When Is It Time To Get Rid Of Your Financial Records?

Now that we’re in the second half of the year, it’s time to think about how long you have to – or want to – keep all of the financial documents and bills and tax returns and other information you have. And – while you’re at it – setting up a better filing system for your retained financial info (other than a shoe box or throwing it into a drawer) is a good idea as well.

Let’s start with the simplest things to dispose of. Any type of ATM receipt or deposit slip or cancelled check can be shredded once you reconcile the withdrawal or deposit with your account either online or via your monthly statement. (And if you don’t have a shredder, get yourself to a Staples or Target today and buy one, please). More often than not these days, a bank will not return a physical copy of your cancelled check to you but you should always be able to get a copy of it from them if you need it. If you get a bank statement via paper, keep each month’s statement until you get or can print out an end-of-the-year summary.

If you still get a paper paycheck stub from your employer, keep them until you get your W-2 in the beginning of the following calendar year and can make sure all of your weekly pay has been properly accounted for in the W-2. And it’s always a good idea to keep your W-2 until you get your annual Social Security statement to make sure that what you were paid in a given year was reported to and recorded properly by the Social Security Administration.

For anything you charge or use your debit card to buy, you can usually get rid of the receipt as soon as you match it up with your monthly credit card bill or bank statement. The exception is that you might want to think about keeping receipts for big-ticket items like appliances and furniture and the like because sometimes you need to provide proof of purchase for warranties and extended insurance plans. If you own a small business, you should hang on to these types of receipts for 3 years to support any type of deductions you may have claimed or expenses you’ve shown on your federal and state income tax returns.

Any of your monthly or quarterly bills – think your electric or gas bill, cable, telephone, car insurance or trash removal – can be shredded after a year (unless the bill relates to your home business and you’ll need them for your tax returns).

And now that we’re talking about bills and bank statements, if you’re still getting paper copies, think about switching to online bank statements or monthly bills that are e-mailed to you instead of physically mailed to you. (If you work for the United States Post Office, I know you won’t appreciate me recommending this so I apologize in advance.)

If you sign-up for online bank statements, for example, you can avoid what is becoming a more popular trend by banks, which is to charge you a monthly fee for mailing you a paper copy of your bill. If you get your monthly bills e-mailed to you, you’ll always be able to access them (and save filing space) by keeping them digitally through saving them as a PDF file on your computer (which you can always print if you need to for some reason).

Let’s work backwards in terms of what you need to keep forever. Some of these are financial records, some are just personal records but – either way – they’re important to always have. First are the birth certificates for you and your family. As your children grow up, they’ll need their birth certificate to get a driver’s license or to submit a college application. All of you will need a birth certificate to get a passport. If you’ve misplaced it, you can order another copy either directly from the municipality in which you were born or through a company known as VitalChek.

If you’ve adopted children, keep the adoption papers forever. Once you’re married, your civil marriage license is important to keep always as it may be needed for insurance purposes. If you divorce one day, your divorce decree and support/custody agreements are important documents to always keep as they’ll be needed for selling a home, or taking your former spouse off your health insurance or removing your former spouse from your life insurance policy or bank account.

Anything relating to someone’s estate – a will, a power of attorney, a living will, a guardianship – should be kept forever.

The deed to your home and your mortgage note, as well as the mortgage satisfaction (once your mortgage is paid off) should also be kept with all of your other financial records forever.

Here’s what you need to keep for at least 3 years. Since your income tax returns can be audited for any reason up to 3 years after you file, that’s the minimum amount of time you should keep them.

Personally, I’ve kept my income tax returns since I divorced many years ago, scanned and saved digitally on my computer. Some people feel more comfortable holding on to income tax returns indefinitely. Whatever your comfort level is – as long as it’s at least 3 years – is what you should do.

Keeping a copy of your medical records, tests and insurance Explanations of Benefits for at least 3 years is also important. It lets you keep information readily available that you might need to share with new physicians or facilities which might not have easy access to your prior medical history.

It’s also a good idea to keep your insurance policies – auto, homeowners, umbrella and life – for at least 3 years. If you’ve made a claim or need to check what type of coverage was in effect at a certain point – or just want to keep track of your history of payments for a specific type of insurance – having these documents on hand is invaluable.

