Do you have a financial question?

If so, look no further. Book a one-hour video meeting with a Tilly Certified Financial Planner (CFP)^®.

Booking an appointment is simple. First, contact Tilly today to register. Then, provide us with your financial information, and your Tilly CFP will review it and set up an appointment to address your concerns.

Here are some questions we commonly hear from Tilly clients:

• Is my 401(k) optimally invested to reach my financial goals?
• Are my investments properly allocated to reach my goals?
• Do I need life insurance? If so, how much should I purchase and from whom?
• What about long-term care insurance? Is it worth the expense?
• Should I invest in a Roth IRA (individual retirement account) or a Traditional IRA? What is the difference?
• What are some sound strategies for saving and budgeting?
• I’d like to purchase a home. How much can I afford?
• How fast should I pay off loans versus how much should I put into savings?
• Do I have an adequate amount of savings?
• Is purchasing a rental property a good investment for me?
• In which of the 10,000 different mutual funds should I invest?

What is your specific question? Or maybe you’d just like a CFP to look over your finances and investments and make a few recommendations. Either way, Tilly is here to help!

And there’s even more good news: This new service is available just in time for the holidays. A Tilly meeting might make a perfect gift for a friend or loved one. The cost is only $300 for the first one-hour session and $175 for subsequent one-hour sessions.

Keep in mind, Tilly also continues to provide our membership offering, which is only $800 per year. A Tilly membership includes ongoing advice from your designated CFP, quarterly emails to track your net worth, tasks, and goals, access to the RightCapital investment monitoring platform, and an annual review with your CFP.

It is open enrollment time! Have you reviewed your choices to make sure you are taking advantage of your company benefits? Here are a few points to consider.

Healthcare Options

How do you decide which healthcare option to choose? First, if you are married, compare the options of both plans. One spouse’s plan may be better than the other. Compare all costs such as premiums, deductibles, co-pays and coinsurance. Also consider major medical needs for the upcoming year. Are you or any family members planning a surgery or a pregnancy? If so, you may want to switch to a plan that covers more of these costs for the next year, then switch back to a lower premium plan the year after.

Should you choose the High Deductible Health Plan (HDHP) or the Preferred Provider Organization plan (PPO)? High Deductible Health Plans typically have lower premiums and allow the participant to save in the triple tax advantage HSA savings. This is a great option if you can afford health care expenses incurred out of pocket. Your HSA savings can also be invested for future use.

If you have chronic or frequent medical needs, the PPO plan may be better for your wallet. It may also be a better option if paying for out-of-pocket medical expenses will put a major strain on your savings. Take to time to figure out which plan is best for you and your family. Tilly recommends putting together a simple spreadsheet to forecast and compare costs.

Life and Disability Insurance

Does your benefit package include life and disability options? Company provided life insurance is typically inexpensive, and sometimes offers a small policy for a spouse. Disability insurance is also an important benefit, especially if you do not already have a personal policy. According to ssa.gov, 1-in-4 20-year-olds will become disabled before reaching retirement age. While social security benefits can help, it can take a long time before becoming eligible for benefits. Evaluate the options offered and take advantage of them if they are affordable.

Retirement Savings

If your company offers a retirement plan such as a 401k with a matching contribution, please take the free money! If you need to start small, try and contribute the amount that will allow you to receive the maximum contribution from your employer. As your income grows, or as you receive raises, it is a great practice to increase your contributions. This will help you reach your retirement savings goals without feeling the pinch of less income.

Open enrollment is also a good time to review how your retirement contributions are invested. Many plans offer a target date fund that will slowly include more fixed income as you get closer to retirement. This is a great catch all option, but your plan may also offer some other investment choices that could be worth considering. For example, index funds are a great option and typically charge a very low fee. These funds mirror an index such as the S&P 500. Take your risk tolerance and length of time you have until retirement into consideration when choosing the funds that are best for you.

