Latest news with #financial planning
Daily Mail
3 days ago
- Business
- Daily Mail
A tenth of families paying inheritance tax hit with £500K-plus bills
More families are being stung by inheritance tax , with nearly one in 10 of those paying the levy now being handed a bill of more than half a million pounds. A Freedom of Information request by Rathbones shows that 2,520 estates paid more than £500,000 in IHT in the 2021-22 tax year, a 29 per cent increase over three years. Of the nearly 30,000 estates eligible for the death tax, 1,630 paid between £500,000 and £999,999 in IHT, while a further 890 estates paid over £1million. If the current trajectory continues, over 3,524 estates will pay more than £500,000 in IHT by the end of the current tax year, based on an average increase of 8.74 per cent a year, according to Rathbones. Frozen thresholds combined with rising asset prices, including the value of homes, investments and savings, are already dragging more into death duties. Who pays inheritance tax? Currently, your estate needs to be worth more than £325,000 for your loved ones to have to stump up inheritance tax. This can be doubled to £650,000, jointly, for married couples or civil partners who have not already used up any of their individual allowances. A further crucial allowance, the residence nil rate band, increases the threshold by £175,000 each for those who leave their home to direct descendants, their children, grandchildren or great-grandchildren. Of these, 7,270 paid between £100,000 and £249,000, but the majority of estates paid up between £0 and £100,000. Rebecca Williams, divisional lead of financial planning at Rathbones said: 'The deep freeze on both the main nil-rate band and the residence nil-rate band, unchanged since 2009 and 2017 respectively, has led to a creeping form of fiscal drag. 'As house prices and asset values have steadily risen, more estates are being brought into the IHT net simply because the thresholds haven't kept pace with inflation . 'Without proactive steps, more estates will find themselves facing IHT bills they might not have anticipated.' There are growing concerns that the Chancellor could make further changes to IHT, including extending the seven-year gifting rule to ten years, which could drag more people into the tax net. Currently, no tax is due on any gifts you give if you then live for another seven years.
Yahoo
3 days ago
- Business
- Yahoo
Tony Robbins' Top 3 Tips That Will Save Retirees From Financial Disaster
One of the most popular and well-known money gurus out there today is Tony Robbins. For decades, Robbins has been releasing books, conducting seminars and giving financial wisdom to those who are seeking answers for how to get their money on track. Read Next: Find Out: One group that might need an extra bit of help are retirees. Luckily, Robbins has a bounty of methods for making sure they do not run their finances into the ground. Here are Tony Robbins' top three tips that will save retirees from disaster. Plan For Your Retirement Now For some of us, retirement might be just around the corner. For others, it can feel like lightyears away. Don't miss out on that time, whatever it might be, to allow for your retirement savings to grow, which means starting as soon as you can. To figure out the number you'll need to retire comfortably, Robbins recommends that you take it in several steps: calculate how much money it takes to maintain your current lifestyle, multiply that total amount by 20. It's important to be conservative with your numbers instead of overly optimistic. Once that figure has been estimated, it's time to start figuring out a retirement plan. 'The number you come up with may be massive — but don't be afraid to dream big,' advised Robbins. 'With the right mindset and relentless focus, you can go beyond 'How much do I need for retirement?' and start asking 'How much do I want for retirement?'' Consider This: Build a Money Machine How much someone saves for retirement will vary, as well as how they do it. But Robbins urges everyone to start building what he calls the 'money machine.' This happens by 'harnessing the power of compounding to create an income stream for the rest of your lifetime. In other words, you must automate your savings in a tax efficient manner and utilize an investment strategy that will keep earning in any season,' according to Robbins. Robbins highlights that one way to build the money machine is through compounding interest, which only can be truly utilized to its fullest with time. You can cultivate money in savings so that interest from these investments eventually generates enough income without needing to work a job. 'When you enter the second act of your life, you will have the freedom to work only if you want to,' Robbins said. Coordinate Your Planning for Retirement and Taxes 'With traditional plans, you don't pay taxes on your contributions at the time they are made,' Robbins explained. 