• February 2015

Are You Taking Care of Your Financial Future?

By Bryan Beatty, CFP®, AIF®
CERTIFIED FINANCIAL PLANNER™
Egan, Berger & Weiner, LLC

Are you ready to take good care of your financial future? Try these tips:

  1. Take advantage of the increased contribution limits in 2015. Contributions to 401k and 403B plans have been increased to $18,000 (from $17,500) — and catch-up contributions have been increased to $6,000 for participants 50 and older, for a total of $24,000.

    Note: This is the year to sign up to have your contribution bumped automatically by 1 percent per year until it reaches the maximum. And remember, many employer plans offer matching contributions, so any amount up to a certain percentage that you contribute will be matched by the company you work for. Many plans offer automatic increase options on your contributions.

  2. Review your insurance coverage. When is the last time you checked your coverage under your life, disability, and homeowners or liability insurance? If your income has increased, or you haven’t investigated your insurance options in recent years, know that what was appropriate a few years ago may not be sufficient today to protect you and your family. Consider making one of your resolutions a commitment to review your insurance in during the first quarter of 2015.
  3. Re-balance your portfolio or portfolios. With the current dominance of stocks over bonds and domestic investments over foreign ones, it’s likely that your portfolio looks dramatically different than it did just a few years ago. This shift changes your risk exposure. If you haven’t been monitoring your investments closely recently, your portfolio’s risk metrics are likely higher than you realize. It is important that you check the risk profile of your portfolios annually — at a minimum.
  4. Consider a Roth IRA. If you are married filing jointly and your household income is less than $183,000, you may make a Roth IRA contribution. This is an after-tax contribution of up to $5,500, plus $1,000 if you are over 50.

    Note: This IRA grows tax-free if you leave it for a minimum of five years and withdraw it after age 59-1/2. If you make more than the income threshold, you may still be able to get into a Roth IRA in a strategy often referred to as the “back door” Roth IRA. This is the process of contributing to a nondeductible IRA, and making an immediate conversion to a Roth, which is not income-threshold dependent. Be careful not to do this without professional advice as there may be other considerations for those with other IRAs.

  5. Use a password program to manage your accounts. As I noted in my article on credit fraud, it is important not to keep passwords to your important financial accounts on a sheet of paper in your top desk drawer. See more details on ideas of how to protect yourself, below.


Is Your Financial Data Safe?

By Bryan D. Beatty, CFP®, AIF®
Financial Planner / Partner

Last year’s massive hacking scandal at Target, which compromised more than 40 million customers, increased the country’s awareness about credit protection.

The good news is that there are several things you can do to protect against a breach.

1. Consider using a credit monitoring service. The top 10 services can be found at stopcreditfraud.org. I personally use Lifelock.com, which monitors my credit rating and warns me when credit is attempted to be established in my name. The service also has the ability to alert me if there are any dramatic changes to my credit score and personal information.

But is that enough? I don’t think so.

2. Further protect your credit and personal finances from unwanted intrusion or fraud by doing the following:

  • Get a password program manager like Password XP, or other password managers recommended by PC magazine.
  • Use different passwords for each website you subscribe to.
  • Be careful not to write down your passwords in a spot where someone else can find them. Fortunately, a password manager makes that much easier. But if you opt not to use a manager, and must write down your passwords (after all, it’s virtually impossible to remember them all), don’t keep them in your desk drawer at work, or in your wallet.
  • Invest in virus-protection software. My two favorites are McAfee and Norton. The reality is that new spam and phishing emails and programs are created every day, so it’s important to protect your computer and data from hackers.

3. Protect the credit of your college students. For kids away at college, consider getting them re-loadable debit cards. It’s a great option for students who tend to lose things, or who might be the victim of a campus crime.

4. Check your credit file at least once a year, especially if you choose not to subscribe to a credit monitoring service. Three companies, which we link to below, offer this service and are required by law to provide a free credit report on request, once per year.

Another option: You can pay a small fee for a service that pulls all three files and provides you with your credit score, which is commonly referred to as your FICO score. This number accounts for a substantial portion of the credit report that lenders use to assess an applicant’s credit risk and determine whether or not to extend a loan.

Several companies offer free credit scores, including Discover, which includes customers’ FICO scores on its credit card bills each month. But Forbes magazine cautions that not all credit scores are alike.

The bottom line: Crime happens. Data breaches, which take their toll on companies and their customers around the world, are just one facet of financial crime. The takeaway message is this: Please, don’t be naïve.

Use common sense, and be cautious when using your credit cards to shop online and in stores. Knowing how to navigate the fraud-protection terrain gives you a leg up on protecting your identity—and your hard-earned money.

For more information, click here to read PC magazine’s article, “The Best Security Suites for 2015.”

“We’ve tested each component in more than three dozen security suites to help you choose the right software to keep your PC safe,” Rubenking says.


Bryan Beatty is a CERTIFIED FINANCIAL PLANNER™ Professional and partner at Egan, Berger & Weiner, LLC, which is based in Northern Virginia. With more than 20 years of experience in the financial industry, he is a principal of this independent financial services firm, which is experienced in all aspects of investment and retirement planning.

An active member of the Financial Planning Association’s Career Development and College Outreach Committees, Beatty is a graduate of the University of Maryland with a BS in Finance. He was the former president of the Finance, Banking and Investment Society, and he is an avid musician who plays guitar and writes music in his spare time, and occasionally plays area venues. Originally from Baltimore, Beatty has lived in Northern Virginia since 1992.

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