beneficiary Archives - Sycamore Financial Group

How to Accumulate Your First Million Dollars

Hello from Sycamore,

The looming question out there for many is how do I save a million dollars? Starting off it may seem impossible, but we are here to tell you that with dedication, a strict budget, and time it is possible. It is also important to note that you do not have to make “a lot” of money for this to be possible. The earlier you start investing, the easier it will be.

Three main factors influence how quickly this aspiration might be attained and they are investment time horizon, contribution amount, and investment rate of return. We realize that some of you reading this have already reached one million dollars of investment assets, but for those who have not, let us look at a few different scenarios to see what it takes to accumulate $1,000,000 in a portfolio.

To oversimplify, we will assume a 10% rate of return on your investment compounded weekly.

As you can see, the earlier you start the less you will need to save weekly. Other important factors will come into play and this should be discussed with a financial professional. Please feel free to call us with any questions or concerns!

As always, we would love to hear from you! Please reach out with any comments or concerns you may have.

Thank you for your business and trust,

Brent Yard
Sycamore Financial Group

*** Taxes and portfolio turnover are not accounted for in the above example. All investment strategies and investments involve the risk of loss. Actual investment returns may vary. This article is distributed for general informational and educational purposes and is not intended to constitute legal, tax, accounting, or investment advice. The information, opinions, and views contained herein have not been tailored to the investment objectives of any one individual, are only current as of the date hereof, and may be subject to change. Any ideas or strategies discussed herein should not be undertaken by any individual without prior consultation with a financial professional to assess where the ideas or strategies that are discussed are suitable based on your own personal financial objectives, needs, and risk tolerance. ***

By Sycamore Financial Group|2022-07-21T12:10:49-04:00May 12th, 2021|2021 Newsletters|0 Comments

Taking Care of Your Family

Hello from Sycamore,

Each year as we have our annual meetings with you, we revisit the question(s) do you have a last will and testament (will), living will, healthcare power (HCP), and/or power of attorney (POA) documents. Having these documents in place not only gives you peace of mind knowing that your future wishes will be carried out, but they can also help a worried family during difficult times.

Last Will and Testament

Your last will and testament provide instruction on how your assets will be distributed upon your death. You may assume that upon dying, your possessions that are part of your estate (i.e. non-beneficiary assets, possessions, etc.) would transfer to your spouse or next of kin if not married, but this may not be the case. Without a will, your estate may be distributed based on the laws of your state of residency when you pass. For example, in Indiana, if married with children, your spouse inherits half of your estate and your children split the second half.

Living Will

A living will provide instruction on life-sustaining/medical care for you should you become incapacitated or unable to answer questions regarding your medical care. You may understand what treatments you would prefer (i.e. do not resuscitate, donate organs, etc.), and having a living will in place serves as a directive to help those you love to understand your wishes.

Health Care Power & Power of Attorney (HCP & POA)

It is important to have a trusted individual who can legally make decisions on your behalf if you are unable. An HCP gives an individual the ability to make health care decisions on your behalf. A springing POA becomes effective if you become incapacitated. These documents typically become effective after it has been deemed that you require some help in making health decisions.

As opposed to a springing power of attorney you may consider implementing a durable POA, this becomes effective once you sign the document and continues to be in effect if you are incapacitated.

As always, we would love to hear from you! Please reach out with any comments or concerns you may have.

Thank you for your business and trust,

Brent Yard
Sycamore Financial Group

***The information contained in this article does not, and is not intended to, constitute legal advice. Instead, all information and content in this article are for general informational purposes only. Neither Sycamore Financial Group, nor any of its employees have a legal background, are trained in the law, or practice law. Please consult an attorney before making any decisions based upon the material presented in this commentary. Only your attorney can provide assurances that the information contained herein – and your interpretation of it – is applicable or appropriate to your situation.***

By Sycamore Financial Group|2022-07-21T12:25:26-04:00October 7th, 2020|2020 Newsletters|0 Comments

Reevaluate Your Beneficiary Designations

Hello from Sycamore,

Are your beneficiary designations current?

Over time, events may arise that necessitate a change in beneficiary information for your qualified & taxable brokerage accounts. It’s important to periodically check the beneficiary status of your investment accounts. Accounts that are lacking beneficiary information, or contain information that is not up to date, could create an issue for your survivors. It’s important to note that a beneficiary change to an account will only affect that account. Should you have multiple accounts (including 401(k)’s, life insurance policies, annuities, etc. from other vendors), you will need to update each one individually. If you feel changes may be needed or are uncertain of your current beneficiary selection feel free to contact us.

