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Strategies to Pay Down Student Loans

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College attendance and cost has dramatically increased over the years. It’s no surprise student debt has piled up as well. Finding a job, following your budget, saving for retirement, buying a home, and planning fun experiences is a difficult balancing act after graduating college. In this article we will cover different strategies to pay down debt and key actions you can take to get rid of student loans.

Know what type of loans you have.

Most students will have both subsidized and unsubsidized loans. The government will pay the interest on a subsidized loan while you are in school. If you have unsubsidized loans, the interest will start accruing during your school years. This can result in a much bigger debt balance than you realize when you get out of school. If you do have unsubsidized loans, it can be a good idea to try and pay the interest along the way if you can balance work and school. 

Types of Student Loans
Refinancing

Does refinancing make sense?

Student loan interest rates can be as high as 7% or 8%. If you have good credit and refinancing can save you money in interest over the life of the loan, consolidating your debt may be a good option. This could simplify your debt obligation to one payment and potentially could lower your monthly amount due. The government also has different options like pay as you earn or income-based payment options where you pay more as your income increases. That said, be careful about refinancing Federal loans into private loans as you could lose some of the favorable re-payment options you have with Federal loans. Sometimes, depending on your circumstances, these re-payment options could outweigh the lower interest rate you may get by refinancing. Be sure to confirm your options of consolidating vs. refinancing.

Make extra payments

If you have extra cash flow or receive a tax refund, bonus or raise it may make sense to make an extra payment on your student loans. If you do decide to pay more towards your student loans, make sure it goes to the balance of your loan, not next month’s payment.  We generally recommend paying off your highest interest rate debt first, so if you have credit card debt or other loans at higher interest rates try focusing on paying down those balances first. 

Know your repayment options

Certain career paths or programs could qualify you for student loan forgiveness. Do your research before you stop paying or decide to defer your loans. The government has strict qualifications for loan forgiveness, so make sure you qualify and receive loan forgiveness before you stop making payments. 

Loan Repayment
SECURE Act

Consider a 529 plan

With the SECURE Act passing at the end of 2019, there were changes made to 529 plan rules. $10,000 per lifetime can be used from a 529 to pay down student debt. However, make sure to check your state laws. Some states don’t have a state tax deduction for 529 contributions and some states won’t let you use 529 funds towards student loans. 

Always stay on top of your student debt and know your options. If you have questions or need help contact Sharkey, Howes & Javer for a free consultation with one of our CERTIFIED FINANCIAL PLANNER™ professionals. 

Retirement Checklist

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Many of us spend our entire working life preparing for retirement. Whether it’s contributing to retirement accounts, paying down mortgages and debt, acquiring pension years, or paying into Social Security.

As retirement approaches, what steps can you take for a smooth transition?

Take Inventory of your Assets

While you are in the working world, it can be difficult to keep track of all your investments, savings vehicles and bills that you have acquired over time. As you prepare for retirement, it is important to take the time and track down all bank accounts, retirement and brokerage accounts, along with all outstanding debts. Once you have taken a full inventory, create a safe place to store all username and passwords. Potentially share this location with a trusted family member or friend in case of a future emergency. Next, consider consolidating as much as possible. Reduce the number of bank accounts, create a plan for your outstanding 401(k) or 403(b) with work, and minimize debt. This will create a simpler and streamlined transition into retirement.

 

Prepare Finances

Build a Budget

Do you know how much you are spending on a monthly basis? As you leave the workforce, it is extremely important to have a handle on expenses. Will you spend more on travel during retirement? Will the mortgage be paid off? Creating a monthly budget for retirement will allow you to monitor spending and reduce the risk of spending through your savings.

Social Security

Identify Income Sources

What is your plan for Social Security? Do you have a pension? Do you have annuities? Do you plan on working part time? By determining income sources that will be available, you and your advisor will be able to create a plan for your retirement savings. Between your monthly budget and income sources, you are then able to determine how much you may need each month from your retirement assets in order to make ends meet.

Practice Retirement

This is the fun part! Retirement is a major life transition. You now have plenty of free time which was once filled with commutes, hours at work and mingling with colleagues. So, as you prepare for retirement, start practicing for it! Set lunch dates with old friends, try out different hobbies, start learning how to enjoy free time again and shaping the retirement that you have worked so hard for.

