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YOUR FINANCIAL FUTURE Your Guide to Life Planning November 2012

In This Issue

Kirsch & Associates Out and About (Jul - Sep) Kirsch & Associates - Out and About. Exciting events are happening at Kirsch & Associates and as part of our valued community we want you to be the first to know.

Preventing Identity Theft Millions of Americans fall victim to identity theft each year. What can you do to help reduce your chances of having your identity stolen? Joy D. Kirsch, CFP速 Kirsch & Associates 800-242-9480 2324A Cheek-Sparger Road Bedford, TX 76021 817-267-9480 jkirsch@kirschassociates .com

Charitable Giving Opportunities for Investors Donor-advised funds, family foundations, and charitable trusts are available to donors and their loved ones.

Ten Investment Mistakes to Avoid There are many ways to lose money. Here's a look at 10 proven ways to manage your stock portfolio into the ground in no time.

Plan Ahead for the What-Ifs By most measures, Mark and Jenny OConnors life goals were on track: college loans paid off, they had settled into fulfilling careers, married, had two kids and bought an affordable home in a growing community.


Your Guide to Life Planning

Kirsch & Associates Out and About (Jul - Sep) Welcome to Kirsch & Associates - Out and About. Exciting events are happening at Kirsch & Associates and as part of our valued community we want you to be the first to know.

Financial Planning Magazine Financial Planning Magazine once again asked Joy Kirsch to share her experience about how women process financial information, especially those going through a life transition. Featured as a Person of Interest in the article A Widow's Journey Coping with a Loss, Joy and a fellow Dallas widow shared their personal experiences about how the shock of widowhood impacted their ability to make decisions, including very important financial ones.

LPL Financial Focus Conference "Even the wisest mind has something yet to learn." ~George Santayana. At Kirsch & Associates, we are continually committed to providing the best comprehensive financial services. Joy Kirsch and Tony Pitzer attended the premier financial education conference of the year in August and returned with the latest cutting edge information to share with staff and clients.

Dallas Morning News Going local - Joy Kirsch was interviewed for an article in The Dallas Morning News. The story focused on her personal widowed experience and professional knowledge of working with widows as they face the emotional and administrative challenges presented during their journey.

The Widow's Journey Seminar Series September kicked off the first seminar in a monthly series for the non-profit called The Widow's Journey. Helping other widows has become both Joy Kirsch's vocation and avocation. At Kirsch & Associates, she developed a unique financial planning process for widows, and as part of giving back to the community, she launched The Widow's Journey.The goal of these seminars is to provide education, access to professional resources, and peer support to women that are caring for a terminal partner or are widowed. For more information click here.

Let's Get Social Looking for us online? Kirsch & Associates offers even more ways to stay connected and informed. Please friend, follow and subscribe to our social media sites by clicking on the links below. FACEBOOK: Kirsch & Associates TWITTER: @JoyKirsch YOUTUBE: Kirsch & Associates

The Widow's Journey is not affiliated with Kirsch & Associates or LPL Financial Because of the possibility of human or mechanical error by S&P Capital IQ Financial Communications or its sources, neither S&P Capital IQ Financial Communications nor its sources guarantees the accuracy, adequacy, completeness or availability of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. In no event shall S&P Capital IQ Financial Communications be liable for any indirect, special or consequential damages in connection with subscriber's or others' use of the content. Š 2012 S&P Capital IQ Financial Communications. All rights reserved.


Your Guide to Life Planning

Preventing Identity Theft Millions of Americans fall victim to identity theft each year -- and their financial losses are in the billions. In 2010 (the latest data available), an estimated 8.6 million Americans experienced identity theft, causing losses of $13.3 billion.1

You want to be on the lookout for phishing scams, particularly those that appear to come from a credit card company, bank, retailer, or anyone else you do business with.

