Divorce Q & A

submitted by Carla V. Risoldi, LLC, risoldilawoffices.com

Q.  I have two children with my estranged girlfriend.  She is threatening to take the children and move to Florida.  What are my rights?

A.  She cannot simply move away with the children. Instead, unless you agree to the move, she will have to file papers with the court to seek permission from the court to relocate with them. Also, there is a strict procedure for this that she must follow which involves her giving you prior notice of her intention to relocate. You will have a limited time to file papers with the court to state your opposition to the intended move, and if you do not do so in time, then you may have waived your right to oppose the move so it is important that you comply with these requirements. If she simply improperly moves away without following this law, you will have a certain period of time to file papers where she and the children have lived in the past six months (prior to moving) and she will have to answer them there, which means you do not have to go to Florida to file the paperwork so long as you act quickly.  It is important that you consult with an experienced attorney with a case like this so that you know your rights and obligations before they are lost due to not acting in a proper or timely manner.

This is for general informational purposes only.  You should always consult with an attorney before making any important legal decisions or signing any legal document.

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Can I change my annuity for one with a better interest rate?

submitted by Rosemary G. Caligiuri, CASL™, President, Harvest Group Financial Services

Yes. However, to receive favorable tax treatment, the exchange must satisfy the requirements of a Section 1035 exchange. According to Section 1035 of the Internal Revenue Code, you can exchange one annuity for another without the immediate recognition of any gain or loss, as long as the following requirements are met:

  • The annuity cannot be cashed in and the proceeds then used to purchase a new annuity contract. Rather, the value of the old annuity must be transferred to the new annuity, usually by assigning rights to the old annuity to the company issuing the new annuity.
  • The exchange must involve like-kind property (i.e., property that is similar in nature or class and of equal value). If the annuitant receives cash or a payment in kind of cash or property, then that part of the exchange involves property that is not like-kind and may be taxable.
  • Under the new contract, the owner, along with the annuitant, must be the same as under the old contract. Both contracts must also be payable to the same person(s) (the beneficiary).

Also, be aware that surrender charges may reduce the value of the annuity you transfer. In addition, the new annuity likely will impose a new set of surrender charges.

Any information contained herein should not be construed as tax or legal advice. It is always recommended that you consult a qualified tax or legal professional regarding your personal situation.

Registered representative offering securities and advisory services through CentaurusFinancial Inc, a Registered Investment Advisor, Member FINRA & SIPC,Supervisory Branch: 3902 State Street, Suite 101, Santa Barbara, CA 93105,1-888-569-1982, Harvest Group Financial Services, Corp and Centaurus Financial, Inc Are Not Affiliated Companies.

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When divorce becomes a reality

Submitted by Karen Ulmer Pendergast, Esquire, Ulmer Law, ulmerlaw.com

Oftentimes it is easier to deny that things have come to the point where a divorce is inevitable. While it may feel easier to pretend that everything is fine, it is not often the wisest course of action to continue to ignore what is happening. Being prepared for the divorce and the changes that come with it is essential no matter how difficult or how painful it may be to face reality.

One first course of action that you should take when divorce seems like it may become your reality is to meet with a divorce attorney to learn what you can expect legally in the days and years ahead. Most divorce attorneys provide a consultation either for free or for a low fee.

Many people do not realize that there is alimony in Pennsylvania. Not only does the parent who does not have the children the majority of the time have to pay child support, if they earn more than their spouse they will also most likely have to pay alimony. In Pennsylvania it is awarded unless the spouse remarries or lives with someone of the opposite sex, but the length is based on the length of the marriage. In addition, many divorcing couples do not realize that the retirement plan of their spouse is something that they are both entitled to in a divorce. Assets accumulated during the marriage are all considered regardless of how they are titled or if they are just in one person’s name.

When you believe that a divorce may be on the horizon, you should contact an attorney even if you are not ready to hire one. Being prepared and knowing what to expect is the smartest decision you can make.

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I don’t know much about investing, should I let my husband make the decisions?

submitted by Rosemary G. Caligiuri, CASL™, President, Harvest Group Financial Services

Even if your husband is a financial expert, it’s a good idea to at least understand investing basics. For one thing, because women on average tend to live longer than men, the odds are extremely high that you could be responsible for making your own financial decisions at some point. If you suddenly had to make all the decisions yourself – and many women have found themselves in that position – you’d benefit from knowing enough to protect yourself from fraud and/or communicate effectively with a financial professional.

Also, even if your spouse is more knowledgeable about finances than you are, understanding enough to consider the pros and cons involved in an individual financial decision can often produce a better outcome; it forces both of you to address questions you might not have considered otherwise. Knowing why a decision was made can help minimize second-guessing on either side later.

