The seller did get a follow up call from the same charming lady the next day, insistent on an answer. Again he suggested she take her cut out of the total. Thus, the “charm” ended there, and so did the transaction. Chances are there was no buyer, possibly no auto marketing group… just a way to pick a pocket.
It could even be someone who has been a trusted adviser in the past, such as an accountant. Don’t assume “Mary would never do that to her mother.” Sometimes family members feel entitled to money they expect to inherit someday. Or they may have found themselves in financial difficulties and see Mom’s savings account as a way out.
Since you were named as the beneficiary on your uncle’s life insurance policies and since you survived your uncle, those life insurance proceeds are legally yours regardless of what the will states. If your uncle wanted his will to control the disposition of those life insurance proceeds, then he should have named his estate as the beneficiary and not you.
One major downside of real estate is that it is highly illiquid. Defaulted properties have turned them into landlords with all sorts of potential costs from maintenance to updating to the necessity of insuring against disasters.
The FTC warns, thieves will go to great lengths to appear legitimate in order to win your trust. Thieves would have you believe they have no self-interest and are thinking only of you, when in reality they have a great deal to gain and you have everything to lose. Here are some of the schemes the FTC has run across:
If your Part D plan offers a preferred network pharmacy and you use it, you could save hundreds of dollars each year on co-pays. But only about one out of four people on Part D know if their plans have a preferred network pharmacy, and even fewer have made the switch. How much could you save on your co-pays? Up to 75%.
However, if she were named as your agent under a durable power of attorney, not only would she be able to write checks on your behalf, she could act on your behalf in a variety of other areas, including such things as filing your tax return, signing contracts on your behalf, buying or selling stocks or investments and signing closing documents, including a deed, if you wanted to sell your home.
A few days earlier, my e-mail password had been hacked, and though I was annoyed, I failed to realize the seriousness of the situation. I quickly changed my e-mail passwords and restored my access, but if I’d understood how serious it was to have thieves in my e-mail, I would have done more, sooner.
Don’t accidentally sign away your title. This may sound like a no-brainer, but there are companies that will claim to be able to halt a foreclosure process if you sign their form, allowing them to act on your behalf. Don’t believe it.
A husband and wife who retain assets in joint names do run the risk of dying in a common accident, and in that event, those assets would have to be probated, which could have been avoided if the trust owned the assets from the outset.
Finally, you can set up a Roth IRA with after-tax money. This allows you earn interest and capital gains on the investment without paying any more tax. Thus, it reduces your future tax. Uncle Sam likes to give you choices: pay now or pay later. Just pay.
One study published last year showed that if you fund your own retirement until you turn 70, your money could last up to 10 years longer than if you start taking Social Security at age 62. That’s partly because of the tax you could end up paying on your Social Security benefits.
Here are the 10 states that will tax you the least, and leave you the most spending money. Every state on this list is considered a tax haven because each one exempts your Social Security benefits from taxation, and some charge little or no state income tax on your other income.
While fewer in the older generations are out of work, for those who do lose their jobs, it takes longer to find re-employment. Among those age 25-34 it takes an average of 36.4 weeks to find a new job. While for those 55-64, it takes an average of 54.6 weeks to be re-employed.
A further complication is that you own real estate in two states other than where you live, and if probate is required due to one of the events mentioned above, then probate will also be required in each of those separate states for that real estate.
The worse the economy gets, the bolder and more clever thieves get. Credit monitoring services that alert you when someone messes with your credit can be pretty effective. But a credit freeze is probably the most affordable way to limit the ability of thieves to get at your money.
If you think your landlord is responsible for your belongings in the event of a problem, think again. Landlords are generally responsible for the property, not your belongings. A renters policy covers not only your possessions, but also additional living expenses in the event you have to move out of your house.
If you want to avoid having the death benefits of any life insurance policy you purchase taxed as part of your estate, you need to set up a separate irrevocable trust for the purpose of purchasing and owning that policy.
