This retirement-savings plan is a good option for businesses with fewer than 100 employees.

By Kimberly Lankford, September 26, 2014

I read your Retirement Plans for Self-Employed Workers column about SEPs and solo 401(k)s. Who should consider a SIMPLE, and what are the contribution limits?

A SIMPLE (Savings Incentive Match Plan for Employees of Small Employers) is a retirement-savings account for small businesses. It’s designed for companies with fewer than 100 employees. If you’re self-employed, an SEP or a solo 401(k) is generally your best option. But if you own a business with employees and want them to be able to contribute to their accounts, too, a SIMPLE can work well.

“I think the ideal group for a SIMPLE is a profitable start-up company with several employees,” says Scott Bishop, a CPA and certified financial planner with STA Wealth Management in Houston. Bishop says that a SIMPLE is easy to set up and requires little paperwork. The plans are administered by many brokerage firms and mutual fund companies.

Employees can contribute up to $12,000 pretax to a SIMPLE in 2014; those who are 50 and older can contribute an extra $2,500. Employers can either match the employees’ contributions (up to 3% of their compensation) or contribute up to 2% of compensation for all employees, whether or not they participate in the plan. (You can’t have a solo 401(k) if you have employees other than a spouse, and with an SEP, only the employer can make the contributions for employees.)
Employers who would like to set up a SIMPLE need to act quickly — you must establish the account by October 1. For more details, see the IRS’s SIMPLE IRA Plan FAQs and SIMPLE IRA Plans for Small Businesses, as well as the Department of Labor’s SIMPLE IRA Plans for Small Businesses. For information about all kinds of retirement plans for self-employed people and small businesses, see Do-It-Yourself Retirement Plans.

Read more at http://www.kiplinger.com/article/retirement/T047-C001-S003-retirement-plans-for-small-businesses.html#1xviKjqpT0ym47cd.99

Reclaim your desk! We tell you which files to trash and which to stash — and the best ways to turn the keepers into digital records.

By The Kiplinger Washington Editors, April 2012
Keep all of your old tax returns, and hang on to the supporting documents for three years after a return’s filing due date — six years if you have self-employment income (some states require records from earlier years in an audit). Hold year-end investment statements and records of stock and mutual fund purchases as long as you own them. (For more on tax-related recordkeeping, see IRS Publication 552, Recordkeeping for Individuals.)

Keep records related to your current home, including proof of the purchase price and receipts showing what you’ve spent on improvements. (You can toss those documents three years after you sell the house.) Also keep files with information on contributions and withdrawals from IRAs and 401(k) plans — especially documents regarding nondeductible contributions, such as copies of IRS Form 8606, to avoid paying too much tax on withdrawals.

Trash bank withdrawal and deposit slips, credit card receipts and ATM receipts once you’ve compared them with your monthly statement; paycheck stubs after you check them against your Form W-2; and monthly bills for utilities, cable and credit cards, unless you need them for tax purposes. Shred any documents that include your Social Security number, account numbers or other information you wouldn’t want in the hands of an identity thief.
Digitize your records to keep paper clutter to a minimum. Save PDFs or scanned images of files on your computer and back them up on a flash drive or external hard drive, or snap pictures of receipts with your smart phone — the Shoeboxed app (for iPhone and Android) will organize them as IRS-accepted images in a secure and searchable archive.

Access your files from any computer with free, secure online storage options, such as Manilla.com (which organizes your bills and saves unlimited documents in the site’s secure database as long as you have an active account) or Windows Live SkyDrive (with 25 gigabytes of free space). Other options include the Amazon Cloud Drive and Apple iCloud (each with 5GB of free storage) and Dropbox.com (2GB of free space). Extra storage is available on all three for a fee.

Read more at http://www.kiplinger.com/article/real-estate/T029-C000-S002-toss-paper-files-you-don-t-need.html#1hMWIwYtZ8kRpIWe.99

Find out which documents you should hang on to and for how long.

By Kimberly Lankford, March 26, 2012
I just filed my taxes for 2012 and am planning to clean out my old files. What records should I keep, and what can I safely toss?

It’s smart to keep your tax returns indefinitely. Old returns can provide important background information in a variety of situations — for example, if you’re applying for a mortgage, applying for disability insurance or trying to figure out the cost basis of investments. The pages from your return don’t take up much space, and the records are easy to digitize, so you don’t need to keep the paper versions of your old returns.

Also keep records of your home’s purchase price and major home improvements for three years after you sell the home. Most people no longer need to pay taxes on their profits on a home sale: Single filers can exclude $250,000 in profits from income, and married couples filing jointly can exclude $500,000, as long as they’ve lived in their home for at least two of the past five years. But if you live in the house for less than two of the five years leading up to the sale, your gains may be taxable. In that case, your home-improvement records can substantiate an increase in your tax basis and a lower gain (the cost of basic repairs doesn’t count). For more information, see IRS Publication 523 Selling Your Home.

It’s a good idea to keep records of stock and mutual fund purchases made in taxable accounts for as long as you hold those investments. The records will come in handy when you sell the shares and must report the purchase price, date of purchase and number of shares involved. Also keep records of any stock or mutual fund dividends you’ve reinvested so you can avoid paying taxes on them again when you withdraw the money.

And hang onto Form 8606, on which you reported any non-deductible IRA contributions, until you withdraw all the money from your IRA. The record will help you avoid being taxed on the money again when you take it out in retirement. See Deductible Versus Nondeductible IRA Contributions for more information.

As for what to weed out, the IRS generally has up to three years after the due date of your tax return to begin an audit, so you can toss most of your supporting tax documents — such as canceled checks and receipts – as soon as the three-year period has passed. See IRS Publication 552 Recordkeeping for Individuals for more information about tax records.

