According to Consumer Reports the break even point is 3 years if you pay more for a hybrid vehicle compared to a similar conventional model based on fuel savings. This calculation is based on gas at $4.50/gallon and 12,000 miles per year.
October 26, 2022
After the Death of Your Spouse: Next Financial Steps for Surviving Spouses
As a surviving spouse, you might find yourself overwhelmed by all
the administrative and financial to-do items that you have to handle
soon after the death of your spouse. There's a lot to do, much of which
you've never done before. And you're supposed to get it all done while
grieving.
This book, by Mike Piper, CPA, walks you through it, in plain language.
Many surviving spouses find themselves overwhelmed by all the administrative and financial to-do items that have to be handled in the months after their spouse’s death. There’s a lot to do, and they’re supposed to get it all done while grieving. And in many cases, the situation is made more difficult by the fact that the surviving spouse is not the one who regularly handled the household finances.
I wrote this book to walk people through it, in plain language. It’s the book I want my spouse to have, in case something happens to me.
Fortunately, some of these to-do items for surviving spouses are important but not urgent. And in fact, for some of these items, it’s best to wait. Many people report experiencing “brain fog” in the weeks or months following their spouse’s death. They find that they have difficulty concentrating and difficulty performing tasks that would normally be easy. Major, irrevocable decisions are best put off until this period is over, in cases in which it’s practical to do so.
That’s why the book is broken down into two parts: immediate next steps and intermediate next steps.
The book’s table of contents is as follows:
Part One: Immediate Next Steps
1. Learn the Terms (The Estate Administration Process) 2. Getting Organized 3. Notifying Necessary Parties 4. Initial Responsibilities as Personal Representative 5. Updating Your Own Estate Plan
Part Two: Intermediate Next Steps
6. Social Security Planning 7. Further Responsibilities as Personal Representative 8. Handling Inherited Retirement Accounts 9. Additional Options as a Beneficiary and Surviving Spouse 10. Tax Returns 11. Reassessing Your Own Finances 12. Reassess Your Portfolio 13. Finding Professional Assistance
Conclusion: What’s Next?
Appendix A: Does an Inheritance Create Taxable Income?
Appendix B: Social Security Widow(er) Benefit Math Details
Appendix C: Dealing with Trusts
Database of State Incentives for Renewables & Efficiency®
Check out this website https://www.dsireusa.org/ for information on nation-wide, sate, or local energy efficiency incentives for personal and business uses.
Considering buying or leasing an EV or hybrid vehicle, adding insulation, upgrading HVAC, going solar, buying new appliances for home or business? Check out this website for links to a money saving tax credits.
"DSIRE is the most comprehensive source of information on incentives and policies that support renewables and energy efficiency in the United States. Established in 1995, DSIRE is operated by the N.C. Clean Energy Technology Center at N.C. State University and receives support from EnergySage."
Save on Printer Ink
Computer printers are cheap to buy but ink is expensive. Typically you will pay more for ink over the life of the printer than the initial cost. As Consumer Reports states, "Ounce for ounce, it (ink) routinely exceeds gasoline and even Dom Perignon Champagne in price."
To save ink, use the DRAFT mode when you just need a printout but don't need picture perfect quality. Also, Times New Roman font goes 27% further than using Arial font.
September 22, 2022
Comparing auto loans
The Consumer Financial Protection Bureau (CFPB Has a helpful worksheet for persons shopping for a vehicle loan. See: https://files.consumerfinance.gov/f/documents/201606_cfpb_auto-loan-worksheet.pdf
Learn what questions to ask about vehicle financing: https://www.consumerfinance.gov/consumer-tools/auto-loans/
If you are having trouble paying your bills during this period of high inflation, watch the video Prioritizing Bills: https://www.consumerfinance.gov/about-us/blog/tools-to-help-pay-bills/
The CFPB is a government agency with an abundance of practical financial information and advice. Check out: https://www.consumerfinance.gov/
SEQUENCE-OF-RETURN risk
"SEQUENCE-OF-RETURN risk has long been a major concern among retirees—and it’s a real danger right now for those who just quit the workforce or soon will. Also known simply as sequence risk, it refers to the chance that the market declines sharply, forcing retirees to sell investments at depressed prices to generate income."
Sound like today's situation with investment losses and high inflation? Keep reading...
"Wade Pfau, a leading retirement researcher, published a paper highlighting the danger involved. As he makes clear, a few years of market losses coupled with portfolio withdrawals can decimate savings, increasing the risk that a retiree will run out of money."
