Thursday’s need-to-know money news

Today’s top story: Financial advisors on what the election means for your money. Also in the news:sol_helpkidssave How your taxes may change in a Trump presidency, how President Trump could affect your student loans, and how to teach kids about money.

Ten Financial Advisors on What the Election Means for Your Money Plan
A look at what happens next.

How Your Taxes May Change in a Trump Presidency
Big changes ahead.

5 Ways President Trump Could Affect Your Student Loans
What this means for interest rates.

Ask Kids to Contribute to a Family Savings Goal to Teach Them About Money
Teamwork.

Wednesday’s need-to-know money news

Zemanta Related Posts ThumbnailToday’s top story: Probate, and how to avoid it. Also in the news: A Class of 2016 Postgrad student loan checklist, how to haggle down your rent by offering to do your own maintenance, and a few things to consider before moving to Canada.

Probate, and How to Avoid It
Learn the three common ways.

Class of 2016 Postgrad Student Loan Checklist
Get ready to start paying back those loans.

Haggle Down Your Rent By Offering to Do Your Own Maintenance
All they can say is no.

6 reasons to think twice before moving to Canada
Some things to consider.

Tough times ahead? Enter to win these books. Plus: discount code.

Updated to add second coupon code. I mentioned earlier this week that I’m giving away a copy of Donna Freedman’s “Playbook for Tough Times,” as well as Abigail Perry’s “Frugality for Depressives.”  (Donna and Abby are mother and daughter.)

Donna just let me know that she’s also offering a short-term discount on the PDF version of “Playbook.” If you don’t win the giveaway, you can get the e-book for $5 through Nov. 30 by using the discount code ASKLIZ at this payment link:snip20161108_3

https://www.e-junkie.com/ecom/gb.php?c=cart&ejc=2&cl=315870&i=1507332

Abby’s offering a $1.99 discount on her book as well. Use the code FRUGALITY to get the book for $5 through Nov. 30:

Visit https://www.e-junkie.com/ecom/gb.php?c=cart&ejc=2&cl=315870&i=1517519

You can enter to win the books by leaving a comment here on my blog (not my Facebook page). Make sure to include your email address, which won’t show up with your comment, but I’ll be able to see it.

snip20161108_2Comments are moderated, so it may take a little while for your comment to show up.

The winners will be chosen at random Friday night. Over the weekend, please check your email (including your spam filter). If I don’t hear from a winner by noon Pacific time on Monday, his or her prize will be forfeited and I’ll pick another winner.

Also, check back here often for other giveaways.

The deadline to enter is midnight Pacific time on Friday. So–comment away!

Tuesday’s need-to-know money news

Pile of Credit CardsToday’s top story: NerdWallet’s best credit card tips for November. Also in the news: How credit card rewards can help pay for the holidays, what to do if your parents don’t have a retirement plan, and the pros and cons of a joint checking account with your parents.

NerdWallet’s Best Credit Card Tips for November 2016
Preparing for holiday spending.

How Credit Card Rewards Can Help Pay for the Holidays
Every little bit counts.

What to Do If Your Parents Don’t Have a Retirement Plan
An important conversation.

Helping out Mom or Dad with a joint checking account? Watch out
The pros and cons.

Book Giveaway: Playbook for Tough Times and Frugality for Depressives

snip20161108_3I’m giving away a copy of Donna Freedman’s “Playbook for Tough Times,” and Abigail Perry’s “Frugality for Depressives.” These books have more than a topic in common–Abby is Donna’s daughter. Both books offer great, realistic advice for getting a handle on your money.

To enter to win, leave a comment here on my blog (not my Facebook page). Make sure to include your email address, which won’t show up with your comment, but I’ll be able to see it.

snip20161108_2
Comments are moderated, so it may take a little while for your comment to show up.

The winners will be chosen at random Friday night. Over the weekend, please check your email (including your spam filter). If I don’t hear from a winner by noon Pacific time on Monday, his or her prize will be forfeited and I’ll pick another winner.

Also, check back here often for other giveaways.

The deadline to enter is midnight Pacific time on Friday. So–comment away!

Great credit is a powerful tool

Credit report with score on a desk

Credit report with score on a desk

Credit scores are a financial tool, but whether they’re a lever or a hammer depends on how good they are.

You can leverage great scores into great deals — on loans, credit cards, insurance premiums and cell phone plans. Bad scores can hammer you into missing out or paying more.

