Understanding Required Minimum Distributions


Happy April 1st!  Did you know that April Fools’ Day is also called All Fools’ Day?  Did you also know that it may have started in the 16th Century due to a calendar change?  That calendar change was a switch from the year starting in April to the year starting in January.  Another theory ties it to the “vernal equinox,” which is the first day of spring in the Northern Hemisphere, but the weather doesn’t always behave Spring like (I know my New York clients will believe this!).  

For those of us in the personal finance world, it is a date that carries different meaning to us!  It is the last day you can defer your Required Minimum Distribution the year after you turn 70½, no April fools there, we don’t want you to miss that date and pay the 50% penalty!

 Understanding Required Minimum Distributions

By Financial Planner Scott DuMond, CFP®

“I turned 70 this year, isn’t there something I am supposed to do with my retirement accounts?”

The topic for today’s lesson is IRS Minimum Distribution requirements at age 70 ½. The IRS has a nasty penalty for not taking the required Minimum Distribution withdrawal, 50% of what you should have taken… and that’s no April fool.

I tell my students and clients that understanding Minimum Distribution requirements are like cutting an onion. There is always another layer, and the deeper you go, the more you cry. I am never sure if I am joking or not, so let’s take this one layer at a time. Out of respect for you and your tear ducts, we will stick to the first few layers. Please do understand that there is always another layer and it is worth talking to your financial advisor or tax professional as you approach age 70.

Layer One

If you have turned 70 or are turning 70 this year, be sure to talk with your tax advisor or financial planner. They will tell you what you need to do and when. The simple answer is either this year or next you will be required to take a withdrawal from your 401ks or IRAs of approximately 4% of your total.

That’s it. Feel free to stop reading here and talk to your financial professional. If you want to keep reading I will keep explaining. However, feel free to come back to Layer One at any time.

Layer Two

Exactly when do I have to take this withdrawal?

A person is required to take their first minimum distribution withdrawal the April 1st of the year following the year they turn 70 ½. *

Example 1:

Fred turns 70 in May of 2019. He then turns 70 ½ six months later in November of 2019. He will have to take out a distribution before April 1 of 2020.

Example 2:

Wilma turns 70 in July of 2019. She then turns 70 ½ six months later in January of 2020. She will have to take the distribution before April 1 of 2021. (The April 1st of the year after the year she turns 70 ½.)

Layer Three

When should a person take their first minimum distribution withdrawal?

They should take it the year they turn 70 ½ and not wait until the following April.

Example 1:

Fred turned 70 ½ in November of 2019. He therefore should take his withdrawal in 2019. The IRS gives you until the following April in case you didn’t know and needed to be told by your tax advisor.

So Fred could actually take his first withdrawal anytime between January 1st 2019 and April 1st 2020. He should keep in mind that this becomes an every year thing. He may want to be sure to take the first withdrawal in 2019 so he doesn’t have two withdrawals in the same year. The first one by April of 2020 and the second one by December of 2020. That could hurt come tax time.

Example 2:

Wilma turned 70 ½ in January 2020. She therefore should take her withdrawal in 2020. Wilma could take her withdrawal anytime between January 1st 2020 and April 1st 2021 and still be in compliance.

Layer Four

Exactly how much do I have to withdraw to stay in compliance and make the IRS happy?

This is a simple math problem. Find out the balance of all of your 401ks, IRAs, and other retirement accounts as of the December 31st of the year before the year your turn 70 ½. Divide that number by 27.4 if you will be 70 at the end of the year that you turn 70 ½ or divide that number by 26.5 if you will turn 71 at the end of the year that you turn 70 ½.

In the examples above, Fred would use 27.4 as his divisor and Wilma would use 26.5 as her divisor. The math would show you the amount of money you need to withdraw to make the IRS happy. Remember that it is your money. The IRS just wants you to withdraw it so they can tax you on it.

Like the directions on your shampoo bottle, this is a lather, rinse, repeat requirement. Meaning each year after you turn 70 ½ you will have to do this again with slightly different numbers. Thank you for joining me for this endeavor. Enjoy your spring!

*Remember if you have any concerns about this topic, please go back to Layer One.

*Remember also that there are many exceptions to this requirement that need to be reviewed. We just scratched the surface today in a topic that could be discussed in a full book.

Small Business Budgets for Financial Planning

Can you believe this is the last Monday of March!  Wow - how quickly the first quarter of 2019 has flown by!

