How To Handle an Inherited 401(k) Plan Account

When you inherit a 401(k) plan account, the options available to you depend on a number of factors, including the terms of the 401(k) plan and your relationship to the deceased 401(k) plan participant. In general, you’ll have four options: take an immediate distribution, disclaim all or part of the assets, leave the money in the 401(k) plan (if the plan permits), or roll the funds over to an IRA.

Should You Take the Cash?
Obviously, if you need the funds immediately, taking a lump-sum distribution from the 401(k) plan may be your only viable alternative. But you’ll have to pay ordinary income tax on the distribution (certain exclusions apply; talk to your financial professional for details).

A lump sum might also be attractive if you’re entitled to a distribution of employer stock. You may be able to pay ordinary income tax on just the participant’s basis in the stock, and defer tax on the appreciation (also called “net unrealized appreciation”) until you sell the stock in the future–at capital gain rates.

What’s a Disclaimer?
When you disclaim (i.e., refuse to accept) 401(k) assets, they pass instead to the plan participant’s contingent beneficiary, or estate if there is no contingent beneficiary. In general, you must give the plan written notice of your intent to disclaim the funds within nine months after the participant’s death. But be careful not to exercise control over the funds in the meantime (for example, by choosing a distribution option or by exercising investment control), or you may lose your ability to disclaim the funds.

A disclaimer may be an attractive option if you’re sure you won’t need the funds, and the transfer to the contingent beneficiary makes good economic and estate planning sense.

The Problem With 401(k) Plans
If you’re like most beneficiaries, your goal will be to stretch payments out as long as possible, taking full advantage of the tax deferral offered by retirement plans. This means either leaving the assets in the 401(k) plan, or rolling them over to an IRA.

For most, leaving the funds in the 401(k) plan isn’t the best choice for two reasons. First, the investment alternatives available to you in a 401(k) plan are limited to the ones selected by the employer. Second, the distribution options offered by a 401(k) plan typically aren’t as flexible as those available in an IRA. In fact, many 401(k) plans require beneficiaries to take distributions shortly after the participant’s death.

Roll the Funds Over to an IRA
Unless the 401(k) plan offers a unique investment alternative, rolling the 401(k) assets over to an IRA will usually be your best choice. IRAs offer virtually limitless investment options. And when it comes time to take distributions from the plan, IRAs offer the most flexible payment provisions. But, before deciding on a rollover, make sure you understand any fees and expenses that may apply.

If you’re a surviving spouse, you’ll have to decide between rolling the funds over to your own IRA, or to an IRA that you establish in the participant’s name, with you specified as the beneficiary (this is referred to as an “inherited IRA”).

Which Should you Choose?
In most cases, spouses are better off rolling the funds over to their own IRA. A rollover is typically appropriate only if you’re younger than 59½ and you think you’ll need the funds before you reach that age. That’s because distributions from an inherited IRA aren’t subject to the 10% early distribution penalty tax. (In contrast, distributions from your own IRA before age 59½ are subject to the 10% penalty tax unless an exception applies.)

What About Non-Spouses?
If you’re not the surviving spouse, you don’t have the option of rolling the 401(k) assets over to your own IRA. But thanks to the Pension Protection Act of 2006, you may be able to make a direct rollover of the 401(k) funds to an inherited IRA. A 401(k) plan isn’t required to offer this option, so check with your plan administrator. This new rule applies to distributions you receive after 2006.

The rules governing inherited 401(k) plan accounts are complex. A financial advisor can help you sort through the alternatives, and make the decision most appropriate for your individual circumstances.

Don’t Let a Vacation Wreck Your Budget

With today’s busy lifestyles, many people view a nice vacation every year as an entitlement, even if it means going into massive debt to pay for it. We understand the rationale…You work so hard all year and deserve a tropical break, especially after listening all winter about the fancy vacation plans of friends, co-workers, and neighbors. Of course everyone needs a break, and we all naturally want to have fond memories of endless summer days spent romping on the beach. But how can you keep those vacation costs from spiraling out of control?

