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Monthly Archives: June 2016

7 Facts to Know about the Adoption Tax Credit by Joanie B. Stein, CPA

Posted on June 30, 2016 by Joanie Stein

Families that plan to adopt a child in 2016 may qualify for a $13,460 nonrefundable tax credit to recoup some of the costs they incurred, depending on the adoptive family’s income and the expenses they incur.

Following are seven facts to know about the federal adoption tax credit:

  1. The credit is subject to income limitations, which may reduce or eliminate the amount of the credit a taxpayer may claim. For 2016, the full amount of the adoption credit is available to families whose annual income is less than $201,920. A reduced credit is available to families earning between $201,920 and $241,920, and the credit phases out completely for families whose income exceeds these thresholds.
  2. As a nonrefundable credit, taxpayers whose credits are more than their tax liabilities may not receive the difference in the form of a refund. However, if the credit is more than a family’s tax, they may carry unused credits forward to reduce their taxes for up to five subsequent years.
  3. Taxpayers whose employers helped to pay for adoption expenses through a written qualified adoption assistance program may qualify to exclude those amounts from their taxable income.
  4. The credit applies to adoptions of U.S. or foreign-born children under the age of 18 or any individual who is physically or mentally unable to care for him or herself. The timing of when the credit is allowable will depend on whether the adoption is conducted domestically or internationally, when the expenses are paid and when the adoption is finalized.
  5. When adopting children with special needs, taxpayers may be able to claim the tax credit even when they did not incur any qualifying expenses. For tax purposes, a special needs child is defined as one who is a citizen or resident of the U.S. at the time of the adoption, who would probably not be adopted without assistance provided to the adopting family and for whom a state determines can or should not be returned to his or her birth parent’s home.
  6. Adoption expenses must be considered reasonable and necessary to qualify for the tax credit. Examples include adoption fees, court costs, legal fees and travel expenses.
  7. To claim the federal adoption tax credit, adoptive families must complete Form 8839, Qualified Adoption Expenses, and attach it to Form 1040 or Form 1040A with their federal tax returns.



About the Author: Joanie B. Stein, CPA, is a senior manager in Berkowitz Pollack Brant’s Tax Services practice, where she works with individuals, families and closely held businesses to develop tax-efficient estate planning and wealth preservation strategies. She can be reached at the CPA firm’s Fort Lauderdale office at 305-379-7000 or via email at


Businesses Must Prepare Now for New Lease Accounting Standards by Hector E. Aguililla, CPA

Posted on June 28, 2016 by Hector Aguililla

Businesses that lease assets ranging from office and manufacturing equipment to airplanes and portfolios of real estate will need to contend with a new standard for reporting those leases on their balance sheets in the future.

On February 26, the Financial Accounting Standards Board (FASB) released a new lease accounting standard that it expects will provide lenders, investors and other users of financial statements with a clearer, more accurate picture of a company’s financial health. For lessees, the new rules contained in ASU No. 2016-02 Leases (Topic 842) could add significant costs and complexities to their operations and liabilities to their balance sheets.  As a result, businesses should begin the process of planning now, in advance of the required implementation date of December 15, 2018, for public companies and December 15, 2019, for all other entities.


Under current accounting principles, businesses must determine whether to classify leases as capital leases or operating leases, based upon the risks and rewards of ownership transferred to them from the arrangement, and account for each one differently.  Capital leases are recognized on balance sheets as both assets and liabilities, for which businesses may claim depreciation and annually deduct interest expense of lease payments.

Conversely, with an operating lease, businesses treat lease expenses as operating expenses on income statements and exclude lease assets and liabilities entirely from their balance sheets. The only mention of such operating lease obligations are included as footnotes on a business’s financial statements.  By keeping these lease contracts off of their balance sheets, businesses essentially avoided reporting the true economics of their lease assets and their obligations to pay for those assets, thereby presenting investors and lenders with a skewed representation of their businesses’ asset and credit risk.  As a result, the FASB and the International Accounting Standards Board (IASB) began to look at changing the current model as early as 2006.