You can also toss monthly statements from your bank and brokerage firm after you receive your year-end statements; get rid of ATM receipts and bank-deposit slips as soon as you match them up with your monthly statement; and dump pay stubs after seeing that they accord with your W-2 for the year (but you’ll want to save your December pay stub if it shows charitable contributions made via payroll deduction). Dispose of paper copies of your credit card, utility, phone and cable bills as soon as the next month’s bill arrives unless you need them for tax purposes (say, if the expenses can be deducted as self-employed business expenses or if you’re claiming the home-office deduction). See Tax Tips for Freelancers and the Self-Employed for more information. (You may want to keep utility bills for a few years even if you don’t need them for taxes so you can show prospective buyers the average monthly cost of your utilities.) .

Shred these documents before tossing them so an ID thief doesn’t end up with a goldmine of information about your bank account, credit cards and other personal information. See Your ID-Theft Prevention Kit for more information.

Read more at http://www.kiplinger.com/article/taxes/T056-C001-S001-which-tax-records-to-keep-and-which-to-toss.html#EzPyrLUiwhC5jy7A.99

Digitize your files in these tech-savvy ways to save money at the tap of an app.

By Lisa Gerstner, August 2012

If you have a smart phone, scanner and computer, you have all the tools you need to banish paper clutter from your life. We’ve rounded up ways to digitize records and receipts, as well as cut back on paper bills and financial statements. The payoff: You can more easily organize your files, photos and miscellaneous pieces of paper, and you’ll be able to access them with the click of a mouse or tap of an app. Plus, you are likely to save money on paper and printer ink.

1. Scrap the small stuff

Get a handle on paper receipts with tools that save and categorize them. With the free Lemon app (available for Android phones, the iPhone and iPad, and Windows Phone), you just snap a photo of a receipt and add a label—for example, “Personal” or “Business.” Lemon arranges receipts based on your labels as well as the type of spending the receipt reflects (such as “Food and Dining”), and you can view a breakdown of the information on the app and at Lemon.com. If you don’t have a smart phone, you can e-mail receipts to your account or enter information from receipts manually.

Shoeboxed, which manages receipts as well as business cards, caters to small businesses but can be helpful for personal finances, too. The online tool has applications for Android devices and the iPhone and iPad (you can e-mail photos to Shoeboxed from any phone with a camera and e-mail capability). Plus, it integrates with several outside accounts, such as Evernote and Google, so that you can export data into them. Send five documents per month to Shoeboxed to have a human verify, at no charge, that the data pulled from the images of the documents is accurate (receipts submitted through the phone app go through verification). You can have more documents verified with paid plans that range from $10 to $50 per month or $99 to $499 a year. But you can always upload documents directly to Shoeboxed.com and skip data verification to keep using the tool free.

Just looking to clear your desk of business cards? Get the free CamCard Lite app. Take a photo of a card and the app stores an image of the card and transfers the information to an address book (you can manually edit the info if the reader translates it incorrectly). You can also export contact information to other accounts, such as Google and Facebook. After downloading the app, registered users may scan 50 cards, and then three cards per week after hitting 50. The paid version of the app, Camcard ($11.99 for Android; $6.99 for iPhone and iPad; $3.99 for Windows Phone), allows unlimited scanning.

2. Manage bills

Forgoing paper statements and receiving and paying bills online are essential steps to going paperless. Many big banks offer online bill-paying services to help you track statements and pay bills on time. You can typically set up automatic payments from your bank account for recurring bills, such as utilities and credit cards. But watch for fees. For instance, Wells Fargo offers free online bill paying for the first two months you’re enrolled. After that, you’ll pay a $3 monthly fee unless you have an eligible checking account or maintain a $5,000 balance among qualifying accounts. TD Bank and U.S. Bank offer totally free bill paying.

Manilla is an appealing alternative or supplement to bill paying through a bank. The free Web tool supports more than 1,300 service providers and merchants, and provides access to all of your connected accounts through Manilla.com. You can set up e-mail or text alerts for approaching due dates and use the free app (for Android, iPhone and iPad) to see your accounts. Manilla automatically stores statements and bills in its secure database—and there’s no storage limit. Keep tabs on daily-deal coupons, travel rewards points, and magazine and Netflix subscriptions, too.

3. Scan and save

Ditching paper documents and archiving records electronically may leave you feeling uneasy about the legal validity of your records. But for files that you may need for tax purposes, you can rest easy: Digital copies are acceptable to the IRS. Use a scanner to convert paper documents, such as letters from charities and mortgage records, to digital files. To reduce paper in general, scan any other files you’re comfortable keeping in digital form.

Creating PDFs of documents and Web pages allows you to store them on your computer and open them easily. You may be able to make PDFs using the “Print” menu as you work within a document or Web browser. Tools such as PrimoPDF (available for Windows) let you create PDFs from many applications.

Some smart-phone applications specialize in scanning and creating PDFs of documents that you photograph using the phone’s camera. For the best results, you’ll need good lighting and a steady hand. CamScanner, which has free versions available for Android devices and the iPhone and iPad, can send images straight to Box, Dropbox and other online storage services. (Limits apply to the number of images you can scan using the free app; the $4.99 version allows unlimited scanning.) For iPhone and iPad users, TurboScan ($1.99) and JotNot ($1.99 for the paid version) are popular options.

