Liz’s Blog Category
We recently lost my wonderful mother-in-law to complications from a stroke following a diagnosis of cancer. As we prepare for her memorial service, I’ve been thinking about what a blessing it’s been to be able to help care for parents in their final days—and to do so without having to worry excessively about expensive plane tickets, time off work and other potential financial burdens.
If you have parents who are elderly or in poor health, consider opening a savings account dedicated to making their lives, and yours, a little easier. That fund can pay for:
Getting there. In the five years my mom battled cancer, I spent a small fortune on plane tickets getting from my home (which was then in Anchorage) to hers in Washington state. Sometimes, these were pretty routine visits where I could plan ahead and score reasonable fares. Other times, I’d get the call that there was a crisis and that I needed to get there fast, grabbing whatever seat I could. Because I didn’t carry credit card debt and had a fat emergency fund, I was able to buy airfares without triggering a financial crisis.
Some other tips: Sometimes reward seats open up at the last minute, so if you have frequent flyer miles you can use, check out that option. If you’re within driving distance, consider buying a $50 or $100 gas card and setting that aside for use in emergencies.
Being there. About three years into her fight, Mom had a serious setback. Dad was providing most of her care and he was overwhelmed. I was able to take a two-month unpaid leave from work to help out—again, thanks to my emergency fund and to the flexibility of my employer, which held my job for me. (This was before the passage of the Family and Medical Leave Act of 1993, which allows covered employees to take unpaid, job-protected leaves to care for a spouse, child or parent with a serious health condition.) Two months with no paychecks took a serious bite out of that savings account, but I’ll never regret the cost. I was able to take another month off a couple of years later, at the end of her life, and was again so grateful to be able to be there.
Getting help. A few years ago, my father had a massive stroke while visiting a relative in Florida. We couldn’t fly him home, since he was too ill to travel. To help us manage his care long distance, we hired a geriatric care manager who was worth her weight in gold. She not only translated the medical-ese that baffled us, but helped us find a good nursing home for him and a friendly companion who could keep him company in between my frequent visits. Families are often left on their own to figure out how to care for an incapacitated relative, and she hooked us up with resources we might never have found otherwise. None of this was cheap—we spent about $10,000 on the care manager alone over four months—but she dramatically shortened our learning curve and ensured my dad got good care at the end of his life. Whenever friends are dealing with an ill or declining parent and don’t live nearby, I encourage them to hire a geriatric care manager to help them assess the situation and find solutions. A session with a care manager can even help when you live locally, since these folks live and breathe elder care, which is a new world to most of the rest of us.
It’s impossible to know in advance how much money you might need, but anything you can set aside will help ease the financial burden when the time comes to help your folks.
In case you missed them, here are some of the issues I’ve been writing about recently:
A much-heralded new version of the VantageScore could offer big benefits to consumers, but only if lenders actually start to use it. Read all about it in “New credit score could change lives.”
HSAs still aren’t a household acronym, but more companies are offering these health care accounts–and yours might be next. For the right people, HSAs can be a way to supercharge your retirement savings since they allow you to invest unused cash contributions in stocks. But you also run the risk of having the market wipe out your health care funds right when you need them. Read “Should you invest health care funds?” for more.
Divorce doesn’t necessarily separate your credit obligations, and a vengeful or oblivious ex can really mess up your credit. Learn what you should know before and after your split in “Don’t let your ex trash your credit.”
Are you giving identity thieves the clues they need to hack into your life? If you use social media, the answer may be yes. Read “Secrets you should yank off Facebook now.”
“Deal with Your Debt” is now available, and I’m giving away five copies this week.
To enter to win, leave a comment here on my blog (not my Facebook page).
Click on the tab above the post that says “comments.” Make sure to include your email address, which won’t show up with your comment, but I’ll be able to see it.
If you haven’t commented before, it may take a little while for your comment to show up since comments are moderated.
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!
My new book “Deal With Your Debt” will be released in a few days (you can order it here), and I need to make some room on the bookshelf. So I’m giving away five copies of my previous book, “The 10 Commandments of Money.”
To enter to win, leave a comment here on my blog (not my Facebook page).
Click on the tab above the post that says “comments.” Make sure to include your email address, which won’t show up with your comment, but I’ll be able to see it.
If you haven’t commented before, it may take a little while for your comment to show up since comments are moderated. But rest assured, it will.
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!
Rewards card ninjas have long loved hotel rewards cards because the associated loyalty programs tend to be a lot more generous and easy to use than airline cards.
That may be changing.
Brian Kelly at The Points Guy has an excellent series of posts on the coming changes in hotel rewards programs, and there’s not much good news. (You can start with his post “The State of Hotel Loyalty Programs: A Devaluation Story.”) Starwood and Marriott are diluting their programs, but some of the most dramatic changes are in the Hilton HHonors program, which will not only require more points for most stays but will upgrade a bunch of properties to higher, more expensive categories. Hotels like the Conrad Tokyo will go from 50,000 points per night to 80,000 to 95,000 points.
In a warning to hotel loyalty programs, Kelly says these changes could come back to haunt them:
As you hack away more and more of the value proposition, I think you’ll realize that consumers are actually pretty smart and will start shifting their spend towards chains that actually reward loyalty and not punish it. This may not come in the form of traditional points, but many boutique hotels offer far more enriching experiences with more amenities and at cheaper prices. This Hilton devaluation was so brazen that I do think it will hurt them dearly in the end when Amex and Citi cardholders reduce their spend or cancel their cards. In fact, if the impact is so negative, I could see those issuers coming after Hilton since there are likely clauses in the contracts that state that Hilton can’t materially change the program (since the credit card companies are buying millions of dollars worth of points that their cardholders can use at a later time and date). I’ll be complaining to both American Express and Citi about the Hilton changes and hope everyone else considers doing so as well if you don’t like the changes.
