Have you ever taken a close look at paper money? Each U.S. bill has the words "Federal Reserve Note" imprinted across the top. But many individuals may not know why the bill is issued by the Federal Reserve and what role the Federal Reserve plays in the economy. Here's an inside look. The Federal Reserve, often referred to as "the Fed," is the country's central bank. It was founded by Congress in 1913 to provide the nation with a safer, more flexible, and more stable monetary and financial system. Prior to its creation, the U.S. economy was plagued by frequent episodes of panic, bank failures, and limited credit. The Fed has four main roles in the U.S. economy. Federal Reserve's 1st Goal: Economy Watch In addition to its other duties, the Fed has been given three mandates with the economy: maintaining maximum employment, maintaining stable price levels, and maintaining moderate, long-term interest rates. It's important to remember that the Fed cannot directly control employment, inflation, or long-term interest rates. Rather, it uses a number of tools at its disposal to influence the availability and cost of money and credit. This, in turn, influences the willingness of consumers and businesses to spend money on goods and services. For example, if the Fed maneuvers short-term interest rates lower, borrowing money becomes less expensive, and people may be motivated to spend. Consumer spending may stimulate economic growth, which may cause companies to produce more products and potentially increase employment. When short-term rates are low, the Fed closely monitors economic activity to watch for signs of rising prices. On the other hand, if the Fed pushes short-term rates higher, borrowing money becomes more expensive, and people may be less motivated to spend. This may, in turn, slow economic growth and cause companies to decrease employment. When short-term rates are high, the Fed must watch for signs of a decline in overall price levels. Federal Reserve's 2nd Goal: Supervise and Regulate The Fed establishes and enforces the regulations that banks, savings and loans, and credit unions must follow. It works with other federal and state agencies to ensure these financial institutions are financially sound and consumers are receiving fair and equitable treatment. When an organization is found to have problems, the Fed uses its authority to have the organization correct the problems. Federal Reserve's 3rd Goal: Financial System The Fed maintains the stability of the financial system by providing payment services. In times of financial strain, the Fed is authorized to step in as a lender of last resort, providing liquidity to an individual bank or the entire banking system. For example, the Fed may step in and offer to buy the government bonds owned by a particular bank. By doing so, the Fed provides the bank with money that it can use for its own purposes. Federal Reserve's 4th Goal: Banker for Banks, U.S. Government The Fed provides financial services to banks and other depository institutions as well as to the U.S. government directly. For banks, savings and loans, and credit unions, it maintains accounts and provides various payment services, including collecting checks, electronically transferring funds, distributing new money, and receiving and destroying old, worn-out money. For the federal government, the Fed pays Treasury checks; processes electronic payments; and issues, transfers, and redeems U.S. government securities. Each day, the Fed is behind the scenes supporting the economy and providing services to the U.S. financial system. And while the Fed's duties are many and varied, its focus is to maintain confidence in banking institutions. A Decentralized Central Bank The Federal Reserve System consists of 12 independent banks that operate under the supervision of a federally appointed Board of Governors in Washington, D.C. Each of these banks works within a specific district, as shown. Federal Reserve District boundaries are based on economic considerations; the Districts operate independently but under the supervision of the Federal Reserve Board of Governors. Final thought. Interest rate hikes or declines can significantly affect consumer finances. When the Fed alters rates, the effect spreads throughout the entire economy, impacting where individuals invest money to how they spend and borrow money. By understanding these connections you can help be more prepared for future interest rate changes. Are you comfortable with your progress towards retirement? How about helping future generations meet their financial goals? If you have more than $2 million saved and need help from a wealth manager, the Peak Wealth Planning team can assist. Peak Wealth Planning specializes in helping high-net worth individuals and families plan for the future. - - - - - - - - - - - - - - - About the Author Peter Newman is a Chartered Financial Advisor (CFA) and president of Peak Wealth Planning. He works with individuals nationwide that have accumulated wealth through company stock, ESOP shares, real estate, or running a business. Peter applies his unique background to help clients achieve their specific goals and enjoy peace of mind. Peak Wealth Planning offers personalized concierge services  to meet your wealth management needs, including  financial planning, investment management, ESOP diversification, retirement income, i nsurance, and estate planning. As a fee-based  financial advisor based in Chicago, Peak Wealth Planning serves a select group of clients in Illinois and across other states .

Originally published on Kiplinger.com on Sept 19, 2023 . 2021 was the year of the ” Great Resignation ”, a phenomenon where a significant number of employees voluntarily left their jobs in search of better work conditions and increased job satisfaction. If you are dissatisfied with your job and want to explore other opportunities, consider looking into an employee-owned company. Companies offering employee ownership grant their workforce a direct interest in the organization through an Employee Stock Ownership Plan (ESOP) . Approximately 6,500 ESOPs exist in the U.S., contributing to five key advantages. 1. Employee-owned companies with ESOP plans boost employee engagement through wealth distribution. Employee engagement is crucial for a company because it fosters productivity, innovation, and retention, ultimately driving better business performance and growth. ESOPs make their employees partial owners of the company. They share the rewards and risks that come with that ownership. If the company stock increases , so does the net worth of every employee. As a result, employee owners are more invested in helping the business succeed and more likely to tackle problems they see within the organization. 2. Employee-owned companies with ESOP plans offer higher job satisfaction. Job satisfaction is important for a company as it boosts employee morale, enhances productivity, and reduces turnover, leading to a more efficient and stable workforce. Employee-owned companies tend to offer higher job satisfaction because employees feel a stronger sense of motivation when they have a voice in shaping company success. According to recent research by the National Center for Employee Ownership , employee-owners are more likely to have higher wages , receive larger retirement benefits and are less likely to lose their job during a downturn than their peers at non-ESOP companies. 3. Employee-owned companies with ESOP plans have greater job security. Job security is important because it fosters a sense of stability, confidence and enables employees to focus on their work, leading to increased productivity, well-being and overall satisfaction in personal and professional lives. Employee-owned companies are more likely to prioritize long-term stability over short-term profits. This can result in greater job security for employees, as these companies are less likely to engage in mass layoffs or drastic cost-cutting measures that negatively impact employees. There is evidence that companies owned by employees grow faster due to the alignment of interests in wealth building for ESOP participants with employer goals. The company’s growth increases its overall enterprise value as well as the shares of stock in each participant’s retirement account. 4. ESOPs keep jobs local. Keeping jobs in the local community stimulates the economy, fosters community development and reduces unemployment. Many selling owners treat their employees like a family. Through employee ownership, ESOPs invest in their communities and reduce the likelihood of outsourcing or relocation. This can bring long-term stability and strengthen the local community. ESOPs allow private company owners to sell all, or a portion, of their company to the employees. This creates a market for the company’s stock without having to look months or years to find the right buyer . ESOPs enable owners to retain and reward employees who helped make the company a success. These owners and employees often live and work in the communities where the company operates. Selling to employees offers the possibility of keeping jobs local instead of selling to a private equity buyer that may move the operations to another city for economies of scale. By selling to employees, a retiring owner can ensure that their customers and employees will continue to benefit one another. 5. ESOPs build personal wealth. The objective for job seekers is to secure a role that aligns with their abilities and meets their desired financial compensation, ensuring a fulfilling and satisfactory employment experience. Besides offering competitive salaries and comprehensive benefits, ESOP companies provide employees with unique wealth-building opportunities in the Employee Stock Ownership Plan (ESOP). An ESOP is a company funded retirement plan, which typically requires no out-of-pocket contributions from employees. These plans have been cited as a major contributor to narrowing the wealth inequality gap . For many people, funding a contribution to a 401(k) each paycheck is a struggle. For employees like these, an ESOP might be the only retirement plan in which they can afford to participate. In fact, among a surveyed group of low- to moderate-income employee owners, those in the age bracket of 60 to 64 had 10 times greater wealth than the average American in the same age group. The average value held by employee owners in company ESOPs is over $129,000 . Planning your next career move. If you are intrigued by the prospect of working for an employee- owned company, consider the following resources to get you started on your next career move. Learn More About the Top 100 ESOP Companies Search ESOP Companies In Your State Find Jobs with Employee-Owned Companies If you do consider an employee-owned company for your next position, remember to look at the total benefit package. This includes salary, bonus, healthcare, dental and vision benefits, 401(k), ESOP and other benefits, such as time off, education reimbursement and gym or wellness benefits. While the ESOP can be a wonderful benefit, it should not be your sole criteria. If you already have the good fortune of working for an employee-owned company, future articles in this series will cover retirement planning and details ESOP participants should know about their benefits. Our next article will cover the mechanics of how an ESOP benefits its employees, including: vesting, stock valuation, getting paid with distributions, and tax treatment. Final Thought Are you comfortable with your progress toward retirement? Are you confident you’ll know how to handle your ESOP diversification and distribution when the time comes? Do you need help forecasting how your ESOP and 401(k) can generate retirement income? A wealth manager from the Peak Wealth Planning team can assist. Peak Wealth Planning specializes in helping high-net worth individuals and families plan for the future. - - - - - - - - - - - - - - - About the Author Peter Newman is a Chartered Financial Advisor (CFA) and president of Peak Wealth Planning. He works with individuals nationwide that have accumulated wealth through company stock, ESOP shares, real estate, or running a business. Peter applies his unique background to help clients achieve their specific goals and enjoy peace of mind. Peak Wealth Planning offers personalized concierge services  to meet your wealth management needs, including  financial planning, investment management, ESOP diversification, retirement income, i nsurance, and estate planning. As a fee-based  financial advisor based in Chicago, Peak Wealth Planning serves a select group of clients in Illinois and across other states .

