Thursday’s need-to-know money news

Today’s top story: How to build your ‘Oh, Crap!’ fund. Also in the news: A strategy that could help new grads retire sooner, United Airlines sets a new pet transport policy, and what happens to your debts when you die.

How to Build Your ‘Oh, Crap!’ Fund
Don’t get caught empty-handed.

New Grads, This Strategy Could Mean Retiring Sooner
Doesn’t that sound nice?

United Airlines Sets New Pet Transport Policy
The policy will ban dozens of dog breeds from being transported in cargo.

What Happens to Your Debts When You Die
They don’t disappear.

How to build your ‘Oh, crap!’ fund

The emergency fund is a bust.

Millions of Americans don’t have one, and some of those who do resist tapping what they’ve saved. I’d like to propose an alternative for both sets of people: The “oh, crap!” fund, a savings account for not-quite-emergency expenses.

One of the reasons people don’t have emergency funds is misplaced optimism. People think that if they’re healthy, they’ll stay healthy. If they’re employed, ditto. The car will keep running, the roof will never need to be replaced and, since everybody’s a better-than-average driver, there won’t be any accidents. Behavioral scientists call that “recency bias,” which is the delusion that whatever happened in the recent past will continue into the indefinite future.

Everyone, though, has experienced “oh, crap!” moments: the no-parking sign they didn’t see, the crown the dentist says they need, the smartphone dropped in the toilet. In my latest for the Associated Press, how to build a fund that will take the sting out of emergency expenses.

Friday’s need-to-know money news

Today’s top story: Quick – Can you come up with $400? Also in the news: Is 4-year college right for you, car negotiating secrets for people who hate haggling, and 5myths about your 2017 tax refund and what not to do if you want to do if you want it quicker.

Quick — Can You Come Up With $400?
Most of America cannot.

Ask Brianna: Is 4-Year College Right for You?
Do you really need all 4 years?

Car Negotiating Secrets for People Who Hate Haggling
Negotiating without pressure.

5 myths about your 2017 tax refund and what not to do if you want it quicker
Calling the IRS won’t help.

Thursday’s need-to-know money news

Today’s top story: 5 signs you’re getting bad financial advice. Also in the news: What a financial advisor does, how Roth IRAs can help in an emergency, and why Wells Fargo customer should check their bank accounts.

5 Signs You’re Getting Bad Financial Advice
Who’s really looking out for you?

What Does a Financial Advisor Do?
Reaching your financial goals.

How Roth IRAs Can Help in an Emergency
An emergency backup fund.

Wells Fargo Customers Should Check Their Bank Accounts
There’s been a “glitch.”

Q&A: Help your son by helping yourself

Dear Liz: I’m a new mom and want to start saving for my son’s college/car/other life expenses while also planning a secure future for him. If I only had, for example, $300 a month to put toward this goal, what would you recommend I spend it on? Life insurance? Savings accounts for him? Savings accounts for my household? A 401(k)? Stashing away money under the mattress? Something else I haven’t thought of yet? I just want to make sure I’m doing the very best for my son and our future.

Answer: Congratulations and welcome to the wonderful adventure that is parenthood.

This adventure won’t be cheap. The U.S. Department of Agriculture estimates the cost of raising a child to age 18 is now $233,610 for a middle-income married couple with two kids. Your mileage will vary, of course, but there’s no denying that your income will have to stretch to cover a lot more now that you’re providing for a child.

Your impulse will be to put your son first. To best care for him, though, your own financial house needs to be in order.

Begin by creating a “starter” emergency fund of $500 or so. Many people live paycheck to paycheck, which means any small expense can send them into a tailspin. Eventually you’ll want a bigger rainy-day fund, but it could take several years to build up the recommended three months’ worth of expenses, and you don’t want to put other crucial goals on hold for that long.

Once your starter fund is in place, you should contribute enough to your 401(k) to at least get the full company match. Matches are free money that you shouldn’t pass up.

You probably need life insurance as well, but don’t get talked into an expensive policy that doesn’t give you enough coverage. Young parents typically need up to 10 times their incomes, and term policies are the most affordable way to get that much coverage.

After life insurance is in place, you can boost both your retirement and emergency savings until those accounts are on track. If you still have money left over to devote to your son’s future, then consider contributing to a 529 college savings account. These accounts allow you to invest money that can be used tax free to pay for qualifying education expenses anywhere in the country (and many colleges abroad, as well).

Keep in mind that post-secondary education really isn’t optional anymore, particularly if you want your kid to remain (or get into) the middle class. Some kind of vocational or college degree is all but essential, and the money spent can have a huge payoff in terms of his future earnings.

The emergency fund you can eat

Cash can help you survive an emergency, but saving as much as financial planners typically recommend — three to six months’ worth of expenses — can take years. You can build an edible emergency fund a lot quicker.

A well-stocked pantry can help you survive a natural disaster or extended blackout, get through a stretch of unemployment, ensure you always have something tasty for dinner, and save you money, if done correctly.

The key to doing it right: Store what you eat, and eat what you store.

In my latest for the Associated Press, how to create an edible emergency fund that will help you survive a variety of disasters, both big and small.

Wednesday’s need-to-know money news

Today’s top story: What to do when you haven’t received your W-2s. Also in the news: When you should use your emergency fund, how overborrowing can add over $100 a month to your student loan payment, and how a millennial couple paid off $20,000 in debt in two years.

Haven’t Gotten Your W-2? Take These Steps
Getting your tax docs in order.

When You Should Use Your Financial Emergency Fund
Determining true emergencies.

Overborrowing Could Add $119 to a Typical Monthly Student Loan Payment
Only borrow what you truly need.

How This Millennial Couple Paid Off $20,000 in 2 Years
Sticking to a plan.

Tuesday’s need-to-know money news

Today’s top story: A financial advisor’s tips for starting an emergency fund. Also in the news: How small homes can offer big returns, why partner’s wealth is very important to only 5% of OKCupid users, and how to raise financially savvy kids.

Emergency Funds: A Financial Advisor’s Tips for Getting Started
Start your fund today.

Small Homes Can Offer Big Returns
Bigger homes aren’t always better.

Partner’s Wealth ‘Very Important’ to Only 5% of OkCupid Users, Survey Finds
Why money doesn’t seem to matter.

How to raise financially savvy kids
Getting them off on the right foot.

Wednesday’s need-to-need money news

Image9Today’s top story: Ten smart money moves that take only ten minutes. Also in the news: Healthy money habits to teach your kids, money management apps that automate your finances, and the power of the Get Lost Fund.

10 Smart Money Moves That Take 10 Minutes
You can spare the time.

5 Healthy Money Habits to Teach Your Kids
It’s never too early.

5 money-management apps that automate your finances
Letting your phone do the work.

The Power of the Get Lost Fund
Having the ability to get up and go.

Tuesday’s need-to-know money news

emergency-fund-1940x900_36282Today’s top story: When to ditch your state’s health insurance exchange. Also in the news: Tailgating blunders your insurance will pay for, how to handle unexpected financial disasters, and how much next year’s Social Security cost of living increase will be.

When to Ditch Your State’s Health Insurance Exchange
When to look off of the exchanges.

5 Football Tailgating Blunders Insurance Will Pay For
Accidentally grill your car? You’re covered!

No Savings, No Backup Plan, No Fairy Godmother: How to Handle a Financial Disaster
This is why you need an emergency fund.

Next year’s Social Security raise? Less than $4 a month
Lowering your expectations.