If you explore any information about the stock market, you’ll be hard-pressed not to trip across an article talking about a FAANG stock or two. These tech behemoths are always movers and shakers, at times for better, at times for worse. But when you see the price tags associated with these investment options, you may be wondering, “Is it too late to invest in FAANG stocks?” If you fall into that category, here’s what you need to know.
When you choose items to go into your wallet, you typically have a few goals in mind. Usually, the first priority is to ensure certain necessary items are accessible, like your driver’s license or debit card. However, some people also carry around additional items, predominately because it seems convenient. The issue is, some things are incredibly risky to keep with you, leaving you open to identity theft, fraud, or other hardships if you misplace your wallet or the items fall out. If you want to make sure you’re as protected as possible, don’t keep these 7 things in your wallet.
Identity theft is much easier for a fraudster to pull off if they have access to your Social Security number. Since your Social Security card isn’t something you regularly use, carrying it around means you’re taking an unnecessary risk.
Ideally, your Social Security card should be stored in a safe place, such as a fireproof safe in your home or a safe deposit box at a bank. That way, it is accessible on days you do need it – such as if you have to present it to complete an I-9 verification for a new job – but won’t easily fall into the hands of someone else.
Technically, you also shouldn’t carry any documents or notes with your Social Security number on them, especially in your wallet. Your ID card or driver’s license contains a lot of your personal information. If you lose your wallet and it also has your Social Security number on a piece of paper inside, you’re making it particularly easy for them to steal your identity.
The same goes for passport cards. While they are convenient for border crossings, they also contain a ton of personal information. Unless you’re planning on crossing a border or need it for an I-9 verification, leave it securely stored elsewhere.
Carrying credit cards that you don’t use frequently creates an extra level of risk. Even if you notice your wallet is missing quickly, it takes time to contact every issuer to let them know your card is missing. That could give a criminal enough time to use your card before you get it canceled.
While you may want to keep your main credit card and debit card with you, reconsider any extras. For example, you may want to lock up your store cards in a fireproof safe, only removing them when you plan to shop at that store. Not only is that safer, but it could also reduce the urge to impulse shop, which could make it easier to keep your budget on track.
Some people struggle to remember their debit card PIN and various account passwords. While keeping it on a piece of paper might seem convenient, it also means that someone else gets access to it if you lose your wallet. Thieves will have an easier time using your card, as they can enter the PIN directly, or could the passwords to break into your bank accounts.
Similarly, writing your PIN on the back of the card is a no-go. You never want a copy of your PIN and your card in the same place, as that makes it much easier for someone to use the card without your permission.
If you have trouble remembering, you may want to use a password keeper app. That way, you only need to remember one password, and the rest will be securely encrypted inside the app.
A check – whether blank or filled out – contains a lot of information that a fraudster could use to steal money from the connected account. Along with the accountholder’s name and address, the routing number and account number both appear on paper checks. That could be enough detail for a criminal to initiate a transaction, allowing them to take money out of your account.
If the check is blank, that’s even riskier. If you drop your wallet and it contains an ID card, driver’s license, debit card, or another item with your signature, the person who finds it could use that as a reference. Then, they could write themselves a check, fake your signature, and get the money that way, too.
If you’re a fan of the envelope budgeting system, you may get in the habit of carrying large sums of cash. While that may be necessary if you’re about to handle a major shopping trip, it isn’t wise to walk about with big amounts of money when you’re not about to shop.
Instead of keeping all of the envelopes on you at all times, leave them secured in a fireproof safe. Then, remove only the ones you need when you’re about to shop.
Additionally, while it might be less comfortable, you may want to avoid carrying large bills, like $100 bills. If someone notices that you’re removing large bills from your wallet, that could make you a target. While having to carry a stack of $20s means a thicker wallet, it could be a wise move.
It’s important to remember that, unlike with credit or debit cards, there’s no fraud protection with cash. Often, if you lose your wallet and someone removes the money, recovering it is practically impossible.