4. Make online to-do lists

Other tools can fine-tune certain aspects of putting your digital life in order. For example, instead of jotting to-do lists on scraps of paper, try TeuxDeux, which lets you create them online. The site’s format is simple and clean, organized by day. You can drag items from one list to another and cross them off as you complete them. Have an iPhone? The $2.99 TeuxDeux app makes viewing and editing lists easier than doing so through the mobile browser.

5. Read it later

Most Web browsers let you bookmark pages. But to access them from multiple devices, you’ll want to use a Web tool such as Instapaper. Like TeuxDeux, Instapaper has a no-fuss format. At Instapaper.com, copy and paste links to the pages you want to save into a queue. Crave more bells and whistles? Delicious lets you categorize groups of articles into “stacks” and share them with others. For those who want to hold on to Web pages for the long term, Pinboard fits the bill. Pinboard charges a one-time sign-up fee, recently $9.80, based on the total number of users. And for $25 yearly, Pinboard saves content from Web pages indefinitely in a searchable archive. Even if the content goes offline, you’ll have a copy of it.

6. Get organized

You can save, organize and search through your digital stuff with Evernote. At Evernote.com, download the free application, which is available for computers and several mobile devices (including Android and BlackBerry phones, Windows Phone, and the iPhone and iPad). You can import e-mails, photographs and PDFs into the app, “clip” Web pages—including embedded links—to save for later, and type out notes. Add “tags” to each item to categorize your files and make searching easy. For $5 per month or $45 per year, Evernote Premium provides additional features, including the ability to see previous versions of notes and let others edit notes.

7. Back up and store

Along with saving documents to your computer, it’s smart to back up files on an external hard drive or flash drive, as well as in secure online databases—that way, you can gain access to your files anywhere you have an Internet connection. Many sites limit the amount of storage you can use free, but you can spread your files among several programs or pay for additional space if you need it. For a guide to online storage options, see Join the Cloud on the Cheap.

Read more at http://www.kiplinger.com/article/spending/T057-C000-S002-7-steps-to-convert-paper-files-to-digital.html#Ue0xUOdMIcyQFVAg.99

Digital files are your best weapon in the battle to conquer clutter.

By Lisa Gerstner, From Kiplinger’s Personal Finance, January 2014
1. Stop paper buildup in its tracks. Sign up to receive online statements and bills from utilities, banks, credit card issuers and other service providers. To help stay on top of payments, sign up for your bank’s bill-paying service. Or link your accounts to Manilla.com. The tool, which includes a mobile application for Android and iPhone, organizes and stores documents online and sends alerts when bills are coming due.
2. Scan, scan, scan. A good scanner can eliminate a mountain of paper. The Fujitsu ScanSnap iX500 desktop scanner ($405 on Amazon.com) connects wirelessly to your PC, creates searchable PDFs, and can handle two-sided scanning. Once you’ve digitized those documents, take them, along with all the other unwanted items sitting on your desk or dining room table, straight to the shredder. Your community may sponsor periodic mass shredding events. A good shredder for home use is the Fellowes Powershred W-11C ($66 at Amazon.com).

3. Prepare a backup plan. Save important documents in multiple places in case your computer fails, says Julie Bestry, president of Best Results Organizing, in Chattanooga. In addition to keeping copies on an external hard drive or a flash drive, store documents using secure “cloud” serv­ices. Dropbox, for example, lets you save 2 gigabytes of data free (and you can share folders with other users). With Google Drive, you can store up to 15GB of files as well as create text documents, spreadsheets and slide shows. The free online tool Evernote lets you save PDFs, clip articles from the Web and create text documents. File items in folders and add tags for easy searching.

4. File it on the fly. A scanner that fits into a bag or suitcase can be useful for, say, digitizing handouts while you’re at a conference, says Erin Rooney Doland, editor in chief of Unclutterer.com. For example, the 12-ounce Fujitsu ScanSnap S1100 ($180 on Amazon.com) can process letter-size documents as well as receipts, postcards and business cards. And plenty of mobile apps can help you keep paper to a minimum, too, though they may not provide the image quality that a scanner does. With the free version of the CamScanner app (for Android, iPhone and Windows Phone), you can snap photos of documents with your phone’s camera and convert them to PDFs. The CamCard Free app lets you photograph business cards and store and file the contact information. With the free Bump app (for Android and iPhone), you can share your contact information by tapping your phone with phones of other app users.

5. Get a handle on receipts. To organize all of your receipts and track spending, try OneReceipt for iPhone, which lets you snap pictures of receipts and save them by using the free app or e-mailing them to your account. The tool can also automatically pull electronic receipts from your e-mail account. Not sure the store will accept an image of a receipt? Hang on to the original.

6. Paper still has a place. In addition to Social Security cards, and certificates of birth, death and marriage, you’ll want to keep estate documents, medical records, insurance policies, proof of mortgage and other loan payoffs, and titles and deeds for cars and homes.

Read more at http://www.kiplinger.com/article/business/T057-C000-S002-6-things-to-know-about-going-paperless.html#PGYri2Ve9pjYVhtt.99

How to Protect Your Digital Content
Tips on safeguarding your files from hackers.

By Kaitlin Pitsker, From Kiplinger’s Personal Finance, June 2015
When your photos, slides and videos have been converted to digital files, your next task is to organize and store them so they’re backed up and safe from hackers, a virus or a technical mishap. This is also a good time to corral the digital photos scattered among various computers, phones and e-mail accounts.

Organize. Start by collecting the digital images in a photo-organization program, such as Picasa or iPhoto, that will allow you to organize, label and edit your images. Both Picasa and iPhoto are nondestructive programs, meaning they don’t compress the files and lose data each time an item is saved. Name each file to help you find it later. The Association of Personal Photo Organizers recommends a year-month-day-event format to make searching easier. You can also add the names of people, where the photo was taken or other keywords by using the “info” feature in iPhoto or adding captions and tags in Picasa.

