Polero ICE Advisers
Kimerly Polak Guerrero has several decades of experience as a portfolio manager and a personal financial-life manager. She is a Registered Investment Adviser and a CERTIFIED FINANCIAL PLANNER™. She started Polero ICE Advisers in 2008 to provide women and couples with an alternative to the many financial firms that bombard their target customers with glitzy advertising campaigns. Instead of receiving advice from a high-pressured salesperson, Kim's clients get a fee-only adviser who serves as their fiduciary at all times. As a fee-only adviser, she is only compensated by her clients, in a completely transparent manner.
Kimerly has a Masters in Business Administration from Harvard Business School and a Bachelor of Science in Finance and Insurance from the University of Rhode Island, where she graduated summa cum laude. Kim has also earned the Retirement Income Certified Professional® (RICP®) designation, and has completed the educational requirements for the designation of Accredited Estate Planner. She is a member of NAPFA (National Association of Personal Financial Advisors), and served as the leader of NAPFA's New York Study Group for 3 years.
When offering financial direction, Kimerly is able to make use of her extensive experience as a financial adviser and investment professional. As a portfolio manager and trader from 1986-2007, she was responsible for investing over $6 billion in the global markets, during many periods of excessive volatility. The lessons that she learned first-hand serve her well in assisting her clients today.
Kim is dedicated to providing pro-bono services to those in need of practical financial advice. She has worked with the VITA (Volunteer Income Tax Assistance) Program, which helps elderly and low-income individuals prepare their taxes, and has provided Financial Backpack classes to many groups of young people. Additionally, she continues to serve as a presenter for a financial-education Program for battered women in New York City, after being the Coordinator for this Program for several years.
MBA, Harvard Business School
The information provided is solely for informational purposes and does not constitute a client-advisor relationship, nor is it a solicitation to sell investment advisory services.
CFP® and CERTIFIED FINANCIAL PLANNER™ are marks owned by the Certified Financial Planner Board of Standards, Inc. These marks are awarded to individuals who successfully complete the CFP Boardʼs initial and ongoing certification requirements.
The majority of people who sell their primary residence, in which they have lived for at least 2 of the last 5 years, do not pay a capital gains tax on the sale. In addition to the $250,000 exclusion from capital gains per person (or possibly $500,000 for a couple), you can also subtract your full cost basis in the property from the sales price. Your cost basis is calculated by starting with the original purchase price you paid, and then adding the expenses you paid to make the purchase (e.g. attorney fees, the cost of title insurance, and any settlement fees). To this figure, you can add the cost of any additions and improvements that had a useful life of over 1 year, made while you owned the property. And then finally, you add your selling costs, such as the fees paid to a real estate broker and your attorney, as well as any transfer taxes that you may have to pay.
By the time you finish totaling all the costs of buying and selling and improving the property, your capital gain on the sale will likely be lower than the first back-of-the-envelope calculation that you made. And then subtracting the $250,000 exclusion from this gain figure often brings it below zero.
It's important to note, that for married couples, determining a break-even age for Social Security benefits can be quite a bit more complicated than for a single person. This is because a surviving spouse has the option of either continuing to receive the Social Security benefit he or she had been receiving, or to take the deceased spouse's higher benefit. Once the additional person comes into the equation, the potential longevity of both need to be taken into account. The Social Security analytic tools that are available to help determine optimal claiming strategies often note that in the case of a married couple, thousands of potential collection strategies have been looked at to determine the one that maximizes lifetime benefits. This is the case when only one lifespan is selected for each spouse. Once we start testing multiple longevities, the number of possibilities and optimal claiming strategies can increase significantly.
The paragraph above is basically trying to point out that the Social Security break-even calculation can be quit a bit more challenging than working out a few formulas, once you add a spouse into the equation. The higher of the 2 benefits being received by the couple, will be available until the end of the lifetime of the last spouse to survive, therefore making it a consideration worth factoring into the calculations.
You are still allowed to put money into a Traditional or Roth IRA each year, even if you are contributing to your employer's retirement plan. Even though your employer's Plan has "IRA" in its title, Simple IRA plans qualify as retirement plans, which means that you are free to put $5,500 into your Roth IRA (or $6,500 if you are 50 or older).
Since you are contributing to a Roth IRA, the tax deductibility issue is not relevant in your case. But if instead, you were putting your money into a Traditional IRA while participating in your employer's retirement plan, your tax deduction for your IRA contributions could be limited, depending on your income.
Although target funds are usually the easiest approach for those who want to be hands-off with respect to their investments, investing in them often comes at a high cost. Target funds are fund-of-fund structures, which means that an investor pays multiple management fees - one to the holding fund and then to the funds purchased by the holding fund. Most target funds have internal-fund management fees higher than 1.5% annually. It can be hard to see these fees, since they are not listed on your quarterly statements, but instead are deducted from the gross returns earned by the funds, before the investor sees his or her returns. Paying this high level of fees can take quite a bit out of an investor's retirement savings over several decades.
However, not all target funds are equally expensive. For example, Vanguard's target funds have a combined management fee (for the holding fund as well as the sub-funds) of under .4%. If your plan offers Vanguard Target Funds as an option, then choosing one of those would be a good choice. I would suggest that you choose the target fund with the date closest to when you think you will start taking distributions from the account, and not your retirement date from your current job. These funds become increasing conservative as the date in their title approaches, as well as thereafter. If you choose a 2030 target fund, there is a good chance that you would be significantly underweight in equities for your age, and would be giving up the potential for considerable growth in your retirement savings as a result.
Buying XYZ through the sale of a put can work out well, assuming the stock price moves down to or a little below the $25 strike price. If the stock stays above $25, you will not be "put" the stock, and would miss out on a big run up in the stock price. Your only earnings will be what you were paid as the option premium. If the stock price drops down to below $25, you will own the stock at a price equal to the $25 strike price minus the premium you earned. If the price falls well below the "$25-less-premium" level, you would have been better off not having sold the option, but instead purchasing the stock outright at that lower level.
The positive of selling puts is that you are sure to earn the premium. However, you cannot be sure that you will end up owning the stock. If its price is on an upward trajectory, with little volatility, the stock will get away from you. By selling the put, you might miss the upside, but will definitely participate in any significant downside.
If the stock price sits around the $30 level for a long time, you would have the opportunity to collect multiple put premiums, by selling a new $25-strike option each time the one you sold previously expires. In this way, you could earn a considerable amount of option premium, which would allow you to buy the stock outright in the market at the higher prevailing price, but effectively be purchasing it much lower, when the total earned premiums are subtracted from the price paid. This could be considered a way of backing into the lower-price you are hoping to pay. But of course, that strategy relies on a stable stock price for XYZ, since a big increase in the stock's value would likely cause the $25-strike put premiums to decline significantly, earning you very little when you sell them.