Know Your Health Insurance Plan

It is important to have a health insurance plan in place before retirement. Can you continue a health care plan through a past employer? Have you signed up for Medicare? Which supplements may be beneficial to your situation? If you are retiring before age 65, how do you plan to cover health care insurance before Medicare kicks in? These are all important questions to answer as you create your retirement plan.

Review Estate Plans

Retirement is a great time to evaluate estate plans and make sure they are in line with your current wishes. Provide copies to a trusted family member and/or your financial advisor so that others have access to them, just in case. Also, check in on your investment account and outstanding life insurance policies to make sure beneficiaries are up to date.

Real Estate Strategy

Do you plan to stay in your home long-term? Would a retirement community be more conducive to the lifestyle you would like to live? Do you need to refinance or acquire a Home Equity Line of Credit (HELOC)? Refinancing and nailing down a HELOC are easier to do while you still have an income, so this is a great time to talk about your options with your financial advisor. 

Establish Retirement Investment Allocation

The transition into retirement comes with a great deal of changes. One of these changes is moving from the accumulation phase or saving for retirement to the distribution phase or pulling from your retirement savings. This is a huge shift in mindset. During this time, your risk tolerance may not change, but you may see an increased need for cash or liquidity. That is why it is important to talk with your financial advisor and develop a transition plan for your investments.

Real Estate

Get Excited!

Take a deep breath! You are almost there! Many people work hard their whole life to make it to retirement. Congratulations!

Our team at Sharkey, Howes & Javer is here to help you every step of the way on the road to retirement and beyond. Contact Sharkey, Howes & Javer today to speak with a CERTIFIED FINANCIAL PLANNER™ about your own retirement journey.

Understanding Interest Rates (part 1) | Historical Highs and Lows

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Interest rates have a significant impact on your finances whenever you purchase an expensive item, such as a house or car. Interest rates have fluctuated a great deal over the past four decades as the ebb and flow of the economy has a direct impact on the prime interest rate.

History of the Prime Interest Rate

Individuals who have a perfect credit history qualify for what is known as the prime interest rate. Lenders calculate the prime interest rate by taking the federal funds rate and adding 3% to it. Most types of loans use the prime interest rate as their base. The prime interest rate hit an all-time high in 1980 when it was calculated at 21.5%. The all-time low was in 2008 when it was 3.25%.

History of 30-Year Mortgage Interest Rates

When most people start applying for mortgages, they opt for a 30-year mortgage. It takes a long time for them to pay for the house, but the smaller payments are more manageable, and many try to pay a little extra each month. As a general rule, the prime interest rate doesn’t have a huge impact on the amount of interest attached to this type of loan. The interest rate for mortgages is influenced by the bond market.

Historically, the interest rates on 30-year mortgages peaked in 1981 when the rate reached 18.63%. The lowest interest rates for 30-year mortgages was in 2012 when the interest rate was 3.31%.

History of 15-Year Mortgage Interest Rates

The downside to a 15-year mortgage is that the monthly payment is higher than 30-year payments, but there are still some compelling reasons to take out a 15-year mortgage. The first is that you’ll own your property free and clear in a relatively short period of time, provided you can manage the payments. The second big advantage is that the interest rates are a bit lower than the ones connected to 30-year mortgages. Historically, 15-year mortgage interest rates peaked in 1992 at 7.96%. The all-time low was in 2013 when home buyers were able to secure a 15-year interest rate at 2.56%.

Adjustable rate mortgages are the exception to the rule when it comes to mortgages. While 15 and 30-year mortgages are impacted by the bond market, adjustable rate mortgages are influenced by the prime interest rate. With this type of mortgage, lenders use the prime rate to determine the amount of interest attached to the loan. The rate fluctuates each time the Federal fund rates change. However, lenders do set a maximum cap on the interest rate attached to the adjustable rate mortgage.

Historic Interest Rates for Auto Loans

The most popular type of auto loans are 48-month and 60-month loans. The interest rate for 48-month auto loans peaked in 1981 when car buyers had to pay a 17.6% interest rate on their vehicle loan. The lowest interest rate was 4% in 2015. The highest amount of interest car buyers paid on their 60-month car loans was in 2007 when they were charged a whopping 7.82%. The lowest interest rate took place in 2014 and 2017. At the time the prime interest rate for 60-month car loans was 4%.

Why Historical Interest Rates Were Sky High in 1980

The overall economy is why the prime interest rate has fluctuated so much over the past four decades. When the economy is booming, the prime interest rate increases, however, when the economy slips towards a recession, interest rates decrease. This is because the Federal Reserve is trying to encourage people to spend money, which in turn is supposed to stimulate the economy out of a recession.

