What You Should Know about Working in Retirement

Posted on May 16, 2013 by Jen D

More people 65 and older are continuing to work past retirement age, according to U.S. Census Bureau figures. Their reasons for doing so are as diverse as the senior population. Some need the money to supplement retirement savings. Others continue to work to stave off retirement boredom. Still others work in volunteer positions to give back to the community.

Many consider working after reaching their full retirement age. Before starting a new job, understand how earned income might affect your Social Security benefits.

Many consider working after reaching their full retirement age. Before starting a new job, understand how earned income might affect your Social Security benefits.

Whatever your reason for working while retired, you should be aware of how any earned income may affect your tax situation and Social Security benefits. Generally, the more wages you earn, the more taxes you owe. In some cases, the amount you earn while retired could lower the amount of Social Security you receive.

If you continue to work after you reach full retirement age (log on to www.socialsecurity.gov to determine yours), your Social Security benefits won’t be affected, according to the Social Security Administration. However, if you’re drawing benefits early and earning income, your benefits could be reduced if your earnings exceed certain limits, the SSA says. The good news is, once you reach full retirement age, your benefits won’t be affected no matter how much salary you earn.

You may be unsure if you’ll need to work during retirement. You can check your expected Social Security benefit online at www.socialsecurity.gov. The SSA last year launched an initiative to allow taxpayers to review their anticipated benefits online at any time, rather than having to wait for a paper statement to arrive in the mail.

It’s a good idea to consider whether or not you’ll work when you’re planning for retirement. If you’re already retired and thinking of going back to work, sit down with your financial planner or tax accountant and discuss how work wages will affect your overall financial life.

 

This article is provided for general guidance and information. It is not intended as, nor should it be construed to be, legal, financial or other professional advice. Please consult with your attorney or financial advisor to discuss any legal or financial issues involved with credit decisions.

Published by permission from ConsumerInfo.com, Inc.  © 2013 ConsumerInfo.com, Inc.  All rights reserved.

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Five Car Care Tasks to Save Your Car and Maybe Your Credit

Posted on May 7, 2013 by Elena Harshaw

Even new, reliable vehicles require basic care. Keeping up with maintenance tasks like oil and filter changes can help your car run longer and help you avoid hefty repair bills for preventable problems. After all, charging an expensive auto repair to any credit card might affect your credit score.

You can save even more money by doing some simple services yourself. Here are five that are well within the abilities of most do-it-yourselfers.

1. Oil changes – An oil change can cost, on average, around $20 to $30. Using synthetic oil can push the price higher. If you change your oil every 3,000 miles (the rule-of-thumb measure) and drive around 10,000 miles per year (also the average), doing your own oil changes could save you $100 or more annually. The oil is the life blood of your vehicle, and keeping it clean is one of the best things you can do to help your car stay in top working order.

2. Tire pressure – Improperly inflated tires can dramatically reduce your vehicle’s fuel efficiency. Underinflated tires create drag, and consume more gas. Overinflated tires may put you at risk of a blowout. Refer to your owner’s manual for the proper psi level for your vehicle, and regularly check tires to make sure they’re at the right level.

3. Air filter – In most models, the air filter is easily accessible and replacing it is as simple as turning a screw, lifting out the old one and putting a new one in its place. A clean air filter helps your vehicle’s engine run more efficiently.

4. Windshield wipers – Clear vision is paramount for safety. Old, worn windshield wipers don’t work well to remove precipitation from the windshield, and may obscure your vision in less-than-optimum driving conditions.

5. Spark plugs – The spark plugs help keep your engine running smoothly. Replace them based on the manufacturer’s recommendation in your owner’s manual – sooner if you notice your vehicle is difficult to start or seems to be losing power.

Performing your own maintenance can help you save money on your car and avoid running into unexpected debt. If you’re unsure how to perform these tasks, or want more detailed guidance, you can find plenty of resources through reputable companies like AAA.

