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September 2020 Posts

The Things We Get Wrong Planning for Retirement

The Things We Get Wrong Planning for Retirement

 

By Kylee Hale

Wednesday, September 16, 2020

Guest Post by: Kerry Hannon Kerry Hannon

It's always a pleasure to share posts with like-minded people. Kerry Hannon is a respected advocate  of financial empowerment for women. When she accepted my invitation to share her wisdom with our readers, I was thrilled. I know you will be too.

The Things We Get Wrong Planning for Retirement 

5 ways to get them right for a more financially secure future

Lots of retirees have regrets about their retirement choices. The primary problem: they were too optimistic about their anticipated retirement benefits, which led to them not saving enough during their working years.  If they could go back in time, they’d have postponed retiring, paid off debts before leaving the workforce and learned more about personal finances.  Those are some of the findings in the recent intriguing study, “Subjective Expectations, Social Security Benefits, and the Optimal Path to Retirement,” by University of Southern California researchers María J. Prados and Arie Kapteyn, who culled data from more than 4,632 adults. 

21% said the Social Security benefits they got were substantially different than what they expected; most expected more.

The USC researchers also found that women were more likely than men to have been overly optimistic about retirement-benefits expectations. As a result, men “are more likely to save more and reach retirement better prepared,” the authors wrote.  And lower-educated people were more likely to be overly optimistic, too. 

“What’s concerning about these findings is that the more vulnerable groups (lower-educated people and women) are the ones who seem to be more optimistic about their future retirement benefits,” says Prados, an economist at the Center for Economic and Social Research at USC.  “Being mistaken in this way is costly for these groups because it makes it more difficult for them to realize they need to prepare to be appropriately ready for retirement,” she notes. “Given the complexity of how benefits are determined, it is not surprising to see an educational and socioeconomic gradient in these misperceptions.”   

About 20% of the retirees in the survey regretted claiming Social Security benefits as early as they did and 21% said the Social Security benefits they got were substantially different than what they expected; most expected more.  Alarmingly, more than 50% of the non-retirees said they don’t have a good estimate of their future Social Security benefits.  It doesn’t have to be that way.  There are a number of things you can do before you retire to avoid making these mistakes. (More on them shortly.)

Part of the gender differences in retirement-benefits expectations are “explained by differences in levels of financial literacy. Improving financial literacy among women would be helpful,” Prados says.  Bolstering the need for more retirement planning knowledge are three other reports released this summer.  A U.S. Government Accountability Office report to the U.S. Senate’s Special Committee on Aging found that all of the 190 women (most over 70) who participated in its focus groups said their lack of personal finance education negatively affected their ability to plan for retirement.  A study called The Four Pillars of the New Retirement, from the AgeWave think tank and the Edward Jones investment firm, surveyed 9,000 people in the U.S. and Canada and uncovered serious ignorance regarding future expenses in retirement. (Full disclosure: I was interviewed for the report.) 

“Almost 70% of those who plan to retire in the next 10 years say they have no idea what their healthcare and long-term care costs will be in retirement,” the study said.  Finally, new research from Morningstar Investment Management, Estimating ‘The End’ of Retirement, found that investors often misestimate their average lifespan, which could have a detrimental effect on their ability to successfully retire.  According to Morningstar, a retirement period of 30 years (to age 95 or so) is a reasonable assumption for the average 65-year-old heterosexual couple retiring today. But, the authors say, households with higher incomes have longer life expectancies than those with lower incomes, an effect that has been widening in recent years.

Here are five ways to avoid getting big things wrong when planning for retirement:

1. Ratchet up your expected life span for planning purposes. “A big issue is forgetting that you may live to be ninety-eight and then starting to run out of money,” says Cindy Hounsell, president of the Washington D.C.-based Women’s Institute for a Secure Retirement (WISER) and a Next Avenue Influencer In Aging.  “People also forget about inflation-increased property taxes, chronic health costs and caregiving out-of-pocket costs.”  To estimate your life span, try out the Longevity Illustrator online tool from the American Academy of Actuaries and the Society of Actuaries.

2. Get an estimate of your future Social Security benefit. You can do that by signing up for a free mySocial Security account on the Social Security Administration site. It will give you personalized estimates of your future Social Security retirement benefits based on your earnings history as well as a way to correct any errors in Social Security’s data for your earnings.  “Your statement’s an essential financial planning tool to help estimate income in retirement and figure out how much money you will need to supplement your Social Security benefits to pay bills and future costs,” Hounsell says. 

“I like clients to start preparing for retirement at least ten years out,” Braxton says.

And, she adds, getting the Social Security benefits estimate will give you a better idea how much you’ll need to save between now and retirement to supplement those benefits.

3. When reviewing your Social Security estimated benefits, learn how much more you could receive by delaying claiming benefits past your Full Retirement Age (which is between 66 and 67 depending on when you were born.)  Pushing them back can bump up your benefits by 8% annually, until age 70.  Lazetta Rainey Braxton, the Brooklyn, N.Y.-based co-CEO of the financial planning firm 2050 Wealth Partners, says many people don’t understand that working a little longer to be able to afford delaying Social Security can wind up paying off.

4. Create a retirement lifestyle budget plan. Braxton says, ask yourself: What is your budget? What expenses will you carry into retirement and what new expenses can you expect to incur?  “I like clients to start preparing for retirement at least ten years out,” Braxton says. “Five years at the minimum.” That way, you can factor in where you’ll want to live in retirement, the cost of living there and your likely streams of retirement income.

5. Women: take an active role in financial planning if you’re not doing so. “The finding from the USC researchers indicating that men are less likely to overstate their retirement benefits than women may also be because of traditional gender roles in many marriages and coupled relationships where men do the financial planning,” Hounsell says.  Thankfully, she notes, “This may be changing as more women are primary breadwinners and have equal financial planning roles.” 

For unbiased guidance, look for a fee-only financial planner with the Certified Financial Planner designation. You can find one by visiting sites of The National Association of Personal Financial Advisors, The Financial Planners Association and The Certified Financial Board of Standards.

The three key takeaways from these recent retirement studies, says Hounsell: “Plan for more income than you think you will need; get better informed and retire later.”

 

Kerry Hannon is the author of Great Pajama JobsYour Complete Guide to Working From Home (cover image to right, that's Kerry and her pooch). She has covered personal finance, retirement and careers for The New York Times, Forbes, Money, U.S. News & World Report and USA Today, among others. She is the author of more than a dozen books including Never Too Old to Get Rich: The Entrepreneur's Guide to Starting a Business Mid-LifeMoney Confidence: Really Smart Financial Moves for Newly Single Women and What's Next? Finding Your Passion and Your Dream Job in Your Forties, Fifties and Beyond. Her website is kerryhannon.com. Follow her on Twitter @kerryhannon.


Blog Topics: 
BudgetingInvesting 

Social Security and Disability

Social Security and Disability

 

By Kelly Griese

Wednesday, September 9, 2020

This week, I’m continuing to learn about financial issues related to disabilities, and as with my previous post, I’m attempting to share this information with all of you in a simple, easy-to-understand way. This is no small feat. Navigating this large and complex subject takes time, applying for these benefits takes time, and as I often tell folks who attend my presentations: time is money. When you need financial assistance, you need it ASAP. 


Compassionate Allowances

Enter the Compassionate Allowances program from the Social Security Administration (SSA), which seeks to expedite the process by quickly identifying severe medical conditions and diseases that meet Social Security’s standards for disability benefits. (My last blog post discussed both Social Security Disability Insurance and Supplemental Security Income.) 

Just last month, Social Security added five new Compassionate Allowances conditions. The list currently includes 242 conditions, including certain cancers, adult brain disorders, and a number of rare disorders that affect children. The list of conditions that qualify continues to grow, and you can even submit a condition for consideration. 

The purpose of the Compassionate Allowance program is to reduce the waiting time to reach a disability determination, which is necessary for you to start receiving benefits. Regardless of your condition, there is a waiting period between when you apply for benefits and when you begin receiving them. 


How Long Does It Take?

There are numerous factors that determine how long it takes to begin receiving disability benefits.  SSA breaks it down in their Frequently Asked Questions, but big factors include the nature of your disability and how long it takes to get medical evidence of your disability. All that said, if you are eligible to receive disability benefits, there is a five-month waiting period. SSA will pay your first benefit for the sixth full month after the date they find out your disability began. That means if your disability began today, September 9, 2020, your first benefit would be paid for the month of March, 2021. 


How Much Will You Receive? 

To figure out how much you will receive, SSA recommends you start by creating a My Social Security account. It’s pretty easy to create an account. I just did it myself online, and it only took a few minutes and some basic information, such as my driver’s license number and a few pieces of information from my last W-2. Creating a My Social Security account allows you to access your statement online. It will provide you with your estimated benefits and earnings record. It also has a retirement calculator to help you make the most of your earning years. You can even use the site to request a replacement Social Security card. But what’s important for the purposes of this blog post is the Social Security Statement. You can download a PDF of this document once you’ve created a My Social Security account. The statement tells you if you have earned enough credits to qualify for disability benefits and what your payment would be right now if you became disabled. I’ll go ahead and use myself as an example. I’m currently eligible to receive $1,937 per month if I were to become disabled. 


How to Apply

Before I explain how to apply for Social Security disability benefits, I recommend you check out SSA’s Disability Starter Kit. It includes a fact sheet with answers to common questions about disability benefits, a checklist of all the documents and information you will need to provide to SSA, and a worksheet to help you gather and organize everything. There are adult and child versions of this starter kit, and it’s available in English and Spanish. SSA also offers free interpreter service if English is not your primary language. 

Now back to applying for disability benefits. Remember, as I said before, there’s a waiting period for receiving disability benefits, so you should apply as soon as you become disabled.  You can apply online, or you can apply by calling 1-800-772-1213. SSA stresses that you should not delay applying for benefits if you don’t have all the necessary documents. They will help you get these documents. 

You are going to need to provide Social Security with a LOT of information when applying for disability benefits. This will take time, and you may want to ask for help. A friend or family member is allowed to apply on your behalf, and SSA will then follow-up with you to sign necessary documents. Additionally, there are numerous social service workers, disability advocates, and organizations who can assist you in this process. 


More Information

SSA has published a lot of information on the subject of disability. I recommend bookmarking this link to a search of the word “disability” on their publications page. 


Blog Topics: Budgeting

What Your Credit Score Says About You

What Your Credit Score Says About You

 

By Kylee Hale

Wednesday, September 2, 2020

Many people do not monitor their credit or know much about the credit scoring system until they attempt to make a big purchase. Buying a home or starting a business can require a large amount of money and often a loan. Each individual has a credit score. This is a three digit number that lenders use to determine how likely it is that an individual will pay back the loaned amount. A person’s credit score is also used by the lender to determine the interest rate. To the lender, a credit score is like a report card reflecting a person’s success of being financially responsible.

If you are married you and your spouse each have your own credit score. If you co-sign on a large purchase together, both individual’s score will be checked. Credit scores range from approximately 300 to 850. The lower the credit score the riskier it is for a lender to loan money, and it’s less likely the lender will grant the loan. If a loan is approved on a lower credit score, the loan will cost more overall. When it comes to locking in an interest rate, the higher the score, the better your terms of credit will likely be.

To obtain your own credit score you can request your score (for a small fee) and your credit report (for free) from annualcreditreport.com. Many credit card suppliers will provide you a free estimate of your credit score as a benefit. A credit report shows details about the lines of credit that you have established or have had within the past few years. A credit report is available for you to request without charge, once a year, from each of the three main credit bureaus. So you can monitor your credit on a regular basis if you space your request out obtaining one report each quarter of the year.

The most well-known credit scoring system was developed by Fair Isaac Corporation and is called the FICO score. The three major credit bureaus, Equifax, TransUnion and Experian, use the FICO scoring model for their proprietary systems. Since each scoring system uses a slightly different statistical model, your score from each of the three will not be exactly the same. This is because lenders and other businesses report information to the credit reporting agencies in different ways, and the agencies may present that information through their proprietary systems differently. Because different lenders have different criteria for making a loan, where you stand depends on which credit bureau your lender turns to for credit scores.

Composition of a Credit Score

Each individual’s credit score is determined by taking five components into account. Below is a chart of the components and the corresponding percentage of how much each component affects the overall credit score. 

Component Component Weight
Payment history 35%
How much you owe 30%
Length of credit history 15%
Type of credit 10%
New credit (inquiries) 10%

Payment History pertains to an individual’s track record of paying back debts on time. This component encompasses payments on credit cards, retail accounts, installment loans (such as automobile or student loans), finance company accounts and mortgages. Public records and reports detailing such items as bankruptcies, foreclosures, suits, liens, judgments and wage attachments also are considered. A history of prompt payments of at least the minimum amount due helps your score. Late or missed payments hurt your score.

Amounts Owed or Credit Utilization reveals how deeply in debt you are and contributes to determining if you can handle what you owe. If you have high outstanding balances or are nearly "maxed out" on your credit cards, your credit score will be negatively impacted. A good rule of thumb is not to exceed 30% of the credit limit on a credit card. Paying down an installment loan is looked upon with favor. For example, if you borrowed $20,000 to buy a car and have paid back $5,000 of it on time, even though you still owe a considerable amount on the original loan, your payment pattern to date demonstrates responsible debt management, which favorably affects your credit score.

Length of Credit History refers to how long you have had and used credit. The longer your history of responsible credit management, the better your score will be because lenders have a better opportunity to see your repayment pattern. If you have paid on time, every time, then you will look particularly good in this area.

Type of Credit refers to the "mix" of credit you access, including credit cards, retail accounts, installment loans, finance company accounts and mortgage loans. You do not have to have each type of account. Instead, this factor considers the various types of credit you have and whether you use that credit appropriately. For example, using a credit card to purchase a boat could hurt your score.

New Credit (Inquiries) suggests that you have or are about to take on more debt. Opening many credit accounts in a short amount of time can be riskier, especially for people who do not have a long-established credit history. Each time you apply for a new line of credit, that application counts as an inquiry or a "hard" hit. When you rate shop for a mortgage or a car loan, there may be multiple inquiries. However, because you are looking for only one loan, inquiries of this sort in any 14-day period count as a single hard hit. By contrast, applying for numerous credit cards in a short period of time will count as multiple hard hits and potentially lower your score. "Soft" hits—including your personal request for your credit report, requests from lenders to make you "pre-approved" credit offers and those coming from employers -will not affect your score.

Good credit management leads to higher credit scores, which in turn lowers your cost to borrow. Living within your means, using debt wisely and paying all bills on time, every time are smart financial moves. These lifestyle choices help improve your credit score, reduce the amount you pay when you need to borrow and put more money in your pocket to save and invest.

Some information in this article was extracted from a FINRA publication.


Blog Topics:
Credit

August 2020 Posts

Disabilities and Finances

Disabilities and Finances

 

By Kelly Griese

Wednesday, August 26, 2020

This week, I’m doing a lot of learning… or at least trying. I started researching the subject of finances as they relate to persons with disabilities after seeing something I didn’t understand on my Facebook feed. It was a meme about income and asset limits for someone receiving disability assistance from the government. As an investor education coordinator, my mind first turned to investing, so I Googled “SSDI and investing income.” The search hurdled me through a rabbit hole of results and more questions. 

Allow me to pause for a moment and stress that I am non-disabled, and I do not have any immediate family members with disabilities, so I’m not a special needs expert. 

I intend for this week’s blog to be an introduction to the topic of finances as they relate to persons with disabilities. I also intend to write additional posts that take a deeper dive into some specific issues, and these future posts will include interviews with caregivers, persons with disabilities, and experts. Here are some of the issues I hope to explore: 

  • Working and income 
  • Investing and saving for the future 
  • Social Security and Medicaid 
  • Financial planning 

Statistics 

Now for some statistics regarding employment, income, and financial stress. These findings from FINRA’s national financial capability study of adults with disabilities are eye-opening. Keep in mind, these stats are from a 2017 survey – nearly a decade after the Great Recession of 2008 but before the current Coronavirus pandemic. 

  • 1 in 9 working-age adults (18-65) have a disability. Of those, only 1 in 3 are employed. 
  • Persons with disabilities are almost 2 times more likely to have an income less than $35,000, and 26 percent of survey respondents with disabilities had household incomes below $15,000. 
  • Less income equals more financial stress. Persons with disabilities are almost 3 times more likely to have extreme difficulty paying bills, and 55 percent of survey respondents say they wouldn’t be able to come up with $2,000 to cover an emergency expense. 

Resources

It’s not all bad news. There are resources available that can help. Programs like Section 8 housing vouchers, Supplemental Nutrition Assistance Program (SNAP), and Low-Income Home Energy Assistance Program are available to qualifying low income families, but they can also help alleviate some of the financial strain of having a disability. Other programs are specifically designed to assist Americans with disabilities. 


SSDI and SSI

Social Security Disability Insurance (SSDI) provides benefits to people who have made contributions to the Social Security Trust Fund but are now unable to work due to a qualifying disability. Currently, the average disabled worker receives $1,258 per month. The amount received is based on average lifetime earnings, not on household income, financial resources, or how severe your disability is.  To receive SSDI, you must be deemed disabled and unable to work. 

SSDI is different from Supplemental Security Income. SSI provides monthly cash assistance to disabled or elderly people who have financial needs regardless their work history. Currently, SSI’s maximum monthly payment is $783 for an eligible individual, $1,175 for an eligible individual with an eligible spouse, and $392 for an essential person.

Investopedia did a great job of explaining these two types of benefits in an easy-to-understand way, and their blog post walks you through the evaluation process. I highly recommend you give it a read if you or someone you know might be eligible to receive these benefits.

The National Council on Disability has a LOT of content related to financial assistance and incentives. You can find their publications here


ABLE Savings Accounts

An “inability to work” is required for both SSDI and SSI benefits. That means earning too much money can endanger someone’s ability to receive critical financial support. Plus, SSI has asset limits that serve as a disincentive to save. 

Enter ABLE savings accounts. The name ABLE comes from the Achieving a Better Life Experience Act of 2014. ABLE savings accounts allow qualified individuals with disabilities to save money and not risk losing vital public benefits, such as SSI or Medicaid. And these savings accounts are tax-advantaged. I asked the Indiana Treasurer’s office for some more information, and they told me about INvestABLE Indiana, our state’s 529A savings option. 

Persons with disabilities can use ABLE accounts to save money and pay for disability-related expenses, including education, transportation, housing, and medical needs. Similar to 529 education savings plans, 529A contributions can be made by anyone, including the account owner, family, or friends. To be eligible, the account holder must have the onset of disability prior to age 26 and be receiving SSI or SSDI. If the account holder is not receiving SSI or SSDI, they will need to receive a doctor's diagnosis of significant functional impairment. The staff at the Indiana Treasurer's office can answer any questions you might have. 

I plan to write a lot more about ABLE savings accounts in a future blog post. 


I've barely scratched the surface when it comes to financial resources for persons with disabilities. It's a complex subject, and there's no one-size-fits-all assemblage of resources to address the needs of this large and diverse community. There's a lot to navigate when it comes to living with a disability, and not all of it is easy to understand. Financial planning can be difficult for caregivers and those who are differently abled. Based on the statistics outlined in this post, it's clear that persons with disabilities and their families are impacted more significantly than many of us may know. I will continue to educate myself and in turn educate you. Hopefully, through future posts, I can provide you with a starting point for addressing financial issues related to disabilities. If you believe I’m missing anything or have thoughts on future topics for discussion please reach out.   


Blog Topics: Budgeting

Working Hoosiers Beware of Identity Theft

Working Hoosiers Beware of Identity Theft

 

By Kylee Hale

Wednesday, August 19, 2020

ID Theft

When the pandemic hit, we pretty much entered a new recession, cancelling out most of the employment gains from the last 10 years. An improvement from April, the United States unemployment rate in June was 11%. That is higher than it’s been any time in the last 70 years. Whether returning to work or finding a new way to make an income, there is one thing we all still need to worry about: identity theft.

Thousands of Hoosiers have been impacted by thieves using stolen information to cash in on funds from the federal CARES act passed by Congress. The CARES act money is supposed to help those who are unemployed during the pandemic. An investigation by 13News  reveals three Indiana residents who were caught off guard and alarmed to find their information had been used to make an unemployment claim.

 "I was shocked," said Lola Best, as she found out her personal information had been registered under someone else’s account with the Department of Workforce Development (DWD). 

Rosemary McQueary of Noblesville also stated that she no idea how her information ended up in the system as she is very careful. 

Another Indiana man found out he was a victim of identity theft when he received a letter from the DWD requesting he pay back a ten thousand dollar overpayment. He tried to make an account on the Department’s website and was notified his social security number was already in use.

To the average Hoosier, it may be concerning to find that the DWD may not have cross-referenced data to confirm matching birthdates and legitimate information for claims filed. However, there is no system for the Department to verify employment information for claims made under the Pandemic Unemployment Assistance fund. In times of emergency when there is pressure to help those in need as quickly as possible, it’s likely for some errors to occur.

Be Alert Identity Theft

The Department has taken a number of steps to combat the issues and is now cross-checking the applicant’s contact information that is provided when a claim is filed. In August, the Department sent an email to claimants to update their password and check their account status in the system. Additionally, the DWD does not hold victims of identity theft liable for any overpayment.

