10 Best Money Advice Habits for Retirement

Retirement planning can be a complex and daunting task, but with the right guidance, it can also be an exciting journey toward a fulfilling future. Here are some of her valuable pieces of advice for those planning for their “golden years”.

1. Start Saving Early and Consistently

I cannot emphasize the importance of starting your retirement savings as early as possible. The power of compound interest means the earlier you start saving, the more your money will grow over time. Make retirement savings a regular habit, treating it like a non-negotiable monthly bill.

2. Know Your Retirement Needs

It is imperative that you understand how much you’ll need to live comfortably in retirement. This means calculating your retirement expenses, which will vary for everyone. Consider factors like healthcare costs, housing, and lifestyle desires. Planning with a clear goal in mind helps in creating a more effective savings strategy.

3. Maximize Retirement Account Contributions

It is advised that you make the most of retirement accounts like 401(k)s and IRAs. It is recommended that you contribute enough to get any employer match, as this is essentially free money. For those closer to retirement, taking advantage of catch-up contributions allowed for individuals over 50 can be a smart move.

4. Diversify Your Investments

Diversification is vital for minimizing risk and maximizing returns over the long term. It is suggested that you have a mix of stocks, bonds, and other investment vehicles. It is also emphasized that you review and adjust your investment portfolio regularly, especially as you get closer to retirement.

5. Pay Off High-Interest Debt

Before retirement, it is recommended that you pay off high-interest debt, such as credit card balances. This debt can be a significant drain on your resources, and entering retirement debt-free can provide financial and emotional relief.

6. Consider Delaying Social Security

Delaying Social Security benefits can result in larger monthly payments later on. Can I suggest waiting until full retirement age or even later, if possible, to maximize these benefits. However, this strategy should be tailored to individual financial situations and health considerations.

7. Plan for Healthcare Costs

Healthcare can be one of the largest expenses in retirement. Consider health savings accounts (HSAs) and long-term care insurance as ways to manage these costs. Being proactive about health and wellness can also help reduce medical expenses in the long run.

8. Create an Estate Plan

Estate planning is not just for the wealthy. We are underscoring the importance of having a will, a durable power of attorney, and a healthcare directive. These documents ensure that your wishes are followed and can prevent unnecessary stress for your loved ones.

9. Stay Informed and Flexible

The financial world is constantly changing, and so are personal circumstances. We encourage to always stay informed about financial matters and being flexible with your retirement plan. This includes being open to adjusting your savings rate, investment choices, and retirement age as needed.

10. Embrace a Mindset of Financial Independence

Embrace a mindset of financial independence, which involves living within your means and making informed financial decisions. This mindset is key to a successful and stress-free retirement.

The Takeaway

The takeaway of this blog centers around early and consistent preparation, understanding your personal needs, and staying informed and adaptable. These insights provide a roadmap for anyone looking to navigate the retirement planning process with confidence and clarity.

Thanks to Sheiresa McRae Ngo for article insights

10 Side Hustles For Women Over 50 - Rack Up Extra Cash Doing Something You Like

Whether you're working full-time, part-time, or you're retired, it's nice to have extra money coming in when you want or need it. Having a side hustle can pay for bills, vacations, or give you that extra padding for your retirement. The trick with any good side hustles for women, though, is flexibility. And the best way to make fast money with flexibility? Look to the ‘gig' economy: simple jobs or tasks you can do morning, noon or night that typically require no previous training or certifications.  All you need is a phone or computer. You simply decide when and where you want to work, then get paid!

So, what is a gig job”?  Gig jobs are perfect for times when you want to supplement your current income, you're in between jobs or you have caretaking responsibilities you need to work around. And with a wide variety of gig jobs available, from ride-sharing to grocery shopping, along with quick money­making side hustles like selling your clutter on eBay or giving your opinion at focus groups, chances are you'll find something that fits your needs and your schedule. 

The benefits: Not only are gig jobs easy side hustles for women, they're the fastest way to earn cash. Also, many companies handle promotion and get customers for you. Your payment can come as quickly as within a week after starting and sometimes sooner.

