Go figure – it’s Fathers’ Day

June 14, 2019

Happy Father’s Day to all the dads, fathers, papas, grandfathers and father-figures in our lives. The world would not be the same without them. Since 1910, the USA has honored the third Sunday in June to remember the “contribution that fathers and father figures make to the lives of their children.” As other countries have adopted this custom, some in August, September or December, the celebrations usually involve gifts and food.

Although the role of the father as being the breadwinner in the family, the one with the full-time job, or the one that leaves to go to work every day is not always the norm – there is still popular public opinion that this is the case. According to the Pew Research Center, in the United States only a quarter of families with children under the age of 18 have a father that is the breadwinner. That means that men are connecting with children in a different way to the 1970s, when almost half of these couples (47%) were in families where only the dad worked.

Do we have more money now than in our father’s generation? Where do my resources go? Father’s Day, like so many events, can often be a time of reflection. Does our habitual nature with finances stem from our father-figures’ habits?

• Spending. Work hard, play hard. For so many of us, the money is a means to an end. After the bills are paid – what makes us and our families happy? Is it the latest gadget or home improvement, the presents for the children, or the holidays and excursions? If your father-figure showed love and excitement spending on summer vacations with ice-creams and beach time, it is likely you will be doing a similar thing.
• Saving. Keep the money for a rainy-day – or for large events. The price of college, weddings, first-homes are skyrocketing. It’s not just a phrase about the good ol’ days – the dollar used to go much further. According to the CPI Calculator in 1910 $100 would buy the same as $2500 would buy today. With unemployment rates high and pay for jobs low, it is pretty difficult to cross the threshold from poverty to middle class, from middle class to rich, and rich to wealthy. Foregoing the restaurants and the international travel for 529 plans and down-payments on homes are options we can provide our children.
• Scaling Back. As we are encouraged to look ahead and plan for retirement and downsize – do we need the large home, the extra vehicles, the tax-rate for the school districts that we are currently in? Some current trends involve the KonMari method in finding joy in our possessions and discarding or rehousing others. Are our loved ones living in different states or countries that we don’t get to connect with because of distance. Perhaps owning a smaller property or finding a space in a favorite location is the best use of the resources now.

As you place yourself in the category that best fits you – and there is no-one that stays stagnant in their mindset – each requires monitoring of your assets to fit the lifestyle that you desire. This takes time and work, but there are tools out there that are designed to simplify your life, and give your family the visibility into your world.

As you reach to contact the father-figures in your world, or are considering a Father’s Day gift to remember – InsureYouKnow.org product offerings may be your answer. It’s a safe place to store all the information in case you need to access it remotely – or from the comforts of your own home. Taking stock of your memories and your current resources with an annual plan.

Summer Speculations

June 1, 2019

Can you believe it’s already June. Where did the first 5 months of the year go? And have you already planned out your summer, or has that been on the to-do list for the umpteenth week? Whether you have every weekend from Memorial Day to Labor Day booked, or you are planning to enjoy the lazy, lengthy days of summer – your money is usually a factor.

Summer vacations can be crowded and expensive. Nearly 100 million Americans are planning to take a family vacation in 2019, per AAA data, and 38 million traveled during Memorial Weekend alone. The tourism industry is ramping up pricing on accommodation, transportation, food, gas and admission fees to attractions. In 2016, 58 percent of Americans spent over $1,300 on travel. This statistic is increasing 30% year over year

How to reduce Summer spending – and increase your Personal savings.

• Travel. Where do you want to go? Do you have a destination in mind? There are peak destinations that four out of 10 U.S. adults are hoping to travel to in the summer. However there are hundreds of articles with off-peak options. Try to book your flights 45 days in advance, and avoid the US National Holidays and early-August if possible. Schools in the US and Europe are off for summer break and families are taking advantage of the last few weeks off.
• Accommodations You probably already have experience with hotel chains or bed and breakfast establishments, but now there are many other options. The explosion of home rentals priding themselves as vacation experiences, are catering to all types of travelers. There are 1 night rentals to multiple week possibilities. Resorts are also affordable with lodging-only options instead of all-inclusive.
• Attractions and Activities. From amusement parks to museums to waterparks – every location has activities to enjoy. Coupons and online discounts are available for most of the top attractions and there may even be reduced rates for visiting on weekdays vs. weekends. Some banks and credit cards also have affiliations – Museums on Us is an example.
• Time. Can you mentally and physically afford to take the break out of your routine? Your workplace may have vacation policies around when you can use your time-off. Consider if you would like to save some time for DIY at the home or local excursions.