Before we dive into this weeks blog, we thought we would share some tips from your VPN vendor on search engine privacy:

DuckDuckGo is probably the best known alternative search engine. It doesn’t use cookies that can identify users and discards IP addresses from its server logs. DuckDuckGo also shows the same search results to everybody, which is refreshing when compared to Google’s aggressive profiling.

StartPage is another privacy-focused tool our tech team recommends. It sources its search results from Google, which is a good thing if you simply want Google without the tracking.

Mom and Pop Small Business Budget - Your Passion...Budgeted

By Financial Planner Kate Welker, CFPⓇ


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I feel like financial planners bring up that word all the time, but that is because understanding your cash flow is essential to creating a successful financial plan. What if your income is inconsistent? I really enjoy working with small business owners and this can be one of the most challenging financial issues they face.

The first essential piece to figure out will be your baseline personal budget. Start with the barebones essential budget. This should cover all of the bills you have to pay each month plus the basic necessities such as groceries and gas. Next figure out your goal budget amount. This will be a higher amount, it is that barebones budget with your “fun money” discretionary spending and savings goals built in.

Once you have those figures together you will move on to analyzing your business financials and work on your business budget. You have to determine what your business needs are before you can determine how well you can support yourself from the income each month. You are going to look at the past years financials to review a few key numbers:

  1. You created a baseline budget for yourself, now do the same for your business. This number will tell you how much you have to leave in your business account each month. This will additionally give you your minimum sales goal. Your baseline business budget added to your minimum personal budget is the minimum your business needs to bring in each month.

  2. Include your income needs as an expense in your business budget. This can be thought of as your paycheck.

  3. Look for trends. Notice if there are certain months that sales are typically low, or the opposite times that sales are higher than normal. Besides income take note of times that expenses might be higher than usual. If you are in an industry that is seasonal this step is even more important for you. This will help you be aware of what to plan for in upcoming months.

  4. As with any budget you are going to analyze your numbers, both personal and business, to see if there are any categories that need to be adjusted. If you are overspending in a category now is the time to be honest and think through ways to lower those expenses.

Now that you know the numbers, you need to work on making the numbers work. An effective way to do this is to get one month ahead and live off of those funds for that month. During the month you are letting the new funds coming in grow in the bank account. At the end of the month you will review the financials for that month, make sure the amount to cover the business budget is there, and determine what you are able to take as your income for the next month. Working in advance takes off the pressure that the money won’t come in when you need it to pay a bill and allows you to be more objective planning out the next month.

In months with a surplus you will put those extra funds in a savings account. In months where there is a deficit you will have the savings account ready to fill in the gaps and keep your budget balanced. You should periodically go back to the first step to review and adjust.

This is an overview on ways to make planning for the ups and downs a little bit simpler. That working budget will always be a work in progress, but if you commit to reviewing the numbers regularly and being intentional about setting any surplus funds aside you will find more stability in the month to month.

If the thought of reviewing your numbers and planning your cash flow is daunting or you’d like to discuss how a financial plan can help your small business, we are accepting new clients and would love to talk with you!  

Financial Planning Strategies: Tax Bracketology

Top O’the mornin’ to you all!  We hope you had a wonderful St. Patrick's day!  We hope you enjoy this weeks fun tax facts by Rooted Planning Group’s Financial Planner Matt Fizell.


by Matt Fizell

As the calendar flips to March many people find their focus shifting to two very different things, taxes and basketball.  It is March Madness for the NCAA Basketball teams lucky enough to find themselves fighting for a National Championship, and also March Madness for those frantically hoping to file their taxes before the April 15th deadline.  These two categories will also be hot topics for breakroom chatter at your place of work, so here are a few handy tips to sound smart in those conversations, or maybe even boost your chances of having the bragging rights of the best bracket!

Let’s start with the fun stuff first... taxes obviously!

1) A bigger refund does not mean less taxes paid!

  • It simply means you paid in more taxes than you owed to Uncle Sam.  That means you essentially provided them with extra money, and you didn’t even earn interest!

  • H&R Block estimates only 1 in 5 people accurately adjusted their W-4, which is what your employer uses to estimate the correct amount of tax withholding from your income. If you find yourself owing money this year, feel free to schedule a complimentary appointment (click here)  with a member of our team to help walk you through your paystub and W-4 to make sure everything is squared away before it is too late in 2019.

2) My raise put me in a higher tax bracket this year, so now I have to pay more taxes on my income...

  • This co-worker of yours is partially correct, but it is important to understand the difference between marginal tax and effective tax rates.

  • For this example, we will assume a single filer, with $85,000 of income.