This article is provided for general guidance and information. It is not intended as, nor should it be construed to be, legal, financial or other professional advice. Please consult with your attorney or financial advisor to discuss any legal or financial issues involved with credit decisions.

Published by permission from ConsumerInfo.com, Inc.  © 2013 ConsumerInfo.com, Inc.  All rights reserved.

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Tips for getting started with college financial aid

Posted on May 1, 2013 by Elena Harshaw
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Not only is not too early – it may be too late!
There are state and school-set deadlines for applying for financial aid, and it’s important to know what those are.

As the year draws to an end, many of us start thinking about next year’s finances.

Perhaps you’re already planning on how you’ll increase your emergency fund or mitigate your tax burden in 2013. But is it too soon to start thinking about financial aid for your college-bound high schooler?

Not only is it probably not too early, it may actually be too late! A lot depends on where you live and what school your child will attend.

There are state and school-set deadlines for applying for financial aid, and it’s important to know what those are. The sooner you apply, the better your chances of securing your share of the available aid before it’s all allotted for the year.

The U.S. Department of Education’s Federal Student Aid office offers an online calculator to help you understand deadlines.

Generally, you should contact the financial aid offices of schools you’re interested in early in the student’s senior year of high school. Find out their deadlines and what documents will be required. In January of the student’s senior year, you should complete and submit a Free Application for Federal Student Aid, which can be found on the Federal Student Aid office’s website. You can submit it online or through postal mail, and it’s required in order for students to be considered for all federal financial aid programs, and for most state and college aid programs as well.

College financial aid offices are great resources for students and their families. Keep the lines of communication open with them, and remember that you’ll need to reapply for aid every year your student attends college.

There are of course other options for paying for college, such as scholarships, student loans, and grants. The process for loans will include credit checks, so knowing where you stand and getting your credit report will be important. No matter what route you take, it’s best to plan ahead and know your options!

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4 Tips to Stay Frugal When it Counts

Posted on April 12, 2013 by Elena Harshaw
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A commitment to saving money is an admirable quality. But sometimes, you can run into problems by spending too little when you should spend more.

Thanks to the economy, frugal is in fashion – and likely to stay that way for the foreseeable future. But is it possible to be too frugal? Where is the line between being thrifty and just plain being cheap? And what happens when you cross it?

A commitment to saving money is an admirable quality. But sometimes, you can get yourself into a pickle by spending too little when the situation merits spending a bit more.

Here are four areas where being too frugal might actually end up hurting you in the long run:

1. Home repairs

Sure, you can save money on many home maintenance and repair tasks by doing them yourself. But some home repair needs are too important to take chances with, and cry out for the care of a professional. For example, complex plumbing or electrical work, roof repairs or structural repairs are all home projects that could go terribly wrong in the hands of an amateur.

If you don’t know what you’re doing, you can actually cause more damage than you’re trying to fix – and end up costing yourself more money in the long run than if you had just paid a pro to do the work in the first place. Even in who you choose to hire, you can also cut too many corners. When getting estimates from several contractors, cheaper isn’t always better. Licensed, bonded professionals can mean more money upfront, but in the long run can be more inexpensive and cause less headaches. When it comes to unexpected home repairs, building an emergency fund can really help you so that you don’t have to dig into regular budgets if you have a big expense for your home.

2. Your vehicle

That same principle applies to some types of vehicle repairs. While an oil change or spark plugs are well within the abilities of most DIYers, more complex fixes are probably best left to a professional. Especially since your vehicle’s safety relies so heavily on it staying in good repair. Likewise, buying that really cheap vehicle may seem like a smart money-saving tactic, but how much is it going to cost you in ongoing repairs? Make sure to look at the big picture and weigh all the costs associated with a car before signing for it. Also, if your credit is good, you can often save money on auto loans if you qualify for lower rates. If you check your credit report and score, you can see where you stand before you go to buy a car.

