What Is a Signing Bonus

You are looking at multiple job offers, and under one of the perks of one of them you see the phrase “signing bonus.” Although you know that a bonus is good, you may not understand what word “signing” means in this context. If that’s the case, then we have got you covered!

What Is a Signing Bonus?

A signing bonus is an award amount that goes directly to a worker who signs on to a new job. A signing bonus is typically a one-time incentive that companies use to make their job offer more attractive. A signing bonus assists a company in some ways:

·         May make their offer more attractive than another company’s offer

·         Is only a one-time bonus rather than a permanent salary bonus

·         Can be a bonus that only takes effect after a certain amount of time

Is a Signing Bonus Immediate?

Although all signing bonuses are given to the candidate immediately after they sign on to the job, when it is actually the employee’s bonus is entirely dependent on the contract that someone signs. In some cases, the bonus is immediately gifted to the new employee at the time of their taking the offer. However, other companies may set up a bonus that goes with the first paycheck that the employee earns. Yet, some signing bonuses can be taken back by a company if the person leaves or is fired before their probationary period. Therefore, a signing bonus may not stay in the candidate possession if they leave the company before a certain date.

Although signing bonuses are a perk, creating an investment plan can lead to a much bigger payday. If you are interested in investing but don’t know where to start, check out our website for more information!

Loan Tips for Recent Graduates

Your college career has ended, and you probably had some great times. However, now that you are done with school, it is time to think about next steps—one of them being your repayment plan for your school loan. Although your loan principal may be high, some tips can help you out.

Loans Are Typically in Deferment Until Six Months After Graduation

Many students worry that their loans will go into repayment immediately after graduation; however, that is not the case. For almost all of your school loans, private and government funded, there will probably be a time of deferment. This deferment period is a time after graduation where your loans are not yet in repayment, which means you don’t have to rush to find a job due to repaying your loans. Typically speaking, loans will stay in deferment status for six months after graduation, and after that, the status will go into repayment.

Doing More School? Your Loans May Stay in Deferment

If you are going to graduate school or some other form of secondary education, your loans may stay in deferment and never go into repayment until after you finish your master’s degree. This may be true as long as you are enrolled in a program within six months of your graduation date from your undergraduate degree.

Some Loans Take Accrued Interest and Add it to the Principal Once the Loan Goes into Repayment

Depending on the loan, the accrued interest attached to it may be added to the principal once the loan goes from a “deferred” to “repayment” status. Therefore, the interest from your loan from your freshmen year of college may move from the “accrued interest status” to add to the “principal.” This means the accrued interest will become part of the loan that grows interest, causing your loan total to increase. Therefore, it may be wise to pay off interest amounts of certain loans so that it doesn’t compound with the principal.

If you need other loan tips, or have questions about your financial future, contact American Investment Planners now!

Which Loan Should I Pay off First?

Sometimes people have to have things they can’t immediately afford in life. For example, high school students who go off to college rarely have the money they need to pay off school; families who are buying homes rarely have the means to purchase a house outright; and therefore, loans are a necessary part of life! However, repaying loans is never an easy feat, but deciding which loan to repay first can put you in the right direction.

Principal Is Key

Almost all loans gain interest overtime, but the amount of interest that a loan gains is entirely dependent on the principal (the amount the lender gives to the recipient.) For example, a credit card loan may have an insane interest rate (some cards have over a 20% yearly interest rate), but other loans can have an insanely high principal. For example, say someone has a credit card that has a 20% interest rate and a $300. When calculating for the year, the total interest for this card would be $60.

However, a loan from the government for a school bill may have an annual interest rate of 4.25%, which seems small in comparison to the interest rate of the credit card, but the loan principal is $20,000! Therefore, after a year of no repayments, the loan would garner $850.