When tax is applied to income, we need to take a bucket approach to thinking about how it is being taxed in each bracket.  When one bucket overflows, the income goes to the next bucket and is taxed at the appropriate rate.

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As you can see, your co-worker’s income is barely trickling into the 24% marginal tax rate, the rate at which his next dollar of income is taxed at.  His effective (or average tax paid per dollar) rate is only 17.28%

Now for the real reason you are here... you want to have a better bracket than all of your friends, coworkers, or die-hard basketball fans you associate with. For those of you who didn’t quite understand my “Bracketology” pun above... Bracketology is “the activity of predicting the participants in and outcomes of the games in a sports tournament, especially the NCAA college basketball tournament.” (Dictionary.com) and it is safe to say Bracketologists are about as accurate as your favorite local meteorologist, tarot card reader, or stock-picker, so proceed with caution!

1) In 2018, the unthinkable happened... The University of Maryland, Baltimore County (UMBC) upset the Virginia Cavaliers by a landslide score of 74-54 to become the first #16 seed to upset a #1 seed team in the NCAA Tournament’s history.  Before this, #16 seeds were 0-135 against #1 seeds. Maybe history will repeat itself this year? It is a bold pick, but losing a #1 seed in the first round could mean a lot of heartbreak if you chose them as the National Champion in your bracket.

2) If you are looking to separate yourself early in the bracket challenge, look at the #5 Seed vs. #12 Seed matchups.  The #12 seed teams perform quite well in first round games, better than any other double digit seed, with a win/loss record of 47-89 against #5 seeds.  Those #12 seeds who have completed the first upset have approximately a 33% chance of making it to the Sweet 16. So pick one #12/#5 upset, and stick with them... chances are others in your pool won’t do the same, and you can pick up some valuable points!

3)  No team in NCAA History has ever had an unbeaten season.  The most recent team to come close was the Kentucky Wildcats in 2015, when they were defeated in the Final Four by whom else... but my beloved Wisconsin Badgers. While the Badgers ultimately lost to Duke in the National Championship, the numbers “38-1” will always mean something special to me and my fellow Badgers out there. Needless to say, State Street here in Madison, WI was a little crowded that night.

If you want to have a friendly conversation about your bracket, your taxes, or your personal financial life check out some of our resources and go ahead and schedule some one-on-one time with us.  While we can’t promise our bracket tips will help, we can promise to answer any questions you may have about our services, our fees, and how we can help before you sign any paperwork, so that you can take control of your finances on your own terms.


Caffeine, Uncle Sam, and Fun Times

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March 2019 is Caffeine Awareness Month and with just a little over a month to go to get our personal taxes done, we thought it would be fun to give you some facts about caffeine and taxes.

According to a study at Villanova University, 90% of Americans consume caffeine in one form or another every single day. More than half of American adults consume more than 300 mg per day, making it by far America’s most popular drug.

Marketwatch shows America’s beverage of choice is coffee.

This FDA chart shows caffeine content by drink and coffee still shows to be one of the highest in caffeine.


A few other fun facts about America’s caffeinated beverage of choice (Coffee)

  • The drink dates back to 800 A.D.

  • Brazil grows the most coffee in the world

  • Only 2 U.S. states grow coffee - California and Hawaii

  • The most expensive coffee in the world costs around $778 a can

  • You can overdose on coffee

  • Starbucks opens an average of 2 stores per day

Below are a list of side effects that could be from too much coffee or a high tax bill:

  • Rapid Heart Rate

  • Anxiety

  • Insomnia

  • Depression

We could continue on, however, the point is when we don’t pay attention to the details then it can cause us trouble.  If we over consume caffeine it can cause a lot problems. We can also run into problems during tax time if we don’t pay attention to the details.

This year brought some tax changes and when we aren’t sure how this is going to affect us it can cause problems too.  Hopefully you have your taxes done and didn’t have a high tax bill.

In the spirit of fun times, here are some fun facts about personal tax returns from Wallet Hacks and Opp Loans:

  • There are almost 80,000 employees at the IRS

  • 21% of Paper Returns have Errors

  • Less than 1% of Electronic Returns have errors

  • In 2017, 87% of Tax Returns were filed electronically

  • Uncle Sam wants you to be healthy! If you quit smoking, you can write off any smoking cessation products or programs

  • Al Capone was a famous Chicago mobster. He was eventually brought down by agents from the Treasury Department (this was pre-IRS) who were able to prove that he was avoiding income tax.

