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POS Plans

February 19, 2019

John Jastremski Presents:

 

POS Plans

 

You’re not alone if you’re feeling confused by health-care plans that offer you benefits with one hand and place restrictions on you with the other. Fortunately, the world of managed care has begun to loosen up. And point of service (POS) plans may be leading the way. A POS plan is a type of managed care health system that maintains a network of physicians, hospitals, medical labs, and pharmacies for the health care of its members. POS plans blend the provisions of two major managed care models, combining the low out-of-pocket costs of health maintenance organizations with the flexibility of preferred provider organizations.
A quick overview of managed care

Managed care systems were developed to provide health care to members at a reasonable price. Costs are controlled in several ways. One way is to limit medical procedures that the plan considers unnecessary or inappropriate. Many traditional health insurance plans, in contrast, generally pay for the medical expenses incurred by its members without imposing stringent cost controls. Another measure that managed care providers use to hold down costs is to subsidize prevention and wellness programs, such as smoking-cessation classes, health education classes, and memberships to fitness clubs. The healthier you are, the less need you may have for medical care.
Your primary care physician is the gatekeeper to further care

As a member of a POS plan, you’ll be expected to choose a primary care physician (PCP) from a network of doctors sponsored by the plan. Your PCP acts as your main contact within the network and is responsible for most of the care you receive on a regular basis. In addition, your PCP is said to act as a gatekeeper by coordinating your access to specialists and other caregivers within the network. But you may go to physicians outside the network if you choose.
If you need a specialist, it’s best to get a referral

If you develop a medical condition requiring specialized care, you must get a referral from your PCP before you seek care from a specialist or another physician within the network. This screening process helps to reduce costs for both the POS and its members. If your PCP doesn’t provide the referral you feel that you need, you can go outside the POS network for treatment and see any doctor or specialist you choose without consulting your primary physician.
You can choose to go outside the network, but at a price

A POS plan allows you the freedom to seek care outside its network of providers. If you choose, you can even mix the types of care you receive. For example, your child could see a pediatrician outside of the network, while you continue to receive health care from network providers. Of course, you’ll pay substantially more out-of-pocket charges for any medical care your family receives from a non-network provider–encouraging you to stay within the network, but notrequiring it. When using health-care services within the plan’s network, you generally pay no deductible and only a minimal co-payment. If you go outside the network, you’ll likely be subject to a deductible and may have to pay a substantial portion of the non-network physician’s charges.
You’ll pay nominal co-payments for network care

Co-payments are usually minimal for POS network care, often running about $10 per treatment or office visit. You always retain the right to seek care outside the network at a lower level of coverage. But substantial co-payments for care outside your POS network give you a strong financial incentive to stay inside the network for most or all of your medical needs. For example, your co-payment may be only $10 for care obtained from network physicians, but you could be responsible for up to 30 or 40 percent of the cost of treatment provided by a non-network provider.
There’s generally no deductible for network care

When you choose to use network providers, there is generally no deductible. So, coverage begins from the first dollar you spend as long as you stay within the POS network of physicians. But an annual deductible must be met for out-of-network care. In most cases, you must pay a specified amount out of your own pocket before coverage begins. On average, individual deductibles are around $300 per year for an individual and $600 for a family. This deductible amount is in addition to your co-payments.
You should expect an annual cap on your out-of-pocket costs

Your annual out-of-pocket costs are generally limited to a maximum dollar amount stated in the policy. The annual limit on your health expenses for a POS plan, including deductibles and co-payments, is typically around $2,500 for an individual and $4,000 for a family. If you don’t know what the cap on your annual payments is, talk to your insurance company or plan administrator.

This material was prepared by Broadridge Investor Communication Solutions, Inc., and does not necessarily represent the views of John Jastremski, Jeremy Keating, Erik J Larsen, Frank Esposito, Patrick Ray, Robert Welsch, Michael Reese, Brent Wolf, Andy Starostecki and The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.

The Retirement Group is not affiliated with nor endorsed by fidelity.com, netbenefits.fidelity.com, hewitt.com, resources.hewitt.com,  access.att.com, ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that specializes in transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.

John Jastremski is a Representative with FSC Securities and may be reached at www.theretirementgroup.com.

Life Insurance and Charitable Giving

February 19, 2019

John Jastremski Presents:

 

Life Insurance and Charitable Giving

 

Life insurance can be an excellent tool for charitable giving. Not only does life insurance allow you to make a substantial gift to charity at relatively little cost to you, but you may also benefit from tax rules that apply to gifts of life insurance.
Why use life insurance for charitable giving?

Life insurance allows you to make a much larger gift to charity than you might otherwise be able to afford. Although the cost to you (your premiums) is relatively small, the amount the charity will receive (the death benefit) can be quite substantial. As long as you continue to pay the premiums on the life insurance policy, the charity is guaranteed to receive the proceeds of the policy when you die. (Guarantees are subject to the claims-paying ability of the issuing insurance company.) Since life insurance proceeds paid to a charity are not subject to income and estate taxes, probate costs, and other expenses, the charity can count on receiving 100 percent of your gift.

Giving life insurance to charity also has certain income tax benefits. Depending on how you structure your gift, you may be able to take an income tax deduction equal to your basis in the policy or its fair market value (FMV), and you may be able to deduct the premiums you pay for the policy on your annual income tax return. When an insurance contract is transferred to a charity, the donor’s income tax charitable deduction is based on the lesser of FMV or adjusted cost basis.
What are the disadvantages of using life insurance for charitable giving?

Donating a life insurance policy to charity (or naming the charity as beneficiary on the policy) means that you have less wealth to distribute among your heirs when you die. This may discourage you from making gifts to charity. However, this problem is relatively simple to solve. Buy another life insurance policy that will benefit your heirs instead of a charity.
Ways to give life insurance to charity

The simplest way to use life insurance to give to a charity is to name a charity to receive the benefits of your life insurance policy. You, as owner of the policy, simply designate the charity as beneficiary. Designating the charity as beneficiary may allow you to make a larger gift than you could otherwise afford. If the policy is a form of cash value life insurance, you still have access to the cash value of the policy during your lifetime. However, this type of charitable gift does not provide many of the income tax benefits of charitable giving, because you retain control of the policy during your life. When you die, the proceeds are included in your gross estate, although the full amount of the proceeds payable to the charity can be deducted from your gross estate.