At the end of the day – take the vacation that works for your budget and time circumstances. If you only have a weekend – a staycation may be much more enjoyable than spending multiple hours on planes trains and automobiles to reach your destination for just a few hours. If you have a limited budget – create a list of the must-haves and ignore the advertising, social media and recommendations that you may encounter.

Bon Voyage! or Enjoy your couch! Before you enjoy your summer break, don’t forget to upload all your documents onto InsureYouKnow.org. It’s a safe place to store all the information in case you need to access it remotely – or from the comforts of your own home.

Is Pet Insurance Worth It?

May 23, 2019

Anyone with pets knows that taking care of them isn’t cheap. According to the American Pet Products Association, Americans spent more than $72 billion on their pets in 2018. From food to boarding, there are a lot of expenses associated with owning a pet.

One of the biggest expenses is veterinary care. A trip to the veterinarian isn’t cheap, nor should it be. Veterinarians have spent years in school learning how to care for and treat animals. They’re doctors for animals, and when Rover swallows something he shouldn’t or Tigger suddenly stops eating, their expertise is worth every penny.

But when money is tight, an unexpected trip to the vet can break your budget for the month. And that’s if you can afford to pay for care at all; some pet owners feel they have to put their beloved family member down because they can’t afford expensive medical treatments.

There is a potential solution: pet insurance. Just like your health insurance helps cover the cost of your medical care, pet insurance can defray some of the expenses associated with veterinary care. And just like you need to understand how your health insurance policy works in order to avoid an unexpected bill, you need to read the fine print on any pet insurance policy before signing on the dotted line.

If you’re trying to decide if pet insurance is the right decision for you, here are a few questions to ask yourself:

• Does your pet have any preexisting conditions? If so, stop right there. If your vet has diagnosed your pet with an ailment or disease already, pet insurance won’t cover any care for it. That may include illnesses or accidents related to the condition.
• How old is your pet? Generally speaking, the older the pet, the higher the premiums. You’ll get the best rates when your pet is still young. Keep in mind that the rate most likely will rise as your pet ages, and it’s not uncommon for people to drop pet insurance after their pet reaches a certain age.
• Is your pet prone to hereditary conditions? Many large dog breeds are known for hereditary conditions, such as hip dysplasia and torn ACLs. Insurers often won’t cover treatment for these conditions even if your pet wasn’t showing any symptoms when you initially bought coverage.
• Can you afford to save up instead? If you can afford it, it might be smarter to have a separate savings account for pet care. If you never need it, great—you can put that money toward paying down debt or a down payment on a house. Just keep in mind that should the worst occur, medical expenses can add up quickly.

Pet insurance is growing in popularity; according to the North American Pet Health Insurance Association, about 1.4 million pets in the U.S. and Canada were covered by a plan in 2014, up from 680,000 pets in 2008. If you’re considering purchasing pet insurance, be sure to explore all your options, including whether you can get it through your employer. Eleven percent of U.S. employers offer pet insurance benefits, according to the Society for Human Resource Management.

If you decide to purchase pet insurance, be sure to upload the policy and any related documents to InsureYouKnow.org. When you need to access them quickly, you’ll be glad they’re in a safe, secure, easy-to-find location.

Buying vs. Leasing a Car

May 7, 2019

When it’s time to get a new car, one of the first decisions you’ll have to make is whether to buy it or lease it. If you aren’t paying cash and have to take out a loan, you’ll have a monthly payment either way. So which option is better?