Originally published on Kiplinger.com on October 11, 2023 . Employee Stock Ownership Plans (ESOPs) offer a unique opportunity for employees to participate in the growth and success of the companies they work for. These plans provide employees with a means of accumulating wealth and building a retirement nest egg . What is an ESOP? The ESOP is a tax-deferred retirement plan. Through your participation in the ESOP retirement plan, you have an ownership interest in shares of company stock that are credited to your ESOP account balance. These shares are provided each year at no cost to you. The account will grow if your company achieves good financial results. You will be taxed when you cash out the funds in your ESOP account. As an employee owner, you are part of a team whose actions and decisions impact the company’s financial results and your retirement account balance. The culture of employee ownership is not only about increasing the value of the company, but relating to peers, customers, suppliers and other companies in your industry, as well as the community in which you work. The information provided below may be different from your company’s ESOP, be sure to check with your representative. Company Contributions Your ESOP retirement account is company-funded, not employee-contributed like a 401(k) . Every year, the company’s board of directors decides whether and how much to contribute to the plan. Some ESOP companies aim for a steady benefit rate of 5% (or more) of eligible employee salary, while others vary year to year and may be less predictable. As an example, if your annual salary is $100,000 and the benefit level this year is 5%, your ESOP account balance would be credited with company stock shares worth $5,000. Stock Value and Your Retirement Account For ESOPs that are not publicly traded, the value of ESOP stock is usually determined once a year after the end of the company’s fiscal year. The ESOP trustee retains an independent valuation agent to determine the stock value. The valuation agent[1] reviews the company financial statements and business forecast of the company. If your company is affected by poor economic conditions or reduced customer demand, the value of company stock and your ESOP retirement account balance could fall. If customer demand increases and the company continues to be profitable, the value of company stock and your retirement account could rise. Stock Value Statements and Distribution Windows Once the stock value is determined, allocations of shares to your ESOP retirement account are completed. Most ESOP companies allocate shares and apply your vesting credits once a year. After your new balance is determined, you will receive an annual ESOP account statement. Your statement will show the beginning and ending balance of shares, new contributions allocated to your account, the new share price and the vested percentage of your account. As an example, let’s consider a 100% vested (more on vesting below) eligible participant with compensation of $102,000 and a 5% benefit level. At the beginning of the year, the employee’s account has 1,500 shares at $195 per share value, equaling $292,500 in ESOP value. Twenty-five new shares are credited to the employee’s ESOP account for the year, representing $5,125, or 5%, of the $102,000 annual salary. As of the end of the year, the employee has 1,525 shares times $205 per share equaling a new ESOP value of $312,625. If you are eligible to make a retirement distribution election or diversification request , you will be notified shortly after you receive your statement. How Vesting Works Vesting refers to the percentage of your account you are entitled to when you leave the company or begin taking distributions from your ESOP account. By law, vesting follows one of two schedules. Cliff vesting. No vesting in the first years of employment, followed by 100% vesting after not more than three years of service (usually 1,000 hours or more of work in a plan year). Graded vesting. Twenty percent vesting after the second year of service, with 20% more each year until 100% vesting occurs after the sixth year of service. Some companies have more generous vesting schedules than the ones outlined above. If you reach normal retirement age (65), die or become permanently disabled, or your plan is terminated, you become 100% vested immediately. The unvested value of your account balance is forfeited if you leave the company before you are 100% vested. Consult your ESOP representative to confirm your vesting schedule. Diversification Diversification reduces concentration risk in a single company stock. ESOP participants are provided with an option beginning at age 55 with 10 years of plan participation to diversify 25% of cumulative vested company shares. Upon attaining age 60, participants may elect to diversify up to 50% of cumulative vested shares. Diversification is the process of selling shares in your ESOP account and reinvesting the proceeds, also known as a rollover, in another tax-deferred 401(k) or IRA investment account. The 401(k) or IRA may offer a choice of stock, bond, ETF and mutual fund investments. An alternative to a rollover is to cash the check. Spending the cash reduces your retirement savings and subjects the payment to income taxes and IRS penalties if they apply. Diversification is the process of selling shares in your ESOP account and reinvesting the proceeds in another tax deferred 401k or IRA investment account. Distributions When You Leave the Company If you retire or terminate employment, you may be eligible to take distributions from your ESOP account vested balance. If the balance is $5,000 or less, it will often be paid in a lump sum. If your account balance is more than $5,000, it may be paid in a series of five substantially equal annual installments instead of a lump sum. If you depart prior to retirement age, you may need to wait to make a distribution election until the fifth anniversary of your termination date. Specific amounts and rules may vary by company. Yours may have a more generous payment schedule and may not have a waiting period. Some companies allow employees to participate in share price gains or losses while being paid installments, others freeze your share price when you terminate employment or retire. Be sure to check with your ESOP representative or review your plan document. If you die or become permanently disabled, you may be eligible for an accelerated distribution schedule. Retirement distributions can be requested when you retire (typically age 65). Some companies allow retirement as early as age 55 with 30 years of service. Retirement installments are generally paid in a series of five substantially equal installments. You must begin taking from your ESOP account balance by the time you reach age 73. Your company’s retirement schedule may vary from the one above. Form of Payment and Taxes As part of your distribution request, you can designate the form of payment. If you make a direct rollover to another retirement plan (a 401(k) or IRA), you continue to invest for retirement savings and defer paying taxes. If you do not elect a rollover and receive the payment by check, you have 60 days to deposit the money into another qualified retirement account to defer paying taxes. If instead of rolling the money to another retirement plan, you elect a direct payment, then you will be responsible for paying income taxes and an wearly-withdrawal penalty (if any applies under age 59½). Take Action The benefits and responsibility of being an employee-owner translate to taking responsibility for your own financial well-being. Below are steps you can take: Keep track of your ESOP and other retirement account balances. Check your financial plan to ensure you are on pace to meet your retirement goals. Consider the pros and cons of diversifying your company stock when eligible. Understand the tax implications of your choices. Forecast your retirement expenses and income. Our next article in this series will cover important facts employee owners should be aware of, including; how much your company contributes to your ESOP account and 401(k), how your company stock is performing, and when you are eligible to spend your ESOP cash. Final Thought Are you comfortable with your progress toward retirement? Are you confident you’ll know how to handle your ESOP diversification and distribution when the time comes? Do you need help forecasting how your ESOP and 401(k) can generate retirement income? A wealth manager from the Peak Wealth Planning team can assist. About this Series This is part two of a six-part series in which Peter Newman, CFA, of Peak Wealth Planning, explains the benefits of employee ownership for the U.S. workforce. There are more than 6,500 Employee Stock Ownership Plans, or ESOPs, in the U.S. covering almost 14 million employees. Part one is Five Key Advantages to Working at an Employee-Owned Company Part three, Five Things Employee-Owners Need to Know About Their ESOP, will arrive in November. - - - - - - - - - - - - - - - About the Author Peter Newman is a Chartered Financial Advisor (CFA) and president of Peak Wealth Planning. He works with individuals nationwide that have accumulated wealth through company stock, ESOP shares, real estate, or running a business. Peter applies his unique background to help clients achieve their specific goals and enjoy peace of mind. Peak Wealth Planning offers personalized concierge services  to meet your wealth management needs, including  financial planning, investment management, ESOP diversification, retirement income, i nsurance, and estate planning. As a fee-based  financial advisor based in Chicago, Peak Wealth Planning serves a select group of clients in Illinois and across other states .

Originally published on Kiplinger.com on November 7, 2023 . For participants, an ESOP, or Employee Stock Ownership Plan, can be an important component of their retirement income. Now that you’ve read about the benefits of company paid contributions, learned the advantages of working for an employee-owned company , and know how ESOPs work , dive into five essential questions employees should learn about their retirement benefits. 1. How much does the company contribute to my ESOP annually? Some employee-owned companies attempt to maintain contributions as a steady percentage of an employee’s salary. For example, one company might opt for 5% of a salary of $80,000, which would equal a $4,000 ESOP contribution for the year. For other companies, contributions vary each year depending on profitability. This makes it harder to forecast your future balances and may indicate a need to save more in other retirement accounts. 2. How do I know my ESOP value? While employed, a worker doesn’t directly own shares of the company. The shares are kept in a retirement account for the employee’s benefit and disbursed once a vested employee is terminated, retired, disabled or otherwise leaves the company. Employees receive a statement each year showing the number of shares and value. For example, an employee’s statement might show they have 2,100 shares with a per-share value of $85, resulting in an ESOP account balance of $178,500. 3. How has the share price changed across the past 10 years? If the share price has been increasing, chances are the company is doing well financially and your wealth may continue to grow from increases in share value. Knowing the average percentage change in share price can be used to forecast the value of your ESOP account for retirement. If you are over age 55 with a company whose shares have increased dramatically, you may want to consider diversifying a portion of your ESOP when eligible to take some risk off the table. Even companies doing well can fall on hard times. Some current and formerly employee-owned companies that have experienced significant share price increases, and created many millionaires, include Clif Bar, Amsted Industries, Inc., Murray Company Mechanical Contractors, New Belgium Brewing, and Springfield Remanufacturing Corp. to name a few. Keep in mind, most employee owners work a couple of decades to experience this type of wealth and there is no guarantee you will become a millionaire through employee ownership. So, be sure to contribute to your 401(k) and other retirement accounts. 4. When will I be paid for my ESOP? Employee owners with 10 or more years of service are eligible to get paid for their stock at age 55 (up to 25%) and age 60 (up to 50%) with the remainder in substantially equal payments over a five-year period at normal retirement age (usually 65). The timing above is common, but keep in mind that your company’s plan may have different rules. Employees receive a letter explaining how much they can withdraw and a form to indicate whether to receive a check or roll over their ESOP funds to an IRA or their 401(k). Employees should work with their financial adviser or CPA to understand the tax consequences of receiving a check vs. rolling over the funds to another tax-deferred account. And, keep in mind there could be a gap of weeks to months between requesting a payment and receiving the funds. Check with your ESOP representative on the timing. 5. What is the company match for the 401(k) plan? The majority (94%) of employee-owned companies also offer 401(k) plans. However, some will match an employee’s contribution, while others will not. When offered, this match is usually up to a percentage of salary. As an example, if an employee making $80,000 a year contributes 10%, or $8,000, to their 401(k), the company might match that amount up to 5%, or $4,000, for a total 401(k) contribution of $12,000. If your company does not offer a match, you should consider contributing at least 15% of your salary to the 401(k) each year. Stay informed about your ESOP Be an active employee-owner by staying up to date on your ESOP's performance. You can do this by reviewing your statements and participating in company meetings. Also, keep an eye on the stock price and monitor any changes in the company's financial situation so you can make informed decisions regarding your diversification options. Be sure to consider your 401(k) and ESOP account balances when forecasting your retirement income . Final thought. Are you comfortable with your progress toward retirement? Are you confident you’ll know how to handle your ESOP diversification and distribution when the time comes? Do you need help forecasting how your ESOP and 401(k) can generate retirement income? A wealth manager from th e Peak Wealth Planning team ca n assist. About this series You won’t want to miss the next article in our series, Should My ESOP be My Only Retirement Account. This will cover how to use your ESOP, 401k, IRA, and taxable brokerage account together with social security to create a secure retirement income plan. This will be published in March 2024. - - - - - - - - - - - - - - - About the Author Peter Newman is a Chartered Financial Advisor (CFA) and president of Peak Wealth Planning. He works with individuals nationwide that have accumulated wealth through company stock, ESOP shares, real estate, or running a business. Peter applies his unique background to help clients achieve their specific goals and enjoy peace of mind. Peak Wealth Planning offers personalized concierge services  to meet your wealth management needs, including  financial planning, investment management, ESOP diversification, retirement income, i nsurance, and estate planning. As a fee-based  financial advisor based in Chicago, Peak Wealth Planning serves a select group of clients in Illinois and across other states .