A recent FBI article expressed the increased amount of fraud reports regarding stolen personally identifiable information used for unemployment insurance claims during the COVID-19 pandemic. Buying stolen information online, data breaches, cold-calling impersonations, email phishing, and obtaining data from public websites are all ways for fraudsters to get their hands on personal information.

There are a few things that can tip you off to a scam. Any type of communication regarding unemployment insurance or payout, if you have not filed a claim, should be a red flag. Be sure to monitor your bank and credit card statements for suspicious transactions related to unemployment benefits. Unsolicited inquiries in any form should be ignored or reported.  Lastly, beware of links and fake look-a-like sites made to mirror government agency websites. You can check the resource by hovering over a link to see where it redirects to and/or directly looking up the agency to confirm you have the legitimate government website.

If you think you are a victim, report unauthorized transactions and contact the three major credit card bureaus: Experian, TransUnion, and Equifax. It’s best to regularly check your credit. Placing a freeze on your credit will protect you from identity theft. Activating a credit freeze is free and secures your information so no scammer can open a line of credit in your name.  The Indiana Attorney General has a website for helping Hoosiers set up security freezes, here is the link.  Fraud cases can be reported to Indiana State Police, DWD, the IRS, credit bureaus, and your human resources department. The FBI also encourages victims to report fraudulent or any suspicious activities to the Internet Crime Complaint Center at ic3.gov . Also, you can use the Federal Trade Commission’s resource, identitytheft.gov, for help reporting and recovering from identity theft.

It’s unfortunate that bad actors are taking advantage of a pandemic. Know that scammers will always try to play on a victim’s emotions. Taking protective measures, like putting a credit freeze in place will stop scammers in their tracks. Remember that if it sounds too good to be true it probably is, and if you think you’ve been a victim of fraud, report it to the authorities.


Blog Topics:
Fraud Prevention

Government Impostor Scams

Government Impostor Scams

 

By Kelly Griese

Wednesday, August 12, 2020

“I’m from the government, and I’m here to help.” President Reagan called those the nine most terrifying words in the English language. And when it comes to government impostor scams, I agree.

According to our friends at the Better Business Bureau (BBB), one of the most common scams in the U.S. and Canada involves callers pretending to be government officials. They claim to be tax officials, representatives from the Social Security Administration, police officers, and even Centers for Disease Control and Prevention (CDC) officials. The criminals demand money and personal information. They often threaten legal action and imprisonment. We’ve talked before about con artists using fear and intimidation to manipulate their victims. Such tactics often cause us to stop thinking logically and react quickly on instinct. 

The Federal Trade Commission produced a video about how government impostor scams work and offers examples. 

Reports of government impostor scams fluctuate, but BBB says they’re growing more diverse and more sophisticated. BBB just released a new investigative study on government impostor scams that you can read by visiting BBB.org/FakeGov. According to a recent AARP survey, 44% of Americans say they’ve been contacted by fraudsters posing as government officials. And the FTC says victims of government impostor scams report losing $450 million since 2015. 


Remember, if the call is really from a government official, they will NEVER: 

  • Threaten you
  • Demand immediate payment over the phone or via email
  • Require payment by cash, gift card, pre-paid card, or wire transfer

There are several ways to report government impostor scams, depending on who the con artist claims to be:

  • IRS - Fill out the “IRS Impersonation Scam” form on the Treasury Inspector General or Tax Impersonation’s website, tigta.gov, or call TIGTA at 1-800-366-4484.
  • Social Security - The Office of the Inspector General, Social Security Administration (SSA IG) has its own online form to take complaints about frauds impersonating the SSA.
  • Federal Trade Commission - 877-FTC-Help or ftc.gov.
  • Internet Crime Complaint Center - https://www.ic3.gov/complaint/splash.aspx.

Blog Topics: Fraud Prevention

Back to School Amid Covid-19

Back to School Amid Covid-19

 

By Kylee Hale

Wednesday, August 5, 2020

The coronavirus continues to cause chaos as we head into fall. School reopening plans are being released nationwide, and many schools in Indiana are going virtual to start the school year. This unique approach to education is not only burdening parents with concern, but it's affecting retailers' ability to meet consumer demands. While school districts delay the start and others implement e-learning plans, the retailers have been stuck with shelves of lunch boxes and uniforms while trying to stock up on electronics. The typical escalation in sales is falling flat as trends change.

Fewer parents are buying new clothes, folders and backpacks but technology purchases have been on the rise. It’s likely that technology spending will offset the reduction of spending on traditional school supplies, but it’s a challenge for retailers to decide what to keep in stock as plans change. If students return to in person learning at the beginning of next year, they will eventually need new backpacks, lunchboxeOnline Shopping increasess, and more. Imagine shopping for Christmas decorations right next to highlighters, pencils, and binders. 

Last spring, when many adults began working from home, online companies like Wayfair and West Elm saw an increase in sales of home office furnishings including desks and office chairs. A similar trend in online sales is occurring as schools release virtual learning plans. Families are creating long term remote learning environments for their children with tables, desks, and comfy chairs. Back-to-college spending isn’t as expected either. Colleges and universities are unsystematic about return to campus plans. Some schools are allowing freshmen and sophomores to be in dorms while offering some in person learning and others are implementing only distance education. Stores like Bed Bath and Beyond won’t sell near as many Twin XL bed sheet sets if students aren’t staying in dorms. These fluid and constantly changing plans are challenging stores to determine inventory and purchasing discounts. As they try to get the right inventory, it is likely stores will end up with loads of gear they are unable to sell, and they’ll struggle to keep other items in stock. 

Stores that have developed an online presence and ship to home system will be at an advantage to smooth out the imbalances. It's likely spending will continue to occur online, even with stores reopening for in person sales, consumers' preferences trend towards curbside pickup and delivery. In addition to the unpredictable change of plans, states across the country are seeing a soaring unemployment rate. Families are being stricter about their budget and reducing spending. A cherry on top of all this, Amazon has postponed Amazon Prime Day. A sale event that usually occurs in July which many retailers jump on board with for the bonanza. 

This year’s back to school season is going to require a lot of improvising from the retail industry and from families as well. In addition, it’s equally difficult for teachers to prepare a full remote education in such little lead time. Some schools are still working on their plan to begin the school year and how education will be delivered. Many parents are in a pinch hoping for remote work or other ways to ensure their child is learning while home. New developments occur daily and implementations of how to keep this generation from falling behind are constant. We can’t blame teachers for all the shortcomings of the education system. By parents taking matters into their own hands to pick up the pieces or fill the gaps, families will make it through this back to school mess. Supplementing a student’s learning with additional resources can go a long way. As we know no single education from one school can cover everything there is to know in life. Together as teachers, parents, grandparents, students and neighbors we have to help each other get through to when students can learn in classrooms again with all their friends. 

With so much uncertainty, it’s hard to tell what will happen next. It’s best to have a plan. If students are currently expecting to learn in person, have a plan for in case remote learning is implemented. In addition, if students are remote learning, plan for enough face masks and safety supplies for when students finally return to the classroom. Being ready to sanitize and contain germs as much as possible will help ease concerns when students are attending school in person. Family conversations to discuss the changes and feelings towards new experiences during this time will help students and parents monitor the situation and implement change when needed. You can visit the Indiana Department of Education’s Remote Learning Resources to find free Wi-Fi access and instructional resources for parents. The most important back to school essential this year is a good mindset. Now more than ever students are learning from their parents and caregivers. As adults, it’s most important to keep a sense of positivity and patience as we all adjust and acclimate to the unique learning environments. By adjusting expectations of students, teachers and each other, we will make the start to the school year a success. Just remember that we are all navigating these current situations as best as we can. There is no right answer because this is a new experience for all of us. Someday we will look back at these times and be proud of how communities handled the remote learning and overcame these challenges making communities stronger and better equipped for whatever comes next. 


Blog Topics: 
Budgeting

July 2020 Posts

Celebrities, Cryptocurrency, and Crime

Celebrities, Cryptocurrency, and Crime

 

By Kelly Griese

Wednesday, July 29, 2020

What do celebrities, cryptocurrency, and crime all have in common? Twitter. Earlier this month, July 15 to be exact, several famous Twitter users had their accounts hacked by scammers who sent out fake tweets asking followers to send money using Bitcoin – a type of cryptocurrency.


We’ve discussed cryptocurrency and related scams before in this blog, but for the TL;DR (too long; didn’t read) version, cryptocurrencies are digital assets created by companies or individuals that take the form of a virtual coin or token. They are largely unregulated, uninsured, and untraceable. This makes cryptocurrency incredibly popular with criminals.

You can learn more about how cryptocurrency works by watching this video from the New York Times.


Cryptocurrency scams are a popular way for scammers to trick people into sending money. While the Twitter hack targeted high profile users, including Democratic presidential candidate Joe Biden, former President Barack Obama, and Tesla CEO Elon Musk, there’s a good chance you will encounter such scams as well. They often appear as emails trying to blackmail someone, as online chain referral schemes, or as bogus investment and business opportunities.

In the case of the Twitter hack that targeted verified accounts of celebrities, scammers received 400 payments in Bitcoin, totaling $121,000. Considering the number of followers that the targeted Twitter members have, it’s a relatively small amount of money that was lost. Twitter addressed the hack quickly, shutting down all verified accounts for several hours. 

Twitter founder and CEO Jack Dorsey called it a “tough day for all of us at Twitter,” and believes it was a social engineering attack that started by targeting Twitter staff with administrative access. High level admins at Twitter have the ability to take control of verified accounts and tweet on their behalf. Dorsey said, “We’re looking into what other malicious activity they may have conducted or information they may have accessed.” 


Cryptocurrency scams have been on the rise for years now, setting a record in 2019 with scammers making more than $4.3 billion worth of cryptocurrency. That’s triple what scammers earned in 2018, and 2020 appears to show continued growth. You can read more about 2019 cryptocurrency scams by reading the 2020 State of Crypto Crime report. One of its more interesting findings is that the vast majority of criminals’ earnings came from Ponzi schemes, which accounted for 92%. 

Here’s what all cryptocurrency scams have in common:

  • A scammer wants you to send money or make a payment using Bitcoin or other type of cryptocurrency.
  • Once you send the money, it’s gone, and there’s generally no way to get it back. 

If you see a tweet, text, email, or social media message telling you to pay with Bitcoin or other form of cryptocurrency… IT IS A SCAM! If you spot a cryptocurrency scam, report it immediately to the Federal Trade Commission


Blog topics:
Fraud Prevention

Work From Home Scams and Opportunities

Work From Home Scams and Opportunities

 

By Kylee Hale

Wednesday, July 22, 2020

As coronavirus cases continue to rise again, you may be looking for options to make an income without leaving the safety of your home. There are plenty of legit work from home opportunities, but there are just as many sketchy job offerings that will cost you money rather than make you money. Below we discuss in detail fraudulent job offerings and provide tips on how to check out the real work from home job options.

Beware of job offerings that come to you as an unsolicited phone call or pop up ad on your web browser. It’s tempting and sounds doable to make money from the comfort of your home, but most job offerings that just fall into your lap are too good to be true. Fraudsters target and play on victim’s emotions. Scammers come up with convincing sales pitches knowing that many folks are worried about contracting the virus and it’s likely that everyone could use more money. From stuffing envelopes, medical billing, secret shopping, re-ship and telemarketing re-sale gigs almost all of these kinds of opportunities are set up to fail and never pay off. Check out the FTC’s Working From Home webpage to read more about each of these individually.

 

 

 

 

 

 

 

Resources for finding a work from home opportunity:

Aside from the pandemic influencing many folks to want to work from home, there are many other reasons to seek a remote job opportunity. Maybe commuting to the office is not so desirable, planning work attire is a headache, buying lunch at the cafeteria is not appealing, or you just want to spend more time around your family or dog. Regardless of your motivation to consider looking for a remote job opportunity, here are some resources that might help you land an alternative career option. Please note, I cannot guarantee that every job posting is legit and not a scam.

We Work Remotely, Jobspresso and Working Nomads job forums. These sites are strictly for remote job postings. This means less wading through the job description details to determine if the opportunity is really a work from home oppportunity. The listings include options for employment in customer service, sales, marketing and downright quirky job options too. Be sure to note the location as some remote jobs do require the employee to live in a specific country, region or time zone. Most companies also have a job page on the company website, so you can cross reference the listing on a third party site with the listing on the company’s website to make sure it’s a real opportunity.

Remote Jobs

Another resource that I have always found useful is Glassdoor. This site has a wealth of information about companies and reviews from actual past and present employees. Background checks go both ways. You should research the company you are applying to work for as this is a good way to determine if you will be happy in the position. Glassdoor reveals information that you might not find otherwise. You can see what people think of the CEO, review reported salaries for specific positions and learn about the hiring process including interview questions. Real people give their feedback and these insights could help you decide if a company is a good fit for you before you endure the application process.

You can always look for remote and work from home jobs on the more common forums like LinkedIn, Monster, ZipRecruiter and Indeed. However on these sites it can be difficult to find an opportunity that is completely remote. Be sure to read the details of the job listing and it doesn’t hurt to ask the Human Resources Hiring Manager for confirmation.

The chance of encountering a work from home scam is scary, but there are ways to sniff out a scheme before you fall victim. Unsolicited calls offering you a way to make money or strangers promising you’ll make money after an initial investment should send up red flags. It’s important to do research on available opportunities and properly vet a company before you begin employment. With the above information job seekers can find and consider real opportunities without fear of falling into a fraudsters trap.  


Blog Topics:
Fraud Prevention

The Economics of Animal Crossing

The Economics of Animal Crossing

 

By Kelly Griese

Wednesday, July 15, 2020

All it took was a pandemic to turn a 19-year-old video game franchise into one of the most popular ways to waste time at home. I’m talking about Animal Crossing: New Horizons (ACNH).

What is ACNH? You start the game by agreeing to move to a deserted island being developed by a somewhat shady raccoon named Tom Nook. Tom is big on upselling. He will always convince you to borrow more money in order to buy and build bigger and better things for your new island home. Through the course of the game, you gradually develop the island into your own paradise, all while making friends with talking animals. 


ACNH was released on March 20, 2020. The franchise began in 2001, but the latest game, exclusively available on the Nintendo Switch, has sold more than 13 million copies. It sold more in its first six weeks than any previous Animal Crossing game. Getting your hands on a copy of the game is easy, though don’t look for a drop in price anytime soon. It sells for close to $60. But getting the console you need to play the game may be challenging. As Forbes reported in April, gamers had better luck finding toilet paper than a Switch. What’s causing the shortage? Well, a few things, all related to supply and demand. The Switch is manufactured in China, and the pandemic forced factory shutdowns, meaning supply dropped. This happened at the same time as an increase in demand (though the Switch was certainly popular before the pandemic). But there’s an even bigger problem driving shortages: bots buying up stock before it can reach store shelves. Once the bots have done their job, the folks who use them can then resell the Switches on eBay or Amazon at a huge premium. Switch’s retail price is around $300, but a quick look at Amazon right now will show you consoles selling for $500.


But enough about the real world supply and demand issues, let’s talk about the in-game economics. I’ve been playing the game myself for about two weeks, and here are the financial concepts I’ve encountered so far: 

  • Loans, Financing, and Home Ownership
  • Fundraising
  • Donating
  • Supply and Demand
  • Producers and Consumers
  • Goods and Services
  • Return on Investment
  • Stock Market

There are two types of currency in the game. Bells and Miles. Think of Bells as cash. Think of Miles as rewards points. You can earn Bells by selling a number of consumable products that you can collect on your island, such as fish, insects, fruits, wood, and minerals. You earn Miles through experience. So what do you do with all this currency? Well, you buy stuff. Lots of stuff. Let me breakdown some of the above financial concepts with examples. 


Loans, Financing, and Home Ownership

When you first move to the island, you immediately owe Tom Nook 5,000 Miles for moving expenses and a tent to live in. These first 5,000 Miles are easy to earn, so you’re able to pay off your debt within your first day of playing. From that point on, each improvement of your living quarters, from a one-room house to a six-room mansion results in you taking out additional mortgages. In total, you will spend 5,696,000 Bells to reach mansion status. (For the record, my home currently has four rooms, and I still owe about 250,000 Bells on my most recent home expansion.) Loans and financing are real world things that adults understand, but these are new concepts for many of the children playing the game. What’s different about ACNH is that these are zero-interest loans and you can take as much time as you want in repaying your mortgage. No late fees! 


Donating

As I mentioned above, the primary method for earning Bells in the game is through gathering and selling consumable items you find around the island. Some of these items are incredibly common, others are rare. As you might imagine, goods that are harder to find fetch a higher price when you sell them. For example, a Coelacanth (a type of fish that’s critically endangered in reality) sells for 15,000 Bells. That’s some serious money that could be used toward paying off your debt or buying cool new stuff. But the game encourages you to donate one of every type of creature, fossil, and piece of art found on the island. These donations are then placed on display in an elaborate museum. ACNH players are quite proud of their museums. I know that I was particularly excited when I caught my first Great White Shark, and even though I could have sold it for a lot of Bells, I donated it to the museum so I could regularly visit and watch it swim. I’m still searching for the elusive Coelacanth. The concept of donating in the game is interesting. The reward players receive for donating is not monetary, but they do receive a great deal of satisfaction in working toward a complete museum collection.


Supply and Demand

While most sellable items in ACNH have a set price, there are times you can earn extra income. For example, Timmy and Tommy Nook, who buy anything you find on the island, have a “hot item” every day. This is an object that you can craft using raw materials you find on the island. My first “hot item” was a simple wooden nightstand. By harvesting wood from every tree on my island, I was able to make several dozen and sell them at a marked up price. There are other ways to maximize profits. Some of the animal characters in the game have particular appetites. For example, C.J. is a beaver who will occasionally visit your island and pay 1.5x more for fish than Timmy and Tommy will pay.


Stock Market

No discussion of Animal Crossing: New Horizons would be complete without talking about turnips. Yes, turnips. Each Sunday, an animal character named Daisy Mae will arrive on your island to sell turnips. The cost of the turnips varies from island to island. For example, mine cost 108 Bells earlier this week, while a friend of mine reported her cost as 103 Bells. Fortunately, we found another friend who had turnips for 92 Bells each. We immediately visited his island to buy as many turnips as we could carry. Why? Because throughout the rest of the week, we will have the opportunity to sell our turnips for a huge profit (or loss). You have just one week to sell turnips bought on Sunday, before they rot. On Monday, I checked the value of turnips on my own island, and I could sell them for 142 Bells each. Yes, it’s a profit, but last week I sold my turnips for 459 Bells each! As with the real world stock market, the goal is to buy low and sell high. I want the best return possible, so I start by asking my friends about the prices on their islands. If they have an exceptionally good price, I simply travel to their island to sell. But if they don’t have good prices either, that’s when I turn to the internet. ACNH players from around the world use social media, apps, and websites to communicate about turnip prices and negotiate island visits. One of the more popular apps is called ACNH Exchange. On it, players can post their current turnip prices and agree to host other players on their islands. But there’s a catch. The lines are long (I’ve seen lines up to 13 hours long), and hosts often demand high value items in exchange for allowing you to visit. This is when a player must consider the return on investment. Is the time spent in line and the fee for accessing the island worth it? I got lucky last week and was able to visit a friend’s island to sell my turnips. There was no wait, and the friend didn’t charge me any fee. This week, I have 2,000 turnips to sell, so now I’m aggressively looking for the best price with the lowest fee and shortest wait.


Economic Education

All of the above commentary might make you think Animal Crossing: New Horizons is a stressful game. Personally, I find it incredibly relaxing. It’s also been a fun new thing to do with my friends while we’re all social distancing. My ACNH character can visit their islands, and they can visit mine. It’s a safe way of hanging out together. 

What I wasn’t expecting when getting the game was the economic education built into it. The financial concepts explored in-game and the real world economics that have evolved with the game’s popularity make it all the more interesting for me, as someone who educates others about personal finance and investment fraud. If you’re looking for a fun way to introduce your children to some basic financial concepts, Animal Crossing: New Horizons might suit your needs. Just make sure you have conversations offline about differences between the game and reality. 

Meanwhile, I’m going to look for ways to integrate Animal Crossing into the activities and presentations we offer for kids. I encourage you to take a look at what we already have to offer by checking out a previous blog post


If you want a lot more in-depth information about the economics of Animal Crossing, here are some of the articles I read before writing this blog post: 


Blog Topics:
Budgeting, Credit, Investing 

A Second Stimulus Check

A Second Stimulus Check

 

By Kylee Hale

Wednesday, July 8, 2020

Man holding dollar billsThe debate continues as lawmakers try to determine if a second round of stimulus checks will be sent out. But the upside is more than likely in the month of July, the decision on if Americans will receive a second stimulus check will be made. One thing is for sure, U.S. Senator Mitch McConnell has said that the next relief package will be the last. Below are some updates on who would qualify for a second stimulus check and the possible timeline for the checks to be distributed. If you have not received your first stimulus check, you can track the status or report a missing stimulus check here. Also if you are still waiting on the first stimulus check, here is a list of some possible reasons of why you haven’t received it yet. 

Decision Making Timeline

There is no official date set for Congress to vote on the second stimulus package. Yet this timeframe gives insight as to when a decision will likely be provided. 

7/3-7/17 As of last Friday (July 3rd) the Senate has been on a planned recess and will return on July 20th. Supposedly during this break the members of the Senate will be gathering the information needed for the second stimulus package and return ready to work. 

7/20 – 8/7 The Senate will return and be hard at work in session. 

