Horizons Insurance andFinancial SvcsMauricio GiraldoDirector10620 Griffin Road -Suite 103Cooper City, FL 33328954-862-1735925-588-4078mauricio@thehorizonsfinancial.comwww.thehorizonsfinancial.com

Horizons - November 2019Tips for Managing Your Holiday SpendingTen Year-End Tax Tips for 2019What are continuing care retirementcommunities?Do independent living communities differfrom CCRCs?

Horizons - November 2019Planning Your FutureThree Regrets of Retirees

See disclaimer on final page

Dear clients and friends,I hope you find the content in ourNovember newsletter informative andhelpful.As we start the Holiday season, makesure you read the article "Tips forManaging Your Holiday Spending" - andshare it with family and friends.Remember that this is a season to bethankful and to share time with our lovedones....not to go on a shopping spree.I'd like to take this opportunity to thankyou for being our loyal clients andtrusting us with all your insurance andfinancial needs over the years. We hopewe are bringing value to you and that weare helping you protect your assets andaccomplish your financial objectives.As always, please do not hesitate tocontact us should you need anyassistance.Mauricio Giraldo

A recent survey foundthat more than half ofretirees haveretirement planningregrets. Unfortunately,many of these retireeshad to cut back ontheir lifestyles tocompensate forfinancial shortfalls.1

Considering their most common regrets mayhelp you avoid making the same mistakes.Not saving enoughMore than one-third of retirees wish they hadsaved more.2 How much is enough? Theamount you need depends on your othersources of income and your anticipatedretirement lifestyle.It might be helpful to consider the 4% rule, atraditional guideline for the percentage ofsavings that you may be able to withdraw eachyear without depleting your nest egg over a30-year retirement. For example, $100,000 insavings would provide only $4,000 in annualincome. If you will need $20,000 from yoursavings each year, you should have $500,000socked away by the time you retire.Withdrawing $40,000 annually might require $1million in savings.The longer you have before retirement, themore time you have to take advantage oflong-term savings and compounding ofpotential returns.If you have a workplace plan, you might start bysaving enough to receive any employer matchand then increase your savings percentage by1% each year until you reach 15% or more.You may need to target a higher percentage ifyou get a late start. Even if retirement is comingsoon, you might be surprised by how much youcan save if you focus on that goal.

Relying too much on Social SecuritySocial Security was never meant to meet allyour retirement income needs. The average2019 monthly benefit of $1,461 for a retiredworker and $2,448 for a couple would hardlyprovide a comfortable retirement. The 2019maximum worker benefit of $2,861 at fullretirement age would be better, but that wouldrequire maximum taxable Social Securityearnings for at least 35 years. If you postponeclaiming Social Security after reaching fullretirement age, your benefit increases by 8%annually. For example, if you were born in 1960or later, your full retirement age will be 67 undercurrent law, so working until age 70 wouldincrease your benefit by 24%.3According to the most recent trustees report,Social Security may be able to pay out only77% of scheduled retirement benefits beginningin 2034, unless Congress takes action tostrengthen the program.4 Considering theimportance of Social Security, it seems unlikelythat benefits will be reduced to that level, butthis is another reason not to count too much onSocial Security benefits for retirement income.Not paying off debtsCarrying heavy debt can be a strain at anystage of life, but it can be especially difficult forretirees living on a fixed income. Paying offyour home before you retire not only reducesyour monthly expenses but also provides equitythat could be tapped if necessary for futureneeds. Before paying off your mortgage,however, it might be wise to pay off credit cardsand other high-interest loans.The road to retirement can be challenging, butavoiding the mistakes made by those who havetraveled before you may help you reach yourdestination with fewer regrets.1-2 National Association of Plan Advisors, December8, 20183-4 Social Security Administration, 2019

