Plan your investment moves for the new year |

Plan your investment moves for the new year

Charlie Wick

Each New Year, most of us vow to improve in one aspect or another of our lives. However, we don’t always rush into carrying out our resolutions. But if you’ve promised yourself that “this is the year” that you’re really going to stay on top of your financial and investment situations, you’ll want to get started now. Start by reviewing your family and career circumstances. Will there be any significant changes in your life in 2005? If so, they almost certainly will have an impact on how you save and invest. Consider these types of factors: – New child – If you’ve recently added a child to your family, or you’re going to add one in 2005, you have a lot to be happy about. And you also have a lot to protect. So, make sure that you have enough life insurance to help raise and educate your child, should something happen to you. Also, it’s never too soon to set up a college fund for a child, so you might want to open a Section 529 plan or a Coverdell Education Savings Account. – Child heading to college – If your child is heading off to college next fall, it’s time to put your college-funding strategies in high gear. Now that it’s past Jan. 1, you can complete the Free Application for Federal Student Aid (FAFSA) at Also, you may want to shift some assets from your child’s name to yours; colleges typically expect students to contribute 35 percent of the their money toward college expenses – but you are only required to kick in around 5.6 percent. And you’ll want to contribute as much as you can to whatever investments you’ve designated for college. – Salary increase – Are you getting a raise this year? If so, try to invest at least part of it. For example, you may want to increase your contributions to your IRA or 401(k). Both these retirement-savings vehicles offer tax advantages and a range of investment options. Furthermore, both have higher contribution limits in 2005, so, even if you “maxed out” last year, you can put in more this year. – Retirement – If you’re planning to retire in 2005, you have many issues to consider. You may need to take distributions from your employer-sponsored retirement plan or your IRA. You might also have to decide whether or not you should begin accepting Social Security. And you’ll want to ensure that your investment portfolio is properly balanced for your retirement years. Keep in mind that you may enjoy a healthy, active retirement for two or three decades, so you’ll still need your investments to provide you with growth opportunities, as well as current income. Your investment and tax advisors can help you determine the best moves to make as you enter retirement. Start the year off rightGet 2005 off to a good start by making sure your financial plans fit your life. It may be the most important New Year’s resolution you make – and it’s one you’ll want to keep. Charlie Wick is an investment representative with Edward Jones in Eagle. He can be reached at (970) 328-4959.Vail, Colorado

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