Friday’s need-to-know money news

Today’s top story: What to do if your parents need financial help. Also in the news: Why no new debt is the best holiday gift to your family, AmEx cardholders report account shutdowns, and why you should get a health insurance cost estimate even if you’re not buying coverage.

What to Do If Your Parents Need Financial Help
Balancing your needs with theirs.

The Best Holiday Gift to Your Family? No New Debt
The gift that won’t keep on taking.

AmEx Cardholders Report Account Shutdowns
Self-referrals appear to be the culprit.

Get a Health Insurance Cost Estimate Even If You’re Not Buying Coverage
You could be eligible for a subsidy.

Thursday’s need-to-know money news

Today’s top story: How to beat basic economy airfare at its own game. Also in the news: Employers who chip in on your student loans, the pros and cons of refinancing your student loans, and this rule of thumb about credit card use could be costing you.

How to Beat Basic Economy at Its Own Game
A Points Nerd explains how.

These employers chip in on your student loans
How different companies assist their employees.

Is it worth it to refinance your student loans?
The pros and cons.

This rule of thumb about credit card use could be costing you
Credit utilization is a major credit score factor.

Wednesday’s need-to-know money news

Today’s top story: 6 great all-inclusive trips you can book this winter with points. Also in the news: Black Friday strategies that actually work, how to make the most of your 401(k), and how to set boundaries when your family is bad with money.

6 Great All-Inclusives You Can Book This Winter With Points
Get out of the cold.

Shoppers Share Black Friday Strategies That Actually Work
Hit the sales with a plan.

How to make the most of your 401(k)
Mistakes to avoid.

How to Set Boundaries When Your Family Is Bad With Money
Putting yourself first.

What to do if your parents need financial help

Most parents in the U.S. provide some sort of financial support to their adult children, multiple surveys have found. But often, financial aid goes the other way.

A 2015 survey by TD Ameritrade found 13% of American adults provided financial support to a parent. Millennials were far more likely than older generations to report they were helping their folks. Of people born between 1981 and 1996, 19% helped support their parents, compared with 13% of Gen Xers (1965 to 1980) and 8% of baby boomers (1946 to 1964).

Sometimes the money is provided happily, or at least without resentment, by those following cultural norms or personal conviction that they owe it to their parents. Other times, financial aid to parents is a source of tension — between parent and adult child, among siblings and between partners.

In my latest for the Associated Press, how to balance your finances while helping your parents.

Tuesday’s need-to-know money news

Today’s top story: Time your credit card application this bonus-friendly season. Also in the news: Debt and housing costs are making it harder to save for retirement, a 2019 holiday shopping report, and how to spend your extra FSA money.

Time Your Credit Card Application This Bonus-Friendly Season
‘Tis the season for bonuses.

Debt, Housing Costs Make It Harder to Save for Retirement, Americans Say
An uncertain future.

2019 Holiday Shopping Report
Will a looming recession curb holiday shopping?

How to Spend Your Extra FSA Money
Don’t leave money on the table.

Q&A: How to protect a child’s education savings from greedy adults

Dear Liz: I understand that money for children’s college education can be put in a bank account with a parent as the trustee under the theory (I suppose) that the child might make bad decisions. In my case, money that I had worked hard for was put into a custodial account and then used by my parents for “necessary” household expenses. My family was not impoverished. This was a dreadful memory for years, and I’m not the only one. Social Security money for a relative, a child, was lost in a divorce. In another case, money was given to a parent for education, but was used in a failed real estate deal, with the children never realizing the money was meant for them. How can money be invested for a child’s education without it being available to an adult for “necessities”?

Answer: When parents take money that belongs to their children, they may not think of it as stealing. But that’s exactly what it is, legally and, of course, morally. There are clear rules for custodial accounts and trusts that should prevent such self-dealing, but often the child’s only recourse would be to sue the parents. That could make for some awkward Thanksgiving dinners.

There wasn’t much you could have done as a child to prevent the theft. But if you ever want to give money to another child, think carefully about the integrity and ability of the person you’re putting in charge of the money.

