Personal Finance Tips Delivered Weekly
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December 30, 2011
Easing student loan repayments
College costs are out of control. Total outstanding student loans hover around $1 trillion, second only to home mortgages. Student loan repayment takes a hefty toll on starting salaries even during good economic times. But with so many recent graduates unable to find a decent job – or any job – repayment can be a nightmare.
December 23, 2011
Boosting your retirement plan contributions
For the first time since 2009, the IRS has increased the amount people can contribute to their 401(k) and other defined contribution plans. Effective January 1, 2012, the maximum annual contribution grows by $500 to $17,000, thanks to an increase in the Department of Labor's Consumer Price Index for Urban Consumers (CPI-U), a common measure of inflation the IRS uses to determine whether or not to increase dozens of tax-related numbers from year to year.
December 16, 2011
Credit card stolen? Here's what you do
Despite high-profile media attention, the odds of having your credit or debit card number stolen by crooks remains at historically low levels. That said, it's always good to know what to do in case lightening does strike and someone fraudulently uses your card. Left unchecked, they might try to run up bills, drain your checking account or worse – steal your identity.
December 9, 2011
How to undo a Roth IRA conversion
We've all suffered buyer's remorse – say you buy something you really can't afford or the item's sudden drop in value make it seem, in retrospect, a poor investment. That's what has happened to some people who've taken advantage of IRS rules that allow them to convert a regular IRA or 401(k) into a Roth IRA, only to discover later it may not have been the right strategy.
December 2, 2011
Financial planning for later-life marriages
Couples who marry as young adults usually don't bring a lot of financial baggage to the table. But what if you're getting married in your 40s, 50s or later – after divorce, children and years of building assets have complicated your economic situation? Do you and your spouse-to-be have a game plan for how to comingle your finances?
November 25, 2011
Finding your lost money
You may not know it, but millions of Americans are owed money from long-forgotten government payments, stock sales, bank accounts and other lost accounts. When the entities holding these funds can't find the rightful recipients, they turn over the money to individual states, which hold it in escrow until claimed.
November 18, 2011
Deadline approaches for mandatory IRA withdrawals
Reaching your 70th birthday is cause for celebration. But thanks to our quirky tax code, a potentially more important milestone arrives six months later. IRS rules say that you must begin taking required minimum distributions (RMDs) from your IRAs and other tax-deferred retirement accounts beginning in the year you reach age 70 ½.
November 11, 2011
Tax deadline looms for charitable contributions
Each year, roughly one-third of American households itemize deductions on their federal income taxes. If you're among that group, there are a several important actions you need to take by year's end in order to take full advantage of available deductions.
November 4, 2011
Life Insurance 101
Life insurance has no one-size-fits-all option. Singles with no dependents often need little or no coverage. But it can be an important purchase for people whose families depend on their income to cover daily living costs, mortgage repayment, college, retirement or other major expenses.
October 28, 2011
Budget Now for Holiday Spending
It's tough sticking to your budget any time of year, but the holiday season presents special challenges with so many unexpected expenses and temptations. If you sometimes fall prey to holiday overspending, you might want to look for year-round small spending cuts in other areas of your life that, when added together, can result in big savings.
October 21, 2011
Beware of fake check scams
The other day I got one of those annoying emails from a supposed Nigerian prince promising rich rewards for helping to move money out of his country. It's hard to believe those kinds of scams are still thriving, but they are. In fact, according to a recent survey conducted by the Consumer Federation of America, fraud (including fake checks, bogus sweepstakes and work-at-home schemes) is now among the top 10 consumer complaints received by consumer protection agencies.
October 14, 2011
Energy-Efficiency Tax Credits Expire Soon
If you haven't already jumped on the home energy-efficiency bandwagon, the good news is that several federal energy tax credits originally slated to end in 2010 were extended through December 31, 2011; but the not-so-good news is that these credits are worth significantly less and are more restrictive than before. All is not lost, however, since several additional credits (outlined below) remain in effect through 2016.