Another alternative is to donate an existing life insurance policy to charity. To do this, you must assign all rights in the policy to the charity. You must also deliver the policy itself to the charity. By doing this, you give up all control of the life insurance policy forever. This strategy provides the full tax advantages of charitable giving because the transfer of ownership is irrevocable. You may be able to take an income tax deduction equal to the lesser of your adjusted cost basis or FMV. The policy is not included in your gross estate when you die, unless you die within three years of the transfer. In this case, your estate would get an offsetting charitable deduction.

A creative way to use life insurance to donate to a charity is simply for the charity to insure you. To use this strategy, you would allow the charity to purchase an insurance policy on your life. You would make annual tax-deductible gifts to the charity in an amount equal to the premium, and the charity would pay the premium to the insurance company.

One final method is to use a life insurance policy in conjunction with a charitable remainder trust. This strategy is relatively complex (it will require an attorney to set up), but it provides greater advantages than other, simpler methods. You set up a charitable remainder trust and transfer ownership of other, income-producing assets to the trust. The income beneficiary of the trust (you or whomever you designate) will get the income from the assets in the trust. At the end of the trust term (which might be a certain number of years or upon the occurrence of a certain event, such as your death), the property in the trust would pass to the charity. You’ll receive a current tax deduction when you establish the trust for the FMV of the gifted assets, reduced according to a formula determined by the IRS. Life insurance can then be purchased (usually inside an irrevocable life insurance trust to keep the proceeds out of your estate) to replace the assets that went to the charity instead of to your heirs.

This material was prepared by Broadridge Investor Communication Solutions, Inc., and does not necessarily represent the views of John Jastremski, Jeremy Keating, Erik J Larsen, Frank Esposito, Patrick Ray, Robert Welsch, Michael Reese, Brent Wolf, Andy Starostecki and The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.

The Retirement Group is not affiliated with nor endorsed by fidelity.com, netbenefits.fidelity.com, hewitt.com, resources.hewitt.com,  access.att.com, ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that specializes in transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.

John Jastremski is a Representative with FSC Securities and may be reached at www.theretirementgroup.com.

Are You Covered If . . . ?

February 19, 2019

John Jastremski Presents:

 

Are You Covered If . . . ?

 

If something just happened and you need to know if you’re covered, you should immediately call your insurer or agent or take a look at your policy. But if you’re simply wondering what’s covered (and what’s not) for future reference, you might start by familiarizing yourself with some real-life scenarios.
A word of caution

It’s important to understand a few things upfront. First, there are several types of standard homeowners policies, and each provides different coverage. What’s more, even policies of the same type often don’t provide exactly the same coverage. Another key point: To say that you’re covered for something doesn’t always mean that you’re fully covered. Out-of-pocket deductibles typically apply to the dwelling and personal-property portions of your policy, and every part of your policy is subject to coverage limits. Losses that exceed these limits must be paid out of your own funds.
Your house: are you covered if . . . ?

  • Lightning strikes a power line leading to your house and starts a fire? Yes. Fire damage is standard coverage.
  • A delivery truck careens off the road and smashes into your house? Yes. Damage from vehicles is standard coverage.
  • A pipe bursts in your cellar and covers your downstairs room with water? Yes. Water damage from burst pipes is standard coverage.
  • A huge gust of wind blows a tree onto your house? Yes. Windstorm damage is standard coverage in most parts of the country.
  • A repairperson damages your walls and ceilings? Yes. It doesn’t matter who caused the damage.
  • The river behind your house floods, and you have water damage? No. Flood protectionrequires separate insurance. So does earthquake coverage.
  • Your house slides down a cliff? No. You need separate insurance to protect against this.
  • Mice infest your home and chew up your insulation? No. The same exclusion applies to infestation by insects and other pests.
  • The market value of your home plummets? No. Market value has nothing to do with insurance that is based on replacement cost.
  • A house that you haven’t lived in for months is vandalized? No. To be covered, the house can’t have been vacant for more than 30 days.
  • You need to upgrade your home to meet local building codes? It depends. You may need an optional endorsement for this.
  • Your home is damaged by water coming in from backed-up sewers? It depends. This coverage may also require an endorsement.

Your personal property: are you covered if . . . ?

  • A wild animal gets into your house and rips apart your upholstery? Yes, unless the animal is a rodent or a pet of yours. If the rodent or pet causes a fire, you’re covered for the fire damage.
  • A thief breaks into your home and steals your stereo, jewelry, and the family silver? Yes, but keep in mind that separate coverage maximum limits apply to some types of personal property.
  • Your golf clubs are stolen from the trunk of your car? Yes (even though the theft occurred off your premises), but you may not receive the full replacement value.
  • Your wardrobe is ruined by the smoke from a fire? Yes. Clothing falls under personal property coverage.
  • The power goes out on your block, causing the food in your refrigerator to spoil? Yes, under most policies ($500 is a standard limit).
  • The laptop computer that you use for your home business is stolen? No. The laptop would be covered only if it were for personal use at home.
  • Your boat is damaged in a storm? No, unless it meets the requirements for a “small-motor” boat. Boats generally require separate insurance.
  • Your central air-conditioning breaks down in the middle of summer? No. Homeowners insurance doesn’t cover heating, cooling, and plumbing systems or home appliances for simple breakdown. If they are damaged by a covered peril, such as fire, they are covered.
  • A repairperson scratches up your furniture? No, in most cases. Damage to your personal property is usually covered only when it’s caused by a named peril (e.g., fire or vandalism).
  • A company dumps toxins into the creek that runs through your yard? No. The company that did this would be responsible for the cleanup bill and other damages.
  • Your fine art collection is stolen? It depends. In many cases, you need a special endorsement to cover valuable art and antiques.
  • The movers you hired damage your belongings? It depends. Some policies will cover insured property during a move. Otherwise, you need separate transit insurance.

Your liability: are you covered if . . . ?

