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3 Small Things to Improve Your Finances in 2019

Improve Your Finances in 2019

Happy New Year!  Many of us look to improve our health with the turning of the calendar.  That health can be physical (1 in 8 new gym memberships are initiated in January!), mental, or financial.

Increase your 401(k) contribution

Did you know that in 2019, the maximum amount you can contribute to a 401(k) goes up to $19,000?  Seem unrealistic?  Try increasing your contribution by 2% over your current amount.  Keep doing that every year and watch the savings pile up!

Don’t have a 401(k) or other workplace plan?  You can open a Roth IRA and contribute up to $6,000 per year (or $7,000 if you are aged 50 or older).  If you are a small business owner, check out this helpful guide from Fidelity on the various types of accounts you can use to lower your taxes now, and have a nice nest egg at retirement.

Start a vacation fund. 

Is the pleasure of vacation ruined by the idea of paying back months of high interest credit card debt?  Give yourself the gift of an interest-free vacation by – yep, you got it – saving ahead!  That all-inclusive vacation in Mexico costs $2,000?  Save $200/month by automatically having the money deducted from your checking account to a Vacation Savings Account (this is not a real thing, just a name in your mind to make it fun).  In October, you will be ready for your margaritas and siestas.

Consolidate at least 2 accounts into one. 

An area that leaves people feeling stressed about their finances is often plain old organization.  Got 3 old retirement plans out there?  Call up the 800 numbers on your statements and tell them you want to move those accounts.  You can open a Rollover IRA in your own name or move the accounts to your current workplace retirement plan.  Either way, you’ll have fewer statements and a more cohesive investment strategy.  And, like getting rid of old clothes that don’t serve you, you will feel great about having less financial clutter.

Need help prioritizing financial health goals?  Contact Kristi for a 15-minute phone consultation to see if there is a fit for working together.

Defined Maturity Bond Funds: A New(ish) Investment Option

maturity bond funds, denver financial planner

In times of uncertainty (rising interest rates, tariff wars), investors understandably want predictability, even if it means sacrificing return.


Cash (savings accounts, money markets) offer stability, but not much interest.  For people who are working, I suggest you keep 3-6 months of expenses in cash for emergencies and invest the rest for longer term growth.  For retirees, a bigger cash cushion (1-2 years of expenses needed from your portfolio) makes more sense to insulate your need to pay bills from a recession.


Bonds offer better interest than cash, less volatility than stocks, but still do rise and fall in value.  Buying individual bonds can relieve some of this uncertainty.  Bonds mature at a pre-determined date and pay a set amount of interest in the meantime.  However, bonds sell in $1,000 increments, so it can take a lot of money to build a diversified bond portfolio.


Just as with stocks, most investors get their exposure to the bond market through bond mutual funds.  Unlike individual bonds, bond funds invest in a large pool of bonds.  As bonds in the mutual fund mature to cash, the fund manager buys more bonds.  These products don’t have a set maturity date.  The interest earned is usually better than money markets, and the principal of your bond fund can grow over time.  The principal can also drop, with no set date when it might come back up.


Here’s another option

Enter a new-ish investment option:  Defined Maturity Bond Funds.  Sometimes they are also referred to as Target Maturity Bond Funds.  These mutual funds invest in bond that all mature in the same year.  As the bonds in the fund mature to cash, they are not reinvested to buy more bonds.  At the end of the defined year, the whole fund will be in cash, effectively maturing like an individual bond.


These products offer an interesting way to take some of the uncertainty out of bond investing without the hassle and high capital need of creating your own bond ladder or bond portfolio.


In researching the investment firms offering Defined Maturity Bond products, I’ve seen some things to look out for:


 1. Not all of the big brands are offering them. And those who do can have a limited selection.  For example, Fidelity offers municipal defined maturity bond funds, but those aren’t great for IRA investors.    Vanguard, an investor favorite, doesn’t seem to be offering the products at all.