The lifetime cost of higher interest rates from bad or mediocre credit can exceed six figures. In my latest for the Associated Press, how to save thousands of dollars in interest by building great credit.

Monday’s need-to-know money news

stack-of-billsToday’s top story: Why minimum payments on credit cards are designed to keep you in debt. Also in the news: Retirement planning rules Millennials can break, how to choose the right health insurance plan “metal tier,” and why it’s so hard to stick to a budget.

Credit Card Minimums: Perfectly Calibrated to Keep You in Debt
The card companies aren’t on your side.

4 Retirement Planning Rules Millennials Can Break
Or at least bend.

Choosing the Right Health Insurance Plan ‘Metal Tier’
Sadly, no rose gold.

Why Is It So Hard to Stick to a Budget?
Answering the age-old question.

Q&A: What to consider when investing in target date retirement funds

Dear Liz: I have 100% of my 401(k) in a fund called “Target Retirement 2030.” This fund is made of several other funds, so does that qualify as “diversified”?

Answer: It does. Target date funds have become increasingly popular in 401(k) plans because they do the heavy lifting for investors. The funds select asset allocations and grow more conservative in their mix as the retirement date approaches.

Target date funds aren’t perfect, of course. Some are too expensive. The typical target date fund charges about 1%, but Vanguard and Fidelity charge as little as 0.15%.

Another issue is the “glide path” — how quickly the funds get more conservative. There’s no consensus about what the right glide path should be, and investment companies offer a lot of different mixes. Any given glide path may be too steep for some people and too shallow for others, depending on their circumstances. As an investor, you can compensate for that by choosing funds dated later or earlier than your targeted retirement date. If the 2030 fund gets too conservative too fast for your taste, for example, you could choose the 2040 fund instead.

Despite the downsides, you’re likely to be much better off in a target date fund than you are in some of the other options. Too often novice investors take too much or too little risk without realizing it. They may have all of their money in “safe” low-return options, which means they’re losing ground to inflation. Or they may have all their money in stocks, including their own company’s stock, and would be unprepared for a downturn wiping out a good chunk of their portfolio’s value.

Even those who know they should diversify often do it wrong by randomly distributing their contributions across their investment options. If you don’t know what you’re doing, or you simply prefer investing professionals to take charge, target date funds are a good way to go.

Q&A: Life insurance for people over 65

Dear Liz: Can you give us some direction on how to get good term life insurance when you’re over 65? We had 25-year term policies and the premiums skyrocketed, so we are looking. Will getting a group plan (such as the one offered by AARP) help me? I’ve had two heart valve surgeries and knee and hip surgeries but don’t drink or smoke. We are concerned that we may not have enough saved. My wife is still working, but I have not been able to find employment since I lost my job due to a downsizing.

Answer: The options available to you are likely to be limited or expensive or both.

The life insurance program offered through AARP provides up to $100,000 in term coverage that ends at age 80 or $50,000 in permanent life insurance that can extend through your life. There’s no medical exam but you do have to provide health information.

Life insurance with higher limits may be available but you’re not going to like the price, said Delia Fernandez, a fee-only Certified Financial Planner in Los Alamitos. Life insurance after 65 is usually expensive in any case, but those heart valve surgeries could make it much more so, depending on how long ago you had them, how successful they were and what medications you’re on.

Fernandez recommends consulting with an independent life insurance agent so you can get a better idea of what’s available and what it will cost. Once you have an idea of the premiums, you’ll have to weigh whether you’d be better off investing that money instead.

As a general rule, you don’t want to be worth more dead than alive — and not just because you don’t want your spouse contemplating ways to collect. More importantly, insurance coverage that exceeds your income-generating capacity signals that you may be spending too much for insurance and need to consider alternatives.

Q&A: 30-year versus 15-year mortgage

Dear Liz: Regarding the 57-year-old woman who wanted to refinance to a 15-year mortgage, why didn’t you present the benefits of keeping the low interest and low payments available on a 30-year loan and investing the difference? In 30 years the house would be paid off, but there would also be a pot of cash available if the difference were invested in a diverse portfolio. Too many people make the emotional decision that a paid-off house is necessary in retirement, then they end up having no cash when they might need it.

Answer: You’re right that when cash is tight, keeping a mortgage can make sense. Given her teacher’s pension, other savings and desire to pay off the home faster, the 15-year loan is a reasonable option. The faster payoff schedule also means that she can turn around and tap more of the equity in the unlikely event she needs a reverse mortgage later in life.