By: Erik Thompson; Financial Advisor

As you’re no doubt aware, the long and deep recession has resulted in the highest unemployment rate in decades. But if you’ve been laid off, or if you fear a layoff may soon be coming, you’re less interested in statistics than in your immediate financial future. How will you get by until you land a new job?

This is a scary question, of course. And it can cause you to look at all your available financial resources — including your 401(k), which may well be the largest single financial resource you have.    

But before you cash out your 401(k), make sure you understand what’s involved. Your former employer is required to withhold 20% of your account balance to prepay federal taxes. Also, all your 401(k) proceeds will be taxed as ordinary income. And if you’re under age 59½ when you liquidate your 401(k), you may also be subject to a 10 percent penalty. And worst of all, the money may not be available to you when you retire.

Obviously, if you have no other financial resources, you may have no choice but to tap into your 401(k) plan. However, if you can find an alternative way to tide yourself over until you’re working again, you may be better off in the long run by not cashing in your plan.

If you decide against the “cash-out” option, what can you do with your 401(k)? Here are two possibilities:
• Keep the money in your former employer’s plan. If your former employer permits it, you may able to leave your money in your 401(k). You won’t have to pay any immediate taxes, and your money can continue to grow tax deferred. But you may no longer be able to add funds to your account.

By: Joey Lancaster; Financial Planner

Probably the greatest mistake you can make with regard to financial planning is to ignore it completely or procrastinate for so long that you think that the opportunity to do some financial planning has passed you by. While it is true that the younger you start planning the more beneficial the process will be, financial planning is worthwhile at any age.

Most people put off thinking about financial planning because of misperceptions about what the process involves or whom it can benefit. As part of its public education efforts, the Certified Financial Planner Board of Standards (CFP Board) surveyed CFP® professionals about mistakes people make when approaching financial planning. The survey showed the public’s most frequent mistakes included:

• Failing to set measurable financial goals.
• Making a financial decision without understanding its effect on other financial issues.
• Confusing financial planning with investing.
• Neglecting to re-evaluate a financial plan periodically.
• Thinking that financial planning is only for the wealthy.
• Thinking that financial planning is only beneficial as you get older.
• Thinking that financial planning is the same as retirement planning.
• Waiting until a money crisis occurs to begin financial planning.
• Expecting unrealistic returns on investments.
• Thinking that using a financial planner means losing control.
• Believing that financial planning is primarily tax planning.

How to Make Financial Planning Work For You

By Colby Dunn • Staff Writer
Photo illustrations by staff

27.9  million -
that is
how many gallons of gas- at the current $2.47 a gallon - it would take to generate enough sales tax to pay for the elementary school gym and sidewalks created by ELOST III. It would take 5,259,700 bottles of Pantene Pro-V shampoo to foot the bill for just the architect's fees that ELOST III funded. A little over 701,000 overnight stays at Madison's Wingate Inn would raise enough sales tax to fund the $5.2 million gym that Morgan County High School got out of ELOST III. And all of this is less than half of what ELOST III - the1% local option sales tax for education - has paid for since it started in November 2005.

The next incarnation of the tax, which comes before voters for renewal this Tuesday, Nov. 3, will seek $29.5 million from Morgan County consumers for a number of projects, including a new elementary school for Rutledge that was on the list with the last ELOST but didn't make it to fruition.

For the school system, renewal of the tax would mean improved classroom technology, a gymnasium pavilion at Morgan County Primary School and, again, the proposal for a new elementary school. But what would it mean for consumers?
Estimating the economic impact of ELOST means looking at not only what it costs, but what costs it would create if it were voted down.

The U.S. Department of Labor estimated that in 2008, the average family of four spent $709 per month on groceries, including household items. Without ELOST, that family would save $84 per year on groceries. Buying a new Ford F-150 would cost $324.80 less. $26 a year would be shaved off a weekly dinner at a restaurant and a full set of mid-range tires would come at a $5 discount.