“If you are an insurer and there is a group of smokers you don’t want in your pool, the ones you really don’t want are the ones who have been smoking for 20 or 30 years,” according to Karen Pollitz, now a health insurance expert with the Kaiser Family Foundation.
If you don’t establish boundaries from the start, the emotional tax could be worse than the actual tax the IRS takes. Generosity is a good thing, but don’t allow pressure and manipulation to make your decisions for you. You don’t want to resent your own generosity.
In some states, you may be responsible for the medical and long-term care bills that your spouse accumulates...Some older couples make the decision to remain unmarried so they can avoid the possibility of having to assume this responsibility.
In some states, those creditors may be able to garnish other income and assets you may have, such as wages from a part-time job. But they cannot garnish your Social Security benefits, Supplemental Security Income (SSI) veterans benefits, federal employee and civil service retirement benefits, or benefits from the Railroad Retirement Board Administration.
Since the value of your estate is well below the federal estate tax exclusion amount, there is no need for you to engage in estate tax planning at this time and the separate estate tax planning trusts you prepared in 2003 are probably no longer necessary.
We combined our assets from the beginning. Despite this, my stepdaughter seems to think she’s going to get everything in our house when we die. Could some of our “stuff” really be hers? I don’t want to ask my wife and pick a fight.
If you have a Roth IRA, you are not required to take distributions after age 70 ½. However for traditional IRAs, you must take a required minimum distribution (RMD) every year, or face a harsh 50 percent penalty on the amounts you should have taken.
When you are renting, you are paying the landlord a profit, and you may not be able to have a pet. But you won’t have to deal with maintenance and you won’t tie your money up in an asset that can be hard to sell. There are good arguments for both sides, and the decision can be complex.
As a final warning, beware the siren call of life insurance as a "solution" to college financing. The pitch is that you can sequester your assets in life insurance to qualify for more college aid. These schemes rarely work out in the long run – except for the agents who sell them.
So imagine if you were standing in line, with your debit or credit card in your back pocket. All someone with the right device would have to do is casually pass this machine within one foot of your pocket, and boom, your credit may be stolen.
Many credit repair services are legitimate but the truth is they can’t do anything you can’t do yourself, for free. Make timely payments and keep your overall credit use low and do this without fail every month, and you will accomplish the same thing a credit repair service will charge you for.
In some states, certain assets cannot be touched by creditors. That is, they will not become part of probate (probate is the process of paying claims against your estate after you die). These assets can include life insurance proceeds, retirement benefits, and possibly real estate if the spouse is a co-owner on the mortgage.
The differences among financial planning fee structures depend on what they are offering. Some insurance agents, stock brokers, or accountants will “run your numbers” and provide a plan which takes advantage of their particular offerings as part of the solution. There may be no upfront charge because they are making money on commissions and fees.
You’re probably gearing up for the holidays and don’t want to think too much about your investments. But don’t wait too long. In the final weeks of the year, financial institutions get swamped with requests for investment changes. To deal with that, many of them set deadlines for making those requests and you may miss your opportunity.
Make sure all of your insurance policies are easy to locate if a disaster – such as a flood or fire – occurred. The time you have to file a claim may be limited. Even if you know exactly where your papers are, someone else needs to know in case you cannot be consulted.
Turn the bill over. Hard to believe, but thieves sometimes work hard to make one side of a high-value bill look genuine and do little or nothing to the backside.
If you provide your parent with regular financial support, you may be able to take a dependency exemption for him or her. In 2012, that exemption is equal to $3,800.
I retired a few years ago and my wife, the main breadwinner, intends to retire at age 70. I’ve called our local Social Security office a couple of times and even been there once, but I always get different answers. They seem to know how to assign the best benefit now, but not what’s best in the long run.
Banks and other financial institutions do not place recorded calls, offering to lower your interest rate or change the terms of your account. Your best bet is not to answer. If you do answer, do not follow the instructions to push any buttons. If they leave a message asking for a call back, just delete the message.