As you can see, bigger principal loans typically garner more interest than bigger interest rate loans with small principals. However, a medium sized credit card debt can quickly take over other loans as the first repayment target. A credit card debt of $5,000 can gain interest at a rate of $1,000 a year! So despite the principal of the credit card debt being a fourth of the loan debt, the interest would be higher than the school’s.

As a general rule of thumb, any loan that has a medium-high amount of principal is probably the loan that needs to be repaid the soonest.

If you need help with planning out your financial future, contact us now for a free quote!

How a Traditional IRA Works

Millions of Americans work hard to ensure that they and their families are financially taken care of. While immediate needs are important, the reality is that future financial needs must be handled alongside immediate needs. For this reason, people take a portion of their pay and place it into traditional IRAs. Although hundreds of thousands of Americans have traditional IRAs, not everyone understands how they work.

What Is a Traditional IRA?

Traditional IRAs are a reliable form of retirement, but understanding how they function is vital to financial planning. Traditional IRA’s are retirement funds that are tax deductible when contributions are made. Therefore, investing for retirement is one way to receive significant tax breaks, but the government will come back for that money at a later date.

Let’s say someone invests $1,000 into a traditional IRA. This $1,000 would add to their tax breaks for the year that they invested. Once the money is invested, people typically choose investment plans that match their age till retirement. Younger people are encouraged to invest in riskier bids to make money faster; older people are encouraged to invest in safe proposals to keep their money safe. Essentially, the amount of risk someone should take when investing scales down the older someone gets. Once the investor reaches retirement age, they are now able to withdraw money from their account, but it comes at a price.

What Goes Around Comes Around

Remember how the investor received all those tax breaks when they contributed money to a traditional IRA? Well, the government remembers, and they are sure to remind people of their payments. When someone begins to withdraw money from a traditional IRA, the government requests that the person gets taxed on those withdrawals. This means the initial investment amount (the $1,000 mentioned above) and any earnings the $1,000 makes while in the traditional IRA is taxed by the government. Now you understand why putting money in a traditional IRA is tax-deductible, because the government wants your initial investment as large as possible to receive a bigger payday when a person withdraws money. Although the government makes money on your investment, so do you, so it is a fair trade!

If you are interested in applying for a traditional IRA or another retirement fund, contact us now! At American Investment Planners, our goal is to help people save money today for a brighter future tomorrow!

What Is a Roth IRA?

Many Americans worry about the future, and some people turn this worry into a productive decision to enroll in a retirement plan. A retirement plan ensures that an employee has something to live off one once they reach an age where they can no longer work. Although the goal of every retirement plan is to save money for the future, different plans try to accomplish this process in different ways. For this reason, it is important that one familiarize themselves with each plan in order to make the best retirement plan for their needs. One of these plans, which we will be looking at today, is a Roth IRA.

What Is a Roth IRA?

A Roth IRA is a retirement plan that taxes money differently than traditional IRA plans.

A Roth IRA is different from a traditional IRA in three main ways:

1.       A Roth IRA contribution is not tax deductible when filing taxes.

2.       A Roth IRA contribution is taxed before it is placed into savings.

3.       A Roth IRA’s income growth is not taxed.

Many people look at the first two differences and think that a Roth IRA is a poor choice, however, a Roth IRA has a huge benefit.

Roth IRA Earnings Are Never Taxed

Traditionally, earnings made on investments are taxed by the government, however, a Roth IRA’s earnings are not taxed by the government, which means all of the earnings go directly to the recipient. Let’s put it into perspective; say you want to put $100 dollars into a Roth IRA account. Supposing you make more than $38,700 but less than $82,500 a year, you are taxed 22% of your salary. Therefore, after you pay taxes, your $100 is turned into $78. However, let’s say you have 40 years of work until you retire, which means your $78 dollars has 40 years to grow. Supposing that the investment grows at a rate of 5% every 2 years, the final amount you would have in your Roth IRA would be $156 dollars.  This $156 dollars would be completely tax free, including the earnings! Therefore, your growth stays with you at the sacrifice of having less money to use at the beginning of your life. However, retirement is all about saving a stash of money for the end of your life, so having less money is no big deal!

