Wednesday’s need-to-know money news

Today’s top story: Unpacking the myths of investing in the stock market. Also in the news: A new episode of the Smart Money podcast on buying cryptocurrency and tackling debt, life insurance companies are becoming more marijuana-friendly, and asking for reconsideration after being denied a credit card.

Unpacking the Myths of Investing in the Stock Market
These stock market myths have no place in your portfolio.

Smart Money Podcast: Buying Crypto and Dealing With Debt
Understanding cryptocurrency and how to tackle your debt head on.

Smoke Weed and Need Life Insurance? Some Companies Are Cool With Marijuana
Not every life insurer is willing to cover marijuana users, but some don’t mind — provided it isn’t a daily habit.

Call a Reconsideration Line for a Second Chance at a Credit Card
Taking a second look.

How to make budgeting as painless as possible

Budgeting is a pain. But what’s more painful is a bill you can’t easily pay, debt that costs a fortune or not having enough money to retire.

Fortunately, you can have a useful, working budget without watching every penny. Automation, technology and a few simple guidelines can keep you on track. In my latest for the Associated Press, finding the budget plan that best suits your needs.

Tuesday’s need-to-know money news

Today’s top story: Jump start your credit by developing two essential habits. Also in the news: Four questions to ask before buying homeowners insurance, how to handle vehicle repossession, and how much a DUI can cost you.

Jump-Start Your Credit: Develop 2 Essential Habits
These two habits matter most.

Buying Homeowners Insurance? Ask These 4 Questions First
Asking these questions can help you get the coverage you need at a price you can afford.

How to Handle Vehicle Repossession
Navigating a difficult time.

How Much a DUI Can Cost You
It’s simply not worth it.

Monday’s need-to-know money news

Today’s top story: 4 financial experts who could steer you wrong. Also in the news: Treating investing like a subscription, 7 credit card perks to prioritize in 2021, and Disney cancels its annual Passport Program.

4 Financial ‘Experts’ Who Could Steer You Wrong
Be cautious about taking advice from sources who care more about their profits than your financial health.

Want to Invest More This Year? Treat It Like a Subscription
A better financial future for just $49.99 a month sounds like a late-night infomercial, but it’s not as crazy as it seems.

7 Credit Card Perks to Prioritize in 2021
Resolve to examine your cards’ features and ensure they’re still getting the job done and saving you money.

Disney Cancels Its Annual Passport Program
Over one million customers impacted.

Q&A: Establish home’s value at spouse’s death

Dear Liz: I think you left one thing off your list of things to do when your spouse dies. If you’re a homeowner, establish the value of the house as of the date of death. The best way would be to have a local Realtor run some comparables for your neighborhood. But even a printout from Zillow would suffice. As you know, a surviving spouse receives a step-up in basis as of the date of death so it’s important to know what the house was worth at that time for when the house is sold down the road. I see many clients at our CPA firm who have to try to figure out many years later what their house was worth when their spouse died.

Answer: Thank you for the excellent suggestion.

In fact, many things were left off last week’s list of things to do when a spouse dies, which is why I directed people to their attorney or accountant for a detailed checklist. I also recommended people consult a fee-only financial planner, since there probably will be decisions that require expert help.

Q&A: Future home sale affects Medicare

Dear Liz: I am 65 and have a very low income but will be selling my home of 25 years soon to downsize. How will the one-time capital gains affect my Medicare payments, which are currently at the minimum? Can I share with the Social Security office that this is a one-time event and that the following years will all have a very low income stream? Will they adjust my payments up one year and back down the next?

Answer: You can exempt up to $250,000 per person of home sale profit from capital gains, so only profit above that amount would be added into your modified adjusted gross income to determine your Medicare premiums. There’s a two-year lag, so if you sell your home this year and report it on the tax return that’s due next year, your premiums will increase the following year (in your case, in 2023).

As noted in a previous column, you can appeal the increase if your income was affected by certain life-changing events including marriage, divorce, death of a spouse, work stoppage or reduction, loss of income-producing property (because of a disaster or other event beyond your control), loss of pension income or an employer settlement payment because of an employer bankruptcy or reorganization. If you don’t qualify to appeal, the increase would only be for one year and your premiums would return to normal afterward.

Another option is to structure the deal so you receive the payout over time, rather than all at once, but consult an accountant or financial planner before proceeding.

Q&A: A house in one state, a spouse in another. What about taxes?

Dear Liz: My husband recently took a dream job in a different state. We are renting a place there, and it is his primary residence. We own our home in the “original” state, where I live and work. We intend to keep our home for another three to four years. How will this impact our taxes? We are married, filing jointly and our income is straightforward W-2. Will we need to file as residents in both states? I know most states will credit taxes already paid on income earned in another state, but which is our “primary” residence? I may base permanently in the new state because I can work remotely. I am confused about filing jointly when each spouse lives in a different state.

Answer: Please talk to an accountant about the best way to handle your returns. In some cases, spouses who live in different states can submit their federal tax returns as “married filing jointly” while filing their respective state returns as “married filing separately.” Other times, there may be tax advantages to filing jointly in one state, or the nonresident spouse will be required to file.

If you are required to submit a return to the nonresident state, your accountant can tell you whether you qualify for credits. Alternatively, there may be a reciprocal tax agreement between states that allows nonresidents to avoid taxes if they follow certain rules.

But you’ll want to be particularly careful if you currently live in a high-tax state with a reputation for aggressive residency audits such as California, New York and Illinois.

A state auditor may decide that your husband’s move is temporary and his income is thus subject to your state’s taxes. It would be up to him to prove otherwise, and that may not be as easy as changing his voter registration. A tax pro can help guide him, and later you, on the best way to establish residency.

Thursday’s need-to-know money news

Today’s top story: 4 financial experts who could steer your wrong. Also in the news; More Americans are saving than ever before, though in unequal amounts, do’s and don’ts for planning your travel on points this year, and how to make debt less costly when you need it in a crisis.

4 Financial ‘Experts’ Who Could Steer You Wrong
Be cautious about taking advice from sources who care more about their profits than your financial health.

More Americans Are Saving Than Ever Before, Though in Unequal Amounts

Ask a Points Nerd: Should I Book Award Travel for 2021?
Here are some do’s and don’ts for planning your travel on points this year.

How to Make Debt Less Costly When You Need It in a Crisis
Americans have taken on more debt as the pandemic brought widespread job and income losses, according to a survey.

4 financial ‘experts’ who could steer you wrong

None of us knows everything we need to know about money, so we may turn to experts for help. But some money professionals who offer advice are not qualified to do so — nor are they required to put our interests ahead of theirs.

In my latest for the Associated Press, be cautious when accepting advice from certain sources.

Wednesday’s need-to-know money news

Today’s top story: How to decide if loyalty to a hotel or airline is worth it in 2021. Also in the news: The timeline remains unclear on extending payment pause to student loan borrowers, how one late student loan payment affects you, and what questions to ask before buying homeowners insurance.

How to Decide If Loyalty to a Hotel or Airline Is Worth It in 2021
In this uncertain year, keep these factors in mind when deciding whether to change your travel loyalty memberships.

Biden Will Extend Payment Pause for Student Loan Borrowers. Yet Timeline Remains Unclear

Buying homeowners insurance? Ask these 4 questions first
Your insurance policy is your safety net in case of a disaster, so you’ll want to ask a few important questions before forking over your premium

How One Late Student Loan Payment Affects You
Find out the truth.