And – last but not least – spend a few hours and set up a filing system that works for your life and your habits. If you’re not a super-organized person, then don’t set up something you’ll only abandon because it’s too difficult and time-consuming. There are all kinds of organization systems that you can find at all sorts of stores like The Container Store or Staples. Here’s what I do (for what it’s worth).

I have an accordion file divided by month where I keep a copy of each month’s bills. I have another file by year where I keep a copy of each year’s tax returns and supporting documentation. And I have a third file that is set up alphabetically to file insurance policies, appliance warranties, medical records – you get the idea. I also try to scan everything on to my computer so – just in case something ever happened to my paper copies of documents – I’d still have a way to access my records.

Some people store important papers in their safe deposit boxes. Others use a version of what I do. What ultimately matters is that you keep your things organized in a way that works for you and that will enable you to find what you need when you need it without rifling through boxes of receipts, or pulling papers out of a file cabinet stuffed with them. A little bit of time spent now to organize will pay off when you need to look at your paperwork again. Trust me on this.

Start Your Engines. Now Is the Time To Buy a New Car.

Now that summer is officially here, it’s an excellent time to visit your local car dealer or look online if you’re in the market for a new car.

Typically,most new model year cars get released during the summer. Since car dealers have only so much space on their lots for inventory, that means that – as new models come in – they need to clear out current year models to make room for 2016 cars. Which means that now is a very good time to buy a 2015 model year car.

And so that you don’t think that you’ll be missing something by buying a 2015 model instead of a 2016 model, more often than not, car manufacturers only make minor design changes to cars from one year to the next. Sometimes it’s as simple as a new trim style that’s being offered. If a car manufacturer is making a major change, you can be sure they’ll be advertising it but it tends to be a few years between big changes in car models.

There are also some basic tips that can help you get a good price on a new car. Besides picking the optimum time of year to buy, there are better days or better weeks to buy cars. For example, since car dealers typically aren’t open on Sunday, they close out their sales week on Saturday evening. If you head to a dealer (armed with research, information, patience and a healthy dose of skepticism) late on a Saturday afternoon, you have a good chance of getting an even better deal as they need to up their sales figures for the week and getting you to sign on the dotted line before 9:00 on a Saturday night will help them achieve that.

Anyone who works on commission also has a monthly quota so the later in the month you head in, the better chance you have of getting a better deal on a new car. A motivated car sales person will likely be willing to cut their commission if it means the difference between making a sale or watching you walk out the door. And don’t let rain or snow prevent you from going to a dealer and looking at cars on the lot. Most people won’t want to go out in bad weather to shop for cars. You can leverage that to your advantage as that will make you an interested buyer to a motivated car sales person. A slow day at a dealership is always good for the consumer.

One of the things you do need to keep in mind, though, is that even if you follow all of these suggestions, sometimes you won’t be able to do much better on a prior year model particularly if it’s a high-demand car (think Prius) or relatively new styles (like small crossover SUVs). Do your research, pack your patience, don’t be talked into bells and whistles on cars you don’t need and be prepared to walk out the door if you can’t negotiate a deal that works for you.

If you do all of this, you just might be able to celebrate the long days of summer by driving off the lot in your new 2015 car, having saved yourself a considerable amount of money.

Women and Divorce – What You Need To Know – Part 3

A very complicated piece – and possibly a very contentious one as well – of a divorce is your and your spouse’s pensions and retirement benefits.

A pension and a 401k earned during your marriage are generally considered the same as any other type of marital property – that is, they’re treated the same way as your house or your bank accounts. According to very good information at the Pension Rights Center, typically a divorce court will decide how the pension assets are divided and whether a former spouse is permitted to receive your pension benefits (or for you to receive benefits under his or her pension).

Because this is an area where laws differ on a state-by-state basis, it is very important for your legal representation to research this so that your pension is handled properly. You will likely have to get your spouse to agree in writing that they are waiving their rights to your pension so please don’t ignore this important piece of financial housekeeping when you are divorcing. It’s not something you’d want to be facing years later when you are ready to collect your pension.