Back up. To protect your collection for posterity, redundancy is key. You can keep files on your computer for easy access, but to prevent losing them to natural and technological disasters, back them up both offline and in the cloud. You can back up files on an external hard drive (disconnect it from your computer after each backup) or burn the files to archival-quality, “gold” CDs or DVDs. These discs resist oxidation, corrosion and scratches and last longer than traditional discs. A cloud service such as Dropbox ($10 a month for 1 terabyte of storage) adds another layer of safety.
Store. You may want to keep the original photos, or at least some of them. In addition to the emotional reasons for not tossing the originals, some people keep them indefinitely in case new technology improves scanning abilities, says Curtis Bisel, founder of Scanyourentirelife.com. Keep the originals in acid- and lignin-free boxes or envelopes. You can find protective storage options at Gaylord Archival, Hollinger and University Products.

Read more at http://www.kiplinger.com/article/spending/T057-C011-S002-how-to-protect-your-digital-content.html#3HTpqDvihwEWQYVB.99

How to Digitize Your Photos, Movies and Music

Your cherished photos, home movies and music aren’t just taking up space, they are deteriorating. You can convert them yourself or hire a pro.

By Kaitlin Pitsker, From Kiplinger’s Personal Finance, June 2015

If you’re like many Americans, you have countless boxes taking up space in closets, the basement or a storage unit that are filled with irreplaceable photos and videos. Even if you’ve never been much of a shutterbug, you’ve likely collected thousands of snapshots, slides and negatives. Click-happy photographers and self-appointed family historians could easily have accumulated more than 10,000 nondigital images.

The biggest problem with analog technology is that the images (and video and sound) deteriorate over time, dooming those Kodak moments as surely as the fortunes of the once-dominant film company. As photographs age, dyes in the ink fade and discolor, and the paper often yellows or becomes brittle. Tape used for video recordings decays as the magnetic particles lose their charge and the protective layer of film absorbs moisture. Even if it has been years since you last thumbed through your photos or loaded your videos for a nostalgic viewing, they have been degraded by air, light, temperature changes and humidity.

Curtis Bisel, 42, digitized his own photos and later tackled his parents’ collection—including slides from a trip to the 1964 New York World’s Fair. “I’d never seen my family’s whole life play out in order, and there were so many parts of the story that I couldn’t recall,” says Bisel, who has digitized almost 6,600 photos and advises others about digitizing their pictures at www.scanyourentirelife.com.
Digitizing your collection is a huge project, but don’t be discouraged. You have several options to help bring your old-school images into the modern era.

Prints and slides

When choosing a photo-digitizing service, pay attention to the resolution the scanning process will deliver. To capture the details of an image and be able to crop or enlarge it without sacrificing quality, you’ll generally want digital images that are 600 dots per inch for prints and at least 3,000 dpi for slides and negatives.

Images that are saved in JPEG format will be good enough to share on Facebook or to remember Aunt Agnes’s face. But if you plan to heavily edit the photos or use them to print professional-quality photo books, you’ll want the images in uncompressed TIFF files to maintain their integrity. Scanning services may charge extra for these files, which include all of the image data captured during scanning. Note, though, that TIFF files take up more space on your hard drive or in the cloud. (For more information on storing and organizing your files, see How to Protect Your Digital Content.)

Before you decide on a method, weed out duplicates and fuzzy shots. You may also want to cull, say, scenic landscape pictures from the same trip or other photos that don’t help tell a story, says Cathi Nelson, founder of the Association of Personal Photo Organizers. As you’re sifting through your stack, organize loose photos in broad categories, such as “The Eighties,” “Travel” or “Holidays,” to give you a better sense of the themes in your collection.

Mail-away services. If you have a lot of images you want to convert, a digitizing service such as FotoBridge or ScanCafe can do the job for a reasonable price. You mail a box of your photos to the company’s scanning center, where it will scan the images and make small fixes, such as removing red-eye or correcting the color on images that have faded or shifted. (Many of these services also convert videos.) The company will return the originals and digital files, usually on DVD or CD, several weeks later, typically with door-to-door tracking along the way.
To convert prints to 600-dpi files in JPEG format, expect to pay 20 cents to 35 cents each. To convert slides or negatives to 3,000-dpi files saved as JPEGs, you’ll pay 20 cents to 50 cents each. At ScanCafe, you’ll pay an extra 24 cents for each image you want to have as an uncompressed TIFF file. For an additional charge, many of these services also offer options to create galleries you can view online, store images in the cloud, and scan both sides of an image to capture notes written on the back.

Local options. If you’re leery of mailing your photos, you may be able to have the work done at a photo or camera shop in your community. Check on the quality of the scans the store will create, and ask to see samples. It’s pretty easy to set up shop as a digital-conversion service, so check with the Better Business Bureau to see whether any complaints have been lodged against the company.

Or locate a certified personal photo organizer in your area through the Association of Personal Photo Organizers. Many personal photo organizers work from home. They will draft a plan and offer a price quote for your project. Prices vary around the U.S., but digitizing and organizing about 5,000 photos typically costs between $750 and $1,000, says Nelson.

For your most cherished prints or ones that are torn, stained or faded, you may want to use a professional photo conservator. You’ll pay $125 to $250 an hour for skilled repair and restoration. To find a photo conservator, visit www.conservation-us.org.

