Are Your Assets Protected?
Asset protection is more important than ever before. Today, you have risks at every turn. Lawsuits, high cost of long-term care, auto and home accidents, or years of Probate. All too often, we settle and fail to consider the importance of comprehensive protection. In other cases, all we need is the best legal document to protect what we own. It is not worth rolling the dice and sacrificing your savings or your hard-earned assets. And it is next to impossible to keep up with what you need for protection. Many changes you need come without warning.
Homestead Real Estate
Suppose you are married and currently working as the police. In that case, your principal place of residence should be titled in Tenants by Entirety. This form of legal title protects your marital property from the creditors of one spouse.
With the growing availability of concealed carry laws, more citizens are choosing to carry firearms and to keep them accessible for defense in their homes.
However, even for justifiable acts of self-defense, a claim for monetary damages can be made against you by your assailant or innocent bystanders. You can also be held liable for gun-related incidents while hunting, in gun clubs, or while shooting at commercial or private ranges.
Check out the Benefits Plan website for more information.
Asset Protection with Automobile Insurance
The most common auto policy written today is the same as it was 25 years ago – $100,000/$300,000. It means you have $100,000 in individual protection for damages caused by you or a covered driver on your policy. Similarly, you have $300,000 total coverage for all injured parties.
Consequently, you are personally responsible for damages that exceed these amounts. Even a minor accident can result in hospitalization, extended medical care, or death. However, Umbrella Insurance only costs an average of $250 per year. The policy provides an additional $1 million in liability protection for each covered vehicle and your residence.
Investment Real Estate
If you own commercial property, your renters can sue you for various reasons. For example, claims made for injuries resulting from property defects inside and outside of the residence. First, be sure you have the right coverage and are not overpaying. Secondly, eliminate any personal liability concern for excess claims by holding title to any investment property in either a Corporation or an LLC. Moreover, a Series LLC allows you to separate liabilities from each property if you own more than one investment property.
Long Term Health Care
Will you need it? For those who live longer than age 65, 70% will need some long-term health care. To clarify, only 40% of people will require inpatient nursing care. However, all long-term health care is expensive. Fortunately, there is a hybrid insurance policy that is offered exclusively to Benefits Plan members. This policy provides long-term care insurance and, if not accessed, it can be converted to life insurance at your death.
Living Trusts and Asset Protection
At the end of your life, or if you become incapacitated, property or bank accounts in your name, are at risk of Probate.
- A Will must be probated. The rule is no one can legally sign your name. Therefore, all assets in your name are subject to the complete probate process at your death or incapacity. This court process averages 18 months and is costly.
- A Living Trust completely avoids Probate.
- A Living Trust estate plan includes both Health Care and Financial Power of Attorney documents and a Last Will and Testament for guardianship of minor children and to “pour over” any assets still in your name at your death, out of Probate.
A Revocable Living Trust is a written, legal document that allows you to privately pass your assets to your family, friends, or charities after your death. Assets in a properly funded Trust are not subject to Probate. These include real estate, bank accounts, stocks, and minor beneficiary policies and accounts. Your life insurance policies and deferred compensation accounts can name your Living Trust as beneficiary, subject to essential tax considerations. However, often it is recommended that adult beneficiaries, without legal or other restrictions, be named as beneficiaries.
Comprehensive Benefits of America
For an expanded presentation of asset protection and financial wellness strategies and to receive regular updates on strategies to protect what you have earned, visit and register with CBAPlan on the link below. Registration is free.
Visit www.cbaplan.com or call 1-312-559-8444 for assistance with registering.
The Young Person’s Guide to Investing
Narrowing down all the options and figuring out where to turn can be paralyzing. We’ve got you covered.
Investing doesn’t have to be that complicated.
But when you’re just starting out, it can be hard to knock it off your to-do list because you have so many competing demands — a budding career, rent and student debt, to name just a few. You also need at least some basic knowledge, which probably wasn’t covered in any of your classes in high school or college.
The good news: There are more attractive options for entry-level investors than ever before. Many mutual funds cost just fractions of pennies for every dollar you invest, and some firms are dangling them for free. Even getting advice from professionals is easier than it was for previous generations. And after you go through the motions once, you can set your plan on autopilot for a while.
But narrowing down all the alternatives and figuring out where to turn? That can be paralyzing.
This guide can help — consider it your road map to investing.
There are a couple of items you want to deal with first: preparing for a financial emergency and creating a plan to attack any high-cost debt you might have.
Building a financial cushion will help soften the blow should your money situation change, whether that’s because of the loss of a job or because of a giant unexpected expense. Most financial planners suggest keeping at least three to six months of living expenses in cash — to cover the basics like rent, food, utilities, loan payments, student loans, etc. — in a traditional bank account that’s backed by the Federal Deposit Insurance Corporation. That means your savings are insured by the federal government, up to certain limits, if the bank fails.
You can find the best interest rates at online banks, and the easiest way to get started is to set up regular, automatic transfers from your checking account. (Capital One 360, for example, lets you set up different savings accounts, which you can label for different purposes — emergency fund, annual vacation and so on).
If you have really high-cost debt — like credit card debt — you want to deal with that before investing significant amounts of money. If you’re earning 7 or 8 percent over the long term in the stock market but paying 15 percent on a card, you’re better off tackling the debt first.
That logic doesn’t necessarily apply to your student loans. Depending on the type of person you are — maybe you detest debt or like to tackle one big task at a time — it might feel better to pay down your loans first. But there’s a strong case to be made to both invest and pay down your loans simultaneously, if you can. (People with piles of high-cost student debt should seek help.)