What can you do to help reduce your chances of having your identity stolen? The steps below can help you prevent significant losses. Check your credit reports every year. You have the right to obtain a free copy of your credit report every 12 months from each of the three credit reporting bureaus -- Equifax, Experian, and TransUnion. Check thoroughly to ensure that there aren't any unidentified accounts on your report. Place a freeze on your credit reports. This can help stop an identity thief from opening a credit card account under your name. You simply contact the three credit bureaus and request a credit freeze. This prevents lenders who don't already have a relationship with you from viewing your credit report. If they can't access your credit report, they won't issue a new account. There is often a fee to request a freeze, depending on your state of residence and whether you've ever been the victim of identity theft in the past. Monitor your email. You want to be on the lookout for phishing scams, particularly those that appear to come from a credit card company, bank, retailer, or anyone else you do business with. Many of these emails will direct you to a phony website that will ask you to input sensitive data, such as your account numbers, passwords, and Social Security number. Be careful online. When banking or shopping online, be sure to use websites that protect your financial information with encryption, particularly if you are using a public wireless network via a smartphone. Sites that are encrypted start with "https." The "s" stands for secure. Also be sure to use anti-virus and anti-spyware software. What do you do if your identity is stolen? First, call one of the three credit bureaus and ask them to place a 90-day fraud alert on your credit report. They must contact the other two bureaus to place fraud alerts on your reports. You also want to get a copy of all three credit reports. Second, file a complaint with the Federal Trade Commission (FTC). You'll create an FTC Affidavit, which you should then take to your local police department and file a police report. Your copy of the FTC Affidavit and the police report make up an Identity Theft Report, which can help you: Get fraudulent information removed from your credit report. Stop companies from collecting debts caused by the theft. Get information about accounts that were illegally opened in your name. 1Source: Bureau of Justice Statistics, November 2011.

Š 2012 S&P Capital IQ Financial Communications. All rights reserved. 1-106888


Your Guide to Life Planning

Charitable Giving Opportunities for Investors When choosing the most advantageous charitable giving strategy, individuals must evaluate a number of factors, such as their need for current income, their desire to control and preserve assets during life and after death, their specific charitable intent, as well as important tax management issues. Charitable estate planning techniques can help achieve many of these objectives. Donor-advised funds, family foundations, and charitable remainder trusts (CRTs)/charitable lead trusts (CLTs) are available to individuals and their families. A donor's need for income in his or her lifetime and the need to reduce estate taxes are important factors in charitable giving.

Donor-Advised Funds A donor-advised fund is a tax-advantaged charitable giving vehicle that offers maximum flexibility to take tax deductions and recommend grants to charitable organizations. By definition, donor-advised funds are public charities under Section 501(c)(3) of the Internal Revenue Code, and contributions to such funds are tax deductible. Donor-advised funds are particularly family-friendly, as parents and children can consolidate their giving activities through a single fund account. In addition, children can be named as successors to a fund, ensuring the continuation of a family's giving legacy. Another significant advantage of a donor-advised fund is its capacity to accept any one of a variety of assets as a charitable contribution. Checks/wire transfers, commercial paper, mutual fund shares, securities, bonds, and restricted stocks all are acceptable assets.1 In addition, the account has the potential to grow over time, increasing the donor's giving power.

Family Foundations: Building a Legacy, Reaping Tax Benefits A family foundation derives its assets from the members of a single family, in which the donor and the donor's relatives play a significant role in managing the foundation. Aside from helping families channel their philanthropic ambitions, family foundations can form a legacy of community involvement and responsible citizenship for generations to come. As their founders soon realize, family foundations offer potential tax and estate planning benefits.

Private Foundations Versus Supporting Organizations There are two types of family foundations: private foundations and supporting organizations. Private foundations, the more common of the two, offer more flexibility and control (i.e., they can select and oversee their own board of directors and grantmaking decisions), while supporting organizations enjoy more favorable tax treatment. Gifts made to either type of family foundation are generally tax deductible from the donor's annual income tax, yet these deductions differ depending on the foundation's structure, the type of property or asset contributed, and the donor's income level. As a general rule, all gifts to a family foundation are removed from the donor's estate, avoiding estate or gift taxes.

