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Compensation: RSUs (Restricted Stock Units)
 
02:07
Congrats on that new job offer! Here's what you may want to consider if you're set to receive company equity. Kevin Mahoney is the founder & CEO of Illumint, which offers fee-only financial guidance for millennial parents. For more info, check out illumintadvisors.com. You also can connect with Kevin on: FACEBOOK https://www.facebook.com/illumintadvisors TWITTER https://twitter.com/illumintCEO INSTAGRAM http://instagram.com/illumint YOUTUBE http://www.youtube.com/illumint Video Transcript: Good morning! I’m Kevin Mahoney, the founder of Illumint, and I’m outside Amazon’s Washington, D.C. office to talk about what factors you might need to consider if your employer offers you equity in the company as part of your compensation package. Equity generally comes in two forms: Restricted stock units (or “RSUs”), which I’ll discuss today; and Stock options, which I’ll cover later this week. For now, let’s stick with RSUs. Restricted stock units aren’t actually stock. They’re just a promise from your company. Typically, the timing with which that “promise” turns into shares of stock that YOU own depends on the company’s “vesting schedule.” RSUs often “vest” incrementally, which is a sneaky way that companies incentivize you to remain in your current job -- if you leave the company before the vesting schedule ends, you miss out on the shares that haven’t vested yet. As RSUs vest, they also turn from a promise into tangible compensation, which means taxes. For RSUs, you’ll pay taxes on the current market value of the shares, based on your ordinary income tax bracket. Your company usually will withhold the tax on your behalf -- so you don’t need to find excess cash to send to the IRS. There’s a second type of tax potentially at play here, which is capital gains tax. If you hold on to your vested shares for a period of time and the stock price increases, then you will owe capital gains tax on the earnings, whenever you decide to sell the shares. If you sell the shares immediately after vesting, though, you likely won’t owe much (if anything) in capital gains tax. Your decision to hold or sell your shares may depend on numerous variables, but keep one important thing in mind: this is an investment in your own company, which also pays your salary. If the company begins to struggle, you’re at risk for both investment losses and unemployment -- ouch. For this reason, you may be better off diversifying your investment Check back soon to learn how, compared to RSUs, stock options present a slightly different set of income and tax considerations.
Views: 52 Kevin Mahoney, CFP
College Savings: 529 Plans & Roth IRAs
 
02:29
529 plans are a great education savings option, but for new parents, college is 18 years away. A Roth IRA may help you to mitigate your risk and pursue multiple goals. Kevin Mahoney is the founder & CEO of Illumint, which offers fee-only financial guidance specifically for the millennial generation. For more info, check out illumintadvisors.com. You also can connect with Kevin on: INSTAGRAM http://instagram.com/illumint FACEBOOK https://www.facebook.com/illumintadvi... TWITTER https://twitter.com/illumintCEO YOUTUBE http://www.youtube.com/illumint Video Transcript: Hey everyone! I’m at Cardozo High School in Washington, D.C., today to talk a little bit about 529 plans, and one common scenario in which you may be better off taking a slightly different approach to education savings. 529 plans are a great education savings option. You may have heard already that they can qualify you for a state income tax deduction. But there are other advantages, too: They’re easy to set up. You don’t need to pay a fee to some large financial corporation in order to start contributing. Unlike some other college savings options, people aren’t prohibited from opening an account if their income exceeds a certain threshold. Plus, any of your friends and family can contribute, too! You can use the funds tax free for education expenses ranging from kindergarten all the way to grad school. And you can use the funds for room and board -- not just tuition & fees. For financial aid purposes, a 529 plan is considered a parent asset, not a child asset -- which means a smaller percentage of the account value factors into how a school calculates your financial aid package Finally, you can change the beneficiary to another immediate or extended family member at any time if, for example, your oldest child doesn’t end up needing the funds. This last advantage raises an important point. For new parents, college is 18 years away. How do you know that your child won’t receive a scholarship? Or that our education system won’t fundamentally change in some way? Sure, if we all had unlimited income, there wouldn’t be much downside to funding a 529 plan. But given that we struggle to save for retirement already, it’s a little risky to set aside limited funds for a relative unknown. Here’s where you might think about education savings differently, and turn your attention to a Roth IRA. Like a 529, Roth earnings also grow tax free. But unlike a 529, you can withdraw your contributions at any time and for any reason, without taxes or penalties. On top of that, there’s no penalty for withdrawing any *earnings* to pay for the same qualified education expenses. You’ll still owe some taxes, but you’ve gained the flexibility to use your investment for school and/or retirement. Remember: a Roth IRA doesn’t need to fully replace a 529 plan if you’re set on saving for future education expenses (and there are reasons why it shouldn’t). But it’s an alternative that looks out for both your kids and you. Required Disclosure: The information on this site is provided “as is” and without warranties of any kind either express or implied. To the fullest extent permissible pursuant to applicable laws, Illumint disclaims all warranties, express or implied, including, but not limited to, implied warranties of merchantability, non-infringement and suitability for a particular purpose. Illumint does not warrant that the information will be free from error. None of the information provided on this website is intended as investment, tax, accounting or legal advice, as an offer or solicitation of an offer to buy or sell, or as an endorsement of any company, security, fund, or other securities or non-securities offering. The information should not be relied upon for purposes of transacting securities or other investments. Your use of the information is at your sole risk. Under no circumstances shall Illumint be liable for any direct, indirect, special or consequential damages that result from the use of, or the inability to use, the materials in this site, even if Illumint or a Illumint authorized representative has been advised of the possibility of such damages. In no event shall Illumint have any liability to you for damages, losses and causes of action for accessing this site. Information on this website should not be considered a solicitation to buy, an offer to sell, or a recommendation of any security in any jurisdiction where such offer, solicitation, or recommendation would be unlawful or unauthorized.
Views: 81 Kevin Mahoney, CFP
Student Loans: Consolidation vs. Refinancing
 