Richard Conner explains how to counteract sequence-of-return risk in his Humble Dollar https://humbledollar.com/ blog post "Beginning Badly." Learn five ways to structure retirement income to lessen sequence risk’s impact:
1. Annuitize. (Search for the links to annuities in this blog)
2. Cash bucket.
3. Reduce spending.
4. Work.
5. Social Security. (But I caution against taking SS before age 70 unless you expect to die young.)
Get the details at: https://humbledollar.com/2022/09/beginning-badly/?utm_source=mailpoet&utm_medium=email&utm_campaign=another-ses-test_7
Tiresome Debates about the 4% "rule", Claiming Social Security, and investing vs. paying down debt
Jonathan Clements, author of the Humble Dollar Blog https://humbledollar.com/ and former Wall Street Journal financial columnist, is one of the most sensible financial experts I've encountered in a 40+ year career of teaching personal finance. Check out his blog.
Rather than me summarizing his main points, read the financial journalists column "Tiresome Debates" about:
1. Should you use the 4% withdrawal rate?
2. Should you take Social Security early and invest the money?
3. Should you use your spare cash to invest or pay down debt?
Check it out: https://humbledollar.com/2022/09/tiresome-debates/?utm_source=mailpoet&utm_medium=email&utm_campaign=another-ses-test_7
Explore the Humble Dollar blog for a full financial education: https://humbledollar.com/
September 21, 2022
Parent Plus Loans for College Can Be Toxic
The Subprime Loans for College Hiding in Plain Sight
Writing for The New York Times, Ron Lieber explains how poor a choice Parent Plus loans can be for many families.
"If you want your kids to go to college but you can’t afford the bills, the federal government has a deal for you that will blow your mind."
"You can borrow the entire cost — minus any other aid your child receives — through something called a Parent PLUS loan. Moreover, your income — and thus your ability to repay the debt — doesn’t matter. As long as you don’t have one of a handful of black marks in your recent credit history, you can borrow six figures even if your take-home pay puts you below the federal poverty level."
"This is totally bananas. But don’t take my word for it."
Think tanks and policy institutes on all sides of the political spectrum agree that the loose lending policies letting just about anyone sign away their financial future are a terrible loan program.
These loans have been particularly toxic for low income families, many who are Black who are saddled with debt they can never replay.
You need a subscription to the NYT to be able to read the full article but if you are considering one of these loans, do your research and consult a financial advisor before signing up. There are other ways to afford higher education!
September 14, 2022
Popular Personal Financial Advice versus the Professors
"JAMES J. CHOI is a finance professor at Yale University. But in a recent paper titled “Popular Personal Financial Advice versus the Professors,” Choi played the role of (somewhat) neutral arbiter. The question he sought to answer: Do popular—that is, non-academic—personal finance books offer advice consistent with the academic literature? And if not, is that a problem?"
Adam M. Grossman
Gaming the College Ranking System. Who Can You Trust?
In Games Colleges Play Greg Spears reveals how some colleges and universities have manipulated the national college ratings systems to appear much better than they are in reality, providing doctored or fraudulent data to the raters. Michael Thaddeus, a Columbia University math professor "demolishes his employer’s U.S. News ranking as the second-best college in the nation. He also suggests there are better sites to use when evaluating colleges."
"In his paper, Thaddeus compared Columbia’s reported U.S. News numbers against publicly available information. He found Columbia stretched the truth quite often to raise its ranking."
"For example, Columbia told U.S. News that 100% of its faculty have PhDs or terminal degrees in their field, a higher percentage than Princeton, MIT, Harvard or Yale. Looking through faculty bios, Thaddeus found 66 cases where this was not the case—although these faculty may still be great teachers and one, in fact, has a Nobel Prize. Still, just 96% of the Columbia faculty have earned the highest degree in their field, according to Thaddeus."
"Columbia reported that more than 96% of its faculty are fulltime. Thaddeus’s research yielded a figure of 74%. Columbia claimed that 82% of its classes contain fewer than 20 students. From the data he found, Thaddeus concludes the true number is at most 67%. Columbia reported its student-faculty ratio is 6:1. Thaddeus comes up somewhere between 8:1 and 11:1 based on the information he could find."
Columbia charges $86,000 per year in tuition, fees, room and board.
Columbia is not the only institution to fudge its numbers to get a higher ranking. Spears offers numerous other examples in his article on the Humble Dollar website.
So who can you trust?
Thaddeus recommends three websites to evaluate colleges. “College applicants are much better advised to rely on government websites like College Navigator and College Scorecard, which compare specific aspects of specific schools. A broad categorization of institutions, like the Carnegie Classification, may also be helpful.”
"What you won’t find on these sites are any hierarchical rankings or bragging rights. You become the judge of the best schools, given the raw data and what you know about your child."
Thanks Greg for this valuable information!
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