2017-04-26 / Columns

Spring cleaning isn’t only for your home; it’s for your finances too

MONEY MATTERS
AMY MILGRIM
Executive Director, Jewish Community Foundation

Spring cleaning? Decluttering your home? Vamoosing your VCR and letting go of your leaky lava lamp?

Great!

While this process may be tedious and trying, the end result may be your ticket to saving time (and sanity) down the road.

Once you start down the path of spring-cleaning your house, how about doing the same for your finances? Let’s take a look at some notes for you to consider as you prepare to get down and dirty:

• Managing old documents: Perhaps you have a box full of outdated credit card receipts, tax returns, insurance statements, and other financial fodder. What to keep? Decisions, decisions. Fortunately, there are some helpful guidelines regarding what you should save for a calendar year or less, versus multiple years, or even indefinitely. A Google search of “how long to keep documents” will deliver you a trove of resources on this topic. For instance, insurance policy paperwork can be replaced when new ones arrive, while tax returns should be held for seven years.

• Consolidating retirement accounts: If you have moved jobs, it’s quite likely that you’ve accrued multiple retirement accounts. You may want to consider consolidating these accounts to make your life easier, and perhaps even managing to improve your investment options. While you’re at it, have you thought about contributing extra dollars from each paycheck to your retirement fund? Now that you just finished tax season, it may be the time to evaluate your ability to do so.

• Saving for college: Got kids or grandkids? If so, have you established a college savings account such as a 529 plan for each future undergrad? The sooner you save and invest, the more funds you are likely to have at the ready when it’s time to pay tuition.

• Streamlining your charitable giving: If you’re like many people who generously donate money throughout the year, whether it’s for one charity or multiple charities, now is a great time to consider establishing a donor advised fund (DAF) with the Foundation, Inc. as you are fixing up your finances. With our user-friendly and intuitive online platform, your charitable giving will be as easy as 1-2-3:

One: To start an account, you simply complete some basic forms, and then you can donate cash—or even better from a tax benefit standpoint, stocks, bonds, or mutual funds—at any time into the fund.

Two: At your convenience, you can recommend a distribution from your DAF to benefit any qualified 501(c)(3) nonprofit organization, such as your synagogue, Jewish Federation agency, or day school, and the JCF processes a check.

Three: Instead of having to wrangle together paperwork for each donation made when it’s tax time, the JCF takes care of it for you. (So there’s less to declutter next spring.)

JCF donor David Olinsky said about his DAF, “It’s a great financial planning tool, enabling me to donate appreciated assets such as stocks and mutual funds, and not have to pay capital gains taxes. Plus I can run it exactly as a family fund, where we talk about which charities we want to support, ranging from Jewish organizations to arts and cultural programs to national medical causes. We even have the flexibility to make grant recommendations all online, and the JCF staff is incredibly accommodating as well.”

As always, it’s a good idea to check with your trusted advisor to make sure your financial decluttering is performed properly.

While you’re at it, please call us at the JCF at (856) 673-2582 to talk about the benefits of a DAF for your charitable giving. You just might find a DAF to be even groovier than your lava lamp ever was!

amilgrim@jfedsnj.org

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