Market Insights & Commentary

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Investors couldn’t have asked for a better start to the 2019 calendar year. It was only a mere five months ago that the stock market was experiencing a nearly 20% correction from all-time highs and everything seemed doom and gloom. Fast forward to the present, and there seems to be an entirely different sentiment in the capital markets.

2018 was an unusual year in that the bond market was flat and stock markets across the globe were negative. Typically, bonds and stocks move in opposite directions of each other, which is why investors own both in a diversified portfolio. Stocks took a nosedive at the end of last year due to fear that the global economy was heading into a recession. Jerome Powell, Chairman of the Federal Reserve, came out at the end of last year and indicated that the Fed was going to be more patient in raising interest rates. Ever since these comments, risk assets such as stocks and high-yield bonds have taken off.

Economic data has continued to be positive as well, with no signs of a recession in the near future. Although GDP growth in the United States is slowing, it still remains positive. This was the goal of the Federal Reserve in raising interest rates, to prevent the economy from overheating but also to avoid a rapid slowdown that could force a recession.

There are worries that the stock market could have priced in all of its gains already for 2019. While it is unlikely that the stock market will continue its rapid trajectory through the end of the year, there really is no way to tell where the market will go from here. Trade talks between the US and China will continue to dominate headlines and have an effect on the markets. We still are in the later stages of the business cycle, so there will most likely be a bumpier ride for the stock market during the rest of the year.

If an investor is uncomfortable with fluctuations in their portfolio, it may be time to add more conservative investments, such as bonds, to act as a stabilizer. Barring any interest rate hikes, bonds should seek out a positive return for this calendar year. So far 2019 has been a very good year to be an investor in the stock market, but if 2018 has taught us anything, it’s that the stock market can deteriorate in a hurry. This uncertainty is why investors get compensated for the risk that they take, if they can stomach it.

Market Crash? Should You Sell or Hold.

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Market crashes are inevitable. They may not be predictable, but the fact is that the market will most likely crash at some point while you own stocks. The temptation to sell as soon as the market starts to trend downwards is huge. Many people will rid themselves of stocks at a loss, in the hope of avoiding a worse loss later.

Seeing any kind of a loss in the value of your investment can induce panic. This is called an “unrealized” loss and is a normal part of investing and there are many reasons not to sell during a downturn. Even when you have a large unrealized loss. The biggest one is that people who hold their stocks through a crash often experience a profit in the long term. Unless you are trying to make money quickly (and sometimes even then), selling during a downturn is a guaranteed loss.

Instead, you should keep your time horizon in mind. Many investors are saving for retirement. The reality these days is that retirement can last a few decades and chances are you will make money by holding. Financial writer Ben Carlson invented an imaginary awful investor, Bob, who made his first investment right before a huge crash in 1973, then again before the crashes in 1987, 2000, and 2007. After a lifetime of bad luck, Bob still decided to hold on to his investments without ever selling until he retired when he ended up with a 9% annualized return.

Rather than selling your stocks during a crash, many advisors would actually argue for buying more. Taking advantage of a dip can increase your wealth in the long term since you’re essentially buying stocks at a discounted price. Market crashes are often followed by upturns.

So, what should you do to make sure that you aren’t forced to sell during a downturn? Ideally, you should have enough in your emergency fund so you don’t need to rely on your investments for necessary spending. Try to target an amount that would cover at least three months of spending, with six months or a year being even better.

It’s easy to let emotions overrule reason, so staying calm, sticking to your plan, and not panicking are vital to weathering a downturn. Historically, bear markets have lasted an average of 1.4 years and afterwards, your long term investments typically recover in time. No matter how severe a crash is, don’t let panic overwhelm you and cause you to sell your investments. If you need more advice on how to weather a downturn and develop a long term investing strategy to meet your goals, contact Sharkey, Howes & Javer today.

Retiring Early and Moving Abroad

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Returning home from an international vacation can leave us feeling saddened and missing the sunny skies, white beaches, or cultural city centers. It’s easy for our minds to start wondering “what if”…? What if I were to retire abroad? Would I be able to retire earlier? Would I be able to afford the healthcare? Will my Social Security benefit be enough to cover all my monthly expenses?