8/10-9/7 The Senate will go on August recess, from mid-August through the Labor Day holiday. 

Senator McConnell has already said that the Senate will not work through the August break. If the Senate decides to take up a second stimulus package in July, a new bill authorizing the second round of checks would need to pass both chambers on or before the recess beginning August 7th. After the August recess, the Senate will return on September 8th and continue through September 25th. If the stimulus package is not completed by Congress before the August break, then the discussion will resume in September.

Payment Distribution Timeframe

If the second round of stimulus checks are approved, the next question you may be asking is, when will the checks be sent out? If the bill passes the House and the Senate prior to the August recess, it’s possible the IRS could begin sending out checks in August. 

Thinking back to the first round of stimulus checks, on March 27th the President signed the CARES ACT into law and the first stimulus payments went out on April 15. This three week turnaround on the first stimulus payment shows that it’s possible for the second round of stimulus checks to be sent out before the end of August. If the bill is signed on or before August 7th, following the timeframe from the CARES ACT, the second round of checks could be sent out around August 26th. 

It is possible the processing for the second round of stimulus checks could be faster than first round since some of the hiccups should be already taken care of. The IRS already has the tools established for Americans for sign up for direct deposit and/or check the status of their stimulus payment. However, the guidelines of who qualifies for a second stimulus payment has changed a little and this could affect the speed of how fast or slow the checks are processed.

Who Might Qualify

Man with papers and laptopNo details have been confirmed yet. The HEROS ACT was passed in May by the House of Representatives and proposes more coverage for families and individuals like college students which were not covered in the first round of stimulus payments. However some officials say this second round of payments will be more narrowly awarded to those most in need. There is potential that individuals who reported a gross income less than $99,000 on their 2018/2019 taxes would qualify for the second stimulus payment. In addition, there is speculation that college students, dependents over 17, and disabled relatives would qualify as well. There has also been talk that no one will qualify. It’s possible the second stimulus package could be geared to give tax credits and incentives to businesses with some people awarded travel or dining credit but not a check.

How Much Money?

There is a lot of discussion still to be had before the amount of money that might be on a second stimulus check is clear. As mentioned above there is a chance, no check is sent, but travel and dining vouchers distributed instead. The Heroes Act proposes another $1,200 check for qualifying individuals. While some representatives propose a larger check amount and some suggest a tax credit. The amount remains very uncertain and regardless individuals still have to meet qualifying guidelines before being in the clear to receive a second stimulus payment.

 

With the variance in the information and insight being given regarding the second round of stimulus checks it's best not to take anything to heart.  While uncertainty remains as to how our communities will recover and the best ways to onboard a new stable normal, it’s important to focus on yourself and what makes you secure. Check out this recent post on reducing financial anxiety, and the original COVID-19 Financial Survival Guide for tips on managing and saving money during these difficult times.

Vacation... Had to Get Away!

Vacation... Had to Get Away!

 

By Kelly Griese

Wednesday, July 1, 2020

With the holiday weekend upon us, you’re probably looking to create some distance between yourself and the sofa. We get it. Summer has us all itching to get outside and explore, but there are challenges this year that we have not faced in the past. 

It can be especially hard on kids. Summer camps are canceled. Sports are canceled. Even running around with other kids in the neighborhood can be risky. But there are still plenty of ways to have fun as a family. In fact, if you’re a parent working remotely, this may be the perfect year for a long family road trip. 

In this blog post, I’m going to focus on outdoor fun that’s perfect for social distancing. In planning your own trip, remember that Google is your friend! Use search words like vacation, pandemic, and budget along with any terms that best describe your ideal vacation. 


National Parks

Our national parks are remarkable. Americans (and visitors from abroad) love exploring this nation’s natural beauty. In 2019 alone, more than 327 million people visited national parks. There are 419 parks to explore! You’ll want to check with the National Parks Service before embarking on your journey. While the majority of our nation’s most famous parks are open right now, some sections of those parks are closed. You can research parks and check for any closures/restrictions by visiting this website

We Recommend: 

  • Indiana Dunes – it’s great for beach lovers and bird watchers! Plus, if your kids like Pokémon Go, have them give geocaching a try. 
  • Lincoln Boyhood National Memorial – it’s great for history lovers and hikers! Parks like Lincoln Boyhood help bring the past to life, which is great for getting children excited about learning. 

State Parks

Visits to state parks can be equally fun and frugal. All Indiana Department of Natural Resources properties are open right now, including state parks, but there are a few services and facilities that are temporarily closed due to the pandemic. DNR regularly updates its website with information about such restrictions, and you can view the full list here

We Recommend: 

  • Clifty Falls – it’s great for waterfall lovers and fossil enthusiasts. We love this state gem so much here at the Indiana Secretary of State’s office, that we named one of our conference rooms after it! And if you’re looking for more waterfalls to chase, Indiana has plenty of options. Visit Indiana put together this inspiring list. 
  • Angel Mounds – it’s great for bicyclists and history buffs. Located in Evansville, this site is nationally recognized as one of the best-preserved prehistoric Native American sites in the United States. You may also be interested in Mounds State Park near Anderson, which features 10 unique earthworks built by the Adena-Hopewell people. The largest mound is believed to have been constructed around 160 B.C. 

Quick Tips: 

  • Many water fountains have been turned off due to the pandemic. Don’t forget to bring plenty of water! And if you’re traveling with pets, you’ll want a portable dish for their water. 
  • You may need special permits or licenses to enjoy some activities, such as hunting, fishing, and boating. Check with the department of natural resources in the state you’re visiting to see what’s required. 
  • Make campground reservations in advance! Nothing worse than showing up and not having a place to stay. 

RV Rentals

Maybe you don’t want to add mileage to your own vehicle, or perhaps you simply want some room to spread out for the long drive. RV rentals are all the rage right now. Just make sure you do your research. There’s a lot to consider before renting an RV. What kind of vacation are you planning? Where are you traveling? Are you comfortable driving such a large vehicle? Do you know where you can park it? Have you created a fuel budget? I am by no means an RV expert, but the folks at KOA are! They have 10 tips for renting an RV that you’ll want to read as part of your trip planning. 


Cabin Rentals

Recently, I’ve noticed a lot of social media posts that feature my friends having fun with their families at rental cabins here in Indiana and some of our neighboring states. Cabins can be a great way to get away during a pandemic. There’s typically more space between you and any other folks on vacation, and it’s still a change of scenery from your primary quarantine residence. But before you jump on VRBO or Airbnb, you once again need to consider your vacation carefully. Frommer’s provides some essential words of wisdom

  • Know what you want. You need to identify your priorities, such as location and amenities. If the cabin absolutely must be waterside, then know you might spend more on that priority. 
  • Timing is everything. Research what’s going on in the surrounding community. Right now, this is one way you can likely save, because many events are canceled. You probably don’t need to worry about a large festival or sporting event inflating the cost of rental properties. 
  • Authenticate the property. It is vital you verify that the pictures and description you’ve found online match a real property that’s available for rent. There are far too many horror stories about scams involving vacation rentals for you to forgo this step.  

Fishing Trips

Fishing is a great way to spend time together as a family. Whether you practice catch-and-release, or you’re looking to reel in a campfire meal, this is an activity just about everyone can learn and enjoy. The U.S. Fish and Wildlife Service wrote a great beginner’s guide for aspiring anglers that I highly recommend. One of the key takeaways is getting a fishing license! Once you know the basics and have a license, you can plan your fishing adventure. Gear and location are two major components of any fishing trip. Do you need to buy gear, or is rental equipment available? Are there fees for using the location? Are you allowed to keep what you catch?

We Recommend: 

  • Indy Fishing Locations – The IndyStar put together a good list of local fishing holes for you to explore. 

Quick Tips: 

  • It’s important to be a good steward of the environment when fishing. Abandoned gear is harmful to wildlife, and overfishing ruins the fun for future generations. 
  • Bring a first aid kit with you. Fishing injuries are fairly common. Here are some tips for tending to injuries that might occur. 
  • Wear lifejackets or personal floatation devices (PFDs) when fishing from a boat. 

Roadside Attractions

Finally, let’s talk about a staple of family vacations: the roadside attraction. This term may make you think of weird wastes of money, but that’s not always the case. Kids love these quick stops, and many are accessible without paying a cent. Plus, they make for some fun family photos. Visit Indiana compiled an awesome list of roadside attractions you can find in the Hoosier state, and most of them are outside! 

Quick Tips: 

  • Bring hand sanitizer and sanitizing wipes if you plan on getting up-close-and-personal with any of these landmarks. 
  • Check if there is an Instagram hashtag for the location. Such spots are hot with social media influencers. 

Blog Topics:
Budgeting, Fraud Prevention

June 2020 Posts

Strong Finances for a Strong Emotional Wellbeing

Strong Finances for a Strong Emotional Wellbeing

 

By Kylee Hale

Wednesday, June 24, 2020

There are multiple things contributing to the anxiety Americans are feeling right now. With many people working from home while caring for children, and juggling health concerns, it’s no surprise that people are feeling stretched to the limit. According to a recent survey by the National Foundation of Financial Education, nearly 9 in 10 Americans say that money is a primary cause of anxiety. 

As cities begin to reopen and attempt a slow return to normalcy, the tens of millions of Americans who lost their jobs or were laid off will continue to worry about their livelihood and feel the emotional toll. According to a poll by the Kaiser Family Foundation, 45% of U.S. adults report that their mental health has been negatively impacted due to worry and stress over the virus. Another survey, showed that 69% of American adults have financial worries, which are heighten by three major concerns: not having enough savings, losing a job, and not being able to pay debts. Even in better times, financial concerns can cause a lot of stress. Regardless of the circumstances, here are some ways to ease your mind if you’re dealing with the common money stressors. 

You are in control

Every one of us is experiencing change to some degree, which means we have to think differently to get through this. What you were doing before may not work now, but embracing the things you can control will provide stability during these unsteady times. Some things that you can control are spending, saving, and your reaction to market events. 

If you are struggling and your emergency fund is dwindling, you should examine your expenses. Rethink your budget and prioritize the bills that cannot be put off. For Hoosiers, the Governor’s order prohibits evictions, foreclosures, and utility service disconnects through June 30th. You can read more about this in our Deadlines and Delays post. Many states have issued executive orders to block evictions and many state courts are not accepting eviction filings until further notice. 30% of Americans have not paid their housing payment this month. While this is not something to promote, there are safeguards in place to keep Americans from losing their shelter. 

Creating an emergency budget can be helpful to review spending and saving. Track online spending and avoid triggers to cut out unnecessary purchases. Unsubscribe from emails, unfollow brands and influencers on social media, and delete browser history to help control spending.  It’s still important to save whenever you can, but you may have to redirect some of your saving goals to more pressing financial needs. 

For investors, while you can’t control the market, you can control your reaction to the fluctuation. If you’re wondering how to survive this unpredictable market, try to remind yourself to relax and ride it out. Attempting to time the market isn’t a good strategy and can result in costly mistakes. For help on convincing yourself to be content check out this post on market correction

Rid Yourself of Anxiety

Understanding how anxiety relates to your financial decisions can provide you the peace of mind you need. Stress and worry have adverse effects on our spending habits, often contributing to more spending and less saving. Similar to stress eating, stress spending is something we do to try to make ourselves feel better. On the other hand, saving is really what makes us feel better and more prepared for the unexpected.  Try putting extra thought into purchases and determine if they are unnecessary. Saving more money at this time can put you more at ease in the case of a future unplanned event.

If paying bills is a hassle to you, a way to reduce the stress of remembering to pay on time is by setting up auto pay or bill pay. Auto pay can be scheduled through the service provider and bill pay can be set up through your bank. With bill pay, the bank automatically issues regular monthly payments and you can do this for mortgages, student loans, rent, utilities, car loans, and even credit cards. Give your mind a break and some clarity by not worrying about missing a payment. In addition, to automatically paying your bills, you can arrange to automatically save. Establishing regular payments into your savings account or retirement account is a good way to ensure you do save and this will help you reach your savings goal. 

Being proactive rather than reactive instills a sense of preparedness and minimizes the pressure felt when an emergency does occur. It is difficult to prepare for an emergency as it is unexpected. The best way to stay calm is to be flexible. Come up with a plan or an adaptable process that allows you to maintain your livelihood when the world around you changes. Four proven and effective financial strategies that will help you get through whatever comes at you are to spend wisely, save for emergencies, stick to your goals and invest for the long term. These strategies are successful all around and sure to reduce tension in difficult times. 

Studies have shown that actively managing your finances can have positive side effects. By putting in the effort to save money, you’ll create an emotional buffer that’s sure to reduce anxiety. Being aware of your financial plan will provide confidence and less tension when the unexpected does occur. Even taking small steps or implementing just one or two strategies for better money management will give you a better mental outlook. 

Take Advantage of Available Resources

If you continue to feel worried, reach out to a partner or a friend. Discussing financial fears together can help you find a better solution. If you prefer to talk to a professional, there are multiple free resources available. For example, the National Foundation for Credit Counseling offers a COVID-19 Emergency Financial Help toolkit with access to chat counselors for advice. The National Association of Personal Financial Advisors and the Financial Planning Association also provide certified financial planners and advisors at no cost. 

Virtual health visits are also gaining popularity. Most insurance providers cover a variety of mental health resources and many therapists are available for telehealth appointments. For more information on mental health services contact your insurance provider or employer as some employers have free counseling through employee assistance programs. Lastly if you feel you are suffering from mental health issues, the Substance Abuse and Mental Health Services hotline does not require insurance and is available 24/7.

While it may not be as obvious as stress eating, financial stress can be detrimental to your health, mentally and physically. Just as we try to stay physically fit, it’s important to remain financially stable in difficult times. Being in control of your financial decisions and being prepared can do wonders for your overall health, mentally, emotionally and financially. You don’t have to go into overdrive to be financially prepared but any effort made to better weather the storm will make you feel better all-around when crisis does occur. 


Blog topics: 
Budgeting, Credit, Investing 

IN-CASE: Protecting Senior Citizens

IN-CASE: Protecting Senior Citizens

 

By Kelly Griese

Wednesday, June 17, 2020

We’re celebrating the first anniversary of the Indiana Council Against Senior Exploitation this week. Indiana MoneyWise, which is part of the Indiana Secretary of State’s office, is a founding member of IN-CASE, and I serve as the council’s chairwoman. 

We created IN-CASE out of a desire to protect senior citizens against abuse and exploitation. This week, June 15-21, is also the second annual Indiana Elder Abuse Awareness Week, filled with virtual events aimed at educating and empowering seniors. 

Social distancing is still necessary right now in order to protect the people we love, but that distance takes its toll. One of the sad ironies of the current pandemic is that keeping at-risk persons safe at home can exacerbate the negative physical and mental health effects of social isolation, including financial exploitation. That’s why all of our IN-CASE events this week are virtual. You can join panel discussions and view demonstrations on your internet connected device. These events serve as a call-to-action for individuals, organizations, and communities to raise awareness about elder abuse, neglect, and exploitation. 


EVENTS

Indiana Elder Abuse Awareness Week is already halfway over, but if you missed out on Monday and Tuesday’s events, don’t worry! You can watch Monday’s panel discussion titled “How to Avoid Getting Scammed” on the Facebook page of our partners at Better Business Bureau Serving Central Indiana. Tuesday’s tele-town hall with AARP Indiana is also available online, just visit AARP’s Facebook page. Today, we have a conversation between one of our members, Diane Dove, and her mother, Daisy Dove, as they address some of the concerns many seniors have regarding ordering groceries online. We even provide you with some “Cooking for One” recipes in the IN-CASE blog! On Thursday, we’ll have a fitness demonstration with a personal trainer who will show you some exercises that are perfect for senior citizens and don’t require any specialized equipment. And we’ve saved the best (or at least most popular) event for last: BINGO! There’s still time to register to participate in this online game of BINGO. It is free to play and uses the Zoom web conferencing program. Here are the links you need for all of the fun events I just mentioned: 


ABOUT IN-CASE

The foundation for IN-CASE was laid over 4 years ago with the Indiana Association of Area Agencies on Aging's (IAAAA) Senior Medicare Patrol director began hosting a networking group consisting of government agencies and organizations that serve older adults and/or have a mission to educate them and their caregivers on how to prevent all types of fraud. This networking group eventually led to the organization as it exists today. The mission of IN-CASE is to empower Indiana communities to prevent and end senior exploitation and abuse through education, encouragement, and empowerment. 

IN-CASE is comprised of government agencies, law enforcement agencies, consumer protection groups, attorneys, healthcare providers, educators, and more. You can find a complete list of our resource providers by clicking here. You can even schedule many of our members to serve as FREE public speakers, and their contact information can be found by clicking here

You can also connect with IN-CASE on social media.


PREVENTION

Prevention is key when it comes to elder abuse. There are steps seniors can take to reduce the chance of becoming a victim. It’s important you know your rights and stand up for yourself. Also, stay involved in your financial affairs – don’t rely on others to review your bank statements. Be confident that you can make decisions yourself. Here are some prevention tips from the National Center on Elder Abuse

  • Stay busy and engaged in life. Try not to become isolated. Cultivate a strong support network of family and friends.
  • Take good care of yourself – for life. Older adults in declining health can become more vulnerable to abuse because of the increasing dependence.
  • Be aware of the link to addiction problems. People who drink too much or who use other drugs are at a high risk of being abusive. Reach out to support groups.
  • Refuse to allow anyone, even a close relative, to add his or her name to your bank account without your clear consent. Never make financial decisions under pressure. Avoid signing over money or property to anyone without first getting legal advice.
  • Assert your right to be treated with dignity and respect. Be clear about what you will and will not tolerate, and set boundaries. You have the right to make your own decisions.
  • Trust your instincts. Listen to the voice inside you when it calls out something is not right. Ask for help if you need it.
  • It is also a great idea to plan. Talk with family members, friends, and professionals whom you trust and plan for your future. You can find helpful information about planning for your future on the Legal Services for the Elderly's Elder Rights Handbook website.

Remember, if you are concerned for someone’s immediate safety, call 911. 


Blog topics: 
Fraud Prevention 

How Coronavirus has Affected Wedding Season and Tips for Investing with Your Partner

How Coronavirus has Affected Wedding Season and Tips for Investing with Your Partner

 

By Kylee Hale

Wednesday, June 10, 2020

Every year there are over 2 million weddings in the United States, and this 78 billion dollar industry has been brought to a halt by COVID-19. As wedding plans are drastically changed, couples and vendors look for a plan B. For some, a change of plans means reducing the guest list while others are rescheduling for next year. Venues and vendors are adapting to offer packages for smaller parties. These include mini ceremonies and micro luxury weddings with over the top service for a smaller guest count. However, with the economic decline and stressful financial situations that many are dealing with, some couples are sticking to a reduced budget and cutting back altogether.

 

 

 

 

 

 

It is likely that smaller ceremonies will be trending through this fall and wedding insurance will be a higher consideration for newly engaged couples. Unfortunately it is too late for couples to purchase insurance coverage for the impact of COVID-19, but couples can purchase insurance for future unexpected events. In the wedding and event industry there are two main types of insurance available. Liability insurance may be required by the venue and typically covers any damage done by the bride, groom or their guests and can protect the married couple if guests leaves the event intoxicated. The other type is Cancellation insurance which covers lost deposits in the case of severe weather, accident, illness, injury or business bankruptcy. 

When engaged or soon to be married, it’s easy for couples to put their focus on the big day. While a wedding and reception may be exciting, this is not the most important aspect of being joined by marriage. Before agreeing to tie the knot, couples should have a frank conversation about money and investing.

Disagreement over money is a common source of tension for couples and an oft cited reason for divorce. But these discussions are impossible to avoid as you build a life together and plan and save for retirement.

When it comes to investing, couples might have different ideas about financial goals, the types of products to invest in and the level of risk they are willing to take with the family's portfolio. Fortunately, there are things couples can do to bridge the investment style gap and keep the peace. Here are four tips from FINRA, to help you keep the harmony in your relationship.

Communicate. Like many other issues in relationships, the key to maintaining harmony is to begin with a conversation. It's important for each partner to understand the other person's tolerance for risk. It's equally important for couples to talk about their financial goals and how soon they hope to achieve them.

It's a good idea to touch base regularly about household finances and working together to create solutions—like a budget or investing plan.

Get educated. Knowledge can give couples the power to resolve financial differences. If you work to learn the basics of investing together, you can feel comfortable knowing you are speaking the same language and both understand the risks involved with different investments and different strategies.

Get started with the FINRA Foundation's free Course to Smart Investing, which is designed to fit into your busy lifestyle. And, bonus, the theme of the course sequence is love and relationships!

Divide and conquer. For some couples, it might be better to divvy up accounts and responsibilities. You might have the more conservative partner handle the savings for short-term goals, such as saving for a down payment on a house, where a conservative approach is often justified.

The more aggressive partner, in turn, could possibly oversee savings for long-term goals like retirement, where investments can be more aggressive when retirement is still many years down the road.

Hire a referee. Sometimes couples simply can't figure things out on their own. A financial professional can help couples get beyond two opposing investment styles and make recommendations based on what's mutually beneficial for the couple.

It might just be worth the cost and effort. After all, managing a relationship is hard enough without having to fight about money.

For more information on discussing your finances as a couple, check out our Money Skills for Newlywed Couples guide. 


