Financial Planners in New York

Putting the New York budget in order

According to the U.S. Census Bureau, 2020 to 2024 American Community Survey, median gross rent in New York is about $1,621 a month, and owners with a mortgage pay a median of about $2,555 a month. Only about 54.3 percent of homes are owner occupied, one of the lowest shares in the country, and the median household earns about $85,974. The median home is valued near $423,800, with much higher prices in New York City and its suburbs and much lower ones upstate.

A planner works through the budget in the order that matters most. Housing first, then taxes, then transportation, then debt, then the goals you want money for. Because those costs vary so much across the state, the plan for a family in Buffalo looks nothing like the plan for a couple in Brooklyn.

The plan, step by step

The first step is gathering paper: recent pay stubs, your latest tax return, statements for each account, what you owe and at what rate, your insurance policies and your employer’s benefits summary. The planner then builds the plan in a set order.

Spending comes first, since a plan cannot rest on guesses. Our budgeting and saving guide gives a simple method. Next is a cash reserve sized to your job and your deductibles. Then debt, ranked by rate, using the methods in our debt management guide. After that come employer benefits, retirement saving, insurance, savings goals and basic estate papers. You leave with a document that has dated actions, such as raising a 401(k) contribution in January and reviewing insurance in March.

Benefits and programs New Yorkers should use

New York has several programs that lower costs or add protection, and a planner checks that you are using them.

• Commuter benefits. Employers in New York City with 20 or more full-time workers must offer a pre-tax transit benefit, which reduces taxable pay and lowers the cost of a monthly pass.
• Paid family leave and disability. Most private employees are covered by state disability and paid family leave, which replace part of pay for a period when you cannot work or need to care for a family member or bond with a child. The benefit is limited, so a planner checks whether a private disability policy is needed too.
• Paid sick leave. State and city laws give workers paid time to use when they or a family member is ill, which affects how large an emergency fund you need.
• College savings. New York’s 529 plan allows residents a state income tax deduction within annual limits. Our college savings guide compares account types.
• First-time buyer help. State agencies, including the State of New York Mortgage Agency, offer programs for some buyers with down payment help, and terms and income limits change often, so ask a lender for current details.

Rent or buy, and what buying really costs

In New York the rent or buy decision depends on how long you will stay and which kind of home you want. Buying a co-op or condo adds monthly maintenance or common charges, property taxes, possible assessments and a board approval process for co-ops. Closing costs are large, since New York charges a mortgage recording tax and a transfer tax, and buyers of high-priced homes in the city pay an additional tax. A cooperative may also levy a flip tax when you sell. A planner compares the full cost of owning with renting over the years you expect to stay, with the down payment invested instead.

For renters, rent stabilization rules in New York City protect some tenants, and a planner can build in expected increases. Anyone in a rent-regulated apartment should keep that benefit in mind when deciding whether to move.

Taxes a New York plan keeps in view

New York taxes income on a graduated scale, and the top rates are among the highest in the country. New York City residents pay a city tax as well. That raises the value of every pre-tax dollar you save, so the planner looks at the employer match, traditional retirement contributions, flexible spending accounts and commuter benefits first. Social Security is exempt from state tax and government pensions are exempt, while other retirement withdrawals are taxed with a limited exclusion. Our tax planning guide explains how brackets and credits work.

Freelancers, artists and gig workers

New York has a huge population of freelancers, performers, writers, designers, consultants and drivers, and their income does not arrive on a schedule. A planner builds the budget on the lowest realistic month and routes the rest to taxes, a cash reserve and goals. Self-employed workers owe federal and state estimated tax each quarter, pay both halves of Social Security and Medicare tax and can use retirement accounts built for them, such as a SEP IRA or a solo 401(k). Health insurance is a big cost, and the New York state marketplace offers plans with subsidies that depend on income, so managing taxable income can lower premiums. Keep clean records of income and expenses, since a lender will ask for two years of tax returns before approving a mortgage.

Raising children and helping parents

Childcare in New York can cost as much as rent, and many households also help aging parents. A planner lists the goals in order and assigns each a monthly amount. A dependent care flexible spending account lowers taxes on childcare costs, and tax credits for child and dependent care may apply. For parents, the plan covers what Medicare does and does not pay, whether a parent might qualify for Medicaid long-term care and what documents each parent should have. New York’s rules for Medicaid planning are complex, with a look-back period for gifts, so an elder law attorney should be involved early. Our estate planning guide describes the basic papers, such as a will, health care proxy and power of attorney.

Protecting income and property

Protecting income and property

Savings are only safe if one bad event cannot wipe them out. Life insurance protects the people who depend on your income, and disability insurance protects the paycheck itself. A renters policy costs little, covers belongings and liability and is often required by a co-op board. Homeowners policies should address storm and flood risk, since flooding from coastal storms and heavy rain has hit parts of the state, and flood damage is excluded from standard policies. A planner reviews deductibles and counts them toward your reserve.

Planner or advisor: what to check

The word advisor stretches over planners, money managers, insurance agents and brokers, so a title tells you little. A planner’s specialty is the full plan, and plenty also manage portfolios. A CFP has finished required courses, passed a board exam, gained work experience and pledged to put clients first on financial advice, which the CFP Board’s site can confirm. The SEC adviser database and FINRA BrokerCheck list registrations and discipline, and smaller firms are registered with the New York Attorney General’s Investor Protection Bureau.

How planners charge

A fee-only planner takes no commissions, and a fee-based planner might. Get the fee and what it covers in writing.

Picking a planner

1. Be clear on the job: a single plan, periodic check-ins or planning plus investing.
2. Get the yearly cost as a dollar amount.
3. Verify credentials and registrations yourself.
4. Learn whether the planner serves renters saving for a down payment, freelancers or city workers.
5. Find out what the deliverable is and how often it is refreshed.
6. Speak with two or three and choose the clearest communicator.

Video meetings mean a planner anywhere in the state, from Brooklyn to Buffalo, is available to you.

Frequently asked questions