Enter the New Lease Accounting Standard

Under the new lease accounting standards, businesses will be required to begin reporting on their balance sheets the assets and liabilities related to all of their leases with terms of more than 12 months. Businesses will also be required to disclose qualitative and quantitative information about lease transactions, such as information about variable lease payments and options to renew and terminate leases. For public companies, the new standard will be effective for fiscal years beginning after December 15, 2018; all other entities will have until December 15, 2019, to adopt the new standards for calendar years or after December 15, 2020, for all interim periods. Early adoption will be permitted for all organizations.
The new standard will mark the first time many businesses will recognize operating leases on their balance sheets. As a result, the amount of lease assets and liabilities they report may be different than in prior years, which may present an equally significant difference in their financial positions. For example, businesses with large portfolios of lease agreements, such as retailers, banks, construction and shipping companies, may report increased amounts of debt owed on lease obligations.  This may essentially change the way investors and lenders view a business’s contractual obligations, its financial picture and its operating efficiency.

Preparing for the New Leasing Standard

While the new leasing standards do not go into effect for some time, it behooves businesses to begin preparing for the changes now in order to minimize the impact on their operations and financial statements in the future.

Some businesses will experience significant changes to their balance sheets and profits. In addition, because businesses will need to implement the new rules retroactively, they may need to spend time tracking down their rights and obligations relating to assets previously underrepresented on their balance sheets and put into place new systems for monitoring and tracking these arrangements in the future. This may require businesses to adopt new technology and incur additional costs, for which budget estimates should be calculated sooner, rather than later.

To help make the transition to the new standard easier, the FASB will require reporting organizations to take a modified, retrospective approach, rather than a full-retrospective transition approach. Furthermore, the FASB includes a number of practical and optional expedients reporting organizations may take to make the transition as efficient as possible.

The new leasing standards may also affect how businesses asses their decisions to lease versus buy property or needed equipment. For example, it may be more economically advantageous for one business to buy rather than lease equipment, or a business may seek to modify the terms of existing leases in order to reduce the impact on their future financial statements.

Early preparation to minimize the impact of the new standards will require businesses to commence the following activities:

  1. Take inventory of all existing lease arrangements and debt covenants
  2. Identify how the business will track and monitor all current and future lease arrangements to comply with the new standard
  3. Understand how the new standards will affect the business’s balance sheet, credit rating and access to debt
  4. Identify opportunities to save costs and minimize impact on the business’s operations and financial position, including negotiating lease terms
  5. Seek the counsel of experienced accountants and auditors, who can help to assess the impact of the new standards and develop a plan to make the transition as simple and economical as possible.

About the Author: Hector E. Aguililla, CPA, is an associate director with Berkowitz Pollack Brant’s Audit and Attest Services practice, where he provides audit and accounting services, litigation support and consulting services to business clients. He can be reached in CPA firm’s Miami office at (305) 379-7000 or via email at


IRS Again Extends Work Opportunity Tax Credit Filing Deadline by Karen A. Lake, CPA

Posted on June 23, 2016 by Karen Lake

Businesses that hired veterans and other qualifying workers since January 1, 2015, have an additional three months to claim a Work Opportunity Tax Credit (WOTC) under recently issued IRS guidance. The deadline to apply for the credit, which could be as high as $9,600 per qualifying employee, has been extended from June 29 to September 28, 2016.
To qualify for the WOTC, an employer must request from a designated local agency certification that an intended employee is a member of the “targeted group.” This includes disabled veterans, ex-felons, designated community residents living in Empowerment Zones or Rural Renewal Communities, individuals referred for vocational rehabilitation as well as recipients of Social Security, Supplemental Nutrition Assistance Program (SNAP) food stamps and Temporary Assistance for Needy Families (TANF). Applying for the credit requires employers to submit to their State Workforce Agency (SWA) by September 28, 2016, IRS Form 8850 for each qualifying employee hired between January 1, 2015, and May 31, 2016.

