Jean Keener
Jean Keener
Welcome to the inaugural issue of the KFP newsletter!  Each month I will provide financial tips and update you on any legislative changes that may affect your financial situation. 

You're receiving this newsletter because you've either directly subscribed, we're connected on LinkedIn, or we've crossed paths in the past and I thought you would be interested.  If you don't want to receive these, please unsubscribe -- no hurt feelings!  If you have a friend who didn't receive this and is interested in receiving financial updates, please forward this e-mail so they can join my mailing list.  I promise not to share their contact information (or yours) with anyone.

Feel free to e-mail me at with requests for topics you'd like to see covered.  Thank you, and enjoy the newsletter.
October 15 Deadline to Qualify for Stimulus Checks
Time is an issueOctober 15 is the final deadline to file your 2007 tax return, and you must file a return to receive your stimulus check.

As a result of the Economic Stimulus Act signed into law earlier this year, individuals who file a 2007 federal income tax return, and have $3,000 or more of qualifying income (including amounts received from Social Security and certain veterans benefits) may be eligible for a stimulus payment, provided that they have a valid Social Security number and can't be claimed as a dependent by someone else. (Individuals who have a spouse in the military do not need to have a valid Social Security number.)  Click here to read more.
In This Issue
Near Deadline for Stimulus Checks!
FDIC Insurance Limits Raised
Ask the Financial Planner at TDMN
Staying Sane in a Crazy Market
Should You Roll Over Your 401(k)?
Join Our Mailing List!
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FDIC Insurance Limits Raised
The bail-out bill that passed congress last week included a provision to increase the FDIC coverage limits from $100,000 to $250,000 per individual per bank.

This increase went into effect immediately, but it's important to note that it's only valid for 1 year.  For that reason, if you are keeping deposits in different banks to ensure FDIC coverage, you may not want to consolidate them now because you would likely just need to move everything around again next year.  For more on FDIC insurance, click here.
Ask the Financial Planner at The Dallas Morning News
October 6 - 12 is National Financial Planning Week.  In recognition of this week, Pamela Yip at The Dallas Morning News hosted an "Ask the Financial Planner" session through call-in and chat on Sunday, October 6.  I participated in the chat session, and we answered questions on annuities, bankruptcy, FDIC insurance, safety of investments, retirement income, and more.  Check out the transcript on
Five Steps for Staying Sane in a Crazy Market
Keener Financial Planning The market has been crazy lately!  If you've watched your 401(k) balance go up and down (mostly down!) on a daily basis, it's been more than a little nerve wracking.  A key part of managing your money is managing your emotions, particularly when the stock market is going through a period of uncertainty. Being able to keep your cool is one of the most valuable skills you can have as an investor.  Here are 5 Tips to help you manage.

Stay on course by continuing to save

Even if the value of your holdings fluctuates, regularly adding to an account that's designed for a long-term goal may cushion the emotional impact of market swings. If losses are offset even in part by new savings, the bottom-line number on your statement might not be quite so discouraging.

If you're using dollar-cost averaging--investing a specific amount regularly regardless of fluctuating price levels--you may be getting a bargain by buying when prices are down. However, dollar-cost averaging can't guarantee a profit or protect against a loss, and you should consider your financial ability to continue purchases through periods of low price levels.

Stick with your game plan

Solid asset allocation is the basis of sound investing. One of the reasons a diversified portfolio is so important is that strong performance of some investments may help offset poor performance by others. Even with an appropriate asset allocation, some parts of a portfolio may struggle at any given time. Diversification can't guarantee a profit or protect against a loss, but it can help you balance risks.

Look in the rear-view mirror

If you're investing long term, sometimes it helps to take a look back and see how far you've come. If your portfolio is down this year, it can be easy to forget any progress you may already have made over the years, though past performance is no guarantee of future returns.
Think about why you made a specific investment in the first place. That can help you determine if it still deserves a place in your investing strategy. Understanding how a specific holding fits in your portfolio also can help you consider whether a lower price might actually represent a buying opportunity. If you don't know an investment's purpose in your overall strategy, now's the time to find out.

Remember that everything's relative

Most of the variance in the returns of different portfolios is generally attributable to their asset allocations. If you've got a well-diversified portfolio, it could be useful to compare its overall performance to relevant benchmarks. If you find that your investments are at least matching those benchmarks, that realization might help you feel better about your overall strategy.