Do-it-yourself. If you’re reasonably tech-savvy, you can scan your prints, slides and negatives yourself. A flatbed home photo scanner, such as the Epson Perfection V600 (about $230), can capture more image detail than an office scanner. If you have slides and negatives, you’ll need a scanner that includes a transparency unit (a second light source in the lid) and adapters for slides and negatives. Or you can rent a professional-quality scanning system from E-Z Photo Scan for three days for $295.

Most photo scanners include home computer software for basic retouching, such as cropping, adjusting color brightness and removing red-eye. As you scan, or after you get your files back from the scanning service, name the files and include identifying information about each image so it will be easier to find, then back up the digital versions.

Home movies

Digitizing your home videos is trickier than converting prints and slides because you’re capturing both sound and images. Older tapes or films may be fragile, and you may have a tough time finding working machines to play them. As with your prints, start by reviewing your collection to see what tapes or reels you want to convert and what format they’re in. Your collection could include anything from VHS and BetaMax tapes to 8 mm, Super 8, and 16 mm film.

Compared with the high-definition video of today, 30-year-old tapes, even when preserved well, may seem grainy or poorly focused. For sharp images and clean audio, the digitizing service should use high-definition scanning or 2K data scanning, and it should process the image frame by frame (rather than interlacing the images). For the highest-quality videos, ask about raw or uncompressed video files.

Mail-away services. The same services that digitize photos and slides often handle home movies, too. Most charge a flat rate of $20 to $30 to clean, digitize and do some basic editing on a standard two-hour VHS tape, or about 30 cents per foot for 8 mm and 16 mm film. Generally, they include color correction, cutting of blank scenes and image stabilization.

For home movies, which contain more detail and are recorded in a higher quality than VHS tapes, consider a specialist. Film services such as Color Lab and Pro8mm cost more but have more experience working with older, fragile film. At Pro8mm, frame-by-frame, high-definition scanning of silent 8 mm and 16 mm film costs 50 cents to $1.75 per foot.

Many organizers who belong to the Association of Personal Photo Organizers convert home movies; they generally charge between $18 and $25 per VHS tape. A local camera shop or videographer may also offer digitization services.

Do-it-yourself. The older the video, the trickier it will be to convert the footage yourself. But if your collection dates back only as far as the VHS tapes of the 1980s and 1990s, and you have a working tape player, digitizing the movies at home is fairly easy.

To convert old videocassette tapes, you’ll need a working VCR that has been cleaned recently and has audio-video output ports. You’ll also need an adapter, such as the Diamond VC500 One Touch Video Capture (about $33 on Amazon), to connect the VCR, camcorder or other device to your computer, which should have plenty of hard-disk space. Adapters such as the Diamond VC500 come with a basic editing program that allows you to cut, create chapters within the video, and save the file you’ve created.

Your home movies will take as long to convert as they do to watch, so you may want to pop some popcorn, sit back and enjoy the show.

Vinyl is cool, but digital rocks

Urban Outfitters, the retailer that has long been known for its cred among the younger generation, is a major seller of vinyl records. That means teens and millennials have discovered the warmer sound and fuller dynamic range of records. But for some people, it’s a chore to remove an LP from its sleeve, wipe off the dust and, 20 minutes later, flip it to hear side B. If you have albums that date to the ’60s and ’70s that you’d rather listen to through earbuds connected to your smartphone, you can convert them to digital without a lot of hassle.

If you have a working turntable with audio output jacks, you can use the same adapter and software to convert analog music into digital files that you use to convert videos (see the accompanying article). For better sound quality, use a dedicated turntable with a digital output feature, such as the Audio-Technica AT-LP120-USB ($249 at B&H Photo Video). This type of turntable connects directly to your computer and includes software to capture the music. Too much work? You’ll probably find most of the songs on iTunes for $1.29 or less each.

Read more at http://www.kiplinger.com/article/real-estate/T057-C000-S002-how-to-digitize-your-photos-movies-and-music.html#tH1QecBlbs4w01K2.99

The Mysteries of Cloud Storage Explained

We demystify the cloud, your virtual hard drive in the sky.

By Jeff Bertolucci, From Kiplinger’s Personal Finance, August 2015
Using an internet-based service to save, sync or back up files is convenient. The Big Four—Apple iCloud Drive, Dropbox, Google Drive and Microsoft OneDrive—are all free, if you don’t warehouse a lot of data. The very best thing about cloud storage? When your computer implodes (as mine did recently), your personal files are secure. Life in the cloud can seem a bit hazy to newcomers, so we’ve compiled answers to some common questions.

How do I install the cloud on my Mac or PC? The first step is to download the cloud provider’s app, which integrates the service with your computer’s filing system. If you’re a Windows user loading Dropbox, for example, a folder will automatically appear in File Manager. You can then move or copy files from your hard drive to your cloud account by dragging them from the PC folder to the cloud folder.

Can I save files directly to my cloud account? Yes. Say you’re writing a letter in Microsoft Word. By saving the file to the cloud folder, you’ll have a copy of the letter on your PC and in the cloud. This is particularly handy if you work on multiple devices. Back up your files to another source, too, be it a removable drive, USB stick or memory card. Why? Because redundancy is the best way to protect yourself from the Four Horsemen of the Datapocalypse: fire, theft, hardware crashes and malware.

I’m a little unclear about what “syncing” means. When you sync a file, a copy goes to your cloud account and you can access it from other devices. Apple iCloud and Microsoft OneDrive transfer files well within their own ecosystems, and the iCloud for Windows app lets you back up PC files. But Dropbox is the only cloud storage that works across all platforms. To retrieve a file, browse the cloud folder or open it from inside a program.