The tax advisors and accountants with Berkowitz Pollack Brant work with businesses of all sizes and across a broad range of industries to maximize tax-savings opportunities throughout the year.

About the Author: Karen A. Lake, CPA, is an associate director of Tax Services with Berkowitz Pollack Brant, where she helps individuals, businesses and non-profit entities navigate complex federal, state and local taxes, credits and incentives. She can be reached at the Miami CPA firm’s office at (305) 379-7000 or via email at

How to Maximize Health Savings Accounts for Retirement Spending by Adam Cohen, CPA

Posted on June 23, 2016 by Adam Cohen

Taxpayers who participate in high-deductible health plans are permitted to make tax-deductible contributions to health savings accounts (HSAs) to cover the costs of qualifying medical expenses. The current pre-tax contribution limits are $3,350 for individuals and $6,750 for family coverage, which will increase $50 for individuals and remain the same for family plans in 2017.

To be eligible to contribute to an HSA in 2016 and 2017, a taxpayer must participate in a health plan with an annual deductible of $1,300 for self-only coverage and $2,600 for family coverage. The maximum out-of-pocket medical expenses a HSA may cover will also remain unchanged in 2017, with a cap of $6,550 for self-coverage and $13,100 for family coverage.

Contributions to HSAs can be invested in a variety of mutual funds, similar to how workers save money in 401(k) and other retirement plans. As a result, workers not only have the ability to use tax-deductible HSA contributions to cover rising out-of-pocket medical expenses, they also have the opportunity to carry HSA balances forward from year to year and allow them to grow tax-free for use in retirement. As long as distributions from HSAs are used to cover qualified medical expenses, they are not subject to taxes. Therefore, retirees will have the benefit of paying down a significant portion of HSA savings before having to tap into retirement savings to pay routine expenses.

Understanding all of the health insurance options and their tax implications to individuals and businesses is a complex endeavor. The professional advisors and accountants with Berkowitz Pollack Brant have deep knowledge and experience guiding taxpayers through the process including access tax efficiency and compliance with the Affordable Care Act.

About the Author: Adam Cohen, CPA, is an associate director in the Tax Services practice of Berkowitz Pollack Brant, where he works with closely held businesses and non-profit charities, hospitals and family foundations to maintain tax efficiency and comply with federal and state regulations. He can be reached at the CPA firm’s Ft. Lauderdale office at (954) 712-7000 or via e-mail


IRS Raises Interest Rates on Tax Underpayments and Overpayments by Adam Slavin, CPA

Posted on June 20, 2016 by Adam Slavin

For the first time since the fourth quarter of 2010, the IRS has increased interest rates for overpayments and underpayments of federal taxes.


Effective for the second quarter beginning April 1, 2016, the new interest rates will be 4 percent for individual taxpayer underpayments and overpayments.  This is calculated as the federal short-term rate plus three percentage points.


A 3 percent rate will apply to corporate overpayments plus an additional 1.5 percent for overpayments exceeding $10,000.  The rate for large corporate underpayments will be 6 percent beginning on April 1. The corporate rates for overpayments are computed by adding 2 percentage points to the federal short-term rate whereas underpayments represent the short-term rate plus 3 percentage points.


According to the IRS, this interest rate increase is a result on the recent rise in the federal short-term rate, which increased from 0 percent to 1 percent as of February 1.


Taxpayers must recognize that this increase represents a correction from a prior IRS announcement that indicated rates would remain the same for the second quarter.

About the Author: Adam Slavin, CPA, is a senior manager in Berkowitz Pollack Brant’s Tax Services practices, where he provides tax planning and consulting services to high-net-worth individuals and closely held business. He can be reached in the CPA firm’s Boca Raton, Fla., office at (561) 361-2000 or via email at


The Reality of Investing: A Look into Behavioral Finance by Shane Phillips, CFA, CAIA

Posted on June 16, 2016 by Richard Berkowitz, JD, CPA

Most versions of economic and finance theory take the approach that humans are rational and will make the best decisions given their specific circumstances. Unfortunately, theory is not reality. In reality, humans often make irrational decisions. Often, these choices are influenced by psychological factors that can be explained through the study of behavioral finance.