02:45
You may have options if student loan payments are eating up too much of your monthly budget. But what are the implications of consolidation and refinancing? Kevin Mahoney is the founder & CEO of Illumint, which offers fee-only financial guidance specifically for the millennial generation. For more info, check out illumintadvisors.com. You also can connect with Kevin on: INSTAGRAM http://instagram.com/illumint FACEBOOK https://www.facebook.com/illumintadvi... TWITTER https://twitter.com/illumintCEO YOUTUBE http://www.youtube.com/illumint Video Transcript: I’m outside the U.S. Department of Education today thinking about student loans, particularly the difference between loan consolidation and loan refinancing. Perhaps you’ve had a moment where: you’ve finished grad school, the grace period on your loans is about to end, and you’re not pumped about how much of your budget those monthly loan payments will eat up. So let’s look at the differences between consolidation and refinancing, and see how each strategy may impact you. Most often, the term “consolidation” applies to federal loans, while “refinancing” involves at least one prive loan. Loan consolidation is the act of combining different loans into one single loan: one servicer, one payment. It’s important to note, though, that with federal student loan consolidation, your interest rate does not decrease. Why consolidate then? Today, you’re most likely to do so in order to qualify for an income-based repayment plan. You also may consolidate in order to switch from variable interest rates to a single, fixed interest rate. Consolidation might help you to become better organized, but you’re now just as likely to be able to track different federal loans using the same account login. Think carefully before you sign up for a loan consolidation that extends your loan term. Your monthly payments may decrease, but you ultimately could pay thousands of dollars more in interest. Consolidation also averages your existing interest rates to generate the new combined rate that you pay, which prevents you from eliminating your highest interest debt first. For loan refinancing, you’re replacing one or more existing loans with a new, private loan that offers different terms, primarily a lower interest rate. If you’re paying a high interest rate on private loans and you have a strong credit score, you’ll often realize pretty quickly that refinancing to a lower rate is a good move. The decision gets dicey, though, when federal loans become involved: you generally don’t want to refinance a federal loan with a private lender. If you do, you typically lose a number of protections and benefits that the government offers, such as income-driven repayment, deferment, and loan forgiveness. While many loan forgiveness programs aren’t perfect and present their own risks, you probably don’t want to abandon any significant credit you’ve earned with them. Required Disclosure: The information on this site is provided “as is” and without warranties of any kind either express or implied. To the fullest extent permissible pursuant to applicable laws, Illumint disclaims all warranties, express or implied, including, but not limited to, implied warranties of merchantability, non-infringement and suitability for a particular purpose. Illumint does not warrant that the information will be free from error. None of the information provided on this website is intended as investment, tax, accounting or legal advice, as an offer or solicitation of an offer to buy or sell, or as an endorsement of any company, security, fund, or other securities or non-securities offering. The information should not be relied upon for purposes of transacting securities or other investments. Your use of the information is at your sole risk. Under no circumstances shall Illumint be liable for any direct, indirect, special or consequential damages that result from the use of, or the inability to use, the materials in this site, even if Illumint or a Illumint authorized representative has been advised of the possibility of such damages. In no event shall Illumint have any liability to you for damages, losses and causes of action for accessing this site. Information on this website should not be considered a solicitation to buy, an offer to sell, or a recommendation of any security in any jurisdiction where such offer, solicitation, or recommendation would be unlawful or unauthorized.
Views: 43 Kevin Mahoney, CFP
Retirement Savings: 403(b) Plans for Teachers
 
