One of the most common sources of conflict in relationships is money. If you are lucky enough to have found someone who you are compatible with, the last thing you want to do is jeopardize the life you are trying to build together because conversations around money are getting in the way.  Discussions about finances between partners often become emotionally charged, especially when it involves different values around money.  Fortunately, whether it’s about spending habits, saving for a desired goal, investing or paying off debt, having healthy discussions about finances is a skill that couples can learn to develop together.

Understanding what drives your partner’s emotions about money is key to turning these discussions into honest and productive conversations.  It can be helpful to discuss together what your experiences were like with money growing up.  In some households, speaking about money can be considered taboo while in others they are open discussions. These early experiences shape the way we view money and inform our decisions as adults on how we choose to spend, or not spend. Understanding that your partner grew up with a financially irresponsible parent due to a gambling problem can go far when trying to understand why your surprise purchase of an expensive custom suit quickly became a serious issue. On the flip side, your partner’s understanding that your purchase of a custom suit was because you felt you could finally afford it and deserve it seems less frivolous when it’s known that you grew up with years of being bullied as a child for your second-hand clothing.

The benefit to understanding your partner’s emotional connection to money is that it can open the door for truly honest conversations.  If you both come from a place of understanding you create a safe space to share information, even if it means sharing things you may not be proud of.  Hiding debt or overspending is a deception that can have serious adverse effects on a relationship.  Like lying, it can wear away at the trust that exists between you and could be your downfall.  It’s imperative to have an honest conversation about any debt or unhealthy spending habits.  If you can agree to a plan to pay off the debt or plan a budget that includes a set amount of savings these issues can easily be figured out before they become your undoing.

Starting and regularly having these money discussions can be difficult but money is a part of life – and maintaining openness around it with your partner is key to prevent it from becoming an issue.  Like most aspects of a relationship, communication is everything.  Sharing priorities and agreeing on common goals together will allow you to more easily create a path forward. Focus on each other’s strengths, always keep each other in the loop and your money conversations can become a part of your relationship that serve to reinforce your shared visions and dreams and further strengthen your partnership.

For the past 20 years Lighthouse Financial Advisors has been committed to reducing stress and keeping couples happy by coaching them through financial matters.

When you know what you want in life and you strive to reach it, you can accomplish almost anything.  It’s easy to dream big and create goals, but how do you go about accomplishing those goals?  Below are a few steps to follow to keep you on your path:

1. Write down all of your goals – seeing them written down on paper helps to solidify them in your mind.
2. Prioritize – Now that you have written them all down. Decide which goals are most important and what you want to accomplish first.  Trying to focus on all your goals at once often leads to being overwhelmed, stressed, and disorganized, making it much harder to accomplish any of your goals.  Focusing on your top 1,2, or possibly 3 goals creates a better chance of success and enables you to then focus on your next set of goals.
3. Clearly define your top goals and create a timeline – This allows you to focus in on exactly what you want to accomplish and how long you expect it to take. Be sure to consider outside pressures and set realistic, attainable expectations.  Having appropriate expectations creates manageable action items, reduces stress, and increases your chances of success.
4. Break down large goals into smaller goals – Very large goals can create stress and lead to you to feel overwhelmed making it hard to focus on what needs to be done to accomplish them. Breaking large goals into multiple smaller goals enables you to create manageable action items, which will enable you to stay positive, and hopefully stress free.  Accomplishing multiple goals also creates consistent success which in turn encourages you to keep going on your path.
5. Create a plan and track your Progress – Creating action items helps you to plan ahead to ensure you have the materials and time you need. Tracking your progress keeps your mindset positive and encourages you to continue on your path. This can be done several ways depending on the goal.  Sometimes the progress is evident just by looking.  For example, repainting a room, you can see the difference when you cut in, apply the 1^st coat of paint, and the second.  Other goals can be measured and tracked numerically such as increasing your savings account to a specific amount.  You can track your progress by watching the balance increase.  Other goals are harder to see such until completed such as obtaining a degree.  One way to track your progress would be to create a master checklist of all the classes you need to take and mark them off as you complete them.  Whatever method you choose make sure it is one that will help you stay motived.
6. Tell a friend – Having someone to hold you accountable when you slack off on your goal and encourage you when you are struggling makes it easier, and hopefully more fun to stay on task and keep you motivated.

