Too Smart
.Too Smart
Jul 13, 2021 by Morgan Housel
“One of the most persistent fallacies is the reflexive association of wealth with wisdom,” Ed Borgato once wrote.
Wealth might be a sign of good decisions, but can those decisions be repeated? And do good decisions in one field translate to wisdom in other areas of life? Maybe, maybe not – that’s the best we can say. And there are times where exceptional wealth can prevent empathizing with ordinary people, making insight more precarious.
A similar mistake, a bit harder to grasp, is the assumption that smart people have the right answers.
They may. But does intelligence in one field convert to others? Does being good at taking tests translate to, say, leading groups of people?
Maybe. It’s never clear.
Too Smart
Jul 13, 2021 by Morgan Housel
“One of the most persistent fallacies is the reflexive association of wealth with wisdom,” Ed Borgato once wrote.
Wealth might be a sign of good decisions, but can those decisions be repeated? And do good decisions in one field translate to wisdom in other areas of life? Maybe, maybe not – that’s the best we can say. And there are times where exceptional wealth can prevent empathizing with ordinary people, making insight more precarious.
A similar mistake, a bit harder to grasp, is the assumption that smart people have the right answers.
They may. But does intelligence in one field convert to others? Does being good at taking tests translate to, say, leading groups of people?
Maybe. It’s never clear.
And like wealth, there are situations where people become too smart for their own good, where intelligence is a liability and blocks good decisions.
A few causes:
The ability to create complex stories makes it easy to fool people, including yourself.
I know people I would not want to debate with on the question, “What is 2 + 2?” because they could go down a rabbit hole that’s over my head and leave me either exhausted or convinced the answer may not be four.
The dangerous thing is that those people can do the same things to themselves.
Richard Feynman said, “The first principle is that you must not fool yourself — and you are the easiest person to fool.” The smarter you are I think the truer that becomes.
When you’re blessed with intelligence you’re cursed with the ability to use it to concoct intricate stories about why things happened – especially stories justifying why you made a mistake or why you’ll eventually be right in an area you’re wrong.
To continue reading, please go to the original article here:
20 Home Renovations That Will Hurt Your Home’s Value
.20 Home Renovations That Will Hurt Your Home’s Value
You might love these renovations, but they'll cost you.
By Autumn Rose July 21, 2021
Your home isn't just a source of pride or a place where you can relax after a long day -- it's also an investment in your family's future.
And while it's natural to want to make improvements to increase your home's resale value, some renovations will actually cost you money in the long run. Just because you see something as an improvement doesn't mean a potential buyer will feel the same way. Find out which renovations are ones to avoid.
Lavish Lighting Fixtures
One common home improvement mistake is falling in love with unique or lavish light fixtures, said Alon Barzilay, founder of real estate development company Urban Conversions.
20 Home Renovations That Will Hurt Your Home’s Value
You might love these renovations, but they'll cost you.
By Autumn Rose July 21, 2021
Your home isn't just a source of pride or a place where you can relax after a long day -- it's also an investment in your family's future.
And while it's natural to want to make improvements to increase your home's resale value, some renovations will actually cost you money in the long run. Just because you see something as an improvement doesn't mean a potential buyer will feel the same way. Find out which renovations are ones to avoid.
Lavish Lighting Fixtures
One common home improvement mistake is falling in love with unique or lavish light fixtures, said Alon Barzilay, founder of real estate development company Urban Conversions.
"Whether it be ceiling-mounted lights in a dining room or a hanging pendant, there is a psychological phenomenon that happens when you go to a lighting store … you're going to pick something exciting and new instead of picking a new addition that suddenly matches the big picture," Barzilay said.
Further, the passage of trends works against homeowners. "Whatever is in vogue today will look dated 10 years down the road when you are ready to sell," he said. "Simple is best. Fortunately, lighting can easily be switched out at a low cost."
Too Much Wallpaper
With its patterns and texture, wallpaper can be an overwhelming design choice for your home. Plus, it's notoriously difficult to remove. Homebuyers might view wallpaper removal as a potential headache, and it could be the tipping point for someone who wants a more move-in ready home.
