Apprise’s Five Favorite Reads for the Week of July 7, 2024

financial independence
Our five favorite reads from the last three weeks. Plus: What Does Financial Independence Mean to You!

What Does Financial Independence Mean to You?

I hope everyone enjoyed the Fourth of July holiday. I also hope this week’s blog gets you thinking about your financial “independence” and how our Life-Planning process can help you feel more confident about your money.

According to a recent poll of 2,000 U.S. adults, “financial independence” equates to earning $94,000 annually, or about $20,000 more than 2023’s median income.

Some of you might feel like you’re just a promotion or two away from achieving that kind of independence. Others might not feel like $94,000 isn’t enough to feel truly free. And still others might wonder how they could even spend that much money in the first place.

That’s because true financial independence isn’t a number. It’s feeling confident enough in your money to do things that will improve your Return on Life, such as:

1. Spending without worrying.

In our experience, it’s true that money can’t buy happiness. But it’s also true that knowing you can treat yourself and your family without worrying about paying your credit card bill at the end of the month feels great, too.

No matter what you earn, setting a monthly spending budget can help you cover your necessities, save toward your retirement goals, and have a little fun along the way. A budget can also help you plan for responsible “big ticket” splurges, like a dream vacation or adding a pool to the backyard.

2. Enriching your children.

Unless your kids love spending a lot of time at the local library, enrichment isn’t free. According to Lending Tree, parents spend an average of $731 per child per year on extracurricular activities. You might spend thousands of dollars annually on a good athlete or ballerina through their teenage years … which is when the big bills start rolling in. On average college tuition and fees for the 2023-24 school year were $10,662 at an in-state public school and $42,162 at a private school. It can cost significantly more once you include room and board and other expenses.

Parents might not feel truly free until they’ve finished paying for college. Two of our four kids have graduated. The third is more than halfway through. The fourth starts this fall. That makes the goal of paying for their education feel a lot closer to the end than the beginning. We still have more to go though. Having a goal in mind helps us to help you start planning for a combination of savings and investments that will reduce some of the sticker shock when the time comes. And by including some of your children’s activities in your budgeting and long-term plans, you might be able to sign them up for a few extra classes that round out their development or allow them to dig more deeply into their passions.

3. Changing careers.

Once upon a time, your high school guidance counselor might have challenged you to imagine what you’d do for a job if you didn’t need money. Setting aside your teenage dreams of being a rock singer, a professional athlete, or an astronaut, do you have the means to make that switch right now?

Well, if money isn’t stopping you, then what is?

Taking a lower-paying job at a company or charitable organization that does work you admire could allow you to put your professional skills to their highest use. Rather than trying to climb a ladder or earn a bigger paycheck, you can focus on the mission at hand and the people and causes you’ll be impacting.

Believe me. This can be done. It helps if you have some savings to get you through the rough spots. After that, I suggest having a plan and envisioning what it looks like. Having a vision of what you want to achieve can help you reach your goals.

4. Retiring.

Or maybe you’re feeling independent enough to stop working altogether.

If you plan your retirement around hitting some arbitrary financial number, you will likely put off retirement longer than necessary. We prefer to use our life-planning process to help folks envision the retirement they want, and then work to create a Life Plan supporting those goals.

Seeing how that plan can make your Ideal Week in Retirement possible while also providing for long-term goals like vacationing or relocating could give you the security you need to feel financially independent. If you would like some help, please schedule a meeting, and we can start planning to earn more return on life and more freedom from your money.

We try to help you find the balance between planning and enjoying the moment with our Life Planning process. Please schedule a call if you would like to discuss your life plan or any other aspect of your financial life.

This Week’s Favorite Reads

This week’s favorite reads include articles discussing the pros and cons of SEP IRAs and Solo 401k’s, the benefits of living a life that aligns with your values, and the junk fees appearing on traveler’s bills this summer. You’ll also find another discussing social media use among adolescents. The last article discusses the tax benefits related to qualified charitable distributions from your IRAs.

Here are the links to this week’s articles as well as a brief description of each and why you should check it out:

1. SEP IRA vs. Solo 401(k): Which Is Better?

Being self-employed doesn’t mean you still can’t save for retirement. You can own a small business, have a side hustle, or receive 1099s as a freelancer or gig worker. Any of these will allow you to save for retirement. There are two primary ways to save. You can have a SEP IRA or a Solo 401(k). We often discuss these accounts with clients, as they are specifically designed for the self-employed.