The financials: Most gig jobs are free to start. You may have fees (usually 5% to 25%) deducted from your earnings to cover a company's operational costs, such as websites and apps. If the job requires a car or tools, you'll supply your own. 

Earnings: You can earn about $7 to $25 per hour when working for a company, but there are ways to earn more, like working peak hours for higher rates and receiving bonuses for referring new employees. 

Taxes: You're considered an independent contractor. This means if you earn $400 or more during the year, you'll file a Schedule SE (Form 1040) to calculate income taxes and a Schedule C (Form 1040), showing profits and losses.

Getting started is easy!

Search “Top side hustles" online for ideas on what you may be able to do. Read on for 12 side hustles perfect for women.

1. Teach a class in your local community

Do you have something to share with your community, either a hobby or something from your professional life? Consider teaching others through community classes. To start with, check with your local rec department, library, or community center to see if they are looking for instructors. Don't be shy about pitching your own idea for a class. Many of these places will probably OK your idea. And who knows, you might end up loving teaching and passing on your knowledge or passion to others!

2. Become a consultant

A good way to stay involved with your professional side is to become a consultant in an industry you are familiar with. You might have methods of working or knowledge you can pass down to others. This is where LinkedIn can come in handy to figure out good side hustles for women. Connect with people you've worked with in the past and reach out to them to ask them about consulting opportunities. 

3. Walk dogs or pet sit

There are several apps available for pet sitting and dog walking that make great side hustles for women. Wag and Rover are two such apps to check out. All you need to do is create a profile and mark your availability. With pet sitting, you can offer to host in your home or go to theirs, so it's an easy and convenient way to make some extra money and to get your dog (or cat or rabbit or turtle) fix. With these apps, you control your hours, so you can really do it at your convenience. 

4. Work special events

If you don't want a regular gig, then consider applying to a place that just has special events. Sporting places, concert venues, and theaters are all good options. Summer is a great time of year to look for pop-up events like fairs, too. Check out what's available around you where you can pick up a gig from time to time. 

5. Rent out your home

Have you heard of AirBNB? It's a website and app where people can rent out their home to others passing through town. There are a couple of ways to do this. First, you can rent out a room and earn regular income. Or you can rent out your home when you're traveling or on vacation so they can have the entire place to themselves. It can be a little intimidating to think about doing this at first, but it's one of the best side hustles for women and an easy way to make extra money. Plus, there are sites where you can rent out your backyard, garage (Peerspace) or even your swimming pool (Swimply)! If you're considering it, try finding a group on Facebook to join. They'll be able to give you advice and answer all your questions.

6. Sell your crafts

If you like to knit, crochet, make quilts or anything in between, consider selling them to others. This is a really good side hustle to do with a friend. You can join up to motivate one another and even split the cost of a booth or space at a craft fair. If you're considering trying this one, go to a few craft fairs yourself to see what is popular and does well. This will help you figure out what to put your time into. Even baked goods might be the way to go for something like this. 

7. Become a ref, ump, or sports official

Training for these is often inexpensive, and there's such a need out there for good officials. This truly is a gig that's in high demand, but it's really flexible so you can take it on as you're available. If you're not sure where to look, start by contacting your area school, Little League organization, or another youth sports program. They should be able to point you in the right direction. 

8. Give rides in your community

Lyft and Uber are two very popular ways for people to earn side hustle income. All you need is a tidy car, and you can make yourself available to give rides. It's relatively easy to get set up, but you do have to like driving and being friendly to strangers. Other apps that pay? Kango (where you drive kids around) and CitizenShipper (where you drive pets).

9. Run errands or shop for others 

Shipt is an app that hires people to shop for others. There are other options, too, where you can run errands or pick up food for a fee. For instance, DoorDash is another one of the side hustles for women. Do a little searching to see what's available in your area. 

10. Teach English online 

There are a few different companies out there where you can work from home teaching English to kids, which makes a great side hustle for women. If the at-home option sounds like a good choice for you (and you like kids), check out VIP Kid. You can usually set your own hours, making it easy to work around your schedule.