  • You accidentally leave your boots on the front step, and your invited neighbor trips over them, breaking her hip? Yes. This is a straightforward liability question.
  • You accidentally run your shopping cart over a man’s foot at the grocery store, breaking his foot? Yes. Your liability coverage protects you off your premises as well as on.
  • Your son hits a baseball through your neighbor’s window? Yes, as long as your son didn’t break the window on purpose.
  • Your dog bites a passerby on the street? Yes. However, many insurers will cover you only for a certain number of dog bites (in some cases, only one).
  • After an accident at your home, the injured party brings a lawsuit against you, and you’re saddled with legal fees? Yes. Most homeowners policies cover the costs of defending you against lawsuits.
  • A client is injured by falling boxes in your home office? No. Separate liability coverage is needed when you run a business out of your home.
  • You’re renting out part of your house, and your tenant’s stuff is stolen from the premises? No, and you’re not liable, either. Your tenant needs renters insurance to protect his or her belongings.
  • You beat up someone who insulted your wife? No. Homeowners insurance does not cover liability arising from injuries you have intentionally caused.
  • You throw a rock at a squirrel and it hits and injures a neighbor? Yes, because even though throwing the rock was an intentional act, you didn’t mean to hurt your neighbor.
  • You swing the sail on your boat and accidentally hit your passenger with it? No. Homeowners insurance does not cover liability arising from the use of boats and watercraft.
  • You accidentally run someone over while driving down the street? No, because your auto insurance would cover your liability in a case like this.
  • A tree falls from your yard into your neighbor’s yard, breaking his fence? It depends. Your neighbor’s insurance would generally cover damage to his own property. However, if you were negligent (e.g., your neighbor told you the tree was dying, and you did nothing), you’d have to turn to your own liability coverage.

This material was prepared by Broadridge Investor Communication Solutions, Inc., and does not necessarily represent the views of John Jastremski, Jeremy Keating, Erik J Larsen, Frank Esposito, Patrick Ray, Robert Welsch, Michael Reese, Brent Wolf, Andy Starostecki and The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.

The Retirement Group is not affiliated with nor endorsed by fidelity.com, netbenefits.fidelity.com, hewitt.com, resources.hewitt.com,  access.att.com, ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that specializes in transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.

John Jastremski is a Representative with FSC Securities and may be reached at www.theretirementgroup.com.

Driving Defensively at Any Age

February 19, 2019

John Jastremski Presents:

 

Driving Defensively at Any Age

 

Ah, the lure of the road! There’s nothing like the ability to hop in the car and go. Driving gives us a sense of freedom, mobility, and convenience. If you want to stay safe (and keep your insurance premiums low), you’ll need to drive defensively.
Do unto others, and watch what they do unto you

In some respects, driving defensively is about guessing. You want to communicate clearly with others on the road, so they won’t have to guess what you’re going to do. At the same time, you want to guess what others might do that could put you in harm’s way, and take steps to avoid the harm.

Here’s some tips every driver should keep in mind:

  • Maintain your car, particularly the tires, brakes, lights (including turn signal and hazard lights), and windshield wipers.
  • Clean all your windows (inside and outside) and mirrors, and keep them free of obstructions.
  • No matter what time of day it is, turn on your lights on gloomy days or while driving in poor weather conditions. Always use your lights during the twilight times–the half-hours after sunrise and before sunset.
  • Reduce your speed in bad weather and at night. In the dark or in fog, don’t drive beyond what your headlights will illuminate.
  • Use your turn signals, even if only changing lanes.
  • Watch for turning vehicles, and be cautious about trusting another driver’s turn signal that’s been on for a while; watch for the execution of the turn, rather than the intention.
  • Keep your distance from other vehicles (especially large trucks), particularly those in front of you, and stay out of their blind spots (close up behind them on either side). If you can’t see a truck’s side mirrors, the trucker can’t see you.
  • When pulling away from a stop sign or a traffic light, check the intersection for oncoming cross traffic.
  • Always wear your seat belt; it’ll keep you in place if you suddenly have to change direction.

The young and the restless

It’s an unfortunate fact, but drivers 16 to 24 years old have the most trouble focusing on the job at hand. Since they haven’t yet driven much, they’re inexperienced at scanning traffic. As a result, they fail to recognize danger while it’s still at a safe distance, and they’re sometimes slow to make a tough decision. What they’ve learned about good driving is too often offset by their overconfidence and willingness to take risks. Compared with other age groups, teenage drivers are more likely to drive too fast, follow too closely, and leave too little margin for error. As a result, they have the highest rate of accidents and fatalities per mile driven–and the highest auto insurance rates to show for it.

In addition to the tips listed above, if you’re a teen, here are some things you can do to improve your safety record on the road. They include:

  • Pulling away gradually: Jackrabbit starts out of intersections are for jackrabbits.
  • Looking twice before pulling out, especially to your right: You’d be surprised how often an oncoming car has been hiding behind your passenger-side windshield post.
  • Looking to your rear before backing out of a parking space in a lot: Maybe the people directly behind you are leaving, too; you don’t want to rear-end their car.
  • Looking both left and right when making a right turn: Granted, the traffic’s coming toward you from the left, but that lady on the curb to your right entered the crosswalk while you weren’t looking. . . .
  • Turning your head to physically check for a clear passage before you change lanes.
  • Keeping 2 seconds of distance between you and the car in front of you; 4 seconds if you’re going over 35 miles per hour: Mark when the car ahead of you passes a certain point, and do the “one thousand one, one thousand two” routine until you reach the same point; if you didn’t even reach two, back off!
  • Watching the road 12 seconds down the road: Give yourself plenty of time to see trouble developing.
  • Slowing down!

The not-so-safe senior?

Aging may not cause accidents, but older individuals do have some special concerns when it comes to maintaining safe driving habits. Medical problems (or the medications prescribed for them) can affect one’s ability to drive. Signs of unsafe driving practices among seniors can include:

  • Stopping when there’s a green light, or running a red light without realizing it
  • Drifting from one lane to another
  • Confusing the gas and brake pedals
  • Unwittingly hitting or coming close to people, cars, or other objects
  • Getting lost in familiar places
  • Going too slowly

When measuring the number of crashes per mile driven, the accident rate for seniors begins to rise at age 70 and goes up rapidly at age 80. These factors cause insurance premiums to rise for drivers entering their 60s, and to increase thereafter. Taking a driver improvement course may reduce these increases; many states require insurance discounts for drivers (usually those over 55) who complete a state-certified course.