If you disagree about a particular investment, remember that though diversification doesn’t guarantee a profit or prevent the possibility of loss, a diversified portfolio should have a place for both conservative and more aggressive investments. There may be ways to accommodate both spouses’ concerns, and a neutral third party with some expertise and a dispassionate view of the situation may be able to help you work through differences.

Any information contained herein should not be construed as tax or legal advice. It is always recommended that you consult a qualified tax or legal professional regarding your personal situation.

Registered representative offering securities and advisory services through CentaurusFinancial Inc., a Registered Investment Advisor, Member FINRA & SIPC, Supervisory Branch: 3902 State Street, Suite 101, Santa Barbara, CA 93105,1-888-569-1982, Harvest Group Financial Services, Corp and Centaurus Financial, Inc. Are Not Affiliated Companies. 

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What is asset allocation and how does it work?

submitted by Rosemary G. Caligiuri, CASL™, President, Harvest Group Financial Services

Asset allocation is a technique used to spread your investment dollars across several asset categories. The investment categories may include cash and cash alternatives, bonds, stocks, real estate, mutual funds, insurance products, or any other investment category imaginable. The general goal is to minimize volatility while maximizing return. The process involves dividing your investment dollars among asset categories that do not all respond to the same market forces in the same way at the same time. Though there are no guarantees, ideally, if your investments in one category are performing poorly, you may have assets in another category that are performing well. The gains in the latter may offset the losses in the former, minimizing the overall effect on your portfolio.

The number of asset categories you select for your portfolio and the percentage of portfolio dollars you allocate to each category will depend, in large part, on the size of your portfolio, your tolerance for risk, your investment goals, and how long you plan to keep your money invested. A simple portfolio may include as few as three investment categories, with a percentage of total dollars divided among, for example, cash alternatives, bonds, and stocks. A more complex portfolio may include many more asset categories or break down each of the broader asset categories into subcategories.

Generally, the asset allocation that best suits your needs may be determined with the help of a financial professional. Whether you hire a financial professional or not, be sure to periodically review your portfolio to ensure that the mix of investments you have chosen still serves your investment needs.

*Asset Allocation and Diversification does not guarantee profit, nor is it guaranteed to protect assets.

Any information contained herein should not be construed as tax or legal advice. It is always recommended that you consult a qualified tax or legal professional regarding your personal situation.

Registered representative offering securities and advisory services through Centaurus Financial Inc., a Registered Investment Advisor. Member FINRA and SIPC, Supervisory Branch: 3902 State Street, Suite 101, Santa Barbara, CA 93105, 1-888-569-1982.

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Can I change my annuity for one with a better interest rate?

submitted by Rosemary G. Caligiuri, CASL™, President, Harvest Group Financial Services

Yes. However, to receive favorable tax treatment, the exchange must satisfy the requirements of a Section 1035 exchange. According to Section 1035 of the Internal Revenue Code, you can exchange one annuity for another without the immediate recognition of any gain or loss, as long as the following requirements are met:

  • The annuity cannot be cashed in and the proceeds then used to purchase a new annuity contract. Rather, the value of the old annuity must be transferred to the new annuity, usually by assigning rights to the old annuity to the company issuing the new annuity.
  • The exchange must involve like-kind property (i.e., property that is similar in nature or class and of equal value). If the annuitant receives cash or a payment in kind of cash or property, then that part of the exchange involves property that is not like-kind and may be taxable.
  • Under the new contract, the owner, along with the annuitant, must be the same as under the old contract. Both contracts must also be payable to the same person(s) (the beneficiary).

Also, be aware that surrender charges may reduce the value of the annuity you transfer. In addition, the new annuity likely will impose a new set of surrender charges.

Any information contained herein should not be construed as tax or legal advice. It is always recommended that you consult a qualified tax or legal professional regarding your personal situation.

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Dealing with separation anxiety

submitted by A Child’s World, www.achildsworld.com 

Whether you’re going back to work after having a baby or just think it’s time for your child to begin attending an early childhood program, there are some things to consider regarding separation anxiety – not your child’s, but rather yours.

Anxiety over the safety of your children is real and understandable. Children, on the other hand, do not harbor the same fears and anxieties. They are naturally more daring and inquisitive. Parents play a key role in their child’s smooth transition to this exciting socializing and learning experience. If the parents are freaked out, there is a good chance the child will be as well.

So true is the opposite. If the parents are calm and present this in a positive light, the child will see it that way as well. This is much healthier for the child.

While you will be tempted on the first day and maybe more to stay and see how your child fares in the new surroundings, the very best thing for your child is for you to say goodbye with a hug and a kiss and leave the room.