Fringe Benefits

Finally, many employers offer a slew of additional “fringe” (perk) benefits ranging from tuition reimbursement, wellness programs, childcare, paid medical leave for yourself to care for a loved one, stock option plans, and continuing education – just to name a few. Our advice to grab a cup of coffee, sit down uninterrupted and read through these options and seriously consider if you should take advantage of them. Too many people don’t take them seriously and miss out because they didn’t think through them.

That’s it! Tilly spends a great time of time helping our clients think through benefits. If you have questions about your company benefits, ask Tilly!

In our previous blog, we provided the first seven financial strategies to help you come out on top. But we aren’t done yet! Here are seven additional actions to take now to secure your financial future.

Here are seven additional actions to take now to secure your financial future.

1. Fast-track any type of long-term saving: If your employer matches your 401(k) contributions, you should try to contribute the minimum amount to earn that free money. Hypothetically, let’s say you are 25 years old and have a $50,000 salary. If you save 4% ($2,000 per year), and your employer matches that same 4% (another $2,000 per year), and you have a 7% rate of return on your investments, you will have $828,522 at age 65. If you wait just five years and start at age 30, the ending value earning a 7% rate of return is only $573,708. So, by starting at age 25, investing the extra $10,000 over those five years, and receiving the employer match, you will make $254,814 more by the time you reach retirement age.

2. Budget and save using the “envelope method”: Some find it very helpful to set up “envelopes” and save cash from each paycheck to go towards their specific savings goals (e.g., a new house, vacations, an emergency fund, or a new car). You can do this electronically by setting up savings accounts for each of your goals. Go a step further by automating the transfer after each paycheck.

3. Don’t overpay for financial advice and investment management: The typical fee for financial advisors can range from 0.25% to 2% of assets under management per year. For an account that has $200,000, this can be as much as $3,000 annually … or even more. There are also options to pay a flat hourly fee or an annual flat retainer fee. Make sure you know what you are getting for your money. Is the fee just for managing your money, or does the advisor also provide financial planning and advice as part of the fee?

4. Time your major purchase spending: If you plan to make a major purchase in the upcoming year or two, time your purchases for when the best deals are available for that specific product. A quick Google search will help you find the time depending on the item. For example, the week before Labor Day is a great time to buy large appliances and December typically offers the best deals on new cars.

5. Don’t overpay for mutual funds: There are two types of mutual funds: active and passive. Active funds have costs associated with highly paid fund managers who research investment options in an attempt to outperform the market. Passive funds, on the other hand, mirror an index such as the S&P 500. This means their fees are much lower than active funds. Fees over a long period of time greatly diminish your returns. According to Morningstar, only one out of every four active funds topped the average of their passive rivals over the 10-year period ending December 2022.

6. Make sure you are taking advantage of your company benefits: Open enrollment is right around the corner for many employees. Are you leaving great benefits on the table by just keeping the same selection you had the previous year? Take time to review each option. Can you add a life insurance policy for your spouse? Would switching to a high-deductible health care plan be in your best interest? Should you be taking advantage of the flexible spending accounts offered? Benefits make up a significant portion of many compensation packages. Make sure you are taking advantage of all that you are offered.

7. Reduce your taxes: There are many ways to reduce your taxes by taking some simple steps. Contributing to any of the following can help: traditional IRA, traditional 401(k), health savings accounts (for those with high-deductible health care plans), and flexible savings accounts for health care and dependent care expenses. If you itemize your tax return, you also can make tax-deductible charitable contributions. If you choose to donate stock to a charity, you get the benefit of donating the fair market value of the stock at the time of donation without having to realize the tax gain.

There you go. If you have any specific questions about how these strategies could work for you, ask Tilly! We’re happy to help.

In the classic tale, A Christmas Carol, the mean-spirited Scrooge appears to spend all of his time managing and worrying about his wealth. While there’s no need to act like Scrooge in real life, most of us should spend some time keeping an eye on money matters.

Here are seven big picture strategies to improve your long-term financial results.

1. Save half of your pay raises: Because you didn’t have access to these funds beforehand, make it a habit to invest or save half of each pay raise. This best practice will have a profound effect on your net worth over a long period of time.