And since people can and do take withdrawals from 401k plans, you and your lawyer should make sure that what can be a sizeable asset is protected. As with pensions, any funds and interest earned in a 401k during a marriage is considered marital property so you need to use due diligence in making sure this is handled properly, both from a legal and a financial prospective.

Finally, at some point you’ll reach the age where you are able to collect Social Security retirement benefits. Not everyone realizes that – if you are divorced and your marriage had lasted more than 10 years – you can receive Social Security retirement benefits based on your ex-spouse’s earnings. That holds true even if your former spouse has remarried.

There are, of course, provisos to this, most notably that you must be unmarried and be over the age of 62. You also need to prove that the benefit you’d get based on your own work history would be less than the benefit you would be entitled to based on your former spouse’s work history. If you meet these requirements, you will be entitled to a Social Security payment that is 50% of the amount of the Social Security benefit your former spouse receives.

This can be beneficial to people who either have worked in lower-paying jobs than their former spouses or were stay-at-home parents with fewer working years. And it’s important to note that if you choose to collect benefits under your former spouse’s work history, it will not affect in any way the amount of Social Security benefits your former spouse (and his or her new partner, if they’ve remarried) is entitled to collect. A good analysis of this can be found on the Social Security Administration’s website.

While many things we’ve discussed in these articles can be managed through discussions with your spouse, it’s ultimately going to be to everyone’s benefit to have both legal and financial professionals work with you to ensure that your interests and your children’s interests are completely protected.

Women and Divorce – What You Need to Know – Part 2

One of the things we learn at an early age is that we need to protect our families. And for most of us that means taking out a life insurance policy. You may have purchased a life insurance policy on your own or you may have one through your company and the odds are that your spouse is the primary beneficiary of it. Once you’re divorced, you need to work with the life insurance company to change that so that you can designate who you want to be your primary beneficiary, whether that be your children or your siblings or your parents.

Another thing that is optional but if you have children something you may want to consider is taking a life insurance policy out on your spouse. If you will be getting alimony and/or child support and that will be an important component in supporting yourself and your family after the divorce, consider what would happen if your former spouse died suddenly and you were left without that income. Taking out a life insurance policy on your spouse can provide you with some financial peace of mind in that respect.

Whether or not you decide you need alimony is one thing but, if you have minor children, you must advocate for them by getting sufficient child support. In an ideal world, you and your spouse will be parenting partners that can negotiate a reasonable monthly amount to provide for each of your children. If that’s the position you’re in, you’re very lucky. But if you have an acrimonious divorce, common sense tells you that you need an attorney or arbitrator to ensure that your children are provided for financially.

Another important issue to consider is your health care coverage. Very often, if your company or your spouse’s employer provides health care, it’s less expensive for you, your spouse and your children to be covered under a family plan on one policy. That can’t happen once you’re divorced. In fact, health insurance laws prohibit ex-spouses from being covered under their former spouse’s health coverage.

As the divorce is proceeding, you need to work with your health care insurer (if the health insurance is in your name) to take your spouse off the health care policy. If your spouse has the health care policy, you need to do two things. The first is to make sure that your children are covered under your spouse’s policy. And the second is to shop around for your own health insurance coverage. If you’re employed, check with your Human Resources Department to find out if you need to wait until open enrollment period (usually the last month or so of the calendar year) or if you’re able to get coverage sooner. You cannot afford to go uninsured when it comes to your health (or to become sick and have no affordable access to health care) so this needs to be a very top priority for you.

You should already know that you need a will and a power of attorney, as well as a living will and health care proxy. It’s likely that you’ve designated your spouse as the person with authority to make decisions on your behalf if you’re unable to do so, so you need to decide who that person now should be and update your legal documents accordingly. And if your will provides that your spouse is your primary heir, you should update that to reflect who you want. If you have children who are minors, you also need to consider designating a guardian for them to protect their financial interests in the event of your death before they reach the age of majority.

In our final discussion, we’ll focus on how you deal with your pension and/or 401k, as well as your Social Security benefits.