Remind yourself that nothing lasts forever

Ups and downs are normal for the stock market. If you regret not selling at a market peak, or missed a bargain, remember that you're likely to have other opportunities at some point. Having predetermined guidelines for buying and selling can prevent emotion from dictating investment decisions.
Should You Roll Your 401(k) Money into an IRA?
Person Thinking
If you're entitled to a distribution from your 401(k) plan (for example, because you've left your job), and it's rollover-eligible, you may be faced with a choice. Should you take the distribution and roll the funds over to an IRA, or should you leave your money where it is?  Some things to consider:

Universe of Investment Choices

In contrast to a 401(k) plan, where your investment options are limited to those selected by your employer (typically mutual funds or employer stock), the universe of IRA investments is virtually unlimited. For example, in addition to the usual IRA mainstays (stocks, bonds, mutual funds, and CDs), an IRA can invest in real estate, options, limited partnership interests, or anything else the law (and your IRA trustee/custodian) allows. (Certain investments may not be right for everyone, and some may have adverse tax consequences, so be sure to consult your financial professional.)

While the investment flexibility that IRAs provide can be a benefit for some people, it may be a drawback for others. If you lack investment knowledge and experience, you may be more comfortable with the limited investment alternatives your 401(k) plan provides.

Distribution Options

The distribution options available to you in a 401(k) plan are typically limited, usually to a lump-sum payout, or installments payable over a period of years. And many plans require that distributions start if you've reached the plan's normal retirement age (often age 65), even if you don't yet need the funds.

Similarly, 401(k) plans often require that a beneficiary take a lump-sum payment shortly after the plan participant dies. This may not be a problem if your beneficiary is your spouse--he or she can roll the funds over to an IRA after your death. But a nonspousal rollover is possible only if your 401(k) plan allows it. And some don't, forcing your beneficiary to take a distribution he or she may not yet need.

On the other hand, you can access the funds in an IRA at any time. You--and your beneficiary after your death--can take out as much, or as little, as you want. While you'll need to start taking required minimum distributions (RMDs) after you reach age 70 (and your beneficiary will need to take RMDs after you die), those payments can generally be spread over your (and your beneficiary's) lifetime. (You aren't required to take any distributions from a Roth IRA during your lifetime, but your beneficiary must take RMDs after your death.) A rollover to an IRA lets you and your beneficiary stretch distributions out over the maximum period the law allows, letting your nest egg enjoy the benefits of tax deferral as long as possible.

Note: Distributions from 401(k)s and IRAs may be subject to federal income tax. In addition, a 10% early distribution tax may apply if you haven't reached age 59. (Special rules apply to Roth 401(k)s and Roth IRAs.)

Shelter from Creditors

Your 401(k) plan may offer better creditor protection than an IRA. Federal law currently protects your total IRA assets up to $1,095,000--plus any amount you roll over from your 401(k) plan--if you declare bankruptcy. (The laws in your state may provide additional protection.) In contrast, assets in a 401(k) plan generally enjoy unlimited protection from your creditors under federal law, whether you've declared bankruptcy or not.

Ease of Tracking

Another reason to roll your 401(k) funds over to an IRA is to consolidate your retirement assets. This may make it easier for you to monitor your investments and your beneficiary designations, and to make desired changes. It also helps make it easier to maintain your desired asset allocation and rebalance periodically.  You may also want to consolidate all of your IRAs. However, make sure you understand how Federal Deposit Insurance Corporation (FDIC) and Securities Investor Protection Corporation (SIPC) limits apply if you keep all your IRA funds in one financial institution.

A Few Additional Considerations

While some 401(k) plans provide an annuity option, most still don't. By rolling your 401(k) assets over to an IRA annuity, you can annuitize all or part of your 401(k) dollars.

Many 401(k) plans have loan provisions, but you can't borrow from an IRA. You only can access the money in an IRA by taking a distribution, which may be subject to income tax and penalties.

If you were born before 1936, lump-sum distributions from your 401(k) may be eligible for special 10-year averaging or capital gains treatment. A rollover may make you ineligible for these tax rules.
I hope you found this newsletter information.  KFP offers a free, no-obligation get-acquainted meeting to start the financial planning process.  To learn more or schedule a time, call 817-993-0401 or e-mail
Jean Keener
Keener Financial Planning

Keener Financial Planning provides hourly, as-needed financial planning and advice on a commission-free basis to people at all financial levels.