 2. Much of the inventory in this space is sold as ETFs (Exchange Traded Funds), not mutual funds. This means that prior to maturity, the shares of your bond ETF trade back and forth between investors like a stock or bond.  The perception of the value of the ETF, not its net asset value (NAV) is what determines an ETFs pricing before maturity.  With a Defined Maturity Bond ETF, after the holdings all mature to cash, the cash is sent to shareholders and the fund is liquidated.


If you have questions about how different bond products fit into your portfolio, contact me for an appointment!


Here’s How Investing in Productivity Can Change Your Business!

People are always wanting the sure thing investment.  Unfortunately, in the stock market, there is no such thing, but what about investing in your own productivity?  Now there’s a way to get a sure-fire return.


This week, I welcome guest blogger Arielle Minicozzi.  Even though I hate learning to use new technology, Arielle recently helped me with some automation in my practice. It’s the best gift I’ve given myself in a long time!


Kristi:  What are your favorite tools to increase workplace productivity?

Arielle:  The best productivity booster is my appointment scheduling tool. I use a program called Calendly, which allows contacts to schedule calls directly from my website or email. It saves so much time for both parties.

Another favorite is MailChimp. Instead of retyping the same email over and over, I can just schedule messages to send automatically once certain events occur.


Kristi:  How can process mapping (or workflow illustrations or whatever you like to call it) help us be more successful in our business and even life?

Arielle:  Process mapping is important because it forces you to hone in on what is important to you and your clients and why, and really consider whether you do an activity out of habit or necessity. It also allows you to identify gaps and obstacles in your existing process so you can address them before they become systemic issues.


Kristi:  What is the major hurdle for people to create more automated work flow?  How would you suggest we get over it?  What are the benefits?

Arielle:  The main hurdle for people to create a more automated workflow is fear of the unknown. If you’ve always considered yourself to be a technologically challenged person, that doubt will likely prevent you from exploring options that would otherwise be extremely helpful. Like with any doubt, the best thing to do is to jump in and try it out. Most programs offer free trials and others offer ongoing free access to lite versions of the program.


The benefit of automation is an enormous recovery of time and energy. If you don’t have to think about what to do next, you’re less likely to become distracted or frustrated. That frees up time to use for other, more important things like helping clients or relaxing. Even if your workflow isn’t fully automated, just taking that first step of setting up a scheduling application can open up a world of possibility.


Kristi:  Thank you Arielle, for your inspiring ideas!  For more information or to hire Arielle yourself, see her bio below:


Arielle Minicozzi, denver financial planner


Arielle Minicozzi worked six years in the mortgage industry and became a CFP® certificant before starting Sphynx Financial Planning in 2017. She has a passion for teaching millennials how to become financially free and also enjoys helping other financial planners refine their workflows and automate their processes. You can check out the company’s website at or book an appointment at

The Myth of Working Until You Die

working, denver financial planner

There is no doubt that I am getting crabby in my middle age, and one thing that gets my goat is when people tell me that saving is too hard, and they are just going to keep working until they die.  Physically, I am giving the speaker a bland smile and nodding, but inside I’m thinking, “You should be so lucky, pal!”


Let’s get real.


It’s true, people are staying in the workforce longer.  The U.S. Bureau of Labor Statistics reported in 2017 that 32% of people ages 65 to 69 were working, and 19% of people ages 70 to 74 were employed.  The projection for 2024 is that 36% of people ages 65 to 69 will be in the labor force, compared to 22% working in 1994.*


The reasons for this shift range are many:


  • Longer life expectancies
  • Better education leading to less physically laborious work
  • Not enough retirement savings
  • Just plain love of work


However, there are those who are forced to leave the workforce before they are ready.  Ageism is alive and well, and if you don’t believe me, read this article in Forbes detailing 11 sneaky ways companies get rid of older workers.


And then there’s the unexpected.


There is also the unexpected health change that can appear at anytime during our lives.  A 2014 Employee Benefit Research Institute survey found that 33% of workers expect to retire after age 65, but only 16% of retirees report staying on the job that long. The median retirement age in the survey was 62.  Forty nine percent of respondents said they left the workforce earlier than planned because of health reasons.


Why do I bother telling you all this sad news?


My takeaway, as usual, is that it’s never too early or never too late to start saving!  Your willingness to work until death may be there, but your body or boss may have other plans.  Reduce expenses and sock money away now.  Your older self will thank you!