02:14
401(k) plans get all of the attention, which leaves teachers & certain non-profit workers vulnerable to the shortcomings that accompany some 403(b) plans. Kevin Mahoney is the founder & CEO of Illumint, which offers virtual financial guidance specifically for the millennial generation. For more info, check out illumintadvisors.com. You also can connect with Kevin on: INSTAGRAM http://instagram.com/illumint FACEBOOK https://www.facebook.com/illumintadvi... TWITTER https://twitter.com/illumintCEO YOUTUBE http://www.youtube.com/illumint Video Transcript: 401(k) plans so dominate our national conversation about retirement savings that, if you’re a teacher or non-profit employee with a 403(b) plan, you’re probably wondering why you don’t get any love. So let’s take a few minutes to review how 403(b) plans differ from that other retirement plan. The reasons for participating in a 403(b) plan are pretty similar to a 401(k). For example, you get tax-deferred investment growth and you may get a matching contribution from your employer. So why do 403(b) plans even exist? The IRS actually approved them a few decades before 401(k)s started, as a supplemental pension option for teachers. At the outset, though, the only permissible investment for teachers was an annuity, a relatively complex financial product that promises a certain return, but carries high investment fees and, later, a surrender fee if you try to sell the annuity. In addition, unlike with 401(k) plans, federal retirement-plan rules don’t cover many 403(b) plans. As a result, 403(b) plan oversight can be pretty weak. And you almost certainly can’t count on your employer to protect you from unscrupulous plan providers and unsuitable investments -- even among options that your employer has approved. So what can you do? -- Approach your plan provider with some healthy skepticism, especially if they’re offering you perks like free meals -- Make sure you at least get any matching contribution that your employer offers, but then consider saving for retirement in a different account, like an IRA. -- And if you’re feeling confused or potentially exploited, voice your concerns to colleagues and press your employer to improve the plan. Required Disclosure: The information on this site is provided “as is” and without warranties of any kind either express or implied. To the fullest extent permissible pursuant to applicable laws, Illumint disclaims all warranties, express or implied, including, but not limited to, implied warranties of merchantability, non-infringement and suitability for a particular purpose. Illumint does not warrant that the information will be free from error. None of the information provided on this website is intended as investment, tax, accounting or legal advice, as an offer or solicitation of an offer to buy or sell, or as an endorsement of any company, security, fund, or other securities or non-securities offering. The information should not be relied upon for purposes of transacting securities or other investments. Your use of the information is at your sole risk. Under no circumstances shall Illumint be liable for any direct, indirect, special or consequential damages that result from the use of, or the inability to use, the materials in this site, even if Illumint or a Illumint authorized representative has been advised of the possibility of such damages. In no event shall Illumint have any liability to you for damages, losses and causes of action for accessing this site. Information on this website should not be considered a solicitation to buy, an offer to sell, or a recommendation of any security in any jurisdiction where such offer, solicitation, or recommendation would be unlawful or unauthorized.
Views: 23 Kevin Mahoney, CFP
Compensation: Employee Stock Purchase Plan (Part 3 of 3)
 
02:23
An employee stock purchase plan (ESPP) may sound risky or complicated, but if handled correctly, it can just be extra money for you.
Debt: Credit Card Interest Rates
 