Originally Published on Kiplinger on March 4, 2024 . Employee stock ownership plans (ESOPs) empower employees by providing them with a company-funded account for retirement. While businesses steered by their employees often exhibit remarkable management, they, like any other enterprises, may occasionally face challenging periods or even extreme situations like bankruptcy. Kodak, Piggly Wiggly and most recently in 2023, Silicon Valley Bank , are examples that underline the importance of resilience and adaptability.  Indeed, while ESOPs present an avenue for financial growth, employees often depend on the same company for both income and retirement savings . Recognizing this, it is important to save in other investment vehicles alongside your ESOP to ensure a secure future. This article aims to guide you through a variety of account options that will bolster your retirement planning, ensuring you remain well prepared and resilient, even in the rare instance where your company-sponsored ESOP faces financial turbulence. Save in multiple accounts to enhance retirement planning When it comes to saving for retirement, diversification  is key. Your ESOP is not meant to be your only retirement savings vehicle. Having a large portion of money in an ESOP alone is restrictive and lacks diversification. By relying on just this type of plan, you may be putting too much weight on one component of your retirement plan. It’s best to have additional retirement plans in place, like a 401(k) or IRA .  401(k) plan.  A 401(k) plan  is a retirement savings plan sponsored by an employer that allows employees to contribute a portion of their income to an investment account to grow their retirement savings. Some companies provide an incentive to save with an employer matching contribution. 401(k) plans may offer pre-tax or after-tax Roth contributions for employees. Individual retirement account (IRA).  An IRA is a type of retirement savings account that allows individuals to contribute pre-tax or after-tax Roth dollars to an investment account. Roth IRAs  have significant tax benefits if certain rules are followed.  Taxable brokerage account.  A taxable brokerage account is an investment account that allows individuals to buy and sell securities, such as stocks, bonds, ETFs  and mutual funds, with after-tax dollars. Careful investment selection and management can decrease taxes on brokerage accounts used for retirement savings. The investment accounts you and your employer contribute to during your working years should grow into a nice nest egg that you can draw from during retirement. The value of that nest egg will be dependent on your annual contributions, the mix of investments and corresponding growth in each account, plus the number of years you tuck money away. Your nest egg makeup and risk to retirement income Portfolio withdrawals  are the monies taken out of your investment portfolio to generate income to meet spending needs. The value of these assets fluctuates and may not provide a predictable income stream as the assets are dependent on the performance of the underlying investments in the portfolio. With those cautions in mind, it’s still useful to estimate the income from your retirement accounts. For every million dollars you have saved at retirement, that should create about $40,000 in retirement income, according to the commonly used 4% spending rule . Your actual income will vary, but this is a rough estimate or starting point. Evaluating the value of your ESOP relative to other retirement savings amounts and portfolio holdings will show you where the benefits and risks live. Below is an example. The income projections are rule-of-thumb estimates and not guaranteed. Your income could be higher or lower depending on your retirement investment portfolio returns and whether you use a periodic withdrawal strategy or purchase an annuity. $200,000 in an ESOP could generate $8,000 in income $800,000 in a 401(k) could generate $32,000 in income In this $1 million nest egg forecast, the ESOP represents 20% of $40,000 of retirement income. In the event of a catastrophic ESOP failure, retirement income would be lowered to $32,000. Here’s another example: $3 million in an ESOP could generate $120,000 in income $1 million in a 401(k) could generate $40,000 income In this $4 million nest egg forecast, the ESOP represents 75% of $160,000 of retirement income. In the event of total ESOP failure, retirement income would be lowered to $40,000. It’s important to note that retirees can’t withdraw directly from the ESOP. The company or plan buys shares back, and ESOP participants can reinvest the proceeds into their IRA or 401(k) account. This process is called diversification and is covered in the series article How Does an Employee Stock Ownership Plan, or ESOP, Work? Secure sources of retirement income In addition to the retirement accounts discussed above, most folks will have secure income from Social Security . Secure income  refers to reliable and predictable streams of income that are unlikely to be disrupted, providing financial stability and peace of mind. In addition to Social Security benefits, your family may have additional secure income sources, such as:  Pension. A pension  is a retirement plan in which an employer or the government makes contributions to a fund on behalf of an employee. The contributions for all participants are invested and later paid out to each individual employee as income during their retirement years. Pensions usually have a formula to determine the income benefit during retirement. Annuity.  An annuity  is a financial product in which an individual makes a lump-sum payment or series of payments to an insurance company in exchange for regular payments over a set period, often used for retirement income. What to do now For many ESOP retirees, Social Security provides a stable foundation of income. Depending solely on Social Security and your ESOP may not produce enough income to meet your retirement budget. Allocating 15% of your earnings toward a 401(k) today can be a prudent step toward securing your retirement income. If your budget permits, contribute to an IRA account as well. By distributing funds across various account types, you are reducing the risks linked to concentrated stock ownership  and creating a safety net in case of future uncertainties, such as cuts to Social Security benefits or a downturn in your ESOP account value. Diversifying your retirement savings by building up a well-funded 401(k), annuity or IRA accounts can increase your chance of having a comfortable retirement . Additionally, having substantial balances in your savings account and 401(k) can serve as a contingency plan in case of job loss or unexpected company challenges. Consider taking the following four actions: Allocate 15% of your earnings toward your 401(k) account. Forecast the value of your ESOP and 401(k) account at retirement. Identify the sources of secure income you will have at retirement. Diversify your ESOP if it’s a significant portion of your retirement nest egg. As you move toward your golden years, it is worth contemplating how different income sources contribute to your income in retirement. Consider what portion of your retirement income will come from the ESOP and whether your sources of income are sufficiently diversified. This is especially important if your ESOP is a significant proportion of your net worth . Final thought. Are you comfortable with your progress toward retirement? Are you confident you’ll know how to handle your ESOP diversification and distribution when the time comes? Do you need help forecasting how your ESOP and 401(k) can generate retirement income? A wealth manager from the  Peak Wealth Planning team  can assist. Other articles in series: Pa rt 1:  Five Key Advantages to Working at an Employee-Owned Company Part 2:  How Does an Employee Stock Ownership Plan, or ESOP, Work?  Part 3: Five Things Employee Owners Need to Know About Their ESOP Part 4: Should my ESOP be my Only Retirement Account? Part 5: Coming soon Part 6: Coming soon - - - - - - - - - - - - - - - About the Author Peter Newman is a Chartered Financial Advisor (CFA) and president of Peak Wealth Planning. He works with individuals nationwide that have accumulated wealth through company stock, ESOP shares, real estate, or running a business. Peter applies his unique background to help clients achieve their specific goals and enjoy peace of mind. Peak Wealth Planning offers personalized concierge services  to meet your wealth management needs, including  financial planning, investment management, ESOP diversification, retirement income, i nsurance, and estate planning. As a fee-based  financial advisor based in Chicago, Peak Wealth Planning serves a select group of clients in Illinois and across other states .

“In the realm of financial planning, especially for high net worth individuals, the conversation leans towards tax strategies, investment management, and retirement planning. Yet, one crucial pillar frequently overlooked is insurance — a safety net that, albeit less glamorous, is fundamentally essential.” Peter Newman There are real consequences of delaying life insurance. Its existence is synonymous with death, something most people like to avoid thinking about. But in the words of Jim Morrison, “No one here gets out alive.” As the marketing director for Peak Wealth Planning, my days are filled with opportunities to educate others on the benefits of smart financial planning. Yet, when it came to certain lessons, I found myself dragging my feet on applying what I learned to my household. When my son, Sebastian, was born, my husband,Terry, secured life insurance. This gave him peace of mind knowing we would be cared for in the unfortunate scenario where he was no longer with us. When Sebastian turned 3 or 4, Terry began suggesting I also put a policy in place. Despite Terry's repeated suggestions, I procrastinated until our second pregnancy, which led to a crucial realization about the importance of insurability during life-changing events. Timing is critical with life insurance.  This situation highlighted a critical lesson about 'insurability.' Factors like age, health, and major life events such as pregnancy can significantly affect the ability to secure favorable insurance terms. For high net worth individuals, timely insurance is essential to protect assets and ensure stability for future generations. Insurance companies are cautious about issuing policies that could be subject to higher claims shortly after initiation. Waiting until after pregnancy allows the insurer to offer terms that are more aligned with the long-term risk profile of the applicant, ensuring that both the insurer and the insured are adequately protected. There is a high cost of procrastinating on life insurance. Delaying insurance can have financially and emotionally devastating consequences. Uninsured events can erode years of careful investment and saving, leaving families vulnerable at the most critical times. I am grateful my pregnancy was low-risk, but each day between being denied insurance and my delivery, I was acutely aware of the potential consequences of my procrastination.  My personal experience underscores that the best time to get insurance is before you feel it is necessary. Take immediate actions to secure life insurance. My personal experience attempting to secure life insurance during pregnancy served as a significant wake-up call. It reinforced the understanding that insurance is not merely an option, but a vital necessity for protecting your wealth, legacy, and loved ones.  Here’s how you can take action now: Evaluate Your Needs: Begin by assessing your financial risks and understanding how life insurance can mitigate them. Consult with Professionals: Engage with trusted financial advisors and insurance experts who can craft a plan tailored specifically to your needs and circumstances. Act Promptly: Don’t wait—prioritize securing life insurance early. Make it a foundational element of your financial plan, ensuring you and your family are protected before you ever think it’s necessary. By taking these steps, you can ensure your financial stability and peace of mind for the future. Don’t put off this critical aspect of financial planning. The right time to act is now. Expert Insight High net worth individuals face unique risks that necessitate a strategic approach to insurance. Beyond the basic need for life insurance, considerations for estate taxes, long-term care, and disability become paramount. Insurance, in this context, is not merely about mitigating loss but about caring for family and protecting your legacy. Are you comfortable with your progress towards retirement? How about helping future generations meet their financial goals? If you have more than $2 million saved and need help from a wealth manager, the Peak Wealth Planning team can assist.  - - - - - - - - - - - - - - - About the Author Carmen Egolf is the Marketing Director at Peak Wealth Planning. Her role primarily focuses on educating others about the importance of financial wellness for their future, while also highlighting the expertise of her colleague, Peter. He possesses a deep understanding of financial planning, which Carmen translates into digestible nuggets of knowledge. Their weekly meetings remind her of Tuesdays with Morrie  but with a financial wellness twist. By applying Peter's advice to her own life, Carmen enhances her understanding of future preparedness and generates ideas for questions, blog posts, social media posts, and presentations. Ultimately, her work centers on educating others about the benefits of thoughtful financial planning.

When I began graduate school, my father agreed to pay my rent. I had a scholarship covering tuition and a modest research stipend. However, a year into my studies, my father abruptly cut off his support, telling me, "You figure it out." This forced me to get a second job working nights at a bar to cover my expenses. Initially, I was angry because he had changed the deal on me. However, I later realized it was one of the best life lessons I ever learned. In today's world, many parents choose to support their adult children financially, but the philosophies and approaches to this generosity can vary significantly. Understanding these differing perspectives can help families navigate the complex dynamics of financial gifting and maintain healthy relationships. In this blog post, we'll explore three primary philosophies of financial gifting: parents who support their children's lifestyle, those who only support major life events, and those who focus on funding major family experiences. Financial Gifting Philosophy #1. Supporting the Lifestyle Some parents believe in providing ongoing financial support to help their adult children maintain a certain lifestyle. This approach often includes regular gifts that cover everyday expenses, luxury items, or even supplemental income to bolster their children's standard of living. Pros: Reduced Financial Stress : Regular financial support can alleviate financial pressures, allowing adult children to focus on their careers, personal growth, and well-being. Stronger Bonds : This continuous support can foster a sense of closeness and interdependence within the family. Security and Stability : Knowing that there is a safety net can provide adult children with a sense of security, encouraging them to take risks and pursue opportunities they might otherwise avoid. Cons: Dependency : There is a risk of creating a dependency, where adult children may struggle to manage finances independently. Entitlement : Regular financial gifts might foster a sense of entitlement, leading to unrealistic expectations and potential conflicts. Financial Strain on Parents : Depending on the parents' financial situation, continuous support might strain their resources, impacting their retirement or financial goals. Financial Gifting Philosophy #2. Supporting Major Life Events Other parents prefer to support their adult children during significant life events such as weddings, home purchases, a graduate degree, or starting a business. This approach emphasizes helping during critical moments rather than providing ongoing support. Pros: Encouraging Independence : By limiting support to major events, parents encourage their children to be financially independent and responsible for their day-to-day expenses. Focused Assistance : This method ensures that financial gifts are used for meaningful purposes that can significantly impact their children's lives. Budget-Friendly : Supporting only major events can be more sustainable for parents, helping them manage their own financial needs and goals. Cons: Stress During Other Times : Without ongoing support, adult children might experience financial stress during periods without major life events. Potential Resentment : If expectations are not clear, children might feel unsupported or resentful during times of need. Timing Issues : Determining what qualifies as a "major life event" can be subjective, potentially leading to disagreements. Financial Gifting Philosophy #3. Supporting Major Family Experiences Some parents choose to use their financial resources to fund significant family experiences, such as annual vacations or gatherings that include extended family and friends. This approach focuses on creating lasting memories and strengthening family bonds. Pros: Strengthened Relationships : Shared experiences can strengthen family bonds, creating cherished memories and a sense of unity. Life Enrichment : Funding experiences rather than material possessions can enrich the lives of all involved, fostering personal growth and cultural exposure. Inclusivity : This approach often benefits not just the immediate family but extended relatives and friends, enhancing the overall family dynamic. Cons: Financial Burden : Large-scale events can be expensive, potentially straining parents' finances. Unequal Distribution : Some family members might feel left out or perceive an unequal distribution of resources if they are unable to participate in these experiences. Dependence on Parents : If these experiences are solely funded by parents, there might be an expectation or dependence that could lead to disappointment if circumstances change. Key Takeaway The philosophy behind financial gifting to adult children varies widely among parents. Whether supporting a child's lifestyle, focusing on major life events, or funding significant family experiences, each approach has its benefits and potential pitfalls. Clear communication, setting expectations, and balancing generosity with the promotion of independence are crucial in maintaining healthy family relationships.  Ultimately, the chosen philosophy should align with the family's values, financial situation, and long-term goals, ensuring that both parents and children can thrive. Final thought. Are you comfortable with your progress towards retirement? Are you striking a balance between helping your adult children meet their financial goals and managing financial expectations? Have you taken steps forward on estate planning and intergenerational wealth transfer? If you have more than $2 million saved and need wealth management assistance, the Peak Wealth Planning team is here for you. - - - - - - - - - - - - - - - About the Author Peter Newman is a Chartered Financial Advisor (CFA®) and president of Peak Wealth Planning. He works with individuals nationwide that have accumulated wealth through company stock, ESOP shares, real estate, or running a business. Peter applies his unique background to help clients achieve their specific goals and enjoy peace of mind. Peak Wealth Planning offers personalized concierge services  to meet your wealth management needs, including financial planning, investment management, ESOP diversification, retirement income, i nsurance, and estate planning. As a fee-based  financial advisor based in Chicago, Peak Wealth Planning serves a select group of clients in Illinois and across other states .