Like cash, gift cards are hard to recover if they are stolen. As a result, it’s best not to carry any you aren’t planning on using that day in your wallet. That way, if you misplace your wallet, you don’t have to worry about their value being stolen.
Additionally, if you have the option of registering your gift card online, consider doing it. Usually, this process is required for online purchases, allowing the card to be associated with a physical address for traditional verifications. As an added bonus, it could make it harder for a thief to use your card, suggesting they didn’t manage to get their hands on your driver’s license or ID, too.
Without your zip code, they can’t make it through the verification process. However, if they do have your ID, they can input the right information while checking out. But that doesn’t mean that registering isn’t worth doing, as it could offer you a degree of protection.
While many people worry about what they’ll do if they lose their house or car key, keeping the spares – even the valet key – in your wallet isn’t ideal. If you do happen to misplace your wallet, the person who finds it can do more damage than just take your money. For example, they could use the address on your driver’s license or ID to locate your home, using the key to gain access. They could then keep an eye out for your arrival and take advantage of the spare car keep to steal your vehicle.
If you’re concerned about getting locked out of your home or car, your best bet may be to give the spare to a trusted friend or family member. Then, if you lose your keys, you can contact them for assistance.
Can you think of anything else people shouldn’t keep in their wallets? Share your thoughts in the comments below.
Read More:
As the year begins to come to a close, many retirees start to wonder if they will see a Social Security COLA increase. When payment amounts go up, it can be a boon for retirees on tight budgets, giving them a bit more breathing room and ensuring inflation doesn’t impact them too severely. If you are wondering if a Social Security COLA increase is coming in 2021, here’s what you need to know.
Every year, the federal government examines the Consumer Price Index (CPI-W), which is tracked by the Department of Labor, to determine if the cost of living has increased. When the CPI-W rises, it’s usually a mark of inflation, meaning that the prices of goods and services have gone up, overall.
When that occurs, Social Security recipients may receive a cost of living adjustment (COLA). Usually, this means their Social Security income payments go up by a certain percentage, reflecting the change in the CPI-W.
In 2021, around 70 million Americans who are receiving Social Security will see their benefits increase. Additionally, individuals who get Supplemental Security Income (SSI) payments will also see a boost.
The increase is set at 1.3 percent. That means, if a person is receiving $1,500 a month in Social Security benefits, their payment will likely go up to $1,519.50 in the new year.
When there is a Social Security COLA increase, the Social Security Administration sends out notifications in the mail to every recipient. In that letter, they share how much the person’s benefits have changed based on the COLA increase.
However, for those who want to find out faster, they can log into the mySocialSecurity portal and check their message center. There, they can see the same information that will appear in the mailed notice.
Using the portal can be an ideal option. The benefit information is available online in early December, while some may not receive their notification in the mail until later in December. Since knowing how much you’ll receive in Social Security can be critical for budgeting and planning, finding out as quickly as possible is often preferred.
As an added convenience, users can log into the portal now and sign up for text or email alerts. With those, they’ll receive a notification whenever a new document is available for viewing online. When it comes to the COLA increase, the notification will let you know as soon as the information is available for viewing, ensuring you find out at the earliest possible moment.
Yes, there are other Social Security changes going into effect in 2021. One of the most notable changes is the increase in the maximum Social Security benefit for workers who retire at full retirement age. The maximum in 2020 was $3,011 per month. In 2021, it will go up to $3,148 per month.
Additionally, the maximum earnings amount subject to Social Security payroll taxes is rising with the new year. This will impact working individuals and raises the maximum from $137,700 to $142,800.
The retirement earnings tax exemption will also shift. It’s set at $18,240 per year ($1,520 per month) for 2020 for those under full retirement age. In 2021, that will go up to $18,960 per year ($1,580 per month).
For those who’ve reached full retirement age (which varies depending on the year you were born), the exemption in 2020 was $48,600 per year ($4,050 per month). In 2021, that goes up to $50,520 per year ($4,210 per month).
There are also a few other increases that impact certain population segments. For example, there will be changes to the Substantial Gainful Activity (SGA) maximums in 2021. The thresholds will increase for non-blind and blind Social Security Disability recipients, as well as those in a Trial Work Period (TWP).