Women and Divorce – What You Need To Know – Part 1

No one gets married with the thought that it won’t last. But the reality of our world is that – at least in America – 1 out of 2 marriages ultimately ends. And that can be particularly challenging on many levels: emotionally, physically, logistically and financially. Although I’d love to share my thoughts with you on the emotional toll this takes on a person, I’m afraid I don’t have my Love Doctor credentials up-to-date. But I can and will share with you the things women need to consider and manage if your marriage is ending.

What you do and when you do it depends on a lot of things. If you’re an empty-nester, then you can focus on just moving your own life forward. But if you’re a woman with children still at home, that carries with it a lot of additional financial and logistical challenges you need to very carefully consider.

Since one of your main assets is your home, if it’s owned jointly, you’ll need to decide whether you (or your spouse) want to keep it (and buy the other person’s share of the house). With the state of the housing market still in recovery, you may want to consider renting out the house until home values have come back up and you’re in a better position to sell. Or you may decide that selling it now and moving on is the best plan.

Looking at this type of decision in a non-emotional way is often very difficult. It’s easy to see why women (and men, as well) have an emotional attachment to their home. It’s where they raised their children. It is their sanctuary, the place where friends and family have come and shared good times over the years. But it’s important to try and remove the emotion from your decision. The real estate world we live in today is not the world we lived in when you bought your home, whether that was 40 years ago or 5 years ago

Even if you own your home outright, would you (or your spouse) be able to buy the other party out of the home if you or your spouse wanted to stay in it? That might be a very difficult thing to do. And if one of you is able to do that (and let’s assume that’s you), would you be able to pay all of the house bills on your own? A mortgage, real estate taxes, utilities, maintenance? In these days, it’s often difficult enough to keep a house up and running on two salaries. Imagine how difficult it might be to do it with just one salary.

The next thing you need to do is close any type of joint credit cards or lines of credit you have immediately. Faster than immediately if you can. Here’s why. If a debt is in both your names, you are both responsible for it even if only one person actually incurred the debt. And if you have a line of credit, or credit available on a credit card, the other person can – unless the account is closed – continue to add debt to the account, make a late payment or maybe not even make the payment at all. You will be responsible for all of this legally and your credit score will take a hit because of your spouse’s actions.

Get in touch with your creditors and let them know you and your spouse are getting divorced so they can notate your account. Write them a letter confirming that notification and let them know you’re not going to be responsible for any additional debt added to the account. While some creditors may balk at closing down the account without the consent of both parties, you can ask that they suspend charging privileges so that there’s no opportunity for the debt to increase.

Next time we’ll talk about other things you need to mange pro-actively during a divorce, including health care, legal documents and life insurance.

Would You Like a Higher Minimum Wage With Those Fries?

For a few years now, President Obama has been pushing to raise the minimum wage from $7.25 per hour to – after a two year phase-in – $10.10 an hour.  A bill to that effect was introduced into the Senate in 2013 (a lifetime ago in the political landscape). For those of you keeping score, a person making minimum wage working 40 hours a week in this country, the great country in the world, is living at or below the poverty line.  As the President said in his State of the Union address this year, ““To everyone in this Congress who still refuses to raise the minimum wage, I say this:  If you truly believe you could work full-time and support a family on less than $15,000 a year, try it. If not, vote to give millions of the hardest-working people in America a raise.”

Not surprisingly, our broken Congress (or at least the party in power part of it) has not allowed the bill to be brought to a vote in the Senate. In fact, the bill – proposed by Congressman George Miller (a Democrat from California) – to raise the minimum wage to $10.10 over the course of a few years was defeated by a vote of 233 – 184 in the House (with every single Republican representative, 227 in all, voting against it). To at least fix the problem in the federal government, President Obama signed an executive order that, as of January 1, 2015, raised the minimum wage to $10.10 for employees of federal contractors.

(And in February 2013, my state’s current Governor and possible Presidential candidate, Governor Chris Christie, vetoed legislation to raise New Jersey’s minimum wage from $7.25 an hour to $8.50 an hour. Fortunately, New Jersey legislators put the minimum wage increase on the ballot that year as a constitutional amendment and voters not only approved an increase in the minimum wage to $8.25 as of January 1, 2014 but saw it increased again to $8.53 on January 1, 2015 because the constitutional amendment tied the minimum wage in New Jersey to the CPI.)