Divorcing? Run away from home!

divorcing, denver financial advisor

Frequently when I’m talking to a new client, he or she will start of by saying “I’m sorry, I don’t have more saved.  Or, “I’m sorry, I made these mistakes in the past.”  Believe me, we all, even financial planners, have made money moves we regret.


One that came up recently in a phone consultation was a woman who had to file for bankruptcy because she kept her family home after her divorce.  She was beating herself up for that decision, but I have seen it so often.


So, for those of you contemplating divorce, and this goes for men and women equally, let me just lay it out there:  DON”T fight to keep the marital home.


Top five reasons


  1. It’s possible you barely could afford the mortgage and upkeep together. You certainly won’t be able to living off one income.


  1. The upkeep is a pain as a single person. You don’t have a spouse to stay home from work or help coordinate plumber visits.  Unexpected repairs could derail your fragile new single-person budget.


  1. Bad memories – this is the scene of your marriage ending.  Move on to a fresh environment while you heal from this trauma.


  1. You are staying put to not disrupt the kids or force them to move into a smaller house. Guess what?  The kids are disrupted already.  Just get them used to the new situation, housing and all, at one time.  They kids will recover, and you won’t be broke.


  1. The better asset to get in divorce is something liquid and that doesn’t have a huge mortgage on it. Think IRAs, investment accounts, pensions, etc.


Renting for the first year after divorce is a good idea.  It lets you get your feet under you financially without the pressure of financing a new mortgage and home repairs/improvements.


The lesson here – if you are getting divorced, run away from the home!

The SFP Channel: Resolving Credit Card Debt

If you’re like most Americans, you might be carrying a certain amount of credit card debt. But how can you get out from underneath that stress? Click on the video below to get manageable tips that will help you achieve your financial goals!


Check out this video!



If your finances look like a pile of puzzle pieces without any cohesive picture, I can help! With my experience and education as a Certified Financial Planner ™ designee, I will work with you to piece together your unique financial puzzle. All this without an accompanying sales pitch for investments or insurance. My services are fee-only, meaning my clients pay me directly for advice. I receive no commissions for selling investment or insurance products. The recommendations I make are what I feel are best for you without any conflict of interest from possible commission payouts. 


Mother’s Day & The Mother of All Gifts

mother's day, denver financial planner

Mother’s Day is just around the corner.  If you haven’t started shopping or made brunch reservations yet, take a page out of the rich and famous for ideas to let Mom know how much you appreciate her.


  • Pop star Rhianna in 2012 gave her mom a 5-bedroom house in Barbados.
  • NFL quarterback Terry Bridges’ mom rolls in her pink Cadillac Escalade thanks to his 2014 Mother’s Day gift.
  • Dwayne Wade gifted his preacher mother a church from which she could spread the good word.
  • Leonardo DiCaprio planted a grove of trees in his mother’s honor in 2006.  Well, I’m sure he had it done for him.  I can’t see Leo out there with his 21-year-old supermodel of the week girlfriend actually digging holes for trees.


What can the rest of us do for Mom that’s creative and within a reasonable budget?


mother's day, denver financial plannerBamboo Bath Caddy.  Who wouldn’t want this? $40 at


Basket of pampering lotions and potions – be creative.  Get her something she might not have tried like sheet masks, bath oil, or other newfangled beauty products.


Plan a picnic!  So much more fun than sitting in a crowded restaurant.


Schedule a spa treatment.  My mom and sister and I have had fun at the 5-Star Salt Caves in Denver.  Mom and I did a 50-minute treatment in the Himalayan salt cave and felt like we’d been breathing sea air afterwards.  We also did the ionic foot baths that pull impurities from your body out through the soles of your feet.  It was truly bizarre and disturbing, but so much fun!


Visit a winery together.  Just about every state has a wine industry these days.  Whether the wine is delicious or you’re happy to use the spit bucket, the tour will be different and educational.



Mind over Money with Dr. Alec Baker – Part Deux

Welcome to Part 2 of my interview with Dr. Alec Baker of Peak Living Psychology.  Today we tackle one of my favorite topics of mind and money – the act of consistently outspending income.