Some steps you can take to maintain good habits and to drive defensively as you grow older include:

  • Seeing a doctor: Have a physical exam, including vision and memory testing. Review what medications you take, and their side effects.
  • Checking the visibility: Can you still see clearly all around you? Make sure your seat cushions provide firm support. To minimize potential whiplash, center your head restraint even with your ears, not on the base of your neck.
  • Planning your trips: You can then concentrate on your driving, not on figuring out how to get there. Let passengers help with the navigating.
  • Trying to avoid driving in bad weather, in heavy traffic, or on unfamiliar roads: If you can’t avoid driving at night, use the day/night positions on the rearview mirror to reduce headlight glare.
  • Learning where your dashboard controls are: When driving, find them by feel, and keep your eyes on the road.
  • Watching for the flashing lights from emergency vehicles: You may not always hear the sirens.

This material was prepared by Broadridge Investor Communication Solutions, Inc., and does not necessarily represent the views of John Jastremski, Jeremy Keating, Erik J Larsen, Frank Esposito, Patrick Ray, Robert Welsch, Michael Reese, Brent Wolf, Andy Starostecki and The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.

The Retirement Group is not affiliated with nor endorsed by fidelity.com, netbenefits.fidelity.com, hewitt.com, resources.hewitt.com,  access.att.com, ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that specializes in transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.

John Jastremski is a Representative with FSC Securities and may be reached at www.theretirementgroup.com.

Variable Annuities

February 19, 2019

John Jastremski Presents:

 

Variable Annuities

 

A variable annuity is a contract between an individual (the purchaser) and an insurance company (the insurer). In return for premium payments, the insurer agrees to make periodic payments to the purchaser (if the purchaser elects this option), beginning either immediately or at some future date. Deposits can be made by either a single purchase payment or a series of purchase payments.

Purchasers of variable annuities have some control over the manner in which their annuity premiums are invested (unlike fixed annuities). The investment options (or subaccounts) of a variable annuity will usually include stocks, bonds, money market instruments, or some combination of the three. As the purchaser, you can designate how your premium dollars will be allocated among the offered investment choices.
Variable annuity features

Like all annuities, variable annuities possess a unique combination of attributes:

  • Tax deferral: Taxes on the income and investment gains from the annuity are deferred until money is withdrawn. Note that all distributed earnings are taxed at ordinary income tax rates and never at capital gains rates. Distributions taken before age 59½ are subject to a 10 percent early withdrawal penalty tax on earnings, unless an exception applies.
  • Periodic payments: Proceeds can be distributed in periodic payments for the life of the annuitant, or for the lives of the annuitant and a spouse (or some other person). If this option is elected, the annuitant cannot outlive the payment stream.
  • Death benefits: If an annuitant dies before reaching the annuity payout date, his or her beneficiary is generally guaranteed a death benefit. (Guarantees are subject to the claims-paying ability of the issuing insurance company.) The amount of the death benefit is usually the greater of an amount specified in the annuity contract, or the amounts contributed to the contract and the investment income credited to the contributions, reduced by any withdrawals made from the annuity. Annuity proceeds paid at the death of the annuitant will bypass probate if left to a named beneficiary.
  • The funds in an annuity are generally unreachable by creditors (laws vary by state).

A note about variable annuities

Variable annuities are long-term investments suitable for retirement funding and are subject to market fluctuations and investment risk including the possibility of loss of principal. Variable annuities contain fees and charges including, but not limited to mortality and expense risk charges, sales and surrender (early withdrawal) charges, administrative fees and charges for optional benefits and riders.

Variable annuities are sold by prospectus. You should consider the investment objectives, risk, charges, and expenses carefully before investing. The prospectus, which contains this and other information about the variable annuity, can be obtained from the insurance company issuing the variable annuity, or from your financial professional. You should read the prospectus carefully before you invest.

Certain riders and options relating to immediate annuities may be available for an additional fee or charge, depending on the issuer. Read the annuity’s prospectus or contract for a description of the available options and associated fees and charges, if any.
The accumulation phase and the payout phase

Like other annuities, there are two phases to a variable annuity: the accumulation phase and the payout phase.

During the accumulation phase, you (as the purchaser of the annuity) make payments that are allocated to the various investment options. You can typically transfer funds from one investment option to another without paying tax on the investment income and gains.

After the accumulation phase, the funds are paid out (the payout phase). At the beginning of the payout phase, you generally elect how you want the proceeds distributed–in a lump sum, as funds are needed, or annuitized over your life, the joint life of you and another individual, or over a specific period of time.

The amount of each periodic payment you receive depends in part, of course, on how you elect to take payouts.
The death benefit

Variable annuities commonly provide a death benefit. The amount of the death benefit is specified in the annuity contract, and it may be calculated as the greater of some guaranteed minimum (e.g., all purchase payments minus withdrawals) or all the proceeds in the account at the time of death. (Guarantees are subject to the claims-paying ability of the issuing insurance company.)

Many variable annuities allow you to choose a stepped-up death benefit for an additional charge. The stepped-up benefit is a higher guaranteed death benefit, for which the insurance company charges extra premiums. The advantage of these benefits is that you will know with some certainty how much your beneficiary will receive when you die.

A number of other optional benefits can be purchased as part of a variable annuity policy to guarantee higher streams of payments. Of course, these benefits add to the cost of purchasing the annuity.
Annuity fees

Among the many major differences between mutual funds and variable annuities are the fees charged. Both mutual funds and annuities may charge a load (sales commission) plus a management fee (a fractional percentage of the total assets). The sales load can be an up-front amount to buy into the fund or a deferred sales charge (surrender charge) that is applied only on withdrawals during the initial years after purchase (usually about seven years).

Variable annuities also charge mortality fees that cover the cost of the guaranteed death benefit and the risk that annuitants receiving lifetime payouts will live longer than expected. Other annuity charges may include an administrative fee to cover record keeping and other administrative expenses. This fee may be charged as a flat account maintenance fee or as a percentage of the total account value. There may also be a fee for transferring your money from one investment option (subaccount) to another. This fee may be assessed if you exceed a given number of free transfers in a year.