'Taxes are deferred until you begin withdrawing from your plan — and then you are taxed at the current tax rate for your income bracket.' The plans that Robbins recommends retirees or those who are starting to think about retirement include traditional ones such as a 401(k), an IRA, and a Roth IRA. Knowing how much of your retirement plan will be going to taxes each year will help you plan accordingly versus getting a surprise tax bill. 'Don't be blindsided by the hit taxes can take against your nest egg,' warned Robbins. 'Protect your nest egg and protect your road to retirement. Ultimately, you're protecting your financial future — and nothing is more important than that.' More From GOBankingRates 3 Luxury SUVs That Will Have Massive Price Drops in Summer 2025 6 Popular SUVs That Aren't Worth the Cost -- and 6 Affordable Alternatives 3 Reasons Retired Boomers Shouldn't Give Their Kids a Living Inheritance (And 2 Reasons They Should) This article originally appeared on Tony Robbins' Top 3 Tips That Will Save Retirees From Financial Disaster
Yahoo
4 days ago
- Automotive
- Yahoo
Humphrey Yang Reveals How To Calculate How Much Car You Can Afford With The 20-4-10 Rule
How much car can you afford? Many people wrestle with this question, but financial personality Humphrey Yang recently broke it down to a simple formula. Knowing how much you can truly afford can help you avoid an expensive vehicle that ends up being more trouble than it's worth. The 20-4-10 rule has three components, and each of them influences how much you can spend on a car. Yang broke it down in a recent video while outlining practical strategies to keep your transportation costs low. Dissecting The 20-4-10 Rule Each number in the formula plays a key role. Yang believes you should put 20% down, finance a car for no more than four years, and ensure that your monthly car payments do not exceed 10% of your gross monthly income. Don't Miss: —with up to 120% bonus shares—before this Uber-style disruption hits the public markets Named a TIME Best Invention and Backed by 5,000+ Users, Kara's Air-to-Water Pod Cuts Plastic and Costs — Many dealers and lenders give you the option to put no money down, but you can get stuck with a car that eats up too much of your budget. Furthermore, if you don't put any money down, you will pay a lot more interest over the long run. The first two metrics are straightforward, but Yang also includes insurance and maintenance in the monthly payments. If you have a $750 monthly auto loan payment, but you also spend $200 per month on insurance and maintenance, your monthly car payment is really $950. Yang uses this number to calculate that you should gross $9,500 per month if you want to incur a $950 monthly car payment, including insurance and maintenance. Car Payments Are One Of Your Biggest Expenses Yang's calculator results in a monthly car payment that reaches 10% of your gross monthly income. Some people put a higher percentage of their income toward their vehicle, especially for luxury models. Trending: This AI-Powered Trading Platform Has 5,000+ Users, 27 Pending Patents, and a $43.97M Valuation — Not taking this decision seriously can result in unnecessary financial hardship. A car is the second-most expensive purchase you will likely make, outside of buying or renting a house. That's why it is extra important to run the numbers and strictly follow a framework like the 20-4-10 rule. When most people think of cutting their expenses, they think of ditching their daily coffee habit. While removing any cost will benefit your finances, Yang suggests focusing on the big-ticket items like a house and a car. If you're overpaying for your house and car, then skipping Starbucks won't have much of an impact on your finances. How To Reduce Transportation Costs Yang wrapped up the video by summarizing some of the ways you can reduce your transportation costs. Cutting these expenses will help you save a lot of money. You can use that extra money to grow your portfolio faster, go on an extra vacation, or give yourself peace of mind with a six-month emergency mentioned buying a used car, using public transit, carpooling, and riding a bike as some of the ways to reduce your transportation costs. Some old models still have a lot of life in them, and it's even possible to find an old model that's more reliable than a new car. Using public transportation, carpooling, or riding a bike from time to time can help you save money on parking costs. These are frugal decisions that can protect your wealth. Being frugal and aggressively investing money now can set you up for a robust financial future. Read Next: Warren Buffett once said, "If you don't find a way to make money while you sleep, you will work until you die." Image: Shutterstock UNLOCKED: 5 NEW TRADES EVERY WEEK. Click now to get top trade ideas daily, plus unlimited access to cutting-edge tools and strategies to gain an edge in the markets. Get the latest stock analysis from Benzinga? APPLE (AAPL): Free Stock Analysis Report TESLA (TSLA): Free Stock Analysis Report This article Humphrey Yang Reveals How To Calculate How Much Car You Can Afford With The 20-4-10 Rule originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Sign in to access your portfolio