As the retirement savings crisis continues to increase, the number of Americans choosing to retire abroad also increases. According to the Social Security Administration, the number of Americans collecting their benefit while living outside of the U.S. is now almost at 700,000 people. This figure has continued to grow since the Great Recession. If all of the stars align, this could be an attractive and viable option for retiring Baby Boomers.

International Living has assembled a list of the “Best Countries to Retire”, which includes Mexico, Panama, Ecuador, Costa Rica, Colombia, Malaysia, Spain, Nicaragua, Portugal, and Malta. The list dives into the pros and cons of living (rather than simply vacationing) in each country. However, in reality, Americans who are retiring abroad are more likely to live in Canada, Japan, Germany, Mexico, and the U.K. The reasons for choosing a country vary widely amongst retiree.

The Travel Department of the U.S. Government gives you an itemized bullet point list of important planning steps before you choose or move to a different country during retirement. Some of these items include visa/residency requirements, exchange rates, and emergencies. Two items that top the list are taxes and healthcare. How will your various sources of income be taxed and what are your options for healthcare?

Are you considering retiring abroad? Contact Sharkey, Howes & Javer to speak with a CERTIFIED FINANCIAL PLANNER™ to determine how this may fit in to your retirement plan and what you may need to consider before making the move.

Will Social Security be Going Away?

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As financial planners, one of the most common questions we receive is regarding the future of Social Security. A lot of this uncertainty is driven by headlines in the media. Oftentimes, the media calls to question whether Americans can rely on the Social Security program to still be viable when current workers reach retirement. Much of the doubt is derived from changing demographics in the United States.

The baby boomer generation is reaching retirement and healthcare advances are allowing us to live longer lives. Combine this with reduced birth rates resulting in less future workers, and some of the skepticism surrounding the Social Security program becomes valid. With that being said, many Americans are afraid that the Social Security program will become obsolete, which most likely will not be the case. What we do know is that over the next 75 years or so, Social Security will have to evolve in order to support future generations of retiring workers.

The Social Security program was signed into existence by Franklin D. Roosevelt in 1935 and has been through a few major changes over the last 84 years. As it currently stands, Social Security is a “pay-as-you-go” program, which means that the current working generations are paying for the current retirees. The system is subsidized by the Social Security Trust Fund, a reserve of funds to cover any deficit between income from taxes and output of benefits. While the demographics continue to change, the program will take on more costs with less workers to fund it. But there are several solutions to this issue, many of which we have seen before throughout the history of Social Security.

The first option, which you can imagine does not resonate well with the American constituents, is to reduce future benefits. According to Barron’s, if the program remains unchanged and the Social Security Trust Fund is depleted, the Social Security program will be able to continue paying retirees 75% of currently legislated benefits. Although Social Security was created to cover 40% of your income needs during retirement, many American’s rely on it as their only financial resource when they retire. Because of this, it is unlikely that politicians would make an argument to reduce Social Security if they are looking to gain approval from the largest demographic of voting constituents, retirees. A way that politicians have reduced benefits in a roundabout way in the past is by gradually pushing back “full retirement age” from 65 to 67. It would be more likely that we would see another push back beyond the age of 67, than an out-right cut in benefits.

The other option is to increase the revenues from payroll taxes that are funding Social Security. No one is a fan of increased taxes, but if it means providing a more reliable stream of income for you during retirement, it may be worth the extra tax dollars. We have seen changes in payroll taxes in the last 10 years with Congress temporarily cutting payroll taxes by 2% in 2011 and 2012, then raising them back up in 2013 by 2%. Many workers never acknowledged the later increase in payroll taxes. On top of that, payroll taxes are typically split between the employer and employee, so workers most likely won’t take full responsibility of any possible tax increases.

So will Social Security be going away? The brief answer is no. What we do know is that the program will continue to evolve with time and with the American population. That is why it is so important that we save for retirement during our working years, so that no matter what is to come, you are prepared. If you’d like to review your own retirement outlook, whether you are close to retirement or many years away, get in touch with us today for a complimentary consultation with a CERTIFIED FINANCIAL PLANNER™.

Our Financial Checklist for Newly Married Couples

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So you’ve planned night and day, hired incredible vendors, tied the knot, and danced the evening away with friends and family. Or maybe your wedding was a simple, quiet romantic elopement with just a few loved ones present. Either way, as you forge ahead into your new life together, you might be wondering what is next, especially in the realm of finances.