SEP IRAs are easier to set up and administer, you don’t have to contribute annually, and you can make Roth contributions. On the other hand, a Solo 401(k) allows you to make employee and employer contributions. These contributions can be higher as they are not based on a percentage of income. You can also make catch-up contributions if you’re age 50 or older. With a Solo 401(k) it can also be easier to make backdoor Roth conversions (not discussed in this article). There are cons to each as well. Although the article does not mention it, if the balance in your Solo 401k is at least $250,000, you must file an additional tax form – usually Form 5500-EZ. The best choice varies from individual to individual. Please schedule a call if you would like to discuss which might be best for you.


Life planning is about living your most fulfilling life. It helps to align your use of resources (Time, Energy, Attention, and Money or your TEAM) with your values. Working on your life plan can help you understand what you value the most. As stated in this article, “Living in alignment with your values brings a sense of contentment, satisfaction, or happiness.” How will you feel if you do more things that satisfy you and fewer things that don’t? You’ll probably feel better. You’ll also develop a greater sense of gratitude and a feeling things are going well in your life. The article goes on to suggest some ways you can live your values.

3. Travelers are drowning in junk fees during the summer of surcharges.

Beware of junk fees. You will likely come across many of them if you travel this summer. These fees are hidden, mandatory extras that get added to your final bill. Over recent months, these charges have grown in both size and amount. Many travelers are complaining. Even the government is waging a war against them. However, businesses continue to levy them. Why? Fooling customers into paying them benefits their bottom line. In addition to providing more information about junk fees and why there are so many of them, the article offers some tips to help you avoid them. You’ll even find some suggestions as to what to do if you still get hit with these fees.

4. U.S. Surgeon General Calls for Warning Labels on Social-Media Platforms.

Last week, I took our daughter to her college’s summer orientation – she starts in the fall. During one of the presentations to parents and incoming students, the point was raised that there are 168 hours per week (seven days x 24 hours/day). Say you sleep an average of eight hours a night. That leaves 112 hours. The typical college student is in class for about 12 hours a week. (Five classes with 2.5 hours of class time each.) That leaves 100 hours. Add in time to eat, time for personal care, exercise, and other required activities, and you still have 70-80 hours remaining. If you’re in school, you must include time for studying. That leaves at least 50 hours. For some, it could be closer to 70.

The question is, “What do you do with that time?” Many spend a large block of the remaining time on social media. According to research cited in the article, social media is an important contributor to a growing mental health crisis among young people. “Adolescents who spend more than three hours a day on social media face double the risk of anxiety and depression symptoms, and the average daily use in this age group, as of the summer of 2023, was 4.8 hours. Whether they’re living at home or away at school, limiting how much time our kids spend on social media isn’t easy. Considerable research suggests too much social media time negatively impacts our kid’s well-being. Do you ignore these warnings or do something about them? It’s not an easy answer. Please share your thoughts on this issue in our LinkedIn poll.

5. QCDs Are a Tax-Smart Way for Retirees To Donate to Charity.

In previous blogs (such as this one), we have discussed ways women facing new beginnings can make their charitable giving more tax-efficient. Qualified Charitable Distributions (QCDs) represent one of my favorites. QCDs allow those aged 70.5 years or older to reduce their tax bill. How? A QCD represents a donation directly from your IRA (this does not work with 401k’s) to a charity. In 2024, your QCDs can total up to $105,000. Spouses who also have IRAs can contribute a similar amount. Why make QCDs? 1. QCDs are not taxable to you. 2. They are not added to your adjusted gross income. This means they can help mitigate surcharges on your monthly Medicare premiums (such as IRMAA). They also provide a greater tax benefit than an itemized deduction. 3. They can represent some or all of your annual required minimum distributions (RMDs).

Our practice continues to benefit from referrals from our clients and friends. Thank you for your trust and confidence.

If you would like to talk to us about financial topics including facing new beginnings, managing your investments, creating your life plan, or saving for retirement, please complete our contact form or schedule a call or a virtual meeting via Zoom. We will be in touch.

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