At least once a year, you should follow up to see how much progress you are making toward your financial goals. Here’s how the process might work.

Goal. Let’s say Barb wants to build a $1 million retirement fund. She has $250,000 now, and she wants to retire in 20 years. Using an assumed annual investment return of 6%, Barb needs to save $5,083 a year.

Progress check. Barb checks her progress after one year and sees that her fund is worth $265,000 — less than the amount she should have, based on her plan. Barb decides to find out why she has fallen behind.

Explanation. A look at her records reveals that not only did she fall short of her yearly savings target, her investment return was somewhat lower than projected. To compensate, Barb decides to bump up next year’s target savings rate.

Using a similar approach can help you stay on track toward your goals.

The continued uncertainty regarding the fate of the federal estate tax complicates planning for anyone who might have a taxable estate. As things stand now, estates worth up to $2 million can avoid taxation, and that threshold increases to $3.5 million for 2009. While estate-tax repeal is still on the books for 2010, the tax is reinstated the very next year with a significantly lower exemption amount of $1 million.

Time To Take Action? ...click here for more...

Are you the parent of a child headed to college in the fall? With college bills pending, you may be looking at your options for helping your child meet expenses.

Liquidating College Savings Accounts

Selling Securities

Withdrawing from an IRA

A close look at several provisions of the federal tax code reveals that certain birthdays can indeed affect your personal income taxes.  ...click here for more...