3. Food shopping

There are two basic reasons Americans eat fast food: it tastes good and it’s really, really cheap. It’s hard to argue in favor of a salad when the salad bar at your local grocery store can cost you $8 for a modestly sized salad and you can hit the local drive-through and feed your entire family a full fast food meal for about the same amount. You can often find coupons and healthy recipes online to save money and make healthy food at home. In the long run, however, spending a little more on healthful food is well worth the investment. Not only will you stay healthier, your good health can help you save money on medical bills and insurance costs.

4. Dollar store “deals”

Have you ever walked into the dollar store intending to pick up a package of thank you notes or a roll of wrapping paper – only to walk out $50 later with a load of stuff you didn’t intend to buy and probably don’t need? When something costs “just $1” it can be easy to get caught up in the thrill of “saving money.” But often, those items are things you have no use for, or that are so poorly made they’ll break or wear out quickly, or just won’t work at all. The old adage “you get what you pay for” still applies. Dollar stores are great for some items, but they certainly shouldn’t be a regular stop. Instead, save your money and buy something of better quality that you really need.

Staying smart with your money in all the right ways will help you have more to spend on important purchases and allow you to have a little fun along the way, too.

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Key Things to Know when recovering from Identity Theft

Posted on August 9, 2012 by Blog Team

Multiple federal and state laws exist to protect consumers from identity theft, and if you become a victim, you do have rights under those laws. It pays to educate yourself about your rights under the laws.

Identity Theft

Multiple federal and state laws exist to protect consumers from identity theft. It pays to educate yourself about your rights under the laws.

The Federal Trade Commission offers a great rundown of your rights under federal law when you’re recovering from identity theft. Those rights include:

  • Filing of a highly detailed identity theft report with a law enforcement agency. You can use this report when dealing with credit bureaus and companies that have been involved in the fraud.
  • Placing a 90-day initial fraud alert on your credit files if you suspect you’re a victim of identity theft but don’t yet have verification. This lets anyone who views your credit report know that they need to verify who’s applying for credit in your name. You need contact only one of the three major credit bureaus to initiate the alert, and that bureau will take care of passing the information on to the other two.
  • If you become a victim of identity theft, placing a seven-year extended fraud alert on your credit files. For this type of alert, you need to work with each of the three major credit reporting companies directly.
  • Obtaining a free copy of your credit report and a summary of your rights from each credit bureau.
  • Asking the bureaus to block fraudulent information from appearing on your credit report.
  • Disputing fraudulent or inaccurate information on your credit report. The credit reporting company is required to investigate your claim and fix your report if they verify the information is fraudulent.
  • Preventing creditors and debt collectors from reporting fraudulent accounts to the credit reporting companies, once you’ve given them a valid copy of an identity theft report.
  • Obtaining copies of documents related to the incident of identity theft. This could include things like applications used to pen new accounts or transaction records.
  • Stopping debt collectors from pursuing you for fraudulent debts.

In addition, if you become the victim of identity theft, you can’t be held liable for more than $50 of fraudulent credit card purchases as long as you alert the credit card company within 60 days of the credit card statement on which the fraudulent charges appear. Some credit card companies won’t even hold you accountable for the $50 permitted under the law. The same limitation applies to your ATM or debit card, but you must notify the bank within two business days after you realize your card is missing.

If a fraudulent electronic withdrawal shows up on your bank or credit card account, and your debit card is still in your wallet, you’re not liable for any charges as long as you alert the financial institution within 60 days of the statement date.

Your state may offer additional protections, and you should check with your state attorney general’s office if you think you’ve been the victim of identity theft.

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Interpreting Real Estate Listings: The Straight Scoop

Posted on August 7, 2012 by Blog Team

When it comes to interpreting real estate listings, first-time homebuyers can feel like they need a decoder ring. Even veteran shoppers will often come across an abbreviation or euphemism that leaves them scratching their heads in confusion.

When it comes to interpreting real estate listing, first-time homebuyers can feel like they need a decoder ring.