October 7, 2011
Medicare Open Enrollment Comes Early
If you're enrolled in Medicare, mark these dates on your calendar: October 15, 2011 – December 7, 2011. That's Medicare's 2012 Open Enrollment period – and you should note that it occurs a month earlier this year than in the past. Aside from exceptions made for a few special circumstances, this is the only period when current enrollees can make coverage changes for the coming calendar year.
September 30, 2011
Flexible Spending Accounts Slash Your Taxes
Admit it: You probably spend more time comparison shopping online than reviewing your annual benefits enrollment materials. That's a big mistake because the money you could save by choosing the right employee benefits package probably far exceeds any savings you could get on a big-screen TV.
September 23, 2011
Start your student loan search now
If you've got a high school senior, your household is probably knee-deep in senior-year activities – and expenses. Not to elevate your stress level, but this is probably a good time for you and your kid to start investigating how you're going to finance college next fall. Seriously.
September 16, 2011
The 411 on prepaid cards
According to Gail Cunningham, spokesperson for the National Foundation for Credit Counseling, we live in a credit-dominated society. "Without a checking or savings account," she says, "it's difficult to cash payroll, Social Security and unemployment checks; you need a credit or debit card to shop online, book a flight or rent a car; and you may be forced to carry large amounts of cash to pay bills."
September 9, 2011
The power of compounding
I wish I had learned about the power of compounding a long time ago. As a kid I walked dogs in the neighborhood, earning $5 a week. If I'd started investing that weekly $5 from age nine until 65, it would have grown to $254,000, assuming an 8 percent return.
September 2, 2011
Financial planners not just for the wealthy
It's not uncommon to feel overwhelmed by the sheer number of important decisions we need to make concerning retirement accounts, investments, college savings and other complicated financial issues. That's one reason more and more people turn to professional financial advisors to help them navigate an increasingly complex economic world. And it's not just the wealthy who require these services; many middle-class families are turning to outside financial advice as well.
August 26, 2011
Improving your credit score
Many people suffered blows to their credit scores during the unstable economy of the last few years, whether because they missed payments, exceeded credit limits or, more seriously, experienced a home foreclosure or even bankruptcy. Is this a big deal? Absolutely.
August 19, 2011
Reverse Mortgages Aren't for Everyone
You can scarcely turn on the TV without seeing ads for reverse mortgages. They're touted as a great tool for cash-strapped seniors to tap their home equity to pay off bills while remaining in their homes with no monthly mortgage payments. Although that may be true for some people, these complicated and costly loans aren't right for everyone, so it pays to do your homework.
August 12, 2011
Back-to-school budgeting tips
The days when you could send your kids off to the first day of school with a lunchbox and a hug are long gone. Today's back-to-school preparations likely include filing out piles of pre-enrollment paperwork, lining up carpools and, of course, the dreaded shopping excursions for clothes and school supplies.
August 5, 2011
Protect Your Kids from Identity Thieves
You're probably weary of being reminded to take precautions against identity theft, but here's a wrinkle you may not have considered: Identity thieves have broadened their reach by harvesting children's dormant Social Security numbers (SSNs) and using them to illegally obtain jobs, credit accounts, mortgages or car loans and much worse.
July 29, 2011
Should You Put Retirement on Hold?
One indicator our economy is still hurting is that more and more people are postponing retirement. According to the Department of Labor, those over 55 and still working have increased steadily since the recession began – 28.9 million at last count – and some surveys show more than a third of employees expect to work past age 70 or never retire.
July 22, 2011
Financial costs of caring for your parents
Kudos to the millions of "sandwich-generation" Americans. These exhausted souls spend their time and money caring for and supporting not only their own children (and sometimes, grandchildren), but their parents as well. It's no wonder that so many people caught in this situation have trouble paying their bills and saving for retirement.