“A number of Peak Wealth Planning clients are entrepreneurs. This article will help you differentiate your business from the competition and may lead to a higher price if you ever sell your business in the future”. - Peter Newman of Peak Wealth Planning Would you like to save legal fees, time and energy? Would you like to add value to your business and protect what drives customers to your company? Would you like to differentiate your business from the competition? Then, ask: Do we have an IP Strategy? An Intellectual Property (IP) Strategy is about developing inspired ideas informed by IP, protecting features most important to the consumer, and securing valuable and business relevant assets. An IP Strategy is not about simply acquiring intellectual property. Instead, an IP Strategy guides the development of intellectual property assets (IP Assets) – trade secrets, trademarks, trade dress, patents and copyrights – that help add value to a business. A successful IP Strategy cultivates IP Assets that could leave your competitors asking: How do we get around that? Intellectual Property A basic understanding of intellectual property is important prior to developing an IP Strategy and building IP Assets. Typically, one or more of the following are used to help build a business’ identity and protect its products. Trade Secrets: Confidential knowledge that is not known by others that gives your business a competitive advantage. Good candidates for trade secrets include information about your business such as your supply chain, product costs, and your list of customers. Trademarks: A word, slogan, phrase, or design that helps to identify and distinguish your business as the source of your products and/or services. A trademark option for your company or your products is one that is distinguishable from competitors but not descriptive. As a note, domain names do not go through a trademark registration process and should be considered alongside trademark registration. Trade Dress: The visual appearance, characteristics, and overall “look and feel” of a product or its container, packaging, or design, that uniquely signifies the source of the product to consumers. Patent: A government-issued property right given to an inventor to exclude others from making, selling or using their invention for a set period of time. Patents may be obtained for inventions such as products, processes or methods. Copyrights: Protects original works of authorship fixed in a tangible form. Sales literature, slide presentations and advertising copy may all be eligible for copyright protection. Intellectual Property Strategy The IP Strategy begins with a business: Thinking through where their business is, Thinking ahead to where their business is going, and Thinking around where the competition, industry and consumers may be in the future. At its core, an IP Strategy is built with the business in mind. Without an IP Strategy, investments in intellectual property may be made, often at extensive legal costs, that do not propel your business goals forward. Some businesses may develop an IP Strategy internally, but many enlist legal assistance specifically to develop an IP Strategy and expand IP Assets. When choosing legal counsel ensure they have the ability to see the larger business picture and, ideally, help you think through, think ahead and think around. Think Through Think through where your business is at, where it is going and how it may be currently distinguished from the competition. Thinking Through an IP Strategy can be by a business team simply asking whether they are protecting what is most important to customers purchasing decisions and whether there will be a competitive advantage obtained by IP protection. Understand that your goals will be unique, and will differ drastically if you are: an entrepreneur starting a business, a small business owner taking crucial first steps towards protecting intellectual property from theft, a family business growing assets for the coming generation, and an established business owner developing a profitable exit strategy through a business sale. However regardless of the stage you find your business, consider the following questions: Have you already developed IP Assets that distinguish you from the competition? Are there gaps in your IP Assets that may leave you exposed to competition? In thinking through your existing business, you will undoubtedly identify valuable intellectual property but may also see gaps. One client, although pursuing patent protection, went through an IP Strategy exercise only to find that his trade secrets were not protected and trademarks not secure. As a result of this exercise, the client quickly filled these gaps with confidentiality agreements, employee agreements and registered trademarks. Think Ahead Think ahead to where you would like your business to be in the next three to five years. As you start your business, are you developing the IP Assets that could sustain you in growth? Are you building and adjusting your IP Assets for your current business needs? As you plan to sell your business, are you formally registering the IP Assets that will make your company attractive for sale? In my experience, businesses must think ahead to acquire valuable IP Assets. One client of mine files trademark applications and domain names that they have the intention of using three (3) years in the future to insure that the names are not unwittingly used by another. Another client started well in advance of the sale of his company to begin formalizing the trademark registration process. All clients thought ahead prior to acquiring additional IP Assets. In thinking ahead, an IP Strategy will help you make the best possible decisions on where to invest your resources into IP Assets. Think Around Consider what challenges your business may encounter from competitors, new regulations, evolving consumer preferences and other outside factors. While you may have a good feel for where you are at and where you’d like to go, an IP Strategy can help challenge you to look around corners where your business and competitors may be heading. Are you doing competitive analysis to identify what IP Assets competitors may have? Such analysis can include monthly patent searches and routine trademark registration filings. Are there changes to your industry that could potentially impact your products or services? Will you be able to meet evolving consumer preferences? As a business thinks around a challenge, they put themselves in the shoes of their competitors, the changing marketplace and customers. My clients often build entire strategic planning sessions to challenge themselves to think around what may be coming around the next corner. One client who anticipated Internet of Things (IoT) filed patents on where they believed the marketplace was heading and filed a series of patent applications on where they thought the industry could go: Good news! They guessed right! Final Thought With an IP Strategy developed, you can more efficiently use the services of an intellectual property attorney to develop intellectual property assets (IP Assets) that move your business towards your goals.Instead of simply obtaining intellectual property, an IP Strategy can take tools such as trade secrets, trademarks, trade dress, patents and copyrights and turn them into valuable IP Assets for your business. The development of your IP strategy is not a single task that is completed only once. Your IP strategy should be developed and evolve over time, and you should refine your IP strategy as frequently as you evolve your business strategy. Many firms, including my own, offer a free introductory consultation regarding intellectual property. I encourage you to take advantage of this opportunity to begin evaluating where your business may be, where it is going and what the future may hold. At a minimum, please reach out to me with an email, LinkedIn message or call so I can ask: “Do you have an IP Strategy?” - - - - - - - - - - - - - - - About the Author Vince Egolf is an attorney specializing in intellectual property and technology law. With over 20 years of experience, he has the privilege of representing clients such as Whirlpool, the Wm. Wrigley Jr. Company, BISSELL Homecare and many others. Now, as the founder of Egolf IP Law, PLC, he brings these experiences to helping small to medium sized businesses grow and protect their companies. If you’ve questions, please reach out to Vince at vince@egolfiplaw.com or 616-681-1090 (text/call). Peter Newman is a Chartered Financial Advisor (CFA) and president of Peak Wealth Planning. He works with individuals nationwide that have accumulated wealth through company stock, ESOP shares, real estate, or running a business. Peter applies his unique background to help clients achieve their specific goals and enjoy peace of mind. Peak Wealth Planning provides concierge services  to meet your wealth management needs. Services includ e: financial planning, investment management, ESOP diversification, retirement income, i nsurance, and estate planning guidance. Peak Wealth Planning is a fee-based  financial advisor based in Chicago, Illinois, and Colorado.

We’re in a transition period with the economy. Markets are volatile, geopolitical pressures are driving the price of oil higher, and the US inflation rate is near a 40-year high. With inflation on the rise and a stock market influx, the Federal Reserve is working to cultivate a strong economy – one that maximizes employment and stabilizes moderate long-term interest rates – to curb inflation. In the meantime, investors that are aware of the economic shift are looking at their investments for alternative ways to weather the storm. Inflation can erode your savings . This is why you may want to include I bonds in the safer end of your long-term investment portfolio. I'm going to explain what I bonds are, what the estimated return on I bonds really are, and help you identify if I bonds are a good investment vehicle for your wealth building journey. Lastly, I’ll share how you can buy I bonds. What are Series I Bonds? Series I bonds, known simply as I bonds, are issued by the U.S. Treasury and backed by the full faith and credit of the U.S. government. This makes them pretty much the gold standard for risk-free investment vehicles. Think of the “I” in I Bonds being short of inflation. They offer investors a variable rate of return, currently 9.62%. This is based on a published inflation rate which is reset twice a year. I Bonds are long-term investment vehicles. This means your investment may not be immediately available to you once you decide to invest and you may need to pay a penalty if you withdraw your funds early. I bonds require a twelve-month commitment, so you’ll be locked from accessing those funds for one calendar year. And if you liquidate after twelve months but before 5 years, you’ll forfeit 90 days of interest. There are investment limits for I Bonds. Each person can purchase $10,000 worth of I bonds annually electronically and may purchase up to another $5,000 through their tax refund. What is the estimated return on Series I Bonds? The inflation-adjusted rate is reset twice a year in May and November, based on the Consumer Price Index. Since inflation is running hot right now, the variable inflation rate is currently paying 9.62% ! You may be thinking to yourself, “That’s amazing! 10% on risk-free government-backed security!” And you’d be right; it is amazing. However, there are several things to consider before liquidating your Bitcoin for the safety of Uncle Sam. How do I know if Series I Bonds are a good investment strategy for me? What is your time horizon? I bonds are a long-term investment. If you are prepared to not touch this money for the next 12 months minimum (and ideally 5 years to avoid any penalty), then this may be the right next step for you. What are the penalties to withdrawing money early? If held for more than 5 years there is no penalty. If you cash it in within 5 years, you forfeit 90 day of interest. How can I be confident not to touch this long-term investment? Having an appropriately diversified portfolio and adequate savings for short-term needs and emergencies will provide the confidence needed to commit to a longer term investment. If you have children or grandchildren, you may want to consider using I Bonds as an alternative investment vehicle for college savings. If the bonds are used for educational purposes the interest earned may be exempt from federal income tax. What are the benefits of I Bonds for estate planning? Savings bonds can be useful in estate planning because, on the death of the original bond owner, the co-owner or beneficiary becomes the owner. It's important to register your bonds correctly. Registrations for Series I Bonds, both electronic and paper bonds, can vary, so it's a good idea to find out how to register each type of bond. How can I buy I Bonds? I bonds are pretty simple to set up. You can go to TreasuryDirect.gov and open a free account to purchase these federally-backed securities directly from the U.S. Treasury. You can begin purchasing I bonds after you’ve created an account. Here are a few things to keep in mind. I bonds earn interest for 30 years unless you cash them in. You can do this after a year has passed from the time of purchase, but you'll lose the previous three months of interest. However, there is no penalty if you let them mature for five years or more. The maximum amount you can invest is $10,000 total per calendar year. To increase this amount, you might consider opening one account for yourself and another for your spouse or partner. Ready to invest in series I bonds? Peak Wealth Planning is happy to help walk clients through the process. Final thought. Your overall investment strategy should consider that there will be transition periods in the economy. A wise investor will have a cash reserve in a high-yield savings account to alleviate stress and worry that can come with unexpected expenses and to create a cushion for the future. If you want to build security into your long term investment plans and are curious how to integrate I bonds into your investment strategy, the Peak Wealth Planning team can assist you. Peak Wealth Planning specializes in helping high-net worth individuals and families plan for the future. - - - - - - - - - - - - - - - About the Author Nathan Gale is a CFP® professional with a Master of Science in Personal Financial Planning from Kansas State University. He joined Peak Wealth  as a Financial Planner in 2022 and is passionate about holistic financial planning and therapy. Peak Wealth Planning provides concierge services  to meet your wealth management needs. Services includ e: financial planning, investment management, ESOP diversification, retirement income, i nsurance, and estate planning guidance. Peak Wealth Planning is a fee-based  financial advisor based in Chicago, Illinois, and Colorado.

The high inflation rate is forcing the Federal Reserve into a cycle of raising interest rates. Inflation is identified by the Consumer Price Index (CPI), which measures the cost of goods and services the consumer buys. These costs can be influenced by many economical factors that often result in supply and demand constraints, leading to price fluctuations. And, when prices rise, we feel the result... that our dollar doesn’t buy as much as it did. The Federal Reserve’s job is to control inflation. By raising interest rates, the Fed hopes to slow spending and stabilize consumer prices. The main worry for economists is if the Feds raise interest rates too quickly, it will slow down the economic recovery . Final thought. Your overall investment strategy should consider that there will be transition periods in the economy. If you have any questions or concerns regarding recent events and your portfolio, let us know. We're always ready to help. Peak Wealth Planning specializes in helping high-net worth individuals and families plan for the future. - - - - - - - - - - - - - - - About the Author Nathan Gale is a CFP® professional with a Master of Science in Personal Financial Planning from Kansas State University. He joined Peak Wealth  as a Financial Planner in 2022 and is passionate about holistic financial planning and therapy. Peak Wealth Planning provides concierge services  to meet your wealth management needs. Services includ e: financial planning, investment management, ESOP diversification, retirement income, i nsurance, and estate planning guidance. Peak Wealth Planning is a fee-based  financial advisor based in Chicago, Illinois, and Colorado.