02:41
Credit card interest rates are steep, which is why advisors harp on paying your balance in full each month. You may have more options than you think when your balance starts to look unmanageable. Kevin Mahoney, CFP®, is the founder & CEO of Illumint, which offers virtual financial planning specifically for the millennial generation. For more on his work with student loans, 529 plans, buying a house, & more, check out illumintadvisors.com. You also can connect with Kevin on: INSTAGRAM http://instagram.com/illumint FACEBOOK https://www.facebook.com/illumintadvi... TWITTER https://twitter.com/illumintCEO YOUTUBE http://www.youtube.com/illumint Video Transcript: I’m Kevin Mahoney, the founder of Illumint, and I’m at D.C.’s Union Market today talking about credit cards. Credit cards can be a good idea for many reasons: convenience, security, and helping your credit score, to name a few. But they’ve become so easy to use -- just think of Amazon’s “Buy Now” button -- that your balance can quickly outpace your cash if you’re not watching closely. Credit card interest rates are steep, which is why advisors harp on paying your balance in full each month. Credit card companies love to imply when you log into your account that you’re doing well when you make the “minimum payment.” In reality, though, you become the companies’ favorite customer: someone who makes interest payments for years before eliminating your balance. You may have more options than you think when your balance starts to look unmanageable. To start, call your credit card company and simply request a lower interest rate. These companies typically don’t want to lose your business to a competitor, so a confident proposal can work as well as when you call Comcast about your exorbitant cable bill. Next, if you hold balances on multiple credit cards, consider paying off your smallest balance first. Please note: this defies rational thinking, which says you should prioritize the debt with the highest interest rate to minimize your overall costs. Yet, research has shown that a “small win” can create the psychological momentum needed to also conquer your more daunting balances. Once a card’s balance reaches zero, you’ll typically want to keep the account open to help your credit score, but you’re probably best off removing that number as a payment option in your online accounts. Finally, you may want to transfer one or more credit card balances to a new credit card that offers an interest-free period. This strategy creates an opportunity -- for as long as 21 months! -- to systematically pay down your balance without incurring additional interest charges. You just need to make sure you have a plan to eliminate the balance before the interest rate jumps back up. As with student debt, credit card balances that you can’t immediately pay off can feel like a major impediment to your goals. Even if the process will take some time, you first need to do what you can to untangle yourself from the credit card companies’ vicious interest rate cycle. Required Disclosure: The information on this site is provided “as is” and without warranties of any kind either express or implied. To the fullest extent permissible pursuant to applicable laws, Illumint disclaims all warranties, express or implied, including, but not limited to, implied warranties of merchantability, non-infringement and suitability for a particular purpose. Illumint does not warrant that the information will be free from error. None of the information provided on this website is intended as investment, tax, accounting or legal advice, as an offer or solicitation of an offer to buy or sell, or as an endorsement of any company, security, fund, or other securities or non-securities offering. The information should not be relied upon for purposes of transacting securities or other investments. Your use of the information is at your sole risk. Under no circumstances shall Illumint be liable for any direct, indirect, special or consequential damages that result from the use of, or the inability to use, the materials in this site, even if Illumint or a Illumint authorized representative has been advised of the possibility of such damages. In no event shall Illumint have any liability to you for damages, losses and causes of action for accessing this site. Information on this website should not be considered a solicitation to buy, an offer to sell, or a recommendation of any security in any jurisdiction where such offer, solicitation, or recommendation would be unlawful or unauthorized.
Views: 13 Kevin Mahoney, CFP
Compensation: Stock Options
 