July 15, 2011
Dealing with debt collectors
If you've ever fallen far behind on paying your bills, you know what it's like to dread whenever the phone rings: What if it's another bill collector? Ignoring the call – like ignoring a toothache – is never a good idea. Sooner or later, you're going to have to deal with the situation.
July 8, 2011
With budgeting, slow and steady wins the race
Budgets are like diets: No single approach works for everyone; overly complicated plans rarely work for long; and sometimes it takes a few tries before you get it right.
July 1, 2011
Nervous investors have faced many challenges over the last few years searching for safe havens. That's one reason many turn to annuities to ensure a steady stream of retirement income. But with so many types of annuities offered – and complex rules, fees and restrictions – it's not uncommon for investors to buy products not ideally suited to their needs.
June 24, 2011
Why you need renters insurance
One common misconception among many people who rent their homes is that they are covered under their landlord's insurance in case of an accident, burglary, or other disaster. Let me dispel that myth: Landlords typically only insure the building and any fixtures they own, so renters are responsible for lost or damaged possessions. And, if someone has an accident in your apartment, you're liable.
June 17, 2011
Video games aren't so bad after all
Next time you're tempted to lecture your kids about wasting too much time on video games, first check out which games they're playing – it turns out they may actually be learning important life lessons.
June 10, 2011
Financial advice for graduates
If you – or one of your kids – are about to graduate from college or high school, congratulations on successfully navigating the twists and turns of the education system. You don't need me to tell you what a challenging, rewarding and expensive road it has been.
June 3, 2011
Financial advice for fathers
With Father's Day upon us, dads everywhere are gearing up for an avalanche of gifts and "I love yous" from their spouses and kids. If you really want to return their affection, think about what you can do to protect your family financially. All it takes is a little organization and learning how to correctly allocate your resources.
May 27, 2011
Seniors vulnerable to Internet scams
We're forever warning teenagers to be careful online – don't reveal personal information to strangers, avoid scams, report bullying behavior. The same advice may be appropriate for grandma and grandpa as well. Seniors are the fastest-growing segment of new Internet users, as they've discovered email, online shopping and banking, social networking, traveling planning and other online conveniences.
May 20, 2011
Use Financial Windfalls Wisely
If you're lucky enough to win a multimillion-dollar lottery, you don't need this column; you need a team of legal and financial experts to make sure you don't blow your chance for lifetime financial security. But if you receive a considerably smaller monetary windfall, whether a tax refund, divorce settlement, inheritance or work bonus, there are actions you can take to positively impact on your current financial situation.
May 13, 2011
Senior year sticker shock
Parents, if your high-school senior is about to graduate, you have my heart-felt congratulations – and my sympathy. As your checkbook can attest, this has been an expensive year and it's not over yet. You're probably still facing senior prom, graduation gifts and many other expenses.
May 6, 2011
Trim your vacation costs
To paraphrase Yogi Berra, when it comes to gas prices, this is like déjà vu all over again. Instability in Africa and the Middle East, among other factors, has driven up pump prices to levels we haven't seen since the summer of 2008.
April 29, 2011
Financial literacy teachable moments come at all ages
I learned lots of valuable information in high school, but one subject that wasn't on the curriculum was personal financial management. We didn't learn how to balance a checkbook, why budgeting is important or how credit card interest works, among other life lessons.
April 22, 2011
For Mother's Day, help mom get organized
Mother's Day is May 8. In addition to traditional gifts like candy and flowers, consider spending a few hours helping your mom organize her financial, legal and medical records so she – and you – know where she stands. Being prepared will make it much easier to take appropriate actions should an issue ever arise.
April 15, 2011
Teach your kids about interest rates
One of the most valuable financial lessons you can share with your kids before they leave the nest is to explain what interest rates are and how they work. The important financial transactions they'll conduct as adults will likely be affected in some way by interest rates, whether as a lender or a borrower.