With great mortgage rates and plenty of inventory tempting many people to go home shopping this summer, we think it’s probably a good time to give you some help interpreting real estate listings and some common terms (and not-so-common ones) you’ll come across.

Abbreviation translation:

Bath – You’ll see bathrooms referred to in several ways, including “ba.” Often, bedroom and bathroom info will be lumped together. For example, 4b/3b would likely mean the house has four bedrooms and three full baths. But you’ll also see 3/4b, which means a three-quarter bath, which is a bathroom that has a toilet and sink, and either a tub or shower stall, but not both. A three-quarter bath is different from a powder room (pwdr) or half-bath (half, 1/2b) which lacks any kind of bathing facilities.

Bedrooms – The easiest one to interpret and almost always represented with a number and the letter “b.”

Other rooms – Here’s where things can get confusing, because some listing agents go their own way when abbreviating other rooms in the home. Common room abbreviations include: “dr” for dining room, “br” or “b” for bedroom, “kit” for kitchen, “lr” for living room and “fr” for family room – although it may also be used to mean fireplace.

Other abbreviations – Sometimes, you’ll see an unfamiliar abbreviation that you can guess the meaning of, such as “gar” for garage. Others, like “glfp” for gas log fireplace, may be too esoteric to interpret. Your best bet in those cases: ask the listing agent to translate.

Sweet talk and what it really means

“Charming/Cozy” – A very nice way to say the house is small – maybe 1,000 square feet or less.

“Rustic” – Often a heads-up for bathroom issues, such as a home with only one bath, or a bathroom without a bathtub or shower.

“Fixer-upper” and “needs TLC” – These words almost certainly mean the house needs some work, possibly a lot of work, depending on the listing agent’s propensity for poetic license. The work in question could be merely cosmetic such as painting or landscaping, or it could be more serious, like electrical, plumbing or exterior siding. Taking this one on may require use of additional credit – or even a credit card – to bring it up to your standards.

“Icy-cold A/C” – The air conditioner works, but there’s no heat. Or, the house doesn’t have central air but the current owners have graciously agreed to bequeath the window units to the new owners.

“Loads of character” – The house was built in the 1940s (or earlier) and hasn’t been renovated or upgraded since. Or, a previous owner was overly fond of chartreuse and installed vinyl siding custom made in that color.

“Great potential” – See “fixer-upper” and “needs TLC.”

“Motivated seller” – This is a euphemism you should be happy to see. It can mean several things. On the positive side, it may indicate an owner who is relocating for a job and needs to sell quickly, which could help you save money. On the negative side, it could mean owners who are a step away from foreclosure proceedings and are trying to unload the house before the bank catches up with them.

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Summer Camps We Would Like to See for Grownups

Posted on August 2, 2012 by Blog Team

School’s out and camp is in. Across the country, kids are playing tennis, fishing, swimming, horseback riding, and kicking, throwing or hitting every type of ball imaginable. They’ll also be learning other valuable lessons, like how to get along with different personalities and the value of an active lifestyle.

Just because school is out and summer is in does not mean learning is over. Everyday is a great day to learn about money!

Lots of grown-ups could benefit from that kind of life-skill-building experience too. Here are some summer camps we’d like to see that would help adults learn how to handle money:

Financial Arts Camp – Creating a solid financial footing is a lot like summer camp craft-making. You start out with a lot of pieces that may not look like much at first, and it takes time, patience, creativity and the ability to follow complex directions to make something out of all those parts. Financial Arts Camp would help adults understand how all those pieces come together to build the smart money management that leads to financial health.

Credit Slam Dunk Camp – At dunk camps, kids learn to do one thing well – put a basketball through a hoop – but that one thing is a key requirement for scoring well in the game. Your credit score is the same. It’s just one piece of your financial well-being, but it’s an important one. If you don’t know how to handle your credit, you’ll wind up missing the shot  more often than not when you decide to use it, and that can leave you with a low score. A low credit score can make it very difficult to “win” when it comes to your finances.

