Financial Gifts for Your Valentine

According to the National Retail Federation, total Valentine’s Day spending is expected to reach $19.6 billion, up from last year’s number of approximately $18 billion. Do you remember the first person you asked to be your Valentine? It was probably back in grade school when you were too scared to even say “Hello” to your crush. For some, Valentine’s Day is just another day, February 14th. But for many others, it’s a day to spoil your loved ones with flowers, candy, chocolate, jewelry, and so on. However, this year we’re fresh out of our heart-shaped chocolate boxes, so here are a few financial gifts to consider for your Valentine.

For your spouse or significant other, you might want to consider an IRA contribution. You won’t be able to directly contribute to their IRA, but you can write a check to them for that specific purpose. In 2018, you can contribute up to $5,500 to your IRA or $6,500 if you’re aged 50 and older. Or, if they’ve already maxed out on their IRA contributions for the year, then you can consider giving shares of a stock issued by a company that your spouse or significant other can relate to.

One of the most intimate things you can do with your spouse and loved ones is to open up on the estate planning conversation. Whether you need to update an existing plan or look into creating a new one, estate planning is an important piece to your overall retirement strategy, so don’t ignore the conversation. Think of it as a gift! It probably won’t make it into the gift hall of fame, but as hard as it may be to think about a plan for when you pass, passing without a plan for the distribution of your assets is even harder to imagine. Do you have a will? Is it updated to include your personal property? Who will be the executor of your estate? These are just a few of the many questions that need to be addressed during the estate planning conversation.

Now, for your kids or grandkids you might want to consider the 529 Savings Plan gift. Typically, you’re allowed to invest in the plan offered by any state, even if you don’t live there. But, if you’re investing in your own state’s plan, then you might be able to receive a tax incentive. Did you know that all withdrawals from 529 Savings Plans are free from federal income taxes, and in most cases state income taxes too? This holds true as long as the money is used for qualified college or graduate school expenses of the beneficiary you’ve named. Be careful because a withdrawal for a non-qualified expense could have a portion of it be subject to ordinary income tax and a 10% federal penalty.

Did you already forget about your parents this Valentine’s Day? Because we didn’t. If you’re fortunate enough to help them out financially, then you might consider paying for a month’s worth of their premiums on their auto or health insurance. Or, why not get them something that will make a meaningful difference in their life in retirement? You could arrange a complimentary, no obligation financial review with a trusted financial professional. Even if they already have one, it doesn’t hurt to get a second opinion review. Perhaps nobody talked to them about long-term care or estate-related financial strategies.

So, as you’re wrapping up that brand new necklace and getting dressed for your elegant steak dinner, why not consider a few financial gifts for your Valentine? The gift of financial independence may trump all, and the best way to get on the right path toward a safe, secure, and enjoyable life in retirement is to CLICK HERE and schedule your financial review.