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Time to review benefits 4 MoneySmartLife strategies to do now

9/30/2019

GRAPH Employer Costs for Employee Compensation

Most employees unnecessarily leave money on the table when it comes to their compensation by not maximizing their employer-provided benefits. According to the BLS, 30% of your compensation is benefits. Let’s look at some strategies to get the most out of your benefits for the rest of this year.

But first a rant about paid vacation days. I realize that 1 in 4 American workers don’t get any paid time off at all. The rest get paid vacation “yet only 51% of paid vacation days are used! More disturbingly (if not surprisingly), 61% of those who do take vacation are “working while on vacation.” Americans left 768 million days of paid time off unused last year, according to research released by the U.S. Travel Association. The study found that 55 percent of Americans did not use all of their paid vacation time.” Why would you do that? Seriously, ask yourself, “why would I do that?” What are the short/long term benefits of this behavior?

Here is what to do for the rest of this year. The best time to do this is around October 1. This will give you flexibility before that end of the year time crush everyone experiences. Also, it gives time for any changes in your withholding strategies to take effect and return the expected benefits. Of course, these strategies can be implemented anytime.

Verify the status of deductibles and co-pays for health, vision, dental, prescription insurance plans. You can either move purchases into this year or defer them to next based on your deductible status. Make sure you utilize the full benefits by having physicals, wellness checks, dental x-rays, and eye exams. It pays to stay healthy. A penny spent on prevention is better than a dollar on a cure. You never want to hear from a doctor “if we had only caught it sooner,” when you have health insurance.
Review your Health Savings Account (HSA) and Flexible Spending Account (FSA) balances. Schedule provider appointments and make qualified purchases to use available funds now before the year-end crunch. Familiarize yourself with what are eligible purchases, such as OTC medications and aids, prescription vanity sunglasses and contacts, cosmetic dentistry and massages, etc. You’ll be surprised. Since these accounts have a "use or lose" provision, spending all the money just makes sense and cents.
Review your tax withholding exemptions. It may be time to increase them if you are expecting a large refund. This will give you an immediate increase in take-home pay and a smaller refund. Be sure to check with your tax preparer before you do this. Contacting them at this time of year will allow them to help you set a strategy for the rest of this year and the next. It also a slower period for the tax preparer which should help them focus on your strategy.
Decide what to do with remaining vacation days. Use, lose, or get paid? Based on your employer's policy, your options may be more limited. So decide now. Not taking the time off that you have earned is like giving your employer a rebate on your wages. That is a great move if you actually think your value is less than what your employer agreed pay you. Taking time off increases job productivity and is good for you.

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5 Things to Do to Prepare for the Coming Recession

9/22/2019

Aggressively save money now. Cash is King during a recession. Have as much of it on hand as prudent. Build your emergency fund. This prepares you to withstand “stuff happens” and seize the opportunities a recession always provides.
Layup 30 days of food for your household. A loss of income can be softened by knowing how the family is going to eat. Having food on hand will allow using your money on other things. Start by setting aside 3 days, then 7 days and finally 30 days. This food store is also used for disaster preparation and recovery due to weather events, natural disasters, and non-economic factors. Having a food reserve on hand is a MoneySmartLife strategy. This isn’t extreme prepping but it is being prepared.
Start a profitable side hustle. The loss of income is how most working-class families are impacted by a recession. That loss of income, if sustained, also causes a loss of wealth. The loss of wealth has a more enduring impact and must be avoided. The best way to do this is by having multiple streams of income. Make sure that your entrepreneurial endeavors are recession-proof by providing products or services torecession-resistant businesses and their employees.
Understand the difference between "wants" and "needs," then spend accordingly. Wants and needs are different for everyone. They are subjective and often emotionally driven. Despite those individual differences, everyone still spends in both categories. You may need a car to maintain your income. But the kind of car you purchase, beyond reliable transportation, is more a function of your wants. You know it’s a “want” rather than a “need” if you spend time justifying or rationalizing the upgrade.
Maximize your credit score. Excellent credit will allow you to take advantage of recession heightened sales incentives and lower interest rates. Both borrowing and buying become cheaper in a recession. Having excellent credit will allow you to access these credit-driven opportunities. Move your credit score up above 775 strategically and on purpose. During a recession, having and managing credit cards can be a component of your safety net. If your score is bad or takes a hit, start the recovery process now.

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Holiday Overspending Isn't Inevitable

9/16/2019

The retail-commercial complex are like the Borg. relentless

Many household budgets are still in recovery from '"back to school" spending. Some of us don't even want to hear anything about money right now, especially spending more of it. But now is the time to prepare for one of the biggest challenges to your family finances, the Holidays' spending.