Can You Really Afford It?
First, assess honestly whether you can afford the vacation you’re thinking about. If you have to borrow most of the money to pay for it, then you probably can’t afford it. If you do borrow to pay for your trip, you might find yourself financially strapped later on if the car dies or the roof starts leaking. At the very least, you’ll inherit the stress that comes with trying to pay off that debt.

Think Outside the Vacation Box
Not being able to take a dream vacation doesn’t mean you can’t take a vacation at all. Everyone needs time away from their job and normal family responsibilities to recharge. If you just don’t have the budget for the getaway of your dreams, then think of other creative ways to spend your time off. Here are some ideas:

• Try a few long weekends instead of one or two consecutive weeks. Perhaps you can afford a couple of nights at a hotel or bed and breakfast instead of all week. Or maybe you can camp for a few nights at a state or national park, where rates are very reasonable.
• Vacation from home. Take day trips into a nearby city and visit museums, restaurants, and other attractions. Or head out to the country for a hike, swim, and picnic. Doing things out of the ordinary, like eating breakfast three times a day or setting up a tent in the living room to play games and sleep in, can be a big hit if you have kids. (Most young kids usually just like being with their parents and are to tag along for whatever you have planned.)
• Let older kids pick an activity. It might not be Disney World, but what about a trip to an amusement or water park, a day or two at the beach, an afternoon canoeing or fishing, a movie and dinner outing, or a ballgame? Instead of lamenting the fact that you can’t take an exotic vacation, focus on what you can do and enjoy the time with your family.
• Consider house swapping. If you’re willing to trade houses with other like-minded families to save on room-and-board costs, there are several websites where you can find more information.

Plan Now for Next Year (or the Year After)
It’s never too early to start thinking about next year, or the year after that. Start saving now for that future getaway by making a budget and seeing where you might be able to squeeze a few dollars. Consider opening a separate “Vacation Account” for those funds; otherwise, the money may get lost in your regular savings account and used for other purposes. Where you put your money will depend on your time horizon and other factors. A qualified financial professional can help you examine your options.

If you can contribute monthly to your vacation fund, great. If you can’t, consider adding small windfalls like your tax refund, year-end bonus, or cash from birthdays and holidays. And when it comes time to actually plan your big vacation, keep cost-cutting travel tips in mind. For example, you might consider less convenient flights or a night or two at a less fancy hotel.

Forget About the Joneses
It’s tempting to want to take grand vacations every year when everyone else seems to be doing so. But don’t fall into the trap of thinking that you or your family will somehow be scarred if you can’t. The important thing is to relax in a way that you can afford, and then enjoy that time with your family. You will have taught your children an important lesson–how to live a financially sound life, without worrying about what the Joneses are doing.

The Buzz on Estate Tax

The Economic Growth and Tax Relief Act of 2001 gradually phases out the federal estate tax until its complete repeal in 2010. However, under the same law, the estate tax is scheduled to return in 2011.

Since 2001, there have been a number of failed attempts to make the estate tax repeal permanent. In fact, there are still several bills in Congress that include provisions to eliminate this tax. While it’s clear President Bush would sign such legislation, the recent changes in Congress make it less likely he’ll get the chance to do so. The question remains, though: Will permanent repeal become law, and if so, what are the potential ramifications?

Good-bye Estate Tax; Hello Capital Gains
Repeal does not mean that tax on wealth transfers from one generation to the next will disappear. While currently a tax is imposed on estates, after repeal, a tax will be imposed indirectly on inheritances in the form of capital gains tax. Here’s a simplified explanation.

Under the current tax system, property that is transferred to heirs at the owner’s death typically gets a “step-up” in tax basis to the current fair market value. Generally, tax basis refers to the cost the owner paid to acquire the property, and is used to compute capital gains tax when the property is sold.