02:25
Congrats on that new job offer! Here's what you may want to consider if you're set to receive company equity. Kevin Mahoney is the founder & CEO of Illumint, which offers virtual, fee-only financial guidance for millennial parents. For more info, check out illumintadvisors.com. You also can connect with Kevin on: FACEBOOK https://www.facebook.com/illumintadvisors TWITTER https://twitter.com/illumintCEO INSTAGRAM http://instagram.com/illumint YOUTUBE http://www.youtube.com/illumint Video Transcript Hey everyone! I’m Kevin Mahoney, the founder of Illumint, and I’m outside the WeWork space in D.C.’s Shaw neighborhood to talk a little bit about company stock options. Earlier this week, I reviewed another form of equity, RSUs, which typically don’t involve quite the same complexity as stock options. Unlike the “promise” of RSUs, stock options give you a right to buy company shares at a price and time that your employer sets -- this ISN’T an automatic acquisition. Stock options require you to make a purchase… with your own money. What else about stock options differs from RSUs? Well, you may still be able to exercise your stock options for some period of time if you leave your company, which could remove a barrier to job mobility that RSUs create. If your stock option is an “incentive” stock option (or ISO), you may not owe taxes immediately. For the other type of stock option, a non-qualified stock option, that won’t be the case -- taxes will be due upon exercise. You can see how this decision-making process starts to become complex and stressful. For people who are just convinced that their company will become as valuable as Amazon, thoughts of getting wildly rich off stock options begin to cloud their thinking. Yet, even rational folks are still stuck trying to evaluate their company’s future prospects, and whether their stock options represent a good deal. And almost everyone tends to tense up staring at the legal documents that outline your stock option terms. Stock options may feel particularly perplexing to buy-and-hold investors who prefer index mutual funds or ETFs. In this case, your company essentially is offering you an opportunity to gamble, which directly conflicts with your typical approach to investing. You would be putting your own money in a single company stock, with no assurance that the company will survive, let alone grow substantially in value. But what if the company does succeed? Fair enough -- it’s an exciting possibility, and you’re in some position (however minor) to play a role in that success. For this reason, I wouldn’t often suggest that people forego their stock options entirely. Instead, consider excising a portion of your options, based on how much of your savings you’re able and willing to lose.
Views: 21 Kevin Mahoney, CFP
Housing: Amazon HQ2’s Impact on D.C.
 
02:37
Unless you want to live right around “National Landing,” Amazon probably isn’t the reason why your rent is so damn high
Views: 10 Kevin Mahoney, CFP
Compensation: After-Tax 401(k) Contributions (Part 2 of 3)
 
02:02
How do after-tax 401(k) contributions differ from the pre-tax contributions and company match that you may be used to?
Housing: Financing Repairs & Renovations
 
02:42
The best part of a home improvement project often is the part when the contractors finally leave. The cost isn't far behind, though, which makes understanding your financing options that much more valuable. Kevin Mahoney, CFP®, is the founder & CEO of Illumint, which offers virtual financial planning specifically for the millennial generation. For more on his work with student loans, 529 plans, buying a house, & more, check out illumintadvisors.com. You also can connect with Kevin on: INSTAGRAM http://instagram.com/illumint FACEBOOK https://www.facebook.com/illumintadvisors TWITTER https://twitter.com/illumintCEO YOUTUBE http://www.youtube.com/illumint Video Transcript: Hi, I’m Kevin Mahoney, the founder of Illumint. I’m in D.C.’s Georgetown neighborhood today thinking about how you might want to cover the cost of a major home improvement project. Let’s assume that you’re remodeling a kitchen or replacing your roof, both of which likely require more money than you have available in a savings account. If the cost isn’t too high, though -- let’s say under $12,000 -- you might first consider a new credit card that offers an extended interest-free period. In this case, make sure you have a clear path to paying off the debt before the credit card terms become unfavorable for you. When a project will run you much more, though, you’re probably looking at an unsecured personal loan, home equity loan, or home equity line of credit. You typically can obtain a personal loan pretty quickly, but you’ll probably get a higher interest rate than with a home equity loan. A personal loan may be a good choice, though, if you don’t have much equity in your home or can find a good offer from a credit union or alternative lending source. Now let’s assume you have more than 25% equity in your home, and you want to avoid refinancing your mortgage. A home equity loan essentially functions as a second mortgage that provides you with lump sum funding at a fixed interest rate. As with your first mortgage, the loan may include closing costs and fees, but you also may be able to deduct the interest that you pay. With a line of credit -- as with your credit card -- you’ll typically get revolving access to funds. You only pay interest when you borrow, not on the entire line of credit. And the initial interest rate also may be lower than on a home equity loan, but in exchange, you’ll get a variable rate that can generate higher monthly payments in a rising rate environment. You can draw on the line of credit for 10-15 years, and then you begin to repay the principal borrowed over the next 15 years. Clearly, there are a lot of factors at play here. Start with this: meet with several contractors, and try to lock down the project cost and timeline. Then also evaluate your risk tolerance: are you comfortable leveraging your home equity? And are you willing to bet on interest rate movements? The answers to these questions may make your decision more straight forward than you anticipated. Required Disclosure: The information on this site is provided “as is” and without warranties of any kind either express or implied. To the fullest extent permissible pursuant to applicable laws, Illumint disclaims all warranties, express or implied, including, but not limited to, implied warranties of merchantability, non-infringement and suitability for a particular purpose. Illumint does not warrant that the information will be free from error. None of the information provided on this website is intended as investment, tax, accounting or legal advice, as an offer or solicitation of an offer to buy or sell, or as an endorsement of any company, security, fund, or other securities or non-securities offering. The information should not be relied upon for purposes of transacting securities or other investments. Your use of the information is at your sole risk. Under no circumstances shall Illumint be liable for any direct, indirect, special or consequential damages that result from the use of, or the inability to use, the materials in this site, even if Illumint or a Illumint authorized representative has been advised of the possibility of such damages. In no event shall Illumint have any liability to you for damages, losses and causes of action for accessing this site. Information on this website should not be considered a solicitation to buy, an offer to sell, or a recommendation of any security in any jurisdiction where such offer, solicitation, or recommendation would be unlawful or unauthorized.
Compensation: 401(k) Rollover Considerations (Part 1 of 3)
 
