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Liz Weston

Q&A: Good news about your coronavirus stimulus money: It doesn’t count as income or an asset

June 1, 2020 By Liz Weston

Dear Liz: I have a question about a recent answer you gave. The question was whether stimulus payments count as income for people who get Medicaid or Supplemental Security Income. Your — correct — answer was that they don’t, of course, but you seemed to gloss over the fact that even though this payment was not “income,” it would still count as an asset in the recipient’s bank account. The recipient’s assets are limited to $2,000 by the Medicaid program.

Answer: The relief payments do not count as income or as an asset. The money is excluded from the recipient’s resources for 12 months.

Filed Under: Coronavirus, Q&A Tagged With: coronavirus relief payments, q&a

Friday’s need-to-know money news

May 29, 2020 By Liz Weston

Today’s top story: Why good credit matters even if you don’t plan to borrow. Also in the news: An expert weighs in on how to travel safely, 4 options if you’re undecided about college this fall, and how to amend a tax return online.

Why Good Credit Matters — Even if You Don’t Plan to Borrow
Good credit provides a safety net in a crisis, and it can reduce bills and make you look better on applications.

Ask an Expert: Is Any Travel Safe?
Can we safely beat our cabin fever?

Still Undecided About College This Fall? Know These 4 Options
Things will look a bit different.

How to Amend a Tax Return Online
You no longer need to mail in corrections.

Filed Under: Liz's Blog Tagged With: 1040X, college, Credit Score, tax returns, tips, travel

Thursday’s need-to-know money news

May 28, 2020 By Liz Weston

Today’s top story: Find free, solid money advice in uncertain times. Also in the news: 9 budget-friendly ideas for a staycation, how unpaid debt is handled when a person dies, and what to do if you get a letter about unemployment benefits you never requested.

Find Free, Solid Money Advice in Uncertain Times
Many organizations are offering free virtual consultations to help stressed consumers navigate financial decisions.

9 Budget-Friendly Ideas for a Memorable Staycation
Travel plans are changing.

Here’s how unpaid debt is handled when a person dies
Who’s responsible?

What to Do if You Get a Letter About Unemployment Benefits You Never Requested
Don’t throw it out.

Filed Under: Liz's Blog Tagged With: free money advice, staycation tips, unemployment benefits, unpaid debt

Find free, solid money advice in uncertain times

May 27, 2020 By Liz Weston

If you have money questions — and who among us doesn’t right now? — there are plenty of people willing to offer advice: friends, relatives and random strangers on the internet.

Finding someone who knows what they’re talking about, and who isn’t trying to take advantage of you, can be tougher. Fortunately, several groups of credentialed, trustworthy financial advisers are stepping up to offer free help.

In my latest for the Associated Press, how to find the solid advice you need.

Filed Under: Liz's Blog Tagged With: Coronavirus, financial advice, free financial advice

Tuesday’s need-to-know money news

May 26, 2020 By Liz Weston

Today’s top story: Credit score drop? How to diagnose why and what to do next. Also in the news: A new episode of the SmartMoney podcast on the safety of Bitcoin, what to do if you’re struggling with IRS delays, and what to do about your FSA contributions if your child care is closed.

Credit Score Drop? How to Diagnose Why, and What to Do Next
Time to check your credit report.

SmartMoney Podcast: ‘Is Bitcoin Safe?’
A look at the popular cryptocurrency.

Try these workarounds if you’re struggling with IRS delays
Tips on how to get help.

What to Do About Your FSA Contributions if Your Child Care Is Closed
The IRS has made some changes.

Filed Under: Liz's Blog Tagged With: BItcoin, child care, credit report, Credit Score, cryptocurrency, FSA, IRS, IRS delays, tips

Q&A: When a Roth IRA makes sense

May 26, 2020 By Liz Weston

Dear Liz: I have some money saved in a brokerage account, over and above my maximum 401(k) contribution. I just turned 60. Is it advantageous to move that money into a Roth IRA or should I keep it in the brokerage account?

Answer: If you suspect you’ll need this money within five years, then you probably should leave it in the brokerage account (and move it to cash, since money needed within the next few years should not be in the stock market). Otherwise, there’s little downside to moving some of the money to a Roth IRA, if you can, and plenty of upside.

Having money in a Roth gives you “tax diversification,” or a potentially tax-free bucket of money to draw from or leave alone as you see fit. That’s in contrast to 401(k)s, regular IRAs and other retirement plans, which typically require withdrawals to begin at age 72.

You can always withdraw an amount equal to your contributions without paying taxes or penalties. Once the account is at least 5 years old and you’re over 59½, whichever comes later, you also can withdraw any earnings without tax or penalty.

You can contribute up to $7,000 to a Roth this year, assuming you have earned income of at least that amount and your modified adjusted gross income is less than $124,000 if you’re single or $196,000 if you’re married filing jointly. (The contribution limit is $6,000 for people under 50.) If your income is above those limits, your ability to contribute to a Roth starts to phase out. The ability to contribute directly to a Roth ends when your modified adjusted gross income is over $139,000 for singles and $206,000 for married couples.

Filed Under: Q&A, Retirement Tagged With: brokerage, q&a, retirement savings, Roth IRA

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