Investing early and often puts you at a huge advantage, thanks to the magic of compounding numbers, which is illustrated below. Need we say more?
How much to save and invest, and where?
So you have some money to invest or are working and want to set up a plan for your long-term goals. Many financial experts recommend saving at least 12 to 15 percent of your salary to achieve a secure retirement, and others suggest even more.
But even 10 percent might seem like a laughable notion at this stage. There are ways to inch closer to that goal, however, without doing all of the savings on your own.
Much of how you get there will depend on whether you have access to a retirement plan through your employer, typically a 401(k) at for-profit organizations and often 403(b) plans at nonprofits.SMARTER LIVING: A weekly roundup of the best advice from The Times on living a better, smarter, more fulfilling life.Sign Up
If you do, then much of the hard work is done for you. Employers must vet and assemble the plan’s menu of investment options. On top of that, you contribute money that hasn’t yet been taxed, so it lowers your tax bill. The money then grows tax-free over time, and you pay tax on the money when it’s withdrawn in retirement.
The best part? Some employers will also provide a matching contribution for your savings. They might match every dollar you contribute, say, up to 4 percent of your salary. That matching money is a guaranteed return, regardless of what the stock market is doing. Save as much as you can to grab all of that free money.
Then, each subsequent year, you might crank up your savings by one percentage point (some plans have tools that can automate this), so within a few years you will be closer to that respectable goal of 10 percent of your salary (which includes what your employer kicks in).
Just remember: Not all employer-provided plans are good ones. Some are downright awful, stuffed with high-cost, low-quality investments. How do you know whether your plan is a winner? The costs you pay for the plan are typically a telltale sign — and paying too much can cost you tens of thousands of dollars, if not more, over the course of your career.
“If you see a bunch of funds that are charging more than 1 percent a year, that is a red flag,” said Christine Benz, director of personal finance at the investment research firm Morningstar, referring to investments that charge more than 1 percent of your total money invested. You can also ask human resources (or the person coordinating the plan) to see a copy of the summary plan description, which should list any other administrative fees that aren’t immediately obvious. (BrightScope also has a tool that ranks thousands of plans.)
If you’re in a high-cost plan, save enough to get any company match, but consider investing anything extra into another type of account.
For younger people, Roth I.R.A.s are often the preferable choice. That’s because you deposit money that has already been taxed, and you’re probably in a lower tax bracket now than you will be later in life when you’re earning more. In contrast, with a traditional I.R.A., investors get a tax deduction now, but pay taxes when the money is withdrawn. Your Roth I.R.A. balance is what you will actually have to spend; in a traditional I.R.A., it will be reduced by the amount of tax you will owe later.
Another upside to a Roth: In an emergency, you can withdraw contributions — but not any investment earnings — without penalty. (Not that you want to do that!) However, there are income ceilings that determine who can contribute, as well as other rules around withdrawals.
For a more comprehensive look at the various other types of plans, including traditional I.R.A.s, read our retirement guide here.
Why you should use index funds
Resist the temptation to use the latest slick app promoting its ability to invest in single stocks or cryptocurrencies. You want to do the opposite: Own a collection of cheap and boring mutual funds that invest in different kinds of stocks from all over the world, with a helping of safe bond funds to cushion the inevitable swings of the stock market. That way, if anything goes wrong with a particular stock or sector of the market — say, technology or emerging markets — you’ve hedged your bets.
That’s why you’re better off in what’s called an index fund, whose investments simply mirror big sections of the stock market — the S&P 500 Index, for example, tracks the 500 largest publicly traded companies in the United States.
Investors paid an average cost — known as the expense ratio — of 0.48 percent of their assets, meaning 48 cents for every $100 invested, for mutual funds and exchange-traded funds in 2018, according to a Morningstar study. That’s down from 0.51 percent in 2017. (Exchange-traded funds, or E.T.F.s, are similar to index funds, but trade on an exchange like stocks. For most investors, the difference between a mutual fund and an E.T.F. is negligible. Since many providers have waived trading commissions on E.T.F.s, the ultimate decision on which to invest in might come down to whichever has the lowest expense ratio. But if you’re investing in a regular taxable brokerage account, E.T.F.’s might be preferable because they are more tax efficient, experts said.)
Funds that are actively managed by human pros often cost 1 percent of your assets annually or more — that’s $1 or more for every $100 invested.
That might not seem like a lot, but consider that index funds that track the entire stock market can be had for mere pennies for every $100 invested. Fidelity has gone even further — it offers four index funds that are free and do not require any minimum investment (More on that here.)
Paying rock-bottom prices can add many tens of thousand of dollars, or more, to your balance over the course of your career.
Picking the right mix of investments
One of the more important decisions you will make — besides how much you pay for investments — is how you decide to divvy up your investments among stock, bond and other funds, something known as your asset allocation.
Younger people can generally afford to take more risks and invest more heavily in stocks — which have the potential to generate more growth over time — because they have many working years ahead of them. If the market tanks, their portfolio has time to recover.
But how much you ultimately decide to dedicate to stocks overall should also depend on the strength of your stomach to tolerate market swings.
One way to figure this out is to ask yourself a question: The stock market tumbled nearly 50 percent during the Great Recession. If you had most of your money in stocks at that point, how would you have reacted?
If the answer is, “I probably would’ve sold more stocks,” well, that means you probably had too much to begin with. Then you’ll need to figure out when to get back into the market — and you will most likely be wrong. You want an allocation that will allow you to stay the course, even if it’s a bumpy ride. But if you’re too conservative, you’ll have to save more because your portfolio probably won’t grow as fast.