  • In 1982, Madison Square Garden was granted a 10-year property tax abatement. However, a clerical error led to the abatement being permanent. This has cost New York City approximately $200 million in tax revenue.

  • The IRS sends out over 8 billion pages in forms and instructions every single year, that's nearly 300,000 trees

We could go on and on but this is supposed to be fun… so we will keep it short.  Remember do not overdose on caffeine and don’t forget, if you owe taxes to either the Federal or State, you need to file your taxes by Monday April 15, 2019.

If you have any questions, feel free to reach out to us at Rooted Planning Group or visit our tax resources page for more information about the changes in the tax law for this year.

It's Taxing Time!

Happy March! Last week was exciting as we celebrated America Saves Week!  We offered 4 classes last week, three of which are now on YouTube and on our website if you are interested.  The classes include:

The fourth one was a live class on teaching kids about money - that was SO MUCH FUN - I just love what kids say about money!

I also love March for so many reasons.  It’s a month of celebration in so many ways, it starts out with my birthday in the beginning of the month, then to continue the celebration, St. Patrick’s Day is in the middle, and then rounding out the month is the first day of Spring!  Who couldn’t be excited about a month like that? I know some of you are not feeling the excitement and feel like it is more of a taxing time (pun intended).

It’s Taxing Time!

By Financial Planner Amy Irvine, CFPⓇ, EA, MPASⓇ

“May your troubles be less and your blessings be more And nothing but happiness come through your door.” - Irish Proverb

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We know you really don’t like doing this, but we promise to make it as easy as possible. Besides, you might even find some last-minute moves you can make that will make you chortle with glee at pulling one over (legally) on the tax man. In order to make it a little fun, we thought we would share a few fun quirky tax facts provided by Carol Craige of Fiscal Fitness Clubs. Of course, we will also be giving you good practical advice on how to prepare and get the most from us or any other tax advisor.

Quirky Tax Facts: Did you know…?  

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  • Athletes must file taxes in every state where they have played.

  • Russia once had a beard tax. If you had a beard during the rule of Peter the Great, you had to pay up. Apparently, the ruler wanted his people to look more like the modern, smooth-faced Western Europeans.

  • Drug dealers still pay taxes. The IRS includes a section about how drug dealers can pay taxes, with specific provisions about how drug dealers can’t claim business expenses, which tax codes they should use, and details on penalties for claiming narcotics distribution as a job.

  • Lady Godiva’s famous nude horseback ride was actually a tax protest. Lady Godiva’s husband told her he would reduce taxes on the people of Coventry when she jumped on a horse and rode naked through the town.

Source: Napa Valley Register

For the past month we’ve been up to our elbows with tax related planning and preparation.  The common frustration around taxes that we hear around this “process” is the amount of organization required.  You’ve got information coming from all sorts of sources, some paper, some electric, some from what feels like the sky.  And just as you think you have them all, and you’ve delivered them to us, SURPRISE, one more trickles in! The organizers we used this year were meant to streamline the process a bit with a list of the items you’ve had in the past, but if you’re self preparing, here is a full blown list of the items we walk through “behind the scenes.”  Don’t leave anything on the table!

Financial Planning Strategies for Caregivers

As financial planners, this week is one of our favorites!  It’s America Saves Week! We are proud to be partnering with Cornell Cooperative Extension - Steuben County to offer THREE webinars this week!  The links for each of the events are listed below, the events are about one hour and free, but you do need to register:

Also, as we round out the 2nd month of 2019 already, we want remind you of two upcoming events we mentioned last week:

  • TD Ameritrade has notified us that on March 15, 2019, they will begin mailing annual Standing Letter of Authorization (SLOA) confirmation notices to our clients.  The confirmation will list all active SLOAs that we have on record for your accounts as of December 31, 2018. You might be wondering, “what is a SLOA?”  This is what allows us to transfer money between your accounts when you request it. If you notice a bank account you no longer want listed, notify me and I’ll ask to have it removed.

  • In other news, we were very excited to learn that Fund For Women of the Southern Tier, Inc. is currently offering two education grants!  The deadline is March 1st, so if you know a young lady (including those young at heart too) that is going off to college this fall, make sure to forward this message to them.  “These grants are to be used to remove any barrier to the pursuit of their educational endeavors. Examples may include paying for college textbooks, technical supplies, assistance with past due tuition bills, fees for professional licensing exams, etc. Award criteria includes a demonstrated financial need.”

    • Ten - $500 Grants

    • Four - $2,500 Grants

When I read Kim’s article this week, it really hit close to home.  Brent and I have seen first hand the development and effects of Dementia on a loved one.


