Monday Morning Quarter-Buck 01-03-2017

Monday Morning Quarter-Buck


Amy's Blog

Okay, it's actually Tuesday, but it's a holiday week Monday!  This week's blog is part two of the random questions I've received in 2016, thus I've named it the "mailbag" blog B (part C will be next week).

Before I dig in to the questions, I thought I would share with you the new and improved logo for Irvine Wealth Planning Strategies.  This logo was designed by the creative folks at the Gaffer District – who have been absolutely amazing to me over the past year!

Are Christmas clubs a good idea?  When do you open them? What type of financial commitment is necessary?  Or do you have another recommendation for savings?

  • I do believe that a savings account for any big spending event is a good idea – be it Christmas, a new car, a vacation, any large purchase.  I think it comes down to personality to some extent - do you need the money to be "locked up" in order to make sure it is used just for Christmas?  If not, then a general savings account will do the same thing – the interest rate generally isn't any different. 
  • I recommend having "goal" accounts for those larger annual expenses.  For example, if you pay your auto and home owners insurance once a year, it's a big payment, but you usually save money by doing that – so I recommend dividing that payment by 12 and doing a monthly "payment" into that account.  It's the same with Christmas.  Setting a budget on what you will spend for the holiday, dividing it by 12 and making that "payment" ahead is also a great way to keep spending under control too.
  • You can open a savings account at any financial institution, but I tend to recommend Credit Union's, simply because they are member owned and usually allow multiple "goal" accounts under one member number.

 How long should you keep bank statements?

  • The answer to this question really depends on your situation.  Do you have access to the statements electronically if you need to pull them up for some reason?  Will your bank charge you for back statements if you can't pull them up electronically?
  • As a general rule, once you have reconciled the checks and/or receipts to your statement, theoretically you could discard them – unless there are some tax related items that you would need to provide documentation, in which case I would recommend keeping them with the tax return.
  • Also, if there is a situation where you or a spouse needed to be placed in assisted living and requested Medicaid, you will need to produce documentation as far as 5 – 6 years in arrears.  If you don't have them on file and your financial institution charges a fee for this, you may end up delaying the process and spending additional funds.

Can you have a retirement fund or IRA if you are disabled and receive Social Security Disability?

  •  It depends on the type of social security disability you are receiving. 
  • According to, if you are receiving Social Security Disability Insurance benefits, then yes, you can have a retirement fund or IRA and there will be no impact on the benefits. That is because this part of Social Security is meant to benefit those who have a long-term disability and can't work; additionally it is not based on available resources (such as an IRA).
  • However, if you are referring to Supplemental Security Income, all assets and income are considered in determining eligibility.   This part of Social Security is for low-income individuals with no (or little) resources.  Your IRA will be treated as a resource if you are applying under this category; therefore, you can be required to spend it down before the benefits kick in.