Balance Giving Goals and Financial Planning While the tax benefits associated with charitable giving help reduce the cost of making charitable gifts, an individual's income or wealth transfer needs determine the ability to give. To address both goals, vehicles such as CRTs or CLTs are available. A CRT can guarantee a lifetime income stream for a donor and a spouse, while minimizing current income taxes. Donors generally may deduct the fair market value of a charity's remainder interest in the CRT during the year the CRT is funded. A CRT also can be an integral part of a family business succession plan. A donor can transfer stock to a CRT, and a closely held corporation may redeem the shares. The redemption funds the CRT with tax-free monies that subsequently can be invested to provide an income stream to the business owner and the spouse. A CLT provides control over and enjoyment of a donor's assets during the donor's lifetime, an estate tax deduction at death equal to the present value of the charity's future income interest, and a legacy to family heirs with potentially little or no estate tax consequences. Including charitable giving strategies within your estate plan can be an effective way for you and your family to enjoy an income stream during your lives, earn tax savings, and maintain a significant degree of control over assets. Be sure to consult an attorney or a financial advisor who can help you identify the strategies that are most appropriate for your situation.

1Investing in mutual funds involves risk, including loss of principal. Bonds are subject to market and interest


Your Guide to Life Planning rate risk if sold prior to maturity. Bond values will decline as interest rates rise and are subject to availability and change in price. Investing in stocks involves risks, including loss of principal. Š 2012 S&P Capital IQ Financial Communications. All rights reserved. 1-082917


Your Guide to Life Planning

Ten Investment Mistakes to Avoid Who needs a pyramid scheme or a crooked money manager when you can lose money in the stock market all by yourself. If you want to help curb your loss potential, avoid these 10 strategies.

The temptation to sell is always highest when the market drops the furthest.

1. Go with the herd. If everyone else is buying it, it must be good, right? Wrong. Investors tend to do what everyone else is doing and are overly optimistic when the market goes up and overly pessimistic when the market goes down. For instance, in 2008, the largest monthly outflow of U.S. domestic equity funds occurred after the market had fallen over 25% from its peak. And in 2011, the only time net inflows were recorded was before the market slid over 10%.1 2. Put all of your bets on one high-flying stock. If only you had invested all your money in Apple 10 years ago, you'd be a millionaire today. Perhaps, but what if, instead, you had invested in Enron, Conseco, CIT, WorldCom, Washington Mutual, or Lehman Brothers? All were high flyers at one point, yet all have since filed for bankruptcy, making them perfect candidates for the downwardly mobile investor. 3. Buy when the market is up. If the market is on a tear, how can you lose? Just ask the hordes of investors who flocked to stocks in 1999 and early 2000 -- and then lost their shirts in the ensuing bear market. 4. Sell when the market is down. The temptation to sell is always highest when the market drops the furthest. And it's what many inexperienced investors tend to do, locking in losses and precluding future recoveries. 5. Stay on the sidelines until markets calm down. Since markets almost never "calm down," this is the perfect rationale to never get in. In today's world, that means settling for a miniscule return that may not even keep pace with inflation. 6. Buy on tips from friends. Who needs professional advice when your new buddy from the gym can give you some great tips? If his stock suggestions are as good as his abs workout tips, you can't go wrong. 7. Rely on the pundits for advice. With all the experts out there crowding the airwaves with their recommendations, why not take their advice? But which advice should you follow? Cramer may say buy, while Buffett says sell. And remember that what pundits sell best is themselves. 8. Go with your gut. Fundamental research may be OK for the pros, but it's much easier to buy or sell based on what your gut tells you. Had problems with your laptop lately? Maybe you should sell that IBM stock. When it comes to hunches, irrationality rules. 9. React frequently to market volatility. Responding to the market's daily ups and downs is a surefire way to lock in losses. Even professional traders have a poor track record of guessing the market's bigger shifts, let alone daily fluctuations. 10. Set it and forget it. Ignoring your portfolio until you're ready to cash it in gives it the perfect opportunity to go completely out of balance, with past winners dominating. It also makes for a major misalignment of original investing goals and shifting life-stage priorities. 1Sources: ICI; Standard & Poor's. The stock market is represented by the S&P 500, an unmanaged index