By Financial Planner Kim Anderson, CPA


Rooted Planning Group chose love, giving, and caring as our theme for February which is more than appropriate given that Valentine’s Day falls on the 14th.  To round out the month, my topic is caregiving and it’s very close to my heart because I have several relatives who have taken on this vital role and I appreciate them more than words can say.

According the Women’s Institute for a Secure Retirement, (a) 2 out of 5 adults are caregivers, (b) 60% of caregivers are women; (c) 70% of caregivers make adjustments to work schedules to accommodate caregiving responsibilities, (d) on average caregiving women lose $324,044 in lost wages, social security benefits, and retirement plans over a lifetime, (d) women caregivers are 2 times more likely than non-caregivers to end up in poverty, (f) a caregiver’s estimated out-of-pocket costs = $5,531 annually, and (g) each year caregivers provide $470 billion worth of unpaid care.  Those are some staggering statistics and I see them playing out in my family as I write this.

My cousin Debbie (61) is caring for her husband (58) with brain cancer; my aunt Kathy (57) is caring for her husband (55) with Stage 4 liver failure; my cousin Joe (71) is caring for my uncle (93); my cousin Toni (66) cared for my aunt until her death in 2015 and since dementia / Alzheimer's can be found on both sides of my family, I expect caregiving needs to increase as the family ages.  As you can see, caregiving needs are not just for the elderly and caregiving providers are not just the young. We never know when we might need caregiving services or be asked (or expected) to provide them to a loved one.

My family caregivers say they wouldn’t have it any other way, and I believe they are sincere when they say it – but just because they wouldn’t have it any other way doesn’t make it easier.  When my uncle passed in 2011, my aunt was well into needing assistance with every aspect of her day-to-day activities due to her advanced dementia. It would be another four years before my aunt would pass.  Money was not plentiful, they heated their house with wood and electric, and had a long drive that needed (snow) plowing and a large yard that needed mowing. Life is hard enough caring for dementia patients, but my cousin had the added burden of splitting and hauling wood to the stove, weekly yard mowing for five months of the year, and still being the financial trustee for her son who suffers from cognitive disabilities due to a car accident when he was 18 years old.  My cousin Toni is an amazing women for “doing it all” with a smile on her face during that period of time – including caring for my aunt in her home until the day she died.

During the years Toni was unable work outside of the home because she was the primary caregiver, she did get some much needed respite when one of her brothers/sister would take on the duties – which wasn’t often enough.  In the end, there was not much of an estate left, and what was left was split pretty evenly between the four kids. What a thanks for providing $500,000+ worth of caregiving services while giving up five years of earning ability and contributions to Social Security and her own retirement account.  And while she didn’t do it for financial gain, a little more appreciation along the way and a thank you every now and then would have gone a long way.

So for all the past and present caregivers I have known and currently know, THANK YOU for everything you have done and currently do.  The world is a better place because of you.

For everyone who is likely to become a caregiver in the future or knows someone who will, please watch  our Caregiver presentation at Social-Security-and-Medicare and download the accompanying “Best of Caregiving Resources Guide”.  I believe you will find the information invaluable as you embark on the priceless journey of caregiving for your loved one.

For the Love of Libraries

We hope you all had an enjoyable Valentines Day!  As Financial Planner Kate Welker, CFPⓇ writes below, she not only loves her special someone’s, but also her library and all the resources it provides for!  But before you dig into her article, we have a few brief announcements.

  • TD Ameritrade has notified us that on March 15, 2019, they will begin mailing annual Standing Letter of Authorization (SLOA) confirmation notices to our clients/  The confirmation will list all active SLOAs that we have on record for your accounts as of December 31, 2018. You might be wondering, “what is a SLOA?”  This is what allows us to transfer money between your accounts when you request it. If you notice a bank account you no longer want listed, notify me and I’ll ask to have it removed.

  • In other news, we were very excited to learn that Fund For Women of the Southern Tier, Inc. is currently offering two education grants!  The deadline is March 1st, so if you know a young lady (including those young at heart too) that is going off to college this fall, make sure to forward this message to them.  “These grants are to be used to remove any barrier to the pursuit of their educational endeavors. Examples may include paying for college textbooks, technical supplies, assistance with past due tuition bills, fees for professional licensing exams, etc. Award criteria includes a demonstrated financial need.”