2. Invest tax-efficiently: To encourage savings, the government has established all sorts of tax incentives. Some of these opportunities are downright confusing and require a little research or asking for help. Free money goes a long way, so it’s best to figure this stuff out – and not miss out on good wealth-accumulation opportunities.

3. Shop around: The financial industry emphasizes relationship-building and trust to dissuade you from shopping for the best deal. But remember: Financial firms offering these products change their prices frequently. It’s best to get three quotes. Tilly can help with that process.

4. Stay in your lane: This is a big one. If you aren’t a highly trained financial professional, steer clear of purchasing high-risk investments such as options, commodities, small stocks, and cryptocurrency. In the short-term, you may win on some of these trades, but the long-term is another ball game. (Reading articles on the Internet does not make you a highly trained professional, FYI.)

5. Strive for competitive interest rates on your cash savings: When it comes to your emergency funds and cash savings, if you readily accept the paltry interest rate your bank provides, you’ll lose thousands of dollars in interest over the long-haul. You must proactively manage your savings to get a good rate by finding better rates without sacrificing your risk tolerance.

6. Maintain a “Goldilocks” amount of insurance: While insurance provides security and peace of mind, you don’t necessarily need to purchase too much insurance or buy expensive features such as whole life policies. Instead, consider purchasing what you need and using good financial management to protect against smaller risks.

7. Purchase financial products that are best for you, not just suitable for you: There’s a big difference between a suitable product and the best product. For example, a suitable product might imply there is a less expensive, better product available that you aren’t aware of. Many financial professionals will recommend the suitable product, so beware!

So there you have it. In future blogs, we’ll dive deeper into some of these strategies. If you have questions, ask Tilly today. We’re here to help.

Today, we’re sharing how Tilly clients benefit from working with us. Clients pay only $800 per year and in exchange secure these vital services.

1. Experienced Financial Decision-Making: Do you have someone to help weigh if you should make a particular investment? Or if you should refinance your mortgage? Do you struggle deciding which mutual fund to buy? Do you have access to someone who can run various retirement savings scenarios? Are you dialed into the latest tax code changes? Tilly offers you access to a CERTIFIED FINANCIAL PLANNER™ so you’re in the know!

2. Task Management: One of the biggest challenges managing money is just getting things done. If tasks aren’t handled, money is lost. For example, let’s say you need to roll over your former employer’s 401(k) plan into an IRA. However, like most of us, you kick the can down the road getting this completed. Weeks turn into months, months turn into years before you get it done, if ever. Meanwhile, your retirement savings aren’t being optimally managed. That’s where Tilly comes in. We maintain a list of your tasks online and nudge you along without being a pest. A bonus feature is that we also track completed tasks — providing you that satisfying feeling of accomplishment.

3. Tracking Your Net Worth and Optimal Asset Allocation: Tilly’s goal is to grow our clients’ net worth — and so we track it for you on a quarterly basis. Each quarter, we email our clients their statements of net worth and update any changes. On an annual basis, Tilly reviews your investments to make sure they are properly balanced to reach long-term goals. We evaluate equities, bonds, cash, etc. (asset allocation), and if your investments are out of balance, Tilly provides recommended trades to get you back where you need to be.

4. Big Mistake Avoidance: The average American estimates they waste around $1,819 per year due to their lack of financial knowledge, according to a 2022 survey from the National Financial Educators Council. This amount keeps rising each year. There are so many reasons for mistakes — such as not understanding the complex US tax codes, or overpaying for investment products. Tilly helps our clients avoid these mistakes.

5. Access to Money-Saving Financial Tips: Tilly provides our clients with many financial tips. For example, we’ve had several clients saving money at a bank earning 1% interest or less. We have shown them how they can invest their intermediate to long term cash in similar low-risk investments such as US government I-Bonds. The I-Bonds yield at least the rate of inflation, providing them much higher interest. Over a long period of time the added interest more than pays for the cost of Tilly.