But that leaves all the rest of the minimum-wage workers in our country in the same dismal financial shape as before. And many people we encounter every single day are making minimum wage, the most obvious and most visible being the hard-working folks at fast food restaurants and big-box stores.

That’s why on April 4 in the past (a day specifically chosen because it is the anniversary of the death of Dr. Martin Luther King, Jr. in Memphis, where he was to support a strike by low-paid sanitation workers) and on April 15 this year (dubbed “Fight for $15”), fast-food workers staged walkouts at such companies as McDonald’s, Taco Bell, Burger King, Domino’s and KFC to lobby not only for a raise in the minimum wage but for the right to form a union.

The walkout was organized by Fast Food Forward, an organization described in the past by Yahoo News as a “coalition backed by labor, religious and community groups”. The director of the organization told Yahoo News that the workers who walked out were asking for the same things as the sanitation workers in Memphis were asking in 1968 – living wages and the right to organize. And this year they are asking employers to pay their workers a minimum of $15 per hour, pointing out that the median pay for fast food workers in New York City (arguably one of the most expensive cities to live in America) is about $18,500 a year, while the fast food industry grosses almost $200 billion annually. In 2013, reports were that about 60 fast food locations were affected by the walkout. While the figures aren’t in on this year yet, initial thoughts are that it was at significantly more locations (including international sites this year).

And as is the case with most jobs that pay minimum wage, fast food workers may not have access to medical benefits so the burden for paying for their own health insurance falls squarely on them. Being able to be part of a union could help alleviate that but, because of the very high rate of turnover in the fast food industry, it has been difficult to get the union movement off the ground.

While many fast food employees tend to be high school and college students, there are also older Americans who work at these places that many of us frequent on a daily basis for our cup of coffee, or a quick cheeseburger at lunch, or to get pizza delivered to our home at night. So while it may be easy to dismiss a walkout like this as an empty gesture, paying a living wage to workers is still an issue that needs to be faced.

In this economy, people expect more for their ever-shrinking dollar (which may be why you see fast food companies putting more items on their dollar menu, to entice more customers) and you can certainly see a company’s dilemma, facing consumer demand for lower prices coupled with employees’ protesting for higher wages. It’s a fight not likely to go away soon.  It seems like the push-and-pull of management v. labor on the issue of increasing the minimum wage is going to continue for the foreseeable future. But here’s the thing.

What legislators (and the people who run fast-food companies and big box stores) don’t seem to get is that people who make more money can spend more money. Money put back into the economy makes the economy grow and if you have more disposable income to spend, you spend it. I learned this in Economics 101 at the great St. Francis College in my freshman year back in the old days. Why people still don’t get this, I don’t know. What I do know is that someone who surely doesn’t get it is the co-founder of Burger King, David Edgerton. Apparently he doesn’t want Burger King workers to have it “your way”.

In an interview with Time Magazine this week, Edgerton was quoted as saying that if you raise the minimum wage to $15 an hour, “You’re not going to get these dollar hamburgers anymore that both Burger King and McDonald’s had. I see a lot of $10 hamburgers arriving on the scene.” Oh, the horror.

I’ve had high-paying jobs and low-paying jobs and some that fall somewhere in the middle. It doesn’t make me a genius to know that you can’t support a family on $7.25 an hour (or even on $8.53 an hour in New Jersey). And it seems to me that, invariably, the loudest voices decrying this movement come from people who haven’t worked for a minimum wage in many years, if ever. And guess what? People who make a living wage are less likely to need government assistance to survive, another hot-button topic with many of the powers-that-be who don’t get what it’s like to scrap and scrape and scramble every day to survive when you make minimum wage.

So why are we still having this discussion?

Renting a Car? Here’s How to Save Money

If you’ve got a vacation planned or a business trip coming up or even going out of town to visit someone for a day or a weekend, you might be thinking about renting a car. And the more you know ahead of time about renting a car, the more money (and aggravation further down the road) you can save.

As with airline frequent flyer miles, loyalty gets rewarded so sign up for a rental car company’s membership program. There’s usually no charge and it can reward you with discounts, credits towards a linked frequent flyer program and an easier rental experience as it saves your preferences so that you can rent a car more quickly.

