Blueprint Financial Planning LLC
Vicki Fillet began her investment career with The First Boston Corporation and later joined Furman Selz becoming a Managing Director. After her Wall Street experience, she became a consultant for Republic Bank where she worked on the development and feasibility of several investment products for the individual. While living in Canada she led the volunteer fundraising activities for the community hospital. Returning to New Jersey, she consulted with Ryan Beck & Co. on product development, before co-founding Value Architects.
As Value Architects Asset Management took off, she and her business partner, Rick Konrad, established Blueprint Financial Planning to focus on the financial planning needs of clients. Vicki is committed to helping her clients manage their money more effectively by teaching them the necessary information to take control of their finances. As she likes to say, "the more you know, the more you will be able to manage your money effectively and make it work for you."
Vicki is a graduate of Fordham University with a BA in economics and business. She received her Certificate in Financial Planning from New York University, and her CFP® designation in 2006. She is currently Chairman of the Financial Planning Association of New York. She is also a member of the Financial Women’s Association where she is on the Advisory Council for its Financial Backpack program, providing financial literacy education to high school students.
BA, Economics and Business, Fordham University
I am guessing that your day trading is not in a tax deferred account, but in an investment account.
Therefore, any profits will be treated as long term or short term capital gains.
Capital gains and losses are classified as long term if the asset was held for more than one year, and short term if held for a year or less. Taxpayers in the 10 and 15 percent tax brackets pay no tax on long-term gains on most assets; taxpayers in the 25-, 28-, 33-, or 35- percent income tax brackets face a 15 percent rate on long-term capital gains. For those in the top 39.6 percent bracket for ordinary income, the rate is 20 percent. Short-term capital gains are taxed at the same rate as ordinary income. There also is a 3.8 percent tax on net investment income for single taxpayers with modified adjusted gross income above $200,000 ($250,000 for married couples filing jointly). Note, too, that capital gains, in some cases, face an effective tax rates above the 23.8 percent statutory rate because of phaseouts in the tax code.
I hope that helps!
Does the rent on the property cover the mortgage payments? Is there any left over?
I do not know your age so I cannot fully answer this question, but paying a 10% penalty to pay off a mortgage with a low interest rate is ot a good idea. In addition to the penalty, you will have to pay taxes on this money also.
Put the money in an IRA and allow it to grow tax deferred until retirement.
If there is extra cash flow from the rental, make extra payments on the house to shorten the maturity on the mortgage.
As long as the payment of the mortgage is not a financial hardship, there is not reason to use retirement monies to pay it down.
The earnings limit in 2016 is $15,720. Above that amount they will deduct
- We use the following earnings limits to reduce your benefits: If you are under full retirement age for the entire year, we deduct $1 from your benefit payments for every $2 you earn above the annual limit.
- In the year you reach full retirement age, we deduct $1 in benefits for every $3 you earn above a different limit, but we only count earnings before the month you reach your full retirement age.
- (from SS website)
If you are making more than these numbers and can afford to wait to get social security benefits, it would be in your best interest.
The earnings limit will disappear after your 65th birthday. Income above $34,000 for a single filer will cause 85% of your social security to be taxes also.
Yay for you! Starting investing early is the answer to a comfortable financial future.
You need to consider a few things:
Do you have a date for moving out on your own?
What would be your expected rent and expenses?
You should put it aside in a cash or cash equivalent account enough savings for living about 3 - 6 months on your own.
You should then invest the maximum in a Roth IRA, since those monies grow tax-free and not just tax deferred.
There are many retails brokers like TD Ameritrade and Schwab who offer no commission options for investment.
Unless you want to do the homework necessary to invest away from the indexes, they are your best choice.
At your age, you should be savings between 10-12% of your gross income for the future.
Keep up the good work!
If the question you are asking is, do I take these funds in a lump sum or monthly distributions, that will depend on two things. What are the company plan rules and do you need the money? Sounds like you do not need the money now. If that is so and you can take a lump sum payment, you will have the ability to invest those monies for your retirement.
If you feel more comfortable taking monthly distributions do that, then you may be able to contribute more monies to your own retirement plan and grow that money tax deferred until retirement at 70 years old.
You should contact a CFP planner to help with this decision. It is an important one!