6. Financial Counseling: When you need to make important financial decisions, it’s helpful to have access to someone who listens and understands your needs. That’s where Tilly steps in. Our CFPs understand your personal challenges and goals, which are important to you on an emotional basis. We help you remove the emotion and guide you to make good fact-based decisions without being overbearing with our advice.

7. Tips for Completing Complex Tasks: Tilly clients are do-it-yourselfers, but every now and then you may get stumped by financial forms and platforms that are difficult to complete. No worries, Tilly can provide a helpful hand. Tilly also helps our clients with questions about making trades on Schwab, Fidelity, MerrillEdge, employer 401k platforms, and others.

Tilly clients really do gain a big return on their $800 per year investment.

There are two types of return on investment (ROI): “hard” ROI and “soft” ROI. Hard ROI is calculatable. For example, if your savings account balance $30,000 and you earn 2% interest, you will earn $600 per year. If Tilly provides you advice that earns you 4% interest with the same or less risk, you will earn $1,200 per year. You extra $600 is hard ROI. Another example of hard ROI is the time we save our clients from having to conduct their own research. There are many other examples of Tilly providing clients with hard ROI – and we will cover those in another blog post.

When it comes to soft ROI, these are more difficult to quantify, but they are valuable. Examples include counseling our clients and the confidence we provide them knowing they have a second opinion with big financial matters.

I hope this post helps. If you’re interested in learning more about how Tilly can benefit you specifically, please let know. We’re happy to provide prospective clients a free, 30-minute session.

Are you confused or unsure about which type of account you should open? The rules are subtle, and the differences can be confusing. To help you navigate the financial landscape, we created this glossary to explain common account types — all in one place. The accounts are conveniently categorized by:

• Personal Investment Accounts
• Individual Retirement Accounts (IRAs)
• Defined Contribution Employer Retirement Plans (e.g., 401(k)s)
• Defined Benefit Employer Plans
• Health Savings Accounts
• Education Savings Accounts
• Self-Employed or Small Business Retirement Accounts

If you have questions, Tilly is happy to help you! And please keep in mind that this glossary is just a summary of these accounts. Consult a professional before opening an account.

Personal Investment Accounts

Brokerage Account – A brokerage account is an investment account that allows you to buy and sell a wide variety of investment vehicles such as stocks, bonds, mutual funds, and exchange-traded funds (ETFs). Investment growth within a brokerage account is taxable, so any dividends, gains, or losses are reported annually to the IRS.

Individual Brokerage Account – A brokerage account in the name of one person only.

Transferable-on-Death Brokerage Account (aka, Designated Beneficiary Account) – This is a brokerage account in which the account owner(s) designate beneficiaries that will receive the assets upon the owner(s)’s death. This allows the account ownership to change without going through probate.

Joint Brokerage Account – The most common joint brokerage account is Joint with Rights of Survivorship. This account allows both individuals to have equal rights to the account’s assets. All assets are inherited by the surviving co-owner if one of the joint owners should pass away.

Another type of joint brokerage account is a Joint Tenants in Common Account. These accounts are typically used when two or more people own assets together, but each party chooses how to distribute the assets at their death.

Uniform Gifts to Minors Act/Uniform Transfers to Minors Act – UGMA or UTMA accounts are custodial investment accounts in a child’s name that is controlled by a parent or relative until the child reaches the age of maturity. This age can differ from state to state.

The parent or relative can make contributions and invest the assets for the benefit of the child, and the account is taxable at the child’s lower tax rate. Since these accounts are in the name of the child, they can negatively affect the ability of the child to be eligible for college loans.

Individual Retirement Accounts (IRAs)

Traditional IRA & Rollover IRA – A traditional IRA (or Rollover IRA) is a retirement savings account that allows the participant to make tax-deductible contributions up to $6,500 per year ($7,500 if age 50 or above), per 2023 maximum contribution limits. You must have earned income to contribute to the account, and the invested money grows tax-deferred. In retirement, distributions are taxable. You must be age 59 ½ before taking distributions, or you will incur a tax penalty. You also must start taking mandatory required minimum distributions at age 73. High income can limit or preclude you from being able to make tax-deductible contributions to a traditional IRA.