Unless you’re traveling with a circus or the 19 (20? 21?) Kids And Counting crew, always rent the smallest car offered to you. First, it will be your least expensive option and, more importantly, the small cars almost always sell out so that – when you show up to the rental counter at your destination – if they don’t have a small car for you, you’ll be upgraded to a bigger car at no additional cost to you.

The rental car company should always be giving you a car with a full tank of gas; that’s a given. Never ever select the option that allows you to return the car half empty and allow the rental car company to refill the tank. You could pay almost double the amount you’d pay at a gas station if you let Avis or Hertz top off the tank when you return the car. And please, no matter what else you do, don’t smoke in the car. Virtually every car company has a no-smoking policy and you can be charged a cleaning fee (sometimes as high as $250) if a car company determines upon the return of the vehicle that you or one of your passengers has been smoking in the car.

If you’re 110% sure your plans are not going to change, consider opting for the pre-pay selection on a rental car site. You can save as much as 30% off your rental by paying in full upfront. All the major players (Alamo, Hertz, Budget and Avis) offer them and, although they do allow some flexibility, you will be hit with penalties if you cancel or change the reservations.

And we all know that it’s very convenient to rent you car at the airport so that you don’t have to grab a cab to go to an offsite rental counter. But you pay for that convenience, usually with higher rates and most definitely with something labeled an airport fee. If your time is more valuable, definitely select the airport option but consider that many hotels have onsite car rental counters and – if your hotel offers a shuttle – take that, rent the car at the hotel and save some money. (And if you’re headed to one of the major theme parks across the country, they almost all have rental car partnerships with locations very near their sites so you can pick up a car – at almost always a lower cost than at the airport – near the theme park. Alamo, for example, has a rental car location just outside the gates to Disney’s Magic Kingdom in Orlando).

If you’re offered insurance coverage by the rental car company (or if you’ve declined it when making an online or phone reservation but are offered it again by the counter staff when you pick up your car), you can feel fairly comfortable declining it. Typical auto insurance policies will cover you for any car you rent domestically (but check in with your agent to confirm that). Most auto policies will not cover rentals outside the United States but you may be able to purchase a rider through your insurer for that coverage at a far lower cost than what the rental car company will charge you. Selling rental car insurance is a huge profit center for car companies so don’t be sweet-talked into buying something that you usually don’t need.

In the same way that shopping in bulk at a shopping club might save you money, you can also save money by renting a car for a week as opposed to 3 or 4 days. You can try various combinations of rental days when making a reservation but the typical rule is that – once you hit a 5-day rental, selecting a weekly rental is going to cost you (on a per day basis) significantly less than a daily rental. And don’t assume that once you make a reservation, you can’t change it. Whenever I’ve made a car reservation, I’ve gone back weekly to check rates for the same time period as my original reservation and, more often than not, ended up with a better deal. If you can find a less expensive deal, book it and then just cancel your original reservation.

Making a rental car reservation online is one of the easiest parts of planning a vacation or business trip. All of the rental car companies have made it incredibly easy to make, change or cancel a reservation in a relatively short period of time. Find the rental car company that works for you, join their loyalty program and start driving.

When Planning Your Estate, Remember to Include Your Digital Legacy

Because you’re a smart and savvy person, you already know that it’s vital for you to manage and keep your estate plan up-to-date.

You know you need a will and a living will. If you’ve got children, you need to appoint a guardian for them, should you die before they reach the age of majority. You need a financial power of attorney and a health proxy as well. And you need to revisit all of these documents every year or so to make sure the decisions you’ve made are still accurately reflecting your and your family’s desires and best interests.

And your will is the place to provide how to dispose of your tangible assets, like your money, your home, your jewelry, your collectibles. But have you ever thought about your digital legacy and how you want to have that handled after you’re gone?

Up until a few years ago this is not something that we even had to think of. But now there are so many different types of virtual and digital media that you’re likely to have content on at least one of them. Think about it.

Do you have a Facebook account? What about Twitter? Do you have a professional profile on LinkedIn? Do you post photos on Pinterest? Are you a subscriber to Google+? Do you write a personal blog? Have you ever sold anything on eBay? Do you have an iTunes account? Have you ever posted a video on YouTube?