If you are interested in obtaining a Roth IRA or other retirement fund, look no further than American Investment Planners. Our team can help you invest your money wisely and in through the methods that will be most helpful to you! Contact us now for a free quote.

How the Tax Bill May Affect You

Taxes are not something we think about often, especially when it’s outside of filing season. However, the tax bill does impact us throughout the year, even though we think about it during one particular season. Therefore, American Investment Planners decided to share important tax bill information with readers.

Income Tax Rates Are Lower

As you may have noticed in this year’s filing, the tax rate tiers were lowered in this tax bill. This means less money was taken from those with higher levels of income. For example, for someone who made $45,000, the tax rate was reduced from 25% to 22%. Although this 3% decrease may not seem like much, it comes out to $1,350 for a taxpayer making $45,000.

Standard Deduction Was Practically Doubled

Some taxpayers choose to itemize their taxes, but a vast majority use the standard deduction rate offered by the federal government. The new tax bill doubled the standard deduction rate, allowing single filer’s deductions to increase from $6,350 to $12,000. This deduction will help millions of Americans save thousands of dollars for the length of the bill.

Divorces Will Be More Expensive

In the past, alimony payments were tax deductible. However, under the new bill, alimony payments will be tax deductible for the recipient rather than the provider. This means the alimony money will be taxed on the higher tax payer’s dime rather than the lower tax payer’s dime. This means that overall, alimony payments will be smaller in size and more alimony money will go to taxes.

As you can see, the tax bill affects all Americans, from the poorest of the poor to the richest of the rich. When it comes to being tax savvy, preparation is critical. At American Investment Planners, we can help you prepare for next year’s tax season by helping you invest wisely now and assist you in filing taxes later. If you are interested in our services, reach out to use for a free quote!

Is Investing in Cryptocurrency a Good Idea?

Cryptocurrency has swept the nation, and thousands of Americans have decided to toss their money into the ring. While many have made thousands of dollars off of these investments, others have lost much, much, more. So what is the viability of cryptocurrency investing?

Investing in Cryptocurrency Is Similar to Gambling

Although various cryptocurrency companies have discussed case uses of their “products,” few (if any) have shown how cryptocurrency can be utilized in real life circumstances. Thus far, the hype over cryptocurrency is not backed by actual businesses or individual use cases, therefore, investing in cryptocurrency can be compared to gambling. Although people can (and have) made it big through cryptocurrency investment, it seems that high rollers did so on luck rather than actual fact-based positive business momentum. This can be seen in the chaotic movements of the cryptocurrency market. One day, the market jumps up 10% across the board, the next day, the market is down 30%. These kinds of jumps prove that many investors have no clue what to expect when it comes to cryptocurrency investments.

It’s an Extremely High-Risk Investment

There are high-risk stock investments, but cryptocurrency investing takes the risk to a whole other level. Traditional investing can be risky because new businesses may or may not make it into national or international markets; however, their business plans and goals are transparent to all potential investors. However, cryptocurrency companies are not held to the same standard of transparency, partly because numerous countries have not had a chance to talk about the legality of cryptocurrency trading. Therefore, investing in cryptocurrency is a lot like the Wild West.

At American Investment Planners, we make investing easy with diversified portfolios that can match your desired investment plan. We work with you to get the most out of your investment! If you are interested in investing with us, contact us now for a free quote!

What Is a Reverse Mortgage?

Mortgage loans are used by millions of Americans to afford their residence without having to put down the full value of a house. The idea of a traditional mortgage is that a bank is willing to loan money to a potential homeowner to allow them to afford a home without having the assists required to do so. Although a mortgage recipient may not have the means to buy the property outright, over time, the goal is to own the property at some point. However, a reverse mortgage is a different entirely.

What Is a Reverse Mortgage?