Also consider the following: An investment portfolio evenly divided between stocks and bonds would have lost nearly 29 percent of its value in the Great Recession, but it would have taken only about a year to recover, according to an analysis by Vanguard. A portfolio that was 100 percent stocks — and lost about 55 percent — would have taken about three years to recoup its losses.
So how do you figure out what stock-bond mixture will work for your situation? One type of mutual fund, known as a target-date fund, does that job for you.
You pick a fund based on the year you hope to retire — so if you’re 40 years from retirement, you’d chose the 2060 retirement fund. As that date draws closer, its mix of investments slowly becomes more conservative.
A couple of 2060 funds — including Fidelity’s and Vanguard’s — now allocate about 90 percent of their portfolios to stock index funds (with roughly 55 percent in United States stocks and 35 in international) and the remainder in bonds. Schwab’s version is a bit more aggressive: it has 95 percent of assets in stock funds. Be sure to look under the hood so you know what’s inside: When markets plummeted in 2008 to 2009, many target-date funds with the same target date had returns that varied widely.
Another benefit of target-date funds: If you put all of your retirement money into one fund, you won’t have to worry about routine portfolio maintenance known as rebalancing. That’s when investors sell investments that have ballooned beyond their initial target (of, say, 90 percent in stocks) and reinvest the proceeds into the side of the portfolio that has shrunk, relatively speaking.
Other services, known as roboadvisers, can also do much of this work for you. More on those in a minute.
Saving for goals besides retirement
Shorter-term goals — buying a condo or a car or saving for a wedding — generally require a less risky approach.
If you’ll need to use the money in three years or less — say, for an emergency fund or a vacation — the answer is easy: Shuttle your savings into a high-yield savings account each month, one with a competitive interest rate, said Matt Becker, a certified financial planner in Florida. With such a short time frame, the amount of money you save is more important than any return you may earn — and you don’t want to risk losing anything.
If your goal is anywhere from three to 10 years away, you might take more of a hybrid strategy. If you want to buy a home in five years but can be a little flexible on timing, you might invest one half in a savings account and the remainder in a fund balanced between stocks and bonds.
“A good rule of thumb is to expect that in any given year you could lose half of whatever money you have in the stock market,” Mr. Becker said. “Of course, you would also expect to recover that over time, but over shorter time periods that may be harder to do.”
If you want to buy a home in five years from now or longer and know you’ll need at least $60,000, he said you might put half of your monthly savings into a savings account or a certificate of deposit, while the other half goes into a taxable brokerage account that holds something like Vanguard’s LifeStrategy Moderate Growth Fund, which is 60 percent stocks and 40 percent bonds. That means you’d have about 30 percent of your money in stocks — in other words, 15 percent of your savings could vaporize in a down market. For absolutely certainty your money will be there by a certain date, use a high-yield savings account.
Where should I go to get started?
Outside of a solid employer-sponsored retirement plan, the best place to get started is at one of the brokerages where you can gain access to index funds with ease — Fidelity, Schwab and Vanguard all provide solid options for entry-level investors, for example, depending on your personal preferences.
You might also consider a so-called roboadviser, which will ask you a series of questions before formulating an automated investment plan for a specific goal. Several of them also offer help from human advisers for an extra fee.
The Robo Report, which tracks and analyzes roboadvisers, ranked Betterment as its top pick for entry-level investors.
“Their platform is intuitive and simple, has a $0 minimum balance and has a high-interest savings account for cash reserves,” said Ken Schapiro, president at Backend Benchmarking, which publishes The Robo Report. “They have strong online features, and a client can easily graduate from their digital-only service to their service with live advisers as their needs grow.”
Professional help can also be found for less money these days, though it will obviously cost more than a robot adviser.
A warm-blooded professional may be worth it, particularly if you’re having trouble getting your debt under control or need more hand-holding with a specific issue.
But you’ll need to find someone who is truly working in your best interest and not lining their pockets at your expense.
To increase your chances of finding someone like that, ask if they are acting as a fiduciary. The pros most likely to be fiduciaries are “certified financial planners” who are also “registered investment advisers.” Then, you probably want to find one of these individuals who charge you an hourly rate for their time or another type of flat fee; you want to avoid financial advisers who only earn money when they sell you a product.
Here’s where to find them: XY Planning Network; Garrett Planning Network; The National Association of Personal Financial Advisors.
But most younger investors really don’t need all that much help. If your situation is relatively simple and you’re just looking to become more knowledgeable about money and investing, there are plenty of materials that can provide a solid foundation: “I Will Teach You to Be Rich, Second Edition,” by Ramit Sethi; “If You Can,” by William Bernstein; “Broke Millennial Takes On Investing,” by Erin Lowry; and anything by John Bogle or Helaine Olen.
Tara Siegel Bernard covers personal finance. Before joining The Times in 2008, she was deputy managing editor at FiLife, a personal finance website, and an editor at CNBC. She also worked at Dow Jones and contributed regularly to The Wall Street Journal. @tarasbernard
COVID-19 Stimulus Payments Round 2: What You Need to Know
Congress has finally reached a bipartisan deal on a $900 billion Coronavirus Relief stimulus package, and the President has signed it into law. This one also includes a stimulus payment, but there are big differences between this one and the Coronavirus Aid, Relief, and Economic Security (CARES) Act passed in March.
Who qualifies for this round of stimulus payments?
The requirements are similar to the last round of payments with the upper income limits reduced.
To qualify for the economic impact payments you’ll need to meet each of the following requirements:
- Have a social security number
- You are a U.S. Citizen or U.S. Resident Alien
- Make less than $87,000 filing single or $174,000 as a couple on your most recent tax return
- You weren’t claimed as a dependent on someone else’s tax return
How much is the stimulus payment?