Even if you plan to stay loyal to your card, the program devaluations underscore what has always been true: you don’t want to hoard rewards. Earn ‘em and burn ‘em to make sure you get the most value.
My recent MSN Money columns, in case you missed them:
How to avoid tax-return rip-offs Beware of promises to get your refund faster. Refund anticipation loans are gone, and what’s replaced them isn’t worth the cost.
Gay marriage can muddle finances Gay and in love? You might want to wait to marry.
‘Boomerang’ kids: Moving out again Household formation is on the rise and the kids who moved into their parents’ basements are finally able to move out on their own. Here’s what they, and their parents, need to know to avoid future boomerangs.
Simple retirement can be satisfying If you haven’t saved much for retirement, all is not lost as long as you’re willing to pursue a much simpler lifestyle than what you’re probably living now. One man who lives just such a life is happy he does.
A few months ago I gave a verbal spanking to a woman who equated college loans with handouts. She wondered why people didn’t just delay college for a year and earn enough money to pay for their entire education, as she did back in the day.
I pointed out that there weren’t many jobs available to newly-minted high school graduates that paid $60,000, which is about the minimum you’d need to pay for a four-year degree today.
Apparently my reader isn’t the only one having trouble keeping up with the times. A recent New York Times story quoted Virginia Foxx, a Congresswoman from North Carolina who heads a House subcommittee on higher education and work force training, saying she was bewildered why people went into debt instead of working their way through school the way she did.
Here’s what Times writer Ron Lieber pointed out:
But students nowadays who try to work their way through college without parental support or loans face a financial challenge of a different order than the one that Ms. Foxx, 69, confronted as a University of North Carolina undergraduate more than 40 years ago. Today, a bachelor’s degree from Appalachian State, the largest university in her district, can easily cost $80,000 for a state resident, including tuition, room, board and other costs. Back in her day, the total was about $550 a year. Even with inflation, that would translate to just over $4,000 for each year it takes to earn a degree.
A plucky, lucky few manage to get through college with no loans or parental support. But many of those who try wind up dropping out, unable to balance the work hours required with the demands of school.
If you’re one of those who may be stuck trying to pay your own way, Zac Bissonnette’s book “Debt Free U” can provide helpful guidance. If you’re a parent or a policymaker, however, you should check your views about the viability of kids’ working their way through college with today’s realities.
A woman who works as a nanny and housekeeper wrote into the Wall Street Journal recently. Her employers had paid her under the table for years. As a result, at she’s facing retirement with only a miniscule Social Security benefit.
This drives me nuts. If you can afford to hire a nanny or a housekeeper, you can afford to pay her taxes.
Yes, you can.
The employer half of payroll taxes for Social Security and Medicare is 7.65%. The cost of hiring someone to do the paperwork is around $500 a year. (I use the Nanny Tax Company, which charges a $100 one-time set up fee and a $475 annual preparation fee. Each additional employee after the first one is $125.) Those aren’t exorbitant sums. If you can afford to hire help, you can afford to pay the taxes that are legally required as a household employer.
(I’m assuming that your household help can legally work in the U.S. If that’s not the case, well—that’s a matter for a whole different column.)
There’s a line between frugal and cheap. You cross that line when you force other people to pay the price while you save money. The people you entrust with your children and your home deserve better.
You have questions about money–everybody does. Now you have the opportunity to get answers from some of the best financial planners in the business.
Fee-only planners from NAPFA, the National Association of Personal Financial Advisors, will be answering your questions from 9:00 a.m. to 5:00 p.m. Eastern time on Thursday, February 7 and Tuesday, February 12, 2013.
The events, hosted by Kiplinger, will include four chat rooms focusing on:
- Taxes and retirement
- Saving for retirement
- Income in retirement
- Other financial challenges
More gas stations in Los Angeles seem to be charging a premium to use a credit card. One 76 station near my home charges 20 cents more per gallon, to be precise.
I only noticed the difference after I swiped my card and was about to press the key to start the pump. I checked the station’s signage, and noticed the display advertising the “cash” price was a lot bigger than the one showing the “credit” price.
Technically, California has a law that’s supposed to prevent surcharges for plastic. But as my buddy David Lazarus has pointed out in his column, Section 1748.1 of the California Civil Code has some big fat loopholes. Gas stations get away with double pricing because they’re supposedly offering a discount for cash, not a surcharge for plastic.
Now that retailers elsewhere in the country can add surcharges to Visa and MasterCard transactions, the question is: will they?
Those of us who love our credit card rewards programs—including the rewards card ninjas I highlighted in my column this week—hope the answer is no. It wouldn’t take much of a surcharge to wipe out the value most people get from their rewards cards.
Brian Kelly, the founder of The Points Guy, says retailers who add surcharges could be shooting themselves in the foot.
“High-end consumers love their rewards,” Kelly said. Retailers who don’t add surcharges will have a competitive advantage, which could make attempts to impose the fees short-lived.
I know that I’ll vote with my feet. Once I noticed I was about to pay $4.09 cents a gallon, rather than the $3.89 I expected, I hung up the nozzle. I didn’t have to drive far to find a Mobil station that charged $3.89, cash or credit. Guess where I’ll be gassing up in the future?