While many financial experts recommend never leasing a car, there are a few times it does make sense. Here are some reasons you may want to lease a car:

• Lower monthly payments. Generally speaking, the monthly payment on a car lease is much lower than that of a car payment because it is based on a car’s depreciation instead of its purchase price. In addition, you may only have to put a little down, if anything at all.
• Fewer repair costs. Most likely, major repairs will be covered by your warranty. You’ll be responsible for general upkeep, but you won’t have to worry about a huge repair bill destroying your monthly budget.
• Less hassle when it’s time for a change. When you’re ready for a new car, you don’t have to worry about selling your old one. You can simply return the car when your lease expires and pick out a new one.

So why do people buy a car if it costs more and can be more of a hassle? Here are a few reasons:

• True ownership. Your car is yours. You can customize it as much as you like, and no one is going to expect you to keep it in pristine condition—or charge you if it isn’t.
• No mileage limits. When you lease a car, you must stay within your mileage limits or pay a pretty penny for exceeding them. When you buy a car, you can drive it as much and as far as you’d like.
• No monthly payment (eventually). If you have to take out a car loan, at some point you’ll pay it off and your monthly payment will drop to $0. When you lease, you will always have a monthly payment.

Looking at the big picture, leasing a car is actually more expensive in the long run. Not only will you always have a monthly payment, but also you won’t be building up any equity in your car that you can cash in later when you sell it.

But it’s not always about the money. If it’s important to you that you have a new car every few years with the latest technology and safety features, or if you use your car for business purposes and can write off related costs, leasing might be your best bet. Just make sure you run the numbers and take all factors into consideration.

Whether you decide to lease or buy, be sure to store the related documents on InsureYouKnow.org. This includes any loan documentation and/or a copy of your car’s title. It’s vital that you keep all your important financial documents in one place so you and your loved ones don’t have to dig through a mountain of paper whenever they need to be accessed. 

Should You Choose a Bank or a Credit Union?

April 19, 2019

You work hard for your money. When it comes to storing it, you want to know it’s in a safe place. So which is better for your financial needs: a bank or a credit union?

Ultimately, both banks and credit unions offer a number of benefits. Both offer checking accounts, savings accounts, and other financial products, like loans and credit cards. The main difference between them is that banks are for-profit entities while credit unions are nonprofit organizations. This means that banks answer to their shareholders while credit unions answer to their members.

What does that mean for you as a potential customer/member? Here are a few things to consider as you decide between a bank and a credit union:

• Membership requirements. Many credit unions have membership requirements. You may need to live in a certain area, be part of a certain profession, or work for a certain employer. Banks, on the other hand, are open to anyone.
• Interest rates. Credit unions generally offer higher interest rates. This is because they aim to please their members. Banks tend to offer lower interest rates in order to generate more profit.
• Fees. Similarly, credit unions often offer lower fees than banks. According to Bankrate’s 2018 Credit Union Checking Survey, 82% of the nation’s 50 largest credit unions offer free checking, compared to only 38% of banks.
• Convenience. The larger banks seem to have a location in every town; some seem to have a location on every corner. Many credit unions, on the other hand, only have a few locations in a specific region. As more people turn to online and mobile banking, this is less of a consideration than it used to be, but it may still be a factor.
• Customer service. At credit unions, customer service is a top priority. They are known for their personalized attention and fast service. While many banks also offer excellent customer service, especially smaller banks, some customers feel like they are treated as little more than an account number.
• Product availability. Large banks are able to offer a wider variety of financial products and services than credit unions. These include more credit card options (and better rewards programs) and investment services.
• Technology. Thanks to their larger budgets, banks tend to have better online and mobile services. Their services also often integrate more easily with personal finance and budgeting software such as Mint.com or Quicken.

Still can’t decide? Here’s some good news: Whether you choose to deposit your money in a bank or a credit union, your deposits will be insured up to $250,000. Just make sure your bank is a member of the Federal Deposit Insurance Corp. (FDIC) or your credit union belongs to the National Credit Union Administration (NCUA). This will protect you in the unlikely event that your bank or credit union fails.

After you open your new checking or savings account, you’ll want to upload the related documents to InsureYouKnow.org for safekeeping. Don’t forget to let your loved ones know they’re there!