Fresh paint and neutral colors are always a good idea to help stage your home when it's on the market. If you do have wallpaper, think about whether it's beneficial to remove it and repaint the walls before any showings or open houses, so your potential buyers never have to think about your wallpaper mistakes.
Texture on the Walls and Ceilings
Just like wallpaper, texture on walls and ceilings is difficult to remove. Simply knowing that a time-consuming project lies ahead might cause homebuyers to decrease their offer. Think twice before deciding on a fancy textured painting technique, and play around with textured wall décor instead.
Quirky Tiling
Any over-personalized renovation can hurt the value of a home, especially something like tiling, which requires more effort and money to replace, said Bob Gordon, realtor and blogger at Boulder Real Estate News.
"Many buyers like to upgrade the floors in their homes," he said. "Adding tile or wood can make an improvement in value -- unless you get that person who wants the 1950s diner look and installs black-and-white tile. For their vision, this is the pinnacle of cool. But for a resale value, most homebuyers will see it as a distraction and something they will need to rip out."
To continue reading, please go to the original article here:
https://www.gobankingrates.com/investing/real-estate/home-renovations-hurt-homes-value/
17 Dumb Home-Buying Mistakes That Hurt Your Wallet
.17 Dumb Home-Buying Mistakes That Hurt Your Wallet
Take your time making the biggest purchase of your life.
By Daria Uhlig June 29, 2021 Real Estate Investing 101
Of all the investment decisions you're likely to make in your lifetime, a home purchase is by far the most personal. It's no wonder that buyers are eager to rush right into the real estate market the moment they realize they're in a position to buy. But because the purchase will likely be the most expensive one you ever will make, it's important to organize your priorities and your finances before you jump in.
Keep reading to learn about home-buying mistakes that can hurt your wallet — and steps you can take to avoid them.
Ignoring Your Credit
Strong credit can save you thousands of dollars in interest over the life of your mortgage loan. Credit problems can take time to resolve, so the earlier you start reviewing your credit, the better. The first step is to order a credit report.
17 Dumb Home-Buying Mistakes That Hurt Your Wallet
Take your time making the biggest purchase of your life.
By Daria Uhlig June 29, 2021 Real Estate Investing 101
Of all the investment decisions you're likely to make in your lifetime, a home purchase is by far the most personal. It's no wonder that buyers are eager to rush right into the real estate market the moment they realize they're in a position to buy. But because the purchase will likely be the most expensive one you ever will make, it's important to organize your priorities and your finances before you jump in.
Keep reading to learn about home-buying mistakes that can hurt your wallet — and steps you can take to avoid them.
Ignoring Your Credit
Strong credit can save you thousands of dollars in interest over the life of your mortgage loan. Credit problems can take time to resolve, so the earlier you start reviewing your credit, the better. The first step is to order a credit report.
You're entitled to one free report per year from each credit bureau, which you can order from AnnualCreditReport.com. However, through April 2021, all three credit bureaus — TransUnion, Equifax and Experian — are offering a free weekly online report to help you stay on top of your credit during the COVID-19 pandemic.
If you spot signs of trouble or inaccuracies, contact the appropriate credit bureau as soon as possible. Things to look for include:
Outdated information, such as a closed account that's being reported as open
Incorrect contact information
Accounts you didn't open
Accounts listed multiple times
Also, be on the lookout for old collection accounts you need to pay off. If you moved, for example, your final utility bills might not have reached you and a balance could remain, even though the account is closed.
House Hunting Without a Buyer's Agent
It might be tempting to go at it alone, armed with information available on the real estate portal sites. That could be a big mistake. Online sites let buyers view the inventory of properties on the market, but they aren't a substitute for a professional's knowledge.
A buyer's agent who knows your local market can prepare a comparative market analysis to determine an appropriate offer price for the home you're most interested in. They'll also negotiate on your behalf to make sure your best interests are protected.
In many cases, your buyer's agent is your only fiduciary in the real estate transaction, meaning the agent is the only professional you'll work with who has a legal obligation to put your interests above their own. What's more, the seller typically pays the buyer's agent, so you've got nothing to lose by arming yourself with professional representation.