A reverse mortgage is a loan that allows senior citizens to liquidate their assets in preparation for a move from a home to a new living situation. A reverse mortgage is a scenario where a bank gives money to a senior citizen while they live in a home, and once the citizen moves out of the home, the bank will take the home and sell it as payment of the loan. During the years that the citizen resides in the home, he or she will still have to pay property taxes and for home insurance. However, the resident will not have to pay a mortgage, and in fact, he or she will be given money to pay for expenses like property taxes, medical needs, and other scenarios.

Some of the details of a reverse mortgage:

• ·         The collateral of the loan is the home’s equity.
• ·         Homes on a reverse mortgage need to maintain FHA guidelines.
• ·         The funds of a reverse mortgage may be restricted for the first 12 months after loan closing.
• ·         The owner typically sells the house to repay a reverse mortgage.
• ·         The owner is not liable for any debt the home’s sale does not cover.

As you can see, reverse mortgages can be extremely helpful for senior citizens who want to live in their home but have other expenses that need to be taken care of. If you have any questions regarding reverse mortgages, reach out to American Investment Planners to get the answers you need!

Why Are There Different Retirement Accounts?

Planning for the future starts today, which is why investing in a retirement fund is often the healthiest long term financial choice a person can make. Although retirement funds are incredibly beneficial, the reality is that many of these funds have different mechanics, some options are better than others depending on your work and financial situation. To help you understand the various types of retirement funds, here are our thoughts.

Roth IRA

A Roth IRA is similar to a traditional IRA with one main difference, the owner of the account pays taxes on the money before they invest it. Traditional IRAs tax the money you initially invested and the interest that your account accrues overtime. However, Roth IRAs do not tax earnings from your investments, nor do they typically tax the withdrawals that someone makes. Therefore, Roth IRAs help people keep their investments safe from taxes in exchange for taking an immediate hit on their tax breaks.

Traditional IRA

A traditional IRA is an account where money goes directly into a retirement account without getting taxed. While you are saving yourself from being taxed on that money now, the reality is that the money your investments make in the future will be taxed along with the money you withdrawal. Traditional IRAs are good for folks who are currently in a high seated tax bracket, but will retire in a lower tax bracket.

SEP IRA

A SEP IRA is fairly similar to a traditional IRA, but it is specifically for self-employed workers or small business owners. Contributions to these accounts earn tax breaks for the self-employed, but money that is withdrawn from an IRA will be taxed on withdrawal. Additionally, earnings made form SEP IRA’s will also be taxed, just like a traditional IRA.

If you are interested in starting a retirement account, you should talk to the professionals before making a decision. Reach out to American Investment Planners to get the answers you need about retirement investing!

Benefits of a Money Market Account

What if your savings account had better interest rates? What if you could make more money with a checking account? This is where a money market account can help you make money on your savings!

A money market account is an account that grows interest at a faster rate than a generic savings account while additionally allowing the owner to have limited check-writing abilities. Therefore, a money market account offers the owner benefits from both a savings and a checking account! A money market account typically requires a higher starting balance than a savings account and is Federal Deposit Insurance Corporation (FDIC) insured.

Deciphering Money Market Account Mechanics

Money market accounts offer higher annual percentage yields than the average savings account because the vehicles can invest in numerous higher-profit options from which traditional passbook accounts are restricted. As a result, banking institutions are the ones who provide access to insured money market deposit accounts (MMDA). These accounts offer FDIC backing and the portfolios are made up of short-term, liquid securities. The reason banks can offer a higher interest rate through MMDA’s is that they require a higher minimum balance. Additionally, these accounts have restrictions on the rate of how fast an owner can take out his or her money.

The withdrawal restrictions make MMDAs less liquid than checking accounts, but more liquid than bonds. Financial institutions use money market accounts to pursue investments through vehicles like certificates of deposit, government securities, and commercial paper. These investments offer better yields than those of a general savings account.  The minimum a person is required to deposit funds for an MMDA is dependent on the financial institution he or she is investing with.

