Get smart with your money
Today’s top story: What’s love got to do with a Roth IRA? Also in the news: Are you ready for a joint bank account, why America needs black-owned banks, and 3 health insurance tax benefits you can get in 2017.
What’s Love Got to Do With a Roth IRA?
Saving for the golden years.
Two Hearts, One Bank Account: Are You Ready?
Ready to take the big step?
Why America Needs Black-Owned Banks
Honoring history.
3 health insurance tax benefits you can get in 2017
Maximizing your savings.
Today’s top story: NerdWallet’s best bank accounts and credit unions of 2017. Also in the news: Tips for investing in your 30s, using apps to save money without thinking, and the five biggest tax breaks for the self-employed.
NerdWallet’s Best Bank Accounts and Credit Unions of 2017
Where you should do business.
5 Tips for Investing in Your 30s
Taking the long view.
Want to Save Money Without Thinking? Try These Apps
You won’t even notice.
5 biggest tax breaks for the self-employed
How to keep more of your money.
People who spend too much outnumber, by far, those who spend too little. But the methods that therapists and financial planners use to help “underspenders” can guide the rest of us about when it’s OK to splurge and when we should resist.
Chronic underspenders can be so terrified about running out of money that they put off health care, ignore needed home repairs or descend into hoarding, says financial planner Rick Kahler of Rapid City, South Dakota. Framing certain expenditures as an investment and creating a plan that helps them see how much money they can spend without causing financial ruin can ease their distress, he says.
“‘Spend’ is not a good word to a frugal person,” says Kahler, author of “Conscious Finance: Uncover Your Hidden Money Beliefs and Transform the Role of Money in Your Life.” ”It connotes waste.”
In my latest for the Associated Press, why it’s important to spend money on yourself, even when you’re trying to save.
Dear Liz: I worked for a company during the late 1990s. When I left, I had a 401(k) worth approximately $10,000. I recently found an old 401(k) statement and called the plan administrator. I was told my company’s accounts had been transferred to another plan administrator in 2008. I called the new administrator and was told they also could not find my 401(k) using my Social Security number. How do I proceed? What are my options?
Answer: Get ready to make a lot more phone calls.
There’s no central repository for missing 401(k) funds — at least not yet. The Pension Benefit Guaranty Corp., which safeguards traditional pensions, has proposed rules that would allow it to hold orphaned 401(k) money from plans that have closed. That wouldn’t start until 2018. Another proposal, by Sen. Elizabeth Warren (D-Mass.) and Sen. Steve Daines (R-Mont.), would direct the IRS to set up an online database so workers could find pension and 401(k) benefits from open or closed plans, but Congress has yet to take action on that.
If your balance was less than $5,000 — which is possible, given the big market drop in 2008-2009 — your employer could have approved a forced IRA transfer and the money could be sitting with a financial services firm that accepts small accounts. If the plan was closed and your employer couldn’t find you, the money could have been transferred to an IRA, a bank account or a state escheat office. You can check state escheat offices at Unclaimed.org, but searching for an IRA or bank account may require help.
If your employer still exists, call to find out if anyone knows what happened to your money. If the company is out of business, you may be able to get free help tracking down your money from the U.S. Department of Labor (at askebsa.dol.gov or (866) 444-3272) or from the Pension Rights Center, a nonprofit pension counseling center (pensionrights.org/find-help). Another place to check is the National Registry of Unclaimed Retirement Benefits, a subsidiary of a private company, called PenChecks, that processes retirement checks, at www.unclaimedretirementbenefits.com.
One more wrinkle: Your employer or a plan administrator could insist you cashed in your account at some point. You may be able to prove otherwise if you’ve kept old tax returns, since those typically would show any distributions.
Your experience shows why it’s important not to lose track of old retirement accounts. Your current employer may allow you to transfer old accounts into its plan, or you can roll the money into an IRA. Either way, it’s much better to keep on top of your retirement money than to try to find it years later.
Dear Liz: I use auto-pay for bills in both my business and my personal life. What can we, as consumers, do to protect ourselves and our estates from companies taking advantage of the auto-pay when we die? Do our heirs have to cancel right away? They will have so many other things to deal with in those first months after a loved one dies.
Answer: You may have read about Pia Farrenkopf, the Michigan woman whose mortgage and utility bills continued on auto payment for five years after she died. It was only after her account ran dry, the bank foreclosed on her home and a contractor was sent to fix a hole in the roof that her mummified corpse was found in a Jeep parked in her garage.
The companies receiving the payments weren’t taking advantage of her — they had no way of knowing she was dead. And not all bills will or should stop getting paid at the moment of someone’s death. Even if Farrenkopf’s death had been noticed right away, the person settling her estate likely would have kept the utilities paid and the insurance in force until the home was sold.
If you’re concerned about auto-payments continuing for too long, make sure that your executor or successor trustee has access to your bank accounts. Your bank has a power of attorney form that you can use to grant instant access, or you can provide your login credentials, either now or in the estate planning documents this person will receive at your death.
Today’s top story: Creating a budget isn’t as scary as it sounds. Also in the news: How filing separately could give some couples a lower tax bill, the history of the credit card, and how to protect your family business during a divorce.
Creating a Budget Isn’t as Scary as It Sounds
Taking the first step.
Filing Separately Could Give Some Couples a Lower Tax Bill
When it makes sense to file separately.
The History of the Credit Card
The origins of our favorite plastic.
How to protect your family business during a divorce
Protecting a legacy.