How do you assist charities you care about while staying on track with your personal financial goals and budget?

According to Chabad, tzedakah is the uniquely Jewish perspective on charity.

Tzedakah is a mainstay of Jewish life. The sages teach that the world was built upon kindness. Tzedakah goes one step beyond. Literally translated as “justice” or “righteousness,” tzedakah tells us that sharing what we have with others isn’t something special. It’s the honest and just thing to do.

One of the bigger shopping challenges has always been buying gifts for Dad. Since the pandemic changed work attire forever, it also eliminated the lame but reliable fallback of a tie.

Tips on how to make this year’s savings plan work.

When I was a financial planner, we helped individuals and families address their sequential financial needs and priorities at each stage of their lifecycle. There are three major stages of one’s financial lifecycle:

Teach your children about the importance of saving versus spending.

This article was written by Nina Swartz (Needleman) and published in the St Louis Women’s Journal, October/November 2005 edition.

Some say that there is a three-legged stool supporting retirement: social security, a life-long job pension, and savings or investments. However, the solvency and future coverage of social security is a big question mark. In addition, pensions are not offered by as many employers and usually don't have as much time to compound given shorter tenure in jobs. So, two out of the three legs of this stool seem shaky as they are determined by factors beyond our control. The one leg of the stool we can control is the savings and investments leg. For many of us, our employer offered retirement plan is the first place we invest for retirement; and in many cases, it is the primary retirement vehicle used due to its ease of use through payroll deduction. Therefore, participation in employer sponsored retirement plans is a critical determinant of our ability to accumulate assets for our financial independence. Frequently, when people leave one job and go to another, they leave money in the retirement plan of their prior employer.

What are the two most common mistakes people make regarding their prior employer retirement assets?

1. Liquidate or sell their prior employer 401K, 403B, Simple IRA, IRA or other retirement plan assets, and take the 10% IRS penalty on the plan distribution;

What is the popular "logic" regarding this action?:

- "I'm out of work now, so better to use this money to pay off debts I may not have income to cover for awhile"

-"Even 90% of the money is more useful to me now than it'll be 30 years from now when I retire"

- "I'm young and can make up for cashing out now by saving/investing extra when I'm older, more secure and making more money"

2. Leave the money with the old employer.

What is the prevailing logic with this action?

- "The employer will be there forever, my money will be safe."

- "If I touch or move the money before age 59 1/2, it'll be taxed"

- “I need to worry about finding a new job now, I can get back to doing something with this later.”

- “The company will keep me informed about updates and changes... no need to worry about that."

In most cases, the realities contradict common perceptions above. In actuality, the following certainties/risks exist:

- Your prior employer doesn't care about you.

- Your prior employer may or may not forward updates, changes, or new choices in the employee retirement plan(s).

- You prior employer will not invite you to the annual benefits meeting to talk about your plan, the investment options, your participation, the benefits of the matching contribution.

- Your prior employer will not ask about your risk tolerance or help in any way to make sure your investment choices are appropriate.

- Your prior employer will not provide advice or an advisor to help you review or rebalance your allocations based on market performance or changes in your life or priorities.

- Your prior employer will not look for you if you move. Unclaimed assets after a certain amount of time may be escheated to your state of residence when you worked at that company.

Other relevant facts:

- Given the 7 or 8 job changes predicted for a working person today, and the likely unemployment periods in between jobs, it will be very difficult if not impossible for those who cashed out a prior employer plan to make up the lost savings.

- The power of compounding is greatly reduced when your holding period in an investment is eliminated and restarted again.

- Rolling over the money, i.e. transferring directly from one trustee to another without your "touching" the money is NOT a taxable event.

-Many people under-estimate the demands on their income in older ages and over-estimate their ability to increase retirement saving.

- In some employer retirement plans, plan loans are available. Although interest must be paid, in some cases, taking a loan could be a better choice than losing 10% of your assets and future growth forever.

What should you do?

- Find a financial advisor you can trust: One who is recommended or one who has a philosophy that matches your own.

- Interview the financial advisor to make sure her services include:

A risk analysis to determine what kind of investor you are;

-A disciplined planning strategy that is understandable and implemented consistently;

· An objective voice that offers historical perspective and realistic expectations;

· Periodic review meetings no less than on an annual basis;

Planning for retirement is one of the most important activities of your working years. It is not enough to just have dollars sitting in a plan. Your retirement plan needs an annual check-up to make sure every invested dollar is an employee that's working hard for you! Keeping your portfolio diversified and balanced is one of the best ways to ensure you can become financially independent on your chosen timetable and terms!