This COVID relief bill includes only up to $600 for qualifying adults, which is half of the amount offered by the CARES Act in March.
If you made under $75,000 on your most recent tax return, you will be eligible for the full $600. Couples that filed together and made under $150,000 on their last return will be eligible for $1,200 combined.
If you made over the income limit but less than $87,000 filing single or $174,000 as a couple and meet the other requirements, you’re eligible for a reduced payment.
You are also eligible for a flat amount of $600 per child dependent 16 or under.
How will I get my payment?
You will receive your payment through either check or direct deposit using the same method you requested filing your 2019 tax return.
When will I get my stimulus payment?
Last week, Treasury Secretary Steve Mnuchin told CNBC that the first payments will go out before the end of the year.
While it will be a bit longer before everybody receives payments, they will probably be available much faster than last time since the Internal Revenue Service (IRS) already issued similar payments earlier this year.
How can I get my stimulus payment with Varo?
If you requested your 2019 tax refund as a direct deposit to your Varo Money bank account, you’ll receive your payment as soon as it’s issued by the IRS.
What can I do with my stimulus payment?
There is no limitation on how you can spend the money. These stimulus payments were issued by the federal government to help working class and middle class Americans who’ve been impacted negatively by the pandemic. If you need to spend it to cover basic expenses, you should.
If you don’t have immediate expenses to cover, it’s a good idea to save it. Sign up for Varo’s high APY Bank Account here.
Will I get another stimulus payment?
Currently, the bill the President signed only allows for the $600 payments, but there is a move in Congress to raise these payments to $2,000. While this raise in the stimulus payment passed the House, it has not yet come to a vote in the Senate. Joe Biden has also said he’ll push for another round of checks when he’s in office. There is no guarantee that the stimulus payment will be raised to $2,000 or that there will be another round of payments.
This COVID relief bill did extend the enhanced $300 a week unemployment benefits for up to 11 weeks, so if you qualify for unemployment you will likely keep this benefit. Restarting unemployment benefits under the new law may take states 3 weeks or more according to experts. Be patient as states get in gear to provide these benefits.
By Editors at Varo
Opinions, advice, services, or other information or content expressed or contributed here by customers, users, or others, are those of the respective author(s) or contributor(s) and do not necessarily state or reflect those of Varo Bank, N.A. Member FDIC (“Bank”) or Comprehensive Benefits of America, LLC, (CBA). The bank and CBA are not responsible for the accuracy of any content provided by author(s) or contributor(s).
Links to external websites are not managed by Varo Bank, N.A. Member FDIC, or by Comprehensive Benefits of America, LLC.
Securities offered through Registered Representatives of Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Advisory services through Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Cambridge and CBA are not affiliated.
Everything You Need to Vote
November 3, 2020 is Election Day and it’s coming up on us quick.
We want to help you prepare. Here’s everything you need to do to make sure your vote counts this year.
Make sure you’re registered
Don’t wait until late October to get ready to vote. In some states, the deadline to register to vote is 30 days before Election Day.
Check your voter registration status today.
To do that, you can head to the Can I Vote? webpage.
The National Association of Secretaries of State (NASS) runs this page, which helps you because each state’s voter registration process is different.
Head to their Voter Registration Page and choose your state. That will redirect you to your state’s voter registration check.
You’ll need to put in some personal information to check your status. Sometimes this includes your driver’s license number or the last four digits of your social security number.
If you find out you’re not registered to vote, don’t panic. As long as you’re 30 days out from the November 3 date, you can still register in every state.
Check Your State’s Registration Date on This Calendar from When We All Vote
Figure Out How to Cast Your Vote
Once you’re registered, figure out if you’re going to vote in person or via mail-in ballot.
To vote in-person, you show up to a polling place on November 3.
Pick your state on the NASS Find Your Polling Place. Then you’ll be sent to your state’s website.
Most states have tools that help you find polling places near you.
On Election Day, you will probably need to bring some form of ID. Check your state’s laws on the National Conference of State Legislatures Voter ID Requirements page.
You can also usually call your polling place and ask what you need to bring.
Types of documentation vary so make sure you read your state’s specific requirements.
On November 3, show up to your polling place with your documents.
The poll worker will guide you through the steps. That’s it.
Most states also offer mail-in (also called absentee) ballots for people who don’t want to vote in-person.
Every state offers absentee ballots, but some states require a reason for needing to vote in this way.
Because of COVID-19, though, many states have loosened restrictions. Some states are even sending absentee ballots to all voters.
In other states, you’ll need to request an absentee ballot if you want to vote by mail.
NASS has more tools you can use here. Visit their Absentee & Early Voting page and choose your state.
That should send you to your state’s webpage where you can access the application for an absentee ballot.
In most states, you need to request your absentee ballot a week or two before Election Day.
Then, you need to send it in before November 3 in many cases.
To find out your state’s deadlines, you can use this chart from Vote.org.
Once you get your absentee ballot, make sure you fill it out accurately.
Usually, you’ll need to sign the ballot in a couple of places, including on the outside of the envelope you send it back in.
Educate yourself before you vote
There’s one more thing you need to do before you vote: research.
Even if you already know how you’re going to vote in the presidential election, remember there are many state and local issues on your ballot.
Ballotpedia has a helpful tool here. Use their Sample Ballot Lookup tool.
Input your address to pull up your sample ballot.
Your sample ballot will show you what ballot measures you can vote on.