Blog topics: 
Investing

Keeping Senior Loved Ones Safe While Separated

Keeping Senior Loved Ones Safe While Separated

 

By Kelly Griese

Wednesday, June 3, 2020

Americans understandably have a lot of anxiety right now. And, as always, we worry about our most vulnerable citizens. 

In a few weeks, our office joins countless others in recognizing World Elder Abuse Awareness Day (WEAAD) on June 15. It also marks the start of the second annual Indiana Elder Abuse Awareness Week and the first anniversary of the creation of the Indiana Council Against Senior Exploitation, or IN-CASE, where I serve as chairwoman. 

The widespread prevalence of senior exploitation and abuse destroys the security of millions of older Americans annually. At IN-CASE, it is our mission to empower Indiana communities to prevent and end senior exploitation and abuse. We believe we can achieve this through education, encouragement, and empowerment. 


IN-CASE is comprised of dozens of organizations and individuals across the state of Indiana, and we’re working together right now to finalize a series of virtual events during Indiana Elder Abuse Awareness Week. We had hoped to meet with all of you in person to celebrate our anniversary, but social distancing remains necessary right now, so we’re doing our best to support seniors and their caregivers from afar. In the meantime, we want to provide you with some quick facts about elder abuse. 

  • Elder Abuse can happen to anyone, affecting both men and women, all cultures, races, and socio-economic groups.
  • Elder abuse can happen anywhere; in a person’s own home, in hospitals and nursing homes, in assisted living facilities, and other institutional settings.
  • Women and “older” elders (80 years old and older) are the most common victims of elder abuse. Learn more.
  • Elder abuse is most often perpetrated by the victim’s own family members. 90% of abusers are family members; most often adult children, spouses/partners, and others. Learn more
  • Elder abuse is largely unreported. The National Center on Elder Abuse suggests that only 1 in 14 cases of abuse is actually reported to the authorities. Learn more

Clearly, elder abuse is a big problem, but there are ways you can help. 

Start by getting to know IN-CASE. I encourage you to explore www.IN-CASE.org and follow our social media accounts on Facebook, Twitter, and LinkedIn. In the next week, we’ll post event announcements and RSVP information for Indiana Elder Abuse Awareness Week. Some of the events we're finalizing include a tele-town hall with AARP, scam prevention BINGO via Zoom, and fitness and cooking demonstrations tailored to senior citizens. 

You can also help by simply paying attention to the seniors in your life. Here are some of the red flags of elder abuse.

  • Sudden changes in appearance: poor hygiene, dressed improperly for the weather, sunken eyes, bedsores, loss of weight.
  • Sudden changes in personality; increased or unreasonable levels of anxiety, fearfulness and/or depression.
  • The elder becomes uncommunicative and unresponsive.
  • Sudden or swift decline in the health; malnourishment or sudden loss of weight.
  • Visible injury that has not been cared for, or cannot be explained with a realistic explanation.
  • A change in routine, no longer attending events or participating in events enjoyed in the past.
  • Social isolation/ not allowed to visit alone. 
  • Sudden loss of ability to meet financial obligations.
  • Going without things the elder needs or has always had in the past.
  • The elder states that they have had conflicts or problems with their caregiver and/or they use coded disclosures.

Many of these red flags can be harder to observe right now, but social distancing is not the same as social isolation. There are plenty of ways to stay connected even while physically apart. Take full advangage of digital tools like FaceTime, Skype, Zoom, and more. These video conferencing options allow you to see your loved ones and their homes. 

If you’re wondering how to get everyone online for a video chat, here are some helpful tips: 

  • Work with what they already know. Is your loved one already on Facebook Messenger? Do they use an iPhone? These are programs that already have video chat features. You’re looking for the most user-friendly program that works with the device your loved one already has.
  • Give the seniors clear instructions on how to connect to the program you pick. You may need to describe what app icons look like, how to download software, or steps for creating a new account. 
  • Be patient and encouraging.

For more information about video chatting with seniors, I found this blog post from Crossroads Hospice to be helpful. 


Blog topics: 
Fraud Prevention 

May 2020 Posts

5 Summer Camp Alternatives for All Budgets

5 Summer Camp Alternatives for All Budgets

 

By Kylee Hale

Wednesday, May 27, 2020

As communities do their best to progress through this pandemic, parents and children are finding out summer camps are canceled along with family activities like parades, festivals, and sporting events. If parents previously relied on summer camp as a form of child care they are now faced with a dilemma. It’s still up in the air as to which camps will open when camps can open, and how many kids will be allowed to attend if the camps decide to open. Aside from coming up with a Plan B, many families are looking for activities even after work hours. Here are 5 budget-friendly alternative ideas for summer fun. 

Day Camp – Online 

Some summer camps around the state of Indiana, like YMCA camps, seem to plan on opening and welcoming children while adhering to additional safety precautions. While camps that do open will enforce smaller group sizes and possibly not allow as many kids to attend, some parents will not be comfortable sending their child to an in-person camp. There are many summer camps nationwide that will not be hosting kids in person this summer but are now offering virtual camps. For a local Indiana example, Butler University offers virtual weeklong online structured STEM camps for kids to learn coding, robotics, film, and game design. Another more affordable example is Outschool, a virtual school with more than 15,000 live lessons for all students. Outschool classes are taught by independent teachers across the country in small groups and integrate fun learning to keep kids engaged. Courses can be taken weekly, for example; Space Camp is 50 minutes a session 5x a week and costs $50/student. Some lessons are as low as $5 a class, and there are many options including Baton Twirling, Stand-Up Comedy, and Forensic Science.

A Fairy Tale Greeting

Fairy Tale Sing A Long Facebook Event For younger children that may not have the attention span for virtual lessons, here is an idea that is sure to uplift quarantine woes. What started as two ladies from California, dressing whimsically as princesses and fairytale characters, to bring love and hope to local children, has boomed into magical Zoom meetings. Loni Ward, mother of a 3 year old, has scheduled multiple calls for her daughter and says "Each chat brings a little normal back to her life and lifts her mood when she is bored with the monotonous days. It's different from watching a show or movie or playing a game [because] the characters are able to make real connections.". This type of quick check-in can save the day and provide some inspiration to little ones and enlighten the mood for an entire family. You can schedule a meeting with a Princess or fairytale character by emailing hopeloveandmagic@gmail.com. As of May 2020, virtual meetings run $35 for fifteen minutes, $60 for thirty minutes, and $10 to register for one of the sixty-minute virtual group events. A private Zoom call can include conversation, singing, and storytime. The virtual group events include Wednesday Magic Hour, Sing-Along, and Story Time for viewers to register and tune in with a special character. 

Create Camp on Demand

Some of the virtual camps with scheduled daily activities can be pricey. There is a budget-friendly alternative, but this will require a savvy planner. There are lots of resources allowing parents to string together activities to make an at-home camp planner. But this doesn’t mean you hKids doing artwork at kitchen table ave to stay at home the whole time. Scheduling an hour for a nature walk, bike ride, learning to fish, and other outdoor activities into the agenda are a good change of pace. The Children’s Museum of Indianapolis has created tons of free content bringing the museum to you at home. Dinosaur Drawing, Digging for Fossils Cookie Dissection, Glitter Germs, Story Time with Andrew Luck, there is no shortage of entertainment. The National Children’s Museum is also launching one-day camps this summer. Tuesdays will cover science and on Thursdays, virtual campers will create child-size structures. Newfields, formally known as Indiana Museum of Art, added a Newfields at Home section to their website This includes Horticulture and how-to videos for making your own bath soak, making playdough, and drawing a cartoon. They’ve even created a staff’s favorite list of children’s movies and where you can find them on streaming services. For adults, Newfields has added a how-to pour a Belgian beer video with Lindsay Jo Whirley, Newfields resident Certified Cicerone® and Culinary Arts Operations Manager and adult movie marathon suggestions. This isn’t an all-inclusive list, just check out the Newfields website for more ideas.

If you’re trying to cut down on screen time, check out some options for activity boxes. One example is Art camp in a Box. They will send you all the supplies needed for your child to create art projects at home. From the website, I’ve found that the price is $175 per box, and it includes enough supplies for 10 projects. Another option, KiwiCo, offers crate projects including Exploring Stars, Creating a Glow Lab, Unicorn Sewing, Geometric Laser project, and many more. The crates range in price from $15 - $45, but there are Groupon codes for specific boxes that are discount eligible.

For parents and caregivers who are a little more flexible with time, these ad-hoc options provide intermittent entertainment and are adaptable when structured activities are desired versus a care-free day by the pool. 

Travel a little

Currently, almost all travel is banned or discouraged. When travel bans are lifted, vacation rentals will likely be a more popular choice for late summer and fall vacations. Many people are not trusting of aircraft sanitation but more comfortable with road tripTravel a Little s in their vehicles. Most vacation rental locations are free of face-to-face interaction including online payment to keyless entry. Customer questions can be handled over Facetime, text, or phone and guests can avoid or limit interaction with the owner or other guests throughout their stay. Cleanliness will remain a concern, although those who need to travel for work rather than just leisure may still prefer a vacation rental and will likely pack their sanitation supplies.  Regardless most accommodations have stepped up their cleaning process for everyone’s safety. 

Even with the pandemic, travel is still exciting, and getting away from everyday life can be quite refreshing. Vacation rentals with a private pool can be relaxing with less worry of germs from other sunbathers. Most campgrounds are open this summer as well, which provides an opportunity to explore while maintaining social distancing. Check out the rental property policy and guidelines before booking in case there is another wave of the coronavirus in the location you are visiting or in case you get sick.

Neighbor Camp

As parents and kids are finding out Neighborhood Camptheir normal plans of attending the same camp they have returned to every summer isn’t going to happen this year, experts are suggesting that families utilize the community resources around them. While traditional summer camps are taught by teenagers, a new form of instruction could come from neighbors volunteering to share their knowledge and love of a hobby or subject with socially distanced neighborhood kids. Most communities have a mixture of individuals with a wide range of professional experiences. If your next-door neighbor is an architect this could be a great opportunity to teach kids about building, or maybe there is a guitarist across the street that could just play some music to dance to and enjoy. One of the biggest values of summer camp is role models and kids creating new relationships. New friends and learning can be fostered at home, in your community. When children play and have constructive conversations they are developing. Kids don’t have to go to summer camp for this to happen. Here some other fun neighborhood ideas, like a neighborhood scavenger hunt and front yard bingo

Summer is an exciting and favorite time of year for many. This summer will be different than any other we’ve seen before, but that’s not to say it’s ruined. If kids don’t go to camp, parents will get creative. We will think of new ways to have fun and be entertained. As long as the summer’s agenda challenges kids to socialize in new ways they will grow and continue to develop even at home and in our local communities.


Blog topics: 
Budgeting 

Credit Reports: What You Need to Know

Credit Reports: What You Need to Know

 

By Kelly Griese

Wednesday, May 20, 2020

It’s one of my top fraud prevention tips: check your credit reports! I include it in every presentation I give. Checking your credit report regularly not only helps you monitor for identity theft and reporting errors, but it can be a sobering reminder of how you’re managing your finances. Some people confuse the terms credit score and credit report, so let’s start by understanding the difference. 


You can think of your credit SCORE as a measure of your financial trustworthiness, because that’s how it’s used. Banks, landlords, insurance companies, and an increasing number of employers all use credit scores to decide if you can be trusted with money. (For more information about credit scores, we have a PDF you can print linked here.)

A credit REPORT is a detailed listing of your debt, both past and present. It shows all the credit cards and loans in your name. It also shows how much you owe to each creditor and how good you are at paying back what you owe. 


Credit reports have a LOT of information on them, and if you’ve never read one before, you may feel intimidated.  Fortunately, they’re not as scary as you might think.  There are several good websites that breakdown credit reports line-by-line to teach you how to read one. I like the sample credit report on CreditCards.com

Federal law entitles you to one free credit report per year from each of the three major credit reporting agencies: Equifax, Experian, and TransUnion. Requesting your credit report is easy and free. You can do so online, by phone, or by mail. 

Website:  www.AnnualCreditReport.com
Phone: 1-877-322-8228
Address: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA  30348-5281

And now… you can request it WEEKLY! This is a huge change prompted by the COVID-19 pandemic. Equifax, Experian, and TransUnion now offer Americans weekly access to monitor their credit report – for free. You use the same website listed above, www.AnnualCreditReport.com. The credit reporting agencies are making these weekly reports free for the next year. (For a printable worksheet about checking your credit report, click here.)


If you’re one of the many Americans struggling to pay your bills right now because of the Coronavirus crisis, the Federal Trade Commission offers this advice: 

  • Contact the companies you owe money to. Ask if they can postpone your payment, put you on a payment plan, or give you a temporary forbearance.
  • Check your credit report regularly to make sure it’s correct — especially any new payment arrangements or temporary forbearance. The recently passed CARES Act generally requires your creditors to report these accounts as current.
  • Fix any errors or mistakes that you spot on your credit report. Notify the credit reporting agencies directly. You can find out more by reading Disputing Errors on Credit Reports.

Blog topics: 
Budgeting, Fraud Prevention 

The Legacy of the Pandemic: 5 Lasting Financial Habits

The Legacy of the Pandemic: 5 Lasting Financial Habits

 

By Kylee Hale

Wednesday, May 13, 2020

There are very few aspects of our lives that remain untouched by the pandemic. Times are strange, where FOMO (Fear of Missing Out) has been replaced with FOGO (Fear of Going Out) and when wearing a mask to the grocery may seem less strange than wearing a speedo at the beach. Along with the global shutdown, most of us have found a new way of living, some differences welcomed and some we hope will soon be a memory. As we emerge from a quarantine state of mind many of us will continue to embrace our new era of frugality and continue with newly developed habits. From how we do our grocery shopping, to affordable entertainment here are five financial habits we should continue to carry out even after the lockdowns are lifted. 

1. Curbside Pick-up and Ordering Online 

Before the stay at home orders, 13% of U.S. consumers used online ordering and curbside pick-up or delivery to get their weekly grocery list. This percentage jumped up 19% since the survey was completed in the fall of 2019, this spike is attributed to the current circumstances. A lot of grocery stores are offering curbside pickup/delivery and consumers seem to be enjoying the convenience. When consumers were asked about continuing the use of online grocery services after the coronavirus, 43% said they were extremely or very likely to continue use. I think as a consumer the biggest concern with using online grocery services is trusting someone else to select your fresh produce. However, aside from being a time-saver, online grocery shopping can be a money saver. Consumers tend to cut back on impulse buys and stick to the grocery list, and their budget. Not only does online shopping allow you to check your pantry as you shop so you’re not buying cereal just in case you’re out at home, but the online cart keeps a running total. And all the prices in the cart are accurate, no more getting to the register to find out your pop-tarts aren’t on sale after all. Continuing to save money at the grocery store can free up funds for other expenses. 

2. Saving for a Rainy Day

At least 30% of Americans have tapped into their emergency funds during this pandemic, but 1 in 5 Americans didn’t have an emergency fund, to begin with. Emergency funds are supposed to carry us through when we experience a job loss or unexpected change like COVID-19 just showing up. If you have the savings, don’t be afraid to use this set-aside money to help you get through this time. Dipping into savings is a far better choice than taking on debt through a credit card or a similar source. The government implemented lockdowns will help you reduce spending on entertainment and reducing your necessary spending can help conserve your available funds. For necessities like over-the-counter medicine and feminine products, the CARES Act has implemented a change allowing these essentials to be purchased using funds from an HSA (Health Savings Account).  If you are still able to save during this pandemic, you’ll want to continue doing so. For some folks, it may be worthwhile to pick up extra hours, if still working, or look for companies that are hiring during this time. Regardless of your current situation, you should prepare to safeguard your finances as the financial implications connected to COVID-19 will continue for months to come.

3. Eating at Home

It’s expected that 75% of independent restaurants nationwide won’t survive the pandemic shutdown.  Some food industry business owners are afraid the CARES Act Paycheck Protection Plan won’t reach them, or the owners will experience difficulty applying due to language barriers and lack of ability to navigate the application. Some restaurants are holding on by relying on take-out orders and preselling holiday meals or gift cards. Consumers can safely order take-out and food delivery during the pandemic, and soon, while following social distancing guidelines, some folks will be able to go inside and sit down. On average, restaurants charge about a 300 percent markup on the items they serve, but that doesn’t keep us from occasionally splurging to combat the onset of cabin fever. There are many ways to support your favorite restaurant and still save while ordering take out. Most restaurants have reduced their menu for optimized take-out, but still, continue to offer daily specials. You can find deals and gift cards on to-go and carry-out orders on Groupon. Getting take-out may cost more than cooking at home, but you can still save money by getting your drink at home and you’ll save on the dining tax by not eating inside at the restaurant. Also, it seems that tipping on take-out orders is optional, 51% of Twitter users responded “No” to tipping for take-out. If you have a simple order and aren’t asking for over and beyond effort, you may not feel inclined to tip or tip a lesser amount like 10% compared to dine-in, 18-20% is the standard. Although take-out is more expensive, there are times when the convenience is worth it and if you plan for your weekly pizza night you won’t lose out on grocery food going uneaten. 

4. Retail Shopping

E-commerce spending is up 30% as of mid-April and due to mandatory store closures, retail is suffering a record decline in sales. At first, people were stockpiling household and grocery items and home office supplies. More recently sales have drifted towards books, entertainment games and outdoor sporting equipment, including fitness supplies. It seems like the coronavirus has accelerated a structural change that’s been occurring in retail over the last decade. Just like social distancing has created new office atmospheres and remote work, online shopping habits formed during this period may persist far beyond the crisis. The average retail store can last about 30 days without money coming in the door, about 65% of the businesses that weAt CitySpire, a condominium on West 56th Street, coronavirus protocol includes spraying packages with a disinfectant before bringing them inside.Credit...re forced to close during the pandemic, will not reopen. Fewer entrepreneurs will start businesses and the most important step any business can take will be to ensure their ability to make sales online. For consumers, we may experience unexpected consequences from all our online consumerism. If you’ve tried to return or exchange a purchase during this pandemic you may experience a little more difficulty or longer process. Some stores are not processing exchanges, asking consumers to place a new order, and separately request a return. Roughly one in five clothing items purchased online is returned. If sanitation and spread continue to be a concern stores may restrict their return policy or implement restocking fees as retailers increase measures to sanitize taken back items more thoroughly before reselling. Through this pandemic experience, consumers are purchasing more consciously, showing loyalty to brands that give them confidence and patronizing local stores. 68% of consumers who have shopped locally have tipped more than their usual, and research shows that the pandemic is likely to produce a more sustainable, healthier era of consumption over the next 10 years

5. Just Plain Frugality - Save More

 From virtual game nights to outdoor hikes, Americans have found new ways to have fun and curb boredom. Many Americans expect that we will have to wait several months or longer before routines will normalize and many expect their income to be negatively impacted for a long time. During the Great Depression, families relied on kitchen gardens and community thrift gardens for food sources, it’s not far off that Americans will return to growing their own food, space permitting, or consider moving somewhere that it is possible. As we begin to socialize again, it will be common for friends to gather at a potluck, play board games, or share a drink on the patio instead of going out to the movies and restaurants. Consumers have said they will continue to allocate money to emergency funds and paying off debt before rebooking travel and planning excursions. During the pandemic, Americans have cut spending to save money by buying only the essentials and revising their budget. Consumer’s confidence has dropped 30% since February, and many Americans have run out of what they did have in their savings. Coming out of this pandemic, Millennials especially, are saying they will be saving more. This may create a very risk-averse generation of super savers. For almost everyone, not just millennials, this is a first in a lifetime experience to learn from.

As we continue to wade through the uncertainty it can be jarring to think our current situation could be closer to the new definition of normal that we expect. We are all looking for insight as to when businesses can safely invite all their customers back and when gathering in large groups will be fully approved. We must remember how resilient we can be and know that perseverance is universal. We all should have hope, as this too shall pass


Blog topics: 
Budgeting

Deadlines & Delays

Deadlines & Delays

 

By Kelly Griese

Wednesday, May 6, 2020

The Coronavirus pandemic has caused major disruptions in all our lives. It’s also led to a lot of changes to common deadlines and delayed events. This week, we want to take a look at some of those deadlines and delays. This is by no means a complete list, and if you know of other significant deadlines or delays that you think we should include, feel free to email me, Kelly Griese, at kgriese@sos.in.gov


Courts

A few weeks ago, Indiana Chief Justice Loretta Rush said, “We’re hearing from lawyers, judges, litigants, and law students that the legal system must be more flexible at this time. The Supreme Court is ordering rule changes to ensure certain legal services can be provided with remote capabilities and extending the bar exam application deadline.” You can read the full list of orders on the Judiciary’s website. The orders impact everything from administering oaths and signing legal documents to child custody and bar exams. 


Licenses and Registrations

Earlier this week, select BMV branches resumed serving customers in-person by appointment. It’s important to know that the most common BMV transactions, including license and registration renewals, can be completed online at myBMV.com. If renewing online isn’t possible, you should know that some late fees have been waived. Credit card fees for online transactions have also been waived. If you need to make an in-person appointment, you can learn more about that process by clicking here. Driving skills exams are not currently available.