Warning: An MMDA is a higher risk investment than a savings account. Due to the nature of the securities that MMDAs use as vehicles, it is possible to lose part of your principal balance in the event of a financial crisis.

If you want to discuss more pros and cons of money market accounts, reach out American Investment Planners today!

How to Conduct Salary Negotiations

Performing salary negotiations can be one of the hardest things about accepting a new job. Maybe you landed your dream job, and you don’t want to complicate things with negotiations. While that might be the case, your starting salary is a significant number because every bonus or pay raise you make after the fact will be based on that starting salary number. Therefore, making a case for a higher starting rate can be crucial in getting better pay raises in the future:

Push the Boundaries Based on Situation

Your ability to negotiate well is often dependent on your overall job situation. If you need the job you received an agreement letter for, you have less wiggle room to negotiate since losing the job position is more important than making some extra cash per year. However, if you have received job offers from competing jobs, you now have the freedom to ask your second choice how much they are willing to pay you when you start. The idea behind this conversation is that you have a preferred working environment already secured, and so you now have the ability to ask your second best option what they are willing to increase your salary to. The worst case scenario is that they get offended and rescind your offer, which doesn’t matter because you have another offer on the table that you are happy with. The best case scenario is that they offer you a better starting salary than your other offer, which now makes this your best offer. The cool thing about this kind of negotiation tactic is that you can then use this salary offer to ask your first choice if they are willing to increase their offer to match the now better second offer.

Research Job Salaries for a Specific Job in that Area

Knowing what a standard salary for a job in a specific area is before you go into negotiations is super important. While you may think that the job offer is small for the work you will be doing, comparing this salary offer with similar positions online lets you know the truth about the health of your offer. Maybe your offer is better than you thought, or perhaps your proposal is worse than you could have imagined. Either way, knowing how your offer compares to similar job titles gives you the knowledge you need to make wise negotiation tactics.

Although salary negotiations are necessary, how you invest the money you make is often more crucial than any bonus you will get. Therefore, make sure you have the investment help you need by reaching out to American Investment Planners!

When You Need Life Insurance

When we think of life insurance, we typically think of policies that senior citizens have to give their grandchildren some money should they suffer an untimely death. However, for many people who are much younger than senior citizens, holding life insurance should be non-negotiable.

When People Need Life Insurance

When Dependents Become a Part of the Picture

People with a spouse or children should undoubtedly have life insurance policies. Although your spouse may have a job and earn a decent salary, holding life insurance can guarantee that your spouse will be able to deal with bills and debts should anything happen to you. While a spouse can use life insurance money for some debts, a person with children should undoubtedly carry life insurance. Children are expensive, and being a single parent can be a nightmare, especially when the situation stems from an unexpected death. Providing for your family is your number one priority, but if you are gone, who is going to take care of them? A life insurance policy that covers you and your spouse will guarantee that your children will be financially sound despite your absence.

When People Are Traveling Overseas

Although traveling is not inherently dangerous, many people engage in new activities and adventures when they are abroad. Snorkeling, driving off-road vehicles, parasailing, and other activities are generally safe, but when inexperienced people are trying to enjoy these various activities, fatality is a real plausibility. Therefore, when people travel and vacation in unknown areas, life insurance can help loved ones rest easy should something go wrong.

Life insurance is a helpful tool for families who want to ensure their children are taken care of no matter the circumstances. If you need help finding the best life insurance policies for your needs, American Investment Planners has your back! Reach out to us with any questions you may have about coverage!

Why You Should Avoid Store Credit Cards

It is near impossible to leave a department store without hearing the phrase, “would you like to sign up for our membership program?” While some store employees are talking about a traditional no-obligation membership card that earns points, others are talking about a full blown store credit card. Unfortunately, store credit cards are typically pitfalls for anyone who struggles to manage their money well.