Shopping With Your Heart vs. Your Head
To continue reading, please go to the original article here:
https://www.gobankingrates.com/investing/real-estate/mistakes-avoid-shopping-new-home/
20 Home Renovations That Will Hurt Your Home’s Value
.20 Home Renovations That Will Hurt Your Home’s Value
You might love these renovations, but they'll cost you.
By Autumn Rose July 21, 2021
Your home isn't just a source of pride or a place where you can relax after a long day -- it's also an investment in your family's future.
And while it's natural to want to make improvements to increase your home's resale value, some renovations will actually cost you money in the long run. Just because you see something as an improvement doesn't mean a potential buyer will feel the same way. Find out which renovations are ones to avoid.
Lavish Lighting Fixtures
One common home improvement mistake is falling in love with unique or lavish light fixtures, said Alon Barzilay, founder of real estate development company Urban Conversions.
20 Home Renovations That Will Hurt Your Home’s Value
You might love these renovations, but they'll cost you.
By Autumn Rose July 21, 2021
Your home isn't just a source of pride or a place where you can relax after a long day -- it's also an investment in your family's future.
And while it's natural to want to make improvements to increase your home's resale value, some renovations will actually cost you money in the long run. Just because you see something as an improvement doesn't mean a potential buyer will feel the same way. Find out which renovations are ones to avoid.
Lavish Lighting Fixtures
One common home improvement mistake is falling in love with unique or lavish light fixtures, said Alon Barzilay, founder of real estate development company Urban Conversions.
"Whether it be ceiling-mounted lights in a dining room or a hanging pendant, there is a psychological phenomenon that happens when you go to a lighting store … you're going to pick something exciting and new instead of picking a new addition that suddenly matches the big picture," Barzilay said.
Further, the passage of trends works against homeowners. "Whatever is in vogue today will look dated 10 years down the road when you are ready to sell," he said. "Simple is best. Fortunately, lighting can easily be switched out at a low cost."
Too Much Wallpaper
With its patterns and texture, wallpaper can be an overwhelming design choice for your home. Plus, it's notoriously difficult to remove. Homebuyers might view wallpaper removal as a potential headache, and it could be the tipping point for someone who wants a more move-in ready home.
Fresh paint and neutral colors are always a good idea to help stage your home when it's on the market. If you do have wallpaper, think about whether it's beneficial to remove it and repaint the walls before any showings or open houses, so your potential buyers never have to think about your wallpaper mistakes.
Texture on the Walls and Ceilings
Just like wallpaper, texture on walls and ceilings is difficult to remove. Simply knowing that a time-consuming project lies ahead might cause homebuyers to decrease their offer. Think twice before deciding on a fancy textured painting technique, and play around with textured wall décor instead.
Quirky Tiling
Any over-personalized renovation can hurt the value of a home, especially something like tiling, which requires more effort and money to replace, said Bob Gordon, realtor and blogger at Boulder Real Estate News. "Many buyers like to upgrade the floors in their homes," he said. "Adding tile or wood can make an improvement in value -- unless you get that person who wants the 1950s diner look and installs black-and-white tile. For their vision, this is the pinnacle of cool. But for a resale value, most homebuyers will see it as a distraction and something they will need to rip out."
To continue reading, please go to the original article here:
https://www.gobankingrates.com/investing/real-estate/home-renovations-hurt-homes-value/
Top 10 Rules for Money
.Top 10 Rules for Money
July 7, 2021 8:30am by Barry Ritholtz
Ten Simple Money Rules for Investing Success
Bad decisions and poor behavior are the primary reasons why many fail to meet their financial goals.
Creating lists1 is a useful way to organize your thoughts: I have created lists of rules for Investing, Valuation, Stock tips, Goldbuggery, even useless financial phrases to avoid. I find these exercises to be valuable ways to figure out what I think. Thinking about money – saving it, spending it, and most of all, how to invest it – is something I have spent decades doing. This has led to recognizing several fundamental truths about capital.
Naturally, I have organized these rules into a list:
Top 10 Rules for Money
July 7, 2021 8:30am by Barry Ritholtz
Ten Simple Money Rules for Investing Success
Bad decisions and poor behavior are the primary reasons why many fail to meet their financial goals.