REAL ID

The deadline for enforcing REAL ID has also been extended. You now have until October 1, 2021. That’s when every air traveler 18 years of age and older will need a REAL ID-compliant driver’s license, state-issued enhanced driver’s license, or another acceptable form of ID to fly within the United States. You can learn more about REAL ID by visiting the Transportation Security Administration’s website


Taxes 

The Indiana Department of Revenue (DOR) has extended certain filing and payment deadlines. Individual tax returns and payments, along with estimated payments that were originally due by April 15, 2020 are now due on July 15, 2020. Corporate tax returns and payments, along with estimated payments that were originally due by April 15 or April 20 are now due on July 15, 2020. Corporate estimated payments originally due on May 15, 2020, are now due on August 17, 2020. You can find a list of all returns affected by visiting DOR’s website

Additionally, extensions for payment plans, registered retail merchant certificates and more can be found in the “Helping Hoosiers” COVID-19 relief services agency announcement or on their Coronavirus web page


Housing Payments

If you’re having trouble making rent or mortgage payments due to the Coronavirus pandemic, you have some options. On March 19, Governor Holcomb issued an order that paused eviction cases, and that pause has been extended through July 1. It doesn’t mean you don’t have to pay your rent! As our friends at Indiana Legal Services explain, “failure to pay rent and other lease violations may result in eviction actions being filed or heard in court after the state of emergency ends. Landlords may not forcibly remove tenants from their rental property, nor can they lock out tenants or discontinue utility services. If a landlord does so, tenants should call local law enforcement. If your landlord attempts to evict you while the pause is in place, you may also file a complaints with the Indiana Attorney General’s office.” Indiana Legal Services may be able to help you if your landlord tries to evict you inappropriately. You can contact their office for an application for legal assistance. 

As for mortgages, you may qualify for delayed mortgage payments without late fees and protection from foreclosure/eviction. The Federal Housing Finance Agency provides more information on who qualifies and how to apply. 


Student Loans

The Consumer Finance Protection Bureau did a great job of explaining current changes to student loan repayment, so we’re going to quote them and suggest you read their full blog post on the subject. “Student loan borrowers now have more benefits to consider when planning for the potential financial impact from coronavirus. A new federal law, the Coronavirus Aid, Relief, and Economic Security (CARES) Act, provides automatic suspension of principal and interest payments on federally-held student loans through September 30, 2020. These suspended payments will count towards any student loan forgiveness program, as long as all other requirements of the loan forgiveness program are met.” It’s important to note that PRIVATE student loans are not included in the CARES Act. For more information about private loans and forbearance, check the Experian blog


Car Insurance

It’s possible you’ve already received an email or letter from your car insurance provider discussing their COVID-19 plans. It makes sense, given we’re driving a lot less these days. According to the Consumer Federation of America, more than 82% of car insurance companies are offering refunds and credits, totaling more than $6.5 billion. To see if your car insurance company is providing relief, check this article from USA Today


Blog topics: 
Credit 

April 2020 Posts

Wills, Trusts, and Estate Planning Basics

Wills, Trusts, and Estate Planning Basics

 

By Kylee Hale

Wednesday, April 29, 2020

 

Death is something we all have in common. It is a fact of life, although it’s not something many of us want to think about. Only 21 percent of Americans have discussed their last wishes with their loved ones and just one in three adults have arranged advanced directive documents such as a living will with medical instructions or power of attorney naming a person responsible for final affairs. Planning for death is not a popular topic, however the thought and discussion should not be avoided. If you have a spouse, children, relatives or close friends it is important to plan for your sake as well as theirs. Having a plan not only makes things easier for your survivors, but it also helps to ensure that the money you worked hard for is distributed properly. 

Wills versus Trust:

Wills and trusts are common words that most are familiar with but the differences are not as commonly known. There are a lot of similarities between wills and trusts. The main reason anyone would elect to set up either, is to have a say in what happens after they are gone. Establishing a will or a trust helps ensure that “last wishes” are fulfilled.

Wills

This document is used to name a beneficiary and state who should receive your property upon your death.  The document also allows you to appoint a legal representative to carry out these wishes. A will only goes into effect after death and passes through probate. Probate is a legal process that takes place in court after someone dies. The process takes time and often results in less money going to the beneficiaries due to attorney and court fees. In probate, the information is public which can result in people fighting over the assets and money. Two important things that can be done with a will but not with a trust, are to name a power of attorney and a guardian for children.  

Trusts

A trust serves as a legal agreement, where a “trustee” is named and holds the legal title to your property for a beneficiary. Trusts can have two types of beneficiaries, the first receives income during their life and the secondary receives the left over funds after the first named beneficiaries have passed away. A trust is effective upon creation and can serve as a mechanism for assets to be distributed before, at death and afterwards. It’s important that the personal property to be transferred is in the trust because the trust retitles the ownership of the property. In addition to estate planning, a trust can be used for planning for a disability and optimal tax results. Depending on the size of the estate and state tax laws, a trust can save a lot of money when the property is transferred to the beneficiary. Estate tax is complicated, however a trust can allow you to increase the estate tax benefit, which helps the beneficiary. As with everything discussed in today’s post, you should talk to a professional to get more information. It’s worth noting that a trust does not go through probate which avoids attorney and court fees and allows the assets to be divided in a shorter amount of time than with a will. 

Who should have one? 

Wills and Trust are for everyone. There are clear advantages to each and it is possible to establish a trust and then follow it with a will, where the will can contain anything that is left out of the trust. For example, any assets or property that are not included in a trust, will be treated as part of the estate and without a will, these assets will be transferred to the heirs per law. This is especially important if the intended beneficiaries differ from the heirs identified by law. A legal document, such as a will or trust, being in place, can confirm who should inherit your items. 

How to establish a Will or Trust?

Setting up a will or trust can be something people avoid just because they don’t know how to go about it. There are multiple options as you can reach out to an attorney or Certified Public Accountant (CPA), or use a self-serve document generating website. One factor that may help you decide which route you choose is the cost. An attorney or a CPA will likely charge anywhere from a couple hundred dollars to a couple thousand dollars, this depends on the complexity of your assets. When selecting a professional to help you draw up a legal document like a will or trust, you want to find an attorney that specializes in estate law. If you choose a self-service website like LegalZoom.com, the variable pricing starts at $89 for a will and $279 for a trust. This website does provide a sample and bundling options, but the actual costs depends on the complexity of your assets. 

Life Insurance

When preparing a plan for “in case”, wills and trusts are useful documents to have in place. In addition to delegating who gets what, it may be important to think about how your survivors will continue on after your death. If you are a main provider for dependents or a spouse, life insurance could be something you want to purchase. Life insurance pays a lump sum to the beneficiaries in the case that you die. This is typically intended to cover burial expenses and replace the income of the person who died. There are various kinds of life insurance, but the two main categories are: term and whole life. Term life insurance allows you to buy coverage that expires and typically the costs are lower when you’re younger. Whole life insurance policies last your entire life and the premium is the same price for the duration of the policy. You can determine how much insurance you will need by thinking about your family and what expenses your family expects. The option to buy multiple term policies is available as well, for example you could buy a policy that you expect to expire after your children graduate from college. Increasing the amount of life insurance you have as your family and exposure grows is a good approach. As your net worth grows and your kids get older you might need less life insurance or you may want more as you near retirement. Plotting out what you might need over the long term of the next few decades will help you determine how much insurance you will need, and talking to a professional should give better insight for planning.

“Open In Case of Death”

While it is unpleasant to think about, it’s important to organize a master folder for all the information we’ve discussed. Sharing this folder and its location with a close friend or family member will make everything smoother for your survivors in an unexpected situation. Even if you do not die but become ill or incapacitated, having a designated place for all the special files that someone would need will reduce stress. In addition to legal documents, it’s beneficial to include financial account access for loans and credit cards, billing log-in credentials for utilities and subscription services, personal identification documents such as a passport or birth certificate and relevant medical information in this folder. In many households, one person takes care of paying the bills and if something happens to that person the others are left trying to put the puzzle together. Implementing a plan and selecting a certain person to handle your affairs when you no longer are able to, can prevent family disputes, and create the best case scenario for a worst case situation.

Thinking about end of life is not easy and if you’ve never thought about it, you’re human. “In case of death” planning doesn’t come to us as a natural thought. Taking the initiative to get things in order, set up legal documents and designate someone to take care of your affairs is the best way to prepare your family for the unfortunate. These steps can make it easier on your loved ones and ensure that they are cared for after you’re gone.


Blog topics: 
Budgeting

COVID-19 Financial Survival Guide

COVID-19 Financial Survival Guide

 

By Kelly Griese

Wednesday, April 22, 2020

If you've been laid off, furloughed, or had your hours at work reduced due to the COVID-19 pandemic, it’s likely you're worried about paying bills. 

For millions of Americans, debt is part of everyday life. We were already struggling with credit card and student loan debt before the Coronavirus. Here are some 2019 fourth quarter statistics. According to research by WalletHub, average credit card debt per household reached $9,070, and total credit card debt for the nation topped $1 trillion after increasing by $57.9 billion. But credit card debt is only part of the picture. According to the Federal Reserve Bank of New York, student loan debt rose by $10 billion, and mortgage debt rose by $120 billion. Total U.S. household debt reached more than $14 trillion. Remember, all of these numbers were calculated BEFORE the pandemic. 

It paints a bleak picture. All that debt and now less money to pay it off, in addition to all the other bills we have to pay: food, healthcare, childcare, utilities, and more. We have a lot of expenses. 


If you haven’t already created a plan, you need to do so immediately. Start by making a list of all your monthly bills. It needs to include absolutely everything from your rent/mortgage to your Netflix subscription. Next, factor in how much you typically spend on food, medicine, and other necessities. What can you eliminate from this list? What can you trim? If you’d like to create a budget, you can download and/or print our budget worksheet

Now consider what help is available. Some companies have special programs right now that could help you endure this crisis. Contact any companies you owe money to and try to work out a new payment plan with lower payments, lower interest, or delayed due dates. Make sure you get any changes in writing. 


Here are some other changes and resources that might help.

Housing 

  • On March 19, Governor Holcomb issued an executive order, temporarily prohibiting residential evictions and foreclosures. Read the order here
  • The Indiana Housing and Community Development Authority (IHCDA) can help with mortgage and rent. Their Hardest Hit Fund provides assistance to families who are at risk of foreclosure. 
  • IHCDA also has a new resource guide that can help you continue paying your rent and mortgage. 
  • The Federal Trade Commission recently published a blog post with a lot of great information regarding mortgage payments. 

Utilities

  • On March 19, Governor Holcomb issued an executive order, prohibiting providers of essential utilities from discontinuing service. Read the order here

Food

  • The website FindHelp.org can connect you to service providers that offer free or low-cost support, as well as assistance with basic needs including food, housing, and bill assistance.  
  • You can also visit the Family and Social Services Administration’s website to see their Food Assistance Accessibility Map

Credit

Unemployment


Finally, make sure you read last week’s MoneyWise Matters blog post. Kylee Hale wrote about the stimulus checks. If you need to check with the IRS on the status of your federal economic impact payment, click this link

Remember, this is a universal crisis, and while each of us will experience different levels of hardship, there are a great many people eager to help those in need. If we work together, we will pull through. 


Blog topics: 
Budgeting, Credit

Stimulus Checks: What You Need To Know

Stimulus Checks: What You Need To Know

 

By Kylee Hale

Wednesday, April 15, 2020

Stimulus Checks

As stimulus checks begin to arrive, here’s what you need to know.

By now, you are probably aware of the Coronavirus Aid, Relief, and Economic Security Act or the CARES Act. You can review the 335 pages of the Act here. I know many people have extra time on their hands right now, but I doubt you desire to read all those pages. This post is meant to serve as a compilation of news regarding the CARES Act which will bring many folks a stimulus check. I’ll give you the details you want to know right now and where you can go to find out more. 

According to the IRS here is the lowdown on stimulus checks:

Who:

Tax filers with adjusted gross income up to $75,000 for individuals and up to $150,000 for married couples filing joint returns will receive the full payment. For filers with income above those amounts, the payment amount is reduced by $5 for each $100 above the $75,000/$150,000 thresholds. However, for those without children, as single filers with income exceeding $99,000 or joint filers with income exceeding $198,000, these folks are not eligible.

What:

Eligible taxpayers who filed tax returns for either 2019 or 2018 will automatically receive an economic impact payment of up to $1,200 for individuals or $2,400 for married couples and up to $500 for each qualifying child (at this time, qualifying child  coverage cuts off after age 16).

How:

For people who have already filed their 2019 tax returns, the IRS will use this information to calculate the payment amount. For those who have not yet filed their return for 2019, the IRS will use information from their 2018 tax filing to calculate the payment. 

Where and when:

On March 30, 2020 the IRS said payments will begin in about 3 weeks, so mid-April is when taxpayers will begin to see the money.  The economic impact payment will be deposited directly into the same banking account reflected on your 2018/2019 tax return or in your mailbox. If you have not previously set up electronic direct deposit and want to, the IRS has set up an online tool, here is the link.

Can you track the stimulus check?

If you are familiar with getting a tax refund, you may know that you can track your refund and see the process as it makes its way to you. However, this stimulus check is a whole new program, but the IRS just recently published another online too, so you CAN track it, check here for updates. 

If you have more questions, follow this link to the IRS website. 


How might you use your stimulus check?

I imagine anyone can think of a way to use a thousand dollars, but here’s some practical reminders of how to make the most of the stimulus check.

  1. Needs, use the money to make sure your essentials are covered. From food and toiletries to rent and utilities. To prioritize your needs, you may want to check if your utility company or the bank in your area is offering a relief option to help those who are struggling to make ends meet during this outbreak.

  2. Your taxes, because the filing and income tax payment deadline has been extended to July 15. If you haven’t prepared for paying your taxes you may use this check to pay what you owe and send the money right back to the government. 

  3. Replenish your emergency fund, if you have dipped into your savings to cover costs for essentials during this outbreak, the stimulus check can be a welcomed refill. 

  4. Reduce debt and loans, owing money can be a financial burden and can impact your overall financial stability. If you don’t need the money to provide essentials currently, paying down debt equals less interest paid later on and more money you’ll have in the future. 

  5. Contribute to a long term investment fund. A great way to make money with little effort is to invest but the key is time. Long-term means that you don’t plan to access the funds for a year or years. Consider investing the stimulus check in a 529 account to use towards you or your kids’ higher education, or contribute to your retirement fund.

If none of the above apply to you and you’re thinking I just can’t wait to see my friends and visit my family, here is a thought. When things turn back to normal, and they will, think about putting funds into your neighborhood. Don't shop online, buy local, put money back into your local economy. This is about supporting one another. If you have a favorite coffee shop, pizza joint, or hair salon in your community, think about how bummed you’ll be if they don’t make it through this. Try to support them and help businesses stay afloat so you can exploit your happiness of enjoying their services long after this is all over.  

These are trying times but we must be patient, this is not an instant gratification situation. We have to be in this together to make a change for all of us to overcome this and enjoy more of what life has to offer later on. Results will take time and the benefit for everyone is in the future. 


Blog topics: 
Credit, Budgeting 

Saving Money & Staying Sane While Staying at Home

Saving Money & Staying Sane While Staying at Home

 

By Kelly Griese

Wednesday, April 8, 2020

We’re all spending a lot more time at home these days. Like many of you, I’m working from my couch. My neighbor’s children are finishing out the school semester via e-learning. Even folks in essential industries, like healthcare, law enforcement, and food services have to find something to do with their free time once they return home from a work shift. So I thought this would be a good time to share some FREE resources that can help you stay sane while following stay-at-home orders. 

This list is by no means complete, but it’s a starting point. If you have additional ideas, we’d love for you to share them with us! You can email me your ideas at kgriese@sos.in.gov, or you can share them via Facebook and Twitter

One important note. We can’t guarantee the safety of any of the computer programs listed below. There have been numerous reports in recent weeks about various programs putting user data at risk. It’s important for you to do your research, read those terms and conditions, and create strong, unique passwords. 


Binge Together

Netflix Party allows you and your friends to binge all your Netflix favorites together, without actually being in the same room. Netflix Party is a Chrome browser extension. It only works on laptops and desktops, not tablets or phones. Here’s how it works. Netflix Party synchronizes video playback and adds group chat to your favorite Netflix programs. 

Visit Zoos, Aquariums, and Museums 

Many of our favorite places to visit are closed to the public right now, but that’s not stopping them from providing you with entertainment from a distance. A quick check of your social media feeds will reveal all sorts of videos and live chats being produced by zoos, aquariums, and museums. Here are some examples. The Indianapolis Zoo has been posting behind the scenes videos showing how their keepers take care of the animals. The Monterey Bay Aquarium has ten different live cameras that let you pretend you’re swimming in the ocean. Museums like the J Paul Getty Museum in Los Angeles offer virtual tours of their art collections. And our own Indiana Statehouse has virtual tours available

Learn Something

Even some scientists have had to press pause on their research, but they’re using their free time to educate others. I’m a huge fan of sharks and the ocean, so my favorite finds so far include Instagram live stories by behavioral ecologist Dr. Tristan Guttridge, webinars by oceanographer Dr. Sylvia Earle, and kid-friendly “Shark Talks” with a variety of experts who work with the National Marine Educators Association. If sharks aren’t your thing, that’s okay. Pick your own passion and start Googling. I’m sure you’ll find something fascinating to learn about while you’re stuck at home. You can even try LinkedIn Learning. LinkedIn has 16 of their courses available for free right now, including courses on productivity, building relationships, and using virtual meeting tools. This could be a great time for you to build your resume by learning some new skills. 

Consult a Tutor

Are you struggling to help your child with their e-learning homework? Don’t sweat it. Help is available. Rose-Hulman Institute of Technology’s AskRose Homework Help is a free math and science tutoring service for Indiana students in grades 6-12. Students can call 877-ASK-ROSE, email, or chat live with a friendly tutor to work through and better understand homework assignments. 

Play Games

There are a slew of apps, programs, and websites that make it possible to play games together. Experienced gamers may prefer MMORPGs (otherwise known as “massively multiplayer online role-playing games”) like Elder Scrolls, World of Warcraft, and Final Fantasy. But if you’re new to the idea of playing games online with other people and want to stick with people you know IRL (“in real life”), why not try the AirConsole app or Board Game Arena? AirConsole enables you to use your smartphone as a gamepad and your computer browser as a console to play more than 150 games with friends. Board Game Arena has 175 games to play, including classics and some exclusives to the website. You play the games through your computer browser after creating a login. 

Get Outside 

Of course, the stay-at-home order doesn’t mean you have to stay locked inside your house or apartment. You can still enjoy the great outdoors! Now is the perfect time to explore nature, even in your own backyard. Why not make some bird feeders, or turn your produce scraps into new plants? The Audubon Society has four DIY bird feeders that the kids can help make. Buzzfeed has a list of 16 food scraps that you can use to start your own vegetable garden

Get Creative

Social distancing scavenger hunts are growing in popularity. This is a great activity for children, and you can choose new themes every week. Just make some art to put in your windows, and then go for a neighborhood walk with a piece of paper and pencil. Make notes of all the window art you find. And here’s another way to get creative outside… make some sidewalk chalk art! You can leave inspirational messages or even create sidewalk “coloring books” by drawing outlines only and letting someone else fill in the drawings with the colors of their choice. 

Get Fit

Gyms are among the many businesses closed right now, but you can still exercise. In addition to walking and running outside, there are numerous ways to get fit inside your own living room. The Yoga Studio of Indianapolis is offering free streaming sessions via Instagram Live. The YMCA of Greater Indianapolis posts workout videos on their Facebook page. And if you were working out with a trainer at your gym, why not email or text them to see if they’re offering virtual training sessions? 

75 More Ideas

Finally, if we haven’t given you enough ways to keep yourself and the kids entertained during the stay-at-home order, our good friend Cherie Lowe – AKA, The Queen of Free – has more than 75 amazing tips, and they're all FREE!


Blog topics: 
Budegting 

Supporting Girl Scouts During Social Distancing

Supporting Girl Scouts During Social Distancing

 

By Kylee Hale

Thursday, April 2, 2020

You may be aware of the Secretary of State’s financial literacy program, Indiana MoneyWise. Our program partners with the Girl Scouts of Central Indiana on many programs throughout the year such as Circle the City, Girl Scout Day at the Statehouse and multiple badge earning programs. With the coronavirus pandemic making it impossible for troops to get together and earn badges with in-person activities, we’re excited to offer online learning and activities to keep girls earning those badges.

Brownie Celebrating Community Badge

This eLearning module is full of exciting fun about why communities are special and how celebrations are a big part of showing love for ones community. 

Time to complete: 20 minutes

Supplies needed: paper, markers or crayons, and your imagination! 

 

 

 

 

Brownie Money Manager Badge

This eLearning module is about wants and needs. After earning this badge girls will be savvy at managing all their cookie money income. 

Time to complete: 20 minutes

Supplies needed: paper, a pen or pencil and a calculator

For more badges and Girl Scout Resources visit girlscoutsIndiana.org

March 2020 Posts

Con Artists in the Age of COVID-19

Con Artists in the Age of COVID-19

 

By Kelly Griese

Wednesday, March 25, 2020

The coronavirus, or COVID-19, is all anyone can talk about. Terms like social distancing, pandemic, and hand sanitizer have been added to our daily vocabulary. We’re discussing toilet paper and hand washing more than ever before. And many of us are finally getting caught-up on binge-worthy series we’ve been meaning to watch for ages. It’s weird. It’s stressful. I understand. But while our guard is up regarding germs, we’re probably a little less guarded when it comes to scams. 