Begin 2024 with the mindset of prioritizing your financial wellness. In the spirit of National Mentoring Month , I have assembled 4 key exercises to start your year off right by prioritizing your financial wellness. Plug the Leaks in Your Expenses Creating a Budget Tracking Your Net Worth How to Set Goals to Realize Your Dreams In the previous post Plug the Leaks in Your Expenses , I challenged you to find $1,000 of savings over the next 12 months by eliminating or reducing some of your subscription costs. For this task, you had downloaded last year’s credit card statements and looked for recurring payments. With this task successfully completed, you are now ready for the next challenge –– creating your budget for the next 12 months. A budget is important for a couple of reasons. The most obvious reason to make a budget is so you’re never caught off-guard with more bills than money. However, even if you already do an excellent job of not overspending during the month, keeping a budget provides you with information regarding your spending habits. This brings your priorities into focus. Not only can this help you plan for even long-term goals, but it can inform you of what expenditures truly make you happy and which habits you could leave behind. Create Your Budget For The Next Twelve Months Experts believe that once consumers’ shopping habits are ingrained, it’s incredibly difficult to change them. This is why I am now asking you to look for your spending habits. So grab your credit card statements and review your pattern of spending. How have you been spending your money this past year? And, how do you want to spend it differently? Are you meeting your savings goals? Are you able to enjoy life or are you finding yourself always worrying about making ends meet? 1. Categorize your spending. As you review your previous 12 months of financial statements, group your spending into categories. The three categories are essential expenses, fun/discretionary spending, and planning for the future. Essentials: Shelter, Food, Health, Transportation Essential expenses are ones you cannot do without. The cost of maintaining a roof over your head, food, transportation, insurance to protect your family, and items or services needed to support your professional identity are all essential items. Make a list of your recurring monthly expenses. From this, you can pinpoint the majority of essential spending. For essential bills that are paid once a year, such as property taxes, simply divide that expense by twelve to lessen the pressure of a large but anticipated expense. How to decide what is Essential? If you ran out of money tomorrow, you would probably find a way to pay your mortgage, car payment, and cell phone before your country club bill. But to go a layer deeper, think about when you purchased your car. Did you opt for a higher monthly car payment to pay it off quicker? Even if you went with a $1,000 a month payment, you can count it as essential as long as your income still leaves room for Fun and Future spending. But, if that $1,000 a month car payment prevents you from saving for retirement, it may be necessary to reconsider your priorities. Fun or Discretionary Spending Discretionary spending are the things you can do without but makes life more enjoyable. It is a dinner date to the new restaurant downtown and a family movie night at the local iMax theater. It is purchasing apps for your iPhone and an occasional grande frappuccino at Starbucks. It is taking a week-long vacation cruise to the Bahamas and playing a regular round of golf at the country club. It is buying gifts for your loved ones and funding a car restoration hobby. Making charitable donations that improve your local community would go in the discretionary category too. These discretionary expenses are not necessary to have a roof over your head, but they add value to your way of living. Saving and Investing for the Future During your prime working years, typically age 35 to 55, it is imperative to place money aside to invest for the future. Depending on your goals, allocate 20-30% of your monthly income towards investing for the future. For each individual, the amount and goals will vary. You may be saving up to purchase an investment property, fund a child’s education, or socking away money for your retirement. Work with your trusted financial advisor to identify how much you need to save to hit each goal in your desired time frame. For example, fund in-state college tuition in 12 years. Or, take a less stressful job at age 60. Work with your trusted financial advisor to identify how much you need to save to hit each goal in your desired time frame. If you are unsure you are on pace to meet your goals based on what you’ve allocated towards each, it will be a good idea to bring the conversation to your financial advisor. After you’ve worked out your monthly budget and documented where your money is going, bring your questions and documents to your next meeting. 2. Formulate Your Budget The most important piece of advice you need to always remember is your income must be equal to or greater than your expenses. If your annual income from all sources is $350,000 (post tax) and annual expenses are $400,000. You are negative by $50,000 each year, which means you are taking on debt to meet essential and fun expenses. You may need to revisit spending habits if this is the case. Sometimes difficult choices such as downsizing your home, selling a vacation property, or driving less fancy cars should be considered. You will be happier in the long run if you have control over your spending and are investing for the future rather than winging it and hoping everything will work out for your family. For many folks, essentials will range from 40% to 60% of your monthly income. Keep in mind, the higher your essential spending, the less flexibility you have for discretionary spending and less investment for your future. Fun/Discretionary Spending may range from 20% to 30% while your Future Funds may range from 20% to 30%. There are no hard and fast rules, these are guidelines to consider. If you are older, perhaps in your late fifties, and have already saved a substantial nest egg, then your Future budget may require only 10-15% of your income and you’ll be able to increase your Fun or Essential spending. If you are in your prime earning years, between age 35 and age 55, I strongly suggest your future expenses should be 30% of your income to make sure you have a substantial amount of savings for kids’ college, retirement, and can maintain sufficient flexibility for the ups and downs of life. A friend of mine generously shared her monthly budget so I may share it with you. You’ll see how she prioritizes essential, fun, and future spending as well as the percentage distribution of her total monthly income. Her monthly income is right around $11,000 a month, so her spending pretty much matches her income. As you complete today’s exercise, ask yourself: Does your spending align with your income? 3. Evaluate Your Budget Periodically Take time each month to evaluate how your essential, fun, and future spending is balanced with your budget. Is your money meeting your current desired lifestyle while providing for your future needs? Does your Essential and Fun spending truly make you happy? Are there items you could be content without? Do you feel good about the money you are investing in your future? Keep an open dialog with your spouse/partner and family so everyone is on the same page. Do you have fluctuating income? Some folks have a fluctuating monthly income if they own a business and take occasional draws or they receive periodic bonuses or commission checks. If this is you, then read How To Budget With a Fluctuating Income . Final thought. Are you comfortable with your progress towards retirement? Would a financial couch help you stay accountable to meet your financial goals? If you have more than $2 million saved, the Peak Wealth Planning team can assist. Peak Wealth Planning specializes in helping high-net worth individuals and families plan for the future. Other Useful Resources: Even the Wealthy Need a Budget - - - - - - - - - - - - - - - About the Author Peter Newman is a Chartered Financial Advisor (CFA) and president of Peak Wealth Planning. He works with individuals nationwide that have accumulated wealth through company stock, ESOP shares, real estate, or running a business. Peter applies his unique background to help clients achieve their specific goals and enjoy peace of mind. Peak Wealth Planning provides concierge services  to meet your wealth management needs. Services includ e: financial planning, investment management, esop diversification, retirement income, i nsurance, and estate planning guidance. Peak Wealth Planning is a fee-based  financial advisor based in Chicago, Illinois, and Colorado.

The University of Illinois at Urbana Champaign (UIUC) is offering a voluntary retirement separation program to eligible civil service staff and academic professionals. The offer for eligible employees amounts to 20 weeks pay (up to $75,000). There are critical issues you should consider when deciding whether to accept 20 weeks pay in exchange for retiring early. Financial items you should evaluate: What impact will retiring early have on your income? Will you have adequate income to meet your lifestyle needs? What will your cost of health insurance be during retirement? Where will you obtain dental and vision insurance? How much life insurance do you need during retirement? How will the cost of your life insurance change? Will your social security be reduced when you draw SURS retirement income? Key deadlines: Eligible Employees must apply to participate in the SVRP during the application window beginning December 3, 2020 and ending January 15, 2021, 11:59 p.m. CST. Applications submitted outside these dates will not be considered. Eligible Employees who apply and are accepted for the SVRP must return an executed SVRP Agreements to UIUC no later than Wednesday, March 17, 2021. Visit the UI Human Resources site for the full eligibility criteria and SVRP document. Exclusive Offer: If you need assistance evaluating the financial items above, Peak Wealth Planning is offering a flat fee package to guide you through this critical decision. The package includes an expert independent evaluation of your specific options and a written recommendation. The package cost is $2,000. The cost may be applied toward Peak Wealth Planning’s annual financial planning retainer . Contact the Peak Wealth Planning team to get started today . -- About Peter Newman -- Peter Newman is a two-time University of Illinois graduate (M.S. ‘93, PhD 2003) and managed the University of Illinois Treasury for two decades. He is also a SURS participant. He is the President of Peak Wealth Planning, an independent registered investment advisor (RIA) dedicated to meeting the needs of his clients.

Article by Brian James of C.E.L & Associates, Inc. As part of Mental Health Awareness month, I’ve asked an expert to share his insights into the emotional and mental traumas that impact families during a divorce. Brian James is a divorce mediator with 26 years of experience in the field. If you’ve questions for Brian, you can find his contact information at the end of this article. -- Peter In life, next to the death of a loved one, divorce is the most stressful time in someone’s life, followed by moving to a new house or new city coming in third. Most, if not all of the people reading this blog, have experienced the loss of a loved one at some point in their lives, have a close friend who has lost a loved one and know someone who has gotten divorced during their lifetime. Though my parents divorced when I was in high school, and I moved away to college a year later, I have been happily married for 25 years, with our 2 sons in college. My father killed himself in 2002 and my mother passed away in 2019 after suffering from dementia in the final years of her life. For me, these life experiences were tragic. Though I have not personally experienced a divorce, as a Divorce Mediator in private practice in Illinois and Wisconsin, I work with people every day who are going through the divorce process and moving at the same time. “When working with clients, one of the first things I advise them is to be careful who they go to for advice, comfort, and information.” During a divorce, people experience a wide range of emotions, sometimes in the same day, such as: Shock and denial about the fact they are getting a divorce. Pain and guilt as to what they may have done to cause the divorce. Anger as to why their spouse does not want to be married to them anymore. Bargaining with yourself on how to get your ex to change their mind (be nicer, lose weight, get a better job, be a better parent, etc.). Letting go and knowing there is nothing you can do. Acceptance and ready to move forward with your life. Helping clients and their children with the emotional rollercoaster that is divorce is challenging to say the least, as everyone deals with their emotions differently. Throw in the fact they may be moving out of a house they raised their children in, have memories, realize they may have to downsize to an apartment and throw out personal items that are important to them, one can understand why divorce is such an emotional process. Finding the right people to help you work through the emotions of a divorce is critical not only for your mental health, but also the mental health of your children and your soon to be ex, especially if you have children together and need to effectively co-parent for years to come. As a Divorce Mediator, I work with clients on the “business side” of the divorce process, helping them reach parenting agreements that are good for their children and financial agreements that are equitable and make sense. If there were no emotions in a divorce, my job would be much easier. However, this is not reality in a divorce. When it comes to mental health, and how to help my clients process their emotions, though I have learned a lot in my 26 years of working with families, I rely heavily on marriage and family therapists, psychologists, co-parenting counselors, psychiatrists and religious leaders to help me help my clients. When working with clients, one of the first things I advise them is to be careful who they go to for advice, comfort, and information. Though friends, family, co-workers, the internet, books, magazines and lawyers may all be of some benefit, friends, family, co-workers and attorneys are biased and the internet, books and magazines may have incorrect information, information not relevant to your specific situation and/or the information may not even be relevant in the state you live in. Unfortunately, these resources may only make your mental health worse. For me, this is where I rely on the professionals to help my clients during this difficult time in their lives, to help them process their emotions in a productive way, see the “light at the end of the tunnel”, help them communicate better with their soon to be ex and every other emotion they have at the time. In my experience, the right mental health professional for my clients and their children makes a world of difference in how they are affected by a divorce. Do not kid yourself, everyone is affected in some way by a divorce. Even if it is amicable, civil, and you are both on the same page on how you will be co-parenting your children. Divorce is an ending of an important chapter in your life and there will be emotions surrounding it. You may not know how or when they will pop up, but they will. Any time I see someone getting overloaded, having that blank stare on their face all the time, unable to focus, crying uncontrollably, or in the first 4 stages of emotions listed above, I do not hesitate to refer them to someone who can help them. Advice for Divorcing Parents I asked for words of wisdom from professionals that specialize in counseling families and children during divorce. Below is their advice. All Major Losses Need to Be Mourned Dr. Rob Siegel, Psy.D. One of the most important factors that I would want parents who are divorcing to be aware of is that Divorce is a major loss for them and for their children. All important losses need to be grieved. All too often parents are focused on other emotions that accompany aspects of the divorce -- new freedoms, on built up resentment, and/or focus on the competitive adversarial conflict in their attempts to "win" in their divorce litigation -- but avoid the loss itself. When parents are distracted by these other emotions/aspects that accompany divorce they often have a hard time understanding their children's needs. Children are much more focused on the loss and without their parents understanding and supporting them they are vulnerable to significantly more emotional pain and turmoil. If parents can focus on the loss and seek their own support to grieve the loss of their marriage, then they can transition easier to a co-parenting relationship and be more available to help their children mourn the loss as well. I would encourage all parents to consider seeing a therapist to help them find ways to mourn the loss of their marriage. Give Children a Safe Space Alison Koehler, LCPC As a psychotherapist for over 25 years in private practice, it has become a commonplace to see children of divorced parents sit in front of me with looks of confusion, sadness, fear, anger and pain. The life these children imagined they would have is not at all what it is to them at that point. I believe the most important things parents can focus is not only how they need to continue to make their children feel safe and that things will be ok, but also to do their best in getting along with their spouse throughout the divorce process. Do not ever say or indicate anything negative about the other parent in front of your child. Do not ever involve them in the ongoing court process, emails or financials. DO talk to your kids together and during a time where there is some time to do so, like a weekend or some family time, not on a special day, holiday or birthday. Remind your children how loved they are by both parents. Make sure the focus is on routine and change things as little as possible (such as sports activities, school activities, carpooling and so on). It is a hard topic to talk about but being honest with your children about divorce can actually help them understand and heal. Kids are going to want to know what is happening or changing. Tell them what you can, but let them know nothing is set in stone. Let them know who will be leaving the home and when they will see the other parent. With that being said, they do not need to know why you are getting divorced; instead, let them know that the two of you will be happier living separately, that you have tried to make the relationship better but can’t, and that the two of you will always remain friends. That may be tough to say for some, but this is a time for parents to be selfless and say things for their kids to avoid hurt. Other Useful Resources: If you or someone you love is in a mental health crisis due to a divorce, please do not brush it off as “they will get over it”. Get help for yourself and/or assist your loved one in finding a therapist, support group, psychiatrist, etc. If you have one, reach out to your company’s Employee Assistance Program (EAP) or obtain referrals for mental health professionals in your area. The emotions someone experiences as part of a divorce do not magically disappear once the divorce is over. With that, here are some resources you may want to access if you or someone you love is in need of help: National Alliance on Mental Illness (NAMI) Better Help (online counseling services) Centre for Interactive Mental Health Solution (CIMHS ) The Lilac Tree (Divorce Support in Evanston, IL) WINGS (Domestic Violence Support in Rolling Meadows, IL) A Safe Place (Domestic Violence Support in Lake County, IL) Though this list could go on and on for multiple pages, the most important thing to remember is that mental illness does not magically go away. The only way to fight it is to seek help. - - - - - - - - - - - - - - - About the Author Brian James is an experienced Divorce and Family Mediator with offices throughout Chicagoland and Southeastern Wisconsin. The first 10 years of his professional career, Brian worked in the Criminal Justice System helping domestic violence and divorcing families resolve family conflicts and structure parenting agreements. He assisted with the healing process that took place after these life-changing events had occurred. His approach to mediation is client-driven. By aiding his clients with the resolution of their divorce issues outside of the courtroom, Brian helps create a win/win situation for all parties in a divorce. In divorce mediation, Brian helps people work through their conflicts while teaching them problem solving, empathy and self-determination, while at the same time, giving them the ability to make informed decisions for themselves. When confronted with a conflict, if Brian’s clients refer to what they learned in mediation, he believes they will be much better off and be able to resolve their conflicts on their own. To learn more about the divorce mediation process, please contact him at his C.E.L. and Associates, Inc. office by calling (312) 524-5829 or visit his website, www.yourdivorce.org .