Take what you're good at and spread the word to others

Whether it's any of the above or something else, sometimes you just have to be proud of your talents and share them with others. Are you a handyman or handywoman? Are you a good cook? Put a post out on Facebook or share with your friends that you're available for side jobs. You might be surprised what you get from just letting your own network know you're available. 

Thank you Womens World

11 Ways To Protect Yourself Against A Tax Audit

1. Be Careful with Reporting Expenses

If you report a net annual loss, the IRS may take interest in you, especially if the loss is major. The IRS may examine your return more closely if they suspect that the loss is the result of underreported income. While you must always report 100% of your income, you can avoid reporting excessive losses by reducing the number of deductions you claim. For example, writing off rent, car expenses, mileage, and technology can save you money, but they can also trigger an IRS audit if the numbers amount to more than you earned.

2. File on Time

Some believe that because fewer returns are in the pool to choose from, filing early in tax season increases the likelihood of an audit. Due to this misconception, many people file late or even ask for an extension. However, Bonadio Group partner and CPA Steven Terrigino asserts that filing after the deadline isn’t a wise strategy for avoiding an audit. Choose the filing option that is most comfortable for you, as this will create a history of compliance, including all ancillary returns—i.e., payroll and sales tax.

3. Think Before You Report Losses

The IRS can go easy on you if your business had a rough patch. Unfortunately, some business owners exploit it by showing made-up losses intentionally. The IRS’s perspective is that if you fail to make a profit in three out of the last five years, it is a hobby, not a business. The best advice: If you want business-related tax deductions, you should do your best to make profits. And don’t report losses for some peanut amounts of tax deductions.

4. Use a Separate Bank Account for Your Business

It’s advisable to use a separate bank account for your business. Not only for IRS purposes but also so you can better view all your finances. Connect it to a bookkeeping platform like Fincent. This ensures that no transactions are overlooked, simplifying your tax filing process.

5. Know Your Taxpayer Rights

Taxpayer rights are essential as they protect individuals from unfair treatment by tax authorities, ensuring a fair and transparent tax system. These rights guarantee that taxpayers can challenge the IRS’s actions, appeal decisions, and receive clear explanations of tax laws and procedures. Upholding taxpayer rights fosters trust in the tax system and maintains the principles of justice and accountability.

The Taxpayer Bill of Rights lists ten fundamental rights for all taxpayers, including:

• The right to quality service and fair treatment

• The right to appeal IRS decisions

• The right to challenge the IRS position and be heard

• The right to privacy and confidentiality

Citing these rights can help restrain invasive IRS agents who overstep their authority. Make sure any complaints reference the specific rights being violated.

6. Select a Reputable Tax Return Preparer

Getting sound tax counsel is essential if you want to legally reduce your tax liability and keep your tax return from receiving unnecessary attention. The IRS advises citizens to stay away from dishonest tax return preparers. The IRS may audit the preparer’s clients after locating them and reviewing their client list.

7. Stay Cautious About Certain Forms

Any information you enter into software, whether used by you or a tax expert to complete your tax return, automatically populates the return. But carefully consider whether to accept stances that recommend or require specific forms and schedules that all but ensure an examination by the IRS. Speak with a tax advisor about this. These include:

• Form 5213, Election to Postpone Determination as to Whether the Presumption Applies That an Activity Is Engaged in for Profit – This form is used if you have an activity and want to deduct losses but are concerned that you can’t prove this is a business rather than a hobby. The form postpones any inquiry until the end of 5 years (seven years for certain horse activities) but probably assures an IRS look at your activity at that time. If you have a realistic profit motive (there are nine factors that the IRS and courts look at), you can take losses and don’t need to file the form. But be prepared to back up your belief if your return is questioned.

• Form 8275, Disclosure Statement – This form tells the IRS about items or positions not otherwise adequately disclosed on the return to avoid certain penalties. Do you want to take this position?

• Form 8275-R, Regulation Disclosure Statement – This form tells the IRS that a position contrary to regulations is being taken on a tax return to avoid certain penalties.