Many couples already live together before they get married, so they probably share finances to some extent. They are already used to setting financial goals together, making budgets, and deciding who pays for what. If you are a newlywed and haven’t done these things, this is a great place to start. But besides these tasks, there are other things to consider to make sure your finances are in order.

Now that you are married, you have to prepare for the unexpected and make sure that everyone is taken care of in the case of the unthinkable, not to mention you’ll need to think about your future together and plan for retirement. Below is our financial checklist for newly married couples, and we hope it helps you out!

Create or Update Documents

    1. Create or update your will. If you don’t have a will already, now is the time to create one. Especially now that you have a spouse, you want to make sure your assets are going where you want them to upon your death.
    2. Create or update your living trust. A living trust is a legal contract with a third party that makes sure your assets go where you want them to go upon your death. Many people choose between a will and a trust. We know thinking about you or your spouse passing away is not enjoyable, but don’t put off creating one of these critical documents just because it isn’t fun. You have the ability to make sure everyone is taken care of while you are well, so make sure you do!
    3. Update your beneficiaries. Any life insurance plan or retirement fund will have beneficiaries listed as to who will receive your assets upon your death. Make sure these are updated to include your spouse because legally, your beneficiaries supersede your will.
    4. Update any titles. If you plan on sharing property, home and vehicles titles should be updated to include your spouse as well.

Combine or Update Insurance Policies

  1. Life insurance: Not everyone thinks about life insurance before they are married, but now that you are, it is time to make sure you both have a life insurance policy to make sure your loved ones will be taken care of if one of you passes.
  2. Auto: Often there is no reason to carry two different policies once you are married when you can save by bundling. If your spouse is going to be driving your car, you also want to make sure both names are attached to the insurance so there are no issues in case of an accident.
  3. Home: You may find that your partner can get a cheaper home insurance rate by bundling with another policy like their auto insurance. Be sure to shop around and ask about discounts for bundling.
  4. Health insurance: If you want to combine health insurance, marriage is one of the few qualifying life events that allows you to change your plan. However, you generally only have 60 days to add a spouse after the wedding, so make sure you get on this right away.

Taxes

  1. Review and adjust your tax filing status. You may need to update your W-4 so you don’t owe money at tax time. This is a great time to run your numbers through the IRS withholding calculator to make sure you’re on track for the year. If both you and your spouse will be working, make sure to check the box for “Married, but withhold at higher Single rate” when you refile your W-4.
  2. Consider your tax-advantaged accounts. Depending on your combined income, you may move in or out of eligibility brackets for various tax-advantaged accounts. Make sure you take advantage of the accounts that will be the most beneficial in the future and consider whether backdoor contributions make sense for you. If one spouse won’t be working, consider opening a spousal IRA which gives you more space for tax-advantaged savings. If you plan to have children, you could also set up a 529 plan to save money for schooling.

If this list seems like a lot, don’t be overwhelmed. At Sharkey, Howes & Javer, we are here to help. Contact us to meet with a CERTIFIED FINANCIAL PLANNER™ for help setting up your finances and getting the most from your money as a newly married couple.

Does it Make Sense to Pay Off Your Mortgage?

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A home mortgage is something that the majority of Americans need to obtain in order to purchase a primary residence. A mortgage is considered “good debt” because it is tied to an asset that has the opportunity to appreciate in value over time. It is usually issued at a lower interest rate compared to consumer loans and the interest can be tax deductible.

A common question people have is whether or not they should pay down their mortgage early. The first thing to look at when trying to answer this question is the interest rate on the loan. Since the Financial Crisis in 2008, we have seen historically low interest rates. According to FreddieMac, the average 30-Year Fixed-rate mortgage has been between 3.5% and 5.5% since 2010. It is important to take into consideration the opportunity cost of paying down your mortgage. If you have a low rate (in the 3.5%-4.5% range), it may make sense to invest that money rather than using it to aggressively pay down the mortgage. Going back to 1926, the average annual return on a 60% stock and 40% bond portfolio is about 8%. If you’re a long-term investor, it would make more financial sense to invest that money in a diversified portfolio instead.

Another aspect of this decision is the emotional side. A housing payment (whether it be rent or mortgage) is often the largest expense item in a person’s budget. For some people, you cannot put a price on the feeling of owning your own home free and clear and never having to worry about a mortgage payment again.

Are you wondering if you should pursue paying off your mortgage early? Contact Sharkey, Howes & Javer today to speak with a CERTIFIED FINANCIAL PLANNER™. We’ll help you answer this question and provide you with the advice you need to help meet your financial goals.