Guest post by Danny Iniguez Your health and wellness goals are much like monetary investments – you stay disciplined and make short-term decisions, sacrificing immediate gratification for long-term benefits. When we were teenagers, we wanted the nice stereo, latest fashion brands, or maybe saved up for the nice car. For all intents and purposes, they were to impress someone, show status, or just crank up our favorite music on our high-end sound system. Now that we are older, we can look back on how unimportant those things were, wishing we had used our money a little more wisely. Think about how much we would have acquired in interest or stocks at this point of our life if we just put some, or all, of our earned income into some type of long-term investments. Delayed gratification can usually lead to long-term benefits. The exact same can be applied to wellness, exercise, and all things that encompass healthy living. Sure, it would be great to have pizza or a cheeseburger with fries from your favorite restaurant every night, but that isn’t going to have very good long-term results for your body. So, if you haven’t already clicked away because you hate the idea of giving up a hefty plate of chicken wings and nachos and you will consider investing in long-term health, grab your kale shake and multivitamins as I give you my 5 key points of advice for anyone looking for quality of life for many years to come. 1. Train to Build Strength and Muscle Not everyone has the genetics to be a bodybuilder, and it can be discouraging watching someone pump iron and see what seems like instant results. But everyone can grow muscle, improve their appearance, and feel better if they strength train. And this is even more important as we get older because at a certain point, your body starts to lose muscle, along with bone density and other things. There is nothing we can do about this process as time affects us all the same way, but we can slow and delay the process. Simply put, the more muscle you have on your body, the longer it lasts. You may not be as strong and muscular year to year, but you still have plenty to enjoy throughout your life if you put in the effort to add muscle mass to your body as early as you can for as long as you can, then maintain it to the best of your abilities. Think of working out and adding muscle the same way you look at your retirement fund – you don’t know how much you will need later, so you should get as much as you can in your account as possible so you can enjoy it without worry. 2. Do Cardio to Build A Healthy Heart If you are already a gym rat/gym bro/gym aficionado, you already know the importance of resistance training (or maybe you just enjoy it for the aesthetics). But we can’t and shouldn’t neglect cardiovascular work. When I first got into the gym, there was a myth that permeated the “bros” thought process about how cardio “kills your gains.” Simply put, if you did cardio, any cardio, you would lose that hard earned muscle you built, or worse yet, keep you from building it. “It’s the difference between finishing 18 holes on the golf course and sitting in the shade of the cart to cool off while your friends keep playing.” Maybe I was misinterpreting it due to my youth and lack of experience and education, but there are a lot of people who believe some form of that myth, and it allows them the excuse to not do cardio. In reality, cardio is just as important for maintaining long-term health and quality of life. Having your heart conditioned to physical stress allows you to do more of what you love and keep moving. It’s the difference between finishing 18 holes on the golf course and sitting in the shade of the cart to cool off while your friends keep playing. Keeping your heart conditioned and healthy is vital to many aspects of a long healthy life. Do it as much as you can at even the most moderate intensity. Your heart and health will thank you for it. 3. Work on And Keep Your Flexibility Stretching is one of those things that seems exclusive to certain people. The yogis doing headstands shaped like a pretzel, the gymnast whose bodies defy the laws of physics, the random person, who never stretches but seems to be able to put their palms to the floor (my sister was annoyingly this way). It can be discouraging. I hated stretching when I was younger. I could never touch my toes to save my life. And do not get me started on the sit and reach test at school. I felt discriminated against for not only being overweight, but inflexible too. Now that I am older, wiser, and, fortunately, educated in kinesiology, I put just as much effort into stretching as I do everything else. When you are as active as I am on a daily basis and nurse as many injuries as I have had, it becomes vital. My body doesn’t behave like it used to. Things get stiff, tight, painful, and don't let me move like I want to. Stretching is in my daily routine in some way shape or form, and it should be in your routine too. I don’t recommend taking a yoga class right away as most are too advanced for the average non-yogi. It can also be discouraging seeing how easy stretching comes to certain people who have essentially dedicated their life to practicing yoga. Start simple but be consistent. My advice: start simple, but be consistent. Do some basic stretches. Toe touches, standing quad stretches, chest, neck, and shoulder stretches. Basically, anything you can do without equipment and in the comfort of your own home will do. Begin with at least 60 seconds or longer depending on tightness (trust me, you’ll know). Take it a step further and do them after workouts when the body’s temperature is elevated and muscle tissue is more pliable. Incorporating them post-workout will feel amazing. Do them in the morning, during lunch, and even before bed. I personally don’t think the average person can stretch too many times a day. Stretching is the easiest part of the workout to skip. You’re usually in a rush and usually just don’t feel like doing it. All of my clients are mandated to stretch after their workouts. We have an entire segment of time dedicated to this during our sessions. So, make it a priority and carve some time out. You will feel better, help prevent injury, and be able to move more. 4. Eat Your Vegetables One of my favorite coaches has a saying I will paraphrase – “Eating healthy is simply not eating like a child; Avoid sugary cereals, pastries, sodas, candy, chips, and eat your vegetables” – my favorite coach. I think he hits the nail on the head with this. People overcomplicate things when it comes to eating healthy. They don’t want to give up the things they enjoy, so they find some miracle diet that will make it simple for them. Keto, vegetarian, carnivore (yes, a diet that is all meat does exist), paleo… The list goes on and on. I won’t get into the arena of nutrition as it is a perilous environment that is unforgiving if you dare go against the ideology of any of the different schools of thought. But I will say this – if you can focus on one thing, start by eating more vegetables. Eating more vegetables will put more volume of food with less calories in your stomach which will keep you feeling fuller. Feeling fuller with less calories will allow you to lose body fat without much effort. Then there are the vitamins and minerals you will be getting. These micronutrients are vital to a lot of processes in the body that help with exercise, energy levels, and feeling better all around. Sure, eating veggies doesn’t seem very fun, but it will make a huge difference in how much enjoyment you get in life. 5. Start NOW It’s never too late – that is my philosophy when it comes to health and wellness. No matter how far you have gone in becoming unhealthy or overweight, you can always reverse the negative effects of neglecting your body. But you have to start now. The farther you let your health go, the longer it will take, and the harder it will be to undo the damage. And, to be frank, you will eventually run out of time to make those changes. Investing in your health now will allow you to live to its fullest. It isn’t the easiest thing to do, but nothing worth having is. Start now – for you and your loved ones who want to see you healthy and happy. What is the point of retiring wealthy if you don’t feel well enough to enjoy it? As an extra incentive, Peak Wealth Planning readers in the Champaign area may enjoy a complimentary fitness consultation at Raw Fitness, including a free health assessment, consult, and 30 minute trial training session while checking out the Raw Fitness facility. Final thought. If you have been motivated to improve your health, consider improving your wealth by starting now. Reach out to Peter Newman of Peak Wealth Planning. - - - - - - - - - - - - - - - About the Author Danny Iniguez is a Certified Personal Trainer through the National Strength and Conditioning Association and is the owner of Raw Fitness Personal Training in Champaign, Illinois. He has been in the gym for 25 years, 10 of which have been professionally. He has experience in strength training, powerlifting, strong man training, competed in marathons, mixed martial arts, dance fitness, and everything in between. Danny's experience includes training youth, special populations, seniors, and general populations. Having once been obese at 267 pounds and losing 70 plus pounds at one point, his goal is to share the success feeling and benefits of becoming a healthier person with anyone who wants to change their life. You can contact Danny at danny@rawfitnes.us . - - - - - - - - - - - - - - - About Peter and Peak Wealth Planning Peter Newman is a Chartered Financial Advisor (CFA) and president of Peak Wealth Planning. He works with individuals nationwide that have accumulated wealth through real estate, concentrated stock ownership , or running a business. Peter applies his unique background to help his clients achieve their specific goals and enjoy peace of mind. Peak Wealth Planning cares as much for your health as your wealth. What is the point of growing your wealth if you can’t enjoy it? So throughout the month of February Peak Wealth Planning will be dedicating its efforts towards bringing valuable insights into decreasing your risk of heart disease.