Yahoo
6 days ago
- Business
- Yahoo
How Boomers Can Take the Guesswork Out of Retirement Planning To Know They Have Enough Saved
According to a new Vanguard consumer survey, many Americans are unsure about how much they should save or where to start. While the survey focuses on summer savings habits, such as building up emergency funds and reducing idle cash, it also highlights a deeper issue: Widespread uncertainty surrounding financial planning. Learn More: Read Next: How Much Money Is Needed To Be Considered Middle Class in Your State? This includes older Americans, such as baby boomers, many of whom are navigating short-term needs as they approach retirement age. Here's how boomers can take the guesswork out of retirement planning to know they have enough saved. Use a Retirement Calculator Nearly a third (28%) of all respondents listed 'not knowing where to start' as a chief reason for not saving more. However, guessing based on past income or general rules of thumb won't cut it, especially with inflation, rising healthcare costs and longer lifespans. Individuals can use retirement calculators from trusted financial institutions such as Vanguard or Fidelity to estimate how much they'll need to save. These tools typically factor in a person's age, expected expenses, desired retirement age and current savings to assess whether they are on track for a successful retirement. For those seeking a more tailored approach, working with a fee-only financial advisor can provide deeper insight. Advisors often use Monte Carlo simulations, a method that models thousands of potential financial scenarios, to help clients understand their likelihood of meeting retirement goals. Even using a general benchmark, such as aiming to replace 80% of pre-retirement income, can offer more clarity than relying on guesswork. Check Out: Start With the 50/30/20 Framework Not having a savings plan is comparable to driving without a map — forward motion may still occur, but the destination is uncertain. A strong financial plan extends beyond retirement, encompassing near-term objectives, emergency reserves and timelines for various investments. To reduce uncertainty, many financial experts recommend starting with the 50/30/20 framework, which involves allocating 50% of your income to essential needs, 30% to discretionary spending and 20% to savings and debt repayment. That final 20% can then be divided further to cover an emergency fund, retirement contributions and short-term financial goals such as travel or medical expenses. Budgeting tools like YNAB (You Need a Budget) or PocketGuard can help automate this process and provide real-time visibility into spending habits. For retirees or those in semi-retirement, income sources may include Social Security benefits, portfolio withdrawals or annuities. A structured withdrawal strategy, such as the 4% rule, can help ensure savings last throughout retirement by setting a sustainable pace for drawing down assets. Open a High-Yield Savings Account Many boomers have substantial savings in 401(k) plans or IRAs but lack readily accessible cash for emergencies or large purchases. Without liquidity, unexpected expenses can force you to sell investments or take on high-interest debt. Open a high-yield savings account (HYSA) with a competitive annual percentage yield (APY). Many currently offer 4% or higher interest rates. Keep at least three to six months of living expenses there. For added yield, consider a certificate of deposit (CD) ladder, which involves splitting money across multiple CDs with staggered maturity dates, ensuring some funds are always available. Vanguard and other brokerages also offer money market funds that combine safety with better interest than a checking account. Set Up Automatic Transfers Some boomers continue to earn high incomes, but steady earnings do not necessarily translate into long-term wealth. Lifestyle inflation, where spending increases as income rises, can quietly erode savings potential. In many cases, the lack of progress stems from failing to automate savings or establish consistent financial habits. To remove the guesswork, financial planners often recommend setting up automatic transfers from checking accounts into designated savings and investment accounts, timed to occur shortly after each payday. Using a percentage-based approach, such as allocating 10% to 15% of one's monthly income, can help individuals naturally scale their savings as their earnings grow. Reviewing one's savings rate twice a year and tracking net worth through platforms