Do Children Need Life Insurance?

April 5, 2019

Getting ready to welcome a baby into the world is an exciting time. You can’t help but think of all the adventures to come and dream of the future that awaits your new son or daughter. You start by planning for your child’s immediate needs, stocking up on diapers, decorating the nursery, and lining up day care if needed, before considering longer-term issues, like setting up a 529 plan to help fund your child’s education.

The last thing you want to think about during this joyous time is purchasing life insurance for your unborn child. You’re eagerly awaiting your baby’s birth, not anticipating his or her death. Nonetheless, it’s worth looking into before you make up your mind.

Here are a few reasons you may want to get life insurance for your child:

• It can serve as a savings vehicle. When you buy a whole life insurance policy (you can’t buy term life insurance for minors), the cash value grows slowly over the years. Your child can surrender the policy later and use the money as he or she wishes.
• It guarantees your child’s insurability. If your child develops a medical condition, you won’t have to worry about whether he or she will have life insurance. In fact, your child will be able to buy additional insurance as an adult if needed regardless of his or her health (check with your individual insurance provider to see if you’ll need to include an additional rider for this benefit).
• It provides peace of mind. Planning a funeral is difficult, and planning one for your own child is especially hard. Life insurance would cover funeral expenses, which can cost thousands of dollars, and perhaps allow you to take some time off work as you grieve.

On the other hand, here are some reasons why life insurance may not be the best idea:

• There are better ways to save. According to Consumer Reports, the average annual rate of return is 1.5 percent for the whole life guaranteed cash value. That doesn’t take into consideration associated fees that eat into the returns. You can easily beat that rate by investing your money elsewhere.
• It probably isn’t needed. Statistically, it’s unlikely your child will die. In addition, the main purpose of life insurance is to replace income or cover debts, and those situations generally don’t apply to your child. You most likely aren’t relying on your child’s income to pay your monthly bills.
• Your child probably can get term life insurance later. Again, statistically speaking, your child should be able to purchase a term life insurance policy as an adult. Term life insurance is more affordable and practical for most people.

Ultimately, purchasing life insurance for your child is a personal decision. If you do decide to get a policy, be sure to store the related documents on InsureYouKnow.org. Should the worst occur, you will want to be able to access the documents quickly and easily so you can focus on healing.

Finding a Great Job in Retirement

March 29, 2019

You’ve made it! After a long, fulfilling career, you’ve closed the office door for the last time and retired. Now you’re ready to relax and enjoy your golden years.

But as they say, the best-laid plans of mice and men often go awry.

Many retirees quickly discover that despite years of faithfully contributing to their retirement plans, they haven’t put away quite as much as they’d hoped. In fact, they may not have enough money coming in each month to meet their financial obligations. Those dreams of traveling the world are replaced with nightmares of dusting off the resume and finding another 9-to-5 job.

If you’re finding yourself in this situation, it’s important to remember that you’re not alone. According to Northwestern Mutual’s 2018 Planning & Progress Study, one in five Americans (21%) have nothing saved for retirement at all, and one in three baby boomers (33%) have between $0 and $25,000 in retirement savings. Four in 10 Americans (40%) expect to work until 70 years old or older.

Nonetheless, the idea of finding another job can be daunting. Instead of looking at it as a disappointment, however, you can look at it as an opportunity. Here are a few ways you can make sure your new job is an amazing job:

• Find a job in a new field. Have you always dreamed of working in a bookstore? Do you think it’d be fun to take tickets at a movie theater? This may be the chance for you to do something that excites you.
• Limit your hours. If you only need to supplement your retirement income, try working part-time. You’ll keep your brain busy and your wallet full but still have the freedom to spend a few hours each day pursuing other interests.
• Turn your hobby into a business. From selling hand-knit baby booties in your own Etsy store to hawking the vegetables you’ve lovingly grown in your garden at the neighborhood farmer’s market, there are a number of ways you can make money off your hobbies. Just be sure to check local regulations first.
• Stay active. It’s important to stay physically active as you age, and your new job could keep you moving. Consider becoming a tour guide or yoga instructor to ensure you stay fit both financially and physically.
• Share your knowledge. Many retirees want to get more involved with their communities, and teaching is a great way to do that. You can inspire today’s youth by becoming a teacher in the local school district or an instructor at a community college.

