Financial Pathway Advisors, LLC
James Kinney is the founder and owner of Financial Pathway Advisors of Bridgewater New Jersey. Financial Pathways also has offices in Flanders and Cranbury New Jersey.
Jim is a Certified Financial Planner and a NAPFA registered fee only financial advisor. Fee only advisors are committed to maintaining a compensation model that eliminates the potential conflicts of interest which may result when parties other than the client are paying for advice. Fee only advisors are not permitted to accept commissions, referral payments, or any other form of compensation from investment firms, insurance companies, or other professionals.
Jim is a strong believer in the power of financial planning, when done with the clients’ best interests in mind, to improve lives, reduce stress, and achieve goals. Both Jim and Luba have analytical backgrounds (both have spent time working in IT, as well as business and finance), which are demonstrated in the care and attention they pay to even the smallest detail in their clients’ financial plans.
In addition to retirement planning and investing, Jim has specialized training in planning for college, while his partner, Luba, is a Certified Divorce Financial Planning Specialist.
Jim believes that investment risk management should be at the core of every financial plan. Again, his analytical approach is on display as the firm carefully creates, for each client, portfolios that are optimally diversified to balance investment risk vs. the need for positive returns. There are no cookie cutter investment solutions at Financial Pathways. Each client’s investment recommendations are unique and based on his or her carefully considered financial plan.
Jim lives in Hillsborough New Jersey with his wife Laura. They have four adult and college age children. Jim earned his bachelors degree in Business Administration from Drexel University in 1984, his MBA from Fairleigh Dickinson University in 1990. Prior to beginning his current career, Jim had been a successful entrepreneur, founding and growing a successful international manufacturing and data management company from 1990 to 2003. He started his financial planning career in 2004, founded Financial Pathways in 2007, and earned his CFP® certification in 2008. Luba Globerman joined his practice in 2009. Jim is a member of the Financial Planning Association (FPA) as well as the National Association of Personal Financial Advisors (NAPFA). He has been an active adult leader in the Boy Scouts of America for 18 years, and enjoys camping, hiking, fishing, running and the outdoors.
BS, Business Administration, Drexel University
MBA, Fairleigh Dickenson University
Financial Pathway Advisors is a Registered Investment Advisor in the State of New Jersey. Advisory services are offered only to residents of the State of New Jersey, except as permitted by applicable state and federal securities regulations.
I would advise not to sell anything or make any moves whatsoever without consulting a local accountant. You may have state as well as federal taxes and filings to take care of. Don't try to do it on your own, or with the advice gathered online which may not be familiar with the details of your particular situation.
My advice would be to hire a professional advisor, probably a CPA with experience dealing with expatriate issues (even though she is a US citizen, understanding the issues involved in owning overseas assets would be handy). This isn't something I would try to fully understand on my own. Cost of error is too high.
I will start by saying I am not an expert in this field. First, as an ex-pat US citizen, you will still need to file taxes in the US and report income. Taxes you pay in Germany will typically be credited against you US liability, so you may not owe anything - but you still have to report income and file a return. Since you will be earning income, you likely still qualify to make Roth contributions. (not sure if someone expert in this area can confirm).
As for as German pension plans - be careful here! What happens after 8 years? Can you take your balance with you? What will be tax consequence? i doubt there is an ability to rollover to a US instrument such as an IRA. I would search out a CPA or CFP who specializes in working wuth expatriates and inquire as to this question. Be very careful before putting money into the German pension plans until you know the answer to what happens if you leave the company, or move back here.
You say you have an investment advisor, but you are looking for advice from strangers on this site. Do you not trust the advice your advisor is offering? He should be the individual who knows all about your life, your needs, your risk tolerance, income, etc. - and is thus in the best position to give advice. If you don't trust the advice, because you suspect he has something other than your best interest in mind, then you probably need to find another advisor.
A fixed annuity can be a safe, low return substitute for bonds in a portfolio. Interest can also be tax deferred until you make withdrawals, so for money in a taxable account, they can make sense as a safe alternative to stocks. Other alternatives would include CD's, treasury bonds, and other fixed income instruments. As to whether or not this is the best product for you, I simply don't know enough about the annuity, your specific cash flow needs, your other investments, or what you are trying to accomplish. I suggest you review all this with your advisor, or find a new investment advisor - preferrably one who works directly for you for a fee (rather than selling products).
As a working student, I am going to presume you are still fairly young, and thus have time to save for retirement in fhe future.
In order of preference.
1. Use your existing funds to pay the bill (Roth contributions can be withdrawn tax free, but not earnings unless you are over 59.5 - so be sure you are ONLY withdrawing money you contributed to the plan). Generally speaking, I would not recommend making contributions to a retirement account until you are past living paycheck to paycheck and have sufficient savings in place to handle upcoming expenses and unforeseen emergencies (3-6 months worth of expenses in a savings account).
2. Use the IRS payment plan. This is not free, there are interest charges attached, so it is just another form of borrowed money, but likely less expensive than any you can obtain on your own.
3. Credit. Prefer not to go here, unless you can manage a very low interest rate and pay it off quickly.
Next take a good hard look at how you got into this situation, and where your financial life goes from here. Perhaps enlist the help of a financial planner as a "financial coach" to help guide you and consider options moving forward. There are a growing number of financial planners who work for an hourly fee who can meet with you for a reasonable fee and help you stay on sound financial footing. You can seek one at www.napfa.org.