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Q&A: Work from home jobs

Jul 14, 2014 | | Comments Comments Off

Dear Liz: Are there legitimate “work from home” Internet job opportunities, or are all those advertisements just scams?

Answer: You should be skeptical of advertisements in general and particularly advertisements about an area as scam-filled as work-from-home opportunities.

Yes, many people make a living working from home. They’re typically employees of companies that allow them to telecommute, or they’ve launched successful businesses or they’re answering phones for a call center. They are not unskilled people making a killing at jobs that require little effort, which seems to be what most of the scams promote.

You can research legitimate opportunities by starting with legitimate websites. AARP, Bankrate.com and Kiplinger all have good articles on the topic.

Categories : Q&A
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Q&A: How to escape a timeshare

Jul 14, 2014 | | Comments (3)

Dear Liz: How do I walk away from a timeshare? It’s paid off but we have yearly maintenance fees that are now $3,600 each year. This will be prohibitive in retirement, and it’s quite a burden now. The developer won’t let us give it back, and we can’t sell it because the resale companies are sharks that demand money upfront. Can they ruin our credit if we stop paying? Is there any way to protect ourselves?

Answer: If you stop paying your annual maintenance fees, your account can be turned over to a collection agency. That will trash your credit, and you could be sued.

Many people who buy timeshares don’t realize they’re making a lifetime commitment, said Brian Rogers, owner and operator of Timeshare Users Group. Even after any loans to buy the timeshare are paid off, owners owe maintenance fees on the property. Maintenance fees typically rise over time and may be supplemented by special assessments to repair or upgrade resorts as they age.

The good news is that you may be able to get out from under these fees by selling your timeshare, and you don’t have to use a resale company that charges an upfront fee. In fact, you shouldn’t, since those arrangements are frequently scams, Rogers said.

The amount you’re paying indicates that you own a timeshare at an upscale resort. (The average maintenance fee is closer to $800 a year, Rogers said.) If that’s the case, your timeshare may have some value, even if it’s only a tiny fraction of what you paid. Owners at less desirable resorts often find they can sell their timeshares for only $1, and may have to pay others to take the timeshares off their hands.

You can list your timeshare for sale at no or low cost on EBay, Craigslist, RedWeek or Timeshare Users Group, among other sites. To get some idea of what it’s worth, enter the name of the resort into EBay’s search engine and click on the “completed sales” box on the lower left side of the page. Timeshare Users Group and RedWeek offer additional advice on selling timeshares.

You also could consider renting out your timeshare, using those same sites. Many owners discover they can offset or even completely cover their maintenance fees through such rentals, Rogers said.

Categories : Q&A, Real Estate
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Q&A: How to fund a Roth IRA

Jul 14, 2014 | | Comments Comments Off

Dear Liz: I have quite a bit invested in stocks in a regular brokerage account. I’ve held them for many years, and to sell them would mean huge capital gains taxes. I’d like to move some of these into a Roth IRA, so that I can avoid paying taxes on their appreciation and dividends, since I plan to hold these for quite some time. Is it possible to move these stocks into a Roth IRA without selling and repurchasing?

Answer: Nope. Uncle Sam typically gets his due, with one major exception.

Roths have to be funded with cash, and direct contributions are limited to $5,500 per person per year, plus a $1,000 catch-up contribution for those 50 and over. Your contributions would be further limited once your modified adjusted gross income exceeds $181,000 for married couples and $114,000 for singles, said Mark Luscombe, principal analyst for tax research firm CCH Tax & Accounting North America. A big-enough capital gain, on top of your regular income, could push you over those limits.

If you want to avoid paying capital gains, just hold the investments until your death. Your heirs will get the investments at their market value and can sell them immediately without owing any capital gains. There may be other taxes involved, however. If your estate is worth more than $5 million, it may owe estate taxes, and a few states levy inheritance taxes on heirs.

Categories : Investing, Q&A, Retirement
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Friday’s need-to-know money news

Jul 11, 2014 | | Comments Comments Off

imagesToday’s top story: The biggest mistakes car buyers make and how to avoid them. Also in the news: How to land your dream home this summer, saving big on your wedding expenses, and how we can learn from the money mistakes of celebrities.

5 Mistakes Car Buyers Make
Pay attention to how long you’ll pay.

7 Ways to Land Your Dream Home During the Summer
Look for a diamond in the rough.

Easy ways to save $10,000 on your wedding expenses
Location, location, location.

5 celebrity money mistakes we can all learn from
One word: prenup.

Cash 4 Phones: 5 Tricks to Buying and Selling Used Electronics
Turn those dust collectors into cash.

Categories : Liz's Blog
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Our apartment in Paris

Jul 09, 2014 | | Comments (1)

Eiffel TowerWe’ve settled into our home for the next few weeks: a comfortably funky 3-bedroom apartment on the top of an older building not far from the Moulin Rouge.

Travelers will tell you that if you’re planning to stay more than a few days here (and indeed in many major cities), it makes a lot more financial sense to rent a place than to stay in a hotel. Not only is it cheaper*, but access to a kitchen and (often) a washer and dryer will further reduce your costs. And this time, I knew enough to get a place with an elevator.

Another way to travel cheaper: public transport. We’re less than a block from a Metro station and the bus stop is literally across the street. Several grocers and a good boulangerie (bakery) are nearby, as well as a number of restaurants when we don’t feel like cooking.

We used the Homelidays site, now known as HomeAway, to find this place, and AirBnB to book a flat in Edinburgh.  I relied heavily on other users’ reviews, seeking out the listings that have a bunch of them. (I’ll let other people take a chance on the newbies.)