Plus, you’ll see federal, state, and local government seats that are up for election so you can make your picks.
Research the measures and people you’ll be voting on so you can make educated decisions on your ballot.
Your vote counts.
by Kacie Goff Varo Bank
Is Taking a Gap Year This Fall a Good Idea?
The reality of COVID-19 has college students across the country planning to skip the upcoming school year, with some citing worry over personal finances and concern over online classes. Many students and their families lost income amid the pandemic, making it tougher to pay tuition and other educational expenses. And while college administrators are planning reboots that reduce the potential health risks of starting school this fall, students aren’t excited about the proposed instructional delivery options. Taking hybrid and online classes are unappealing to those who signed up for a traditional college experience.
But financial roadblocks and less-than-desirable learning environments may not justify putting your education on pause this fall, especially when considering some of the drawbacks. Let’s look at a few problems you might encounter if you take a gap year and skip college enrollment this coming semester.
Problem #1: No One Knows When or If We’ll Get Back to “Normal”
Lively student unions, packed dorm rooms, and full lecture halls are a thing of the past, at least for now. Whether we’ll return to a typical college experience anytime soon is seeming more unlikely. Even the possibility of having millions of students crisscrossing the U.S. to return to campus by spring isn’t guaranteed. Some would describe that scenario as an epidemiological nightmare in the making. But, waiting it out could mean unnecessarily delaying your education, especially when colleges and universities are bolstering their online instruction offerings for new and returning students.
Problem #2: The Typical Gap Year Benefits are Fewer
When students think of a typical gap year experience, it usually includes working a full-time job, traveling abroad, or exploring potential career interests. This year, those options might be off the table. Even though the unemployment rate declined to 11.1% in June 2020, finding full-time work may still be challenging. This is still nearly three times as high as it was in March 2020. Even then, unemployment rates were already creeping higher when compared to the prior year. Don’t forget that COVID-19 travel restrictions are still in place in many parts of the globe, and many in-person internships are being converted into virtual ones.
Problem #3: Re-Admission May Be an Issue
Whether you’re considering taking a semester off or the entire academic year, understand that each college has its policy for approving leaves of absence and re-admission. Some may be more lenient than others due to the coronavirus crisis, but that doesn’t mean returning to school will be easy. With an approved leave of absence, you can stop attending school for a maximum of 180 days within a 12-month time frame. But withdrawing from school or failing to return from your leave could have unwelcome consequences.
Colleges and universities are not required to re-admit students, even if they meet the requirements for re-admission. Each school and program is different, but know that some colleges may require you to:
- Apply for re-admission and pay a fee
- Meet updated re-admission requirements
- Comply with revised graduation requirements due to changes within the program of study
- Complete additional coursework based on changes to a program’s graduation requirements, thereby increasing the total cost of your education.
Contact your school for details on their specific re-admission requirements.
Problem #4: You Could Be Forced to Start Student Loan Repayments
Most student loan programs allow students a six month grace period before borrowers must make their first principal and interest payment. However, federal and private student loan grace periods differ by loan type and lender. Some student loans have shorter or no grace periods before you must begin repayment. Speak with your loan servicer or school’s financial aid office to confirm how this would apply to your specific situation. The length of time you stay withdrawn or are enrolled less than half-time will influence which loans you must start repaying and when.
Did You Know?
The cost of borrowing money for college is at an all-time low. Federal student loan interest rates for the 2020-21 academic year have dropped to 2.75% for undergraduate borrowers. This historically low-interest rate applies to Federal Direct Subsidized and Unsubsidized student loans. Graduate student borrowers can secure Direct Unsubsidized Loans at 4.3%. Parents of undergraduates and graduate students can obtain Direct PLUS Loans at 5.3%.
Add the automatic administrative forbearance that has put student loans at 0% interest and pauses payments thru September 30, 2020, and it seems like taking a gap year right now would be less than ideal from a financial perspective. Even private student loans are setting record lows of 2.99% variable APR or 4.99% fixed APR.
Pausing your education because you feel COVID-19 is undermining your college experience can create more problems than it might solve. However, the emotional and mental health benefits of taking a break from everything might be the best choice for some individuals. Carefully weigh your options and potential consequences before making a final decision. Only you know if taking a gap year is the right thing to do in your particular situation.
Please note that the information provided on this website is provided on a general basis and may not apply to your own specific individual needs, goals, financial position, experience, etc. LendKey does not guarantee that the information provided on any third-party website that LendKey offers a hyperlink to is up-to-date and accurate at the time you access it, and LendKey does not guarantee that information provided on such external websites (and this website) is best-suited for your particular circumstances. Therefore, you may want to consult with an expert (financial adviser, school financial aid office, etc.) before making financial decisions that may be discussed on this website.
How Your Pet Can Help Your Mental Health
My young daughter struggles with anxiety. During a recent episode of panic I was struggling to help her calm her racing mind when my sixty-five-pound Pit Bull mix came to check on her, and it brought me a moment of clarity.
“You know,” I said to her, “scientists found that petting your dog can help you calm down when you’re upset.” She didn’t hesitate to put her hand on his neck and stroke him. In a few moments, the tears slowed and her breathing improved. She sat there petting him slowly, and in a matter of minutes it was almost as if nothing had happened. Since her worries tend to pop back up at bedtime, I asked if we could move the dog’s bed into her room. He’s slept by her side every night, and we’ve had no bedtime struggles since.
Our pets provide us with so many avenues to improve our mental health beyond just a comforting presence. Yes, it’s true that petting a dog can release oxytocin and lower your blood pressure (even more than talking to another human according to this study). You might be surprised at some of the other science-supported ways your pet helps your well being.