    • Ten - $500 Grants

    • Four - $2,500 Grants

For the Love of Libraries

by Financial Planner Kate Welker, CFPⓇ


“Libraries are community treasure chests, loaded with a wealth of information available to everyone equally, and the key to that treasure chest is the library card. I have found the most valuable thing in my wallet is my library card.” - First Lady Laura Bush

As financial planners we are always working to make the best use of our resources. Normally we are talking about our financial resources, to use those in the most meaningful way and saving where possible. We are often surrounded by places in our communities that offer opportunities to save a little more of our financial resources. In light of seeing that it was recently “love your library” day I wanted to look at how you can love your library to save money and find resources that you might not realize are available.

Whenever I have to describe myself one of the top adjectives I use is bookworm (or as someone recently dubbed me, a bookdragon). When most parents are struggling to encourage their children to read, mine were telling me to put the book down to focus on the more urgent things in life like my chores or where I was walking. As a parent I have passed this trait on and I find our household going through a lot of books. Since I am not willing to devote that much of my budget to purchasing books we have made the library a regular part of our routine and I have begun to realize the additional services to be found there.

Obviously thinking of a library you think of the books. Mystery, fantasy, true crime, romance, so many books across many genres. I read mainly for entertainment and will sometimes forget the wealth of resources in non-fiction books available at our library. In high school I would use the classical research section for papers, but now I appreciate the whole non-fiction section. Want to learn a new skill? Instead of paying to join a class try to find a manual at the library. Bored of cooking the same recipes? Make cooking at home fun and try a new cookbook, my library has a whole shelf available. Starting a business and need to learn more on your industry? Check the library.

One of my favorite new tools I have discovered is the ability to borrow ebooks. The apps Overdrive and Libby allow you to link to your library using your library card information. These are free apps and as long as your library is part of the system there are thousands of titles available. You can choose to read within that app or export to the kindle app which is available as a free app on ios, android, and amazon devices.

Beyond the books there are other items available to loan. Movies, audiobooks, music, board games, puzzles, e-readers and the list goes on. The movies may be more classics than blockbusters, but instead of spending the money on a rental, occasionally take advantage of the collection available at the library. Get to know your librarians and ask what resources beyond books may be available to you to borrow.

Within the library you might be surprised to find new technology to take advantage of. Most libraries have had computers available for those that don’t have access at home, but these offerings are expanding. I was recently speaking with an attorney handling legal issues for libraries as they are trying to find ways to reach more patrons in a digital age.  Items such as scanners, virtual reality sets, and 3D printers are being added at more libraries daily.

The best advice is to get to know your librarians. They are an incredible resource and will be able to keep you up to date with the latest resources your library has to offer. If there is a resource you need that they do not carry, they may be willing to order it for you. Many libraries also offer educational classes, one to watch for is Money Smart week coming up March 30th to April 6th, 2019. Several of the planners here at Rooted Planning Group will be setting up educational sessions in their local neighborhoods. Check out https://www.moneysmartweek.org/ to find an event near you.

Financial Planning Strategies: Money Dates

We are real romantic’s here at Irvine Wealth Planning Strategies / Rooted Planning Group!  We want you to have a Money Date for Valentines Day!

To hear from a couple that clearly talks about money in their marriage, listen to Episode 51 - A Conversation with Brian and Natalie Hanks

“If you have only one smile in you, give it to the people you love.” - Maya Angelou

Do you need a “Money Date” for Valentines Day?

By: Financial Planner Kerrie Beene


What more could anyone want for Valentine's Day besides a serious talk about finances? That sounds romantic.....

Right, but sometimes these talks can end up bringing you closer. And, being on the same page with your spouse is worth more than any Valentine gift you could buy.

Money is in a lot of conversations that we have with our significant other. Small interactions about money happen on a daily basis.  Sometimes, these harmless interactions can create a negative feeling. A lot of times, we may not even realize this is happening.

My husband makes me nervous on a daily basis because Bass Pro and Cabela's have it worked out where he gets at least one magazine or coupon from them daily. So, what does that lead to? ....... I need a gun, fishing poles, or even a boat...  And, that was just this week.

However, he probably feels the same way when my magazines roll in..... JCrew, Ballard Designs, and Pottery Barn are always waiting on me when I open the mailbox. We actually need another piece of furniture... We really do. Isn't furniture considered a need?

These small conversations that come up daily can stir our emotions about money. The truth is, if you would sit down and get past the argument, you probably both have the same priorities. However, when we ignore the hard conversations, then the easy drive-by conversations can cause problems. I actually want him to have a boat, and he agrees that we need another piece of furniture. The problem is how will it be paid for and what are we not spending that money on that we should be.