Store Credit Cards Have High Interest Rates

While store credit cards offer users some rewards after purchasing a certain amount of goods while using the card, they also contain higher than usual interest rates for those who fail to pay off their debt in a timely manner. In fact, many store credit cards charge an interest rate of more than 25% per year. This means a credit card charge of $1,000 will accumulate a $250 interest fee if it goes unpaid for a year. To put this in perspective, a typical student loan interest rate is near 5%. Therefore, store credit cards can cost users more despite the given awards.

Store Credit Cards Payments Are Easy to Forget

Making payments on a car, house, utilities, and credit cards are easy because these payments are typically synced up to a main banking account. However, store credit cards have their own websites that users need to visit to pay off their debts. Although the extra step of going to an outside website to pay off a debt may seem like a small inconvenience, just think of all the times you forget to buy an essential item at the grocery store. It only takes on regretful car ride home to realize how easy it is to forget something important. Unfortunately, this means taking an extra step to pay off a debt may result in forgetting about the debt in the first place.

Credit Cards from Your Bank Typically Offer Better Deals Overall

Although owning a credit card connected to a department store may earn you extra money for purchases from that store, the reality is that your rewards are set in stone at one retailor. Bank credit cards typically offer rewards that apply to multiple retailors. Although owning a credit card may be a bad investment in the first place, if someone wants to own a credit card, it is typically better to run a credit card through your banking institution for more versatile deals.

Financially staying above water can be difficult, but with American Investment Planners at your side, creating a financial portfolio has never been easier. If you want more pros and cons concerning store-related credit cards, contact us with your questions!

College Financial Aid Letters Explained

After weeks of anticipating their response, your dream college finally got back to you about your financial aid request. When you open up the envelope, the first thing you read is “Congratulations, you have qualified for an award!” However, before you start your victory dance, it’s imperative you understand exactly what this letter is offering!

What Is a Financial Award?

A financial award is a sum of money either gifted or loaned to a student to help them pay for their future schooling. As previously stated, some of these awards are gifts which the student is not expected to pay back.

Gift awards include the following

• ·         School Scholarships
• ·         Federal Grants
• ·         Non-federal Grants (from businesses and other entities)

While some of the awards are gifts, other awards are loans with different perks. Loans are sums of money that the students must pay back, usually accruing interest throughout a student’s college career.

Loan awards include the following

• ·          Federally subsidized loans (the government takes care of the interest of the loan while the student is in school)
• ·         Federally unsubsidized loans (the government does not pay for the interest on the loan, but the interest amount is usually lower than private loans)
• ·         School repayment options (the school allows a student to repay their semester’s cost throughout the semester)
• ·         Private loans (the school offers a loan from a specific lender such as a bank or other financial institution)

Unfortunately, many financial aid letters are unclear about an award type. Some of the listed awards may be grants; other awards may be loans that the student has no information on. Therefore, researching these awards is the first step to understanding financial aid letters.

Schools Are Not Forthcoming About True Cost

Many schools do not list the cost of obtaining a 4-year education in their financial aid letter; other schools list a “tuition cost,” but purposefully leave out room and board and other expenses. Therefore, it is up to you to figure out the actual cost of a 4-year education at a specific school by researching the school’s charges and comparing them to your grants. You should view loans as costs since you will have to pay them back. Once you count up your expenses and subtract your grants, you will find the true cost of your school.

Get the Help You Need

If you need help calculating your student tuition and determining your next steps, American Investment Planners is here to help.  Our intuition’s goal is to help people stay financially sound, even when they go into debt from tuition payments. We believe financial planning is the answer to almost every financial issue! Contact us now for a free quote!

Financial Mistakes New Graduates Need to Avoid

Many people say that graduating from college is the beginning of the rest of your life. You are no longer in school, you have no more classes, you have no more teachers, and you are just starting your job hunt to launch your career! While graduating from college is a fantastic accomplishment, many students get an F when it comes to financial planning for the future. Therefore, we at American Investment Planners want to give you a few tips to dodge some financial pitfalls of recently graduated students.