Behavioral finance “uses insights from the field of psychology and applies them to the actions of individuals in trading and other financial applications”1. The following are six of the most popular theories in behavioral finance and explanations about their impact on investors, both amateur and professional.



Anchoring is the natural tendency for an individual to make an assumption or judgement based on a point of reference that he or she knows, even if that detail is not relevant to the decision at hand. For example, a business traveler who has stayed at a specific hotel chain numerous times may rely on that reference point when selecting a hotel for a personal vacation. In this case anchoring makes perfect sense.


In the investment world, however, anchoring may not always be prove sensible. Consider the investor who continues to buy the stock of ABC Typewriter Company below its initial purchase price of $100. The investor expects the stock price to eventually revert back to its original value, which, in this example, is the “anchor” on which the investor makes a purchase decision. The problem with this type of thinking is that it does not consider changes in the company and its industry since the initial purchase price. For example, with the invention of the personal computer, the typewriter company’s stock may not reach $100 again.


Working to remove this anchoring effect from investment strategies and instead focusing on fundamentals and current information should help individuals make better investment decisions based on facts.


Mental Accounting

Treating money differently based upon how one receives the funds is referred to as mental accounting. For example, investors may view and use money they earn from employment differently than money received through inheritance, tax refunds or gambling profits. Some individuals wait all year to receive tax refunds and think they hit the jackpot once the refund arrives. They often use this “free money” from the government to treat themselves to a pricey gift that they would not have otherwise purchased. In actuality, tax refunds are the return of an interest-free loan taxpayers gave to the government. Using this money for different purposes based upon how it was received over many years may hinder investors’ long-term investment goals.


Disposition Effect                                                                                                        

It is common for individuals to hold losing investments with the hope that those securities will recover enough for the investors to sell them at a gain at some point in the future. Conversely, individuals may sell investments at a gain to lock in those profits. This tendency to hold losers and sell winners is called the disposition effect.


The problem with holding or selling a stock based upon whether or not it has made money is that such thinking does not take into account current information. Consider the investor who in the early 2000s sold stock in Apple in order to lock in an immediate profit. In hindsight, this decision, which was made without regard for the company’s future business prospects, no longer seems like a sound financial decision. The decision to hold, sell or buy an investment should be assessed regularly based on timely facts rather than one’s past experiences of gains or losses.


Confirmation Bias and Cognitive Dissonance

Sometimes, investors are so set in their beliefs that they refuse to listen to opinions that contradict their own (cognitive dissonance) and pursue only that evidence which supports their own views (confirmation bias). Both of these behaviors can negatively affect investment decisions.


Using the example of ABC Typewriter Company”, consider the investor who has held the stock for 15 years and has yielded above average returns over that time. However, in the past few years the stock has earned poor returns as the company struggled against the competition of personal computers. The investor remains convinced that one of the company’s turnaround plans is going to work, and he or she continues to hold the stock despite advice from others that have already sold.


It is important that investors take a step back from their own biases and consider opinions contrary to their own in the decision-making process.


Familiarity Bias

Many people make decisions based upon past experiences, similar to the selection of the hotel used previously. However, when individuals invest solely in companies, investment products or markets in which they are most familiar, they may be missing out on significant opportunities.


For example, many U.S. investors invest a majority or, in some cases, all of their assets in domestic markets, even though a majority of global GDP and investable assets come from foreign markets2. By making investment decisions based solely on that with which investors are familiar, a large part of the global investment landscape is ignored, and many opportunities may be missed.


It is not uncommon for investors to fall victim to one or more behavioral biases during their lifetimes. However, by understanding and identifying these biases, investors may take steps to minimize their influences on investment decisions and outcomes.


About the Author: Shane Phillips, CFA, CAIA, is a member of the investment team with Provenance Wealth Advisors, an independent financial planning services firm affiliated with Berkowitz Pollack Brant Advisors and Accountants. For more information, call (305) 379-8888 or email



  1. NASDAQ, “
  2. JP Morgan Asset Management, “Guide to the Markets: Local investing and global opportunities,” April 30, 2016


Provenance Wealth Advisors, 515 E. Las Olas Blvd., Ft. Lauderdale, FL 33301 (305) 379-8888.