This material was prepared by Broadridge Investor Communication Solutions, Inc., and does not necessarily represent the views of John Jastremski, Jeremy Keating, Erik J Larsen, Frank Esposito, Patrick Ray, Robert Welsch, Michael Reese, Brent Wolf, Andy Starostecki and The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.

The Retirement Group is not affiliated with nor endorsed by fidelity.com, netbenefits.fidelity.com, hewitt.com, resources.hewitt.com,  access.att.com, ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that specializes in transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.

John Jastremski is a Representative with FSC Securities and may be reached at www.theretirementgroup.com.

The Sandwich Generation: Juggling Family Responsibilities

February 19, 2019

John Jastremski Presents:

 

The Sandwich Generation: Juggling Family Responsibilities

 

At a time when your career is reaching a peak and you are looking ahead to your own retirement, you may find yourself in the position of having to help your children with college expenses while at the same time looking after the needs of your aging parents. Squeezed in the middle, you’ve joined the ranks of the "sandwich generation."
What challenges will you face?

Your parents faced some of the same challenges that you may be facing now: adjusting to a new life as empty nesters and getting reacquainted with each other as a couple. However, life has grown even more complicated in recent years. Here are some of the things you can expect to face as a member of the sandwich generation today:

  • Your parents may need assistance as they become older. Higher living standards mean an increased life expectancy, and you may need to help your parents prepare adequately for the future.
  • If your family is small and widely dispersed, you may end up as the primary caregiver for your parents.
  • If you’ve delayed having children so that you could focus on your career first, your children may be starting college at the same time as your parents become dependent on you for support.
  • You may be facing the challenges of "boomerang children" who have returnedhome after a divorce or a job loss.
  • Like many individuals, you may be incurring debt at an unprecedented rate, facing pension shortfalls, and wondering about the future of Social Security.

What can you do to prepare for the future?

Holding down a job and raising a family in today’s world is hard enough without having to worry about keeping the three-headed monster of college, retirement, and concerns about elderly parents at bay. But if you take some time now to determine your goals and work on a flexible plan, you’ll save much stress–and expense–in years to come. Planning ahead gives you the chance to take the wishes of the entire family into account and to reduce future disagreements with your siblings over the care of your parents.

Here are some ways you can prepare now for the issues you may face in the future:

  • Start saving for the soaring cost of college as soon as possible.
  • Work hard to control your debt. Installment debts (car payments, credit cards, personal loans, college loans, etc.) should account for no more than 20 percent of your take-home pay.
  • Review your financial goals regularly, and make any changes to your financial plan that are necessary to accommodate an unexpected event, such as a career change or the illness of a parent.
  • Invest in your own future by putting as much as you can into a retirement plan, where your savings (which may be matched by your employer) grow tax deferred until you retire.
  • Encourage realistic expectations among your children; their desire to attend an expensive college will add to your stress if you can’t afford it.
  • Talk to your parents about the provisions they’ve made for the future. Do they have long-term care insurance? Adequate retirement income? Learn the whereabouts of all their documents and get a list of the professionals and friends they rely on for advice and support.

Caring for your parents

Much depends on whether a parent is living with you or out of town. If your parent lives a distance away, you have the responsibility of monitoring his or her welfare from afar. Daily phone calls can be time consuming, and having to rely on your parent’s support network may be frustrating. Travel to your parent’s home may be expensive, and you may worry about being away from family. To reduce your stress, try to involve your siblings (if you have any) in looking after Mom or Dad, too. If your parent’s needs are great enough, you may also want to consider hiring a professional geriatric care manager who can help oversee your parent’s care and direct you to the community resources your parent needs.

Eventually, though, you may decide that your parent needs to move in with you. If this happens, keep the following points in mind:

  • Share all your expectations in advance; a parent will want to feel part of your household and may be happy to take on some responsibilities.
  • Bear in mind that your parent needs a separate room and phone for space and privacy.
  • Contact local, civic, and religious organizations to find out about programs that will involve your parent in the community.
  • Try to work with other family members and get them to help out, perhaps by providing temporary care for your parent if you must take a much-needed break.
  • Be sympathetic and supportive of your children–they’re trying to adjust, too. Tell them honestly about the pros and cons of having a grandparent in the house. Ask them to take responsibility for certain chores, but don’t require them to be the caregivers.

Considering the needs of your children

Your children may be feeling the effects of your situation more than you think, especially if they are teenagers. At a time when they are most in need of your patience and attention, you may be preoccupied with your parents and how to look after them.

Here are some things to keep in mind as you try to balance your family’s needs:

  • Explain fully what changes may come about as you begin caring for your parent. Usually, children only need their questions and concerns to be addressed before making the adjustment.
  • Discuss college plans with your children. They may have to settle for less than they wanted, or at least take a job to help meet costs.
  • Avoid dipping into your retirement savings to pay for college. Your children can repay loans with their future salaries; your pension will be the only income you have.
  • If you have boomerang children at home, make sure all your expectations have been shared with them, too. Don’t be afraid to discuss a target date for their departure.
  • Don’t neglect your own family when taking care of a parent. Even though your parent may have more pressing needs, your first duty is to your children who depend on you for everything.

Most importantly, take care of yourself. Get enough rest and relaxation every evening, and stay involved with your friends and interests. Finally, keep lines of communication open with your spouse, parents, children, and siblings. This may be especially important for the smooth running of your multi-generation family, resulting in a workable and healthy home environment.

This material was prepared by Broadridge Investor Communication Solutions, Inc., and does not necessarily represent the views of John Jastremski, Jeremy Keating, Erik J Larsen, Frank Esposito, Patrick Ray, Robert Welsch, Michael Reese, Brent Wolf, Andy Starostecki and The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.

The Retirement Group is not affiliated with nor endorsed by fidelity.com, netbenefits.fidelity.com, hewitt.com, resources.hewitt.com,  access.att.com, ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that specializes in transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.

John Jastremski is a Representative with FSC Securities and may be reached at www.theretirementgroup.com.