02:03
What factors might you want to consider when you have the option to roll over your funds to a new company plan, roll over your funds to an IRA, or take a cash distribution?
Taxes: Married Filing Status
 
01:56
If you’re recently engaged, wedding planning probably takes up enough of your time and energy. But with the end of the year nearly upon us, you still may want to add this tax-related consideration to your list. Kevin Mahoney, CFP®, is the founder & CEO of Illumint, which offers virtual financial planning specifically for the millennial generation. For more on his work with student loans, 529 plans, buying a house, & more, check out illumintadvisors.com. You also can connect with Kevin on: INSTAGRAM http://instagram.com/illumint FACEBOOK https://www.facebook.com/illumintadvisors TWITTER https://twitter.com/illumintCEO YOUTUBE http://www.youtube.com/illumint Video Transcript: I’m Kevin Mahoney, the founder of Illumint. The IRS evaluates our potential tax filing status as of December 31 each year. So no matter the month in which you get married, you can only choose between “married filing jointly” or “married filing separately” for that year. About 95% of couples in the U.S. use the “married filing jointly” status when filing their taxes. Generally, married filing jointly provides the most beneficial tax outcome for couples. This is most often true when the couples’ incomes are unequal. When you report two individuals’ income to the IRS as a WHOLE, the spouse with the higher income may fall into a lower tax bracket than if he or she filed separately. Given this dynamic, if you’ve scheduled your wedding for 2019, you may want to see if you can reduce or shift any year-end income until next year. For example, you might: Request that your company postpone a work bonus for a few months Hold off on exercising any incentive stock options at your company Accelerate any contributions that you planned to make to your retirement accounts If you own a business, temporarily hold off on sending out invoices Ultimately, though, you’ll need to run your financial data through some tax prep software under both scenarios to determine which filing status and income strategy works best for your family. Required Disclosure: The information on this site is provided “as is” and without warranties of any kind either express or implied. To the fullest extent permissible pursuant to applicable laws, Illumint disclaims all warranties, express or implied, including, but not limited to, implied warranties of merchantability, non-infringement and suitability for a particular purpose. Illumint does not warrant that the information will be free from error. None of the information provided on this website is intended as investment, tax, accounting or legal advice, as an offer or solicitation of an offer to buy or sell, or as an endorsement of any company, security, fund, or other securities or non-securities offering. The information should not be relied upon for purposes of transacting securities or other investments. Your use of the information is at your sole risk. Under no circumstances shall Illumint be liable for any direct, indirect, special or consequential damages that result from the use of, or the inability to use, the materials in this site, even if Illumint or a Illumint authorized representative has been advised of the possibility of such damages. In no event shall Illumint have any liability to you for damages, losses and causes of action for accessing this site. Information on this website should not be considered a solicitation to buy, an offer to sell, or a recommendation of any security in any jurisdiction where such offer, solicitation, or recommendation would be unlawful or unauthorized.

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