Investment Invention – Invention camps teach kids the basics of engineering, mechanics and physics. Investment Invention camps would teach adults the basics of investing, including the mechanics of how the stock market works, how to engineer an investment plan that achieves their goals and the physics of how their investment strategy will affect their wallet throughout their lives.

Savings CPR – Kids as young as 5 or 6 years old can learn basic lifesaving skills, and many teens know CPR. Plenty of adult Americans could use some resuscitation help with their savings habits. In June, the U.S. Department of Commerce’s Bureau of Economic Analysis reported that the personal saving rate in May was 3.9 percent of disposable income. [e1] There’s no downside in getting your personal savings rate higher than the average. Savings CPR would teach adults the basic skills they need to know to breathe new life into their savings habits.

Of course, you probably won’t see these camps opening up any time soon, but you can find plenty of help if you want to take control of your finances. From online courses and community college offerings, to tips and hints on government websites, college and university sites and even consumer companies like Experian. There’s plenty of good information out there. It’s up to you to find the “camp” that works for you.

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Negotiating Tips: How to Get a Raise

Posted on July 31, 2012 by Blog Team

Income growth is an essential component of financial security. Unfortunately, there’s no guarantee that your income will grow unless you take steps to ensure that it does. In this economy, taking those steps can feel like trying to jog while wearing lead shoes.

Employer Credit Check

Income growth is an essential component of financial security. There is no guarantee that your income will grow unless you take steps to ensure that it does.

One of the most obvious ways to increase your income is to ask for a raise from your current employer. Yet for many of us, that’s easier said than done. In fact, the L.A. Times recently reported that a LinkedIn survey found 42 percent of American workers are uncomfortable with career negotiations like asking for a raise.

If you’re wondering how to get a raise from your boss, here are a few suggestions that may help you feel a little better about the challenge:

  • Know what you’ve accomplished. Before you sit down with your boss and ask for more money, take inventory of your achievements. Make a list of tangible results and times when you went the extra mile for the company. If your efforts had a measurable dollar impact on your employer’s bottom line, be sure to make note of that. Create a list of your achievements that you can refer to when you’re face-to-face with your boss; this way, if you’re nervous you won’t forget what you want to say.

 

  • Know what you’re worth. Do some online research to find out what others with your experience and skill levels are earning today for doing the same job. This will help you know how much to ask for. One caveat: if there’s a huge disparity between what you’re earning and what the going rate is for your job, don’t expect your employer to make up the entire amount with the first raise. It may take more than one increase over the course of a year or more to do that—and only if your employer is willing.

 

  • Keep things professional, not personal. It can be difficult to keep your cool when you’re talking about something as important as salary, but emotion has no place in your negotiations. Stick to the facts. Maintain your professionalism, even if your boss says something you feel is less than professional. You’ll have a better chance of making your case if you stay the better person.

 

  • Dress for success. Negotiation day is not the day to push the fashion boundaries at work. Dress professionally. You don’t need to wear your interview suit (or maybe you do, depending on the formality level of your company), but your attire should be neat and clean and appropriate for your job.

 Realize that sometimes the answer will be no, no matter how much you deserve it and how well you plead your case. The reality is in this economy, some companies are unable to give raises and others are unwilling. If the answer is “no,” you have a few other options for growing your income: you can try again in a few months, you can get a second job, or you can look for a new employer. Only you can decide which of those options is right for you.

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Silly Spending Habits Part 1: Missing the Big Picture

Posted on July 26, 2012 by Blog Team

People do some silly things with money. Maybe you get caught up in a moment and buy something pricey that you just don’t need – or have any use for. Perhaps you cut back on your 401(k) contribution in favor of having a bit more spending money each month.

We all have spending habits that we don't think about, even ones that would make us roll our eyes at ourselves if we actually considered what we we're doing.

 We all have spending habits that we don’t think about; even ones that would make us roll our eyes at ourselves if we actually considered what we’re doing. Here’s one that boggles the mind – but we’ve all done it at one time: Blowing a bundle impulsively when we have trouble saving for a big-ticket item.