The retail-commercial-complex is preparing to launch all-out massive assaults on our minds, money, and happiness. Buy,buy, buy.... "Resistance is futile. Assimilate or be destroyed."
Here are three things you can do.

BUY MEMORIES NOT THINGS.
It’s almost impossible not to spend money in the USA during holiday time because of the opportunities, the social approval and the messaging to do so are limitless. It now starts with Halloween in early October. Followed immediately by Christmas and its’ greedy spawns: Black Friday, Cyber Monday, Small Business Saturday, Doorbusters, after Christmas clearance sales, etc. It finally winds down in very early January. About 94 days of hyper-consumerism and conspicuous consumption run amok.

Americans spent $707.5 Billion during the holidays in 2018. You are not immune. Since you are going to buy something anyway, buy something that lasts. Most people remember experiences longer than things. Is the preponderance of your fondest memories experiences or things? Special experiences with friends and family will be treasured by both the Giftee and the Gifter. Remember experiences don’t just have to be good to be memorable.

HAVE A PLAN BEFORE THE SEASON BEGINS.
Don’t go into this financially hazardous season unprepared. Have plan. Decide how much you will spend for the holidays. People spend money during the holidays on food for celebrations, eating in and out, decorations, gasoline for holiday-related travel to events, errands, and visits.

These expenditures are over and above the normal monthly spending required. The average American family spent over $800 in 2018 on such items. Oh yeah, don’t forget the money for gifts.

It is important that you take control of your spending decisions. If you don’t, your spending decisions will control you. Holiday hangover debt is never fun and last longer than the one from that great New Year’s Eve party.

Now that you decided how much you are going to spend. The next step is to decide how you are going to spend it. Will you use only cash or will you borrow from credit cards? If you have to borrow for holiday spending, you need to make sure it is not financially self-defeating. You also can make additional income to cover your holiday spending plan.

6 Things To Consider When Planning Your Holiday Spending

STICK TO THE PLAN.
Now that you have a plan. Stick to it. Believe me, that is far, far easier said than done. Because of the aforementioned messaging and social approval, it is HARD NOT to impulsively spend money during this time of year. Try as you might, you just get worn down and succumb. Let’s face it, buying stuff feels good. That’s the part of consumer psychology that retailers and advertisers have mastered and prey on.

Start implementing your plan early. That could include researching planned holiday purchases or buying before the holiday rush. Perceived time constraints can add to the holiday stress of gift-giving and food preparation forcing bad spending decisions. Look for seasonal employment to cover additional expenses.

Here are 10 Tips For Cutting Your Holiday Spending.

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Equifax credit data breach What you should know and do Now

9/10/2019

In 2017 Equifax acknowledged a data breach that affected about 148,000,000 Americans of the 209,000,000 Americans 18 years and older. The data breach released Personally Identifiable Information (PII) such as:

Names
Social Security numbers
Gender
Birth dates
Addresses
Driver’s license numbers

Ouch, that hurts! Since more than 70% of credit eligible adults data files were compromised, it would be wise to take protected yourself.
What you must do now since Equifax has set a deadline of October 15, 2019.

Check to see if you were affected. If so, file your claim. Equifax changed some terms recently, so check again even if you are sure you previously filed a claim. Also, it is wise to all family members regardless of age while you are at it.
Check your credit reports from all three major bureaus for changes in your file. Be mindful of recent inquiries, other addresses and other names not just the tradelines in the file.
Check your credit statements for charges you don’t recognize.
Change vulnerable (read ALL) passwords for online, ATM, credit card accounts, etc. While you’re at it, use the latest cybersecurity password best practices.

Other things you can do.

Get credit monitoring as part of the data breach settlement. For most people, this will probably be the best fit. It's simple easy and adds another layer of protection to your data. It will also be free for up to six years. The problem with credit monitoring as a cybersecurity strategy is that it is reactive. It tells you after the fact. There are proactive strategies you can use also.
Place a fraud alert on your credit file. A fraud alert requires potential creditors to take additional measures to verify your identity when they receive an application. You have to go to one of the 3 major credit bureaus to do this. But once you do that bureau is required by law to contact the other two. And they must place fraud alerts in your file also.
Consider using a credit freeze. This will totally lock down your credit report. It is more of a nuisance since you have to contact each of the three credit bureaus individually.

Don't delay. Protect yourself and your family from this data breach.

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Time to review benefits 4 MoneySmartLife strategies to do now

5 Things to Do to Prepare for the Coming Recession

Holiday Overspending Isn't Inevitable

Equifax credit data breach What you should know and do Now