I think in the busyness of day to day life we ignore the important issues and want to escape with the fun purchases. However, we both want our kids to go to college, and that hard conversation about money and priorities can be very helpful. The goal is for money to work for you, not you working for the money.

So, how do you have that hard conversation with your significant other?

Set goals and priorities first, together. Once goals are set, it makes the money conversation work better because you have agreed what is most important.

  1. Be humble. If you are the one who handles the money, it is easy to see your spouse's mistakes.  But, if you look closely, you have some too! And, let the past be the past! Don't go into the conversation in attack mode.

  2. Don't expect perfection. Expect progress instead. Moving in the right direction is all that is necessary. Life happens and is hard sometimes. The point is to make sure you and your significant other are going in the same direction.

If a "Money Date" is what you need, schedule one with your spouse.  If you are ready to take your financial planning to the next level, feel free to reach out to any of us at Rooted Planning Group. We all love goal planning and helping people figure out how to use their money to meet those goals!

Happy Valentines Day


Parallels of Investing and Baking

It’s February, the month of Love!  Do you know the history of Valentine’s Day?  Beyond the “Hallmark” holiday it has become, there is some interesting history.  Have we peaked your interest, read more from the History Channel: History of Valentine's Day. Since it is the month of love, how about a little lovin’ from the oven...

How investing is like baking
by Scott DuMond, CFPⓇ


With Valentine’s Day approaching, consider making something you love for someone you love. How about chocolate chip cookies? My wife has made excellent pies since the day I met her. She makes a fantastic flakey crust, just like her mom’s. Her apple pies are legendary!  However, as good as her pies have been, she has always had difficulty making chocolate chip cookies. She admittedly said so herself. We have friends that make outstanding chocolate chip cookies, like none other. They even shared the recipe with us. However, every time my wife, Valerie, tried to repeat the mix they always came out flatter and harder than expected. They were still chocolate chip cookies, don’t get me wrong.  My boys and I would still eat and enjoy them, but something was still amiss.

One day while thoroughly enjoying the cookies baked by our friend, we lamented Valerie’s inability to match the quality.  We asked what her secret was. We were overjoyed when our friend invited us over for a “Cookie 101” demonstration. Valerie received first hand instruction on how to create those much coveted cookies.  She was in her glory for baking is one of her passions.

Here is what we found out…

  • Make the whole recipe, it makes a big difference.

  • DO NOT use softened room temperature or melted butter.  To quote our friend, this will make the cookies “flat and bleh”!  Instead take the butter out from the refrigerator first before gathering up all the other ingredients and equipment.  

  • This is the clincher…when creaming the butter and sugars together, use a mixer and be sure to mix for a good four minutes! It must be CREAMY.  Repeat the four minute creaming process after adding the eggs and vanilla to the butter sugar mix.

  • When mixing the dry ingredients into the wet ingredients mix only long enough to blend the two together. *Over mixing will produce tough cookies.

  • The last hint is to UNDERBAKE the cookies. Pull them when they are just getting golden brown around the edges and on top.

My wife has been elated to add this fantastic recipe to her baking repertoire.

Now let’s apply these concepts to investing.

It is no secret that the investors, on average, receive a lower return than the assets they are investing in. For example see the graph below based on a study by Dalbar ending in 2016.  Over a ten year period, the US stock market earned an annualized return of 6.95%. Over the same time frame the average stock investor return was 3.64%.

Scott's Graph.png

This relationship has been consistent from study to study and time period to time period. Investors tend to get a much lower return then the investments they are investing in. How come? It comes down to one simple truth.
While many people are able to come up with a reasonable diversified portfolio by themselves or with help they will make a change when investments are doing poorly. When there is bad news and the market is losing money, yes December was very painful for me too, people will find it necessary to sell their mutual funds and wait for the market to rebound. This is an example of buy high, sell low and then buy high again. *By over stirring and over changing their portfolio, not only are they missing out on returns, they are hurting themselves substantially.

If we were baking and we over stir, we end up with flat hard cookies. If we are investing and we move money around too much, we end up with lower returns.

So what should we do?

  1. Choose an appropriate investment mix that fits your risk tolerance.

  2. Measure your risk tolerance each year to make sure that it hasn’t changed. We hate having a market drop remind us we are taking more risk than we are comfortable with.

  3. Rebalance when there is a change in your asset allocation due to excessive returns or drops.

  4. Do not react quickly and take your money out of the market when there is bad news and the market drops. Instead, look at this as a buying opportunity.

Interested in the famous recipe Valerie now uses?