Securities offered through Raymond James Financial Services, Inc., Member FINRA/SIPC.

Raymond James is not affiliated with and does not endorse the opinions or services of Berkowitz Pollack Brant Advisors and Accountants.


This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. Any opinions are those of PWA and not necessarily those of Raymond James. You should discuss any tax or legal matters with the appropriate professional. Prior to making an investment decision, please consult with your financial advisor about your individual situation. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete.




Individuals with Foreign Assets Face June 30 FBAR Filing Deadlines by Tony Gutierrez, CPA

Posted on June 14, 2016 by Anthony Gutierrez


Federal tax laws require U.S. citizens and resident aliens to report and pay taxes on their worldwide income.  As a U.S. person, you are also required to report certain details about your financial interest in or signatory authority over foreign financial account.   A foreign financial account includes a bank account, brokerage account, mutual fund, trust, or other type of foreign financial account located outside the U.S.


U.S. citizens and resident aliens have until June 30th to file electronically the FinCen Form 114, Report of Foreign Bank and Financial Accounts (FBAR), when the aggregate value in those accounts exceed $10,000 at any time during the tax year.  Failure to file an FBAR by the June 30th deadline may result in significant fines equal to the greater of $100,000 or 50% of the balance in the unreported account as well as criminal charges for willful violations.


Taxpayers should consult with a U.S. tax advisor or certified public accountant (CPA) to determine if they are required to file an FBAR.  In addition, depending on the aggregate value of foreign assets, certain taxpayers may also be required under the Foreign Accounts Tax Compliance Act (FATCA) to complete Form 8938, Statement of Foreign Financial Assets.


About the Author: Tony Gutierrez, CPA, is an associate director with Berkowitz Pollack Brant’s International Tax Services practice, where he focuses on tax and estate planning for individuals, families and businesses with domestic and foreign interests. He can be reached in the CPA firm’s Miami office at 305-379-7000 or via email at

Understanding the Value in Business Valuations by Daniel Hughes, CPA/CFF, CGMA, CVA

Posted on June 09, 2016 by Daniel Hughes

There are many times during a business’s lifecycle when a valuation will be required to measure the entity’s realistic economic worth at the present time, historically or into the future. Examples can include situations involving litigation or a corporate dispute, a loan request, succession planning or a business purchase, sale or merger.  Additionally, because a business’s value is often so closely tied with the owner’s personal wealth, a valuation can be useful in estate and gift planning, prenuptial planning, divorce litigation and in a range of other tax-related situations.

Defining a business’s value, however, is not as easy as looking at the entity’s balance sheet and income statement. Rather, a formal appraisal of the business will consider more factors and reveal far more detail than an owner can find on financial statements.  As a result, the business valuation process can go a long way in helping owners make informed decisions about the enterprise’s ongoing operation and continued success.

The Valuation Process

The first step in the valuation process is to engage the expertise of experienced valuation analysts. These professionals understand all of the factors that go into undertaking a valuation, including thorough reviews and analyses of pertinent financial data and documents, management interviews and site visits, and assessments of current market and industry conditions. With this information in hand, they may employ financial models, as well as appropriate discounts and premiums, to arrive at an unbiased value for a company at a specific point in time given the potential economic value of the enterprise into the future.

Methods of Valuation

There are three fundamental approaches to arriving at the value of a business: an income approach, a market approach or an asset approach. The approach one employs will often be determined by the type of business being valued and where the business is in its lifecycle.  While it is not uncommon for appraisers to employ a combination of all three approaches, business owners should have a keen knowledge of what is involved with each.

The income approach to valuation aims to measure the present value of a business’s future income and cash flow in today’s dollars. It forecasts the company’s future earnings power by considering its historic and present income, cash flow, and expenses, as well as the capital it will need to maintain operations into the future.  By relying on this record of business performance as a foundation for future projections, the income approach tells individuals holding an interest in the company, what risks, returns or benefits those investors can expect in the future.