Creating lists1 is a useful way to organize your thoughts: I have created lists of rules for Investing, Valuation, Stock tips, Goldbuggery, even useless financial phrases to avoid. I find these exercises to be valuable ways to figure out what I think. Thinking about money – saving it, spending it, and most of all, how to invest it – is something I have spent decades doing. This has led to recognizing several fundamental truths about capital.
Naturally, I have organized these rules into a list:
My Top 10 Rules for Money
1. Investing Is Both Simple and Hard: The basic premise behind successful investing is easily understood: “Invest for the long term, be diversified, watch your costs, and let compounding work its magic.”
But following through can be challenging. Humans are plagued by an inability to just “sit there and do nothing.” Failing to do nothing leads to costly errors and loss of capital that erode returns. Understanding what is required is very different than being able to perform, regardless of circumstances, for decades on end.
This leads us to:
2. Behavior Is Everything: The inability to manage emotions and behavior is the financial undoing of many. To paraphrase William Bernstein, “the extent you succeed in finance is based on your ability to suppress your limbic system. If you can’t do that, you’re going to die poor.”
Even the greatest stock pickers will underperform if unable to control their emotional impulses. Allowing those emotional hot buttons to get pressed is how people go wrong in investing. There are no shortcuts, secrets or get rich quick schemes that work, except for my 3-day workshop where I reveal the secrets of the ultra-rich for the low, low price of $4,995. Sign up here.
3. Moderation In All Things: Think of the majority of the assets in your portfolio -– hopefully a diversified, global mix of passive index funds — as the basic meat and potatoes of investing. You can add seasonings, herbs, and vegetables to spice it up and add some flavor.
To continue reading, please go to the original article here:
To hear an audio spoken word version of this post, click here.
20 Insider Tips To Save Money on Every Part of Your Home
.20 Insider Tips To Save Money on Every Part of Your Home
Cut costs on your mortgage, renovations and decorating.
By Gabrielle Olya July 12, 2021 Save Money at Home
The expenses that come with buying, renovating and decorating a home can add up, but fortunately, there are ways to save money every step of the way.
GOBankingRates asked real estate insiders for their best tips on how to save money on every part of your home, and their advice can help cut costs for anyone looking to buy a new home or renovate the one they currently have.
Here's how to save money in every nook and cranny of your house.
20 Insider Tips To Save Money on Every Part of Your Home
Cut costs on your mortgage, renovations and decorating.
By Gabrielle Olya July 12, 2021 Save Money at Home
The expenses that come with buying, renovating and decorating a home can add up, but fortunately, there are ways to save money every step of the way.
GOBankingRates asked real estate insiders for their best tips on how to save money on every part of your home, and their advice can help cut costs for anyone looking to buy a new home or renovate the one they currently have.
Here's how to save money in every nook and cranny of your house.
1. Get a Mortgage With No Down Payment
Find out if you qualify for a government home loan, as there are options that require no down payment at all. U.S. Department of Agriculture loans are available for borrowers in need who want to purchase a home in rural or suburban areas. Veteran’s Administration loans are available to active-duty or prior-duty service members and, in certain cases, their spouses and widows or widowers. VA loans are available through private lenders, such as NBKC Bank. VA home loans and USDA loans do not require a down payment.
“The greatest features of a VA home loan are that there is no down payment required if you stay within the county loan limits, and there is no PMI insurance ever,” said Jim Schneider, former army officer and a loan specialist at NBKC Bank. “On any other type of loan, if you put down less than 20% of the purchase price you are required to pay PMI insurance on the loan. This can be hundreds of dollars per month, which can be totally avoided by doing a VA loan. On top of those benefits, the VA loan will also have the lowest rate available among all loan types because it is the least risky loan a bank can do.”
2. Take Advantage of Down Payment Assistance Programs
If you can’t afford a down payment and don’t qualify for a mortgage with no down payment, that doesn’t mean you can’t buy a home.
“There are so many down payment assistance programs out there for buyers, so educate yourself,” said Dawn Houlf, realtor and owner of EXIT Realty Number One.
One option is a 203k loan, which can also help cover renovation costs.
“First-time homeowners who want to renovate their homes on a budget, or homeowners who opted to buy a distressed property for a good deal, should strongly consider the 203k loan,” said Than Merrill, founder of real estate investment company CT Homes. “A 203k loan is a type of home renovation loan that is backed by the Federal Housing Administration.