Let’s begin


KS:  When people spend outside of their means, what is at the root of that?


AB:  People’s spending behavior is generally related to their core beliefs.  People who spend more than they make are often either in denial of their financial reality or have some plausible reason why overspending doesn’t matter.


For instance, you might have a single income family where the primary earner insists paying for the top tier TV package with all of the bells and whistles because that is their reward for working hard and if they can’t afford that their all of their hard work is for nothing.  To admit that they can’t afford it would be deflating and lead to a sense of failure for that person.


As a result, they refuse to make a different choice and run a deficit on the family credit card each month that leads to truly problematic debt in the long run.  This sort of denial and AVOIDANCE is a common emotional response to an impossible or undesirable situation.


In another example, we can see that a sort of magical thinking about spending can give someone that plausible deniability that what they are doing will be ok in the long run.  Imagine a 30-something couple with two incomes and no children.  They love to travel the world and are both very optimistic about their future earning prospects.  One owns a business that is still growing and has a future earning potential of around $250k per year.  The other has just finished professional training school and expects to be making more year over year for the next five years or so.


These two have lots of optimism, so they take a trip to “Yacht Week” in Croatia that costs $7k per person and they add a stop in Paris for five days that adds an additional $2k per person because, c’est la vie!  They believe they won’t be able to enjoy it in five years because they might have kids and all sorts of other obligations and since the future is bright they don’t think much of the expense.


Even though their future earnings could support spending $18k in two weeks, their current earnings are closer to $125k combined and they have to do the whole thing on credit.  In the meantime, their balances are stubborn and their paying hundreds of dollars in interest payments.


KS:  There you have it.  Overspending your income has lots of reasons and doesn’t make you a bad person.  But, not recognizing the habit and digging yourself into lots of credit card debt or not having emergency savings will have long term negative consequences.


Stay tuned for next month’s installation about characteristics of people with great money habits.


Dr. Alec Baker

Dr. Alec Baker owns and operates Peak Living Psychology – a full service psychological services practice located in South Denver.  Peak Living Psychology offers financial therapy, traditional psychotherapy, and psychological assessment services to the Denver metro area with a focus on helping individuals and families cultivate the best things in life.  More information can be found at

IRAs – to contribute ore not to contribute?

IRAs, Denver financial planning

April 15th is just around the corner and one of the questions your CPA may pose to you is, “Will you make an IRA contribution for 2017 before the deadline?”  And you are thinking, “Should I or not?”


Individual Retirement Accounts (IRAs) come in a couple of flavors:  Traditional or Roth.

Traditional IRA

A Traditional IRA allows you to take a tax deduction for up to $5,500 ($6,500 if you are aged 50 or over) for putting that money in an account for your retirement.  The money needs to be left there until your age 59 ½ or you risk paying an IRS penalty of 10% for early withdrawal.  The growth is tax-deferred, meaning you will not pay taxes each year on dividends and capital gains generated in the account.  When you take the money out at retirement, the withdrawals are taxed at your ordinary income tax rate.


Who wouldn’t want that?  Turns out, you may not be able to take that lovely up-front tax deduction.  If you are eligible for a work retirement plan (even if you choose not to participate – FOOL!), you cannot deduct an IRA contribution if you make over a certain income.  Being subject to IRS rules, those limitations are tiered and complicated to write out, so click here for a handy table from your friends at the IRS.

Roth IRA

The other option you could use is a Roth IRA.  Roth IRAs do away with the up-front deductibility of the Traditional IRA.  In other words, the $5,500 (or $6,500 for you old folks) that you put in a Roth IRA would be the same as putting the money in a savings account from a tax standpoint.


The benefit – and it’s a big one – is that the money then grows tax-FREE so when you take it out after age 59 ½, you pay no income taxes on the withdrawal.


No matter what the tax benefit, you I’m guessing you should be saving more for retirement.  This is especially true if your accountant is telling you that you owe a tax bill.  If you are a small business owner, explore the plans available to you in addition to the accounts described above.


Happy tax season!

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