considered representative of large-cap U.S. stocks. These hypothetical examples are for illustrative purposes only, and are not intended as investment advice. Š 2012 S&P Capital IQ Financial Communications. All rights reserved. 1-106886


Your Guide to Life Planning

Plan Ahead for the What-Ifs An emergency fund anticipates life's little surprises By most measures, Mark and Jenny O'Connor's life goals were on track: college loans paid off, they had settled into fulfilling careers, married, had two kids and bought an affordable home in a growing community. But then Mark lost his job as a project manager at a manufacturing company. Although the company severance package was generous, the job market in Mark's industry turned up few leads. The couple felt the loss of Mark's income within several months and they soon were short on cash. Financial advice columns bombard you with lists of things to do to achieve financial independence. Pay off high-interest-rate debt. Max out your retirement account. Don't rent, buy a house. But most experts agree the first thing most families should do, after meeting basic needs and reducing spending, is to start an emergency fund. What is an emergency fund? An emergency fund is money that you can quickly access and use only in case of emergency. It's not to be used to buy a new car or a leather recliner for the den. A true emergency is something that threatens your survival, not simply your need to be comfortable. Any situation that puts your ability to pay the mortgage or rent, or put food on the table is an emergency. The easiest way to set up an emergency fund is through your bank, putting a fixed amount each week or each month into a no-cost savings account. Make sure that you can access this account quickly and without paying a penalty. How much should I set aside? There is no one right answer. Do what works for you. Most experts suggest setting aside enough money to cover your mortgage and essential living expenses for two to three months. Others suggest having just $500 to $1,000 set aside is enough to handle most emergencies. On the other hand, if you are a highly paid manager, or are a couple that works in the same industry or company, you may want to sock away nine months to a year's worth of expenses in the bank. Once you have established this cushion, move onto other goals such as saving for retirement or your kids' college education. How do I get started? 1. Decide on how big a fund you need. Set up an interest-bearing account at a bank of at least $500 to $1,000. Don't carry a cash card tied to the account. 2. Pay down debt. Before you add any more to your emergency fund, pay off your credit-card balance or other installment debt. 3. Over time, build a three- to six-month financial cushion. Once your debts are paid down or eliminated, you should start building your emergency fund to be able to handle your basic expenses during a real hardship for up to half a year. Studies show that people who maintain an emergency fund are less likely to accumulate debt, which is essential for anyone saving for retirement or other important long-term goals. By taking this step now, you can reduce the likelihood of negatively impacting your future goals. Š 2012 Kmotion, Inc. This newsletter is a publication of Kmotion, Inc., whose role is solely that of publisher. The articles and opinions in this publication are for general information only and are not intended to provide tax or legal advice or recommendations for any particular situation or type of retirement plan. Nothing in this publication should be construed as legal or tax guidance, nor as the sole authority on any regulation, law, or ruling as it applies to a specific plan or situation. Plan sponsors should consult the plan’s legal counsel or tax advisor for advice regarding plan-specific issues.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and cannot be invested into directly.

The financial consultants of Kirsch & Associates are registered representatives with and Securities are offered through LPL Financial. Member FINRA/SIPC. Insurance products offered through LPL Financial or its licensed affiliates.

Not Bank/Credit Union Guaranteed Not Insured by any Federal Government Agency

Not FDIC/NCUA Insured

May Lose Value Not a Bank Deposit

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