8. Avoid Using Round Numbers

Use exact numbers wherever you can because round numbers can appear suspicious. If you round up to the closest dollar, the IRS usually doesn’t object. However, if you round up by tens or hundreds of dollars to get a nice, round number, that could lead to an audit.

• Acceptable: Rounding up from $2.60 to $3

• Not acceptable: Rounding up from $260 to $300

Ensure you aren’t using the same numbers year after year unless the numbers are correct and you have documentation. Expenses are expected to change; if yours haven’t, that could raise some red flags.

9. Record all IRS Interactions

Record all interactions with the IRS in writing. Make follow-up phone calls with confirmation emails summarizing the conversation. Don’t provide more information than legally required. Answer questions fully, but don’t volunteer extra details. Recording all interactions with the IRS is crucial for maintaining accurate and comprehensive documentation of your tax affairs. This practice provides a reliable reference in case of disputes and ensures transparency and accountability, aiding in the smooth resolution of any tax-related matters.

10. Avoid Being a Sole Proprietor

There are benefits to operating as a sole proprietorship, such as reduced paperwork, simpler taxes, and the ability to retain all profits. However, it’s important to note that the IRS tends to exhibit a bias against sole proprietorships in tax audits, with certain statistics indicating that businesses with this status face a 300% higher likelihood of being audited.

11. Don’t Leave Questions Blank

Fill out your tax return carefully and fill in all questions. Each question on the tax form should have an appropriate answer, even if that answer is $0. Avoiding the practice of leaving IRS forms blank is essential for preventing delays and ensuring accurate processing of your tax information. Filling out every section of the forms, even if the answer is zero or not applicable, helps to avoid potential misunderstandings, reduces the likelihood of audits, and facilitates a smoother interaction with tax authorities. An unintentional oversight could get your return some extra attention.

Great points brought to you in part by Jenna Gleespen at Budget and Invest.

The $10,000 Tax Rule

The $10,000 Tax Rule For Loaning Money to Family and Friends

Have you contemplated loaning money to family or even to friends? Did you know that there is a threshold after which the IRS gets involved?

According to the U.S. Code, that figure is $10,000. It’s referred to as the “de minimis exception” — referring to small loans from the tax agency’s perspective. The person receiving the money must not use the loan to generate income: As the U.S. Code states, “De minimis exception not to apply to loans attributable to acquisition of income-producing assets.” So, if you’re planning to lend loved ones some financial support, keeping it under $10,000 (and making sure the loan funds are not set to generate income) is wise……or else.

If you have decided that you want to loan more than $10,000, then there are some specific rules you have to follow. You’ll want to charge interest and it should be at least the same amount (or greater) than the current applicable federal rate (AFR) of the month during which you begin the loan agreement. The interest rate set should be reflective of the length of the loan term (short, mid or long) that you set up with your beneficiary.  This is an example chart from the IRS and can change month to month.

Applicable Federal Rates (AFR) for May 2023

Period for Compounding

Annual Semiannual      Quarterly     Monthly

Short-term

AFR                             4.30%             4.25%            4.23%            4.21%

Mid-term

 AFR                            3.57%             3.54%             3.52%            3.51%

Long-term

AFR                              3.72%              3.69%            3.67%            3.66%

It’s important to establish an interest rate with your borrower because the IRS can tax you (as the lender) on what is referred to as “imputed interest” and — if you aren’t charging interest to your family or friend — you could suffer a net loss from the transaction.

In every case, you’re going to want to document the terms of the loan with your borrower(s) and have a signed agreement involving any relevant parties. The agreement should clearly list full details of the arrangement in case you are questioned by the IRS. This is also imperative if you “forgive” the loan due to unexpected circumstances.

“Some kind of agreement is great for you and great for the person who’s borrowing from you because in a loving and caring way it kind of forces their hand when it comes to repayment.”

