How did Greece’s finances get to be in such a predicament? In 2002, Greece changed their currency from the drachma to the euro, enabling borrowing to be done with greater ease. Along with that, the Greek government continued paying for high-profile projects, like the 2004 Athens Olympics. To make matters worse, public spending in Greece soared and public sector wages almost doubled in the past decade alone. Between their unwillingness to adjust their spending and with tax evasion being such a frequent occurrence, Greece is simply spending more than it is able to bring in.

In Greece, the retirement age may be 65, but average age of retirement is much lower due to the many questionable opportunities for early retirement. With the level of debt they hold and their citizens’ average lifespan being one of the highest in Europe, Greece cannot afford to be so generous in their retirement age. While it may seem unfair to U.S. citizens for our retirement age to rise from 65 to 67, hopefully this situation in Greece can help put this in perspective. Without a country adjusting their system to remain functional, the system will crumble. If the American age of retirement stays where it is, the U.S. may follow suit with Greece and cause not only our Social Security system to cease to exist, but potentially damage our economy along with it.

To begin, don’t worry- this does not need to be saved all at once. The best strategy is to set aside small amounts until you reach your goal, by either saving a percentage out of each paycheck or a set amount per month. Treat this as you would any other bill, and try to avoid missing making any payments.

When deciding the best way to save for emergencies, it is important to keep your funds liquid. That way, if an emergency situation does arise, you will be able to access your assets in time, and with as little fees if possible. Some options to keep your funds liquid are savings accounts, short term CDs, or even small cash reserves. While keeping your emergency savings liquid is vital, by no means do all of your savings or investments need to be this liquid.

Come by and see Scott today to start planning for your emergency fund.

Why exactly is having an emergency fund important? An emergency fund becomes a necessity in a wide array of situations. Imagine facing unexpected medical bills, major auto repairs or unemployment. Nowadays, many employers do not feel responsible for their employees’ wellbeing after a layoff. After being laid off, most people instead find themselves receiving less than enough to support themselves and their families, or entirely on their own.

Determining your monthly expenses is the first step in planning your emergency fund. Experts, like Scott Cline, recommend you have 3 to 6 months of your monthly fixed expenses saved in your fund. Scott recommends erring on the side of caution and keeping your funds closer to the 6 month amount. It cannot hurt to save a bit extra, if you have the resources to do so. When the time comes to make use of your funds, you will be glad you were prepared.

To create the most secure retirement plan, it’s best to have a diverse range of investments. A great way to begin this process is to first see what retirement savings program (ex. 401 (k) plan) your employer offers and find out all its details. These plans can be a great way to save; not only will your taxes be lower, but some employers will even match contributions to a certain percentage or amount. Stop in and see Scott to learn more about other saving options available.

When should you start planning for your retirement? Actually, the sooner you do the better off you’ll be. According to the U.S. Department of Labor, if you were to save $5,000 each year in a Roth IRA for only five years (and it earned 7% annually), you would accumulate $28,754. However, if you were to save that same $5,000 each year for 35 years, you would accumulate $691,184. An early start can really make a difference. A well-planned retirement can lead to a more comfortable lifestyle when the time comes.

-Fox Chicago News reports that a potential online sales tax will hurt Illinois web-based businesses like Groupon and Coupon Cabin. A new piece of legislation waiting to be signed into law calls for “online retailers such as Amazon and Overstock to collect a 6.25% sales tax if they have affiliates in the state.” Although not signed by the governor just yet, the tax proposal may eventually be challenged in court and will certainly see some sort of opposition from businesses and consumers alike.

One of the most popular ways to save for college is to utilize a 529 plan. A 529 plan is a simple education savings program that is not subjected to federal or state taxes if used directly on college expenses. Along with being tax-advantaged, 529 plans come in two varieties: A 529 savings plan and a prepaid tuition plan. A 529 savings plan involves a money manager or financial advisor investing the contributions you make into options such as mutual funds or age-based portfolios. Prepaid tuition plans allow you to pay for future college expenses at today’s prices. Each plan comes with its own restrictions, level of flexibility, and additional cost so deciding which type is most appropriate for you and your child depends on your specific needs and qualifications.

We at Cline Financial know how important it is to keep your child’s future in mind when making financial decisions. An investment in a college education is one that comes with a lot of thought and planning, but our team of financial professionals are more than happy to help you along the way while working with you to give you the information and assurance you need when planning your child’s educational future. Visit us at our Champaign office to learn more about education planning and the many other financial services we offer.

Although mostly geared towards planning for retirement, Roth IRAs can be opened on behalf of kids or teens as early investments. Although they must actually earn money equal to the Roth contribution to be eligible to maintain the account, teens may be able to work part-time jobs in stores or restaurants while younger kids can earn money through babysitting, lawn mowing, or even being hired by their self-employed parents, all avenues which are qualified sources of compensation for the Roth IRA account.

Roth IRAs have recently been in the news with a major deadline approaching in December for investors. According to the Wall Street Journal, all taxpayers are able to convert their regular IRA accounts to Roth IRA accounts and if done so by December 31^st of this year, taxpayers will be able report the income on their 2010 tax returns or have that income spread equally across their 2011 and 2012 tax returns.

Buy Investments:

Using the extra cash to buy investments that supplement your portfolio is always a great option. If you’ve done your research, buying investments with high potential becomes much easier to swallow when you have a few “extra” dollars.

Rebalance Your Current Investments:

Avoid selling appreciated assets and use your extra money to help create a healthy balance of stocks, bonds and cash. Not only does that shore up your portfolio –– it helps you avoid paying capital gain taxes.

Add to Your Retirement Account:

If you’re not taking advantage of your employer’s retirement match policy –– consider using your extra money as a “catch-up” contribution. If you’re new to the professional world, adding as much as you can to your retirement plan will be invaluable down the road. If you’re over the age of 50, consider the contribution a make-up for that stretch when you were a little short years ago.

Add to Your Emergency Fund:

We don’t have to tell you the importance of having an emergency fund set aside. Typically, emergency funds cover 6 months of living expenses. Adding a little extra is always a good idea, and if you’re short –– solidifying an emergency fund is an important investment that everyone should have.

These are just a few of the options that we recommend to our Champaign and Bloomington customers; however, we do stress the importance of having your financial situation analyzed. Adding to your retirement plan, setting up an IRA, or saving for your child’s college are fantastic investment plans –– but they all should be put into perspective with your financial portfolio. We tailor all of our advice to your financial situation. Visit our Champaign office to find out more.

To begin, it is very important to sit down with a professional and map out your expenses.  Programs like these do have limits regarding the amount of funds that can be used. Usually, dependent care allows around $5,000 and medical care will allow $2,000 sometimes $3,000 for use. These accounts should be used up accordingly as they come with a forfeit stipulation. It’s important to note – leftover money cannot be transferred to new accounts or rolled-over for the next term. In cases with leftover funds, the money is absorbed at the end of the year and will not be returned to the account holder. It is better to use all of the funds in your FSA by the end of each term.

If you’re considering an FSA in the near future, we encourage you to come visit Cline Financial Concepts for an initial evaluation of your situation. Understand that you don’t have to be alone when it comes to planning your financial future. Our trained professionals are here for you, catering to clients in near by cities like Bloomington and Peoria. We can help answer any questions you may have. Visit us today and start down the path to a solid financial future.