee meeting.  There is tremendous anticipation regarding what the FOMC will do with interest rates.  The consensus is that the FED will increase their target rate by 0.25%.  The increase in interest rates has been anticipated for some time, but each time it has been delayed due to underlying fundamentals or current events that deterred the FOMC from moving forward.  What the delay has done is driven uncertainty in the markets which creates additional volatility.  Since the consensus is for an interest rate increase, we would anticipate a favorable response from the markets if they move forward with the expected interest rate increase.

By increasing the interest rates, the FED is making a statement in their confidence of the economy.  They believe that we are on a strong enough footing with their unemployment metrics and job growth. In many instances interest rate increases are used to slow down an economy due to inflationary pressures.  Today we do not see a tremendous amount of inflationary pressure, but the belief is that the FED is working to stay ahead of potential inflation so they can achieve their long term inflation target of about two percent and not overshoot it by waiting too long to act.

Others have been anticipating the interest rate increase because it provides the FED with a future mechanism to battle a recession.  Today with interest rates so low, if we did slip into another recession, there was some concern that the tools available for the FED would not be as expansive.  We would have to move into more asset purchase programs and down the path of not just easier monetary policy but also down a path of increased printing of currency.

If the FED moves forward with the decision to increase interest rates, then hopefully, some of the uncertainty that has caused angst in the markets will be removed.  It will be good to move past the looming question of when will they start to raise rates.  It is hard to believe that the target rate has been at the current 0% to 0.25% target range since December of 2008.

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Jeffrey MillerWill the FED raise rates this time!!

We are……Wealth Worth It!!!!

on December 8, 2015 2 comments

Well, here it goes…..our very first blog post.  Everyone said that the first one is the hardest….I can assure you they were right.  After a lot of thinking I decided it would be best to introduce myself and provide some background about me, our company and this blog.

I am Jeffrey Miller, an Owner and Investment Advisor Representative, for Courage Miller Partners.  Born and raised in Virginia Beach, I graduated from Norfolk Collegiate School and then attended Virginia Tech where I received my Bachelor of Science Degree in Biochemistry and my Master of Accountancy.  After working for IBM and Duke University Health System, I finally made the decision to pursue my passion of personal finance and my desire to help others make better financial decisions.

I frequently get the question…..what do you do with your Biochemistry degree?  I do the best thing I can imagine with that knowledge, I brew my own beer!

I now live in Chesapeake, VA with my amazing wife Melani and our three kids, Tyler, Mackenzie and Noah.

In late 2007, my partmiller_logoner Ralph Courage and I began officially working together.  We made a decision to launch an independent company and opened the doors to Courage Miller Partners in August 2008. Well, opening doors is certainly figurative.  We first started the business without finished office space, so our primary “office” was Ralph’s dining room.  Because our office space was taking longer than anticipated to be completed, we moved into temporary office space.  It was very raw and we ended up setting up plastic tables and chairs with cords running everywhere.  Fortunately, the temporary office space was only for 4 weeks.

In October of 2008, we moved into our current location in the World Trade Center in Norfolk, VA.  We recently renewed for 5 additional years.

After tremendous deliberation and research, we decided to walk away from the traditional broker/dealer arrangement in favor of a fully independent company that allows us to focus on what we enjoy most about what we do, help our clients.  As a result, Courage Miller Partners is a fee only Registered Investment Advisor only compensated by our clients for our advice and not for any transactions or investment products through commissions.

Much to the dismay and surprise of our former firm…..we have not failed to thrive.

We are very grateful to all our clients for giving us the opportunity to help them with their financial planning and investment needs.  We have developed tremendous friendships over the years with our clients.  We feel that they are part of our family.

As dedicated professionals, we feel that we are also responsible for educating you about finances.  We want to provide information that is useful for everyone to make better financial decisions, and that is what we hope to accomplish with our blog.  We are going to cover information from retirement plans and budgeting to markets and economic data.  Our goal is to cover topics about finance that will help you make better financial decisions.

Subscribe to our blog so that you stay up to date on trending financial topics, personal finance, and the uncertainty that thrives in financial markets.

We also look forward to hearing your comments and questions.  If there are topics you would like included or questions that you would like answered, please send us an email at blog@couragemiller.com or submit them through our question submission area.

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Jeffrey MillerWe are……Wealth Worth It!!!!