Don’t Move for a Job Unless You Sign a Contract

When you graduate, it may be the first time in your life you have the freedom to move anywhere in the world. This is an exciting prospect for many young workers, but securing a job before you move is crucial to your financial success. Although you may not have much, getting your things from point A to point B costs money, and attempting to go across the United States (or overseas) without a guaranteed job can land you in the fast food industry. Before you move, find a job, if you land the job, make sure to sign a contract before you move. Without a signed contract, a “you got the job” over the phone means nothing. Don’t spend the money till you sign the deal!

Pay Off Your School Debt as Soon as Possible

For government loans, you have six months of deferment from the last day of your enrollment. Therefore, you do not have to pay back a penny of your loans until six months after your graduation date. Deferment is the government’s way of letting you settle your accounts and find a job before forcing you to pay back your loans. While this is an excellent perk for you, if you land a job and start to make a stable income, you should start to attack your loans as soon as possible! Waiting for deferment to kick in to pay off your loans often means that your accrued interest will be added to your loan’s principal. This means you will have a more significant lump sum to pay off, which then accrues interest at a faster rate. It is likely that you won’t have the money to squash your loans entirely, but if you can pay off the interest that your loan has accrued before your loan goes off of deferment, you will stop your loan from compounding.

Refrain from Credit Card Use for Anything Other than Necessary Purchases

Although a credit card is a handy tool that can help you in sticky situations when money is tight, you should never use a credit card for unnecessary purchases when you can’t pay off those purchases within a month. You probably have thousands of dollars of debt due to school loans, and using a credit card for superfluous purchases can send your money (and your credit) down the drain. Focus on purchasing what you can afford, and only use a credit card for unavoidable emergencies. The last thing you need is more loans you can’t repay!

We hope this list is helpful for you as you start your new journey! If anything on this list confuses you or you need clarification, reach out to us here!

Why You Should Enroll Your Student Loans in Auto-Pay

When it comes to paying your student loans, if there are ways you can make things easier, you should. While there are definitely things you can do pay them off quicker, one thing you should do — as long as you have the option —  is enroll your student loan payments in auto-pay. Here are just a few reasons why:

You can enroll while you're still in school.

Many student loan lenders, especially private ones, offer you the chance to enroll your student loans in auto-pay while you're still in school in order to start paying off the interest. Typically, they only ask for a small amount such as $25 or $50 per loan per month. This can benefit you a lot since, the sooner you start paying off your loans, especially the interest on them, the sooner you can be done with them.

You can qualify for a lower interest rate.

When you enroll  in auto-pay, many lenders will give you a lower interest rate as an incentive. While your principal doesn't change, having a lower interest rate can make a big difference in how much you end up paying back over time.

You will never forget to make a payment.

It’s not uncommon for life to get in the way and make you forget to pay your student loans, manually, on time. When you're enrolled in auto-pay, you don't run the risk of missing a payment and potentially hurting your credit score or incurring a late fee.

Here at American Investment Planners LLC, we know that facing student loan debt can be hard to do, but we also know that with the right advice and guidance, it won't be so bad! If you have questions or concerns about your loans, contact us at (516) 932-5130 or email info@americaninvestmentplanners.com to set up an appointment with one of our advisors today.

Financial Graduation Gifts That are Better Than Cash

Graduation is one of the proudest moments of a person’s life. He or she has worked hard for the past few years to earn a degree in the field of his or her dreams —  so it's no surprise that you would want to reward them for that. While most graduation gifts end up being cash, why not give your graduate something that he or she can really benefit from?

Retirement Funds

Offering to start funding a retirement account, such as a Roth IRA, can help your grad begin planning for the future. Often, these things aren’t at the top of new graduate’s mind, so starting one for them can really put them on the right track. Plus, starting a retirement fund earlier allows the principal to compound for longer.