If your accounts are held with Folio investments, you can check your beneficiary designations by logging in and selecting account settings then either the – ‘TOD beneficiary’ on taxable accounts or ‘beneficiary’ for IRA type accounts – section of each separate account.

Thanks for your business and trust,

Sycamore Financial Group

By Sycamore Financial Group|2022-07-21T12:18:38-04:00October 31st, 2019|2019 Newsletters|0 Comments

529 College Savings Plans – Winter 2007

Hello from Sycamore,

Using 529’s and the Indiana Plan for College Expenses

Two important changes were made in 2006 that affect section 529 college savings plans and their use by Indiana residents . First the Federal government extended the tax free status of earnings withdrawn when used to pay secondary education expenses. Second, the state of Indiana offers a tax credit to taxpayers funding college expenses through it’s “CollegeChoice” 529 plan. This credit is available to taxpayers starting in 2007. We now believe that everyone saving for college expenses should take a serious look at 529’s and in particular the “CollegeChoice” plan offered by Indiana.

Let’s take look at some of the basics of 529 plans:

Contributions to the account are made with “after tax” dollars where the earnings grow tax deferred. When these earnings are withdrawn to pay for qualified* college expenses, they are tax free. Expenses that are paid by scholarships, Pell grants, Veterans’ educational assistance or other similar programs cannot be used.
Anyone over the age of 18 can start a 529.
Anyone of any age can be named as beneficiary of the account. The beneficiary can be changed as long as the new beneficiary is a member of the original beneficiary’s family. The definition of “family” goes out as far as first cousin.
Almost any accredited secondary school qualifies.
You can transfer assets from one 529 to another, and transfer assets from Education/Coverdale IRA’s into a 529. No tax is paid during this transfer.
If the earnings are not used for qualified college expenses,they will be taxed as ordinary income and are subject to a 10% tax penalty when withdrawn from the account.
Any individual taxpayer can contribute as much as $60,000 in any one year for each beneficiary without triggering gift tax consequences, provided they do not make additional gifts to that same beneficiary within a five year period. This essentially allows you to make five years of gifts “up front”. This may be helpful with your estate planning.
The owner of the account maintains control over the account and has the option to change the beneficiary. This control does not negatively affect the estate planning or gifting.

Now for a quick look at Indiana’s “CollegeChoice” plan:

Each individual filing a single return, or married couple filing a joint return, will receive a 20% credit on their Indiana income taxes on the first $5,000 contributed to the plan each year. This equals a tax savings of $1,000. To claim this credit, simply claim it on your Indiana state tax return. Of course, keep proof of your contributions.
While the department of revenue does not define how long money has to remain invested to receive the credit, Senate bill 500 stipulates that the account remain open for at least 12 months. This requires maintaining a minimum account balance of $500 or having some activity such as a deposit or withdrawal during the proceeding calender year. Additionally, if withdrawals from the account are used for something other than qualified expenses, the account owner may be required to repay part or all of the credit previously received.
Accounts can be started with as little as $50. Minimum additional contributions to an account can be as low as $25.for each portfolio. Maximum contributions per beneficiary are$298,770. You must maintain a $500 minimum balance per account or make a purchase or liquidation within the previous calender year to keep the account open.
Fees: $10 per year for Indiana residents. This fee will be waived if the account balance exceeds $25,000 or if the owner has established periodic contributions.
You will be limited to the investment options available within the plan. We have reviewed these investment options and feel they are adequate.
You can invest directly into the program without paying any sales fees. If you elect to do this, you will be limited to the “Age-Based” investment option. To make other investment choices, you must use a broker.

All in all, we think that Indiana’s “CollegeChoice” plan is an excellent way to save for college expenses and recommend that you consider using this plan.

This overview has focused on what we feel are some of the more important aspects of 529’s and Indiana’s CollegeChoice plan, if you would like more information on Indiana’s CollegeChoice 529 go to www.collegechoiceplan.com, give us a call or set an appointment to stop by and see how this plan may benefit you. How much will you need to save? E-mail or call in your particular situation and we will send you an estimate. Kokomo 765-455-1554 Anderson 765-643-9333.

More information about 529’s can be found at http://www.irs.gov/publications/p970/ch08.html

Thanks for your business and trust,

Sycamore Financial Group

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Past performance does not assure future results. Investors cannot invest directly in the stock market indexes such as the S&P 500. Invest return and principal value of an investment will fluctuate. Investor value, when sold, may be worth more or less than their original cost. The material in this presentation is for illustrative purposes and does not reflect any particular investment.

By Sycamore Financial Group|2022-07-20T15:14:17-04:00January 4th, 2007|2007 Newsletters|0 Comments