Three Budget-Friendly Vacation Destinations for Spring

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Spring is a glorious time to travel. Tourists are fewer and prices are often cheaper. Flights have fewer delays and cancellations, and the weather is starting to warm up. We have selected three budget-friendly trips from Denver that may appeal to you whether you’re traveling alone, with a partner, or with your family.

Get Your Groove on in Memphis

United Airlines has non-stop flights from Denver to Memphis that can usually be found for under $250. The Memphis Music Hall of Fame and the Rock and Soul Museum are just two of the many Memphis museums that feature music. Live music can be found all over town, and Beale Street is the epicenter with three blocks of nightclubs, restaurants, and stores. It is best known for delta blues, jazz, rock ‘n’ roll, R&B and gospel music. The Beale Street Music Festival, held May 3rd to 5th, draws thousands of music fans from around the world for live performances.

Another claim to fame is the city’s barbecue. Barbecue tours offer tastes of a variety of barbecue styles — up to seven for $65. Or, just pop into a nearby BBQ restaurant and make your own discoveries.

The National Civil Rights Museum incorporates the motel where Martin Luther King was murdered and displays a compelling overview of Black history from slavery through the Civil Rights movement.

Lodging in Memphis ranges from the historic Peabody Hotel downtown (about $230 a night) to chain hotels that offer rooms for $100 or less. And if you’re an Elvis fan, you can stay at the Guest House at Graceland for $161 a night.

Fly to the Windy City

United Airlines offers round trip fares to Chicago for around $170. Getting from the airport to the city is just $5 on the L train that has a station in the airport. Or, you can purchase a $28 Ventra pass that is good for a week of unlimited rides on Chicago’s L trains and busses, including to and from the airport. Check into a small charming hotel, such as the historic Old Chicago Inn ($135 a night) with its Prohibition-era inspired speakeasy. The weather is usually balmy in late spring, so walking through the city parks, along the lakefront, and down the Magnificent Mile (a shopping mecca) can be delightful.

Chicago offers world-class museums such as the Art Institute, the Field Museum, and the Museum of Science and Industry. A $106 VIP CityPASS lets you skip the lines at five major museums and attractions. Chicago theaters offer performances of many varieties with a wide range of ticket prices. The Looking Glass Theater is one of the more affordable and unusual as it is situated in the Water Tower Building. Act(s) of God is playing through the start of April and Mary Shelley’s Frankenstein is playing in May. Expect to pay $35 to $45 a ticket.

You can eat your way around the world without leaving the city. Chicago’s iconic staples are deep dish pizza, Italian beef sandwiches, and the Chicago hot dog on a poppy seed bun. Other popular cuisines includes Italian, German, Irish, Asian, and Mexican. Try little restaurants in ethnic neighborhoods for meals prepared by families from the recipes they brought from home.

With so many things to do and see, a Chicago vacation can be geared towards children, families, or adults.

Fly to Iceland and Beyond

Round trip tickets from Denver to Iceland are around $552 on Icelandair. The airline allows multi-day stopovers before boarding a plane for your onward journey to Europe. A sample price from Denver to Dublin with a stopover in Iceland is about $1,110. This is about what you can expect to pay on a major airline without a stopover. While in Iceland, enjoy some of nature’s most dramatic displays in The Land of Midnight Sun. By May 21st, there is no night in Reykjavík. Glacier hiking, lava caving, and horseback riding are some favorite activities. Many choose to rent a car and drive the ring road that circles the island, or just explore part of it for extravagant views of the wild and rugged land and seascape.

Be sure to set aside four hours to enjoy the warm, mineral-rich waters of the Blue Lagoon ($57) followed by a snack at Blue Cafe, or a meal at Lava Restaurant that serves a remarkable birch and juniper cured Atlantic char. Reykjavik has lodging options for all budgets. The Icelandair Marina Hotel ($232 a night) is by the Old Harbour beside the downtown area and has stunning ocean views. Budget hotels cost less, and some have a great deal of charm.

All three vacation options are fun to visit any season, but travelers headed for Iceland should be ready for the snow and cold if they plan an early spring trip.

If you’ve been bit by the travel bug and want to make sure your next trip fits in your budget, contact us to speak with a CERTIFIED FINANCIAL PLANNER™ and we’ll help you keep your financial plan on track while you take that vacation you’ve been dreaming of.