like Empower can provide valuable insight into overall financial progress. Use Free Tech Tools Many boomers still rely on paper statements or broad advice, overlooking tech tools that can simplify financial planning. However, today's platforms are designed to be user-friendly, even for those less comfortable with technology. Free tools from firms like Vanguard, Fidelity and Schwab enable users to set goals, model their income, and track their investments. Others, like Boldin and SmartAsset, help visualize scenarios such as downsizing or delaying Social Security. Even linking all accounts in a single dashboard can reveal gaps or inefficiencies, bringing greater clarity to a retirement plan. More From GOBankingRates How Far $750K Plus Social Security Goes in Retirement in Every US Region This article originally appeared on How Boomers Can Take the Guesswork Out of Retirement Planning To Know They Have Enough Saved Sign in to access your portfolio
Forbes
18-07-2025
- Business
- Forbes
Crafting A Family Legacy: A Financial Plan That Protects What Matters
If you want a blueprint for creating a family legacy, you must take a different route. Start by asking yourself one question: Why? Two couples walk into my office. Both are wearing the same brands of clothing, and are comparably dressed. Each pairing has roughly the same age, race, and educational background; from all appearances, you could guess they were clones of each other. And yet, when they each sit down to talk to me about financial planning, their situations could be miles apart. Anyone can come up with a basic financial plan that works for a family just by following common sense. But if you want something different—a blueprint for creating a legacy—you must take a different route. Start by asking yourself one question: Why? Those couples who hypothetically walked into my office may look the same, but their financial backgrounds and experiences can also be vastly different. This means their reasons for seeing me can be just as unique. So while I can give you a financial plan that explains how your future can be what you envision, the more important question I need answered is why. When you know why you want financial planning help, you can determine how to create that blueprint. Your reasons are going to be unique to you and your family. It could be about building generational wealth for your descendants so they can have financial freedom, or for ensuring your kids have a head start on their future, but your wealth does not fully subsidize it. Asking yourself why is a huge part of the process. The other part comes down to a topic I discuss extensively in my book, Values Over Valuables. What Are Your Values? Think for a moment about what having a legacy means to you. The word itself in its noun form is defined in a few different ways, but only two apply here: With the first definition, yes, your legacy is the wealth and goods you pass on to your family, and that's something I work on regularly. As for the second, this is the key. Your legacy can be the values you pass on to the following generations. This builds into something bigger than you or any stockpile of cash ever could become, and that's special. This also requires you to do some self-examination. What are your values? How do you share them with your family? Do you follow them all the time and use them as filters when you make decisions? Finding the answers to those questions will set you down the path to truly crafting a family legacy. How to Find Your Values This is oversimplifying things a bit. While it's easy for me to say you should go out and find your values, actually doing so is a little bit more complicated. I have a worksheet in my book that can help with the process. The first step is to find ten words that resonate with you. They're words like Balance, Independence, Humility, Respect, and so on. Once you find them, you should expand on those ideas. Why are they important to you, and what makes them valuable? Write all of this down on a piece of paper. Now have your family go through the same process. See what words you all have in common, and create a family values list. You can create core values out of this as well, which are the ones that, above all else, your family will always stick to. This is an enlightening process. By discovering the values you have in common with your family, you build a framework for how you live your lives. As your children grow, they will take these values with them and repeat the process with their own families. Some of them will take root and stick. Others may fall by the wayside. The result is a system unique to your family. Standing the Test of Time You've created a legacy—one that can last for decades, if not longer. It's a bit introspective, and it can create some friction. But in the end, your legacy is more than about money; it's about ideals and values. There's nothing more valuable than that.