Emergency situations often cause us to react without much thought. Our brains don’t always work the way we want them to when we’re scared, and con artists know it. They exploit our fear for their gain. Sometimes they build scams around natural disasters, such as hurricanes, tornadoes, and even volcanoes. Sometimes the scams are tied to health emergencies, such as COVID-19, Ebola, and swine flu. Whatever the source of our fear, con artists are exceptionally good at creating a scam to go with it. 

Right now, many of us are split between worrying about our health and worrying about our finances. I’m going to focus on scams related to our finances. 


Investment Fraud 

With the current volatility in the market (Kylee wrote about it last week), I want to urge you to be especially cautious when contacted by anyone regarding your investments. If you are contacted, do not give out personal information. Instead, call your investment professional on a number you know to be trustworthy and ask if the contact is legitimate. Some calls could be real, but others could be from people trying to take advantage of this economic turmoil. If you believe you’ve been contacted by someone engaging in investment fraud or fraudulent activities, you can report it to the Indiana Securities Division


Checks from the Government 

By now, you’ve probably heard that the federal government is working on an economic stimulus package that would provide many Americans with money. We don’t yet know how much money or how it will be distributed. But what we do know is that scammers will no doubt try to take advantage of the situation. The Federal Trade Commission shares these tips for protecting yourself: 

  • The government will not ask you to pay anything up front to get this money. No fees. No charges. 
  • The government will not call you to ask for your bank account, credit card, or Social Security numbers. Anyone who does this is a scammer.
  • These reports of checks are not yet a reality. Anyone who tells you they can get you the money now is a scammer. 

Just remember, no matter what this payment winds up being, only scammers will ask you to pay to get it. If you spot one of these scams, report it to the Federal Trade Commission. It’s also a great idea to sign up for the FTC’s consumer alerts


Charity Scams 

In times of crisis, some of us become more charitable. We see others suffering, and we want to help. It’s a wonderful instinct to have, but you need to take caution. Scammers are eager to exploit your generosity. They will use names that sound a lot like the names of real charities and create convincing websites to lure you in. Money lost to bogus charities means less money for those who need it most, so it’s important that you do your research before donating. Here are some tips from the Federal Trade Commission: 

  • When you consider giving to a specific charity, search its name plus “complaint,” “review,” “rating,” or “scam.”
  • Use these organizations to help you research charities. 
  • If someone wants donations in cash, by gift card, or by wiring money, DON’T DO IT! That’s how scammers ask you to pay. 
  • Keep a record of your donations and review your financial statements carefully to make sure you’re only charged for the amount you agreed to donate – and that you’re not signed up to make a recurring donation if that was not your intent. 

In Indiana, charity scams should be reported to the Indiana Attorney General. If you need to make a report in another state, the National Association of State Charity Officials has a great list of all the state charity regulators. 


How Scammers Think

One of the best ways to protect yourself against scammers is to learn how they think. There are far too many scams out there for me to discuss them all, but once you learn the basics, you’ll be able to spot new scams. So here are some things to keep in mind: 

  • Scammers are in a hurry. Time is money, and in order to maximize their returns, scammers need to communicate with as many people as possible as quickly as possible. They will try to rush you into giving them money and/or personal information. Not only does this keep you from taking the time to discover they’re lying, but it helps them move on to their next victim. 
  • Your caller ID could be lying to you. Scammers utilize something called “spoofing” to make it appear as if you’re receiving a call from your normal area code (like 317, 812, and 765). Or they may even put names on the caller ID (like Social Security and IRS). There’s really no way of knowing where the call originates, so never do business over the phone if you can’t verify the caller’s identity. 
  • Scams are often lacking important details. The scammers may make vague, sentimental, or sensational claims but give no specifics. Crucial paperwork is typically missing. 
  • They make unrealistic promises. If anything sounds too good to be true, it is. With investing in particular, beware of anyone who offers guaranteed returns or claims to know about a no-risk investment. Remember that risk and reward go up and down together. There’s no such thing as a high return/low risk investment. 
  • Beware of gifts and incentives. Scammers could say you’re going to win a lot of money or some big prize, such as a vacation or a car. Or they might simply offer some swag or a free trial to open the doors to communication. Legitimate businesses and organizations use these tactics too, so it can be challenging to figure out who to trust. 
  • Scammers make threats. This goes back to using fear as a manipulation tactic. Scammers may talk about arresting you or mention a warrant. They could claim someone you care about is in danger or in need. 

If you notice any of these red flags, contact the proper authorities immediately. If you’re not sure who that is, contact me at kgriese@sos.in.gov. I’ll connect you with the correct agency. 


Blog topics: 
Fraud Prevention

What is Market Correction?

What is Market Correction?

 

By Kylee Hale

Wednesday, March 18, 2020

Market Correction1

With investments, it can be said that a stock index enters “correction” territory when it falls by more than ten percent, and this alarming drop can put many investors on edge. A lot has happened recently in large part due to coronavirus concerns resulting in canceled meetings and reservations, supply chain disruption, an oil price war and on top of that we’re in a presidential election year. As an investor or onlooker, you may be wondering what this really means and what to expect next. So let’s look at some of the common questions. 

Is it the beginning of a bear market? 

Let’s go back and define market correction, there is no universal definition but most consider a correction has occurred when a major index such as the S&P 500 index or Dow Jones Industrial Average, declines from its most recent peak by 10% but still less than 20%. Historically the drop returns or “corrects” prices to their longer-term trend as this is referred to as the “correction”. It’s not really possible to predict whether a correction will reverse or turn into a bear market, meaning that the market falls by 20% or more. As of last week Dow Jones, the S&P 500 and the Nasdaq all entered a bear market. Since November 1974 there have been twenty-two market corrections, four (five if you include the current) of which became bear markets. 

What if this is the start of a declining market?

It’s easy to forget that the market cannot and should not go up indefinitely. After a long run of a bull market, shares of stock are selling at a premium, a correction would be better seen not as a sign of doom but yet as a sign of opportunity. While bear markets can be scary, they are part of long term investing and they don’t last forever. The average bear market has lasted 17 months which is far shorter than the average bull market and they can end as abruptly as they begin. 

How to survive the market dip? 

We don’t know how the coronavirus will play out – nor does anyone, really. While we navigate our way to progress the markets will remain bumpy. This uncertainty is uncomfortable and driving volatility in the markets. We are experiencing an economic slowdown as we’re all affected by the social distancing. What we don’t know is how long it’s going to last, but we can be almost certain to expect growth to rebound, even if it doesn’t happen this year. 

In China, where the outbreak originated, a decline in new cases of the coronavirus is already happening, showing that travel bans and canceling public gatherings is working to stop the spread. Economically, as a country we are in better shape than the 2008 bear market, because our large banks aren’t as highly leveraged, meaning they’re better equipped to handle this now than they were back then. Worrying about the spread of the virus and the bear market is counterproductive, but being prepared is a good approach. 

Is there anything I can do?

Have a plan. A written financial plan can help you weather the storm and calm your nerves. Think of your short and long term goals and stay the course as the market gets bumpy. Consider your risk, it’s easier to take risks when the market is rising, however, market downturns can provide a time to consider adjusting your asset allocation. Remember you can’t lose any more than the money you put into your investments and regular rebalancing will help keep your portfolio on target. If you are tempted to sell and buy again later, CNBC has demonstrated if you had invested in the market from 1999 to 2018 and not touched it, your money would have doubled. But if you had jumped in and jumped out of the market and perhaps missed out on the ten best performing days in the timeframe, your returns would be cut in half. Lastly, it is important to consider your life stage or age. As young investors have time to recover, those nearing retirement would favor diversification and a more conservative approach. It might be a good idea to avoid selling assets and postpone planned withdrawals for large expenses. It's important to remember that a loss is not official until funds are withdrawn and it's recorded on paper.

Blog topics:
Investing

Social Security Impostor Scams

Social Security Impostor Scams

 

By Kelly Griese

Wednesday, March 11, 2020

I had planned to write about something else this week. Then I received SIX calls in one day, from six different phone numbers, and they all left the exact same voicemail. I knew I had to share this information with all of you. Here’s the transcription of the voicemail.  

We are trying to reach you to let you know that your Social Security number is been used for some kind of fraudulent activities in the south border of Texas. So please in order go ahead get more information. To speak with officer, press one. I repeat, press one. Thank you and have a great day.

The voice was computerized. The message was vague. The purpose was clear. This is an impostor scam designed to scare people into providing personally identifiable information to fraudsters. Ironically, I received these SIX voicemails just three days before a massive public awareness campaign launched by the REAL Social Security Administration called “Slam the Scam Day.” 

The Federal Trade Commission says Americans reported losing nearly $153 million to government impostor schemes in 2019. Of that, more than $37 million was lost to Social Security scams. It’s no wonder the Social Security Administration (SSA) is working hard to educate Americans about this scam. The agency regularly posts about it on Facebook, Twitter, Instagram, and LinkedIn. They have created public service announcement videos for YouTube. They write about the scam in the Social Security Matters blog. And they’ve even asked our office to help get the word out. They’d love for all of you to help spread the news as well. I’m hoping this blog post will provide you with the key points you need to know. I’m also hoping you’ll share the information with your friends, family, and coworkers. 

SSA may call you in some situations, but stress that they will NEVER:

  • Threaten you
  • Suspend your Social Security number
  • Demand an immediate payment from you
  • Require payment by cash, gift card, pre-paid debit card, or wire transfer
  • Ask for gift card numbers over the phone or to wire or mail cash

SSA advises that if you receive a suspicious call, HANG UP! Do not give the caller money or personal information. Finally, report the scam to the Office of the Inspector General. You can do so via their website or by calling their hotline: 1-800-269-0271. 

Here are some red flags that you’re talking with a scammer: 

  • The caller says there’s a problem with your Social Security number or account. (That’s what the robocaller claimed in the voicemail I received). 
  • Any call asking you to pay a fine or debt with retail gift cards, wire transfers, pre-paid debit cards, internet currency, or by mailing cash. 
  • Scammers pretend they are from Social Security or another government agency. Caller ID or documents sent by email may look official, but they are not. (Learn more about caller ID “spoofing” by checking out the Federal Communications Commission’s webpage on the subject.) 
  • Callers threaten you with arrest or other legal action. 

Again, the Social Security Administration wants to spread the word. Tell the people in your life about this scam. Share this blog post. Share links to SSA’s content on the subject. And get used to listening to and DELETING a lot of annoying voicemails. 

Blog topics:
Fraud Prevention

Compound Interest Benefits the Lender, Not the Spender.

Compound Interest Benefits the Lender, Not the Spender.

 

By Kylee Hale

Wednesday, March 4, 2020

In my last post, I explained how remarkable compound interest is and how its positive effects can really boost your savings. However, compound interest also applies to most of your debt like student loans, mortgages and unpaid credit card balances. For those who pay compound interest on loans, it can dig a deep hole that may be difficult to escape. Here's a few examples of how compound interest can dig financial holes:

Compound Interest on School Loan

Brandon took out student loans to fund his education, finishing school with $50,000 in student loans at a 7% annual interest rate. Brandon was not able to find a job in his field with a competitive salary, so he entered an income-based repayment program to make ends meet, paying $200 per month. While the repayment program freed up money to help him pay his monthly bills, the payments were not enough to cover the interest on his student loans, much less the principal. After ten years, Brandon’s loan balance grew from $50,000 to $65,866, despite making payments every month. Time and compound interest caused his loan balance to grow. To the right is an example of Brandon’s $50,000 loan with compounding interest creating more debt just over one year.

Brandon’s sister Amanda wanted to go on vacation, but had not saved enough money. Instead of scaling back her plans, she booked a trip to Tahiti on her credit card. Unfortunately, Amanda was unable to pay off her credit card balance, and the interest charges began to compound. Amanda went from owing $10,000 to owing more than $10,786 one year later, even though she paid $150 per month. The credit card’s high 25% interest rate meant that Amanda’s $150 payments didn’t even cover the interest on her debt each month.  

 

What can I do to avoid the pitfalls of compound interest?

  1. Be discerning about debt. Don’t take on unnecessary debt like Amanda did. Make sure you only take on debt that you can afford to pay back, at an interest rate that won’t hinder your ability to save for your future.  
  2. Pay down high-interest debts. If you already have high-interest debt, refinancing to a lower rate could be a solution for you, but might not make sense for everyone. Do your best to pay off high-interest debts before the compound interest takes its toll on your finances.

Compound interest should be used to your advantage, and to invest for your future.  Be cautious in taking on debt and understand how compound interest can derail your finances.


Blog topics:
Investing, Budgeting

February 2020 Posts

The Devil You Know

The Devil You Know

 

By Kelly Griese

Wednesday, February 26, 2020

Affinity Fraud

You know the phrase, “better the devil you know than the devil you don’t,” but it isn’t true when talking about investment fraud. Specifically, I’m talking about affinity fraud. It’s a financial scheme that involves a scammer who appears to be part of a community or interest group. The scammer builds trust within the group and exploits that trust to push fraudulent, non-existent, and too-good-to-be-true investments on other members of the group. 

Simply put, affinity fraud is the wolf in sheep’s clothing. 

Affinity fraud is most likely to occur in groups or communities of like-minded people. You’ll find it almost anywhere that people gather around a shared belief, interest, or goal. Examples include:

  • Places of worship
  • Tight-knit ethnic or immigrant communities
  • Country clubs
  • Professional organizations
  • Places of business
  • Online forums

Why It Works

Affinity fraud is successful for a few reasons. For starters, it’s human nature to trust people who are similar to us. I played a game once with some fourth graders who were visiting the Indiana Statehouse for Statehood Day. In the game, I played the role of an affinity fraudster, and a coworker played the role of a victim. The common interest that my character exploited was a love of the Colts. I started by hyping up the team and sharing stories about watching football. Once it seemed clear the victim saw me as someone trustworthy because of our shared interest, I mentioned a “great investment opportunity.” The victim was excited to hear more. That’s when she turned to the kids, asking if they thought she should invest. They quickly informed her that I could not be trusted, and my greatest joy was having one of those children call me - the fraudster in the skit - a “dirty liar.” 

Another reason why affinity fraud works is that victims are often reluctant to report someone who they feel is part of their group. The victim could be afraid that they won’t be believed or that other members of the group will be angry with them. The fear of reporting allows the fraudster to remain within the group, conning more and more members. 

Here’s an example of affinity fraud shared by the North American Securities Administrators Association (NASAA): 

Desiree has been attending the same church for many years. One day, the pastor introduces a new member of the congregation, Jim. Jim spends the next several months getting to know parishioners, and even reads scriptures and gives sermons for the pastor on occasion. Everyone loves Jim!

Jim gathers a group of parishioners one Sunday after service, including Desiree, and tells them about an exclusive investment opportunity that he has just for them. Jim’s investment pays more than their savings accounts and has zero risk, but he needs a check or cash before he leaves church that day. Desiree knows Jim and trusts him, so she gives him a check for $2,000. Like clockwork, the interest checks come in and the statements Jim gives her show huge gains in her account!

Desiree is so impressed that she gives Jim the rest of her savings and tells her sister Nicole, who also invests with Jim.

Two months later, Desiree stops getting the promised returns. Jim assures Desiree that everything is okay, it’s just an issue with a supplier of the company that is funding the returns. Desiree believes him and agrees to wait it out. Jim stops coming to church, and stops responding to Desiree, Nicole, and the rest of the church members that invested with him. When they report the matter to their local securities regulator, they find out that Jim and the product were unregistered, and that their savings are likely gone forever.


Protect Yourself

So how can you protect yourself? First, know that affinity fraud is common. It happens every day all over the U.S. You should be cautious if you’re ever approached about an investment opportunity at church or in a community group. 

  • Don’t act on personal feelings. People who commit affinity fraud are usually very likable and seem trustworthy. Investors should never let their comfort with a person’s character and status in the community replace adequate due diligence. Ask questions.
  • Don’t act too quickly. If someone offers you a can’t miss investment opportunity and puts you on the spot, don’t be afraid to walk away. Never make an investment decision without understanding where your money is going, how it will be used, and how you can get it back.
  • Everything has risk. There is no such thing as a risk-free investment, and anyone who promises otherwise is lying. Investors should always ask about the risks of the investment, and understand issues such as liquidity, investment time frame, rate of return, risk of loss, and how the proceeds of the investor’s investment will be used to turn the promised profits.
  • Trust but verify. Affinity fraud frequently involves someone that the victim has known for many years. The simple fact that you’ve known a person for 20 years does not replace the need to ask questions about any investment opportunity, and to take pause if you don’t understand it.
  • Always ask if the person and the security are registered. Contact the Indiana Securities Division or search FINRA’s BrokerCheck database to confirm if the salesperson is registered. Regardless of how long you have known a person or been conducting business with an individual, it’s worthwhile to do a quick search in the database to confirm up-to-date licensing and compliance. If the person isn’t registered, ask why, and carefully consider if the investment is worth the risk.

If you think you are a victim of affinity fraud, contact the Indiana Securities Division


Blog topics:
Fraud Prevention, Investing 

Why Compound Interest Matters

Why Compound Interest Matters

 

By Kylee Hale

Wednesday, February 19, 2020

Compound interest has been called the 8th Wonder of the World. It can be a double-edged sword, benefiting those who use it to build wealth, and burdening those who accrue interest on loans and dig themselves into deep financial holes. Let’s discuss the basics of compound interest and the effect it has on your financial future.

What is compound interest and how does it work?
Compound interest is interest calculated on an amount of principal (e.g., a deposit or loan) including all accumulated interest from prior compounding periods. Put more simply, it is interest on top of the interest previously added to the principal. Compound interest causes principal to grow exponentially over time. In the case of invested assets, it is a powerful tool to build wealth.

Examples of how compound interest can help build wealth:

Compound Interest

 

Warren recognized early in life that if he routinely saved and invested, he could accumulate wealth and live a better life. He started investing at 22, adding $500 per month to an account which held an index fund tied to the stock market. The index fund returned 7% per year for the next 40 years, when Warren retired at the age of 62. The initial $500, and the monthly contributions thereafter, grew to almost $1.2 million thanks to time, compound interest, and Warren’s investing strategy.   

Compound Interest

 

 

 

Warren’s friend Charlie wasn’t able to put away as much as Warren during his career, but he invested a $10,000 inheritance at 22 in the same index fund. Charlie’s investment, despite him not adding any more money to it, was worth almost $150,000 when he turned 62.  How? Time and compound investment returns caused Charlie’s inheritance to grow without him adding a penny.

 

 

From these examples, you can see how remarkable compound interest is and why you would want to take advantage of it whenever possible. However, compound interest also applies to most of your debt like student loans, mortgages and unpaid credit card balances. In my next post I will explain how compound interest can have a negative effect and how you can best avoid it. Here are a few tips on how to get the most out of your money with compound interest.

Don’t just save — invest! To take advantage of compound interest, your savings must be in an account that pays some kind of return on investment. That rate will depend upon the amount of risk taken. Higher rates of return are associated with higher risk of loss, and lower rates of return are associated with lower risk of loss.   

Start as early as possible: Time is one of the most important elements of compound interest. The longer your money is invested, the more opportunities it will have to grow. A 25-year-old who puts away $500 a month until age 65 with a 7% rate of return would have nearly $1.2 million, while a 35-year-old doing the same thing would have only $567,000 at age 65.  The earliest years of investing are the most important when it comes to compounding.

Be consistent and patient: Consistent contributions to an investment account over time gives compounding more principal to compound on and can enhance returns. As Warren and Charlie discovered, even modest contributions, paired with investment returns over long periods of time, can help you reach your financial goals.

 Check it out for yourself: The U.S. Securities and Exchange Commission has a compound interest calculator available on their website. Look at what your savings could look like based on different timeframes and rates of return.


Blog topics:
Investing

Love Hurts: How to Spot a Romance Scam

Love Hurts: How to Spot a Romance Scam

 

By Kelly Griese

Wednesday, February 12, 2020

Love Hurts

A quick Google search of the words “Love Hurts song” yields numerous results. The Everly Brothers, Patrick Swayze, Roy Orbison, Rod Stewart, Heart, Joan Jett, and more. They all sang about heartache. It’s relatable. Most of you reading this blog have experienced such emotions and can think of someone in your life who “gave love a bad name.” But the pain of a broken heart can be even greater when THE ONE doesn’t even exist. It can also be costly.

Online dating and social media have made it easier than ever to meet new people. You chat with a lot of them, meet a few for dates in the real world, and hopefully find someone special worthy of additional dates. Or maybe not. One of those online profiles seems too good to be true. The perfect catch! And while they have a lot of reasons why they can't meet in person yet, they want to know everything about you. 

In December 2019, the internet couldn’t get enough of one guy’s online romance. Twitter user @nickturani had met THE ONE! He tweeted, “Ladies take notes! Met this girl online YESTERDAY, and she’s already trying to learn more about me, not just hook up. It’s called conversation. Learn it.” Then he proceeded to share a screen grab of all the things his new girlfriend wanted to know about him. 

  • The name of his first pet
  • His mother’s maiden name
  • The name of the town where he was born

No doubt she would also be interested to learn his Social Security number… you know, typical first date information. 

Obviously, Nick was being “catfished.” If that term is new to you, let me explain. Merriam-Webster defines this type of catfish as "a person who sets up a false personal profile on a social networking site for fradulent or deceptive purposes." Catfishing is sometimes done as a cruel joke, possibly by a person who knows you in real life, but it’s also quite popular as a means of stealing information and money. In the example above, it seems that Nick is aware his new “girlfriend” isn’t real, and he’s making a joke about the blatant attempt to gather answers to password recovery/reset questions. Not only is Nick’s girlfriend not actually interested in him, she’s probably not a person at all. In all likelihood, she’s a bot, which is the common name for autonomous computer programs that can interact with real people online.  