Other changes may also be coming in 2021. If you are a Social Security recipient of any kind, it’s wise to keep an eye on your online notifications and mail notices. That way, you can see if anything on the horizon will impact your benefits in the new year.
What do you think about the Social Security COLA increase in 2021? Do you think it’s enough, or do you think it falls short? Share your thoughts in the comments below.
Read More:
Most professionals spend time planning for the future. The issue is, not everyone considers what they would do if they were suddenly unable to work. Having your income disappear due to a disability could be earth-shattering. As a result, many begin to explore their long-term disability (LTD) insurance options. But figuring out whether LTD insurance is a good buy can be challenging. If you want to see whether securing a policy is a smart move. Here’s what you need to know.
Many households struggle to keep up with their mortgage payments. In some cases, uncertain financial times – like those created by the COVID-19 pandemic – are largely responsible. However, there are certainly other triggers that may make handling your payment difficult. That’s why understanding your mortgage payment grace period is so important. It lets you know how much time you have to manage your obligation before there are serious ramifications. If you want to learn more about the grace period for mortgage payments, here’s what you need to know.
First, it’s important to understand what a grace period is and what it isn’t. In the simplest terms, for mortgage payments, a grace period is a specific amount of time after your payment due date. As long as your payment comes in during that window, you typically don’t experience any repercussions for your payment technically being late.
For example, by getting your payment in before the grace period ends, you shouldn’t face any late fees. Additionally, the lender usually won’t ding your credit.
Now, you may or may not accrue interest on the unpaid amount during your grace period. Whether that occurs depends on how interest is calculated on your loan and whether the lender opts to delay charging interest on that amount until the grace period expires.
A grace period is an automatic benefit that is part of your mortgage agreement. Generally, you don’t have to do anything to take advantage of it, aside from ensuring your payment comes in before that time period ends.
However, it’s best to review your mortgage to confirm precisely how yours works. The grace period clause will outline if there are any steps you need to take, such as contacting your lender to let them know that your payment will be late or something similar.
Grace periods may seem like an odd thing for lenders to offer from a business perspective, as it prevents them from charging late fees the day after your payment is technically late. After all, fees can boost profits.
The trick is, many mortgage lenders are required to offer grace periods. Many states have laws designed to protect borrowers from late fees, including some rules that apply specifically to mortgages.
If a lender operates in a state with a grace period law, they have to offer one. If they don’t, they are breaking the law, and that can come back to hurt them.
However, there can also be other motivators for offering grace periods. For example, back when most people paid their bills by check, mail delays could make a payment seem late when it was actually sent out on time. Grace periods helped account for issues with mail delivery, ensuring borrowers weren’t unfairly penalized. While most people don’t pay by check today, it’s technically still an option available, so some lenders may maintain their grace periods based on that.
Similarly, grace periods can ensure that holidays don’t cause a payment to come in late. Banks generally don’t process transactions on weekends and federal holidays. If a person’s mortgage bill was due on a day when the banks aren’t processing transactions, it could make their payment seem late when it really isn’t.
Additionally, while most mortgages are due on the first of the month, people’s pay schedules may not align with that date. By offering a grace period, it gives borrowers a bit of flexibility, allowing them to send a payment when they receive their paycheck.
Precisely how long your mortgage payment grace period is depends on a few factors. Where you live plays a role, as local laws may determine the minimum length. Additionally, who your lender is matters.
Lenders can always choose to offer grace periods that are longer than state law requires, they just can’t make it shorter. As a result, not all lenders within a state use the same time frames.
However, with all of that in mind, a typical grace period lasts 10 to 15 days. If you want to know precisely how long yours is, you’ll need to check your mortgage paperwork, as it will be stated in a clause there.
In some cases, your grace period may also be noted on your monthly mortgage statement. Similarly, that information may be listed in your online mortgage account. But, if you don’t find it there, your best bet is to check your physical mortgage paperwork. If you can’t find the clause, then you may want to contact your lender directly and ask.