If you can answer “yes” to any of those questions then you have a digital legacy and you need to decide how that legacy will be managed when you’re gone and who will manage it for you. Some companies have policies on this, some don’t, so it’s up to you to be proactive and come up with a plan to be executed by someone you trust.

It’s worth checking the various sites to see what their policy is. For example, Google has something called an “Inactive Account Manager” which lets you decide when your account should be made inactive (you designate how long a time period from the date of your last log-in) and who should be notified when the account has been designated as inactive. It can cover such things as YouTube, Google+, GMail and Google Voice.

There are other sites like Password Box (formerly called Legacy Locker) that you can download and which allow you (at no cost for limited access) to enter all of your login information – user names, passwords, access keys, etc. – into your account and then designate who should be given access to that information. It runs both on a desktop computer and on a smart phone via an app. And I’m sure they’re a fine service but there’s no guarantee they’ll still be in business when your designated rep needs access to your information (although they have just announced that they’ve partnered with Intel Security so that’s a good sign that they may be here to stay).

One concern that you might want to consider is that – if you download the app – Password Box’s description says that you can “securely store, retrieve and share passwords and other personal data anytime, anywhere, on any device”. But what happens if your phone falls into the wrong hands and you’ve stored all of your credit or debit card information on the Password Box app or your checking account password? I don’t know and – in my humble opinion – Password Box’s website is a little non-specific on this issue or at least a little too non-specific for my liking.

And just in the last few weeks, Facebook has finally allowed users to designate a “legacy contact” who will be your virtual exeutor of your Facebook page. By logging into the Settings area of Facebook and selecting Security, you’ll now find a Legacy Contact area where you’ll designate someone you trust and send them a Facebook-created e-mail letting your chosen one know they’ve been selected. (Of course, it might be a good idea if you give this person a heads-up before you send him or her the e-mail so they don’t get the wrong idea and think the end is near). If your legacy contact accepts, they’ll be able to post on your page after you’re gone.

If you want to take advantage of the shortcuts that social media gives you to manage your digital legacy, feel free but I would also suggest doing exactly what I spent about an hour doing not that long ago. Create a document that shows all the websites (social media, banks, insurance, mortgage company, etc.) that you routinely use and then list your log-in information and your password. Set up a password so that only you (and whomever you designate) will be able to open the document, make 2 copies of it (put one in your safe deposit box and give one to your designated representative) and keep it current. Your virtual life will thank you.

More detailed suggestions of how to do this can be found at Nolo.com (a great website that helps consumers find answers to everyday legal questions). Whether you do it yourself or access the services of the digital companies that I’m sure will continue to pop up, it’s so very important that you not only protect your digital assets but make sure that those who love you can protect them after you’re gone.

Life Insurance – No Matter What Your Situation, You Need It.

Life insurance is one of those topics we don’t like to think about or talk about. Thinking about it means you’re facing your own mortality. But the reasons to have it are many and – no matter what your situation – it’s one of the most basic things we can do to protect our loved ones.

Many people who work have the option of purchasing a life insurance policy through their company equivalent to some multiple of their salary at a relatively low-cost (because it’s group coverage). But if you leave your job, the coverage doesn’t follow you. And if you retire from your job, you may be able to continue the coverage but for a much higher rate (or for much less coverage).

So relying upon life insurance from your company – particularly in our still-recovering economy where none of us is guaranteed a job tomorrow – is not enough. Whether you’re single, or married but have no children, or a stay-at-home parent with no income coming in, or a retiree on a fixed budget, you still need to buy life insurance.

Think of the situations your loved ones can and will face in the event of your death. Some of the costs are obvious. There are the emotional and financial costs of a funeral. It can be very easy to run up many thousands of dollars in costs for a funeral from the fees charged by funeral homes and cemeteries, to the costs for flowers and limousines. Having life insurance available to defray some of these costs will be a great help to your loved ones (at a time when not only are they particularly vulnerable but might not be at their most clear-headed in making sound financial decisions).

It’s also possible that someone who dies may have unpaid medical bills and these don’t disappear just because the patient has died. The proceeds from life insurance policies can be used to settle these debts.