There is no difference between a traditional IRA and a rollover IRA. At one time, they did have small differences, but a change in the law made them the exact same account type.

Roth IRA – A Roth IRA is a retirement savings account that allows the participant to make after-tax contributions up to $6,500 per year ($7,500 if age 50 or above), per 2023 maximum contribution limits. You must have earned income to contribute to the account, and the invested money grows tax-free.

High income can limit or preclude you from being able to make Roth IRA contributions. If your income is too high, backdoor Roth IRA contributions may be an option.

You can take Roth IRA distributions from your contributions penalty-free, provided that your account has been open for at least five years. Roth IRAs do not require required minimum distributions, but you must wait until age 59 ½ to take distributions from account growth to avoid a tax penalty.

Roth IRAs are excellent accounts for long-term growth and flexibility for access to retirement funds in certain situations. This account allows for penalty-free withdrawals up to $10,000 to buy your first home and to fund higher education expenses.

Spousal IRA or Spousal Roth IRA – A spousal IRA or spousal Roth IRA allows a non-working spouse with little to no earned income to contribute up to the maximum contribution limit based on their spouse’s earned income. The couple must file taxes jointly to be eligible.

Beneficiary IRA or Inherited IRA – These terms are interchangeable for the same account type. This account is opened when a person is the beneficiary of a traditional IRA, where the original owner has passed away. Further contributions cannot be made to a Beneficiary IRA by the new account owner, however, and distributions are taxable to the beneficiary.

Different rules regarding required minimum distributions and account liquidation apply dependent upon: (i) the relationship between the new owner (beneficiary) and the original owner (decedent), (ii) age of the original owner at death, and (iii) the year of the original owner’s death.

Beneficiary Roth IRA or Inherited Roth IRA – These terms are interchangeable for the same account type. As the beneficiary of a Roth IRA, you must empty the account within 10 years. No taxes will be owed on the distributions.

Different rules regarding required minimum distributions and account liquidation apply dependent upon: (i) the relationship between the new owner (beneficiary) and the original owner (decedent), (ii) age of the original owner at death, and (iii) the year of the original owner’s death.

Defined Contribution Employer Retirement Plans

401(k) & Roth 401(k) – Employer-based retirement plans allow participants to contribute up to $22,500 annually ($30,000 if age 50 and above), per 2023 contribution limits. Unlike their IRA counterparts, there are no income limitations that restrict contributions to these accounts.

A 401(k) that allows for employee Roth contributions is referred to as a Roth 401(k). With a Roth 401(k), the employee has the option to make pre-tax or Roth contributions, or a combination of them. The plan will track which contributions are pre-tax vs. Roth and track the growth accordingly as well.

Typically, employers also contribute to these accounts by matching the employee contribution up to a limit or with a safe harbor contribution. All employer contributions are pre-tax.

Defined contribution accounts, such as a 401(k), allow for the participant to select their own investment choices from a pre-determined set of options. The participant takes on the investment risk within these plans by deciding their own investment mix.

Withdrawals from 401(k) plans can be made when the participant turns 59 ½. All distributions will be considered income and taxed at the participant’s income tax rate at the time of the withdrawal. If a participant should leave their employer before the age of 59 ½, they may also take a withdrawal but will owe a 10% tax penalty in addition to income tax.

The participant may also take distributions if they retire at the age of 55 or later or if the participant takes substantially equal periodic payments. A financial advisor can help advise in both of the last two options.

There are many other situations listed below in which penalty-free withdrawals can be made. All withdrawals will still owe taxes based on the participant’s income tax rate at the time of the withdrawal. These situations include:

• The participant becomes disabled.
• They are required to split the account with an ex-spouse due to divorce.
• They are adopting a child (up to $5,000).
• They need to pay an IRS levy.
• They are the victim of a disaster.
• They are a military reservist called to active duty.

