Deborah Meyer is a perceptive problem-solver. She is passionate about client service and enjoys being a trusted advisor families. Deb is a proud member of: XY Planning Network, NAPFA, AICPA, and Ellevate Network. She enjoys giving back to the community, serving as a CFP Board Women's Initiative advocate and mentor.
Professionally, Deb's career began in public accounting at big 4 firm Deloitte. She specialized in tax compliance and consulting for individuals, closely held businesses, trusts, and estates. Thereafter, Deb worked for nearly seven years at Matter Family Office in Clayton, Missouri. Her role incorporated a broad range of services for families of significant wealth, including Quickbooks Online reporting, income tax coordination, retirement plan guidance, investment management, charitable giving strategies, estate planning, insurance evaluation, and family education.
Soon after resigning from Matter Family Office, Deb launched SV CPA Services (aka Statera Vitae LLC) in 2014. Following her passion to help faith-filled families build wealth, Deb launched WorthyNest in late 2016.
BSBA, Accounting, Saint Louis University
Congratulations on starting your company!
I think you need to clarify some important questions: Why is this person offering to invest in your company? Are they looking for "passive" investment or more active ownership in the company? Why did he or she choose your start-up in particular?
Valuations are standard protocol for established companies looking to restructure ownership. But start-ups with no track record have no easy way of determining the equity percentage. You may want to consider delaying any equity ownership discussions until your company is more established. In the meantime, personal capital and business debt may be easier ways to grow your company. Here's a link to my recent blog post called "Financing Your Way to Business Growth." I hope it is helpful.
What a great way to start saving for your son's education! There are two separate guidelines for 529 plan contributions and gift tax rules. Gift tax regulation allows you to gift $14K to a single beneficiary, and your wife can gift $14K to a single beneficiary. Combined, the two of you can gift up to $28K to your son in 2016.
If you plan to superfund the 529 plan now for the next 5 years, file a gift tax return to start a paper trail. You and your wife collectively could contribute up to $140,000 ($70K each) in 2016, but you wouldn't be allowed to make any further 529 plan contributions to this 529 account until 2021. Furthermore, you cannot make any other gifts to your son from 2017 to 2020 unless you are willing to eat into the lifetime gift exemption.
Each state has its own guidelines on the maximum 529 account value. Some states are as low as $235K maximum account value, so read the fine print. Another consideration? Certain states allow state income tax deductions for in-state 529 plan contributions. If you superfund and your state provides a tax break, you could forego the state tax deduction in 2017, 2018, 2019, and 2020.
Also, your investment allocation is important. If you choose an age-based fund, your six-year-old son's account will be heavily invested in equities for the next 4 years. Common practice is for any new contribution to be 100% invested. So if instead, you and your wife fund $28K each year for the next 5 years, you can put fresh cash to work in each of the tax years. If the stock market declines within the next few years, you'll have a smaller setback with this strategy.
Hope this is helpful! Please feel free to contact me with any follow-up questions. Visit my website, www.worthynest.com, or email me at firstname.lastname@example.org.
Deb Meyer, CPA, CFP(R)
Robo-Advisors leverage technology to manage investment assets. Comprehensive financial planners look at the integration of your goals and values with investment objectives. We: help you save for the future, evaluate insurance policies and provide introductions to outside professionals as needed, and act as an accountability partner. We add the human element that a robo-advisor simply doesn't have available.
Some newer solutions attempt to marry the high-tech feel of a robo with the high-touch feel of a human advisor. However, many of their professionals are relatively new to the financial planning space, and they typically serve more clients. Naturally, an advisor working with 100 families cannot give as much personal attention to clients as an advisor serving 60 client families.
Ultimately, the choice is yours. You must decide what level of human interaction you want when it comes to achieving long-term financials goals.
I'm very sorry to hear about your diagnosis. My heart goes out to you and your family. Below are a couple of practical suggestions to deal with the financial repercussions of this diagnosis. My first suggestion is applicable to any adult (life- threatening illness or not):
1. Get your financial house in order. Consult an estate attorney if you do not have basic documents like a Will or Powers of Attorney for financial and healthcare matters. Estate documents more than 7-10 years old should be updated, too. Powers of Attorney are relevant during your lifetime, if you are physically or mentally disabled. Wills provide important instructions to heirs upon death, specifying division of assets and naming guardians of minor children. Retirement accounts like IRAs and 401(k)s will be distributed according to the beneficiary designation of the account. Review those designations to ensure they accurately reflect your intentions.
2. Hire a Certified Financial PlannerTM Professional to guide you through the financial planning process. One who has special knowledge in taxes (such as a CPA) is even better. In your specific case, you may want a planner who can build rapport with your 29 and 26 year old children, in the event your disease turns life-threatening quickly. Inheritance, or sudden money, comes with its own set of challenges. Your children will need a trusted confidante and advisor to help them through this emotional process.
3. Be open with your children. If you have a hard time verbally expressing your feelings, consider writing a letter. The letter will not only memorialize your current thoughts and wishes, but will also serve as a loving reminder of the care and thought you put into this process.
I think anyone can benefit from the saying "Live each day as if it's your last." We never know when our time is up. Living authentically and intentionally provides purpose and direction.
All the best,
Could you elaborate on your intention behind the gifting and your relation to the minor? Although you technically can use the IRA to make gifts, I wouldn't recommend it. If you are over 70 1/2 years old and already taking IRA distributions, make sure the distribution goes into your taxable account first. Then if you insist on making a gift, transfer it from your personal, taxable account to the child's account.
Gift tax rules allow you to make a gift up to $14,000 per donee (beneficiary) in 2016. If you are married, your spouse could also gift $14,000 to the same donee in 2016. If the child is in private school or has excessive medical bills, you can pay the school or medical institution directly to avoid the $14K gift tax limitation.
If you are a parent of the minor and under age 59 1/2, withdrawing money from the IRA has serious income tax implications -- in the form of early withdrawal penalties. If your goal is to save for college, continue funding your retirement accounts since they cannot be included in the FAFSA calculation.
Still insistent on gifting something to the minor? Consider funding a 529 plan to save for college rather than a taxable account in the child's name. Children under the age of 17 are subject to kiddie-tax rules where unearned investment income could be taxed at the parent's higher tax rate.
Hope this helps! Please feel free to reach out with follow up questions. My company website is www.worthynest.com.
- Deb Meyer, CPA, CFP(R)