Investments

These are typically a good idea if you’re in a higher tax bracket, as gifting appreciated stocks could lower the assumed capital gains tax. Since new graduates tend to be in a lower tax bracket, the investments won’t be taxed at as high of a capital rate if they sell them. And who knows, certain investments could inspire an interest and love for the stock market!

Student Loan Payments

It’s no secret that loan payments are one of the biggest fears students have upon graduating, so why not make it easier on them? Offering to pay a certain percentage or even repayment period of their loans can help them start saving money sooner and not feel as financially burdened right after graduating.

The best gift you can give to a college student is a 529 plan started years before they even apply — and we can help you start one! American Investment Planners LLC offers tax planning, estate planning, retirement planning and more to generations of families throughout the United States. More information about the services offered is available at www.americaninvestmentplanners.com.

Things to Remember as a First-Time Renter

Finally moving out of Mom and Dad’s house can be one of the most exciting and nerve-wracking experiences of your life. While we're sure you're thrilled to finally have your own place, moving out isn't as simple as it seems. If you are a first-time renter,  these are some things you should keep in mind.

Upfront Costs

Rarely will you find a landlord that doesn't expect you to pay a security deposit as well as at least one month’s rent up front. That being the case, you have to have enough money saved up to be able to pay that before moving in. You also may have to pay application fees or real estate fees on top of that.

Long-Term Costs

Once you move out, you're not just paying basic rent each month. You’ll have to factor in the cost of utilities, food, and other amenities, such as internet, into your monthly budget. It's also wise to get renter’s insurance that way you're protected in case something should go wrong.

Furniture Costs

In some cases, you may be lucky enough to be able to bring your bed and dresser from home with you to your new apartment. However, you're still probably going to need things like living room furniture and kitchen appliances — all of which cost more money.

Pet Costs

A lot of young people are tempted to get a pet once they move out, whether it be because they finally can without their parents’ permission or just want the company. But it's extremely important to be aware of how much a pet costs. You'll need to be able to pay for food, veterinary visits, grooming, and more — not to mention a potential pet fee your landlord may charge you just to have your furry friend. If you’re not able to comfortably afford all that, don’t get a pet so quickly.

American Investment Planners LLC offers tax planning, estate planning, retirement planning and more to generations of families throughout the United States. More information about the services offered is available at www.americaninvestmentplanners.com.

Financial Preparing for a Vacation

When you're planning a vacation, it's easy to just focus on what hotel you'll be staying at, what excursions you'll take, and how often you’ll eat at the all-inclusive restaurants. While all of that is very exciting, it's important to make sure you're financially ready for your vacation, so keep a few things in mind.

Account for extra spending.

Sure, your hotel and plane ticket cost a certain amount of money, but what about the cost of souvenirs, taxi rides, or tips for the wait staff?  If you don't account for little expenses as much as the big ones, it can put a big rut in your plans.

Remember the exchange rates.

It's important to remember that the dollar doesn't have the same value as every other form of currency. If you bring along $500 as spending money, but convert it to a currency that doesn't value the dollar as high, you could end up having much less in your pocket than you planned.

Careful with your credit cards.

It’s easy to say you'll just swipe everything on vacation  and have one bill at the end of it, but that's not the best idea. Just like at home, it's easier to spend more when you're using plastic versus cash. Plus using a credit card on vacation can put you at risk of identity theft if someone steals your information.

Remember your regular bills.

Just because you're going on an extended vacation, it doesn't mean that your utility company or mortgage lender stop sending you bills. If you have the option, request that those companies not send paper bills to your home while you're away, and just pay your bills online. This way, you stay on top of your payments, and don't risk your bills, or identity, getting stolen.

American Investment Planners LLC offers tax planning, estate planning, retirement planning and more to generations of families throughout the United States. More information about the services offered is available at www.americaninvestmentplanners.com.