The loan includes both the cost of purchasing a property, plus the estimated costs for renovating it. Homebuyers that wish to rehabilitate an older or damaged home can get approved. Not only will this loan cover home upgrades, it also allows borrowers to put down 3.5% on their homes as opposed to the standard 20%.”
To continue reading, please go to the original article here:
https://www.gobankingrates.com/saving-money/home/tips-to-save-money-on-home/
Buying a House in 2021
.Buying a House in 2021
Published June 30, 2021 by J.D. Roth
I feel as if, right now in 2021, I am swinging along on a comfortable trapeze bar and that I need to swing to the next one. And…I’m a little scared. One source of this trepidation is my current housing situation. Kim and I sold our home last month and are looking for another. As you might have heard, it’s a crazy time to buy. Our stories today reflect that. It’s the parable of the trapeze by Danaan Parry.
Buying a House in 2021 June 23, 2021 by One Frugal Girl
Last June we had a wild idea. After nearly twenty years of living in the same house, we decided it was time to move. Despite limited inventory and wildly escalating prices, we vowed to find a new place. With flexible work options, we can finally move out to the countryside. How hard could it be to find a new place to live? It didn’t seem that difficult at first. We planned to drive through a few neighborhoods, make an offer, and move in.
Buying a House in 2021
Published June 30, 2021 by J.D. Roth
I feel as if, right now in 2021, I am swinging along on a comfortable trapeze bar and that I need to swing to the next one. And…I’m a little scared. One source of this trepidation is my current housing situation. Kim and I sold our home last month and are looking for another. As you might have heard, it’s a crazy time to buy. Our stories today reflect that. It’s the parable of the trapeze by Danaan Parry.
Buying a House in 2021 June 23, 2021 by One Frugal Girl
Last June we had a wild idea. After nearly twenty years of living in the same house, we decided it was time to move. Despite limited inventory and wildly escalating prices, we vowed to find a new place. With flexible work options, we can finally move out to the countryside. How hard could it be to find a new place to live? It didn’t seem that difficult at first. We planned to drive through a few neighborhoods, make an offer, and move in.
If only it were that easy! Instead of finding a new house, we spent countless hours stalking new home listings and setting alerts for neighborhoods in our desired price range. Once a week, we drove north and west in search of the perfect spot, only to come home tired and disappointed.
After nine months, we grew restless and eventually settled on a house we didn’t love. Thankfully, an undisclosed conservation easement allowed us to back out of the deal. If it hadn’t been for that glitch, we would’ve bought the wrong house and been miserable.
Must-Haves When Searching for a Home
To further complicate matters, our list of must-haves grew and shrank throughout our home buying journey. What seemed important one day didn’t seem significant the next. Each time we stepped into a house, we changed our minds.
But nearly buying the wrong house changed everything for me. The house we almost bought was dark and dismal, with small windows and a shady backyard. After recognizing our error, we only considered houses with large windows and lots of natural sunlight.
To continue reading, please go to the original article here:
https://www.onefrugalgirl.com/buying-a-house-in-2021/
15 Things to do if you Get Rich All of a Sudden
.From Recaps Archives
15 Things To Do If You Get Rich All of a Sudden
In this Alux.com video we'll try to answer the following questions:
What should you do if you get rich all of a sudden?
What do to if you inherit money?
How to manage a large sum of money?
What should you do if you get rich?
What do to if you win the lotto?
From Recaps Archives
15 Things To Do If You Get Rich All of a Sudden
In this Alux.com video we'll try to answer the following questions:
What should you do if you get rich all of a sudden?
What do to if you inherit money?
How to manage a large sum of money?
What should you do if you get rich?
What do to if you win the lotto?
How to manage wealth? How to get wealthy?
How to maintain being rich?
How to keep your wealth?
How not to lose money?
Why do people go broke after they went rich?
How do people lose money?
What if you inherit a fortune?
I just inherited a million dollars, what do I do? How to you being investing money?
What you should know about money?
If You’re Still Worried, You Aren’t Wealthy
.If You’re Still Worried, You Aren’t Wealthy
Posted June 1, 2021 by Ben Carlson
Wealth means different things to different people.