403(b) – A 403(b) plan is very similar to a 401(k) plan, but it is the plan-type offered by public schools, non-profits, and churches. Some organizations are offering Roth 403(b) options. The withdrawal rules for a 403(b) are very similar to the 401(k).

457(b) – A 457(b) is an employer retirement savings account, similar to a 401(k), that is only offered to state employees, local government employees, and some tax-exempt organizations. Some organizations are offering Roth 457(b) options. It does not offer an employee match. This account is known as a deferred compensation account.

457 deferred compensation accounts have the added benefit of allowing withdrawals without penalty before age 59 ½, as long as you have terminated your employment. Although these withdrawals are taxable, the account is more accessible for those who opt for early retirement before age 59 ½.

Defined Benefit Employer Plans

Cash Balance Plan – A cash balance plan is a pension that credits a participant’s account each year with a pay credit based on compensation level plus an interest credit. The employer makes all contributions and assumes all the investment risk of the portfolio. Once the participant is eligible to receive the benefits, he or she would be able to take annuity payments based on the account balance or a lump sum that can be rolled into an IRA.

Government Pension Plan – Most state and federal branches offer government pension plans based on length of service with calculations that consider top earning years. The investment risk is taken on by the pension system.

Health Savings Accounts

Health Savings Account – A health savings account (HSA) is a tax-advantaged account for participants covered under an eligible high-deductible health plan. Contributions to the account can be made by the employee and the employer. Individuals can contribute up to $3,850 a year, and a family can contribute up to $7,750 per year, per 2023 contribution limits. These contribution limits apply to the sum of the contributions by both the participant and employer. Participants age 55 and above are able to make an additional catch-up contribution of $1,000 each year.

This account is often referred to as having a triple tax benefit.

• Funds contributed by the employee are made pre-tax.
• Many HSAs allow for the contributions to be invested, which allows this account to be a valuable retirement savings account. Invested dollars grow tax-deferred. Penalty-free distributions can be made after age 65, but distributions not used for qualified medical expenses will be taxable.
• Distributions for qualified medical expenses can be withdrawn tax-free at any time, which makes the HSA one of the most attractive savings vehicles. There is no time limit for when the distributions must be made, so if you save your receipts over the years, you can use them to support tax-free distributions in the future.

It is important to note that other health benefit accounts, such as FSAs and HRAs, have different rules than an HSA.

Flexible Spending Account – Flexible spending accounts (FSAs) allow employees to contribute pre-tax dollars to the account to be used for qualified expenses. Medical expense FSA accounts allow for contributions up to $3,050 per year. All savings must be used in the year in which they are taken, or they will be forfeited. Some employers do offer a grace period of up to 2 ½ months the following year to use the money or the ability to carry over up to $610 per year to use the following year.

Dependent Care FSA – The dependent care FSA allows for a couple filing jointly to save up to $5,000 per year and a single filer to save up to $2,500 per year towards childcare costs.

Health Reimbursement Account – A health reimbursement account (HRA) is funded by an employer. Once an employee has a qualified medical expense, they request to be reimbursed by the HRA account.

Education Savings Accounts

529 Plan – A 529 plan is a tax-advantaged savings account that allows an account owner to pay for education expenses from kindergarten through graduate school for the designated beneficiary. All contributions made to the account can be invested and grow tax-deferred. All withdrawals are tax-free if used for qualified education expenses. Each state has their own 529 plan, and some states offer a state income tax benefit on contributions as well.

The account owner designates a beneficiary at the point of opening the 529, but the beneficiary can be changed at any time. If there are any funds left in the 529 account and the account has been funded for at least 15 years, the money may be rolled into a Roth IRA account with the beneficiary being named as the Roth IRA account owner.

There are no annual contribution limits with a 529 plan, but any amount over $17,000 will go toward the giver’s lifetime gift tax exemption limit. Those who want to gift a larger sum are allowed to contribute $85,000 every five years without triggering the gift tax limit.