Walking Your Dog
Multiple studies have shown that dog owners are less depressed than those without dogs. Most dog parents, a whopping 87%, exercise the recommended 150 minutes per week. Mental health benefits, including reduced anxiety and depression, as well as physical health benefits follow with each step.
You don’t need to make dog walking an epic journey. Just a quick 10 minutes around the block, stopping at a few trees or fire hydrants along the way, can make huge improvements and get the ball rolling for increased endurance later on.
If walking a dog isn’t an option, just playing with a pet in the home releases serotonin and dopamine to help your mood. If pet ownership isn’t a reality for you right now, consider volunteering to groom cats or walk dogs at your local shelter where you’ll get these benefits, help adoptable animals, and even build a routine for yourself.
Building Routine & Building Relationships
Routine is important. Some pet parents report that their walking routine helped their overall well being, while others said the walk helped them feel more connected to their neighbors. The sense of purpose that comes with routinely feeding, grooming, and attending to your pet can help you find meaning and joy in life when it can otherwise be a struggle.
If you aren’t up to taking care of yourself, now might not be the right time for pet ownership. But if you think you might have an easier time getting out of bed in the morning if a pet needed cared for regularly, a pet might help you. Fostering could be a good short-term stepping stone into pet ownership. The companionship that comes with a pet has been well-documented to decrease the symptoms of depression and loneliness and increase the quality and length of life.
Pets Provide Reassurance
I feel safer and calmer when my dog is around. On those rare days when I’m home alone without him, I’m more aware of every noise I hear. When our pets are home and sleeping quietly, we can’t help but feel more secure and at ease. This sense of reassurance is not limited to watchdogs. Experiencing the love of a pet helps children and adults build their self-confidence. Whether a child is reading to a dog, snuggling with them, or teaching them tricks, the dog-human bond is free of any judgement, criticism, or negativity, and can even lead to increased social skills with other people.
One last bit of uplifting news: Most studies on the mental health benefits of companion animals find that animals also benefit from the same increased levels of oxytocin and dopamine that we do when we spend time with them. Your dog doesn’t just look at you like they love you. They really do love you. Knowing that the mental health benefits of pet ownership are reciprocal makes me happier just thinking about it.
The Latest Twitter Hack Shows that No One is Immune
Twitter Hack – Account Takeovers that IDShield Will Warn You About
The latest Twitter hack is being called one of the most audacious cybersecurity hacks of all time. If you don’t know what happened, here’s the high-level: On or about July 15, 2020, hackers hijacked the Twitter accounts of some of the world’s most famous people, including Joseph R. Biden Jr., Barack Obama, Kanye West, Bill Gates, Elon Musk and more. The incident also impacted some of the world’s biggest companies including Apple and Uber.
Star-studded issues aside, we at IDShield want to remind everyone, even if they are not publicly recognizable, of the importance of social media protection.
In the worst cyber incident in the company’s 14-year history, hackers infiltrated 130 high-profile, verified accounts and tweeted messages with a false promise: Send Bitcoin cash, and these prominent figures would send you back double the amount. The accounts were confirmed to have been compromised in what Twitter believes to be a social engineering attack.
What’s a verified account?
The blue verified badge on Twitter lets people know that an account of public interest is authentic.
The badge appears next to the name on an account’s profile and next to the account name in search results. It is always the same color and placed in the same location, regardless of profile or theme color customizations.
What is a social-engineering attack?
Social-engineering is when a cybercriminal manipulates and tricks users into making security mistakes or giving away sensitive information. Such a plot often involves tactics of phishing, pretexting, baiting, quid pro quo and tailgating. This is one of the most common cyber schemes, and what makes it so dangerous is that it relies 100% on human error. Content from a verified account from your favorite politician or tech giant has got to be real, right? Spoiler alert: It may not be.
It has been reported that the scammers received hundreds of payments, totaling thousands of dollars. It was an unprecedented attack on privacy, trust and security, but what’s even scarier: some experts say the hackers could have caused far more damage.
Another learning experience for the books
Unnerving, right? How many more attacks will it take for everyone to realize that online privacy and reputation management is not a light-hearted recommendation? In the age of digital warfare, everyone must understand how scammers operate, and how to utilize defense tools and resources.
How would someone with IDShield have been alerted?
The statement “…payments sent to my BTC address!” and the link/web/email address ‘bc1qxy2kgdygjrsqtzq2n0yrf2493p8…” would have triggered these reports:
- Account Takeover
- Malware / Phishing / Scam
Upon receiving the reports, the messages could have been caught and deleted faster, saving thousands of people a boatload of money and regret.
Here are more details on what IDShield scans and reports on specifically within Twitter:
- Potentially inappropriate self-tweets, self-re-tweets
- Potentially inappropriate mentions or direct messages from other users
- Any username or profile changes (potential account takeover)
Protecting yourself is more critical than ever before
We cannot stress this enough: help yourself, your family and your company. If you see suspicious messages, trust your gut and know it’s most likely a scam. Be proactive and use your resources.
IDShield is a product of Pre-Paid Legal Services, Inc. d/b/a LegalShield (“LegalShield”). LegalShield provides access to identity theft protection and restoration services. For complete terms, coverage and conditions, please see an identity theft plan. All Licensed Private Investigators are licensed in the state of Oklahoma. This is meant to provide general information and is not intended to provide legal advice, render an opinion, or provide any specific recommendations.
Get the latest information on the coronavirus tax impact from your trusted partners at Block. Tax Time Is Almost Here and this Year is Challenging!
