Liz Weston

Tuesday’s need-to-know money news

February 15, 2022 By Liz Weston

Today’s top story: How supply chain issues are crushing hotels – and your stay. In other news: As mortgage rates hit 4%, buyers can still boost their chances, the perks of selling your home could outweigh the challenges of buying, and everything you should do before interest rates go up.

How Supply Chain Issues Are Crushing Hotels — and Your Stay
Hotels aren’t immune to the impact of supply chain disruptions.

As Mortgage Rates Hit 4%, Buyers Can Still Boost Their Chances
With the 30-year mortgage rising fast, buyers may need updated preapprovals and revised expectations.

Perks of Selling Your Home Could Outweigh Challenges of Buying
While it’s a notoriously tough time to buy a home, the incentives to sell the one you’re in could be too good to pass up.

Everything You Should Do Before Interest Rates Go Up
Borrowing money is about to become more expensive.

Monday’s need-to-know money news

February 14, 2022 By Liz Weston

Today’s top story: Why you should consider a smaller car insurer. Also in the news: A new episode of the Smart Money podcast on credit union perks and getting into the housing market, tax tips for small business owners, and paying off your starter home vs saving cash for the next one.

Why You Should Consider a Smaller Car Insurer
Bigger isn’t always better when it comes to car insurers. Smaller insurers are worth a look, too.

Smart Money Podcast: Credit Union Perks, and Getting Into the Housing Market
When members rather than stockholders own a financial institution, results are often lower rates on loans.

7 Ways Small-Business Owners Can Save on Taxes in 2022
Seven things entrepreneurs and independent workers can do to lower their tax bills and their anxiety this filing season and in the year ahead.

Should You Pay Off Your Starter Home, or Save Cash for the Next One?
The market’s too hot but you’ve already stocked away a down payment—so what’s your best move?

Q&A; An auto dealer keeps checking my credit. Is that a problem?

February 14, 2022 By Liz Weston

Dear Liz: How do I remove inquiries from multiple auto lenders? One of the dealerships pulled my credit at least eight times over a two-day period. I thought this could only be done while the customer is physically at the car lot.

Answer: Dealerships aren’t supposed to check your credit without your permission, and they can’t check your credit if you don’t give them your personal information, including your Social Security number. Some dealers use deceptive methods to get your personal information, such as claiming they need your Social Security number for you to take a test drive. (They don’t.)

If you did give permission, though, there’s not a lot you can do about multiple inquiries. Dealerships can, and will, check with multiple lenders to see what rates and terms they’ll offer you. If your credit isn’t great, multiple inquiries may be necessary to find you a loan.

The good news is that multiple auto loan inquiries in a two-day span won’t hurt your credit that much or for that long. Most credit scoring formulas don’t count each auto loan inquiry separately, but instead aggregate such inquiries together and count them as one. The ding against your credit scores is typically small and lasts only a few months.

Ideally, though, you wouldn’t continue to do business with a dealership that wasn’t crystal clear about why it needed your personal information and how it was going to be used. Also, consider applying for a car loan from a local credit union before you step onto a car lot. Credit unions are member-owned and tend to have good rates and terms, without the runarounds and add-ons that are so prevalent at car dealerships.

Q&A: DIY estate planning is unwise

February 14, 2022 By Liz Weston

Dear Liz: Please tell us about some estate planning tools that many might be able to use for themselves without incurring attorney fees and probate costs, such as naming payment-on-death beneficiaries at financial institutions and using real estate deeds with transfer-on-death provisions.

Answer: There are a number of ways that people can avoid probate, which is the court-supervised process of settling someone’s estate. Bank, financial and retirement accounts can pass to named beneficiaries outside probate, as can life insurance. Property owned in joint tenancy also avoids probate. Some states have transfer-on-death options for real estate and for vehicles.

The fact that you can avoid probate with these methods, however, doesn’t necessarily mean that you should.

Do-it-yourself estate planning can create a mess for your heirs that could incur far more in legal fees than you would have spent getting expert, personalized advice in the first place. A good rule of thumb: If you can afford to hire an estate planning attorney, you probably should.

Also, you shouldn’t automatically assume that probate is worth avoiding.

Probate is often lengthy and expensive in California and Florida, but may be far less cumbersome elsewhere. In addition, small estates typically qualify for simplified probate that’s faster and cheaper.

Probate also has some advantages, including limiting the time creditors have to make claims against your estate. You also might prefer a court’s supervision if you have contentious heirs or you’re concerned that your executor might not carry out your wishes.