On the other hand, when property is transferred by gift, the recipient receives a “carryover” basis; the tax basis in the hands of the person making the gift generally becomes the recipient’s tax basis.

One of the consequences of estate tax repeal in 2010 will be that the step-up in tax basis will be lost. Heirs will receive a carryover basis on inherited property, and will recognize the capital gain (or loss) when the property is sold at some point in the future.

The Impact on You
According to the IRS, estate tax affects only 2% of Americans. Capital gains tax, though, can affect anyone who owns capital assets such as real estate, buildings, and industrial equipment. Therefore, unless the step-up in basis remains, estate tax repeal is likely to result in creating a higher tax bill for a greater percentage of less-wealthy Americans. Further, repeal will create a paperwork headache for heirs who will have to determine the decedent’s tax basis in the property they’ve inherited.

Pros and Cons of Permanent Repeal
Proponents of permanent repeal regard the estate tax as morally unfair and an obstacle to family business continuity and growth. Critics call permanent repeal a boon to the mega-rich and fiscal suicide in a time of budget deficits, a Social Security and Medicare crisis, and war. The confusing reality is that there is statistical evidence can support both sides…and you do remember what Mark Twain said about statistics right?

One thing is certain: The uncertainty of our current estate tax is a burden on Americans and their financial planning which must re-evaluate estate planning options every year. For many on both sides of the issue, sensible reform is a preferable alternative to the success or failure of permanent repeal.

Outlook
In 2007, the Democrats regained power in Congress after 12 years of Republican control. The new Congress has been pursuing a fresh agenda and temporarily set estate tax relief on the back burner. When the issue does resurface, it’s likely that Congress will support reform over full and permanent repeal. Reforms such as lowering the estate tax rates to match capital gains tax rates and/or increasing the exemption amount have been proposed. Other options that have been discussed include doubling the exemption amount for married taxpayers, phasing out the tax over a five- or ten-year period, and replacing the estate tax with an inheritance tax (which would essentially shift the tax burden to the heirs). It remains to be seen what will be done, if anything.

Should You Pay Off Your Mortgage Early or Invest the Extra Cash?

Home ownership is a dream that many Americans share. However, a mortgage can be an enormous burden, and paying it off asap is the first item on many consumers’ to-do list. But competing with the desire to own a home “free and clear” is a need to invest for retirement, children’s college education, and other goals. Setting aside some extra cash for these goals may mean sacrificing other opportunities. So how do you choose?

Evaluate the Opportunity Costs
Deciding between prepaying your mortgage and investing your extra cash isn’t easy, because each option has advantages and disadvantages. But you can start by weighing what you’ll gain financially by choosing one option versus the others. In economic terms, this is known as evaluating the opportunity costs.

Here’s an example. Let’s assume that you have a $300,000 balance and 20 years remaining on your 30-year mortgage, and you’re paying 6.25% interest. If you were to put an extra $400 toward your mortgage each month, you would save approximately $62,000 in interest, and pay off your loan almost 6 years early.

By making extra payments and saving all of that interest, you’ll clearly be gaining a lot of financial ground. But before you opt to prepay your mortgage, you still have to consider what you might be giving up by doing so–the opportunity to potentially profit even more from investing.

To determine if you would come out ahead if you invested your extra cash,start by looking at the after-tax rate of return you can expect from prepaying your mortgage. This is generally less than the interest rate you’re paying on your mortgage, once you take into account any tax deduction you receive for mortgage interest. Once you’ve calculated that figure, compare it to the after-tax return you could receive by investing your extra cash.

For example, the after-tax cost of a 6.25% mortgage would be approximately 4.5% if you were in the 28% tax bracket and were able to deduct mortgage interest on your federal income tax return (the after-tax cost might be even lower if you were also able to deduct mortgage interest on your state income tax return). Could you receive a higher after-tax rate of return if you invested your money instead of prepaying your mortgage?