Teaching Your College-Age Child about Money

February 19, 2019

John Jastremski Presents:

 

Teaching Your College-Age Child about Money

 

When your child first started school, you doled out the change for milk and a snack on a daily basis. But now that your kindergartner has grown up, it’s time for you to make sure that your child has enough financial knowledge to manage money at college.
Lesson 1: Budgeting 101

Perhaps your child already understands the basics of budgeting from having to handle an allowance or wages from a part-time job during high school. But now that your child is in college, he or she may need to draft a “real world” budget, especially if he or she lives off-campus and is responsible for paying for rent and utilities. Here are some ways you can help your child plan and stick to a realistic budget:

  • Help your child figure out what income there will be (money from home, financial aid, a part-time job) and when it will be coming in (at the beginning of each semester, once a month, or every week).
  • Make sure your child understands the difference between needs and wants. For instance, when considering expenses, point out that buying groceries is a need and eating out is a want. Your child should understand how important it is to cover the needs first.
  • Determine together how you and your child will split responsibility for expenses. For instance, you may decide that you’ll pay for your child’s trips home, but that your child will need to pay for art supplies or other miscellaneous expenses.
  • Warn your child not to spend too much too soon, particularly when money that has to last all semester arrives at the beginning of a term. Too many evenings out in September eating surf and turf could lead to a December of too many evenings in eating cold cereal.
  • Acknowledge that college isn’t all about studying, but explain that splurging this week will mean scrimping next week. While you should include entertainment expenses in the budget, encourage your child to stick closely to the limit you agree upon.
  • Show your child how to track expenses by saving receipts and keeping an expense log. Knowing where the money is going will help your child stay on track. Reallocation of resources may sometimes be necessary, but help your child understand that spending more in one area means spending less in another.
  • Encourage your child to plan ahead for big expenses (the annual auto insurance bill or the trip over spring break) by instead setting aside money for them on a regular basis.
  • Caution your child to monitor spending patterns to avoid excessive spending, and ask him or her to come to you for advice at the first sign of financial trouble.

You should also help your child understand that a budget should remain flexible; as financial goals change, a budget must change to accommodate them. Still, your child’s ultimate goal is to make sure that what goes out is always less than what comes in.
Lesson 2: Opening a bank account

For the sake of convenience, your child may want to open a checking account near the college; doing so may also reduce transaction fees (e.g. automated teller machine (ATM) fees). Ideally, a checking account should require no minimum balance and allow unlimited free checking; short of that, look for an account with these features:

  • A simple fee structure
  • ATM or debit card access to the account
  • Online or telephone access to account information
  • Overdraft protection

To avoid bouncing checks, it’s essential to keep accurate records, especially of ATM or debit card usage. Show your child how to balance a checkbook on a regular (monthly) basis. Most checking account statements provide instructions on how to do this.

Encourage your child to open a savings account too, especially if he or she has a part-time job during the school year or summer. Your child should save any income that doesn’t have to be put towards college expenses. After all, there is life after college, and while it may seem inconceivable to a college freshman, he or she may one day want to buy a new car or a home.
Lesson 3: Getting credit

If your child is age 21 or older, he or she may be able to independently obtain a credit card. But if your child is younger, the credit card company will require you, or another adult, to cosign the credit card application, unless your child can prove that he or she has the financial resources to repay the credit card debt. A credit card can provide security in a financial emergency and, if used properly, can help your child build a good credit history. But the temptation to use a credit card can be seductive, and it’s not uncommon for students to find themselves over their heads in debt before they’ve declared their majors. Unfortunately, a poor credit history can make it difficult for your child to rent an apartment, get a car loan, or even find a job for years after earning a degree. And if you’ve cosigned your child’s credit card application, you’ll be on the hook for your child’s unpaid credit card debt, and your own credit history could suffer.

Here are some tips to help your child learn to use credit responsibly:

  • Advise your child to get a credit card with a low credit limit to keep credit card balances down.
  • Explain to your child that a credit card isn’t an income supplement; what gets charged is what’s owed (and then some, given the high interest rates). If your child continually has trouble meeting expenses, he or she should review and revise the budget instead of pulling out the plastic.
  • Teach your child to review each credit card bill and make the payment by the due date. Otherwise, late fees may be charged, the interest rate may go up if the account falls 60 days past due, and your child’s credit history (or yours, if you’ve cosigned) may be damaged.
  • If your child can’t pay the bill in full each month, encourage him or her to pay as much as possible. An undergraduate student making only the minimum payments due each month on a credit card could finish a post-doctorate program before paying off the balance.
  • Make sure your child notifies the card issuer of any address changes so that he or she will continue to receive statements.
  • Tell your child that when it comes to creditors, students don’t get summers off! Your child will need to continue to make payments every month, and if there’s a credit card balance carried over from the school year, your child may want to use summer earnings to pay it off in order to start the next school year with a clean slate.

Finally, remind your child that life after college often involves student loan payments and maybe even car or mortgage payments. The less debt your child graduates with, the better off he or she will be. When it comes to the plastic variety, extra credit is the last thing a college student wants to accumulate!

This material was prepared by Broadridge Investor Communication Solutions, Inc., and does not necessarily represent the views of John Jastremski, Jeremy Keating, Erik J Larsen, Frank Esposito, Patrick Ray, Robert Welsch, Michael Reese, Brent Wolf, Andy Starostecki and The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.

The Retirement Group is not affiliated with nor endorsed by fidelity.com, netbenefits.fidelity.com, hewitt.com, resources.hewitt.com,  access.att.com, ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that specializes in transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.

John Jastremski is a Representative with FSC Securities and may be reached at www.theretirementgroup.com.

Personal Deduction Planning

February 19, 2019

John Jastremski Presents:

 

Personal Deduction Planning

 

Taxes, like death, are inevitable. But why pay more than you have to? The trick to minimizing your federal income tax liability is to understand the rules and make the most of your tax planning opportunities. Personal deduction planning is one aspect of tax planning. Here, your goals are to use your deductions in the most efficient manner and take all deductions to which you’re entitled.
Deductions lower your taxable income

Your first step is to understand how deductions work. You subtract certain deductions from your total income to arrive at your adjusted gross income (AGI). Then, you subtract other deductions and exemptions from your AGI to determine your taxable income. Your tax liability is calculated based on your taxable income. Generally speaking, therefore, the higher your deduction level, the lower your tax liability.
You can either take a standard deduction or itemize

After you’ve computed your AGI, you’ll generally want to subtract the greater of either the standard deduction or the total of your itemized deductions. The standard deduction is a fixed dollar amount, indexed for inflation yearly, that is determined according to your filing status (e.g., married filing jointly, single) and certain circumstances. Itemized deductions are various deductions that are reported on Schedule A of your federal tax return (Form 1040). They involve certain personal expenses, such as medical expenses, mortgage interest, state taxes, charitable contributions, theft losses, and miscellaneous itemized deductions. If you have enough of these types of expenses, your itemized deductions may exceed your standard deduction. In that case, it would be to your advantage to itemize.