The coronavirus (COVID-19) has presented us all with some very unique challenges. We understand you may have questions regarding how the coronavirus impacts your taxes. H&R Block is here for you with up-to-date news and facts regarding any changes to tax filing deadlines and coronavirus tax extensions. And, as always, our tax experts are here to answer questions and provide guidance when you need it.
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March 25, 2020 : H&R Block
You might have heard about the 90-day tax payment extension due to the coronavirus pandemic but aren’t certain about what it covers. What does the extension mean for most Americans? Do taxes still need to be filed and paid by April 15, 2020?
Tax Day is now July 15, 2020, due to the coronavirus pandemic. This change includes the filing and payment deadline. The IRS is still accepting returns and processing refunds, and we are ready to help you get your important refunds now (see options at the bottom of this article).
Want to find out more? Read on as H&R Block’s experts at The Tax Institute are here to help you understand the changes to the tax deadline due to the coronavirus.
Covid-19 tax deadline: What you need to know
As of March 20, 2020, the Treasury Department announced the following covid-19 tax deadline guidelines, giving certain taxpayers and businesses an additional 90 days to file and pay their 2019 tax liability. Here are the key dates.
Tax return deadline – July 15, 2020. Your tax filing is now due on this date. If you need more time, you can request an extension to October 15, 2020. Read the FAQs below for details.
Tax payment deadline – July 15, 2020. If you owe income taxes for 2019, you can delay your IRS payment until this time. You will not owe interest or penalties if you pay before this deadline.
Frequently asked questions about the coronavirus tax deadline changes
Q. Who is eligible for the tax filing and payment deferral?
A. The following types of filers are eligible to use the special coronavirus tax extension.
- Individual Form 1040 filers
- Corporations filing Form 1120
- Trusts and states filing Form 1041
- Fiscal year partnerships, associations and companies with due dates on April 15, 2020 (uncommon)
Q. What do I need to do to delay my filing and tax payment?
A. You must file your tax return or extension by July 15 as you normally would. The 90-day tax payment deferral itself is automatic when you file, which means interest and penalties are automatically waived for 90 days and won’t accrue for qualifying taxpayers and businesses until after July 15.
Q. What if I need more time to prepare my return?
A. You must file Form 4868 to request an extension by July 15, 2020. This extension would give you until October 15 to file your return, but your payment would still be due by the extended payment deadline, July 15, 2020.
Q. What if I’m getting a refund? Does this news affect me at all?
A. It should not affect you if you’re receiving a refund. The Treasury Department says you should still expect to receive your refund within the normal time period (9 out of 10 are received within 21 days of electronic filing).
Q. What types of payments does this deferral cover?
A. It covers income tax payments, as well as any normally associated interest and penalties, such as the failure-to-pay penalty. It also covers estimated tax payments (included payments of tax on self-employment income) due on April 15, 2020, for the 2020 tax year.
Q. How much can I defer?
A. There is no limit on the amount of tax payment you can defer.
Q. Does this deferral apply to 2020 estimated tax payments (including estimated self-employment taxes)?
A. It depends on the payment date.
- First quarter 2020 estimated tax payment – The deferral includes this estimated tax payment otherwise due on April 15, 2020.
- Second quarter 2020 estimated tax payment – The deferral does not apply to this tax payment due on June 15, 2020. In addition, the penalty for failure to make estimated tax payments for 2019 is not waived or deferred.
Q. Does this deferral apply to my state tax return also?
A. States are issuing their own guidance about deadlines. For more information, see State income tax returns impacted by the coronavirus (COVID-19).
Q. Does this announcement mean I don’t owe taxes for 2019?
A. No, the deferral only extends the due date of when your tax liability is due. Interest and penalties will again accrue on outstanding tax liabilities starting July 16, 2020. The deferral does not exclude or exempt taxpayers from filing if they are already required to file.
H&R Block is here to help during the coronavirus tax extension
During the extension period, H&R Block will be standing ready to help—no matter how you choose to file. We understand how important your refund is to your financial wellbeing. And now more than ever, we’re ready to get you the most money back.
Drop off your documents
You can bring your documents to any of our offices and we’ll do the work without you having to wait. Our tax pros will call you with any questions and can send your completed return electronically for you to review and approve.
Tax Pro Go
Use your mobile device to upload your tax documents and a tax pro will prepare your return virtually.
Online or desktop software
If you prefer to do your own taxes, you can prepare your taxes using H&R Block Online or H&R Block Software. If you have questions, there are options for unlimited help and even a final review of your tax filing.
At H&R Block, we’re committed to providing information you can trust that you can use to help navigate the changing tax landscape. If you’d like to stay informed about the tax impact of the coronavirus pandemic, visit our Coronavirus Tax Impact page for the latest information.
Coronovirus – COVID-19 Telemedicine is Here for You 24/7
Healthiest You is partnering with the CDC (Centers for Disease Control and Prevention), state and local health officials, and our health system partners to provide our communities with the support, information, and the care they need.
Getting care and guidance from the comfort of your own home can put your mind at ease and help you avoid heavily public areas such as doctors’ offices and the ER, which can carry many germs. Our providers can evaluate your risk and advise you on next steps.
While there is no treatment for COVID-19, people who are mildly ill may be able to isolate and care for themselves at home.
For cases where in‐person care is needed, we will navigate patients to appropriate resources and encourage patients to “let them know before you go” so that the in-person care facility can direct them appropriately and minimize potential exposure for others.
As the COVID-19 outbreak unfolds, our commitment to providing high-quality care has never been more important. Virtual care is recommended by the CDC as the way to get care and advice and help avoid exposure and spread of potentially contagious viruses.