Coverdell Education Savings Account – Coverdell accounts are similar to a 529 account in that they offer tax-free growth if the distributions are used for qualified education expenses. Contributions are limited to $2,000 per year, and the account can only be set up for a beneficiary under the age of 18. Contributions are not allowed after the beneficiary turns 18.

The positive feature of a Coverdell is that the investment options are limitless. The 529 plan investments are limited to what each state’s 529 plan custodian offers, though most state 529 plans have decent investment options.

Self-Employed or Small Business Retirement Accounts

SIMPLE IRA – A SIMPLE IRA plan is for businesses with 100 employees or less. It is relatively easy to set up and allows for business owners to contribute a non-elective 2% to eligible employees’ accounts or a match up to 3% based on employee contributions.

While the employer contributions are tax-deductible for the business, the owner is only allowed to save a total of $15,500 per year. There is also no Roth option available for SIMPLE IRAs.

Simplified Employee Pension (SEP) IRA – A SEP IRA is similar to a traditional IRA but allows the self-employed individual to contribute up to 25% of their compensation, up to a maximum of $66,0000 per year. If the self-employed individual has employees, they must contribute the same percentage to the employee accounts as their own account. Employees must be at least 21 years old, earn at least $750 per tax year, and have worked for the employer for at least three of the past five years to be eligible to receive contributions. The employer can also make these requirements less restrictive if they choose.

Solo 401(k) or Individual 401(k) – These terms are interchangeable. A solo 401(k) is best for solo-owned businesses without employees, though exceptions are made for business partners and spouses. A solo 401(k) allows a participant to contribute as an employer and an employee. As an employee, you can contribute up to the maximum of $22,500 in 2023 and then an additional 25% of your net-adjusted self-employment income.

Other benefits of a solo 401(k) include the option to add a solo Roth 401(k). Only employee contributions can be made into the Roth account, but having a mix of the Roth and traditional accounts is a benefit the SEP or SIMPLE IRA cannot offer. Additionally, you can take a loan from the solo 401(k) up to the lesser of 50% of the account value or $50,000.

There are many more account types in the investment universe that may perform best for you. Working with a CFP^® at Tilly can help you discover the accounts that best fit your personal needs.

The federal student loan pause that started back in March 2020 is coming to an end. The Supreme Court also has ruled against the Biden administration’s student loan relief package that would have canceled up to $20,000 in federal student loans for nearly 43 million people. The time for borrowers to start paying back their student loans is right around the corner. While payments do not restart until October, interest will start accruing again in September. The exact date can vary, but NOW is the time to get prepared.

Here are four steps to follow so that you will be ready in advance of restarting your student loans payments.

1. Login to StudentAid.gov and locate your student loan servicer. Reach out to your servicer to make sure your contact information is up to date. If you had autopayment set up previously, make sure this information is still correct, as well. You may have to opt back into this payment method.

2. Ask your servicer how much you can expect your payments to be and what payment options they may offer. If you do this now, you will have a much better chance of not waiting in the telephone customer service line with everyone else come September.

3. If you are struggling financially, ask your provider for help with setting up an Income-Driven Repayment plan. There are several options that can drastically reduce your monthly payment. Use the Loan Simulator tool provided on the StudentAid.gov website to see what options you have. You can use the Loan Simulator tool to research the best repayment strategy as well. Also, if you are in a temporary financial bind and can’t afford to start repaying your student loans in the fall, you may be eligible for a deferment or forbearance. Keep in mind that interest will continue to accrue during a forbearance. The interest for a deferment typically does not accrue.

4. It has been more than three years since you had to make student loan payments. Adjust your monthly budget accordingly to afford the payments. Here are a few tips:

• Start “practicing” making payments into your own savings account to see how the new outflow affects your budget.
• Look carefully at your previous year’s expenses to see what items can be cut out.
• If at all possible, avoid reducing your retirement account savings — especially the amount that is matched by your employer.

Time is key! If you do choose an Income-Driven Repayment plan, you will want to do this now so it will be set up when the repayment pause ends this fall.

If you need help figuring out how student loan payments affect your financial plan, reach out to Tilly. We are here to help!