Page 1 of 4

Tips for Managing Your Holiday SpendingLike almost everything else these days, theholidays have become a barrage of options andchoices, with nearly limitless opportunities tooverspend. Here are some tips to help youmake sure your family's spending remains incheck this holiday season.Develop a spending strategyFirst and foremost, develop a budget.Involving family members will help youestablish and maintain realistic expectations atthe outset. Remember to include not just gifts,but also holiday meals and parties, travel,greeting cards and stamps, gift wrap,decorations, and any other category you deemnecessary. This is also a good time to committo using cash or charging no more than you canpay off in one month.Next, devise a method of tracking all yourpurchases, receipts, gift recipients, and thelocations of hidden gifts that you mightotherwise forget about. This will make lifeeasier as the chaos ramps up.Review your credit cards to see if you haveany perks. Could you use earned points fortravel, or cash-back and gift card rewards tohelp defray costs?Track down old gift cards and put them touse now. If you think you'll never use them,trade them in for cash on a discounted gift cardwebsite. There, you can sell your old cards andeven buy new e-gift cards at a discounted rate,which you can then give as gifts or use for yourown purchases.Put technology to work for you. You can findapps that offer cash back if you shop online;alert you to online coupons available at nearbystores; round up your purchases to the nearestdollar and put the difference into a savingsaccount; and track your online purchases, scanother stores for better prices, and thenautomatically email the original stores on yourbehalf to take advantage of the price-matchguarantees. There are myriad options available,so be sure to check reviews andprivacy/security measures before downloading.Think creativelyGifts. Take time to carefully scan allpromotional materials before you head out thedoor or open a browser, because great dealsare often available for limited periods of time.For example, some stores have offeredgenerous gift cards in exchange for buyingcertain products on Black Friday.Consider giving experiences rather than gifts,which happiness experts say could lead tomore sustained levels of well-being. In fact, you

may find that you'll spend less overall by givingone or two memorable experiences instead ofthe usual pile of items.Create meaningful yet inexpensive gifts, suchas photo books, calendars, and family recipebooks, using online apps and services. Thisidea is especially appropriate for gifts fromchildren to older family members.For larger or extended families, make a gameout of gift giving. Consider a "Yankee swap," orimplement a gift exchange, where everyone israndomly assigned a person for whom they buyone special gift. Or consider having the entirefamily chip in a certain amount per person anddonating to a favorite charity or sponsoringanother family in need.Food. Nonperishable holiday-related goodstypically go on sale in late fall, so plan aheadand stock up. Also keep an eye out for specials;for example, some grocery stores offer a freeturkey around Thanksgiving when you spend acertain amount on groceries.Party planning, decorations, gift wrap.Consider buying the bulk of these supplies atdeep-discount stores and splurging on a fewspecial highlight items, such as napkins with anelaborate design, centerpieces of fresh flowers,or fancy bows. If you live in an area whereevergreens, autumn berries, and pine conesare plentiful, take advantage of this potentiallysophisticated, yet completely free, decor. Orcreate even more memories by hosting anornament-making party. Use old costumejewelry or other items to make ornaments anddecorations with sentimental value.Travel. During one of the busiest travel times ofthe year, deals can be hard to find. Here aresome tips:• Be flexible. If you can postpone your

celebration until after the holidays, you maybe able to save substantially on travel costs.(You can also shop the post-holiday sales forgifts!)

• Avoid airline baggage fees by using carry-onluggage.

• Use fare-tracking apps to find the best deals.• Cost-compare alternative modes of travel,

such as train and ridesharing.It's never too early to start savingFinally, get a jump on next year's festivities bystocking up on supplies during post-holidaysales, opening a savings account with a goal ofsaving at least as much as you spend this year,and shopping as early as possible to spreadspending throughout the year.

How much will you spendthis year?In October 2018, the NationalRetail Federation projected thatconsumers were planning tospend more than $1,000 onholiday-related purchases overthe entire season, which was a4% increase over 2017. For2019 figures, typically releasedin late October, please visit theorganization's website.

There's an app for that, too?You can even find an app thatwill help you locate your car inthe shopping mall parking lot.