Once the grace period passes, there can be consequences for not making your mortgage payment. The most common ones are late fees and potentially a ding on your credit report.
Late fees – like grace periods – are part of your mortgage agreement. That document will say whether you owe a flat fee, a percentage of your mortgage payment, or another amount for being late.
If your payment is 30 days late or more, then your lender can report the missed payment to the credit bureaus. At that point, you’ll see a derogatory mark on your credit report and, likely, a decline in your credit score. That derogatory mark can remain on your report for as long as seven years, causing long-term harm to your score.
If you know that you can’t make the payment before the end of the grace period, contact your lender. Depending on your situation (the reason you are having trouble missing the payment), there may be assistance available that can help you avoid fees and damage to your credit score. For example, you may qualify for a forbearance, ensuring you won’t be charged fees, penalties, or interest beyond the usual amount for a specific amount of time.
Speaking with your lender allows you to learn more about your options. That way, you can make the right financial choices based on your circumstances and potentially save your home and credit score while avoiding severe monetary penalties.
Do you think the grace period for mortgage payments is long enough? Why or why not? Share your thoughts in the comments below.
Read More:
Figuring out if you should pay off your student loan debt early is surprisingly difficult. While there is typically a benefit to freeing yourself from a monthly payment, focusing extra money on your student loan isn’t always the best move. Depending on your situation, you may be better served with a different approach. If you’re wondering, “Is it a good idea to pay off student loan debt quickly?” here’s what you need to consider.
If you want to retire at age 50, then you have to use a non-traditional strategy. While you can certainly invest using traditional retirement account approaches – like a 401(k) or IRA – that alone isn’t going to work. Removing money from those accounts before you reach age 59 ½ could lead to monetary penalties, which isn’t ideal. As a result, you need to invest a bit differently, ensuring you have access to the cash you need. If you want to make sure you are ready for retirement at age 50, here are some tips that can help.
Traditional retirement accounts like IRAs and 401(k)s do come with some benefits, usually when it comes to taxes. You may be able to deduct your contributions or, if you go with a Roth, won’t have to pay taxes on withdrawals. Those can both be very big deals financially.
While you can’t pull the money out penalty-free until your at least 59 ½ in most cases, that doesn’t mean these shouldn’t factor into your investment plan. You can simply let these accounts grow until you do reach full eligibility age, allowing them to become a source of income later down the road.
It is important to note that there are also some exceptions that allow you to avoid the early withdrawal penalty. For example, if you do go with a Roth IRA, you do have the option of tapping into your contributions early. Since you paid taxes on that money, you can withdraw those contributions at any time. However, if you tap into the earnings, you will get stuck with the penalty.
There’s also the substantially equal periodic payments (SEPP) exception. With that, if you make early withdrawals from a qualifying plan, including an IRA or 401(k), in equal amounts over the course of five years (or until you turn 59 1.2), you won’t have to pay a penalty. However, if any of those withdrawals deviate from the others, you might end up triggering the penalty.
After you’ve covered your basic retirement contributions, it’s time to move onto a brokerage account. Here, you can invest freely. You can add as much money as you’d like and make withdrawals whenever you want. As a result, they can be a solid choice for funding the starting years of your early retirement, essentially covering the gap until you can tap into your retirement fund.
When you choose investments, there are two points you need to cover. First, as with all investing, diversification is your ally. It provides you with some protection against the unexpected, including financial downturns or company or sector struggles.
Second, you need to be as aggressive as you can tolerate. You are investing for a shorter period than if you were aiming to retire at a traditional age. As a result, growth needs to be a core focus.
Now, this doesn’t mean investing to the point that makes you uncomfortable. If the idea of going beyond an 80-20 stock-to-bond portfolio split keeps you awake at night, then it isn’t a good move for you.
However, if your comfortable with taking on some risk, then push it a bit. If 80-20 doesn’t work for you, then maybe 70-30 does. Just understand that growth needs to be a focus if you want to retire early.