Typically, the income approach is best applied to operating businesses, where value is added to products or services from labor and intangible assets. This can include businesses in the manufacturing, retail and wholesale industries.

The market approach takes a broader look at the industry in which a business operates and compares that company’s performance to those of similar entities.  Just as home sellers will look at recent sales of comparable properties to determine a fair sales price for their homes, business appraisers applying a market approach in a business valuation can look at sales of comparable businesses or guideline public companies in the same industry.  By using this empirical evidence to determine benchmarks and apply industry multiples, business appraisers can arrive at an appropriate market value of the business.

The third method for valuing a business is the asset approach, which considers the fair market value of the underlying assets the business owns, minus the business’s liabilities.  The appraisal begins with an assessment of the company’s balance sheet. A  value is determined for each asset and liability and adjustments are made when deemed necessary. Often, this approach will require separate appraisals for equipment and real property owned by the business.

The utilization of appropriate valuation approaches should be left to the professional judgment of an experienced valuator. A qualified business appraiser is able to support his or her conclusion to correctly value a business and provide significant benefit to the client.  The Forensic and Business Valuation team at Berkowitz Pollack Brant has a broad range of experience in conducting business valuations.

About the Author: Daniel S. Hughes, CPA/CFF, CGMA, CVA, is a director in the Forensics and Business Valuation Services practice at Berkowitz Pollack Brant, where he works with businesses of all sizes on matters involving valuations, economic damages, lost profits and the quantification of business interruption insurance claims.  He can be reached in the CPA firm’s Miami office at (305) 379-7000 or via e-mail at



Businesses Face New Guidelines in Applications for Accounting Method Changes by Angie Adames, CPA

Posted on June 08, 2016 by Angie Adames

The IRS recently updated guidance regarding how certain businesses may obtain consent to change their methods of accounting through Form 3115, Application for Change in Accounting Method.  The automatic accounting method changes apply to Forms 3115 filed on or after May 5, 2016, for a year of change ending on or after Sept. 30, 2015.


Application of the new guidance extends to a very broad list of specific businesses as well as to specific items reported by an even wider net of business entities.  For example, Rev. Proc. 2016-29 applies to utility companies, restaurants and advances made by a lawyer on a client’s behalf, as well as to businesses that seek to change their methods of accounting for bad debts from a reserve or other improper method to a specific charge-off method.


Additionally, the new guidance covers automatic changes in depreciation methods, start-up expenditures, capital expenditures and a number of method changes under the uniform capitalization rules under Section 263A.


Businesses should seek the counsel of experienced accountants to understand how the recent changes in accounting periods and in methods of accounting affect their operations.

The tax advisors and accountants with Berkowitz Pollack Brant work with individuals and businesses across a broad range industries to maximize tax efficiencies and comply with frequently evolving regulations.

About the Author: Angie Adames, CPA, is a senior manager  with the Tax Services practice of Berkowitz Pollack Brant, where she provides  tax and consulting services to real estate companies, manufacturers and closely  held business. She can be reached in the CPA firm’s Miami office at (305) 379-7000 or via email at


Sending Children to Camp? You May Get a Tax Break by Nancy M. Valdes, CPA

Posted on June 06, 2016 by

As the school year comes to a close, parents are preparing to enroll their children in programs that keep their little ones’ minds and bodies active and engaged during the summer months. The range of summer programs available to families is huge – from day camps to sleepaway camps, sports camps to educational programs. Often, costs becomes a major deciding factor in which program a family will select.   While considering summer camp expenses, parents should remember that the IRS may offer tax credits and deductions that ultimately reduce the costs of enrollment in these programs.

The Child and Dependent Care Tax Credit allows certain taxpayers to claim a credit for up to $3,000 to cover expenses for the care of one child younger than 13, or up to $6,000 for two children under 13, while the parent(s) work(s) or look(s) for work. If one parent is not working, the credit will not apply.

