August 2015

Cash Safety Cushions (or “Rainy Day” funds)

Here’s a recent question I received via email. This one of those “simple” questions that needs a long winded answer Q: How much of a safety cushion do you recommend having, and where do you suggest to keep it? A: Let’s take a deeper look into safety cushions and try to define an acceptable answer. Rule of Thumb vs. your personal reality: It’s always good to have a point of comparison between the correct answer and the not-so-correct answer. Many of my readers may have come across a “rule of thumb” safety cushion ballpark which is somewhere between 3 to 6 months of living expenses. So, for example, if your monthly living expenses are $5,000 per month, 3 to 6 months of expenses would require $15,000 – $30,000 of a safety cushion. Why is the rule of thumb wrong? I’m not sure who formulated this rule of thumb but I... View More

March 2015

Diversify your income!

I know what your thinking:  “Is there really gonna be another shutdown?” Seems like there are always rumors of “potential” government shutdowns or agency specific furloughs.  If that happens, affected employees will enter non-pay status, which can impact accrual of leave hours, future Social Security benefits, and – if the shutdown lasts REALLY long – can affect Federal Pensions. But the loss or reduction of future benefits is likely overshadowed by the immediate loss of pay.  For many, their Federal job is their only source of income! It is for this reason that I write this article.  We all have heard the old adage “don’t put all your eggs in one basket.”  This concept is applied in any area that carries risk of loss.  In finance we apply this principle in multiple areas – we just call it “diversification.”  We diversify our investments, we diversify our exposure to taxation (ie. Roth... View More

March 2015

Revocable Trusts

Here is an important read for individuals looking to plan their estate. Read on and let me know your thoughts in the comments. Revocable Trusts:  What they do and what they don’t do. So, you’re collecting your thoughts about what’s going to happen to all your stuff when you pass away.  You want things to pass as smoothly as possible with as little expense as possible.  You have a will, but you’re not sure if that’s enough. Then you hear about another popular Estate Planning document – the Revocable Trust.  What do revocable trusts do?  And can one be used in place of a will? What is a Revocable Trust? A trust is a legal agreement between a grantor and a trustee, where the trustee agrees to manage the holdings of the trust according to the written provisions of the grantor.  If the provisions of the trust can be altered, then it... View More

March 2015

Welcome, Welcome!

I am so excited to be entering this new space! The world wide web has always been something of a wonder to me and much more of a resource rather than a social outlet. With this new beginning I hope to bring updated and interesting information to past, present, and future clients. So go ahead and bookmark www.StephenZelcer.com for regular posts about financial planning for federal employees. Feel free to leave a comment below and let me know know what you would like to read about in this blog. All the best, Stephen Zelcer

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