If you own your house and have a mortgage, unless your bank has required you to have private mortgage insurance, the balance of the mortgage will become due if you die. If you want your house to pass to your heirs free and clear of debt, it’s imperative to have life insurance in a sufficient amount to cover that debt (and any other debt you may owe as well, whether it’s credit cards or a car loan or student loans).

Particularly when you have a family, whether you work outside the home or are a stay-at-home parent, replacing your lost income (or the value of all you do for your family) should you die is imperative. Being able to provide a regular source of income that will allow your family to stay in their home, or your children to go to college, is one of the great benefits of having life insurance. If you’re retired and living on a pension or Social Security benefits, it’s likely your spouse would lose some of those benefits upon your death and life insurance can help fill that gap.

The sooner you purchase life insurance, the less expensive it will be. Term life insurance is one of the least expensive options you can pursue and if you’re in relatively good health and don’t smoke, you can get an excellent premium that will secure you a significant amount of coverage. You can easily get a quote through a site like SelectQuote Life and get help making an informed decision not only about how much life insurance you need but how to buy it at a premium you can afford.

Protecting your family and your assets is one of the greatest gifts you can give to them. It’s never too soon – and it’s never too late – to look into buying life insurance or buying more life insurance.

Sharpen Your Pencil and Start Working on Your Taxes

We’re all busy in our lives and it’s all too easy to put off until tomorrow what you can at least start today but it’s still worth taking a quick look at your taxes now. Even if your current plans are to file on the last possible day or file for an extension, spending some time to take a look at your tax situation can help you decide whether there’s some reason to file sooner, or if there’s something you can still do to lessen your 2014 tax bill (or increase your 2014 tax refund).

If you have your last pay stub from 2014, and have kept a running list of your charitable contributions for last year, and can get on your bank’s or financial institution’s website and see what your earned interest was for 2014 or what your mortgage interest was last year, then you already have most of what you need to take a quick tour through any of the online tax sites and start plugging in some preliminary numbers. (Although by now, your employer and financial institutions should have sent you either electronically or by snail mail your actual numbers).

And in this, the first full tax year after the Affordable Care Act went into effect, there may be some financial impact on your tax return if you’re one of those people who received a federal subsidy towards the cost of your health insurance so finding that out sooner rather than later is probably a good idea. According to a recent article on the CNBC website, what was commonly called a federal subsidy (based on your estimates of what your income was likely to be the following year) is more precisely an advanced tax credit. So if you got your health insurance through one of the exchanges and were eligible for a federal subsidy, now’s the time to find out what you estimated your income to be last year and compare it to your actual 2014 income. If you underestimated your income by too much, your 2014 refund (if you’re owed one) is likely to be reduced to pay back some of that advanced tax credit.

So if you’re expecting a refund this year because you’ve had too much withheld from your taxes (or you’re one of the many people who would rather have the government hold on to your money and give it back to you in one lump sum come tax time), then this exercise will get you moving faster and is of the most benefit to you. The longer one waits to file their tax return, the busier the IRS gets so filing sooner – especially if you’re expecting a refund – gets you your money faster.

There’s still an opportunity to fund your IRA by April 15 in order to use that as a tax write-off on your 2014 taxes. If – after plugging in your preliminary numbers – it becomes apparent to you that you will likely owe income taxes, here’s your opportunity, by having crunched the numbers early, to fund that IRA and lessen the amount you’ll owe come April 15.

Another reason to take a run at completing your taxes early is that life can – and usually does – get in the way. It’s far too easy to procrastinate and think you’ll have plenty of time to do them but who knows what’s going to happen in your life over the next few months?

Do you really want to wait until April 14 to look at your taxes and discover that you owe money (and don’t have the resources to pay what you owe)? Or find out that you don’t have the information you need to complete your taxes because perhaps you’ve misplaced something or don’t have a record of getting certain info from your financial institution? Or make a mistake in your rush to file on time that could result in you overpaying or underpaying your taxes, and then be subject to a penalty?

So the bottom line – as is usually the case – is that the early bird catches the worm. Time spent now means less time spent later, less aggravation, less stress, less worry. And less in this case is definitely more.