Ask Liz Weston

Get smart with your money

Liz Weston

Wednesday’s need-to-know money news

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download (1)Today’s top story: Knowing when you’ve been hit with a higher interest rate on your credit cards. Also in the news: Tips for an easier tax season, why your spending habits are killing your budget, and how you’re gambling with your money and don’t even know it.

How to Tell If You’ve Been Hit With a Higher Interest Rate on a New Credit Card
Introducing the Risk-Based Pricing Rule.

4 Steps to a Smoother Tax Season
It doesn’t have to be painful.

Examine Your Spending Habits Instead of Creating Categorized Budgets
Your habits could be dismantling your budget.

5 Things to Do Now to Avoid Freaking Out Over Taxes in April
Make your life a little easier.

5 Ways You’re Gambling With Your Money
And may not even know it.

Tuesday’s need-to-know money news

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Zemanta Related Posts ThumbnailToday’s top story: How best to protect yourself when shopping online. Also in the news: Retirement resolutions for the new year, how to stay disciplined with your money, and how your credit card could boost your retirement savings.

Which is Safer? Paypal Or A Credit Card
With cyber attacks on the rise, which payment method is safer?

5 Retirement Resolutions For 2015
How to keep your retirement plans on track.

4 Ways to Stay Disciplined With Your Money
Tips to help you stay the course.

How to Build Your Retirement Savings Using a Credit Card
Your credit card rewards could help fund your retirement.

How to Reduce Your 2014 Tax Bill By Over $1,000
Contributing to your IRA could boost your refund.

Monday’s need-to-know money news

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Life InsuranceToday’s top story: Life insurance benefits you may not know about. Also in the news: The upside of waiting to take Social Security, how to have tough financial conversations, and ten ways you might sabotage your new year’s resolutions.

3 Life Insurance Benefits You Did Not Know About
Alternatives to using life insurance as a financial planning tool.

Getting Paid To Wait: Increase Your Social Security Benefit
Taking Social Security later could significantly increase your benefits.

How to Have Hard Financial Conversations With Those Close to You
Tackling the tough subjects.

10 Ways You Might Sabotage Your 2015 Financial Resolutions
Stay strong!

What You Should Know Before Paying Off Old Debt
When paying off old debt is the right move.

Q&A: Battling over mother’s estate

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Dear Liz: Our mom did a wonderful job of preparing her estate, but she made a mistake in that she started giving away her real estate holdings to her two children a few months before her untimely death. She died before she had the chance to equalize these transactions. As her son and executor, I equalized the real estate after her death. My sister is now protesting this because she said “legally” what was given away before death is not part of the estate, but I say that our mom would have wanted this equalized because she was very firm in her belief that her assets be divided equally. What’s your experience?

Answer: You just provided an excellent example of why it can be problematic to have an executor who has a personal stake in how an estate is settled.

You wouldn’t be the first executor to decide that what Mom really wanted was for you to reap a larger benefit than your sibling, despite the explicit terms of a will or trust. Even if the estate documents gave you some discretion, you should have consulted an estate-planning attorney before deciding to help yourself to a bigger portion of your mother’s assets.

This is more than an ethical issue. Executors have a legal responsibility known as a fiduciary duty to the estate and all its beneficiaries. Basically, that means acting with the utmost integrity and putting the interests of the estate and beneficiaries ahead of your own.

Your sister may be able to file a lawsuit against you or ask a court to remove you as executor. You shouldn’t let it come to that. Talk to an attorney now about the best way to resolve this situation amicably.

Q&A: Social Security disability insurance and survivor benefits

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Dear Liz: My first wife died six years ago at age 60. I was 52 and we had been married 27 years. My wife was on Social Security disability for 15 years before her death. My only dealing with Social Security after her death was to cancel her payments. I received no benefits of any kind. I am now remarried. Were there any Social Security benefits that I failed to request? Is there any effect on my future retirement?

Answer: You may have been eligible for a one-time payment of $255, but that’s likely all.

We’ll assume your wife was receiving Social Security Disability Insurance payments, which are disability checks paid to workers who have enough work credits in the Social Security system. SSDI is different from Supplemental Security Income, or SSI, a need-based federal program for low-income individuals who are disabled, blind or over the age of 65. Survivor benefits aren’t available under SSI, but they are under SSDI.

The rules for SSDI survivor benefits are similar to those under regular Social Security. Survivor benefits typically are available starting at age 60. Survivors who are disabled can begin receiving the benefits starting at 50, and survivors at any age can qualify if they’re caring for the deceased person’s child who is under 16. When you remarry before age 60, you can’t claim survivor benefits based on your first wife’s Social Security record unless the subsequent marriage ends in death or divorce.

Q&A: Renovations with high returns

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Dear Liz: What renovation projects reap the most return when selling? Replacing windows and carpeting is what I had in mind.

Answer: Remodeling magazine’s latest Cost vs. Value report puts window replacement near the top of renovation projects that pay off, but none of the projects the survey tracked recouped more than they cost.

In 2014, a homeowner could expect to recoup about 79% of the cost of window replacements, assuming the home was sold soon after the improvement. Major kitchen remodels offered a 74% return on a mid-range project that cost about $55,000, or 64% of a high-end project that cost about $110,000. The amount you can expect to recoup usually declines over time as the improvements start to get dated or suffer wear and tear.

The survey doesn’t track projects that are typically considered more maintenance than improvement, such as replacing carpeting or painting. Those projects may, however, get a home sold faster if done just before the house is put up for sale.