I use more than one service to avoid paying for storage. Can I manage them all from one screen? There’s an app for that. Otixo is a file manager that lets you search for files across your cloud folders, and copy or move files between folders without first downloading them to your computer. You can also make cloud files available to other Otixo users. The free version allows for five file transfers at a time between clouds, and one workspace for collaborating with other users.

Is there a file-size limit for cloud storage? Yes, and it varies by service. You can upload files that are up to 15 gigabytes to iCloud Drive. With Dropbox, there is no size limit if you upload files via the service’s desktop or mobile app, but a 10GB limit via its Web site. OneDrive has a 10GB limit, too. Google Drive is a bit more complicated. Uploaded documents that convert to the Google Docs format can’t be larger than 50 megabytes, but files you upload without converting to a Google format can be up to 5 terabytes each! (A terabyte is roughly equal to 1,000GB.)

Which service is the cheapest? Google Drive and OneDrive offer 15GB at no charge; iCloud users get 5GB free. Users of Dropbox’s free Basic service start off with 2GB, but may add an additional 500MB of storage for each new Basic customer they refer—or 1GB for each new paid, Dropbox Pro subscriber—up to 18GB total. For mega users, OneDrive is the price leader at $7 per month for a terabyte of storage. Dropbox and Google Drive charge $10 per month, and iCloud is $20 per month, for 1TB.

Read more at http://www.kiplinger.com/article/business/T057-C000-S002-secure-computer-files-with-cloud-storage.html#DqAPOrBZwVRkIgkl.99

Retirees, Turn Your Passion Into a Business

More seniors are venturing into the start-up world. Learn how you can launch your own business in retirement.

By Eleanor Laise, From Kiplinger’s Retirement Report, July 2015
For a growing number of seniors, retirement means business—start-up business, to be precise. Starting a business in retirement can be a way to pursue a passion, enjoy an intellectual challenge or simply boost your income. Perhaps you’ve done some consulting as a side gig and want to expand the business. Or maybe you have been downsized and are having trouble finding a new job.

If you are on the brink of retirement and thinking of launching a business, “your age can be a very positive factor,” says Ellen Thrasher, who recently retired as director of the U.S. Small Business Administration’s Office of Entrepreneurship Education. With a wealth of work experience and good-sized nest eggs, many seniors are well positioned to succeed as entrepreneurs.

People age 55 to 64 accounted for 26% of all new entrepreneurs last year, up from 23% in 2013 and 15% in 1996, according to the Ewing Marion Kauffman Foundation. More and more people want or need to continue working into their later years and they’re saying, “I don’t mind working longer, but I want to do it on my terms,” says Michele Markey, vice-president of Kauffman FastTrac, which provides training programs for entrepreneurs.

But older entrepreneurs also face unique challenges. Because they don’t have decades to recover from a small business going bust, older entrepreneurs must be particularly vigilant about minimizing risks. They should keep a tight rein on start-up costs, avoid heavy debt loads, research the target market and choose a business structure that will protect their retirement savings from a business meltdown. Before diving in, seniors may want to test whether they’re really cut out for the entrepreneurial life—perhaps by volunteering at a business incubator where they can help mentor younger entrepreneurs.

Some seniors stumble into the start-up world by accident—but then become hooked. Elizabeth Isele, 72, was 56 when she launched her first enterprise. She had retired from the publishing industry in New York City and moved to Maine, planning to do some editing and teaching. But when a publisher asked her to help create Web sites, Isele started researching what the Internet was all about—and realized how much seniors could benefit from it. So she launched an organization to provide computer training to seniors. “I was an accidental senior entrepreneur,” she says.

Once bitten by the entrepreneurial bug, Isele became committed to sharing her know-how with other seniors. She has since launched two new ventures focused on helping seniors launch their own businesses: eProvStudio and Senior Entrepreneurship Works. With training, seniors can “understand they’ve been thinking entrepreneurially their entire lives,” even if they’ve never started a business, Isele says.
Get educated

Your first step in exploring entrepreneurial life: Seek out training and mentoring that will help you determine whether you’re cut out to be an entrepreneur, give you feedback on your business ideas and cover some details of launching a business.

The Small Business Administration offers free online courses designed specifically for encore entrepreneurs. AARP offers online tools that help seniors assess whether entrepreneurship is a good fit for their personality and financesstartabusiness. Also check your local community college for courses on writing business plans and other small-business topics.

You can also find more in-depth training designed specifically for encore entrepreneurs. Kauffman FastTrac, for example, offers a 30-hour program for boomer entrepreneurs. The course is available through community colleges and other institutions nationwide.

SCORE, a nonprofit organization supported by the SBA, lets you connect with a small-business mentor by e-mail or participate in online workshops as well as providing in-person training and mentoring. You can also visit Small Business Development Centers or Women’s Business Centers, both overseen by the SBA. Find centers and other resources in your area.

Next, assemble a “kitchen cabinet”—a team of advisers who can give honest feedback and poke holes in your business plan. Include colleagues or acquaintances who have expertise you lack, perhaps in finance or marketing.

Choosing a business

The best businesses for older entrepreneurs are “not capital intensive,” says James Bruyette, managing director at Sullivan, Bruyette, Speros & Blayney, a wealth management firm in McLean, Va. If you launch a consulting business out of your basement, for example, you’ll likely avoid risking savings that you can’t afford to lose.

Consider your appetite for risk. While opening a jewelry store can be a roll of the dice, you may be able to sell items on eBay or Etsy with minimal risk. A franchise can also make sense for some risk-averse entrepreneurs, Markey says, since the business has already been established and there’s marketing help and other support available. Many franchises are home-based and don’t require a storefront.

