Market’s High — What to Do?

The stock market has posted really strong gains this year; in recent weeks it’s hit all-time highs.  We don’t believe in timing the market, but we do believe in sticking with an asset allocation that’s consistent with our risk tolerance.  Right now, the gains in our stock position (individual stocks & stock mutual funds) have thrown us out of whack – we’re more exposed to the stock market than we like to be.


The coolest thing in rebalancing to a pre-determined asset allocation is that it forces us to sell high and buy low!  Do we always hit the top & the bottom? Of course not.  But we didn’t get creamed in 2008, we stayed in the market without having to sell as it declined, and were forced (by our allocation) to buy near the bottom & ride it up.  Now we’re selling out some of those gains to pull back our stock position and invest in cash like CD’s and in short- to medium-term bonds.

Many of you have expressed interest over the past year in working with us on aspects of your financial plan and the allocation of your investments – including your 401(k), 403(b), 457 or similar plan.

Do you have a plan with Specific, Measurable, Achievable, Results-focused, and Time- bound goals?

  • If you’re under 50, you should be contributing as much as possible to your retirement account(s), you should know how you’re going to pay for kids’ education (if any), and whatever other medium-term SMART goals you have.
  • If you’re 50+, it’s time to start looking at SMART goals for retirement.  How much do you need, when, what you need to do differently in the interim (or maybe continue doing right)?
  • No matter your age, you need an asset allocation that fits your risk tolerance.  At the top of the market is when big losses happen to those who are taking too much risk.  Get a check-up!

Call, email or go to to schedule an appointment.  We do have time to get started while we’re still in Fort Collins, so get in touch soon.  We can get yours started before we meet!  Just ask for a list of items to begin assembling.

Talk to you soon.


“Mom, what’s a W-9?”  1099-MISC, W-4 Exemptions & More

It’s summer job time, time for new grads to find jobs, and it’s always a good time to take a better job!  But navigating the shoals of new hire paperwork can be hazardous.  I got this question just a couple of weeks ago from one of my own kids!

When you’re hired on at a new job, you normally have to fill out a W-4 and an I-9.  The first (and the state equivalent) require you to designate your number of exemptions for the income tax withholding calculation.  The latter, with your ID, proves your legal authorization to work in the U.S.

But sometimes you’ll be presented with a W-9 requesting your Social Security Number instead of a W-4.  Beware!  This employer is treating you as an “independent contractor” – a self-employed person – and will not be paying employment taxes or withholding income taxes for you.  They won’t be carrying workers’ comp insurance or providing any other benefits.  You will receive a 1099-MISC in January rather than a W-2.  If you’ll be making more than $1,000 or so, you could be in for a rude shock when tax time comes.

What are your options if you’re being treated as self-employed?

  • IRS and the states have rules about who qualifies as an independent contractor. There are 20 “tests” (here) but they add up to who controls the conditions of your work – the employer or you?  When do you work, where do you work, who decides how the work is done, whose tools & equipment are used, do you have a professional license/experience or do they train you, do you provide this service to multiple firms?  Are you paid for the work you accomplish – or hourly like an employee would be?
  • If you’re incorrectly classified, you can file the SS-8 with the IRS, and in the fullness of time you will receive a determination. Your employer will be in trouble, and you can count on being fired.  So for practical purposes, the only alternative if you want to retain the job is to put money aside and either pay quarterly estimated taxes or expect it to eat any other refund to which you’re entitled.  You’ll need to pay approximately 15% in addition to your income tax (on the first $118,500), but you may be able to deduct some business expenses.
  • Best to consult a professional, or use a calculator like the one here to make sure you won’t owe. You can make quarterly payments online at, or mail them to IRS in April, June, September & January.

If you *are* an employee, fill out your W-4 with care.  Basically, one exemption covers the standard deduction and personal exemption for a single person with one job.  If you itemize deductions, or have children (especially under 17), qualify as Head of Household or for Earned Income or other credits, you can increase it to 2 or more and have less tax withheld.  If you’re single with one job, you can safely use the worksheet on the W-4 form.  If you want a higher refund, reduce your exemptions to zero or add an additional dollar amount of withholding per pay period.

Common W-4 traps include:

  • Married couples – claiming Married can often mean owing, since the tables essentially assume you have a non-working spouse at home. If both of you have good incomes, beware. You may need to file as “Married but withhold at higher single rate.”  Consult a professional or use a comprehensive W-4 calculator like this one at to make sure you won’t owe.
  • Multiple jobs – if you work more than one job, each payroll calculation assumes that it’s all your income. But that $5,000 or $10,000 you make at your second job is taxed at your marginal (top) tax rate, which may be 25% or higher.  Again, consult a pro or use a calculator to adjust your exemptions; set them at Single – zero, and add a fixed amount, or see if your employer will withhold a flat percentage that corresponds to your top tax rate.

Remember, you must report all your income, even if you don’t receive a reporting form.  If you do receive one, IRS will be matching to make sure you report.  If you work in someone else’s home – providing childcare or other services – then you may be a household employee.  Your employer is required to withhold and pay employment taxes.  You can refer them to this info.

As always, call 513-794-1829 or email for a FREE consultation if you have questions.

Identity Theft & Taxes

This just in:

IRS Asking Some Taxpayers to Verify Their ID

Beset by ID thieves, IRS has set up filters to try to spot bogus returns before issuing refunds.  Of course, they’re not telling us what the screens are.  But some taxpayers may get an IRS Letter 5071C asking them to verify their identification.  If you get one, go to and answer some ID questions.  Processing will take another 6 weeks, so I hope you don’t need that refund immediately!  You can also call the toll-free ID Verification number in the letter.  Hopefully, they’re answering that one.

Ohio (and probably other states) have been using a similar program since the beginning of this filing season.  If you get a letter, follow the instructions.  If you pass the quiz, your refund will be released the next day.

REMEMBER:  IRS will *never* initiate contact via email or phone.  If you get a phone call claiming you owe IRS & threatening you, assume it’s a scam to get your ID or your money, or both.

Note that neither of these programs will ask you for credit card or bank info, only tax return info & innocuous information from your credit report (“third party authentication”) like which of several cars you’ve owned, or addresses you’ve lived at.

Call if you have questions.  I probably can’t come to the phone, but Brigid can handle your questions at 513-794-1829.

How Can Financial Counseling Help You?

Financial counseling can be the first step toward financial stability and wealth building.  With tax season behind me, now would be a good time to make an appointment.  Contact me via email, phone, or via my web scheduler (  Let’s talk about how you could improve your finances.   It can be simpler than you think to lower your money stress and make your life work!