Page 2 of 4, see disclaimer on final page

Ten Year-End Tax Tips for 2019Here are 10 things to consider as you weighpotential tax moves between now and the endof the year.1. Set aside time to planEffective planning requires that you have agood understanding of your current taxsituation, as well as a reasonable estimate ofhow your circumstances might change nextyear. There's a real opportunity for tax savingsif you'll be paying taxes at a lower rate in oneyear than in the other. However, the window formost tax-saving moves closes on December31, so don't procrastinate.2. Defer income to next yearConsider opportunities to defer income to 2020,particularly if you think you may be in a lowertax bracket then. For example, you may be ableto defer a year-end bonus or delay thecollection of business debts, rents, andpayments for services. Doing so may enableyou to postpone payment of tax on the incomeuntil next year.3. Accelerate deductionsYou might also look for opportunities toaccelerate deductions into the current tax year.If you itemize deductions, making payments fordeductible expenses such as medicalexpenses, qualifying interest, and state taxesbefore the end of the year (instead of payingthem in early 2020) could make a difference onyour 2019 return.4. Factor in the AMTIf you're subject to the alternative minimum tax(AMT), traditional year-end maneuvers such asdeferring income and accelerating deductionscan have a negative effect. Essentially aseparate federal income tax system with itsown rates and rules, the AMT effectivelydisallows a number of itemized deductions. Forexample, if you're subject to the AMT in 2019,prepaying 2020 state and local taxes probablywon't help your 2019 tax situation, but couldhurt your 2020 bottom line. Taking the time todetermine whether you may be subject to theAMT before you make any year-end movescould help you avoid a costly mistake.5. Bump up withholding to cover a taxshortfallIf it looks as though you're going to owe federalincome tax for the year, especially if you thinkyou may be subject to an estimated tax penalty,consider asking your employer (on Form W-4)to increase your withholding for the remainderof the year to cover the shortfall. The biggestadvantage in doing so is that withholding is

considered as having been paid evenlythroughout the year instead of when the dollarsare actually taken from your paycheck. Thisstrategy can also be used to make up for low ormissing quarterly estimated tax payments. Withall the recent tax changes, it may be especiallyimportant to review your withholding in 2019.6. Maximize retirement savingsDeductible contributions to a traditional IRA andpre-tax contributions to an employer-sponsoredretirement plan such as a 401(k) can reduceyour 2019 taxable income. If you haven'talready contributed up to the maximum amountallowed, consider doing so by year-end.7. Take any required distributionsOnce you reach age 70½, you generally muststart taking required minimum distributions(RMDs) from traditional IRAs andemployer-sponsored retirement plans (anexception may apply if you're still working forthe employer sponsoring the plan). Take anydistributions by the date required — the end ofthe year for most individuals. The penalty forfailing to do so is substantial: 50% of anyamount that you failed to distribute as required.8. Weigh year-end investment movesYou shouldn't let tax considerations drive yourinvestment decisions. However, it's worthconsidering the tax implications of any year-endinvestment moves that you make. For example,if you have realized net capital gains fromselling securities at a profit, you might avoidbeing taxed on some or all of those gains byselling losing positions. Any losses over andabove the amount of your gains can be used tooffset up to $3,000 of ordinary income ($1,500if your filing status is married filing separately)or carried forward to reduce your taxes in futureyears.9. Beware the net investment incometaxDon't forget to account for the 3.8% netinvestment income tax. This additional tax mayapply to some or all of your net investmentincome if your modified adjusted gross income(AGI) exceeds $200,000 ($250,000 if marriedfiling jointly, $125,000 if married filingseparately, $200,000 if head of household).10. Get help if you need itThere's a lot to think about when it comes to taxplanning. That's why it often makes sense totalk to a tax professional who is able toevaluate your situation and help you determineif any year-end moves make sense for you.

Timing of itemizeddeductions and theincreased standarddeductionRecent tax law changessubstantially increased thestandard deduction amountsand made significant changesto itemized deductions. It maynow be especially useful tobunch itemized deductions incertain years; for example,when they would exceed thestandard deduction.

