This is proving to be a tumultuous Fall. The date of September 11th will be forever anchored in our national conscience. We now have a new perspective on many of our concerns. This has been a time of national reflection and introspection. Our sympathy is extended to those most closely touched by the terrorist attacks.

Last summer in the “Tax Relief Act of 2001” (the title is an oxymoron in itself) a number of changes were made. The changes to the defined contribution retirement plans and education savings programs are important. This is not definitive (and more answers will be forthcoming) the following paragraphs give you a snapshot of the changes that affect most people.

These are some of the ways in which I can assist your family to plan for reaching your financial goals.

¨ The Salary Deferral Plans (SAR-SEP, 403-b, 401-k, 457) are no longer limited to a percentage of income calculation (i.e., 15% or 20%). You can defer up to 100% of salary up to $11,000 in 2002. And now, age has its benefits! Those age 50 and over can defer an additional $1,000 for a total of $12,000. This means a 50-year-old working part time at a non-profit agency making $13,000 a year can defer $12,000 into their 403-b plan.

¨ The SIMPLE Plan limit goes from $6,500 to $7,000 in 2002. Plus, those age 50 and over can defer an additional $500 for a total of $7,500.

¨ The IRA limits for Traditional and Roth IRA’s go from $2,000 in 2001 to $3,000 in 2002. Again, those who have attained the big five-0 can add another $500 to their account.

¨ The 529 Plan for Education is a phenomenal opportunity to secure tax-free growth for your family. The donor retains control of the account and can change the recipient. This means that if “junior” wants to buy a Corvette and join the French Foreign Legion, you can nix any withdrawals. You can change the recipient to junior’s sibling or to their cousin. There is considerable control in early funding on this tax-free growth account. Starting in 2002, withdrawals from a 529 Plan for education are tax-free.

On a personal note, many of you know my children. Jason, my Olympic hopeful speedskater, made the Fall World Cup Team in the 5,000 meter and 10,000 meter races. Jason plans to join me in business when he “retires” from competition. Amy, our scholarly daughter, is volunteering at an orphanage in Bogota, Colombia for a year (her fourth time there). I am delighted with both of my children. Attending financial conferences and following my children around the world take up most of my out-of-the-office time.

Have a marvelous year-end. Let the coming holidays be filled with joy and significance. Let us stay in touch. Relationships matter.

Gratefully,

Dale W. Hedstrand

Return to top of page

2nd Quarter, 2001

Retirement – There are a number of strategies to explore in designing a plan for the retiree. The new stretch IRA options, the potential for a conversion Roth and other choices can make retirement planning inundating to the uninformed. The newly designed 529 Plans offer an exciting choice for planning the estate of the retiree. As I write this letter, there are several changes in retirement accounts pending in Congress.

I will keep you informed as these changes are passed and ready to implement.

When you call us you may visit with Sam Rossi, our newest addition to the Focal Point staff. Sam comes to us with a wealth of investing and planning experience. Sam, Phyllis, Joan and Mary are available to serve you. I want you to know how much I appreciate each one of you.

As always, I deeply appreciate your referral to family and friends. Have a wonderfully delightful summer.

Return to top of page

1st Quarter, 2001

"How do I provide financially for my children, grandchildren, and other special children in my life?" Let me address financially simple ways to invest for minors.

One – Transfer to Minors Account. These are UTMA (Uniform Transfer for Minors Act) and the UGMA (Uniform Gift to Minors Act) accounts. This is the most common type of accounts for minors. It can be established by virtually any adult for the selected minor. One adult is the custodian on the account. The account is registered using the Social Security number of the minor. UTMA and UGMA accounts provide a modest tax advantage for the custodian.

Two – Education IRA. This is for those with adjusted gross incomes of less than $100,000. The annual maximum contribution per minor's account is $500. There is no tax deduction on the contributions. If the money is used for qualified education expenses, there is no tax on the money when taken out. Congress established the Education IRA a couple of years ago when they set up the Roth IRA plans.

Three – 529 Plan Accounts. These are newer funding options. The second generation of 529 Plan accounts is now available and much improved from some of the earlier attempts. This plan allows for up to $50,000 per year to be placed into a special account. It grows tax-deferred for the minor and will be taxed at their rate (presumably lower than the donor's rate) when it is withdrawn.

I can assist you with establishing any combination of these three accounts. They provide an excellent way of financial planning for that special young person in your life. College and future career options, estate planning and investment management are all brought into focus at our office.

Regarding the current market volatility: we can look at complementary and alternative investment possibilities with you. I see the current market cycle as a great time to 'buy low'. Yogi Berra would likely add, "You'll never get on base sitting on the bench!" Volatility is one reason investors are rewarded.

Let's stay in touch. Generally, it works better for you to call me with questions rather than for us to call you at potentially awkward times. Your referral of our services to family and associates is deeply appreciated.

Graciously,

Dale W. Hedstrand

P. S.: Remember that a calendar year 2000 Roth IRA can be established and funded until April 15, 2001.

Return to top of page

January, 2001

Remember it was the IRS that designed the acronym for this plan: Savings Incentive Match PLan for Employers. The acronym should be "SIMPE", but that didn't sound right. Thus is born the SIMPLE plan.

Congress made some inflation adjustments to various retirement plans. You now have the option of deferring up to $6,500 into your SIMPLE plan for the 2001 calendar year. The limit was raised by $500.

A couple of additional notes. As the infamous Yogi Berra would say: "You can't get on base sitting on the bench. Ya gotta be in the game." The same is true of investing. Investors are generally rewarded for being patient, but

A strategy used to tweak your retirement plan is to boost your salary deferral early in the year. Since the SIMPLE plan is not a function of a "percentage of salary" calculation, the $6,500 maximum contribution can be made early in the year. Making your contribution early in the year can add months to the time your contribution can grow tax deferred.

Let's have a great New Year together. Call us with any inquiries. I am honored when you refer friends, family and associates to me for service.
My direct line is (651) 426-7375 and the national toll free line is
(888) 426-7373.

Return to top of page

Archive Newsletters

1998 | 1999 | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007

NOTE: Dale Hedstrand is a registered principal associated with AIG Financial Advisors, Inc., Member NASD/SIPC. Before proceeding further, please be advised that Dale Hedstrand is licensed to discuss with or offer investment and financial services and products only to residents of AL, AZ, CA, FL, ID, MD, MI, MN, MO, NH, NM, ND, OH, OK, OR, SC, SD, TX, UT, VA, WA, WI, WY. Securities related services may not be provided to individuals residing in any state not listed above. The information offered is for informative purposes only. None of this information is to be construed as an offer to buy or sell securities referred to within or otherwise. Neither Dale Hedstrand nor AIG Financial Advisors, Inc makes any guarantee as to the accuracy or completeness of this information.

This information has been prepared from sources and data believed to be reliable but is not guaranteed by NASD/SIPC or AIG Financial Advisors, Inc., nor is any representation made herein as to its accuracy or completeness. This listing is provided for information purposes only and is not to be construed as an offer to buy or sell any securities mentioned herein.

We do not endorse any business or product you may find as a result of these links. The links were chosen as a sample of what the Internet has to offer. We caution you: do not enter into any agreement or purchase anything via the Internet until you and your advisors are satisfied that you are getting what you are paying for.