Paranormal Activity. It’s pert near midnight! Get your bowhonkers in the pick-up right smack this minute ‘cause we gotta head out to the Big House! Momma thinks a ding dang ghost is a hauntin’ the house so she hired a bumblin’ bunch of ghost catchers to chase it off with one of them fancy dance séance proceedins’! We made it! Ok! Through the front door! Y’all first! Lord – Have – Mercy –  On – Moses! Momma! You can’t be drinkin’ White Lightenin’ during a saucy séance! The whole ghost team is right tipsy turvy! This calls for Coffee and bona fied Holy Water! That’s right y’all! Just take a seat  ‘round this here dinin’ room table . . . I mean séance table . . . Sprinkle that Holy Water and let’s see what happens when! BANG! Who did it? Shhhhhhh! WHOAOOO . . . OHHHH  . . . . WHOAAAA! Who said it? Stop yer moanin’ Momma! What the? Momma’s done been taken over by some bangin’ banshee! Stand back while I slap her to Monday and slap her again for missin’ church on Sunday!  SLAP-SLAP! SLAP  BACK! What the? Momma! You’re back! I reckon we’ve done scared the daylights outta that ghost! Let’s eat! I’m as hungry as a ghost hunter howlin’ on Halloween!  Am I right? Yes!

Balloon Buzz. Momma! What in the Sam Hill are you doin’ sittin’ way up there drivin’ PawPaw’s John Deere? Oh. My. Ever. Livin’. Gosh! That tractor ain’t plowin’! Momma’s haulin’ a gigantic silver shiny helium balloon out the barn door! Trouble Alert! Trouble Alert! She must be doin’ some fancy dance weather experiment! Hey! Come on y’all! Grab those ropes holdin’ down the balloon! Momma! Get off that tractor and grab a rope! Hey! Why ain’t y’all helpin’? What the? I’m flyin’ like the wind! Clackin’ Crows! The balloon’s gainin’ altitude! HELP! Hey! Who called that CNN Chopper? I’m gonna be famous if I come outta this alive! Maybe I can even snag my very own Redneck Biz Buzz Reality TV Show! Perf! Yikes! I’m losin’ my grip on this ding dang balloon rope! The wind’s picked up a spell and I’m flyin’ in fast over the James Madison Inn where famous movie star Brooke Shields stayed week before last! Must. Hold. On. For. Pond. Landin’. Behind. Town 220! There’s the pond! Time to let loose! Bombs Away! SPLASH DOWN! 

Paint the Town Pink! That’s right y’all! It’s Breast Cancer Awareness Month and lots of businesses and our fabulous local hospital are raising awareness and money to fight this terrible disease! Rhonda Smith of The Spa at the James Madison, located at 218 West Washington St., in the Madison Markets campus in Madison, wanted me to tell y’all she wants every breast cancer survivor to call them at 706-342-7000 and set up a complimentary treatment! Also, they’re hostin’ a drop in this Thursday, Oct. 15 with complimentary mini-treatments for anyone stoppin’ by!

    And, they’ll be acceptin’ donations that will go to breast cancer awareness! Oh and AVEDA reps will be on hand for skin and makeup consultations and honey don’t you know I NEED THAT immediately! The best part is that Morgan Memorial Hospital reps will also be on hand to provide FREE bone scans! Wow! Health and beauty in one stop! The Spa at the James Madison also is also sellin’ raffle tickets the entire month for only $1 for a super fantastic spa prize and all donations will go to fund breast cancer awareness! Ding dang!

    Hey and don’t forget to head over to Town 220, located at 220 West Washington St., right next to the Spa at the James Madison, this Thursday, Oct. 15 for a super fantastic Wine Dinner Spectacular! Seating starts at 6:30 and honey you’ll get a supper fit for a QUEEN or a king! It’s a five course wine and food adventure through paradise that only Francisco can cook up!

    It’s $55 per person and part of the proceeds go towards funding breast cancer research!