Happy Halloween! So tell me… is your money situation giving you a terrible fright? While it’s time to put the candy and costumes away for another season — well, maybe not the candy — have you thought about how you can once and for all put a lid on your financial goblins? Here’s a thought for you: consider how much time you spend preparing for a holiday like Halloween, or Thanksgiving or Christmas or … Read More
Question: Can my mortgage lender require me to have an escrow account? Answer: Generally, your mortgage lender can require you to have an escrow account if you borrow more than 80 percent of the value for the property you financed. The percentage you borrow against the valuation of the property is known as the loan-to-value ratio. Each month, in addition to your mortgage payment, the lender collects a prorated amount to be held in … Read More
Question: Our daughter is 4 and we’re starting to save for her college fund. Should we set up accounts in her name or our names? Answer: This really depends on your situation, so I caution you to talk with an attorney, tax professional or financial advisor. Typically, though, I find there are a few points you should consider before setting up accounts in your child’s name: financial aid issues, the kiddie tax, and the … Read More
Question: I’m marrying someone with bad credit. How will it impact my credit? Answer: Even if you’ve had spotless credit, you may be turned down for credit cards or loans that you apply for together if your spouse has had serious problems. It’s a good idea to deal with this issue now rather than wait until after you’re married to discuss it. Attitudes toward spending money, along with credit and debt problems, often lead … Read More
Question: We are expecting our first child and wanted to know when do we need to apply for their Social Security number? Answer: Well, first, congratulations and I’m impressed that you are thinking about these details. To answer your question, there’s no official time limit on applying for a Social Security number for your newborn. However, I suggest you do it right away because you’ll need to included the child’s Social Security number on … Read More
Question: If I take money out of my IRA before I’m 59½, what happens? Answer: What you’re referring to is a premature IRA distribution. If you are under age 59½ and withdraw funds from your IRA, you’ll probably have to pay a 10 percent penalty tax on top of whatever income taxes you owe on the distribution. This can be a major drawback for IRA owners who need money and have few other assets to … Read More
Question: Is it true that the federal government insures retirement plans? Answer: Not exactly. You’re probably referring to something you heard called the Pension Benefit Guaranty Corporation (PBGC) which is a federal agency created by ERISA. PBGC insures certain pension benefits, specifically defined benefit plans, but not other types of retirement plans. To explain it a bit further: A defined benefit plan is a qualified employer pension plan that promises to pay a specific … Read More
Earlier today, I tweeted about an article that Eleanor Blayney, CFP® wrote regarding romance and financial compatibility. I thought it was worth posting a link to it as it has some thoughtful tips. Wishing financial harmony to you and your Valentine! LOVE & MONEY: MAKING SURE YOUR VALENTINE IS A GOOD FINANCIAL MATCH CFP Board Consumer Advocate Shares Financial Planning Tips to Keep Relationships Strong As Valentine’s Day approaches, couples rush to find … Read More
Even with the downturn in the real estate market, some people think they can do a better job on their own. While certain tasks of selling a home may seem simple — putting up a ‘for sale’ sign, a few flyers, posting the home in classifieds and possibly holding an open house — there is much more involved than meets the eye. Real estate agents help countless people buy and sell homes, attend many … Read More
When I was young, nothing could get under my skin faster than if my mother said, “Well, your intentions were good.” I knew it was her way of trying to make me feel better about something I did that didn’t quite pan out; but, it hit a nerve. Over time I realized why it bothered me so much. Intentions amount to zip if you don’t back them up with the right actions. A New … Read More