IRA and retirement plancontributionsFor 2019, you can contributeup to $19,000 to a 401(k) plan($25,000 if you're age 50 orolder) and up to $6,000 totraditional and Roth IRAscombined ($7,000 if you're age50 or older). The window tomake 2019 contributions to anemployer plan generally closesat the end of the year, whileyou typically have until the duedate of your federal income taxreturn (not includingextensions) to make 2019 IRAcontributions.

Page 3 of 4, see disclaimer on final page

Horizons Insurance andFinancial SvcsMauricio GiraldoDirector10620 Griffin Road -Suite 103Cooper City, FL 33328954-862-1735925-588-4078mauricio@thehorizonsfinancial.comwww.thehorizonsfinancial.com

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2019

Horizons Insurance and FinancialServices, Inc does not providelegal, tax, or variable investmentadvice.

Do independent living communities differ from CCRCs?Independent livingcommunities, also known asrental retirement communities,offer housing options for activeseniors and retirees who

require little or no assistance with dailyactivities. Most independent living residentsdesire an environment where they don't have tobe concerned about safety, maintenance, andhomeownership responsibilities.One of the major offshoots of the burgeoningnumber of baby boomers retiring every day isthe growing retirement living industry. More andmore communities dedicated to senior living areopening each year. Two popular options arecontinuing care retirement communities(CCRCs) and independent living communities.While there are similarities between the two,there are important differences as well.Both CCRCs and independent livingcommunities may offer amenities such as aclubhouse, lounge, dining rooms, fitnesscenters, swimming pools, housekeepingservices, and transportation. CCRCs usuallyoffer a higher level of amenities and servicesthan independent living communities.The main difference between CCRCs and

independent living communities is the extent ofhealth-related, or continuing care, servicesoffered by CCRCs, which include assisted livingservices, memory care, and long-term care.Independent living communities typically do notoffer continuing care services. Instead, theresident may arrange for such services throughan outside agency. Generally, independentliving communities do not offer assisted livingservices or long-term care.Another difference between CCRCs andindependent living communities relates to thecosts. Most CCRCs require a substantial entryfee plus a monthly fee. Typically, independentliving communities charge a monthly fee,similar to rent. Independent living fees areusually not covered by any type of insurance,including Medicare and long-term careinsurance. However, health-related servicesand care that a resident receives (which are notoffered by the independent resident community)may be covered by insurance or Medicare.Determining which type of community is thebest choice depends on a number of factorsincluding the services needed or desired andthe costs associated with each type ofresidential community.

What are continuing care retirement communities?Continuing care retirementcommunities (CCRCs) areliving arrangements thatcombine independent living,assisted living, and nursing

home care on a single campus. CCRCs offerresidents a continuum of care throughout theirlives.Typically, you enter a CCRC as a resident of anindependent housing unit, which may be acondominium, apartment, or single-familyhome. When you need more care or are unableto live independently, you can move to theassisted living facility on campus. Should youneed the next level of care, you can move intothe on-site nursing home.While specific services and benefits may differ,communities generally offer dining facilities,transportation, lawn care, housekeeping, socialactivities, laundry, emergency call monitoring,and security. As needs arise, additionalservices may include preparation of meals,health services such as medical care, andpersonal care such as assistance with toileting,bathing, and personal hygiene.The fee arrangements for CCRCs vary andgenerally include both a monthly fee and an

entrance fee. These fees can be quitesubstantial depending on the location of thecommunity, the services offered and chosen,and the living arrangements desired. The entryfee may be fully or partially refundable, andmonthly fees may increase over time. Medicareand/or health insurance may pay for some ofthe services provided.There are three basic types of residentialarrangements for CCRCs:• Life care or extended contract. This option

offers unlimited assisted living, medicaltreatment, and skilled nursing care. Thisalternative is often the priciest because thereare typically no additional fees or charges.

• Modified contract. This contract is similar tothe life care option, except that only certaindefined services are included for apredetermined price and/or for a specifiedlength of time. Extra charges will apply if youneed additional services or are able to extendthe contract's time frame.

• Fee-for-service contract. While the initialenrollment fee may be lower, assisted-livingand skilled-care services are paid for at theirmarket rates.

Page 4 of 4