Ask Liz Weston

Get smart with your money

Liz Weston

Wednesday’s need-to-know money news

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Today’s top story: 5 steps to change homeowners insurance paid through escrow. Also in the news: Getting by on the average retirement income, TSA-Approved ways to cut the airport screening lines, and how to tell if your company’s 401(k) plan is any good.

5 Steps to Change Homeowners Insurance Paid Through Escrow
Seamless transition.

Could You Get By On the Average Retirement Income?
Will you have enough?

TSA-Approved Ways to Cut the Airport Screening Line
You can leave your shoes on.

How to Tell if Your Company’s 401(k) Plan Is Any Good
Is it worth contributing to?

Tuesday’s need-to-know money news

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Today’s top story: Bartenders spill secrets for keeping your tab in check. Also in the news: How a remodeling project changes your property tax bill, tips for back-to-school shopping, and how to use your bank’s automatic transfer tools to make budgeting easy.

Bartenders Spill Secrets for Keeping Your Tab in Check
Avoiding a financial hangover.

How a Remodeling Project Changes Your Property Tax Bill
That new bathroom just increased your home’s value.

Cross Items Off Your Back-to-School List With These Tips
Almost time to go back to school.

How to Use Your Bank’s Automatic Transfer Tools to Make Budgeting Easy
Automating your banking can make saving money easier.

Why traditional credit scores still matter

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Researchers and startups say all kinds of weird data can predict your creditworthiness. What kind of smartphone you have, who your friends are and how you answer survey questions may foretell how likely you are to pay back a loan.

Don’t expect this alternative data to displace the three-digit number most lenders use, however. Credit scores still matter — a lot.

Lenders use credit scores to decide whether you get loans and credit cards, plus the rates you pay. Scores are also used to determine which apartments you can rent, which cell phone plans you can get and, in most states, how much you pay for auto and homeowners insurance.

In my latest for the Associated Press, why traditional, three-digit credit scores still matter.

Monday’s need-to-know money news

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Today’s top story: How to protect your money from criminals. Also in the news: How to fight about money and stay madly in love, how to have “the talk” about finances with your parents, and deciding to reroute some of your retirement savings to pay for a house.

Banking Has Changed, but Criminals Haven’t — Here’s How to Protect Your Money
Staying on guard.

How to Fight About Money and Stay Madly in Love
Don’t let money get in the way.

Have ‘The Talk’ About Finances With Your Parents Already
Having the tough conversations.

Should You Reroute Some of Your Retirement Savings to Pay for a House?
One of the biggest decisions you’ll ever make.

Q&A: Mother-daughter drama and the financial ties that bind

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Dear Liz: My mother is turning 92 this month. Due to a dispute, my mother amended her will last year and stated that my inheritance had to be used for a certain purpose.

My brother sent me the amendment and told me he will enforce my mother’s wishes. He also told me that I had to send a letter to him after my mother dies if I do not want anything from her trust. Is this accurate?

I want to put it in writing before my mother dies that I do not want a penny from her trust. I want to be completely estranged from my family and their control. Do I need a lawyer to do this, and do I have to wait until her death to put this in writing?

Answer: Consider showing the email to an experienced estate planning attorney to find out how much actual control your mother will have from beyond the grave. There may be workarounds that you (and your mother) haven’t considered.

If you decide you don’t want the money after her death, you can “disclaim” it in the letter your brother described. While it may seem more satisfying to make the point while your mother is still alive, you cannot force her to disinherit you any more than she can force you to take the money if you don’t want it.

Q&A: The effects of working after taking Social Security

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Dear Liz: I didn’t pay much into Social Security and started drawing it at age 62. As a result my check wasn’t very much. If I start working now, will it increase my monthly benefit over the years?

Answer: Yes, but the effect depends on a lot of factors.

Social Security determines your benefit using your 35 highest-earning years. If you go back to work and earn more than you made in one of those previous years, your benefits will be automatically adjusted.

If you haven’t reached your full retirement age, however, working can temporarily decrease your checks. Full retirement age is currently 66. If you’re younger than full retirement age, Social Security will deduct $1 from your benefits for each $2 you earn above $17,040 in 2018.

That money isn’t gone for good. It will be added back into your benefit once you reach full retirement age.

There’s another way to boost your checks once you reach full retirement age, and that’s to suspend your benefit. Suspending your checks allows your benefit to earn delayed retirement credits. That will increase your benefit by 8% each year between your full retirement age and age 70, when your benefit maxes out. If you can afford to forgo checks for a while, suspending your benefit probably will give you the biggest increase.