It is important to be clear on expectations in the agreement. The agreement should note how much money is being borrowed, if it’s a lump sum or paid out in installments, and how (and when, of course) it’s to be repaid. In addition, it’s wise to note when payments will start and end, the day of the month they will be paid and how much each payment will be.

3 Self-Made Millionaire Habits

Identity theft

Are you the victim of identity theft or do you know someone who is? Please don’t panic because that will just make things worse. Here are four crucial steps to take if you are a victim.

1st. You have to file officially with the FTC at identitytheft.gov. They will assist you with the entire process and make the situation a lot less traumatic.

2nd. Contact all your banking institutions including but not limited to banks that hold your checking and savings accounts, banks that issued you credit cards etc. They too will take you through a step by step process.

3rd. You must contact the Internal Revenue Service and file form 14039. This step is important because it will stop any thief from filing tax returns on your behalf and or stealing any possible refunds.

4th. Finally, you should contact all three credit bureaus, inform them of the situation and ask that fraud alerts be turned on. Below are their names and numbers for your convenience:

Experian 1-800-525-6285

Equifax 1-888-397-3742

TransUnion 1-800-680-7289

Freedom of speech

Hello everyone! The Lori’s Loop blog is back, happily, by popular demand. On this #WisdomWednesday, I must jump in with a super hot and very heated topic. I would be remiss if I kept quiet on something that could potentially affect my readers businesses and or business relations. That being said, I am going to give you a short response while keeping completely politically neutral. Let’s see how this works out.

The First Amendment to the U.S. Constitution protects the freedom of speech, religion and the press. It also protects the right to peaceful protest and to petition the government but let’s just stick to freedom of speech for the sake of this blog post. Living in this “free society” and having this right afforded to us insures that we live, breathe and thrive in a democracy.

As with anything in life, the First Amendment does have exceptions. Some of these exceptions include but are not limited to include obscenity, fraud, child pornography, speech integral to illegal conduct, speech that incites imminent lawless action, speech that violates intellectual property law or true threats.

Having said that, simply put, yes, you have the right to say whatever you want, however you want, whenever you want, on whatever platform you choose and to whomever you want. Now, just because it is your right to say something DOES NOT mean that there will not be consequences to whatever you chose to say. This slight shift is where most people get stuck. Just because you have the right to say something does not mean your target doesn’t have the right to react accordingly. This is the part most people cannot seem to link in their head. Here’s a silly but to the point example to try and bring this home to you. If you walk up to someone on the street and you punch them in the face, don’t be upset if they pull out a knife and stab you. I know we aren’t talking about physical violence but words that shoot out of your mouth can incite violence and or violent behavior. Stop being shocked when someone does not react at the same level that your words came out. You have the absolute right to say what you want and the recipient of your right also has a right to ignore, react in kind or totally destroy you with their rights. You have the right to walk into your bosses office and tell him that he is a jackass. That in fact is your right but your boss has the right to fire you….consequences. You have the right to tell off a client of yours. That is your right but your client has the right to take their business elsewhere…..consequences. You have the absolute right to your free speech, just be prepared to stand by your convictions.

The point, an intelligent and strong person will choose their words wisely. They will exercise their rights properly and, they will accept that there could possibly be consequences to each and every action they take. Stop standing behind half of the First Amendment and learn to look through both eyes, listen with both ears and think before you speak. This discipline alone will catapult you through life…..successfully, monetarily and safely.

Today I have a great choice for your reading enjoyment. The book is called 3 Word Rebellion: Create a One-of-a-Kind Message that Grows Your Business Into a Movement. Go borrow a copy from your local library or from a friend as soon as you can. If neither option is available to you, I am attaching a link so that you can get it from Amazon. The link is>> https://amzn.to/2saavsf

If you choose to shop in Amazon, I would greatly appreciate it if you could use the link I have provided. As an Amazon Affiliate, it is possible I can earn a bonus and therefore continue to provide continued content we all enjoy. Thank you in advance!

Finally, please stay in the know by subscribing to Lori’s Loop and never miss another posting. You can’t go wrong with constant free life and business advise so please click to subscribe! www.themainhustle.com/subscribe

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4th Quarter