By Tenielle Shallman

Conservation easements are an effective tool for permanent conservation of private land. The primary purpose of a conservation easement is to protect wild life, valuable natural resources, agricultural land and scenic landscapes.

A conservation easement is a voluntary, legally enforceable agreement between a landowner and a qualified land protection organization or municipality for purposes of land preservation. The agreement sets restrictions on property activities such as real estate development, and commercial and industrial uses to a mutually agreed upon level.

Conservation easements are binding to the current owner and all future owners of the property. The landowner retains all the rights to the property that are not specifically restricted by the agreement and is responsible for the continued maintenance, taxes and any other obligations related to the property.

The landowner may receive significant state and federal tax advantages for donating the conservation easement. As a result of the Pension Protection Act of 2006, donors may now deduct the value of their gift at a rate of 50% of their Adjusted Gross Income (AGI) in 2006 and 2007. Qualifying farmers who receive 50% or more of their income from agriculture may be able to deduct up to 100% of their AGI. (Adjusted Gross Income) Further, the new legislation also extends the carry-forward period of the unused charitable contributions from 5 years to 15 years. These incentives are set to expire, however, at the end of 2007 the law will revert back to previous provisions (deduct 30% of AGI and a 5 year carry forward) unless they are reauthorized by Congress prior to year end.

If you would like to find out more about conservation easements, please contact your Wealth Enhancement Group Financial Advisor.

The Highway to Prosperity

The road to prosperity starts with a good financial plan. The quick, simple way to start your plan is to put together a financial snapshot that outlines your objectives both in the near term and the distant future. Your snapshot should include:

• Immediate goals. What financial needs do you have right now? Do you need to establish an emergency fund? Do need better disability and life insurance? What other steps should you take right now to give you the security you need?
  
  
• Intermediate goals. Do you need a new car soon, a bigger home, a vacation home or improvements to your present home? Do you need to save for your children’s college?
  
  
• Long-term goals. Do you want to start you own business? Do you want to retire and move to a nicer climate? When do you want to retire? If you want to reach those long-term goals, you need to incorporate them in a comprehensive financial plan.

You may want to talk to your financial advisor to define your immediate, intermediate and long-term goals and start working to meet those goals.

Catching Up

No matter how well we plan, life has a way of throwing some curve balls our way. Loss of a job, divorce, or an unexpected expense can foil the best laid financial plans. There are several avenues you should consider if you need to catch up on your financial plan.

First step is to make saving a priority. Spend what you have left after saving rather than saving what you have left after spending. You should be able to increase your savings rate without giving up all of life’s pleasure by simply economizing. That may mean dining out less frequently, taking fewer trips, driving a less expensive car and cutting back on other consumer purchases. But it’s all for a good cause—your future prosperity.

Common Rules of Investing:

Pay yourself first
A phrase that means to automatically route your specified savings contribution from each paycheck at the time it is received.

Because the savings contributions are automatically routed from each paycheck to your investment account, this process is said to be "paying yourself first", or before you begin paying your monthly living expenses and making discretionary purchases.
 
This simple system is a very effective way of ensuring that you continue to make your chosen savings contributions month after month. It removes the temptation to skip a given month's contribution and the risk that funds will be spent before the contribution has been made.

Regular, consistent savings contributions go a long way toward building a long-term nest egg.

Rule of 72
The Rule of 72 states that in order to find the number of years required to double your money at a given interest rate, you divide the compound return into 72. The result is the approximate number of years that it will take for your investment to double.
 
 For example, if you want to know how long it will take to double your money at 12% interest, divide 12 into 72 and you get six years. Your money would double in 7.2 years at 10%.

You should use this rule with care since to get higher returns a person generally must take greater risks. The odds of actually getting the higher returns tends to get worst as the target rate of return increases.

Next newsletter we will explain P/E (Price over earning per share) and how to use it when evaluating equity investments.

James Copenhaver
Investment Manager - Investment Management

When asked, most people respond that their most valuable asset is their home, their 401(k), etc. In reality, the most valuable asset most people control is their ability to earn an income.

The table below reveals your earning power assuming you work to age 65 and that your income increases 5% annually.

Life insurance and disability insurance are virtually the only financial tools available to most of us that can immediately protect our earning power for our families or our survivors. While most of us realize the importance of life insurance, many rarely think about the financial devastation that can result from a disability.

The table below indicates the chances of having at least one disability lasting three months or longer before reaching age 65 (source: Commissioner's Individual Disability Tables, CSO).

New Choice for 2nd Mortgages

A Combo 2nd Mortgage is a relatively new option for debt consolidation and convenience. This type of 2nd mortgage is similar to a traditional Home Equity Line of Credit in that you can draw on the line when you need it. The innovative difference is that you have the option of locking in a fixed rate on the outstanding balance, while still being able to draw on the line for convenience.

If you have an existing variable rate HELOC you may be able to lock in the existing balance at a lower interest rate and still have the Line of Credit available for unexpected costs. Call or email Wealth Enhancement Mortgage Services, LLC to find out if a No Cost 2nd Mortgage is right for you.

In these days of detailed and ubiquitous reporting on stock markets one of the great dangers facing individual investors is the temptation to time the market. Never forget that time, not timing, is the investor’s greatest ally.
If your biggest concern is when to invest your money, you’re worrying about the wrong thing. Investing a set amount each month is fine as a saving strategy, but as an investing strategy, it’s flawed. The best time to invest is as soon as you can. If you have created your asset allocation strategy, invest now!

How to play Sudoku – Sudoku begins with some of the grid cells already filled with numbers. The object of Sudoku is to fill the other empty cells with numbers between 1 and 9 (1 number only in each cell) according the following guidelines.

1. Number can appear only once on each row.
2. Number can appear only once on each column.
3. Number can appear only once on each region.
4. A summary of these guidelines would be, that a number should appear only once on each row, column and a region.

Here is the puzzle. Good luck!

Complete the puzzle and enter it in our drawing for a $25 Gift Card to T.G.I. Friday's by mailing it to:

Wealth Enhancement Group
c/o Matt Krekelberg
1905 East Wayzata Boulevard
Wayzata, MN 55391

There were 29 qualified Sudoko puzzles
submitted last month.

Wealth Enhancement Group has helped thousands of Minnesotans plan for a comfortable retirement. With a team of experts well-versed in financial planning, investment management, and maximizing tax strategies, Wealth Enhancement Group will help you pursue the life you imagined.

CLICK HERE to get your free copy of our 24-page retirement booklet, “Planning for Retirement – Strategies for Your Life, Your Finances, and Your Future”. In this booklet, you’ll learn more about strategies and options for your future.