Additionally, understand that being aggressive doesn’t mean being irresponsible. Do your research before you choose an investment. Focus on diversification and rebalance your portfolio when the need arises. The goal is to be bold but smart about your approach. If you need to adjust your ratio as you get older to remain comfortable, then explore that option.
As people age, their medical expenses tend to rise. As a result, it can be wise to plan for this eventuality, and a health savings account (HSA) can help you do that.
With a health savings account, withdrawals for medical expenses can be made as needed. What you don’t spend in a given year rolls over, so you can stash cash while you’re working, leaving it available for your post-retirement years. Plus, there are potential tax benefits, including deductible contributions and tax-free growth.
Additionally, if you have money in an HSA and turn 65, you’re free to treat it like a regular retirement account. You don’t have to worry about how you use the funds, as the account essentially starts to work like an IRA at that point.
Now, you can only open an HSA if you have a high deductible health plan. But if you’re in that boat, you might as well make the most of it and use it to plan for your future.
Do you have any other tips that can help someone invest for retirement at age 50? Share your thoughts in the comments below.
Read More:
When a company is publicly traded, it has a set number of outstanding shares. This limits the number of potential investors, as there is only so much stock to go around. Additionally, it can, at times, hinder a company’s ability to bring in money. However, businesses do have the ability to practically create more shares out of thin air. With a stock split, they can increase the total number of shares available. The move can be financially beneficial, but it also comes with risk. If you are wondering, “Do stock splits make sense in 2020?” here’s what you need to know.
Whether you’re currently retired or simply want to be prepared for the future. Figuring out how long your retirement funds will last is critical. That way, you know when you can safely leave the workforce, or if you need to make changes to retire on your preferred date. While determining the health of your retirement account is challenging, it can be done. If you want to know how long your retirement funds will last, here’s what you need to do.
If you’re close to retirement, it’s wise to do a solid estimate of your post-retirement expenses. Ideally, you want to create a reasonably accurate budget. Along with any debts or recurring bills, factor in fluctuating costs – like groceries – as well as entertainment, travel, hobbies, or any other places you may want to spend money.
However, you don’t want to stop there. You also need to take a look at all of your sources of retirement income. For example, you may want to factor in Social Security. If you head to the mySocialSecurity portal, you can take a look at how much you’re likely to receive, allowing you to factor it into the equation.
By getting a grip on your expenses and all of your sources of income, you can determine how much you’ll need to withdrawal each month or year from your retirement account. That way, you can move onto the next step with greater ease.
There are a number of retirement calculators that will help you determine how long your money will last. Usually, all you need to know is the average annual rate of return on your account, the balance at the time you plan on making withdrawals, and how much you want to withdrawal each month or year. It’s also helpful to know your marginal tax rate if the money you pull will be taxable.
At times, you may need to do some additional math to determine how much you’ll have saved before you retire. If so, you can try the calculator by Dave Ramsey to get an idea of the potential value of your retirement account.
Beyond that, if you’re looking for a simple place to start, the calculator by Mutual of Omaha is a solid option. It’s easy to use and produces a simple chart. The only drawback to this one is that it only goes out for 30 years. If your retirement savings will outlast that, then you may need to do a second calculation to get the exact amount of time before it’s gone.
However, if you’re savings is going to last you more than 30 years, and you’re not retiring early, you could likely assume that you’re fine. But it may also be wise to redo the calculation, adjusting certain parameters to ensure you aren’t being overly optimistic.
For example, reduce the expected Social Security growth rate and the expected return on your retirement account. That way, you can see how long it will last if things don’t go as well, giving you another perspective on the staying power of your retirement fund.
Do you have any tips that could help someone figure out how long their retirement funds will last? Share your thoughts in the comments below.
Read More:
At some point, every would-be or current investor hears that they should consider adding gold to their portfolio. Gold often has a substantial amount of allure, a psychological impact that affects how people perceive its value, stemming back to ancient times when it was highly coveted. It’s also viewed as a form of safe haven, an investment that remains stable even during tumultuous times. If you are wondering what makes gold so valuable, and if its value is deserved, here’s a look at it from an investment perspective.