• Help raise tomorrow’s children. Maybe you have fond memories of watching your children take their first steps. Maybe you never had a child but always enjoyed hearing their joyful laughter. Becoming a child care worker might be the right step for you.

Having a shortfall in your retirement savings isn’t the end of the world. In fact, it can open up a whole new world to you. Be sure to keep track of your retirement accounts and store the related paperwork on InsureYouKnow.org. The peace of mind you’ll have from knowing your information is safe and sound will help you enjoy your retirement—or semi-retirement—more fully.

What to Do With Your Tax Refund

March 8, 2019

It’s that time of year again! While experts agree you should avoid getting a large tax refund (which is essentially an interest-free loan to Uncle Sam), it’s hard not to feel giddy when you know extra money is coming your way. Many people look forward to getting a refund each year and use it as an excuse to splurge on themselves.

Before you buy that new TV, however, it’s important to take a close look at your finances and determine if that’s really the best idea. While putting that money toward a more practical purpose may not be as much fun, it can pay off in the long run.

Here are a few smart ways you can use your tax refund:

• Pay off debt. This is a no-brainer. If you’re carrying around credit card or other high-interest debt, you want to get rid of it as quickly as possible. Before that cash has a chance to get comfortable in your bank account, use it to pay down your debt and lessen some of the anxiety hanging over your head.
• Put it in savings. It never hurts to pad your savings. This could be the year that your hot water heater breaks down or your car decides to bite the dust. Set that money aside in a high-yield savings account so it’s there when you need it.
• Prepay your mortgage. Your home is probably your biggest investment—and your mortgage payment is probably your biggest debt. Putting a little extra toward your mortgage regularly can save you thousands of dollars and shave years off your loan.
• Fund your retirement. You don’t have any debt. You have a fully funded emergency fund. Does that mean you’re free to book that plane ticket to Cancun? Not necessarily. How are your retirement accounts doing? If you’re behind on your retirement savings, it’s not too late to catch up.
• Invest in yourself. It’s easy to let your career get stuck in a rut. Your tax refund can help you make a career change or take your skills to the next level. Use it to enroll in continuing education courses or certification programs and earn that promotion you’ve been waiting for.
• Upgrade your life. Sometimes you simply need to make a major purchase. If you’re a freelance writer and your computer is slow as molasses, you probably need a new one so your business doesn’t suffer. If your energy bill is sky-high and you live in an older house, it might be a good idea to replace your windows. Making smart purchases now can save you a lot of money down the road.

Whatever you do with your extra cash, make sure you keep track of it. The last thing you want to do is slowly spend it on a frozen treat here or a pack of gum there, only to discover it’s gone before you know it. You should regularly monitor your banking statements and other financial documents to ensure you know where your money is going. Don’t forget to store these and all your other important documents on InsureYouKnow.org. It’s part of being a knowledgeable, financially responsible consumer.

The True Costs of Homeownership

February 22, 2019

Are you thinking of buying a house? Maybe you’re tired of your landlord raising the rent on you. Maybe you want to paint every room in your home a different color of the rainbow. Or maybe you’re simply ready to settle down and start a family.

Whatever your reason, buying a house can be a smart and rewarding decision—but you need to go into it with your eyes wide open. Homeownership is a serious financial commitment, and it’s important you understand just what you’re getting into. Unlike renting, owning a home comes with a variety of regular costs you may not have anticipated.

Before you sign on the dotted line, take the time to add up all the related costs and make sure homeownership is right for you. Here’s a quick look at a few of the expenses you’ll be responsible for as a homeowner:

• Your mortgage. Your monthly payment involves more than the principal and interest of your loan. It also includes homeowner’s insurance and property taxes, which can add a significant amount to your payment each month. If you can’t put down 20 percent and have to pay private mortgage insurance, be sure to include that in your calculations.
• Utilities. You probably already pay for some of your utilities as a renter, but as a homeowner, you’re responsible for them all. This includes electricity, water, wastewater, natural gas, garbage collection and recycling. You also will pay for your own internet and cable service.