When filling out your tax return, how do you know whether to take the standard deduction or itemize? You should calculate your taxes (including any alternative minimum tax) using both methods, and go with the one that lowers your tax liability the most. Be aware that there are some limitations regarding who can use the standard deduction and who can itemize. Also, certain itemized deductions are available to you only if your expenses exceed a particular percentage of your AGI. For example, miscellaneous itemized deductions are allowed only to the extent that they (when totaled) exceed 2 percent of your AGI. So, if your AGI is $100,000, your first $2,000 of miscellaneous itemized deductions won’t count toward your total itemized deductions. Your medical expense deduction may also be limited by your AGI.

Caution: There may be circumstances where it is better to itemize deductions even if the standard deduction is greater than itemized deductions. For example, if you are subject to alternative minimum tax, even a small amount of itemized deductions may be preferable to the standard deduction, which is reduced to zero for alternative minimum tax purposes.
The medical and dental expenses deduction: what it is, and how it involves your income level

The medical and dental expenses deduction is an itemized deduction that you may take (within certain limits) for unreimbursed medical and dental expenses you paid during the year for yourself, your spouse, and your dependents. You may be surprised to learn which medical and dental expenses are deductible and which are not; the line is sometimes blurry. For example, you can’t deduct your expenses for nicotine gum, but you can deduct your fee for a smoking cessation program. Many expenses qualify for this deduction, including acupuncture treatments, crutches, eyeglasses, and prescription drugs. You should obtain IRS Publication 502, Medical and Dental Expenses, for an authoritative list of eligible and nondeductible expenses. If you don’t review this list, you may miss out on some important tax-saving opportunities.

You can take this deduction only to the extent that your unreimbursed medical expenses exceed 7.5 percent of your AGI. That might sound complicated, but here’s how it works. First, add up your eligible medical expenses. You can deduct only part of that total on Schedule A of your federal income tax return. The schedule will actually lead you through this calculation. On that form, you’ll multiply your AGI by 7.5 percent (.075). The figure you come up with will represent the amount of your medical expenses that you cannot deduct. Subtract this figure from your total eligible medical expenses. The remaining amount is your medical deduction.

Note: Starting in 2013, the threshold to deduct medical expenses will be raised from 7.5 percent of adjusted gross income to 10 percent. The threshold increase will be delayed until 2017 for those age 65 or older.
Proper timing of your deductions will minimize your taxes

For most people, income is reported in the year that it’s received, while deductions are generally taken for the year in which expenses are paid. In many cases, you can control whether you incur an expense this year or next. That means that you can control the timing of your itemized deductions to some extent. If you’re in a higher income tax bracket this year than you expect to be in next year, you may want to accelerate your deductions into the current year to minimize your tax liability. You can do this by paying deductible expenses before year-end and making charitable contributions before year-end. For example, if you have major dental work scheduled for January of next year, you can reschedule for December to take advantage of the deduction this year. Here are some tips:

  • If you pay a deductible expense by check, make sure it’s dated and mailed before year-end. It needn’t clear the bank by year-end, however.
  • If you pay by credit card, the expense is deductible in the year the charge is incurred, not when the credit card bill is paid.
  • A mere pledge or promise to make a charitable contribution is not deductible.
  • Along with your cash contributions to a charity, remember to deduct noncash contributions like clothes. You can also deduct mileage if you use your car for charitable purposes.

This material was prepared by Broadridge Investor Communication Solutions, Inc., and does not necessarily represent the views of John Jastremski, Jeremy Keating, Erik J Larsen, Frank Esposito, Patrick Ray, Robert Welsch, Michael Reese, Brent Wolf, Andy Starostecki and The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.

The Retirement Group is not affiliated with nor endorsed by fidelity.com, netbenefits.fidelity.com, hewitt.com, resources.hewitt.com,  access.att.com, ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that specializes in transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.

John Jastremski is a Representative with FSC Securities and may be reached at www.theretirementgroup.com.

Guaranteed Annuity Contracts

February 19, 2019

John Jastremski Presents:

 

Guaranteed Annuity Contracts

 

As the name implies, a guaranteed annuity contract is an annuity that guarantees a fixed rate of return. In this respect, it is very similar to a fixed rate annuity.

What distinguishes a guaranteed annuity contract is that it covers a group of annuitants who are usually linked through work or membership in a group or organization. Since multiple annuitants can be covered under one contract, the expenses (per annuitant) for the annuity tend to be lower than if separate annuities were purchased for each person.

The issuer of the guaranteed annuity contract will usually guarantee that the annuity will be credited with a fixed rate of interest for a certain period of time. For example, the issuer may guarantee that it will pay 6 percent on the annuity for the first five years of the contract and then pay a minimum of 4 percent for the remainder of the contract. Typically, the annuity issuer will also agree to renew the annuity after the initial period and pay the higher rate of interest for another term, depending on the level of interest rates at the time.
Uses for group annuities

Guaranteed annuity contracts were developed in the 1920s and used frequently by large corporations to fund their defined benefit pension plans. During the 1970s, as the number of defined benefit pension plans declined, many companies used guaranteed annuity contracts to fund their defined contribution retirement plans.

The use of guaranteed annuity contracts has declined in popularity in recent years, partly because of the increased volatility of interest rates. Insurance companies that issue these contracts have been stung by unexpected interest rate changes that reduced profits or caused the companies large losses. Although some guaranteed annuity contracts are still in existence, very few companies or groups use this type of annuity to fund their pension plan obligations.

Today, the main use of guaranteed annuity contracts is to purchase benefits when a defined benefit pension plan is terminated. By definition, these terminated benefits must earn a stated rate of interest, determined by government regulations. The guaranteed annuity contract makes it relatively easy to ensure that these terminated benefits closely matched mandated rates with a minimum of administrative headaches for the plan administrator.