According to the IRS, parents whose children attend day camp may qualify for the credit, whereas those who send their children to sleepaway camp may not qualify. The amount of the credit will depend on the taxpayer’s earned income and filing status. More specifically, the credit, which can be as high as 35 percent of qualifying camp expenses, decreases as income increases and is not available those taxpayers who are married filing separately.

While a tax credit reduces the amount of taxes a family will owe the government dollar for dollar, a tax deduction reduces the amount of income the family earns that is subject to taxes. For example, families may deduct from their taxable income the costs they spend on physicals and shots required for enrollment in summer camp. Similarly, families may deduct the costs a summer program charges them to transport children on field trips to and from its facilities. Expenses required to get children to and from camp are not deductible.

About the Author: Nancy M. Valdes, CPA, is a senior manager with Berkowitz Pollack Brant’s Tax Services practice, where she focuses her practice on tax strategies for business owners and high-net-worth individuals and families. She can be reached at the CPA firm’s Miami office at (305) 379-7000 or via email at

8 Ways to Save a Marriage from Financial Infidelity by Stefan Pastor

Posted on June 02, 2016 by Richard Berkowitz, JD, CPA

As wedding season approaches, it is a good time for couples to address the risks of financial infidelity.


Not all couples are financially compatible; one partner may spend or save money differently from the other. However, when a spouse intentionally hides assets or significant financial information from a partner, red flags should go up.  Such unfaithfulness can be a sign of larger marital issues and as devastating to a marriage as sexual infidelity.


According to a recent survey conducted by Harris Interactive and the National Endowment for Financial Education, 42 percent of adults admitted to committing financial infidelity and more than 75 percent reported that such deceit negatively impacted their relationships. Moreover, the results of a recent survey conducted by credit reporting agency Experian revealed that 40 percent of newlyweds did not know their spouses credit score before walking down the aisle, despite the fact that 80 percent of respondents believed that financial responsibility is an important characteristics of a spouse.


While it is perfectly normal for a marrying couple to maintain separate bank accounts, both spouses should be forthright in sharing their financial information, including assets, earnings and debt. Doing so will go a long way to preserving the couple’s shared financial goals, which may include purchasing a house or savings for a child’s education or their own retirement.


Broaching financial topics may not easy. Following are eight tips to get the conversation started and keep couples financially faithful.


  1. Share everything, including credit scores, financial obligations, business interests, estate documents and spending habits. Transparency is key to cooperation and marital harmony.
  2. Work together to establish short-term and long-term financial goals and be prepared to compromise.
  3. Establish a budget based on current earnings and expenses with an eye on shared financial goals for the future.
  4. Set a dollar amount that each spouse will need to agree to before the other makes a big purchases. The amount could be as small as $100 or as large as $5,000 of more.
  5. Share account information so that one partner may access the other’s accounts in the event of an emergency.
  6. Look at the big picture. While a couple may have different spending habits, it does not mean their marriage is doomed.
  7. Consider the benefits of a prenuptial agreement before walking down the aisle.
  8. Seek the advice of a qualified financial advisor who can begin a dialogue about financial fidelity and guide a couple to help make the right decisions that meet their particular needs and goals.

About the Author: Stefan Pastor is a financial planner with Provenance Wealth Advisors, an independent financial services firm affiliated with Berkowitz Pollack Brant Advisors and Accountants, and he is a registered representative with Raymond James Financial Services. He can be reached at (954) 712-8888 or via email


Provenance Wealth Advisors, 515 E. Las Olas Blvd., Ft. Lauderdale, FL 33301 (954) 712-8888.

Securities offered through Raymond James Financial Services, Inc., Member FINRA/SIPC.

Raymond James is not affiliated with and does not endorse the opinions or services of Berkowitz Pollack Brant Advisors and Accountants.

This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. Any opinions are those of Provenance Wealth Advisors and not necessarily those of Raymond James. You should discuss any legal matters with the appropriate professional. Prior to making an investment decision, please consult with your financial advisor about your individual situation. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete.




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