April 8, 2011
Having a baby? Get your finances in order
I wouldn't trade the experience of raising my two kids for anything, but I must admit that when my wife and I started planning our family, we had no idea how expensive it would be. According to a Department of Agriculture report, a typical middle-income family will spend over $280,000 in inflation-adjusted dollars to raise a child born in 2009 until age 18 – and that doesn't even include prenatal care or college costs.
April 1, 2011
Smart uses for your tax refund
Each spring, millions of Americans look forward to receiving a hefty income tax refund. And it truly is "hefty" with the average federal refund in 2010 hovering around $3,000. That's a lot of money to be giving the government through what is essentially a year-long, interest-free loan.
March 25, 2011
I'm the last person to cast aspersions on anyone who procrastinates, given my own occasional lapses in that area. I'll leave it to the self-help gurus to supply behavior-modification techniques. What I will say, however, is that procrastination can be a very costly habit.
March 18, 2011
Social Security looms for Baby Boomers
Talk about a stampede: The first wave of Baby Boomers begins turning 65 in 2011, which means they'll soon be tapping Social Security retirement benefits, if they haven't already. If you're a Boomer and haven't yet investigated how this program works, this may be a good time to learn the ropes.
March 11, 2011
Read contracts carefully
How often are you asked to sign something? I don't mean autographs or birthday cards, but legally and financially binding documents - everything from endorsing a check to signing a sales receipt to buying a house. Either way, they're all contracts.
March 4, 2011
Tax Filing Deadline Looms
Nobody likes being nagged, but I'm going to risk reader displeasure by reminding everyone that there are hefty financial consequences if you owe income taxes and do not file a return on time – or at least request a filing extension.
February 25, 2011
Think twice before tapping retirement plans
Before the housing crisis, it wasn't uncommon for people to raid their home-equity piggybanks to pay off bills. Plummeting home values and tougher lending standards helped curb that practice, leading some people to engage in a far more disturbing habit: borrowing or withdrawing money from their retirement accounts to cope with financial hardship.
February 18, 2011
Insurance reality check
When it comes to insurance, many people face the Goldilocks dilemma: Am I buying too much coverage, not enough, or just the right amount? How do you determine your proper insurance levels while ensuring you don't waste money on unneeded coverage – or worse, leave your family exposed?
February 11, 2011
Transitioning From the Military
Reentering the civilian workforce after a career in the armed forces can be challenging even during the best of times. But with today's economic uncertainty and high unemployment rates, retiring and discharged military personnel may need extra help to develop a game plan and manage their personal finances during that transition.
February 4, 2011
Get ready for America Saves Week
So many expenses, so few dollars saved. That's the dilemma faced by millions of Americans – everyone from struggling college students to young families saving for a down payment to baby boomers approaching retirement.
January 28, 2011
Don't let a layoff catch you unprepared
Chances are you or someone you know have been laid off recently. Being unemployed is difficult enough, but in a cruel twist, the longer you're out of work, the harder it can be to find a job. And, when work does finally materialize, it's often a lower-paying position. This double whammy can damage your finances for years to come.
January 21, 2011
Understanding Credit Scores
If you've tried to take out a loan or open a new credit account recently, you know that the days of easy credit are long gone. Lenders, insurers and landlords are more diligently scrutinizing your credit history to see if you're a worthwhile risk.
January 14, 2011
Feeling the pinch? Try these belt-tightening tips
Between holiday shopping bills now coming due, increased winter heating bills and the upcoming income tax season, many people are feeling the pinch. Your best bet for getting back on track is probably to trim expenses.
January 7, 2011
Get the Most Out of Your Gift Cards
If someone gave you a $50 bill, you probably wouldn't just stick it in a drawer and forget it. But that's essentially what happens to billions of dollars worth of gift cards each year – people either lose or forget about them, or never use up their balances.
December 31, 2010
Retirement Contribution Limits Largely Unchanged
You'll probably hate me for bringing this up, but it's time to begin planning for your 2011 taxes – or at least, about the tax implications of your retirement account contributions.
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