You should be able to call the center during the day to see how things are going. You will have an opportunity to peek in and speak with staff when you pick up. This will lessen your child’s anxiety and allow him/her to move into the class activity and socialize.

The longer you stay, the longer your child will focus on you, thus making the separation harder on him or her. The teacher should aid this by gaining your child’s attention and welcoming him or her into the class.

It is always important to discuss the experience with your child even if your child is not yet verbalizing. This plays out for parents when your children go to first grade, college, get married and go off to form their own lives.

Somehow you will get through it.

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I don’t know much about investing. Should I let my husband make the decisions?

submitted by Rosemary G. Caligiuri, CASL™, President, Harvest Group Financial Services

Even if your husband is a financial expert, it’s a good idea to at least understand investing basics. For one thing, because women on average tend to live longer than men, the odds are extremely high that you could be responsible for making your own financial decisions at some point.

If you suddenly had to make all the decisions yourself – and many women have found themselves in that position – you’d benefit from knowing enough to protect yourself from fraud and/or communicate effectively with a financial professional.

Also, even if your spouse is more knowledgeable about finances than you are, understanding enough to consider the pros and cons involved in an individual financial decision can often produce a better outcome; it forces both of you to address questions you might not have considered otherwise.

Knowing why a decision was made can help minimize second-guessing on either side later.

If you disagree about a particular investment, remember that though diversification doesn’t guarantee a profit or prevent the possibility of loss, a diversified portfolio should have a place for both conservative and more aggressive investments. There may be ways to accommodate both spouses’ concerns, and a neutral third party with some expertise and a dispassionate view of the situation may be able to help you work through differences.

Any information contained herein should not be construed as tax or legal advice. It is always recommended that you consult a qualified tax or legal professional regarding your personal situation.

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How often do I need to review my estate plan?

submitted by Rosemary G. Caligiuri, CASL™, President, Harvest Group Financial Services

Although there’s no hard-and-fast rule about when you should review your estate plan, the following suggestions may be of some help:

  • You should review your estate plan immediately after a major life event;
  • You’ll probably want to do a quick review each year because changes in the economy and in the tax code often occur on a yearly basis;
  • You’ll want to do a more thorough review every five years.

Reviewing your estate plan will not only give you peace of mind, but will also alert you to any other changes that need to be addressed. There will be times when you’ll need to make changes to your plan to ensure that it still meets all of your goals. For example, an executor, trustee, or guardian may change his or her mind about serving in that capacity, and you’ll need to name someone else.

Other reasons you should do a periodic review include:

  • There has been a change in your marital status (many states have laws that revoke part or all of your will if you marry or get divorced) or that of your children or grandchildren;
  • There has been an addition to your family through birth, adoption, or marriage (stepchildren);
  • Your spouse or a family member has died, has become ill, or is incapacitated;
  • Your spouse, your parents, or other family member has become dependent on you;
  • There has been a substantial change in the value of your assets or in your plans for their use;
  • You have received a sizable inheritance or gift;
  • Your income level or requirements have changed;
  • You are retiring.

I always recommend investors consult with their own qualified tax and financial advisors prior to making any investment decisions.

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How can I plan for retirement if my employer doesn’t offer retirement benefits?

submitted by Rosemary G. Caligiuri, CASL™, President, Harvest Group Financial Services

In many cases, your first step should be to open an IRA and contribute as much as allowable each year. Because of the potential for tax-deferred, compounded earnings, IRAs offer similar long-term growth opportunities as employer-sponsored plans.

In addition, you may qualify for tax-deductible contributions or tax-free withdrawals, depending on whether you invest in a regular IRA or a Roth IRA.

Another tax-advantaged option to consider is annuities. Generally purchased from a life insurance company, a typical annuity features the potential for tax-deferred growth and provides either fixed or variable payments beginning at some future time (usually retirement). Depending on the type of annuity, you may have several options in how you ultimately take distributions.

Finally, don’t forget about traditional investments (e.g., stocks, bonds, mutual funds). Most of these vehicles are taxable, but they can still help you over the long term.

The specific types of investments you select will depend on your risk tolerance, time horizons, liquidity needs, and goals for retirement. A financial professional can help you construct a portfolio that makes sense for you.

I always recommend investors consult with their own qualified tax and financial advisors prior to making any investment decisions.

Registered representative offering securities and advisory services through Centaurus Financial Inc, a Registered Investment Advisor, Member FINRA & SIPC, Supervisory Branch: 3902 State Street, Suite 101, Santa Barbara, CA 93105, 1-888-569-1982, Harvest Group Financial Services, Corp and Centaurus Financial, Inc Are Not Affiliated Companies.

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