 For example, you may tell yourself there’s just no room in your personal budget to save for that plane ticket home to visit family. You’ll just put the cost on your credit card and pay it off over several months, you tell yourself. The next day, you go to the local wholesale club store and drop $250 on groceries.

 We’ll bet you could find a way to trim at least $25 off that bill by eliminating things you don’t really need. That cash could then go into your savings and in a few months you would have the money to pay off that ticket immediately, instead of paying credit card interest on it.

 Here’s another one: You balk at spending $400 on new tires for your car and decide to put off this necessary expense for another month. For the next 30 days, you stop in at the coffee shop every morning and pick up your daily $8 extra-large, super-special cup of coffee. If you had made coffee at home every day and pocketed that $8, by the end of the month you would have nearly enough to pay for those tires.

 When we’re faced with a large one-time payout, we cringe at the cost because it’s easy to see the magnitude of the expense. Yet when we spend in smaller increments, like that cup of coffee, our brain can trick us into thinking we’re not really spending that much. Looking at the bigger picture, we can see that those costs add up.

 What silly spending habits do you have? And how do you work to build better money habits?

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Great ’80s Movies and the Smart Financial Lessons They Teach

Posted on July 24, 2012 by Blog Team

It’s summer movie blockbuster season! Will you be watching aliens taking over the world? Or taking in a comedy or romance?

The '80s are known for some of the coolest or worst movies ever made. Either way we can still take away some smart financial lessons from those films.

The ’80s are known for some of the coolest – or worst, depending on your viewpoint – movies ever made. And while the decade also has a reputation for the free-spending lifestyle that led to the recession of the early ’90s, we can still take away some smart financial lessons from those films.

Here are a few of our favorites, and the financial lessons they taught us:

The Film: “Say Anything,” 1989

The Lesson: Never give up.

John Cusack’s well-meaning slacker Lloyd Dobbler falls for the over-achieving valedictorian and goes to great lengths to win (and keep) her heart. Lloyd paid his dues and soldiered on until he achieved his goal. Managing your money is like that – you need to pay what you owe and keep working toward your financial goals.

The Film: “Labyrinth,” 1986

The Lesson: – You have the power over your money.

Long before she won an Oscar, Jennifer Connelly was running around a fantasy maze trying to get her baby brother back from the evil Goblin King David Bowie (rocking a Tina Turner ‘do that actually worked for him). Realizing she’s in control, not the goblin, is what gives Sarah the power to win. Your relationship with money should be like that. You need to control your money, not allow it to control you.

The Film: “Raiders of the Lost Ark,” 1981

The Lesson: How to deal with an emergency.

From a huge boulder rolling toward him to a pit of snakes, hundreds of evil Nazis and an ancient battery on meltdown, Indiana Jones faced more than one emergency in this film. He overcame each one with a combination of preparation (he always had his trusty whip), level thinking (why engage in a sword fight when you have a gun) and creativity (when all else fails, throw a punch and hold on). Dealing with financial crisis can be like that. You need to be prepared with an emergency fund, keep a level head and be creative with your solutions.

The Film: “Ghostbusters,” 1984

The Lesson: Entrepreneurship can pay off.

A team of lovable misfits, led by Bill Murray, finds a unique way to make money, using their singular skill sets. With unemployment still high, now may be the time to follow their lead and become an entrepreneur. Working for yourself doing something you enjoy and that you’re good at can be personally and financially rewarding. Just make sure you go into the endeavor with a plan, otherwise you could get slimed!

The Film: “Cocoon,” 1985

The Lesson: Have a plan for your retirement.

A group of Florida pensioners get a new lease on life when they encounter beneficent aliens. We can only assume these retirees were in the right place at the right time because they set aside money to fund a pretty decent retirement lifestyle in Florida. Fail to plan for your own retirement, and it’s unlikely you’ll be rescued from financial struggles by kindly aliens.

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