When should I use your services? What are wait times like?
The need for our care has never been greater and providing care in your moment of need is our highest priority. As a result, you may experience extended wait times.
If you have a fever or feel feverish, have cold-like symptoms or flu-like symptoms, or feel run-down, you should contact us. If you are experiencing shortness of breath or difficulty breathing, then you should call your local doctor’s office to request an in-person visit. Shortness of breath–having trouble breathing–is a more severe symptom that requires an in-person evaluation.
The fastest way to receive care is to request a visit on the mobile app or online. If you’re a new member, set up your account and complete a brief health history.
Teladoc does not write lab orders for COVID‐19 testing. When our doctors identify a COVID‐19 suspected case, we advise individuals to call their local doctor or their state’s public health hotline to verify test availability and to “let them know before you go” so that the in-person care facility can direct them appropriately and minimize potential exposure for others.
Testing availability varies by community and many health departments and health systems are prioritizing testing for patients with the greatest risk of COVID‐19 complications or greatest risk of spreading to others.
Individuals vulnerable to COVID-19 are patients older than 50 years or patients with chronic diseases such as heart, lung, kidney, and diabetes, or who are immunocompromised.
Children do experience the same symptoms as adults do with COVID-19. However, at this time, we are seeing that children’s symptoms seem to be milder. Children with chronic diseases such as heart, lung, kidney, diabetes, or who are immunocompromised, are at higher risk for complications due to COVID-19.
Teladoc works with many Medicare Advantage and Medicaid managed care plans but is not a provider for Medicare fee for service or Medicaid fee for service. Contact your health insurance provider to learn more about your benefits and to see if you have access to Teladoc.
We’re here to support you
If you think you have coronavirus:
- Contact us. We will advise you on what to do next. See our frequently asked questions below for how we handle COVID-19 evaluations.
- Call ahead before going in person to any doctor’s office.
- Don’t go to your local emergency room for COVID-19 testing. The ER is only for those who need the most critical care.
In a continuing effort to alleviate taxpayer stress from the COVID-19 pandemic, another piece of federal legislation will provide relief in several categories. The Stimulus Bill, also called The Coronavirus, Aid, Relief and Economic Security (CARES) Act or H.R. 748, was passed by the House and signed on Friday, March 27, 2020. Below are some of the most pertinent sections for financial professionals and their clients (not intended as legal advice):
Temporary Waiver of Required Minimum Distribution (RMD) Rules
The CARES Act waives RMDs for calendar year 2020 for Defined Contribution (DC) plans, including 401(k), 403(b), 457(b) and IRA plans, allowing individuals to keep funds in their retirement plans. Under current law, individuals generally at age 72, or those that turned 70 ½ in 2019 or before, must take an RMD from their DC plans and IRAs.
If a client has taken an RMD within the past 60 days, the RMD would be eligible to roll back into the plan. Typically, RMDs are not eligible to be rolled over in a year in which an RMD is required. However, since no 2020 RMD is required, a 60 day rollover is an option. We do not yet know what this means for individuals who took 2020 RMDs outside of the 60 day window, but expect to receive additional guidance from the IRS and will pass this along when we know more. In addition, as we hear more from our clearing firm partners on how this will affect Pershing and FCCS accounts, we will post that information on our COVID-19 Clearing Firm Updates Page.
H.R. 748 also waives the 10% early withdrawal penalty tax under Internal Revenue Code Section 72(t) on early withdrawals up to $100,000 from a retirement plan or IRA for an individual:
- who is diagnosed with COVID-19;
- whose spouse or dependent is diagnosed with COVID-19;
- who experiences adverse financial consequences as a result of being quarantined, furloughed, laid off, having work hours reduced, being unable to work due to lack of child care due to COVID-19, closing or reducing hours of a business owned or operated by the individual due to COVID-19; or
- other factors as determined by the Treasury Secretary.
The Act doubles the current retirement plan loan limits to the lesser of $100,000 or 100% of the participant’s vested account balance in the plan. Individuals with an outstanding loan from their plan with a repayment due from the date of enactment of the CARES Act through Dec. 31, 2020, can delay their loan repayment(s) for up to one year. The legislation allows retirement plans to adopt these rules immediately, even if the plan does not currently allow for hardship distributions or loans. This provision requires that the plan be amended on or before the last day of the first plan year beginning on or after Jan. 1, 2020.
The American Retirement Association (ARA) has put together FAQs outlining the above changes, available here.
The CARES Act provides the Department of Labor (DOL) with expanded authority to postpone certain deadlines under ERISA. This means that the DOL could delay such timelines as Form 5500 filing, plan restatement deadlines, etc. We will continue to update you as additional changes occur.
Small Business Relief
The Act also provides relief to your small business clients provided they meet certain requirements. The program, which is available to businesses with less than 500 employees that do not lay off employees during the crisis, is in the form of $350 billion in partially forgivable loans. Provisions of the program include a 50% refundable payroll tax credit on worker wages to retain workers, a delay in employer-side payroll taxes for Social Security until 2021 and 2022, looser net operating loss-reduction rules, and an expansion of rules that allows sole proprietors and other self-employed workers to be eligible for the expanded unemployment-insurance benefits the bill provides. Loans under the program will be up to $10 million per employer depending on payroll, and will carry an interest rate of up to 4%. If the business uses the loan funds for the approved purposes and maintains the average size of its full-time workforce based on when it received the loan, the principal of the loan will be forgiven, meaning the company will only need to pay back the interest accrued.
By: Ryan Nietert, CFP, ChFC, CLU. Oakcrest Capital March 30th, 2020
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