Keep in mind that the rate of return you’ll receive is directly related to the investments you choose. Investments with the potential for higher returns may expose you to more risk, so take this into account when making your decision.

Other Points to Consider
While evaluating the opportunity cost is important, you’ll also need to weigh many other factors. The following list of questions may help you decide which option is best for you.

• What’s your mortgage interest rate? The lower the rate on your mortgage, the greater the potential to receive a better return through investing.
• Does your mortgage have a prepayment penalty? Most mortgages don’t, but check before making extra payments.
• How long do you plan to stay in your home? The main benefit of prepaying your mortgage is the amount of interest you save over the long term; if you plan to move soon, there’s less value in putting more money toward your mortgage.
• Will you have the discipline to invest your extra cash rather than spend it? If not, you might be better off making extra mortgage payments.
• Do you have an emergency account to cover unexpected expenses? It doesn’t make sense to make extra mortgage payments now if you’ll be forced to borrow money at a higher interest rate later. And keep in mind that if your financial circumstances change–if you lose your job or suffer a disability, for example–you may have more trouble borrowing against your home equity.
• How comfortable are you with debt? If you worry endlessly about it, give the emotional benefits of paying off your mortgage extra consideration.
• Are you saddled with high balances on credit cards or personal loans? If so, it’s often better to pay off those debts first. The interest rate on consumer debt isn’t tax deductible, and is often far higher than either your mortgage interest rate or the rate of return you’re likely to receive on your investments.
• Are you currently paying mortgage insurance? If you are, putting extra toward your mortgage until you’ve gained at least 20% equity in your home may make sense.
• How will prepaying your mortgage affect your overall tax situation? For example, prepaying your mortgage (thus reducing your mortgage interest) could affect your ability to itemize deductions (this is especially true in the early years of your mortgage, when you’re likely to be paying more in interest).
• Have you saved enough for retirement? If you haven’t, consider contributing the maximum allowable each year to tax-advantaged retirement accounts before prepaying your mortgage. This is especially important if you are receiving a generous employer match. For example, if you save 6% of your income, an employer match of 50% of what you contribute (i.e., 3% of your income) could potentially add thousands of extra dollars to your retirement account each year. Prepaying your mortgage may not be the savviest financial move if it means forgoing that match or shortchanging your retirement fund.
• How much time do you have before you reach retirement or until your children go off to college? The longer your time frame, the more time you have to potentially grow your money by investing. Alternatively, if paying off your mortgage before reaching a financial goal will make you feel much more secure, factor that into your decision.

The Middle Ground
If you need to invest for an important goal, but you also want the satisfaction of paying down your mortgage, there’s no reason you can’t do both. It’s as simple as allocating part of your available cash toward one goal, and putting the rest toward the other. Even small adjustments can make a difference. For example, you could potentially shave years off your mortgage by consistently making biweekly, instead of monthly, mortgage payments, or by putting any year-end bonuses or tax refunds toward your mortgage principal.

And remember, no matter what you decide now, you can always reprioritize your goals later to keep up with changes to your circumstances, market conditions, and interest rates.

Modifying a Home for Disabled Accessibility

Because many homes aren’t designed to accommodate our parents’ and grandparents’ changing physical needs, it can be challenging for people with disabilities to live independently. Fortunately, homes can be modified to remove these barriers and to reduce reliance on caregivers. For older individuals, home modifications can delay or even prevent the need for costly care in a nursing home or assisted-living facility.

Improvement options will depend on individual needs and physical concerns. But here’s a broad look at some of the home modifications that might help make day-to-day living safer and easier for you or a loved one.