Some people assume wealth is the amount of money you have in the bank or your investment portfolio. Others judge wealth based on the number of material possessions you’re able to buy. Then there are those people who figure only those with a high enough income can be considered rich.
What constitutes a rich life really depends on your relationship with money and what matters most to you in life. There are many ways to become wealthy that don’t involve money. Being content with what you have is a sure sign you’re living a rich life.
If You’re Still Worried, You Aren’t Wealthy
Posted June 1, 2021 by Ben Carlson
Wealth means different things to different people.
Some people assume wealth is the amount of money you have in the bank or your investment portfolio. Others judge wealth based on the number of material possessions you’re able to buy. Then there are those people who figure only those with a high enough income can be considered rich.
What constitutes a rich life really depends on your relationship with money and what matters most to you in life. There are many ways to become wealthy that don’t involve money. Being content with what you have is a sure sign you’re living a rich life.
When you’re content, a number doesn’t matter as much as your mindset.
Take this headline from this weekend’s Wall Street Journal:
Millennials haven’t always had it easy. Many had student loans, stagnating wages and a difficult job market to deal with following the 2008 financial crisis. So I get why some people are gunshy:
Many of these workers may have struggled with stagnating wages and huge student loan debts earlier in their careers. Some worry they’ll mismanage this boon and forever ruin their chance at financial stability.
“These individuals completely feel and understand and recognize the pain of the last year, but now they’re being given an opportunity to come out of that,” Mr. Vakil said. “They’re saying, ‘This is my one chance.’ They’re taking it with both hands. They don’t want to mess it up.”
Sure, you don’t want to make unnecessary mistakes but the whole point of wealth is that it’s supposed to make your life less stressful. For many it seems building wealth only intensifies their worries.
Look at this headline from MarketWatch:
This person has a net worth that puts them in the top 5% of all Americans and yet they still have trouble sleeping at night because of financial worries. Here’s the kicker:
To continue reading, please go to the original article here:
https://awealthofcommonsense.com/2021/06/if-youre-still-worried-you-arent-wealthy/
13 Financial Moves to Make After Losing a Spouse
.13 Financial Moves to Make After Losing a Spouse
Nothing upends your world like the death of a spouse, leaving you at a loss for what to do next.
by: Janet Kidd Stewart April 29, 2020
Nothing upends your world like the death of a spouse, leaving you at a loss for what to do next. When death comes before you realize your retirement plans, it can be particularly devastating.
Triage Your Tasks
Of the roughly 15 million widows and widowers in the United States, about 2.8 million women and 800,000 men are younger than age 65, according to Census Bureau data. But whether you are of retirement age or not, making the right financial moves early can set you up for greater financial stability later on.
The oft-quoted mantra of telling grieving spouses not to make any financial decisions for a year is misguided at best and disastrous at worst. Many decisions simply can’t be postponed for a year, and others shouldn’t be rushed into. “We advocate a much more nuanced timeline,” says Susan Bradley, founder of the Sudden Money Institute, which trains financial advisers to work with clients in transition.
13 Financial Moves to Make After Losing a Spouse
Nothing upends your world like the death of a spouse, leaving you at a loss for what to do next.
by: Janet Kidd Stewart April 29, 2020
Nothing upends your world like the death of a spouse, leaving you at a loss for what to do next. When death comes before you realize your retirement plans, it can be particularly devastating.
Triage Your Tasks
Of the roughly 15 million widows and widowers in the United States, about 2.8 million women and 800,000 men are younger than age 65, according to Census Bureau data. But whether you are of retirement age or not, making the right financial moves early can set you up for greater financial stability later on.
The oft-quoted mantra of telling grieving spouses not to make any financial decisions for a year is misguided at best and disastrous at worst. Many decisions simply can’t be postponed for a year, and others shouldn’t be rushed into. “We advocate a much more nuanced timeline,” says Susan Bradley, founder of the Sudden Money Institute, which trains financial advisers to work with clients in transition.
She recommends breaking tasks down into three piles — urgent, soon and later — with those in the last pile being perhaps two years or more down the road, depending on individual circumstances.