Dating websites and apps are filled with bot accounts, so you need to be careful. Some are obvious, like Nick’s girlfriend, but others are more advanced. And, yes, sometimes a real person is on the other end of the conversation. If you’re dealing with a con artist, brace yourself. They can create compelling backstories with full-fledged identities. They might also use attractive photos of models to lure you in. That’s what happened in a romance scam reported by Bob Segall with WTHR. He talked with a 70-year-old widow who spent two months talking with a con artist named “Richard.” The scammer was after cash, as many of them are. 

According to the Federal Trade Commission, Americans reported losing $143 million to romance scams in 2018. The median reported loss was $2,600, and for people over 70, it was $10,000. Online dating isn’t just for young people. More and more seniors are looking for love via dating websites and apps, creating an even bigger pool of potential victims. 


Spotting Scams

So how can you spot a scam? Here are some great tips provided by the Better Business Bureau

  • Too hot to be true. Scammers offer up good-looking photos and tales of financial success. Be honest with yourself about who would be genuinely interested. If they seem “too perfect,” your alarm bells should ring.
  • In a hurry to get off the site. Catfishers will try very quickly to get you to move to communicating through email, messenger, or phone.
  • Moving fast. A catfisher will begin speaking of a future together and tell you they love you quickly. They often say they’ve never felt this way before.
  • Talk about trust. Catfishers will start manipulating you with talk about trust and how important it is. This will often be a first step to asking you for money.
  • Don’t want to meet. Be wary of someone who always has an excuse to postpone meeting because they say they are traveling or live overseas or are in the military.
  • Suspect language. If the person you are communicating with claims to be from your home town but has poor spelling or grammar, uses overly flowery language, or uses phrases that don’t make sense, that’s a red flag. 
  • Hard luck stories. Before moving on to asking you for money, the scammer may hint at financial troubles like heat being cut off or a stolen car or a sick relative, or they may share a sad story from their past (death of parents or spouse, etc.).

Many of these examples are included in a video created by the Federal Trade Commission.

The Federal Trade Commission provides some additional information about the types of requests that romance scammers often make

  • Pay for a plane ticket or other travel expenses
  • Pay for surgery or other medical expenses
  • Pay customs fees to retrieve something
  • Pay off gambling debts
  • Pay for a visa or other official travel documents

The scammers often ask you to wire the money or purchase prepaid cards from MoneyPak, Amazon, Google Play, iTunes, or Steam. 


Protect Yourself

There are ways to protect yourself from romance scams. The Better Business Bureau provides more tips: 

  • Never send money or personal information that can be used for identity theft to someone you’ve never met in person. Never give someone your credit card information to book a ticket to visit you. Cut off contact if someone starts asking you for information like credit card, bank, or government ID numbers.
  • Ask specific questions about details provided in a profile. A scammer may stumble over remembering details or making a story fit. 
  • Do your research. Many scammers steal photos from the web to use in their profiles. You can do a reverse image lookup using a website like tineye.com or images.google.com to see if the photos on the profile are stolen from somewhere else. You can also search online for a profile name, email, or phone number to see what add up and what doesn’t. 

So, yeah, “Love Hurts,” and scammers certainly “give love a bad name.” I’d use more lyrics and song titles as puns, but I think you get the idea. Stay safe in this season of love and romance. Protect your heart. Protect your identity. Protect your bank account. 


Blog topics:
Fraud Prevention

5 Reasons to Shift Investments

5 Reasons to Shift Investments

 

By Kylee Hale

Wednesday, February 5, 2020

We must start off saying, it's best not to stir up your investments. When you choose to invest, it’s advised to relax and ride out the roller coaster twists of the market. Trying to beat the market is not a good strategy and often doesn’t work. Stick to the motto of investing steadily, diversely and for the long term. This will provide the most foolproof route to success.Set it and forget it

 

However, there are times when Showtime’s rotisserie chicken oven infomercial tagline “Set it and Forget it” just isn’t meeting your needs. Here are 5 relevant situations where you might be better off moving your funds around.

 

  1. New job, new retirement account  

If your employer provides the option to invest in a 401(k), 403(b) or similar retirement saving vehicle your contribution to this investment typically cuts off when you terminate employment with that employer. It’s often a good idea to consider rolling the funds over to your new retirement saving investment vehicle whether that’s a new employer-sponsored plan or a different account of your choosing. It is possible to leave the account as it stands but this could become a loose end. If you choose to roll it over, you’ll want to follow the protocol from the IRS to avoid a tax penalty and opt for a direct rollover to reduce tax filing complications.

Side note: In a previous post, I analyzed the state employee’s paycheck. The state-sponsored 457 plan is yours to keep after you leave state employment, and you can roll it. There is no age penalty but you are responsible for paying income tax on the funds.

 

  1. You're over the fees

There will always be fees, every cent you pay in fees is a cent not in your account, not earning returns. If you’re using a digital adviser, you can expect to be charged about 0.25% - 0.30% of your assets per year. If you’re shelling out for fees themselves, or if moving your investment could lower your fees, it’s probably a good idea to make the move. You may also consider moving your investments if the options you’re looking for aren’t available for you. If impact investing or investments made to generate positive, measurable social and environmental impact alongside a financial return, is your desire, you may have to shift your investments to meet this ambition.

 

Memory Overload

  1. Requires excess memory 

An overall financial picture can be difficult to maintain if you have multiple accounts. Consolidating your investments can ease your stress and create a simpler way to follow your investment goals. Another benefit of having your investments all under one scope is the ability to work with a single person or company. Developing a relationship with one person that you can speed dial with all your investment questions is a relief when it comes to money. Multiple accounts also means multiple logins, statements, and tedious account updates when your address or beneficiaries change.

 

  1. Need some risk or stability

Managing your investments all in one spot can avoid overlapping investments, but it’s still important for your portfolio to stretch across multiple asset classes. Maintaining balance within your portfolio might urge you to shift your asset allocations. Maybe you bought a stock a while ago and then inherited a similar or were gifted an investment. Rebalancing your portfolio helps preserve your desired amount of risk and continue progress towards your goals.

 

  1. Retirement is on your horizon

When you’re getting close to the golden years you may want to reevaluate your assets. You can’t keep money in tax-advantaged retirement accounts forever. There are age restrictions on certain accounts and you are required to begin withdrawing at least the minimum distributions. If you don’t, you will lose that hard-earned and saved money to penalties. It’s easy to forget about an old 401k, from a previous job, if you have not consolidated in a while.​​​​​​

 

As you may have noticed none of the examples above include moving investments due to market dip. It’s important to remember when investing if you experience a market plummet or prolonged downtown, the loss is not locked in until you sell. History shows the market always returns and often surpasses the previous high. If the conditions above apply to you and you decide the time is right to shift your investment, be sure to ask about a direct rollover or in-kind transfer to ease the process. Investments and taxes can be complicated, if you have any questions, be sure to seek out a licensed professional. To confirm a professional licensure, you can search the database on the Securities Portal. 


Blog topics:
Investing

January 2020 Posts

Much Ado About Resolutions

Much Ado About Resolutions

 

By Kelly Griese

Wednesday, January 29, 2020

Did you make a new year’s resolution? University of Scranton psychology professor John C. Norcorss tells CNN that about 40% of Americans set new year’s resolutions, and about 40-44% of those people actually succeed. So what does it take to turn a resolution into a realized goal? CNN provides some good advice in the link above, and I wrote about S.M.A.R.T. goal setting a couple weeks ago in this blog. 

When we set resolutions, we do so for a reason. We want to succeed. But are you putting the correct pieces in place to ensure you reach the finish line before the next ball drop? Try switching out the word resolution and replace it with the word goal. Make that goal specific (that’s the S in S.M.A.R.T.). Make the goal something that’s actually possible to achieve (that’s the A in S.M.A.R.T.). Know that failure is also possible, but that it doesn’t have to mark the end of you trying to reach your goal. Try again and be kind to yourself in the face of failure. 

Change is hard, especially when you consider that the most popular 2020 new year’s resolutions are exercising more and saving money… two things a lot of people struggle to do! According to survey results shared by YouGov, 50% of Americans making resolutions say exercise is their top priority, while 49% are focused on saving money. We can help you with both of those resolutions. The fitness edition of our Indiana MoneyWise e-magazine includes information on yoga for every budget, meal planning, and more. And the Indiana MoneyWise website as a whole is filled with information to help you get on a better financial path. 

Speaking of finances, not all resolutions are equal when it comes to the cost of success. Let’s use the “exercising more” resolution as an example. There are a lot of different ways to exercise, but new gym memberships peak this time of year. So how much will a membership cost you? According to The Motley Fool, the average cost of gym membership is $58.00 per month, or $696 per year. But the monthly fee isn’t your only area of consideration. Many gyms charge an initial fee just for joining, and there may be other hidden costs. Keep in mind that there is a LOT of room for negotiation when joining a gym, and you should check to see if you qualify for any discounts based on your age, your employer, or even your health insurance provider. There are also numerous specials this time of year, so be sure to check online before walking into a high pressured sales pitch at the gym itself. And before joining, make sure you read the contract’s fine print… especially when it comes to the gym’s cancelation policy. 

There’s one more thing we need to talk about when it comes to resolutions, and that’s when to cut ties with anything that’s draining your budget in order to help you achieve them. Don’t hold on to subscriptions and memberships out of guilt or a belief that if you keep paying for these services, you will magically resuscitate your new year’s resolution. If it’s dead, it’s dead. Bury it in a shallow grave rather than digging a deeper debt hole. Cancel the subscriptions and memberships. If you still want to work toward food choice and exercise resolutions, do so in ways that don’t stretch your budget. There’s a wealth of free information online. You can exercise in your living room or local park without expensive equipment. You can shop for your own groceries and cook your own meals without consulting pricy apps first. And if you need accountability to keep you motivated, ask a trusted friend for such help.


Blog topics:
Budgeting

What Exactly is a Real Estate Investment Trust?

What Exactly is a Real Estate Investment Trust?

 

By Kylee Hale

Wednesday, January 22, 2020

In past years, stocks would have been considered the best long term investment, but as of last year, real estate has made its way to the top. According to this Bankrate survey that asked Americans “What is best way to invest money that you wouldn’t need for more than 10 years?” approximately 30% of all generations are in favor of real estate as a long term investment. Real estate can be a very lucrative investment at any age, however it usually requires a lot of money, or very good credit, to get started and is known to be a big time commitment. For busy individuals who might not have the extra cash for a huge down payment, a real estate investment trust (REIT) might be a less demanding way to get started.

Market Exposure - REITs allow investors to pool money together to invest in large-scale, income-producing commercial real estate. These may include office buildings, shopping malls, apartments, hotels, resorts, self-storage facilities, warehouses, and mortgages or loans. This collaboration provides people who may not have the funds to buy commercial real estate on their own with the opportunities to invest but without the time commitment and cost of buying and managing a property. 

Diversity - By being in a different asset class than stocks or bonds, REITs, provide the opportunity to diversify a portfolio. REITs can be found in public and private markets, although publicly-traded REITs are the most liquid. Before investing in a REIT, you should understand whether or not it is publicly traded, and how this could affect the benefits and risks to you. For more, check out FINRA’s Investor Alert on reviewing non-traded REITs.

Appreciation - REITs are generally passive investments as opposed to active…meaning that they are generally suited best for long term investors rather than short term. Unlike other real estate companies, a REIT does not develop real estate properties to resell them. Instead, a REIT buys and develops properties primarily to operate them as part of its investment portfolio. A benefit to investing in REITs is the potential for long-term appreciation, if the real estate market you're invested in gains value, your shares may too.

Fees - Publicly traded REITs can be purchased through a broker. Generally, you can purchase the common stock, preferred stock, or debt security of a publicly-traded REIT. Brokerage fees will apply. Non-traded REITs are typically sold by a broker or financial adviser. Non-traded REITs generally have high up-front fees. Sales commissions and upfront offering fees usually total approximately 9 to 10 percent of the investment. These costs lower the value of the investment by a significant amount. 

Taxes - When the REIT collects rental income from its properties, at least 90% of those earnings are returned to the investors as dividends. The shareholders of a REIT are responsible for paying taxes on the dividends and any capital gains they receive in connection with their investment in the REIT. Dividends paid by REITs generally are treated as ordinary income and are not entitled to the reduced tax rates on other types of corporate dividends.

REITs provide the option to add real estate to an investment portfolio when it otherwise might not be feasible. Some REITs yield higher profit dividends than other investments, but with reward comes risk. Be extra cautious of non-exchange traded REITs and fraudulent salesmen. You can verify the registration of both publicly traded and non-traded REITs through the Securities and Exchange Commission’s EDGAR system. You can also use EDGAR to review a REIT’s annual and quarterly reports as well as any offering prospectus. Lastly, you should also check out the broker or investment adviser who recommends purchasing a REIT. To learn how to do so, visit the SEC’s Investor.gov page: Working with Brokers and Investment Advisers.


Blog topics:
Investing

Financial Relationship Status: It's Complicated

Financial Relationship Status: It's Complicated

 

By Kelly Griese

Wednesday, January 15, 2020

Let’s face it, we are emotional spenders. Few of us are able to make purely logical financial decisions. Instead, we spend based on how we feel, and our feelings are impacted by a lot of internal and external forces. If our relationship with money was a Facebook status, it would be listed as “it’s complicated.” And to make matters more complicated, our financial behavior is set at an earlier age than most of us realize. 

According to a study from Cambridge University, not only are kids able to grasp basic money concepts as early as age 3, but money habits are set as young as age 7. By the time we reach the age of making major financial decisions, we’re already firmly set in our ways. And that’s why it’s okay if you’re struggling to change. Improving our financial behavior is hard, and it takes much more than some facts and figures on a spreadsheet to make changes. 


Pay Yourself First

So how do we begin? Well, I like to start with some of the best financial advice I’ve ever heard: PAY YOURSELF FIRST! When faced with a financial decision, repeat those three words in your head. Each time you buy something new and exciting, you are paying someone else. You are giving them money in exchange for the latest gadget you crave. 

Paying YOURSELF means setting aside money for YOUR future. This requires discipline. It also requires you to think beyond your need for immediate gratification. If you find yourself frequently tempted into making impulse buys, look for ways to remind yourself of the things you want months or even years from now. Do you want a new car? What about an awesome vacation? Retirement? 

Spending that money now can make us feel good in the short term (remember, we spend with our feelings), but in a few years, when we really want/need something big, the money won’t be there. If you’re still working when you’re in your 80s, you may regret not paying yourself first.


Values

Now let’s talk about some of those intangible things that influence our emotional spending. Things like values. Values are qualities or standards people consider to be worthwhile or desirable. These are the basic and fundamental beliefs that guide or motivate our attitudes and actions. Examples include: accomplishment, community, entertainment, generosity, and so on. You may possess some of these values or different ones. Take a moment to think about what you truly value and write it down. Better yet, prioritize your values. When I give financial fitness presentations, I provide folks with a worksheet, so feel free to print a copy for yourself


Goals

Now let’s talk about goals. Goals are the specific plans or purposes we have in life. Short-term goals can be accomplished in a few weeks, months, or even a year.  Examples include setting up a savings account and using it, building an emergency fund, or saving for a family vacation.  Long-term goals require more planning and saving, and they are often not realized for many years.  Popular long-term goals include homeownership, a college education, or a comfortable retirement.  

Unfortunately, goals are somewhat meaningless without a plan to achieve them. That’s why I encourage you to create SMART goals. SMART is an acronym. 

  • Specific – state exactly what you want to buy or accomplish with the money you save
  • Measurable – indicate the exact dollar amount you need in order to reach the goal
  • Attainable/Achievable – identify the necessary steps to achieve this goal
  • Relevant – the goal needs to be meaningful or you may lose motivation
  • Time-Bound – the goal should have a deadline for achievement 

Let’s transform a regular goal, such as “I want to buy a car” into a SMART goal. “I plan to save for a down payment on a new car. I need to save $5,000 for the down payment. I will reach my goal of saving $5,000 by setting aside $200 from my paycheck each month. I need a new car because my current car is getting old and repairs will become costly. By saving $200 a month, I will save $5,000 in 25 months (or two years and one month).”

Now that’s a SMART goal! To help you create your own SMART goals, print the worksheet I created.


Wants vs Needs

Now that we’ve established our values and goals, it’s time to buy stuff, right? Not yet. We need to talk about wants versus needs. 

As children, we are taught that needs are the stuff that’s necessary for survival: food, water, shelter. Wants are all the stuff we can live without but would enjoy having. Using these simple definitions, we can put things like rent, groceries, and transportation into the needs category, and most of our entertainment options are considered wants. But this whole post is about our complicated relationship with money, and wants and needs are not quite so simple. 

A few years ago, I was helping some local Girl Scouts earn their Junior level Savvy Shopper badge. We made collage posters with magazine clippings, with wants on the right side of the poster and needs on the left side. One girl brought up an interesting question: where does deodorant go? It sparked an insightful conversation that helped me realize our wants and needs are more complicated and simply deciding what’s necessary for survival. The girls and I talked about how it might be hard to make friends or get a job if we smell bad. We Googled the history of deodorant (great article can be found here).  We even discussed cultural differences related to hygiene. In the end, we decided that wants and needs are complicated. They are also unique and personal. Everyone has different priorities, and so everyone has different wants and needs. Identify your own wants and needs, just as you did with your values and goals. Your spending and saving decisions should be reflective of these choices. To help you determine your own wants and needs, we have another worksheet you can complete. It’s a great activity to do with other members of your family. 


So how will all of this critical thinking improve your financial situation? Wants, needs, values, and goals are important parts of every budget. After you have identified the emotional drivers behind your spending and saving decisions, start a spending log. I recommend using it for at least a week, but a month is preferred. Keep track of every last cent! In addition to writing down the date, purchase, and cost of all your expenses, also write whether they satisfy wants or needs. You can use this spending log to help you make adjustments to your budget. Spending logs are great at revealing problematic spending. We have a spending log worksheet as well as a budget worksheet that you can print. 


Blog topics:
Budgeting, Credit

New Year, New You, Anatomy of Your Paycheck Part 2

New Year, New You, Anatomy of Your Paycheck Part 2

 

By Kylee Hale

Wednesday, January 8, 2020

On average, an employee’s salary makes up seventy percent of their total compensation, while the remaining thirty percent is compiled of fringe benefits. These “extras” often include; insurance, tuition reimbursement, childcare, retirement plan contributions, and discounts. In my first post about understanding your paycheck, I discussed the common terms on most pay stubs such as Gross Income and Net Pay. In this post, I’m going to dive deeper into the deductions listed on most pay stubs to explain where every penny goes to determine your take-home check. 

Before we talk benefits, I want to point out, about thirty percent of your Gross Income is reduced by taxes. Tax withholdings are dependent upon your W-4 form filling, the example pay stub (right) for John Smith is claiming one exemption. Multiple income tax withholdings are calculated according to a person’s claimed exemptions.

Federal Income Tax: Federal tax is calculated by tax brackets determined by taxable income and your tax filing status: single, married filing jointly, married filing separately, etc. There are Paycheckseven tax brackets, the progressive tax system allows your taxable income to be taxed in chunks according to the portion of income that falls in each tax rate category. John Smith is a single filer with $32,692.30 in annual taxable income. That puts him in the 12% tax bracket in 2019, but he only pays 10% on the first $9,700 of income, then he pays 12% on the rest up to $39,475 of taxable income, because the next bracket of 22% begins with $39,476 taxable income.

FICA/Medicare: Federal Insurance Contribution Act (FICA) tax is a payroll tax that funds Social Security benefits and Medicare health insurance. This tax is split between employers and employees who both pay 7.65% (6.2% for Social Security, 1.45% for Medicare). You can calculate these individually but for many employers, these are lumped together. John Smith is paying $95.38 for FICA and $22.30 for Medicare each pay period, equaling $117.68 together.

State Income Tax: Some states do not collect income tax, some collect a flat rate and some impose a progressive tax meaning people with higher levels of income pay higher taxes. The state of Indiana has a flat tax rate of 3.23%. John Smith will pay $49.69 per pay period or $1,242.25 a year in state income tax.

Local Tax: This is also known as county tax, in Indiana, this is based on your County of residence as of January 1 per tax year. For John Smith's pay stub, he is a Marion county resident with a tax rate of 0.0202%. 

Insurance Premiums: Most pay stubs itemize the insurance premiums for the services you selected. For health, dental, vision, life and disability, your employer likely requires you to pay a portion of the premium. These costs are deducted from your gross pay. If your employer offers TaxSaver benefits, this prevents you from paying tax on the premiums. John Smith has medical, dental, vision and life insurance on a single plan, rather than a family plan. If applicable, this section of your pay stub is also where you will find disability insurance. For state of Indiana employees, I have found that the employee portion of the premium for disability insurance is about 0.0025% per paycheck. 

Other deductions: Depending on your employer, there may be additional deductions. For example, if you choose to donate part of your paycheck to a charity that partners with your employer — like the State Employees' Community Campaign (SECC), this should appear on your pay stub.