Inside the Home

Kitchen

• Remove cabinet doors to make it easier to see and reach items
• Use turntables inside cabinets to reach supplies easily
• Lower countertop surfaces and kitchen cabinets to make them more accessible
• Install a cook top and a low wall oven instead of using a range; install an adjustable mirror over the stove to make viewing cook top from a wheelchair easier

Bathroom

• Install a raised toilet with attached handrails (portable seats are also available if replacing the toilet is impractical)
• Cover sink handles with rubber grips to make it easier to turn the water on and off
• Install grab bars or poles near the toilet and shower
• Replace bathtub with low-threshold shower

Other living areas

• Replace door knobs with lever-style handles, or install door knob covers that are easier to grip and turn
• Add nightlights to prevent nighttime falls
• Remove throw rugs and thick doormats; replace padded carpet with thinner, level-loop carpet to prevent tripping and facilitate wheelchair or walker navigation
• Widen doorways, remove doors, or install special hinges that allow doors to open wider
• Install a ceiling lift device that will allow independent movement around the home
• Install a stair lift or an in-home elevator

Outside the Home

• Apply nonskid surfaces to garage floors, decks, stairs, and walkways
• Install handrails on both sides of stairs
• Replace standard exterior lights with motion-sensitive or photo-sensitive lights
• Construct an entrance/exit ramp

Paying for Home Modifications
Many home modifications are simple and inexpensive, but if you need to remodel extensively or hire a contractor, you may need help paying for improvements. Fortunately, financial help is available from public and private agencies and charities. For example, states and communities may offer special financing or grant programs, and charities often organize repair or improvement projects. To find help available in your community, contact your local Area Agency on Aging.

Tax Breaks
If you itemize deductions on your federal income tax return, you may be able to deduct home improvements that are primarily for medical care and prescribed by your doctor. However, if an improvement increases the value of your home, it may be only partially deductible.

Some states also offer tax breaks to their residents, including sales tax exemptions, deductions, or tax credits; local property tax credits or abatements may be available as well. For more information on these specific programs, talk to your local financial professional.

Should Young Adults Stay on Parents’ Health Plans?

While the axiom “necessity is the mother of invention” usually applies to the world of tangible goods, lately it applies to the world of health-care services, too. Rapidly escalating costs are forcing governments and the private sector to get creative to reduce the number of uninsured individuals. Solutions have ranged from health savings accounts to private high-deductible health plans to calls for universal coverage. Now comes another legislative trend: States are enacting an expanded definition of “dependent” that enables young adults to stay on their parents’ health plans well into their 20s.

What’s behind this trend?
It’s a typical scenario: “Children” are covered by their parents’ health insurance while they’re full-time college students, but after graduation, the “children” often decide they can’t afford their own health coverage. Instead, any discretionary income that could be used for health insurance is swallowed up by student loans, credit card debt, car insurance, and rent.

According to a 2005 published report from the U.S. Census Bureau (the latest year for which figures are available), about 30% of young adults ages 18 to 24 are uninsured, and more than 25% of individuals ages 25 to 34 lack health-care coverage. Along with the cost factor, it’s believed that many young adults choose to forgo health insurance because of the invincibility factor–they’re in relatively good health and just don’t expect to get seriously sick or injured.

Enter the states
To help this fastest-growing group of uninsured, a handful of states have passed legislation extending the time that a child may be considered a dependent for insurance purposes. Some states already extend this age if a child has a mental or physical disability. But now, states are expanding the age definition of dependent for purposes of health-care coverage with no requirement that a child be disabled. The typical age limit is 25 (though in New Jersey, a child can now remain on his or her parents’ health plan until age 30, if certain requirements are met).

States that offer this coverage typically allow private insurers to charge higher premiums and impose other restrictions (e.g., the child must be unmarried, reside in the state, live with his or her parents). Since extended health coverage is relatively new, it remains to be seen what other tweaks states will allow private insurers to make. For the most part, though, insurers have viewed this age demographic as an attractive risk due to the overall good health of this group.

Is the extra cost worth it?
Assuming the “child” meets the requirements, keeping him or her on the family health plan after college may be a good idea. For a few hundred extra dollars per month, the parent gains peace of mind knowing the child will be covered (and the parent will be off the hook) for that skiing accident or emergency appendectomy. Otherwise, an unexpected medical crisis could put a big crimp in the child’s financial future, and most likely the parents’ too.