Consider how much time you want to put into the business, your energy level and your medical condition. Talk to your family about whether they’re comfortable with the amount of time and money you’ll be devoting to the business.

Talk to business owners in the industry you’re considering to be sure you’re realistic about the demands of the business. Some people consider starting a bed-and-breakfast, for example, because they want to spend more time with their family, Markey says. But “the realities of the B&B don’t give you more time with your family,” she says.

When you’ve settled on your idea, write a business plan, which should include your budget, goals, marketing concepts and other details. The SBA offers a step-by-step guide to writing your plan .

Read more at http://www.kiplinger.com/article/retirement/T049-C000-S004-retirees-turn-your-passion-into-a-business.html#sefQ2e1GTwfFe60J.99

Planning to Pass On Your Family Business

Don’t put succession planning on the back burner. Grooming a successor could take several years.

By Meghan Streit, From Kiplinger’s Retirement Report, May 2014
Larry Berman spent most of last winter in Palm Beach Gardens, Fla., perfecting his golf game and enjoying 85-degree days. Meanwhile, in snowy Newton, Mass., his 30-year-old insurance-adjusting business was growing steadily and was on track to add 50 new customers in 2014.

Berman, 68, is in the process of handing over his business to his son, Jonathan Berman, and Jeffrey Sabel, a family friend whom Berman considers a second son. Last winter, Berman alternated ten-day stays in Palm Beach Gardens with four-day stints in Newton to check up on the business. After about a year of succession planning, Berman says he feels comfortable transferring most day-to-day operations, such as handling claims and managing finances, to Jonathan, 31, and Jeffrey, 36.

That arrangement enables Berman to work fewer hours, often remotely, while still keeping a hand in high-level responsibilities such as networking and marketing. “I’m looking at the palm trees, sitting in front of a laptop and surrounded by papers,” Berman says. “I played golf on Monday with a client, which is a nice way to spend an afternoon, and it’s also good client relations.”

Most small business owners are so busy running their companies that succession planning continually gets pushed to the back burner. “Many owners haven’t thought about the fact that if something happens to them suddenly, all of the value in their business can be lost,” says Mark Rosenbaum, a financial planner at Succession Consulting Group, in Portland, Ore. “If you haven’t worked out with your senior management team who will take over if you get sick or pass away, you leave your business in jeopardy and risk losing customers.”
Identifying a successor is the first step in the planning process. Many owners of family businesses turn to an adult child, a grandchild or other relative to take over the reins. If a family member doesn’t fit the bill, an owner is likely to sell, perhaps to a key employee or to an independent third party.

When evaluating a family member, consider his or her attributes as both a manager and an entrepreneur, Rosenbaum says. Someone may be a good manager but lack the ability to focus on the big picture or think strategically—the kinds of skills needed to run a successful company.

Rosenbaum’s business partner Leo MacLeod says good leaders must “have the ability to look beyond what they need to do today. That is a skill set many companies don’t think about—can this person think beyond just doing their own job?”

Kathleen Richardson-Mauro, co-founder of Business Transition Academy, with offices in Boston and Tampa Bay, Fla., says business owners should not presume their eldest son or daughter is the best person to run the company. A successor could be a younger child or a grandchild. Richardson-Mauro, co-author of Cashing Out of Your Business (Book Publishers Network, $18), says one reason so many family businesses fail to make it to the second or third generation is because many families view the corner office as a birthright, and an unqualified successor may not be able to keep the business afloat.
If you have several children, passing on your business to one of them can spark sibling rivalry. David Karofsky, president of Transition Consulting Group, a family-business consulting group, with offices in Framingham, Mass., and Palm Beach Gardens, Fla., says it often becomes apparent to business owners which one of their adult children is best suited to take over the company. Some children may be uninterested, live far away or be committed to another career.

However, when several siblings or cousins are hoping to take the helm, Karofsky says business owners should consider the needs of the company—not family dynamics—to choose a single successor. “We have worked with businesses that have decided to have joint leadership,” Karofsky says. “It’s not our first choice, but there is no playbook for running a family business.”

Choosing one successor doesn’t mean leaving your other kids high and dry, says Karen MacKay, a succession-planning lawyer at Burke, Warren, MacKay and Serritella, in Chicago. She says if you are giving a business to one child, you might give his siblings a larger share of other assets, such as real estate, investment accounts or life insurance proceeds.

However, because a business is usually the largest asset in an estate, MacKay says some parents decide to give children who aren’t involved in the business non-voting shares of stock, while the child who runs the company retains the voting shares. This strategy ensures that all of your heirs share in the wealth your business created, but MacKay says it can cause conflict. “Oftentimes, the business owner wants to plow cash back into the business and doesn’t want to give it to a sibling who isn’t working in the business,” MacKay says. “And the sibling who isn’t in the business is saying, ‘Give me a dividend.’ ”

Grooming Your Successor

Once you choose a successor, it’s important to prepare that person to run the company. Ideally, Rosenbaum says that the process should take place over three to five years. That allows time for the successor to earn employees’ respect and to work in different areas of the business. During the transition period, the would-be successor also should develop relationships with key clients and vendors and begin representing the company publicly. “You are giving them a trial run, and it’s not impossible that you learn in a year or so that this isn’t going to work,” Rosenbaum says.

In the case of Larry Berman’s insurance-adjusting business, his son Jonathan Berman and business partner Jeffrey Sabel had both been working at the company for several years when Berman began grooming them for leadership. Berman says that the young men were eager to advance in the business, and he embraced the idea because he had previously worked for another family’s business that suffered when the founders were reluctant to cede control to the next generation.