Guest post by Scott Vincent Learning of complications to your heart’s health can put you on a roller coaster. When a doctor mentions heart disease, you can be jolted from a mindset of uncomplicated living into the possibility of having your time cut short. Gratefully, I’ve always enjoyed roller coasters with their interesting twists, turns and the unexpected. My heart’s health is complicated by cardiac sarcoidosis . Sarcoidosis is an uncommon, autoimmune disease which can affect many different organs and, in my case, has caused heart failure. It has been especially difficult for me to acknowledge my diagnosis; however, I have come to appreciate the ride. I hope that a few of my experiences and learnings may help you. If it were not for my diagnosis, I would not have learned to enjoy and savor the moments that life is giving me. Be True To Yourself, Your Heart, and Your Heart’s Health I find comfort knowing that I value myself and family, value the heart that I have, and do everything I can to help the heart I have stay strong. Nobody would ever choose an impersonal fact of a health disease diagnosis. However, addressing these positive feelings puts me in the right frame to address challenges that may come regarding my health. If it were not for my diagnosis, I would not have learned to enjoy and savor the moments that life is giving me. Plan Ahead With Life and Disability Insurance Nobody brings their hat or sunglasses onto a roller coaster, you ensure that they will not fly off of you by leaving them at the beginning of the ride. Similarly, I was fortunate to have guidance to buy additional life insurance and disability insurance when I began my family. Outside my employer’s benefits, I bought a 20-Year Term Life Insurance Policy after getting married and then renewed the policy prior to the birth of my son. Moreover, I purchased personal short-term and long-term disability insurance in case I could no longer work. While the policies seemed unlikely to be needed at the time, it gave me some security and peace of mind knowing my family would be protected in the event I could no longer provide for them. When the unexpected diagnosis happened, this was one area I felt happy that I had done correctly because new insurance options were either not available or cost prohibitive. Pivot after your Diagnosis Sometimes you have to switch from riding in the front of the train to the back. Upon diagnosis, I changed from relying on life insurance for security to the mentality of building assets. I gave myself a timeline of the term of my life insurance to build assets that would replace the value of the policy. To do so, I have used at least the following tools: 1. Maxing out 401K contributions. I have maxed out traditional 401K plans and Roth 401K plans to provide security that my wife and son will be financially provided for. 2. Custodial Roth IRA for my son. Growing up on a family farm, I fully support employing my son in our family business. My son actively participates in our business to earn enough money to file his own tax return and to convert his earned income into a Roth IRA each year. I take special comfort in knowing that the investment that I help guide him to make at this early age could grow tax-free until his retirement. 3. 529 contributions toward my son’s college education. At a minimum each year, I contribute to my son's 529 by investing an amount that provides state tax benefits. 4. Diversifying income streams. While a corporate position provides many benefits, I have also developed different revenue streams from real estate to business. Bring a Balanced Intensity to Your Career Before my diagnosis, I had ambitious career goals. I still have these goals but my approach to meeting them is different. Before, I thought the goals could be met with endless hours at the office; however, now focusing on my heart’s health, focus is on intensity not endurance. I no longer put myself in a position to over-promise and under-deliver. Instead, when I take on a project, it is to deliver the best possible results. While there can still be an uncertainty to how long many projects may take, I know that the effort I put into them is intentional and focused. Find Ways to Achieve Your Life Goals Before my diagnosis, I had ambitious life goals of growing as a family, traveling, helping my son’s college education and seeing my son build a family of his own. These goals have not changed but instead have become actionable. For example, instead of simply having a goal of growing as a family and traveling, I have loosened my grip on accumulating wealth to make room for creating memories with my family. Now, my priorities are focused on my immediate family, my parents, and my siblings’ families. “While it is not a ride that I may have hopped on if I knew the layout of the track, I trust the engineer behind the design.” While it is not a ride that I may have hopped on if I knew the layout of the track, I trust the engineer behind the design. I have never asked for an easy life, but instead an interesting one. The architect of my life has not disappointed and has given me ample opportunities to turn a diagnosis of heart failure into one where I can achieve all of my life goals with intentional creativity with a focus on my heart’s health. - - - - - - - - - - - - - - - About the Author Scott Vincent is an attorney working to maintain work-life balance. He is a former marathoner having placed in the Marine Corps Marathon and raced in the Boston, Chicago and Milwaukee Marathons. He has his eyes set on continuing to participate in road races that are much shorter in 2021 and go the distance with cardiac sarcoidosis for another 50 years. About Peter and Peak Wealth Planning Peter Newman is a Chartered Financial Advisor (CFA) and president of Peak Wealth Planning. He works with individuals nationwide that have accumulated wealth through real estate, E SOP , or running a business. Peter applies his unique background to help his clients achieve their specific goals and enjoy peace of mind. Peak Wealth Planning cares as much for your health as your wealth. What is the point of growing your wealth if you can’t enjoy it? So throughout the month of February Peak Wealth Planning will be dedicating its efforts towards bringing valuable insights into decreasing your risk of heart disease.

Content originally published on the EsOp Podcast on January 16, 2024. In The EsOp Podcast Episode 264, Part 2 of 3, we embark on our most in-depth exploration yet into the world of Diversification and Distributions. I'm Bret Keisling, and I'm thrilled to once again be joined by Peter Newman, the founder of Peak Wealth Planning. Together, we unravel the intricacies of ESOP (Employee Stock Ownership Plan) diversification and distributions, shedding light on critical considerations that can shape the financial journey of employee owners. Part 2: Navigating ESOP Diversification and Distribution ESOP plans offer participants the opportunity to diversify their holdings by selling some of their shares back to the company at various points before retirement. In this episode, Peter Newman provides a comprehensive overview of the factors that play a role in the decision to diversify or not. These factors encompass tax implications, the holistic management of one's portfolio, and the broader financial context. Peter's expertise guides us through the complex landscape of diversification, offering valuable insights that empower employee owners to make informed choices. The decision to diversify isn't one-size-fits-all; it requires careful consideration of individual financial goals and circumstances. Planning for Post-Employment Life As employee owners prepare to use their ESOP distributions for a successful retirement, Peter shares essential considerations for post-employment life. It's not just about accumulating wealth but also about strategically utilizing those assets to create a fulfilling retirement lifestyle. To hear the full interview with Peter Newman and gain further insights into successful retirement planning, please check out The EsOp Podcast Episode 264 on SoundCloud. Final thought. Part 2 of our deep dive into ESOP diversification and distributions equips employee owners with the knowledge and insights needed to navigate this critical aspect of their ESOP journey. Peter Newman's expertise illuminates the path forward, ensuring that individuals make well-informed decisions that align with their unique financial goals and aspirations. For access to the full podcast episode and additional resources, visit The EsOp Podcast's website. Stay tuned for the final installment of this enlightening series as we delve deeper into the world of ESOPs and financial wellness. Thank you for joining us on this educational journey! - - - - - - - - - - - - - - - About the Author Bret Keisling has been involved in ESOPs and employee ownership since 2008. From 2009 to 2012, he served as the CEO of a 100% ESOP company. In 2012, he co-founded Capital Trustees, a boutique ESOP fiduciary firm, where he held the position of managing director. Since 2017, Bret has been the host of The ESOP Podcast, a twice-weekly show internationally recognized for its passionate coverage of employee ownership. Additionally, he produces The Owner to Owner Podcast for the EO Podcast Network. In 2019, Bret Keisling sold his interest in the trustee firm and established The Keisop Group. The Keisop Group provides consulting and various services to a wide range of employee-owned companies and those considering a transition to employee ownership. You can contact him at bret@keisop.com for inquiries.

Content originally published on the EsOp Podcast on January 9, 2024. In The EsOp Podcast Episode 263, Part 1 of 3: "Successful Retirement Planning," Bret Keisling is joined by Peter Newman, the founder of Peak Wealth Planning, a boutique financial advisory firm specializing in high-net-worth individuals with a strong emphasis on employee ownership. Together, they explore the key considerations that go into planning for a successful retirement. Part 1 covers the shifting perspectives for a secure retirement. In this opening episode, Peter Newman delves into the essential factors that individuals should take into account as they embark on their retirement journey. One striking point he makes is that many employee owners may retire with a nest egg that generates more income than their previous salary. It's a remarkable feat, but it also calls for a shift in mindset. Peter emphasizes the importance of transitioning from a focus on merely saving for retirement to designing and funding a retirement lifestyle. He underscores how the financial decisions made and implemented during one's career can have a profound impact on the quality of life in retirement. Part 1 provides a valuable introduction to the broader discussion of retirement planning, setting the stage for deeper exploration in subsequent episodes. To hear the full interview with Peter Newman and gain further insights into successful retirement planning, please check out The EsOp Podcast Episode 263 on SoundCloud. Final thought. Planning for retirement is a complex and multi-faceted journey, and Peter Newman's expertise, as shared on The EsOp Podcast, offers invaluable guidance. As we look forward to Parts 2 and 3 of this enlightening conversation, remember that achieving a successful retirement requires more than just amassing wealth; it involves crafting a tailored strategy that aligns with your unique goals and aspirations. For access to the full podcast episode and additional resources, visit The EsOp Podcast's website. Stay tuned for more insights on retirement planning in the upcoming episodes! - - - - - - - - - - - - - - - About the Author Bret Keisling has been involved in ESOPs and employee ownership since 2008. From 2009 to 2012, he served as the CEO of a 100% ESOP company. In 2012, he co-founded Capital Trustees, a boutique ESOP fiduciary firm, where he held the position of managing director. Since 2017, Bret has been the host of The ESOP Podcast, a twice-weekly show internationally recognized for its passionate coverage of employee ownership. Additionally, he produces The Owner to Owner Podcast for the EO Podcast Network. In 2019, Bret Keisling sold his interest in the trustee firm and established The Keisop Group. The Keisop Group provides consulting and various services to a wide range of employee-owned companies and those considering a transition to employee ownership. You can contact him at bret@keisop.com for inquiries.