A surviving stay-at-home spouse with school-age kids may have the resources to keep the family home until the youngest graduates, for example, but then may need (or want) to downsize and head back to work. An empty nester who had been counting on a few more years of a spouse’s income before retirement — and at least a few years of dual Social Security checks — may need to adjust more quickly.
Gather Documents
Now, for the practical matters. If it’s still early days, begin by making sure the funeral director you’re working with has notified the Social Security Administration of the death and ordered 15 to 20 certified copies of the death certificate for tasks such as retitling the mortgage and changing owner names on financial accounts.
You’ll need one or more of these documents to apply for Social Security benefits, work with your spouse’s employer to distribute life insurance and other benefits such as final pay and retirement plan savings, collect private life insurance proceeds and create a cash flow statement and household budget.
Keep Good Records
Get a notebook for logging conversations with your spouse’s employer, Social Security clerks and others. Advisers and survivors say this is essential in the foggy, early days of grief.
“I kept notes on everything,” says Sue Knight Deutsch, who lost her husband Michael to colon cancer in 2009. He was 55; she was 53. “I had a notebook and every time I made a call I wrote down a date and case number for the call so when I would call again and get a new person I could tell them the number.”
Also, keep an expandable file near the notebook. The file should hold the death certificates and other important papers, correspondence related to the spouse’s death and current bills due and paid.
Organize the Bills
If your spouse handled the bills and you need a new system, create one box or tray for unopened mail and make sure every piece goes into that box. Look through the checkbook or online banking account for past or recurring payments. If you have access to your spouse’s email account, look for electronic notifications of bills due.
To continue reading, please go to the original article here:
The Financial Effects of Losing a Spouse
.The Financial Effects of Losing a Spouse
Rocky Mengle, Tax Editor Fri, July 16, 2021
The death of a spouse is one of the most difficult things imaginable. Besides the emotional toll, surviving spouses typically confront financial issues, which often trigger tax-related questions and consequences. Some of them are fairly straightforward, while others can be tricky. That's why Letha McDowell, president of the National Academy of Elder Law Attorneys, advises surviving spouses not to make major financial changes immediately. Instead, she tells them to reassess their finances from a tax perspective.
The loss of income after a spouse dies certainly has tax implications. For instance, if a drop in income means the surviving spouse needs to tap into a retirement account, McDowell points out that "the taxes may be less than initially anticipated because, if you have lower income, you may be in a lower bracket."
The Financial Effects of Losing a Spouse
Rocky Mengle, Tax Editor Fri, July 16, 2021
The death of a spouse is one of the most difficult things imaginable. Besides the emotional toll, surviving spouses typically confront financial issues, which often trigger tax-related questions and consequences. Some of them are fairly straightforward, while others can be tricky. That's why Letha McDowell, president of the National Academy of Elder Law Attorneys, advises surviving spouses not to make major financial changes immediately. Instead, she tells them to reassess their finances from a tax perspective.
The loss of income after a spouse dies certainly has tax implications. For instance, if a drop in income means the surviving spouse needs to tap into a retirement account, McDowell points out that "the taxes may be less than initially anticipated because, if you have lower income, you may be in a lower bracket."
Less income could also mean that the surviving spouse now qualifies for certain tax deductions or credits that have income caps or phase-out rules. Local jurisdictions often have income-based property tax breaks that may suddenly become available, too.
Eventually, every surviving spouse has a new filing status. A joint federal tax return is allowed for the year the deceased spouse dies if the surviving spouse didn't remarry. The qualifying widow(er) status may be an option for two more years if there's a dependent child. After that, a surviving spouse who doesn't remarry must file as a single taxpayer, which usually means less favorable tax rates and a lower standard deduction.
Inheriting a traditional IRA can also affect the surviving spouse's taxes, but first, there's a decision to make. An inheriting spouse can be designated as the account owner, roll the funds into their own retirement account, or be treated as a beneficiary. That decision will affect required minimum distributions and ultimately the surviving spouse's taxable income.
As either the designated owner of the original account or the owner of the account with rolled-over funds, the surviving spouse can take RMDs based on their own life expectancy. If the third option -- staying as the IRA's beneficiary -- is chosen, RMDs are based on the life expectancy of the deceased spouse. "Almost everyone either rolls [an inherited IRA] into their own IRA or at least they transfer it into an account in their name," McDowell notes.
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