No matter how much you plan you will always run into obstacles.  Sometimes the obstacle is yourself and you lose focus, get discouraged, and cease to make progress.  Other times the obstacle is an unexpected event out of your control, such as a car crash, illness, unplanned child, loss of job, a promotion at work with additional expectations or even a required relocation.  Regardless of what causes you to derail your progress it is important to find a way to get back on track.  Here are a few suggestions to get you back on the path to your success:

1. Acknowledge mistakes – Everyone makes mistakes from time to time. It is important to recognize what you have done wrong so you can hopefully avoid it again in the future.
2. Forgive yourself – Don’t harp on the mistakes you have made. Focus on moving forward and remaining positive.  A “you can do it” attitude goes a long way when trying to accomplish a goal.
3. Identify roadblocks – Knowing what your difficulties are enables you to manage the impact they make or even makes it possible for you to avoid it in the future.
4. New action plan – Sometimes you get so far off course that some of the steps or timeline expectations need to be changed. Other times the obstacles that occur force you to reevaluate your priorities and change your goals.  Do not resist altering your goals if they are no longer what you want.  Life is everchanging so it is important that your goals change to fit your wants and needs.

While the COVID-19 pandemic continues to be challenging to say the least, it presents an opportunity for communities to come together and for us to give back.  Charitable giving is meaningful for a multitude of well documented reasons. In addition to helping those in need or just brightening someone’s day, the simple, selfless act of helping others provides a great sense of personal satisfaction and growth.

While writing a check is undoubtedly helpful, small acts of service can really add up and go a long way.  Here are a few meaningful ways to pay it forward and give back to your community today:

1. Cheer Up Those Around You. Give an old friend a call, check in on your neighbor, or simply make eye contact and give a wave the next time you’re on a walk or in the store. A smile or kind social interaction can go a long way!
2. Donate your time. Seek out local institutions looking for volunteers or donations.  If you’d rather not go out in public, offer your services or skill set. Do you know of a friend out of work? Offer to proofread their resume, make an introduction, or practice a mock-interview with them.
3. Support Local Business. Local businesses have been hit hard during this period of social-distancing with Americans out and about less. Consider picking up a bag of coffee beans from a local coffee roaster (Rook Coffee is my personal favorite!), or simply supporting your favorite local restaurants. All of these establishments play a part in making your community a place you call home, supporting them helps keep them going.
4. Tip a little Extra. Now that we’re heading back to the salons, barbershops, and beginning to dine out, consider tipping more generously. It is no surprise that these industries have been deeply affected by the economic impact of COVID-19, so as we begin to support these establishments, keep the local workers in mind. With the reduction in hours and a reduced customer base, a little bit of an extra tip, if you’re able to, can make a huge difference.
5. Do Your Research & Donate Money If you’re able to give monetarily, do the research to ensure your money is being effectively used by the charity. Donate locally, and if you’re donating to a larger institution be sure to vet them in advance. There are charity assessment tools which rate organizations based on financial transparency and how much goes toward the cause versus marketing, fundraising or administrative costs. Also, it doesn’t hurt that monetary donations have tax advantages too!

While social distancing can make us feel insular, a sense of community has never been more important. Consider some of these tips to help us all get through this challenging time, together

The CARES Act is 335 pages and has created a lot of opportunity for proactive tax planning, along with a lot of acronyms – CARES (Coronavirus Aid, Relief, and Economic Security Act), PPP, PUA, FPUC, EIDL, PPPHCEA & PEUC (Pandemic Emergency Unemployment Compensation) or Payments extend until Christmas.