Appliances rarely break down within the time covered by the extended warranty, and if they do break down, the cost to repair them is often comparable to the cost of the extended warranty. General wisdom says if the extended warranty costs more than 30% of the item itself, it’s not worth it.
First, the FTC notes that market research companies do not go around pasting ads everywhere, and they certainly don’t send unsolicited e-mail. Scams will try to lure you in by promising you can earn a good living, eating in upscale restaurants, taking luxury trips as part of the job, getting reimbursed for buying nice items you get to keep.
However, reverse mortgages are complicated and expensive. They cost many thousands of dollars to set up, and interest owed compounds throughout your lifetime and becomes a liability in your estate. If your spouse or partner is not on the deed, he or she could be evicted after you die.
Nearly half of those surveyed pointed to the stagnant economy as the reason for the need for financial support. “A third of grandparents are helping monetarily in spite of their belief that such assistance is having a negative impact” on their own financial situation.
Remember, these are only averages. Some states are less, but some are shockingly higher. If you are a resident of Alaska and require nursing home care in 2012, expect a bill upwards of $232,000 for a private room. To see what the average costs are in your state, go to your Internet browser and type in “Genworth Financial, Cost of Nursing Home, 2012.”
But if the homeowner doesn't have enough income to keep making these payments, he could lose the house. Nearly 10% of reverse mortgage borrowers are at risk of foreclosure, according to a study by the Consumer Financial Protection Bureau.
Many people share in this misconception that by virtue of being married, each spouse automatically can handle the other spouse’s affairs without any type of written authorization. The fact is, in most cases that is not so.
Homeowners, often seniors or persons with very low income, miss a property tax payment or other municipal obligation. All states have laws permitting local governments to file liens in order to collect unpaid amounts. These tax liens take priority over all other liens, including mortgages.
Charities solicit donations by phone. Political groups and candidates solicit by phone, especially now in the run-up to a national election. And survey takers are always around. These exceptions are the rocks under which thieves and scammers hide.
Let’s face it. There simply is no inexpensive option when it comes to health insurance, but options do exist. Before you jump into Medicare and before you turn in your resignation in favor of retirement, sit down with your spouse and find out how you can get the coverage she needs without draining your nest egg.
The last resort may be the federal Pre-Existing Conditions Insurance Plan (pcip.gov), available nationwide. It was created as part of the health care reform law, as a bridge to get you to 2014 when most of the health reform bill will be fully in effect.
First of all, you need to state in your last will and testament, as well as any trust you prepare, that you are intentionally omitting your daughter as a beneficiary, i.e., intentionally disinheriting her.
"...beginning immediately we are going to start charging you a quarterly maintenance fee for this account, equal to about six times your annual interest take. And we are going to charge you a monthly maintenance fee on your non-interest bearing checking account, so that our corporate leaders can continue to lead a lifestyle that you can only dream about."
With even a few of those facts a scam artist can put together enough information to impersonate your grandson for the few seconds it takes to terrify you, and get you to send rescue money. And don’t think that will be the end of it. When they find a willing victim, they will probably call back asking for more.
Further, upon the completion of probate, those assets will be distributed pursuant to state law. Consequently, your uncle's desire for you to keep a portion of his estate and then give the rest to charity cannot happen if he does not prepare a will or a trust.
If you are tempted to respond, keep these points in mind: in this economy employers everywhere are struggling, so does it make sense that any company, anywhere would offer high pay for little work, to people without exceptional skills?
Because the annuity is purchased with before-tax funds, your distributions are taxable when they are received. If you believe taxes are headed upward, of course that means you’ll pay higher taxes when you receive the money than you would on the same funds now.
If you are on a fixed income and get a check only once a month, try to arrange your credit card payments so that you are always a month ahead. If you have several credit card bills, start by getting one at a time on an early pay schedule, till you’re ahead on all of them.
Further, you should contact all of your banking institutions, as well as your physicians, for the purpose of advising them that you have revoked those durable power of attorneys and then provide them with copies of the new ones for their records.