Lending Money to Relatives

Loaning money to a member of your family may seem like the right thing to do. After all, what could go wrong? Your son, sister, father, or cousin really needs your help, and there’s no question that he or she will pay you back.

Or is there? Lending money to anyone, even someone you trust, is risky. No matter how well-intentioned the borrower is, there’s always the chance that he or she won’t be able to pay you back, or will prioritize other debts above yours.

When deciding, consider these tips:

• Don’t lend money you can’t afford to lose. If you make the loan, will you still be able to meet your savings goals? If the loan isn’t paid back, will the financial effect be small or large?
• Avoid becoming an ATM. Relatives (especially your children) may ask you for a loan because it’s convenient, but they may be able to obtain the money easily elsewhere. Explore other options first.
• Think through the emotional consequences. Will you be able to forgive and forget if loan payments are missed or if the loan isn’t paid in full? How hurt will you be if your relative freely spends money (on a vacation, for example) before paying you back?

Set the Terms
If you decide to go through with the loan, make sure expectations on both sides are clear. Discuss all terms and conditions and consider putting them in writing. You may even want to draft a formal loan agreement. At the very least, settle on the amount of each loan payment and the date by which the loan must be paid in full. Open-ended obligations often lead to misunderstandings.

On the other hand, don’t feel guilty if you decide to turn down your family member’s loan request. It’s hard to say no, but it’s still easier than repairing a damaged relationship if things don’t work out.

What is a Trust?

Our clients often ask would happen to their assets upon death, incapacity, transfer, or bankruptcy. We usually respond with an “it depends”, but at some point the conversation usually evolves into a discussion of trusts. A trust essentially helps you accomplish many estate planning goals. The power of a trust is in its versatility–many types of trusts exist, and each is designed for a specific purpose.

Living Trust
A living trust (also called an inter vivos trust) is a trust you create during your lifetime rather than after your death by the terms of your will (that type is called a testamentary trust). Living trusts are revocable–you keep control over the trust assets, and can change the trust or even dissolve it at any time. This type of trust is useful if you want assets to avoid probate and shield them from public scrutiny, and/or if you want to provide for someone else to manage your assets should you become incapacitated. Living trusts, however, will not minimize taxes or protect assets from creditors.

Irrevocable Trust
An irrevocable trust is one that, once created, you generally can’t change or dissolve, and you must give up total control over the trust assets. On the other hand, an irrevocable trust can provide certain tax advantages and asset protection. The following are all irrevocable trusts designed to achieve particular objectives:

Bypass Trust
When a person leaves his or her entire estate to a surviving spouse, assets pass free from federal estate tax because of the marital deduction.

QTIP Trust
A QTIP (qualified terminable interest property) trust (also called a marital deduction trust) is, like the bypass trust, used by spouses to minimize estate taxes. For maximum estate tax savings, a QTIP trust is often paired with a bypass trust. Because the first spouse to die names the ultimate beneficiaries, a QTIP is often used to provide for children of a previous marriage.

Irrevocable Life Insurance Trust (ILIT)
The proceeds of your life insurance policy will be subject to federal estate tax if you own the policy, or your estate receives the proceeds. Often, this asset pushes an estate over the exemption amount.

Charitable Remainder Trust
A charitable remainder trust allows you to give money or property to charity while continuing to receive income (fixed or variable) from the property for life or for a period of time up to 20 years. You and/or other beneficiaries receive distributions from the trust annually, and the charity receives the remaining assets when the trust ends. You get an immediate income tax deduction for the charitable interest (subject to limitations), as well as gift and estate tax deductions. You also avoid capital gains tax on the donated assets.

Trust a Team
If your head is spinning, don’t worry. A trust is not a do-it-yourself arrangement. Trusts should be properly structured and carefully drafted to achieve the desired results for your specific situation. Be sure to consult an experienced financial or legal professional to implement the best solution for you.