1 lb butter

1 ½ cups sugar

2 cups brown sugar (not firmly packed)

2 tsp vanilla

3 eggs

6 cups flour

1 ½ tsp baking soda

1 ½ tsp salt

4 cups chocolate chips


  • Preheat oven to 350 degrees

  • Using a mixer, cream together butter and sugars (4 minutes)

  • While creaming the butter and sugars, mix all dry ingredients in a separate bowl

  • Add vanilla and eggs to the butter and sugar mixture, beat another 3 to 4 minutes

  • Add the dry ingredients into the wet mixture, along with the chips. Mix only until blended through and dough forms.

  • Bake one tray at a time for 8-10 minutes (until just barely golden brown)

Financial Planning Strategies: Organize for Success


Organizing brings consistency... consistency brings success.  By Matt Fizell

“Organizing is what you do before you do something, so that when you do it, it is not all mixed up”. –A.A. Milne 

With the month of January quickly coming to a close and a few really awesome blog posts focusing on organization being released over the course of the month, I wanted to take this opportunity to tie it all together with “why” we should be organized.

If you the reader are similar to most Americans, 75% of you who created a “New Years Resolution” have likely already thrown it to the curb, and are not on track to reach the big, sweeping declaration which would make 2019 “The year I finally do …..” and hit that goal you wanted to achieve as 2018 came to an end.  According to a Forbes article, only 8% of Americans who set a resolution will actually hit their goal. Like most Americans, I too am guilty of failing a previous resolution, and last year I realized for me… organization was the issue.

The main reason why MOST have already failed is a combination of vague goals, which do not have a clear measurement of success for the goal setter, and simple lack of organization.   “I want to lose weight”, “I want to make more money”, “I want to save more” are all really great examples of the common goals we see and hear about in the news at the end of the year.  Statements are not goals, and if we do not have clear goals… they will be nearly impossible to complete due to the simple fact we do not know how to prepare for the journey ahead.

So as I usually do in my blog posts... IT’S STORY TIME!  For my “resolution” last year, I had the goal of getting back down to my original college weight, a goal that I had continually put off year after year. My first job out of college had a breakroom constantly stocked with sugary snacks from co-workers who liked to bake, client lunch meetings were paid for, and corporate trainings usually entailed catered lunch/dinner, which led to me putting on nearly 15 pounds of extra weight in two years. I was serious about losing the weight this time around, and understood if I wanted to lose 5 pounds a month, I could only eat 1850 calories per day. If you have a similar goal in weight loss, I highly recommend the “MyPlate” app available on all smartphones, it is free to use!

After finding “my number” based on when I wanted to lose the weight by, I then had to organize my pantry and fridge, which meant getting rid of a lot of unhealthy snacks... this is no different than ridding your budget of unnecessary spending with your discretionary income, overspending on the things that WON’T help you hit your goals.  From there, I went to Amazon, bought Tupperware and a food scale so I could organize my meals for the week, and pre-entered each custom meal into my calorie tracking app. These were the steps I needed to have prepared so my plan for weight loss wouldn’t go off track, and while I have had a couple “cheat” days and bad weeks of being organized in my diet, I have lost nearly 20 pounds since I  began my journey 13 months ago.

There isn’t a doubt in my mind if I wouldn’t have taken the steps to actually understand and interpret what I needed to do to hit my goals that I would have failed miserably... again.  If you truly want to change your habits in your everyday life, you need to have a solid target to shoot for, and organize your life in the proper manner to make sure no matter what happens that you are in a position for success.  This may mean spending a little extra time and effort up front, but it will result in a higher probability of hitting your goals and avoiding wasted time going around in a circle.

Whether it is your weight, your finances, or something new you want to accomplish, understanding why it is important to you and what organizational approach you need to take along the way that will set you up for a higher chance of success.  If retiring earlier is on your mind or perhaps you aren’t enjoying your current line of work, know what you need to accomplish in order to make that happen and use organizational tools such as budget to understand where your money is going, how much is going to each area, and how much needs to be put towards your goal instead.  This will help you understand the timeline of your journey, and from there you can begin to develop checkpoints along the way so you don’t feel the “are we there yet?” syndrome kicking in.

If we set ourselves up for success, we can focus on taking our time and enjoying our lives in the process of reaching our goals.  When we don’t feel constantly stressed out about “how far behind I am”, we can take pressure off of ourselves and give the best version of ourselves possible to the things and people we love in our lives.

We hope you enjoyed our January series on getting organized!  Since February is the month of love, stay tuned for our series around love and finances!