This material was prepared by Broadridge Investor Communication Solutions, Inc., and does not necessarily represent the views of John Jastremski, Jeremy Keating, Erik J Larsen, Frank Esposito, Patrick Ray, Robert Welsch, Michael Reese, Brent Wolf, Andy Starostecki and The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.

The Retirement Group is not affiliated with nor endorsed by fidelity.com, netbenefits.fidelity.com, hewitt.com, resources.hewitt.com,  access.att.com, ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that specializes in transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.

John Jastremski is a Representative with FSC Securities and may be reached at www.theretirementgroup.com.

The College Application Process

February 19, 2019

John Jastremski Presents:

 

The College Application Process

 

Like hot cocoa and apple pie, some things can be counted on to bring comfort every fall. Unfortunately, the college application process isn’t one of them. In fact, for your child, it probably ranks right up there with going to a new school or wearing that first pair of eyeglasses. It’s easy for your child to feel overwhelmed while trying to manage numerous applications, each with varying deadlines and requirements. Just imagine if you had to fill out multiple tax returns this year–and your future job depended on it!

But filling out college applications properly is crucial. After all, you and your child put a lot of time and effort into choosing schools–now it’s time to complete that process. Your child should allow plenty of time to work on the applications, and you’ll want to make sure that you’re available for help. Here are some things to keep in mind before your child gets started.
What’s required in the application?

Most college applications have standard requirements, such as:

  • Biographical and family information
  • List of extracurricular activities, hobbies, and interests
  • Reference letters (usually from teachers but occasionally from someone in the community)
  • High school grade transcript
  • SAT scores
  • Personal essay
  • Application fee

The key is for your child to present all of this information in the best possible light. Though your child won’t have any flexibility in the presentation of his or her personal information, grades, or SAT scores, he or she will have an opportunity to stand out from the pack with reference letters and the personal essay. Not surprisingly, then, these two items are very important.

Your child should spend some time thinking about the teachers whom he or she wants to write the recommendation letters. Also, your child should allow plenty of time for the teacher to write the reference, and tell the teacher what to do when finished (i.e., send the letter directly to the college–in which case a prestamped, preaddressed envelope should be provided–or give it back for inclusion with the rest of the application).

The personal essay is often the heart and soul of the application. It helps the admissions team distinguish your child from many other applicants and, in some cases, may be the deciding factor. To write a thoughtful, coherent essay, your child should choose a topic that is especially meaningful to him or her. As a parent, you’ll want to refrain from actually writing the essay (it’s also unethical for your child to hire a professional ghostwriter). However, you can certainly brainstorm for ideas with your child, offer editing suggestions, and proofread the final product for spelling and grammatical mistakes.

If your child needs help getting started, most college guidebooks devote a chapter to writing a good college essay. Ideally, your child should browse through this material early in senior year to get familiar with the process, before he or she faces the terror of writer’s block the weekend before the application is due.
The total package–what colleges look for in prospective applicants

Beyond grades and SAT scores, it’s no secret that colleges will be looking at your child’s extracurricular activities to see what interests and abilities he or she can bring to the campus. And as colleges have become more competitive, the quest of parents to find the “right” mix of activities has intensified. Many parents have spent countless hours (and dollars) driving their children to every extracurricular activity imaginable in an effort to ensure their child’s entry into a prestigious university. Yet this isn’t necessarily the magic elixir.

Instead, admissions officers generally say that they favor applicants who have demonstrated a real passion in one or a few areas, as opposed to those who participate in a long list of activities just for the sake of putting it on their application. So, instead of forcing your child to dabble in everything (e.g., music, art, theater, sports, community work, religious work, business internships), it’s better to let your child focus on those pursuits that he or she truly enjoys. And if your child doesn’t get accepted at a particular college, don’t take it personally–your child’s path to success doesn’t depend on just one college.
Timeline for applying

Generally, college applications are submitted in the fall or winter of your child’s senior year of high school, with acceptance or rejection letters arriving in the spring. However, if your child applies for early admission, the application deadline is earlier–the spring of your child’s junior year, with an acceptance or rejection coming in the fall of senior year. It’s important to note that the college application timeline isn’t the same as the financial aid timeline, which is usually later.

Each college has its own application deadline, as well as its own application requirements. To stay organized, write each deadline on a central calendar, and then create an individual folder for each college to keep track of applications, correspondence, reference letters, essay requirements, and other items. If the paperwork is too overwhelming, many colleges now allow applications to be submitted on-line; check with your child’s college to see if this is an option.
Early admission vs. regular admission

Some students favor early admission because it lets them relax and enjoy their senior year. There are actually several ways to apply for early admission:

  • Early action: Your child applies by the early deadline but has until the college’s normal deadline to decide whether to attend.
  • Early decision: Your child applies by the early deadline but then must commit to attending immediately.
  • Early notification: Your child applies by the early deadline and receives notification of his or her acceptance as the admissions office makes its decision. Your child then has until the college’s normal deadline to make a decision, though some colleges may try to pressure your child to decide earlier.
  • Early read: The college performs an “early read” on your child’s financial information to estimate his or her financial aid award.

If your child’s heart is set on a particular college and the match is a good one, it might be worthwhile for your child to apply for early admission. However, a note of caution–it’s easy for your child to wind up with less financial aid than a regular applicant. This is because colleges know that your child is already committed to attending the college; thus, they figure they can offer a less attractive financial aid package. And although your child can rescind an early decision acceptance if the college doesn’t offer adequate financial aid, he or she may be rushed in applying to other colleges.

This material was prepared by Broadridge Investor Communication Solutions, Inc., and does not necessarily represent the views of John Jastremski, Jeremy Keating, Erik J Larsen, Frank Esposito, Patrick Ray, Robert Welsch, Michael Reese, Brent Wolf, Andy Starostecki and The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.

The Retirement Group is not affiliated with nor endorsed by fidelity.com, netbenefits.fidelity.com, hewitt.com, resources.hewitt.com,  access.att.com, ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that specializes in transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.

John Jastremski is a Representative with FSC Securities and may be reached at www.theretirementgroup.com.