The one thing we gave up was flexibility. Most of the listings we considered had pretty strict cancellation policies, with substantial deposits (usually half the rent) and steep forfeitures if you change your mind. Fortunately, our plans were pretty well set.

*We’re paying about $140 a night for three bedrooms and two baths. Before we arrived, we spent one night at the Westin Paris Vendome using points. The room we occupied typically costs over 500 euros per night, or nearly $700. There are much cheaper hotels, obviously, but you typically pay a couple hundred bucks for a small room, so renting an apartment can really make sense.

 

 

Categories : Liz's Blog
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Wednesday’s need-to-know money news

Jul 09, 2014 | | Comments Comments Off

Zemanta Related Posts ThumbnailToday’s top story: Learning what identity thieves want you to do. Also in the news: Saving money as a wedding guest, market myths that can make you poorer, and how to manage your money emotions.

5 Things Identity Thieves Want You to Do
How to do the opposite.

Tips to Save Money as a Wedding Guest
How to celebrate the happy couple without going broke.

7 market myths that make investors poorer
Mythbusting!

How to Manage Your Money Emotions
Reining in emotional spending.

5 Financial Lessons Everyone Should Learn in Their 30s (Did You?)
It’s never too late.

Categories : Liz's Blog
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DrowningA reader whose credit scores have already been badly damaged by late payments and charge-offs had a question: How much more would her scores drop if she filed for bankruptcy?

For years the creators of the leading FICO credit scoring formula were a bit vague about the answer, saying only that a bankruptcy filing is “the single worst thing” that can happen to your scores.

Three years ago, though, the FICO folks provided a peek into how the formula treats a bankruptcy filing as well as other major negatives. You’ll find the post that covers that topic on FICO’s Banking Analytics blog. I go into more detail about this in my book “Your Credit Score,” but you’ll see that, indeed, the impact of a bankruptcy is bigger than that of other negatives. As with other black marks, a bankruptcy hurts already battered scores proportionately less than it does those with higher scores. But in the three examples given (people who started with scores of 680, 720 and 780), everyone ended up in the low to middle 500s. Not a great place to be. Futhermore, it takes years for credit scores to recover. To get back to “good” credit of 720 and above will take 7 to 10 years.

So does that alone mean people should avoid bankruptcy? Heavens, no. Bankruptcy puts a legal end to collection efforts and the ongoing damage unpaid debts can do to your scores. If you can get your act together and start using credit responsibly after a bankruptcy filing, you can start to rebuild your scores immediately. If you continue to struggle with un-payable debt, you may never be able to rehabilitate your credit.

Obviously, if you can pay your debts, you should. Many people who can’t wind up doing themselves more damage, and throwing good money after bad, in vain struggles to pay their bills. If you’re falling behind and can’t see how you’ll catch up, you’d be smart to at least talk to a bankruptcy attorney about your options.

 

 

 

Categories : Liz's Blog
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Tuesday’s need-to-know money news

Jul 08, 2014 | | Comments Comments Off

Zemanta Related Posts ThumbnailToday’s top story: What to do when your 401(k) and IRA are maxed out. Also in the news: Comparing medical loans and credit cards, three essentials that could be missing from your retirement plan, and thirteen factors to consider when picking a place to retire.

What to Do After Your 401(k) and IRA Are Maxed Out
Where to invest your money next.

How to Compare Medical Credit Cards, Loans
Prepare for high interest rates.

3 Essentials Missing From Many Retirement Plans
Don’t forget these essentials.

13 Factors to Consider When Choosing a Place to Retire
It’s time to make a list.

10 tips for buying your next car for less
Don’t be afraid to haggle.

Categories : Liz's Blog
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Monday’s need-to-know money news

Jul 07, 2014 | | Comments Comments Off

imagesToday’s top story: Maintaining good credit without carrying debt. Also in the news: Taking out the right amount of mortgage, how to keep your home cool for less, and what happens when your student loan co-signer dies.

How to Maintain Good Credit Without Debt
Can you build credit without going into debt?

How Much Mortgage Can You Handle?
How not to get in over your head.

How to Keep Your Home Cool this Summer for Cheap
Staying cool without breaking the bank.

Am I Completely Screwed If My Student Loan Co-Signer Dies?
Pretty much.

Categories : Liz's Blog
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Dear Liz: I am 64. I recently reviewed my Social Security summary online and saw that it does not have an accurate listing of my income, so the projections of my benefits aren’t accurate either. How do I correct these errors?

Answer: There are a number of ways the Social Security database could be wrong. An employer could have reported your earnings incorrectly or not at all. Or your earnings could have been reported using the wrong name or an incorrect Social Security number. If you married or divorced and changed your name, but failed to notify Social Security, that also could lead to errors in your record.

You can call the Social Security help line at (800) 772-1213 to start the process of correcting your records. It would be best if you have proof of your earnings, such as W-2 forms, tax returns or pay stubs from the years in question. If you don’t have such proof, the Social Security Administration asks that you provide as much information as possible about where you worked, the name of your employer(s), the dates you worked and how much you earned.

Your experience shows why it’s important to periodically review your Social Security records to make sure they’re accurate. This year the Social Security Administration will resume sending paper statements to certain workers (those aged 25, 30, 35, 40, 45, 50, 55 and 60), but in the meantime you can check your records online by signing up at http://www.ssa.gov/mystatement/.

Categories : Q&A, Retirement
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