• HOA dues. If your new home is part of a neighborhood or complex with a homeowners association, you’ll be required to pay regular dues. These can range from just a few dollars a month to several hundred, so make sure you know what the dues are before you commit to buying a property.

• Landscaping. Someone has to mow that huge backyard. Even if you decide to take care of it yourself, you’ll have to purchase a lawnmower and other equipment. Don’t forget to consider that time is money; the time you spend mowing and raking could be better spent doing other activities.

• Maintenance and repairs. Things can—and will—break. You need to have money set aside for emergencies such as a plumbing leak or broken appliance. In addition, you should plan on spending 1–2% of your home’s value each year on general maintenance to ensure your home remains in good shape.

Once you know have a good idea of how much it will cost you each month to own a home, take a look at your other monthly expenses, such as groceries, gas, entertainment, and debt payments, as well as your total monthly income. Most experts recommend you spend 28% or less of your monthly income on housing.

If homeownership still makes sense after you run the numbers, congratulations! You’re in for a fun ride. After you’re done signing the reams of paperwork involved and close on your new home, don’t forget to upload all the documents onto InsureYouKnow.org. It’s a safe place to store all the information on one of the most important transactions you’ll ever make.

How to Raise Your Credit Score

February 7, 2019

You’re more than a number. But when it comes time to getting a loan, it may not feel like it.

Your credit score is a numeric representation of your creditworthiness. Lenders use it to determine whether to loan you money for a major purchase or approve you for a new line of credit. It takes into consideration a variety of factors, including whether you pay your bills on time, the amount of credit you’re using, and how long you’ve been using credit.

There are a number of different scoring models, but the two major ones are the FICO Score and the VantageScore. Ninety of the top 100 largest financial institutions in the United States use the FICO Score to make credit decisions. FICO Scores fall into the following ranges:

• 800–850: Exceptional
• 740–799: Very Good
• 670–739: Good
• 580–669: Fair
• 300–579: Poor

The higher your score, the lower the interest rate on your loan will be. Generally speaking, if your score is 760 or above, you’ll get the best rates. This can make a difference of hundreds of dollars a month and tens of thousands of dollars over the life of the loan. For example, someone with a FICO score of 620 could pay over $200 more each month for a $216,000 30-year, fixed-rate mortgage than someone with a score of 760.

So what do you do if your score is on the lower end of the scale? Fortunately, it is possible to improve your credit score, although it takes time and patience. Here are three things you can start doing today to help boost your score:

1. Pay your bills on time. Considering payment history accounts for 35% of your FICO Score, paying your bills on time is one of the most important things you can do if you want to improve your credit score. After all, if lenders don’t think you’ll pay them back, they aren’t going to loan you the money in the first place. If you tend to be on the forgetful side, don’t panic: Set up payment reminders or, even better, automatic payments.
2. Keep your balances low. The amount you owe on your current accounts determines 30% of your FICO Score. Lenders figure that if you owe too much money to creditors, you may have trouble making your payments and are at risk of defaulting on your loans. They look carefully at your credit utilization ratio, or the amount you owe versus the amount of credit you have available. Because revolving debt such as credit cards carry more weight than installment debt such as mortgages, it’s important to keep your credit card balances as low as possible.
3. Make more than one payment a month. Even if you pay off your credit cards in full each month, you may want to consider making payments throughout the month instead of waiting until the end of your payment cycle. Your credit score is a snapshot in time; if it is calculated right after you pay off your balance, your credit utilization ratio will probably look great, but if it is calculated right after you make a big purchase like a new couch, it might look too high. Making multiple payments a month will ensure your balances remain low and you won’t look like a risky bet to lenders.

Just like any other important financial documents, your loan agreements should be stored in a secure place. When you upload them to InsureYouKnow.org, you and your loved ones will be able to access them should the need arise. It’s just one part of maintaining a fiscally responsible lifestyle.