Their accounts are identical except for the fee charged: Investor 1 pays a $199 per month flat fee while Investor 2 pays 1.5% annually, paid quarterly. With a 7.74% compounded annual rate of return, Investor 1 can retire in 20 years, but Investor 2 must wait 23 years and three months to reach the $1 million goal.
This is frequently a concern of clients, i.e., not wanting to hurt their children's feelings by not naming one of them as a fiduciary in their estate planning documents. My first recommendation is to set aside any concerns regarding the child's feelings and instead focus on which child is best suited to act as your fiduciary in those various capacities.
Even people who make an earnest effort to do everything right, tax-wise, can end up under the IRS microscope. What should you do? First, take a breath and read the full notice.
The IRS states positively that, if they want to talk to you personally, they will not do it by email. This is number one on the list of warnings they issue to prevent you from falling victim to identity theft, so take it to heart.
If you close accounts with zero balances, you may hear a sound like distant thunder. That would be the sound of your credit score crashing.
The Bureau of Labor Statistics reports that since 1990, the number of seniors returning to the workforce has nearly doubled. If going back to work appeals to you or has become a necessity, you need to know how a paycheck will impact your benefits.
Women’s defined contribution plan balances of only 60 percent of men’s average balances is especially concerning because women live longer than men and are more likely to have work disruptions for caregiving that hinder their capacity to save.
In 2010 alone, more than 540,000 Social Security paper checks were lost or stolen and had to be replaced, at great inconvenience and distress to the recipients. Under the new paperless system, the possibility of a lost or stolen check is virtually eliminated.
For example, if the home at the time of your death is worth $150,000, your daughter's tax basis in the home will be $150,000 and if she turns around and sells the home for that same amount, she will have no capital gains tax to pay and she will not have to wait for two years to sell the home.
If you know what to look for, the scams are not hard to recognize. They have many aspects in common, like the promise of high pay for few hours of work and no skills or experience required. In reality, few if any businesses post notices recruiting people to fill jobs like that.
Consumers love apps, widgets, and any faster, newer, cooler technology-related gadget. So do thieves. In fact, increased use of online banking is like waving a red flag that motivates thieves to find even more ways into your computer.
Trustworthy funeral homes will have no problem complying with these rules. On the other hand, the less trustworthy funeral homes may try to manipulate you to believe that cost should not matter at a time like this. Of course it matters!
If you could do it then, you can do it now -- only a little differently because you can’t get a penny for bottles anymore because they are all disposable, and the energy might not be there to deliver papers.
For instance, if the bulk of your $5,000,000 estate is tied up in retirement type investments, i.e., IRA's, 401k's, tax-deferred annuities, etc., those types of assets typically would not end up in trust; instead, you would name your children as the beneficiaries of those proceeds at your death.
Another step you can take as a protective device and one I always recommend to my clients, is that you make sure that whoever you have named as your agent does not have access to a copy of the power of attorney until it needs to be used.
You have to understand that a trust only helps a person's estate avoid probate if the trust in fact owns that persons assets at his or her death. If the individual dies with assets in his or her name alone, then those assets generally need to be probated.
Before you hand over your tax information -- which includes your Social Security number and those of your spouse and dependents -- to someone you barely know, do some checking.
Whether or not you have to file, it might be a good idea. The deciding factors include your age and gross income and filing status. Persons age 65 or older are allowed to have more gross income than younger taxpayers before they are required to file.
SCSEP pays the wages, but after the initial training period, some of these seniors are hired by the charities they trained with. Some go to work for other charities where they will work for several months while acquiring new skills. But the ultimate goal is for the seniors to be placed in good jobs in the public or private sector.
Also ask the agent what the effect of inflation on your policy will be. There could be a long gap of time between purchasing the policy and using it. Obviously benefits that are eaten up by inflation will be of little use.
But there is always the chance that you won't wake up tomorrow or that an accident or sudden illness will make you unable to speak for yourself. If that should happen, could someone step in for you?
You can hit the ground running in 2012 by slowing down long enough to take stock of where you are. Here are eight areas of your life to ponder.