Hybrid Car: A Smart Purchase?

When it comes to safeguarding the environment, hybrid cars (vehicles that combine gasoline engines and rechargeable batteries) do have a positive impact. But how does owning one affect your wallet? While it may be too soon to tell, it seems that being green may cost more money than you’d expect.

Higher prices
The sticker prices for new hybrids average several thousand dollars higher than those for comparable cars with conventional engines. As a result, your initial out-of-pocket cost to purchase a hybrid can be significantly higher than for a conventional car. If you finance the purchase, that can translate into higher monthly loan payments or longer-term loans.

Tax credits offset the cost … for now
The federal government offers a tax credit (up to $3,400) for purchasing a new hybrid vehicle; the amount of the credit you receive depends on the car’s make and model. While this credit can at least partially offset a hybrid vehicle’s higher purchase price, timing is everything: Once a car maker sells 60,000 hybrids (of any model), the credit for all that manufacturer’s vehicles begins to phase out. At least one manufacturer (Toyota) has already exceeded the 60,000 mark.

The credit won’t reduce your tax liability below zero and, if you’re eligible for other credits, must be taken last in line. If the amount of the credit exceeds your tax liability, the difference generally can’t be carried over to another year. And the credit won’t reduce your alternative minimum tax (AMT) liability, if you’re subject to it.

Saving at the pump
One of the biggest selling points for hybrid cars is their fuel economy–more miles per gallon, which means you’ll save a bundle at the pump, right? Well, not always. It depends on how and where you drive. While you’ll get good gas mileage, real-world Environmental Protection Agency (EPA) results indicate that hybrids don’t always get the significantly better numbers claimed by manufacturers, especially if you’re a low-mileage, short-trip urban driver. And fuel savings are a function of gas prices: The higher the price per gallon, the more (and the faster) you’ll save. At lower gas prices, it takes longer to recoup your higher investment in the car.

Maintenance costs
Since maintaining a hybrid is essentially the same as maintaining a conventional car, these costs aren’t a significant variable in the savings equation. However, hybrid car batteries can cost $1,000 to $3,000 or more. While they’re covered by generous warranties (up to eight years), if you keep the car beyond the warranty, you might have to replace an expensive part.

Resale value
An important consideration in the cost-effectiveness equation is the resale value of the vehicle you purchase; if the car holds its value, it’ll cost you less in the long term. Because hybrids are relatively new, the jury is still out in terms of whether they’ll deliver greater relative resale values than their conventional counterparts. If they do, owning a hybrid may offer significant savings. However, hybrid technology is still improving, and this may adversely affect the resale value of the current models: Will a buyer want a used hybrid when new model hybrids may be more fuel efficient?

In the end, it’s about more than money
As each of us motors from point to point, every gallon of gasoline consumed sends 19 pounds of carbon dioxide into the atmosphere, and carbon dioxide is linked to global warming.

In the final analysis, a hybrid car purchase isn’t all about the dollars potentially saved. In fact, we have countless clients who own hybrid cars, and the least important consideration in their car-buying journey was cost. They ask us, “What’s the sticker price of a clean environment?”. Hybrid ownership is a badge of honor, a call to action for saving our Earth’s natural resources. They are proud of their courage to make a difference.

As a result of their thoughtful purchases, our hybrid-driving friends may not be saving a ton of money, but they are steadily saving tons of greenhouse gases. They proudly take that fact to the bank.

Birthday Freebies

Most people know that restaurants will give away a scoop of ice cream or a slice of pie to a birthday girl. But a free oil change from the local mechanic? Free movie rentals? A round of golf? Now we’re talking!

It’s Good to be You
Head on over to Slickdeals.net, one of our favorite sites for great shopping discounts, and you will find an entire bulletin board dedicated to free stuff you can only get on your special day. Hey, we’re for anything that keeps more dollars in your bank account.

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