A few of the CARES Act law changes for tax year 2020 on retirement accounts –

• No RMD (Required Minimum Distribution) required for 2020 -YES not required to take funds from your IRA for 2020
  • Waiver applies to Traditional IRAs, retirement plans – SEP, SIMPLE, 401(k),403(b) & 457(b)
• No required distribution from Inherited IRAs or Inherited ROTH IRAs for 2020
• You can still take a distribution from your IRA if you need or want to (Taxes still apply to the distribution)
• If someone passed away in 2020 and did not take an RMD the estate is not required to take the RMD.
• Qualified Charitable Distributions are still allowed even though RMDs are not required
  • QDC – Charitable contributions paid directly from your IRA to the charity (Must be 501(c)3 & you need to be 70 ½)
• Special Tax Relief for those who qualify – Coronavirus Related Distribution – CRD
  • Allows $100,000 penalty free distribution from IRA or company retirement plan
  • Don’t have to be over 59 ½
  • Allows distribution to be repaid TAX FREE – repayment period begins day after funds are received
  • OR allows Federal tax to be paid over 3 years / State income tax may vary
    • Qualifications only those individuals
      • diagnosed with the SARS-CoV-2 or COVID-19 virus by a test approved by the CDC
      • spouse or dependent is diagnosed
      • who experiences “adverse financial consequences” from being quarantined; being furloughed or laid off or having work hours reduced; or being unable to work due to lack of child care; or have closed or reduced hours of a business they owned or operated
  • Distribution taken prior to CARES Act also qualify

A lot of tax planning to think about and review for your 2020 tax projection. As with all tax law changes, we will work directly with you and apply these changes to your unique tax situation.

1. Begin your College Education in Fall of 2020 at the school you originally planned?
2. Enroll at your local Community College for the first year or two, then transfer to another university or college where you can earn your diploma from?
3. Take a “GAP YEAR”?

With all of the UNKNOWNS and UNCERTAINCIES, most Universities and Colleges are not yet clear on what the Fall 2020 semester will be.  There is a possibility that they will offer only remote learning and no on-campus living.  OR, it is still possible that schools will reopen (possibly) with limited classroom access for physical attendance, exercising social distancing and strict precautionary measures with specific limitations for safety.

1. Your original College enrollment – If you decide this is what you want to do, your school will most definitely work to make sure you get the best college education and experience possible. It may not be the “typical or traditional” semester, but you should be confident that your University/College will provide the education you expect and deserve.  We suggest to contact your school for the latest and most updated information about your Fall 2020 semester.
2. Community College – Some students may opt to enroll in their local Community College for their initial year (or two). This can possibly save some tuition costs while taking some core (or mandatory) classes that could be transferrable to their next school of choice from which they will earn a degree.

Finance and Career Counselors are always on hand to discuss students’ options and help guide them to make the right decision for themselves.

More information on this is cited on CNBC:

Community colleges could see a surge in popularity amid Covid-19

https://www.cnbc.com/2020/04/22/students-consider-starting-out-at-community-college-amid-coronavirus.html

3. Take a “GAP YEAR” – Some students (especially during this COVID-19 pandemic) may be considering deferral of beginning college, or applying for a “Gap Year”.

Taking a “Gap Year” may be a consideration or viable solution for those students who are not absolutely sure how to proceed with their college education.  There can be many reasons why a student is confused or conflicted about beginning the next phase of their higher education.

All Universities and Colleges have Guidance/Career Counselors and Finance Counselors on staff and are there to help students when making these decisions.  If you would like to discuss all options, you should contact your school to make a (virtual) appointment.

More information on this (including Pros and CONS), cited on AccreditedSchoolsOnline.org.

Taking a Gap Year Before College

https://www.accreditedschoolsonline.org/resources/taking-a-gap-year-before-college/

and/or from: The Wall Street Journal

Gap Year Ideas for College Students

https://www.nytimes.com/2020/04/23/well/family/college-students-gap-year-coronavirus.html