Guest post by Emily Laugesen and Monique Rivera of Krannert Center for the Performing Arts Krannert Center at the University of Illinois Urbana-Champaign campus is more than a venue for the performing arts. It serves as a classroom, laboratory, and public square in its mission to ensure that the arts are accessible to everyone. The Krannert Center serves its community as a locus of education, human connection, and innovation in the performing arts. Here are a few ways Krannert Center builds community through the arts. Krannert Center Youth Series The Krannert Center Youth Series (KCYS) is dedicated to sharing the life-affirming power of the performing arts with school communities throughout central Illinois. Formed in 1982 through a visionary collaboration with Children’s Theatre Incorporated and Krannert Center, the Youth Series has touched the lives of more than 360,000 young people in its 39-year history. Children who grew up participating in the Youth Series are now sharing these remarkable experiences with their own students. When the COVID-19 pandemic led to the canceling of many upcoming Youth Series productions last year, Krannert Center staff shifted to virtual performances that strived to deliver the same engaging and meaningful experiences that live performance brought. CONTRA-TIEMPO Krannert Center Youth Series offered a full-body movement class and performance with CONTRA-TIEMPO, a bold, multilingual, Los Angeles-based dance company. This free class had been designed for all ages and levels of ability. It was offered via Zoom in February 2021. CONTRA-TIEMPO will return to Krannert Center for a live, immersive dance experience at the Colwell Playhouse on November 18. ¡Viva la Cultura! by Las Cafeteras Krannert Center Youth Series presented a recorded performance of ¡Viva la Cultura! by Las Cafeteras for free and on-demand during March 2021 to the local CU educational community. Through this virtual musical storytelling adventure, Las Cafeteras delivered Afro-Mexican beats, rhythms, and rhymes with inspiring lyrics that tell of a community seeking love and justice in the concrete jungle of Los Angeles. Las Cafeteras will return to Krannert Center for a live, immersive dance experience at the Colwell Playhouse on November 18. KCYS Digital Subscription Service for the Classroom In its mission to create meaningful art encounters for children, the Krannert Center Youth Series has worked to develop materials to engage classrooms with a breadth of genres in the performing arts while providing supporting materials for educators to help navigate today’s youth towards deeper intercultural understanding. Study guides and curricular materials invite students to expand their understanding of the artists and art forms and to explore their own creativity through unique and engaging classroom activities. Upcoming Events: These events are available for classrooms and homeschool groups with a subscription. Sunny Days, Insect Hands, and Night Tree by Second Hand Dance: Second Hand Dance, a disabled-led dance company that creates bold, accessible, and sensory dance experiences for children and adults, bring subscribers three performances entitled Sunny Days, Insect Hands, and Night Tree, which will inspire children to get moving and go outside (Recommended for grades PreK-2 and available through November). The Snail and The Whale by Tall Stories: Internationally recognized for its exciting blend of storytelling theatre, original music and lots of laughs, Tall Stories brings to life the story of The Snail and the Whale (Recommended for grades PreK-2 and available through November 2021). Stories of Oceania by the Honolulu Theatre for Youth: The Honolulu Theatre for Youth brings the story of Kapili, a student at a new school, who learns about respecting and honoring people of different cultures through the stories of his classmates in Stories of Oceania (Recommended for grades 3+ and available through November). The engagement staff at Krannert Center is looking forward to bringing back live and in-person performances to the Krannert Center Youth Series in 2022. Dance for People with Parkinson’s In collaboration with the Mark Morris Dance Group, the Unity Parkinson’s Disease Support Group, Carle Clinic, and the Department of Dance at Illinois, Krannert Center developed the Dance for People with Parkinson’s workshop. Led by Dance at Illinois instructors, Laura Chiaramonte and Kate Insolia, this workshop explores gentle movement in a safe, welcoming environment for those living with Parkinson’s. Set to uplifting, familiar music, this class provides a full-body workout that can assist with the preservation and improvement of balance, flexibility, and strength. Since the pandemic, this monthly workshop has moved to Zoom and now offers the fellowship of communal dance from the comfort of your own home. The next Dance for People with Parkinson’s workshop will be held on December 3, 2021. Parable Path CU The Krannert Center and several Champaign-Urbana libraries have united to bring community members together for a compelling community reading of Octavia Butler’s Parable of the Sower. Parable of the Sower (1993) is an award-winning work of dystopian science fiction that explores the physical and spiritual journey of African American teenager Lauren Oya Olamina who searches for freedom as she navigates an unstable society devastated by climate change and social inequality, among other life-changing experiences. The original book by Butler, now considered a pioneer of Afrofuturism, has since been adapted as a graphic novel by University of Illinois alumni John Jennings and Damian Duffy. Both versions of Parable of the Sower will be available to participants for use during the 14-week community read. Community members can join a book club or reading group hosted by any of the collaborating libraries to participate in group discussions either in-person or via Zoom. Learn more about this Series: Future Spaces in Community Places: This art exhibit invites community members to experience the Afrofuturism art genre. Featuring works by Stacey (BLACKSTAR) Robinson, Shaya (Chocolate Star) Robinson, and Kamau (DJ KamauMau) Grantham. This exhibition will be on view in the Murphy Gallery of the University of Illinois YMCA until December 17, 2021. Community Book Read of Octavia E. Butler’s Parable of the Sower: Join a reading group hosted by a collaborating library near you and participate in discussions to build a stronger reading community together! Various locations and groups hosted from September 27, 2021, to January 14, 2022. Opera Octavia E. Butler’s Parable of the Sower: As an endcap to this experience, Parable Path CU invites the community to view Octavia E. Butler’s Parable of the Sower by Toshi Reagon and Bernice Johnson Reagon. This work of political theatre explores gender, race, and the future of human civilization while bringing musical life to Butler’s genre-defying original novel. This live performance is hosted at Krannert Center for the Performing Art’s Colwell Playhouse February 25-26, 2022. Help Krannert with its mission. Krannert Center for the Performing Arts is able to pursue this important public engagement work and make an impact in the local community and beyond because of the spirited generosity and steadfast commitment of its supporters. Donations to the Center go beyond supporting visiting artist performances and free events. They provide critical funding to pursue initiatives that build towards an equitable and more preferable future for all. If you would like to learn more about how to make a gift to enact these positive changes in our community, please visit KrannertCenter.com/Give. - - - - - - - - - - - - - - - About the Author Emily Laugesen, Co-Director of Engagement, Krannert Center for the Performing Arts Part of the Krannert Center staff since 2009, Emily is endlessly fascinated by the power of the arts to bring people together through shared experiences. Her work with arts engagement is focused on creating opportunities for intercultural exchange, personal and professional growth, and community development. She is program director and collaborative curator of the Krannert Center Youth Series, a series of performances by professional touring artists designed to nurture creativity in students preschool through high school. Monique Rivera, Co-Director of Engagement, Krannert Center for the Performing Arts Originally from Key West, Florida, Monique earned a bachelor’s degree in Spanish from Florida State University and honors in French language and phonetics while studying at L’Institut Catholique in Paris, France. She holds a Master of Library and Information Science (MLIS) from the iSchool of Illinois. In 2006, she joined the University of Illinois and served as the senior program coordinator in the Office of Diversity, Equity, and Access. Currently, Monique serves as co-director of engagement at Krannert Center and is the course administrator for FAA 110: Exploring Arts and Creativity.

Guest post by Matthew Hausman, Executive Director of Feeding Our Kids If there has been any silver lining to the COVID-19 pandemic, it has been the outpouring of support that Americans have shown to those in need. In 2020, Americans gave a record $471 billion to charity, an increase of 5% over the previous year (4% when adjusted for inflation). Americans also donate an even more precious resource, their time. In 2018, Americans volunteered almost 7 billion hours. This investment of time and money has a tremendous impact on the local community, reaping both short-term and long-term gains for all of us. Whatever cause or interest may be close to your heart, there is likely an organization working to make a difference in that field. And all these groups could use your support in one way or another. Nonprofit organizations and community programs do as much as possible (and they do an incredible amount) with extremely limited resources. While they may qualify for government funding and have some staff, it is the support from donors and volunteers that allows these organizations to have a far greater impact than they ever could otherwise. How Feeding Our Kids Creates an Impact In the case of Feeding Our Kids, where I serve as Executive Director, we are currently serving weekend food bags to about 1,000 children at almost 40 schools and programs across Champaign Country in a given week. We do not receive any government funds to do this, and our entire staff consists of only 3 part-time paid positions, along with 3 part-time unpaid student interns. There is no way we could feed so many children in so many places without the more than 300 volunteers that unload delivery trucks, pack the food bags, and take the food bags to the schools (and this does not include the heroic school and program social workers that identify the children and get the food to them each week); or the more than 200 donors that allow us to purchase over 50,000 pounds of food. It is a cliché to tell volunteers and donors that we could not do it without them, but it is a cliché because it is absolutely true. Food insecurity contributes to poor academic performance which perpetuates the cycle of poverty. By alleviating that barrier of food insecurity, we are supporting their future development, hopefully breaking out of that cycle and contributing to long-term benefit for them and the community at large. Thanks to the support of these generous people, we are able to help children worry less about being hungry, and instead, they can focus on being students. Food insecurity contributes to poor academic performance which perpetuates the cycle of poverty. By alleviating that barrier of food insecurity, we are supporting their future development, hopefully breaking out of that cycle and contributing to long-term benefit for them and the community at large. All thanks to the giving spirit of local donors and volunteers. One of our donors encapsulated that spirit when responding to our yearly survey this spring: “I want the children to know their community loves and supports them even though we have never met.” “I want the children to know their community loves and supports them even though we have never met.” - Feeding Our Kids Donor Local Organizations All Around You Make a Difference Outside of Feeding Our Kids, I am fortunate to be able to be involved in other organizations as well, and these have given me insight into the impact that other local groups have in our community. Local groups, just like us, depend on the generous donations of time and money from our neighbors. Just in the span of a few recent days, I was reminded of how much these gifts improve our community. I took advantage of a recent beautiful fall day to enjoy some of our local natural resources and visited the Lake of the Woods and River Bend Forest Preserves. While the Champaign County Forest Preserve District, and other local park districts, are mostly funded by tax dollars and have paid staff, those resources only go so far. Volunteers are critical to help with a variety of activities such as serving as guides, helping with displays, maintaining trails and gardens, and removing invasives, among many others. Since tax dollars are primarily used for standard operations, many projects and improvements are financially supported by donations. In fact, the covered bridge at Lake of the Woods, a local landmark, needs a new roof soon and fundraising efforts are just beginning. A few days after my afternoon spent in nature, I was at a meeting where I listened to a presentation from a group called Hospice Hearts, which takes in animals from people who are no longer able to care for their pets due to their own health concerns. During the presentation, a touching story was told about a woman who was entering hospice and extremely worried about what would eventually happen to her dogs. She called the organization every day to check on her pups. When she eventually learned that her fur babies had found a loving home, her last worldly concern had been addressed. This amazing group, which is completely volunteer-based, were able to give this woman peace of mind in her final days and give her dogs a wonderful new home. Only a few hours after hearing that story, I was in a different meeting and heard another testimonial about the incredible impact that dedicated people can have on our community. Representatives from the Champaign County Community Coalition and the Don Moyer Boys and Girls Club shared a recent news story of a local young man who had started his own business and was now striving to be an example to many of the local youth he knows. Only a few years ago, while a teen, this inspiring young man was on a vastly different path. The amazing staff and volunteers involved in these youth outreach efforts helped to mentor him and turn a potential statistic into a success story. There are many similar organizations in the community that need donations, and even more importantly, volunteers and mentors, to help create even more of these success stories. These are but a few of the ways that you can help to improve our community by sharing your time and treasure. Not that you needed any more of a reason, but there are returns on investment for the giver as well. Donating and volunteering can help to lower blood pressure, increase self-esteem, and relieve stress, among other health benefits. Commit to Making a Difference While the past couple of years have proven to be extremely difficult, it has also given us the opportunity to reflect on what is important and how we can help one another and our community. And the greatest part about giving is that whatever your interests, there are so many opportunities and ways to do so. I encourage you to find an opportunity to make a difference. Get started below. Consider supporting Feeding Our Kids: Sign up for our volunteer opportunities and/or make a secure online donation. Use United Way of Champaign County to connected with different organizations in the community. Look for one (or more) opportunities that speak to your heart. If you are retired and looking for a supportive group that can introduce you to various organizations that could use your help, check out the local Retired & Senior Volunteer Program. Final Thought. Time and money are extremely limited and precious resources. We should make sure that how we spend and invest them provides as high a return on investment as possible. When you see how your gift has improved the local community, helped a neighbor in need, or touched a life for the better, what can be more valuable than the knowledge that you made a difference? - - - - - - - - - - - - - - - About the Author Champaign County native Matthew Hausman has served as Executive Director of Feeding Our Kids for the past two and a half years. He also serves as a member of the Champaign County Mental Health Board and the Champaign County Forest Preserve Friends Foundation Board and is an active member of Champaign West Rotary. Prior to moving back to Champaign County, he studied Nonprofit Management via UCLA Extension and spent a year and a half traveling the world, working with more than a dozen volunteer programs. Feeding Our Kids was founded in 2013 by two local mothers, Ann Kirkland and Jenelle Thompson-Keene, to help support some of their children’s schoolmates. The organization provides nutritious weekend food bags to children suffering from food insecurity at home. After initially serving 18 children in 2 schools, the organization has since grown to support more than 1000 children in more than 40 different schools and youth programs across Champaign County.

Happy National Chili Day! As a special treat for you, I'm sharing with you one of my absolute favorite cool weather dishes. This chili is healthy comfort food that only takes about 30 minutes to prep and 60 minutes to cook. We enjoy making it in the fall or winter when craving a hearty meal. Feel free to substitute other lean ground meat if you do not like turkey. Recipe below, or if you prefer to print - this is a printer-friendly PDF. Prep time: 30 minutes Cook time: One hour Serves 8 people INGREDIENTS: 1lb 93% lean ground turkey 1- 15 ounce. cans red kidney beans 1- 15 ounce can black beans 1- 15 ounce can whole kernel corn 1- 28 ounce can crushed tomatoes 1- 16 ounce can tomato sauce 2 - green peppers 1 - large onion 5 cloves garlic 2 Tbsp olive oil 1 tsp salt 1 tsp black pepper 1 tsp red pepper flakes +/- 4 Tbsp chili powder SERVING RECOMMENDATIONS French bread Brie cheese Shredded cheddar cheese DIRECTIONS: Chop onion, garlic, and green peppers. Open, drain, rinse kidney beans and black beans. Open corn and drain. Heat olive oil in a stock pot. Cook onions, garlic and ground turkey over medium heat in olive oil until onions are translucent. Stir to cook evenly. Add salt, black pepper, red pepper flakes. Add green pepper and continue cooking until peppers start to soften. When turkey is browned, add kidney beans, black beans, and corn kernels. Add chili powder. Pour in crushed tomatoes and tomato sauce. Stir mixture together. Let cook on medium heat until the chili bubbles in the pot. Turn down to a low heat to let simmer. After about 15 minutes, stir and season to taste. Adjust seasoning to your liking. Let simmer for another 45 minutes. While chili is finishing, toast french bread and let brie come to room temperature Serve in a bowl and top with shredded cheddar cheese. Include toasted french bread and brie on the side.