First pay attention to how they handle their own money. Someone who’s deeply in debt or living paycheck to paycheck may not have the skills to be a good steward.

Then ask yourself, “Could I see this person taking the money if they were really hard up for cash or could otherwise justify it to themselves?”

Then pay attention to your gut reaction. If you believe the person has integrity, that doesn’t mean something bad can’t happen, but you’ve certainly reduced the odds. If you have questions, or you don’t know the person well, you may have other options.

For college expenses, you can open a 529 college savings plan, name the child as the beneficiary and continue controlling the account yourself until the money is paid out for college.

This approach can have potentially large financial aid implications if you’re not the parent, so you may need to delay distributions until after the child files his or her last financial aid form. Sites such as SavingForCollege.com have more information about how these plans interact with financial aid.

A 529 plan probably will be the best option in most situations. Otherwise, you can consult a lawyer about setting up a trust and naming a trustee other than the parents. Trust distributions also can affect financial aid, so you may need to time those carefully.

Q&A: Working past 70

Dear Liz: If I continue to work after 70, will Social Security taxes still be deducted from my check? I understand my benefits will cap out at 70, so why would I need to still pay into the fund?

Answer: Because Social Security is insurance, not a bank account.

And it may not be true that your benefit maxes out at 70, if you continue to work. It’s true that delayed retirement credits no longer increase your benefit if you delay starting Social Security past age 70. But as long as you continue working, you’re potentially growing your benefit.

Your Social Security check is based on your 35 highest-earning years, adjusted for inflation. If you make more in a current year than you made in one of those previous highest-earning years, the current year will be substituted for the earlier one. That in turn can increase your benefit. This can happen at any age, including after you start benefits.

You might not see much increase, of course, or any increase at all if you’ve earned a high income for a long time. If you exceeded the maximum income limits subject to Social Security taxation every year for 35 years, your benefit wouldn’t increase with additional work. (In 2019, for example, the maximum income limit is $132,900; you don’t pay Social Security tax on earnings above that level, although you continue to pay Medicare tax.)

On the other hand, your benefits won’t be stopped once you collect as much from the system as you paid in. You will continue receiving benefits for as long as you live, even if that amount far exceeds what you’ve paid in taxes. That’s insurance worth paying for.

Friday’s need-to-know money news

Today’s top story: 5 ways to take command of military discounts. Also in the news: The best credit cards to use when buying airfare, Black Friday strategies that actually work, and how to spend your retirement savings without triggering a tax penalty.

5 Ways to Take Command of Military Discounts
Thank you for your service.

Buying Airfare? Use These Cards to Maximize Your Points
Getting the most for your purchase.

Shoppers Share Black Friday Strategies That Actually Work
Tackling your holiday shopping.

How to spend your retirement savings without triggering a tax penalty
Draw down your money at the right time.

Thursday’s need-to-know money news

Today’s top story: Speedier payment systems could curb your costs. Also in the news: Black Friday vs. Prime Day: How they stack up, 5 signs an online loan is a debt trap, and everything you need to know about your 2020 taxes.

Speedier Payment Systems Could Curb Your Costs
Real-time payments could save Americans billions.

Black Friday vs. Prime Day: How They Stack Up
71% of Americans plan to shop on Black Friday.

5 Signs an Online Loan Is a Debt Trap
Look for the warning signs.

Here’s everything you need to know about your 2020 taxes
There’s a new tax code.

Wednesday’s need-to-know money news

Today’s top story: 5 signs an online loan is a debt trap. Also in the news: 6 surprising sales to shop on Black Friday, secrets of a Black Friday shopper, and 5 common financial fears and how to conquer them.

5 Signs an Online Loan Is a Debt Trap
Things to look out for.

6 Surprising Sales to Shop on Black Friday
Virtually everything is on sale.

Secrets of a Black Friday Shopper
Get in on the action.

5 common financial fears and how to conquer them
Ignorance isn’t bliss.