The three men worked with a team of professional advisers to draft a succession plan. They decided that Jonathan and Jeffrey would earn equity in the company over a five-year period, at the end of which they would become co-owners. Meanwhile, Larry Berman has a five-year renewable contract that provides for his salary, expenses and a draw against commission.

Berman relinquished his post as president and chief executive officer, but he remains the chairman of the board. Jonathan and Jeffrey were named president and chief executive, respectively, in January. “It’s a matter of learning to let go of the things you don’t need to do,” Berman says.

While he is still active in the business, Berman is making sure his protégés reap the benefit of his experience. He frequently copies his successors on important e-mails. He also makes a point to share stories from his 40 years in the adjusting business, which he says Jeffrey affectionately refers to as “Larry lessons.” “They are earning the business by ‘sweat equity’ and by taking care of my salary and expenses,” Berman says. “And at the same time, they are the beneficiaries of learning from me.”
When you’re passing on a business to a family member, you and your successors will need to find a way for you to be compensated or create a stream of income for your retirement. Steven Faulkner, head of private business advisory for J.P. Morgan Private Bank’s Advice Lab, advises business owners to review all of their assets and income sources during succession planning to determine how much money they’ll need from the business to live comfortably in retirement.

Some owners decide to work on a consulting basis for their former companies and collect a salary. You can require your children to purchase the company, either with their own capital or with a bank loan. Faulkner says another option is a seller-financed buyout, in which the company, the seller or both finance a loan for your successors to purchase the business, thereby creating an income stream for you.

Estate planning is another important aspect of succession planning. Susan Link, an estate-planning lawyer at Maslon, Edelman, Borman and Brand, in Minneapolis, says gifting shares of stock in the family business is one of the most tax-efficient methods of transferring the value of a company from one generation to the next. A well-executed plan will enable you to pass on your family business—while you’re alive or after you die—and minimize the estate-tax bite.

You can transfer shares worth up to $14,000 ($28,000 for a couple) to an individual each year without having to file a federal gift-tax return. Any amount above $14,000 counts against the estate-tax threshold when you die. The threshold in 2014 is $5.34 million for an individual ($10.68 million for a couple). If you have a number of years to plan, you may be able to use these gifts, as well as certain trusts or partnerships, to transfer a large portion of your business to your successors while enabling you to retain control until you are ready to give up the reins. In the meantime, you’ll be removing taxable value from your estate.
The IRS also permits people who are gifted shares of privately held companies to discount the value of that stock if certain standards are met. That allows owners to shift additional shares while limiting their gift-tax exposure. Link says appraisals cost about $8,000.

Selling to a Third Party

For some small business owners, selling to an independent party makes more sense than choosing a successor from within the family. That was the case for Peter Fairbanks, 66, who sold his Norwell, Mass., energy engineering company to a private equity firm in 2011.

Fairbanks and his wife started their company in 1990, and it grew to a 30-person operation. Although the couple’s two sons were working for and had ownership interests in the business, the family decided that selling was their best option.

Fairbanks says he had declined previous offers to sell his company, but this firm made an offer that caught his interest. “It seemed like these folks could provide us with the value we thought the business had,” Fairbanks says. “I made sure my sons benefited at the time of sale as well.”

Getting a business ready for sale requires a different kind of preparation than when you’re passing it on to a relative. Early in the selling process, Fairbanks realized he would need professional assistance, so he hired Richardson-Mauro’s consulting firm, and it connected him with other advisers. The consultants helped Fairbanks prepare the financials in the format that the prospective buyer wanted. “We also engaged an investment banker who helped us with the negotiations and with presenting the company in the best way,” he says.

If you think you might want to sell your business to a third party, you should begin getting your financials in order two to three years ahead of time, says Mark Ferm, a certified public accountant with Tronconi Segarra & Associates, in Williamsville, N.Y. For example, you should stop writing off club memberships and vehicles as business expenses. Ferm says companies are usually valued based on a multiple of earnings, so if your business income is being reduced by personal expenses, that could lower the selling price.

Richardson-Mauro says that it’s particularly important for small businesses to have organized financial documents because the current resale market is competitive. With baby boomers hitting retirement age, she says there’s a surplus of small businesses for sale, creating a buyer’s market. And while lending restrictions have eased since the recession, she says credit is still tight when it comes to buying a company. “Buyers are more discerning and there are more businesses to choose from, so you really want your company to be dressed for success,” Richardson-Mauro says.

Whether you’re selling to a third party or passing on your business to the next generation, you need to prepare yourself for a life without a company to run. Amelia Renkert-Thomas, co-owner of Withers Consulting Group, in New Haven, Conn., and London, says she helps retiring business owners come up with a plan for how they will spend their time and for ways that they can redirect their energy. She says the kinds of people who have the ambition to build successful businesses often are unhappy when they have too much downtime or aren’t working on meaningful projects.

That is why Renkert-Thomas recommends that retired business owners get more involved in philanthropy or put their business experience to good use by volunteering for an organization such as SCORE, which connects new business owners with mentors. What you don’t want to do is name a successor, but then show up at the office every day. “I see business owners who do that for 20 years, and everybody defers to them,” she says. “That can be really dangerous for a business because the senior person isn’t running it full time, and the next generation can’t run it because no one will give them the respect and power they deserve.”

Berman says he had watched too many friends fail to thrive in retirement because work had been the sole focus of their lives. He says he wanted to be more deliberate about how he will spend his retirement years, and for him that includes leisure time with his wife and warm weather.

Read more at http://www.kiplinger.com/article/retirement/T049-C000-S004-planning-to-pass-on-your-family-business.html#JljXJMjiA8d71Wqe.99


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