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By lowering your withholding from your checks, you will increase the amount of money that goes into your pocket. This is money that can be used to help increase your investments or used as cash to buy something that you might otherwise put on a charge card and pay interest on later. Plus, when was the last time you received your refund from the government plus interest on that amount? Prob- ably never. When you withhold too much from your paycheck you are essentially giving the government an interest-free loan for the year. Think about what you can be doing with that money, and then think about what the government is probably doing with your money. I’m sure you have better plans for it.

Compromising Wealth for Taxes When trying to build wealth, most people focus on saving money in taxes as their number-one priority, but is that really the way to go? It’s important to do proper research before deciding that an investment that will save you in taxes is more important than a taxable invest- ment that may perform better. Saving money in taxes is important, but it’s not your ultimate goal. Make sure that you are making deci- sions that are in the best interests of your long-term goals, not just so you can save on taxes. Realistically, strategies that are employed solely to save on taxes shouldn’t work for investment purposes because that wasn’t why they were undertaken in the first place. When deciding which road is the best to take for your investments, consider why you are choosing to do anything. Is it because you want to save on taxes? Or is it the best decision based upon your risk tol- erance and financial objectives?

Real Estate Trade-Ups Did you know that you don’t have to pay taxes on the gain of your home if you purchase another, more expensive house? Section 1031 of the Internal Revenue Code says that you can delay paying tax on the gain of the sale of your home as long as you roll that money into the purchase of a new, more expensive house. The only stipulation to this is that you have to live in the house, or keep it as your primary resi- dence, for at least two years. The allowable appreciation for a taxpayer filing as single is $250,000. For those who are married, the allowable

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