Arizona accountant
5719 E. St. John Rd.
Scottsdale, AZ 85254
(602) 867-4199
Fax: (602) 788-6911

January, 2007 Tax Tip

Seven Action Steps for Sound Financial Planning


Many of us start the new year with good intentions as evidenced by our New Year Resolutions.  But do your resolutions include any relating to proper financial planning?


For the first Tax Tip of the new year I am providing a summary of seven action steps for sound financial planning.  Follow these steps and you will be well on your way to outstanding financial health in 2007.


  1. Contribute as much as possible to your company retirement plans.  Do not merely invest what the company matches.  If you can’t contribute the maximum right away, add more each year until you reach the maximum.


  1. Fund and contribute the maximum to a Roth IRA.  This will build tax-free and qualifying distributions will not be taxed to you.  Remember, you can’t deduct your contributions, but the tax-free distributions of accumulations and appreciation will reward you handsomely for the forbearance of the tax deduction.


  1. Consider setting up a section 529 tax-free college plan for your children or grandchildren.  See Saving for College – Section 529 Plan (May, 2002 Tax Newsletter on my website,


  1. Set your financial goals and write them down.  It is very important that the goals be realistic and attainable.  Review them on a regular basis.


  1. Determine what your primary financial concern is and review it with a financial advisor.  Often we cannot identify or we may incorrectly identify our primary financial concern.  This is all the more reason to seek out a competent financial professional.


  1. Review the diversification of your retirement assets (including your 401(k) plan) or other investments with your financial or investment advisor.  This should also be done at least annually, as a diversification change may be indicated by market and other economic conditions.


  1. Review your life insurance and disability income plans periodically.  Many people have inadequate coverage.  If there has been a change in your personal life such as marriage, divorce, children, new employment, or loss of job it is vital to check your beneficiary designations and change them, if appropriate.


Please feel free to contact me at (602) 867-4199 if I can assist you in any way with the above steps, including referrals to highly competent financial and/or investment planners.


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