Deferred Compensation: These funds are also known as your retirement money. The tax is deferred on this income until payout which is likely in your retirement years. The strategy with this is that you benefit from a lesser tax burden at the pay out because you expect to be in a lower tax bracket after retiring, than when you initially earned the income.

The Direct Deposit amount is your take-home pay, also known as net pay. Most pay stubs include how much you've received year to date (YTD).

The last section of the state employee paycheck, Employer Provided Benefits, is my favorite. Most employers who offer benefits are required to pay a portion of the premiums for the employee’s coverage. For example, while John Smith pays $1.22 per pay period towards his premium for dental insurance, his employer pays $10.38 per pay period towards the premium. This is the same for medical, vision, life and disability insurance premiums. 

Let’s talk about retirement accounts, this will be different for non-state employees, but I hope this information will provide some insight and spur you to find out more about how your employer retirement accounts are structured. 

On John Smith’s pay stub, we see the deductions titled:

Def Comp.: This refers to a Target Retirement Fund account offered by Hoosier S.T.A.R.T., sometimes also referred to as a 457 plan, only for state and local government employees and some non-profits. This is similar to a 401(k) plan that might be offered by a private employer.

PERF St and PERF Spe: This could be referred to as your state employee pension and the state pays 100% of the cost. While employed, the state will continue to put money into these accounts, this is provided by INPRS. This appears as two separate contributions on the pay stub because a portion is invested via an annuity and the other via Target Date Funds

Def Comp St Pd: This is another Hoosier S.T.A.R.T. sponsored retirement plan, sometimes referred to as a 401(a) plan. The unique feature of this plan is, state employees receive a $15-per-paycheck matching contribution which equates to $30/month or $390/year of “free money”. Another way of thinking is to view the state’s match as BOGO, you put in $15 a payday and the state will match that giving you $15 in your account each payday. It’s wise to contribute at least up to the match so you’re getting the benefit of all the money your employer is offering and padding your retirement savings.

HSA Employer: The last thing to mention is a Health Savings Account (HSA). If enrolled in a High Deductible Health insurance Plan (HDHP), you qualify for an HSA, an account allowing you to save specifically for medical costs. As an employer, the state of Indiana contributes thirty-nine percent of your annual deductible into your HSA. Your contributions to an HSA are pre-tax or tax-deductible and you don’t pay tax on the account’s growth nor the withdrawals if used for eligible expenses. An HSA is similar to a Flexible Spending Account (FSA), although an FSA does not allow for the leftover funds to roll over to the next year, and an FSA is often better paired with a lower deductible health insurance plan.

It’s important to stay on top of tracking your deductions and contributions. Any errors are your responsibility to find and report, the last thing you want is for an error to be repeated through several pay periods.

I can write from experience, my first year as a state of Indiana employee, somewhere a mistake was made by HR. The information on my W-4 was incorrectly filed in the system. For about seven months my taxes were withheld in “married” filing status, although I would be filing as “single”. I noticed this on my paystub a little too late in the year, and when tax filing time came around, I owed more than I was excited to pay.

If you have questions about any of the information listed on your pay stub, be sure to contact your human resources representative.     


Blog topics:
Budgeting, Credit  

 

December 2019 Posts

The Anatomy of Your Paycheck

The Anatomy of Your Paycheck

 

By Kylee Hale

Wednesday, December 18, 2019

Most people don’t get a pay stub delivered to them along with the paycheck anymore, because most employers issue a direct deposit check and theState Employee Paycheck funds just appear in your bank account. This doesn’t mean that pay stubs no longer exist, or that pay stubs are no longer important. Reviewing your pay stub can help you spot errors and be aware of where the money that isn’t deposited into your account is going. There is good information about your finances located on this slip, knowing about your withholdings, taxes, benefits and retirement contributions can help you be better off financially. In this post, I’ll show you how to locate your pay stub (for state of Indiana employees), and define some of the information you see on your pay stub. If you are not a state of Indiana employee, check with your Human Resources Department.

For state of Indiana employees, your pay stub can be found in PeopleSoft. The same place you go to submit your time, except instead of selecting "Time Reporting", you'll go to "Payroll and Compensation". From there, you click on "Pay Inquiry" and this will open a new window with your pay stub. 

Now that you've found your pay stub, again, if you are not a state of Indiana employee, be sure to ask your HR department, let's look at the earnings and taxes. Below is an example of a pay stub for John Smith, making a $40,000 salary. 

Pay stub example

For state of Indiana employees, we have information about our employment anniversary (Bonus Date) at the top of our paychecks, this refers to when you will be awarded paid time off. You can find more about this in the State of Indiana Employee Handbook, or your agency's employee handbook. Just below that, is your Tax Filing Status, this correlates to the W-4 tax form that you completed with your HR representative. You can change your exemptions at any time, this will impact your take home pay amount. If you opt for less money withheld for federal taxes, you need to plan ahead for tax filing season, as you might owe money instead of getting a tax return. The IRS has an IRS Withholding Calculator that can help you estimate what you should claim on your W-4.

The majority of your paystub describes income earnings, tax withholdings, retirement contributions and medical premiums. Let's review some common terms. 

Pay Period: The dates on your pay stub will inform you of your pay schedule, whether it's weekly, bi-weekly, or monthly. If you're paid weekly you would multiply the pay by 52 to calculate the annual salary. If paid bi-weekly multiply by 26, and if paid monthly, multiply by 12. State of Indiana employees are paid bi-weekly or 26 times a year. 

Gross Earnings: This is the total amount earned for the pay period, including wages/salary, plus bonuses and tips if applicable. For this example, the pay stub shows how much John Smith has earned year to date (YTD), after 25 out of 26 pay periods. 

Non Taxable Earnings: The IRS definition of a non-taxable wage is fairly narrow, but an example of such is disability wages and worker's compensation. 

Deferred Compensation: This part of your income is set aside to be paid to you at a later time, also known as invested retirement funds. You don't pay taxes on this portion of income until the money is paid out.

TaxSaver Benefits (Cafeteria 125 Plan): This is an employee benefit offered by section 125 of the Internal Revenue Code, allowing for your premiums to be deducted before taxes are applied to your income. This allows for your take home pay to be a little bit bigger. 

Taxable Earnings: This portion of your income, is used to figure the taxes you'll pay to Federal, State and Local entities as well as your premium for Medicare/FICA. You can learn more about tax and premium calculations in the next post, The Anatomy of Your Paycheck Part Two, where I break down the other half of your paycheck.

Some pay stubs summarize your paid time off. Like you can see on John Smith's pay stub, state of Indiana employee pay stubs reflect overall taxes, deductions and take-home income for the pay period and YTD. 

Net Pay: This is your take-home pay. Calculated after all taxes, insurance premiums, deferred compensation/retirement contributions and deductions have been subtracted out, this is the remainder of your income. 

If you're like most people, the number on your pay stub that really matters is the cash dollar amount on your paycheck. We are all excited to get paid and have money deposited into our accounts. Although, it is important to review your pay stub, being tuned into where every dollar goes will help you take full advantage of your employee benefits. If there is a mistake in your pay or an opportunity to better your retirement or take-home pay, this is where you'll likely notice it. In our next post, we will analyze another part of your pay stub: insurance premiums and retirement accounts. Be sure to check out the Anatomy of Your Paycheck Part Two on January 8, 2020. This will be our first post of the New Year. 


Blog topics:
Budgeting, Credit

Save Energy, Save Money

Save Energy, Save Money

 

By Kelly Griese

Wednesday, December 11, 2019

Save Energy, Save Money

We already know you love saving money, because you’re reading the MoneyWise Matters blog (and are hopefully a subscriber)! That’s why we’re confident you’ll love this post, because it’s all about saving money… and energy. How great is that? You can help the planet and your budget at the same time. 

In order to help you improve your home’s energy efficiency, we teamed up with Indianapolis Power & Light Company. They taught us that small changes can have a big impact on energy bills. But if you’re not an IPL customer, don’t worry, we have links to energy providers in your community at the end of this article.

Here are five easy things you can do this weekend to improve your energy efficiency:

  1. Replace the air filter in your furnace every 6 months. A clogged filter is problematic for several reasons. When it comes to energy efficiency, a clogged filter requires your furnace to work harder. Replacing the filter will not only improve the air quality of your home, but it will allow that air to flow through the filter with greater ease. (Side note… you should also consider cleaning the air vents and hoses that connect to your clothing dryer. Dryers also have to work harder when the vents and hoses are clogged with dust, plus, all that debris is a fire hazard.) 
  2. Replace the incandescent light bulbs in your home with LED bulbs. Incandescent bulbs may cost a little less in the store (as little as 70 cents per bulb), but they don’t last nearly as long (about 1,000 hours), and 90% of the energy is wasted in heat, while only 10% goes toward producing light. Meanwhile, standard LED bulbs run anywhere from $1-$3, but they are much more efficient and will last a lot longer (about 25,000 hours). According to Energy.gov, your lighting energy costs can be cut 50%-80% by switching out your incandescent light bulbs to LEDs.
  3. Using setbacks on your thermostat is another great way to get significant savings. In the winter, 68 degrees is the recommended temperature when you are home and awake, and 63 degrees is recommended when you are away at work or on vacation. In the summer, it is best to set your thermostat to 78 degrees when you are home and 83 degrees when you are away.
  4. Seal air leaks and cover drafty windows. Replacing windows can be expensive and time consuming, but there are plastic kits you can buy in most home-improvement stores to help you insulate the windows you have in the meantime. Install new caulking and weather-stripping to help seal air leaks around doors because they can wear out over time or may have never been installed when your home was built.
  5. Unplug electronics and appliances that are not being used. If you have a guest room, that is a great place to start. Nearly everything that plugs into the wall outlet will draw small amounts of power even when turned off. You can save energy by unplugging anything you do not regularly use. You may also want to consider an energy efficient power strip for your entertainment system. It will cut power to devices that are not in use, but still provide power to things like your internet modem and DVR when you are away from home.

To tackle some of these projects and identify other energy bandits in our homes, one of our Indianapolis-based staff members scheduled a FREE energy assessment with IPL. Watch as Brandon Kline, our Elections Outreach Coordinator, tours his home with Casey Roehm from CLEAResult®, who manages IPL’s residential and commercial energy efficiency programs. 

IPL’s eScore™ Home Energy Assessment is free to IPL customers. An energy advisor will come to your home, conduct a walk-through assessment, and install energy-efficient products to help you start saving immediately. Your home will be given an eScore of 1-10, and the energy advisor will provide you with recommendations to improve that score. All of the recommendations will appear in your eScore dashboard, which you can view online when you log into your IPL account.  One of the “coolest” parts about the eScore program is that the advisor can install a FREE smart thermostat by Nest. To qualify, customers must enroll in IPL’s CoolCents® program, and they must have electric heat or central cooling, a compatible HVAC system and working Wi-Fi. You can learn more about the CoolCents® program by clicking here


So what if you’re not an IPL customer? Energy providers throughout Indiana offer similar ways to save. We compiled a list of the energy efficient programs in other parts of the state.


Blog topics:
Budgeting, Credit 

Rein in Holiday Spending

Rein in Holiday Spending

 

By Kylee Hale

Wednesday, December 4, 2019

For some, overspending and under preparing is as habitual as the holiday season itself. An albatross of debt on your shoulders is no way to start the New Year. Financial prosperity requires financial planning. To ensure your holidays are merry this year, check out these approaches to stretch your funds without being a Scrooge. 

A Plan for Affordability:

Make a list and check it twice. Establishing a gifting budget is the best way to keep yourself from overspending. Jot down an outline of who you are buying for and how much can be allotted to each. Look for things you canSant's List trim, try to avoid gag gifts that may go unused or discarded soon after unwrapped. Most importantly, use self-control and stick to your budget. 

Retail SaleAvoid impulse shopping. Retail stores strategically place items conveniently at the checkout and on aisle end caps. It can be hard to resist grabbing additional items, but too many stocking stuffers can add up to a large total of spending. Don’t succumb to the temptation and remember that if you didn’t intend to buy it, then you probably don’t need it. 

Price check online before you buy. If you see something in a store that looks like a good deal, use your smartphone to check prices at other retailers before making your purchase. Some apps, like Amazon, even have barcode scanner to make the price check process easier and you can read the reviews as well. Also, check for price adjustments, many merchants price adjust for up to two weeks, just keep the receipt and an eye on your product’s price. 

gift exchangeDo not buy for everyone and their brother. Do you have a seemingly endless number of family members? Are you compelled to buy for every co-worker? Try alternative ideas, like sharing a meal together as a group or a weekend trip. I’ve heard of relatives agreeing to only buy for the children, that is, if there are less kids than adults in the group. Cut down on the extent of gift giving by trying a White Elephant gift exchange

Use plastic to your advantage. Credit cards can be unnerving, especially during the holiday season when overspending can send you down the rabbit hole of debt. However, if you’re responsible with your spending, why not get cash back for the money you’re spending. Use your credit card to earn rewards by always paying your balance in full. You can receive gift cards or travel miles as rewards, which are often worth more than cash back.

If you’ve stressed about holiday spending before and how to afford all the festivities, these tips will help you enjoy the hustle and bustle a lot more. Time spent with family and friends is more enjoyable when you’re not worrying about your finances. Just remember, the holiday season doesn’t require spending every last dime you have. Being able to afford your holiday spending in cash may be the best gift of all.


Blog topics:
Budgeting

November 2019 Posts

Shop Smart, Shop Safe

Shop Smart, Shop Safe

 

By Kelly Griese

Wednesday, November 27, 2019

Before your Thanksgiving feast even has a chance to fully digest, many of you will start shopping. And while plenty of folks choose to burn a few calories by bargain shopping at traditional brick and mortar stores, others prefer to lean back in the La-Z-Boy to shop online while watching football. No matter your style, these tips will lead to a safer, smarter shopping experience.  


Security
When shopping online, make sure the site is secure before sharing your personal information. Look for a tiny padlock icon, which you can usually find near the browser’s URL bar. Also check the website’s address. Non-secure sites and pages begin with http://. Secure sites and pages begin with https://. You’ll also want to research the online retailer to make sure they’re legit. Creating a website is easy, so you’ll want to verify the online seller’s physical address and phone number. 


Hidden Costs and Fees
Check the total price of an item before purchasing. Look for shipping and handling costs, then compare that price to what you would pay if you visited the store in person. You should also beware of restocking fees. If you return an item you bought online, you may have to pay for that item to be repackaged and replaced. Some retailers charge 25% or more, so it’s important to check the retailer’s return policy before making an online purchase. CBS News recently published its list of the best and worst return policies. If you’re someone who suffers from chronic buyer’s remorse, you may want to read the article before making your next purchase.  


Shipping
Save on shipping. Ship packages directly to the recipients rather than spending the extra money to ship to yourself first. Slower shipping methods are always cheaper, so don’t wait until the last minute to make online purchases. While an increasing number of online retailers offer free shipping (check The Penny Hoarder’s list of 35 stores that offer free shipping), others throw in the free shipping based on how much you purchase. In those cases, it’s best to order from as few stores as possible. One more tip: some of the most popular retailers, including Walmart, now offer free in-store pick-up for your online purchases. 


Credit vs Debit
When shopping online, credit cards are safer than debit cards. Credit cards come with more protections against identity theft and fraud. It’s also helpful if you only use one credit card for all your online shopping. If a thief does access your information, only one card is compromised, making it easier for you to put a stop to the theft. Prepaid cards are growing in popularity for online purchases. Before picking a prepaid card, check out this editorial article from CreditCards.com about some of the pros and cons of these cards. It includes tips for selecting the right card for your needs. 


Layaway
Layaway is back in a big way! Unlike a credit card, which bills you after you have your purchase in hand, layaway allows you to make payments in advance. You won’t receive your purchase until after you have fully paid for it. It’s a helpful tool for staying out of debt around the holidays. To use layaway properly, follow these tips: 

  • Determine what the layaway policies and fees are prior to using it. Ask about the payment period, when payments are due, and what happens if you miss a payment or the item goes on sale while still on layaway. 
  • Make all scheduled payments. Policies vary by store. In some cases, the item could be pulled from layaway and you could be asked to pay a fine if you miss a payment.
  • Get everything in writing. When you put something on layaway, you are entering into a contract with the store and agreeing to pay for the item they’re holding for you. Make sure your responsibilities as well as the store’s responsibilities are clearly outlined and don’t lose your copy! 
  • Know who is in charge of the layaway program. Some retailers use third-party vendors for their online layaway services. Also, you should know whether your merchandise might be held off-site.
  • Understand the store’s refund policy. Some stores may include a cancellation fee if you try to cancel the purchase. Stores may also refund all, little, or none of the money you have paid for the purchase, or they may give you in-store credit. 

For more online shopping tips, check the Federal Trade Commission’s blog. They recently published a great article on the topic, and it includes information about how to report online shopping fraud. 


Blog topics:
Fraud Prevention, Credit, Budgeting

Let's Talk Money

Let's Talk Money

 

By Kelly Griese

Wednesday, November 20, 2019

Having “The Talk”
If you’re a parent, seeing the words “the talk” in quotation marks may make you nervous. You probably assume it pertains to a discussion of the birds and the bees. But in this case, “the talk” pertains to an even more taboo topic: money. A quick Google search reveals article after article on how we would rather have an awkward conversation about sex, politics, or religion than delve into the ultra-uncomfortable subject of money. Gary Dayton, a licensed psychologist and head of Peak Psychology in Glastonbury, Connecticut, was quoted in a recent US News report. “To many, money symbolizes comfort and living with ease, but it can also bring up scary issues of dependence, insecurity and even survival,” Dayton said. When you put it that way, it’s no wonder we’re all so afraid to discuss our finances! Money means a lot to us. It can represent status, power, security, stress, weakness, mistakes and more. We judge ourselves and others based on how much money (and debt) everyone has. Right or wrong, it’s common. So how do we broach such a difficult conversation with our loved ones, and why should we? 

Why You Should Talk about Money
Let’s start with the why. Keeping our finances a secret allows for a lot of problems to fester. Think of the room in your house where guests aren’t allowed. It’s where you hide all the junk you don’t want them to see. The rest of the house may look picture perfect for a party, but that’s because you stashed all the clutter in that one room that’s off-limits. You might impress everyone for the time being, but what happens if someone stumbles into the messy room? Rather than hiding your secrets, wouldn’t it be better to fix the problems you’ve shoved out of sight? Purge the room of all that stuff you no longer need or want and give it a good scrubbing. Most importantly, don’t refill the room once you’ve cleaned it! By opening up our whole home for exploration and presenting an honest version of ourselves to the world, we’re motivated to tackle problem areas and maintain them moving forward. Think of your finances in the same way. Hiding money problems from your spouse, children, and parents won’t make those problems go away. They’ll grow to the point of crisis. So make a plan to discuss what’s wrong and work together to improve your financial lives. 

When You Should Talk about Money
The holidays can actually be a great time to discuss finances. On Thanksgiving, it’s common for multiple generations of a family to gather together to celebrate. It’s a time to reflect on all the good things in your life for which you are thankful. And this date sadly can precede a time of excess spending in preparation for Christmas. So before rushing out to shop on Black Friday, take some time to discuss what you can truly afford to spend. Or, perhaps decide as a family to change up the way you have traditionally celebrated Christmas. You could forgo presents all together, arrange a Secret Santa system, or even decide to pool all your money together for a shared adventure that will create wonderful memories. 

How to Start a Conversation about Money
Starting a conversation about money is easier than you think. You don’t have to air all your dirty laundry right away. It’s fine to ease into these talks and gradually discuss more and more difficult things. Here are some conversation starters from the North American Securities Administrators Association (NASAA) that you can use to begin the process. 


Conversations for Couples - Communication is an essential part of a healthy relationship. Your money talk should be an open and honest dialogue with your spouse or significant other about your current financial situation and goals. 

Budgeting 

  • How much of our income should go toward fixed expenses (i.e. rent, insurance) versus flexible expenses (i.e. entertainment, savings, investments)?
  • Have we determined our priorities for flexible income and expenses?
  • Do we have similar habits or views on how to manage money?

Saving

  • What are our short and long term financial goals?
  • Are we prepared for unexpected financial hardships?
  • Are there ways we could spend less and save more?

Investing

  • How much risk are we willing to take with our money?
  • What investments are appropriate at this time in our life?
  • Where can we get help with our financial/investment decisions?
  • How can we select a financial professional (i.e. broker, investment advisor, financial planner) that’s right for us?

For more help discussing financial matters with your significant other, we encourage you to check out our Money Skills for Newlyweds guide


Conversations for Parents and Kids - Help your children build good money habits by talking with them early and often about finances and by setting a good financial example. Educational games and resources for youth can help get your children thinking and talking about personal finance. Use the questions below to jump start a conversation with your child about responsible money management. 

Budgeting

  • What is the difference between a need and a want? Which is more important?
  • How does our family make decisions about spending and saving?
  • Why is it important to balance income (money coming in) with expenses (money going out)?
  • What are ways to earn more money (i.e. babysitting, lawn mowing)?

Saving

  • What are some ways to save money?
  • How can interest help make your savings grow?
  • Is there something special you want to save for?
  • What are some ways to save for a long-term goal like buying a car or going to college?

Investing

  • What is an investment and how does it work?
  • How can investing make your money grow?
  • What are some of the risks of investing?
  • What are some ways to make investing less risky?
  • Where can you get advice and information about investing?

There’s an argument to be made for parents telling children how much money they make. The New York Times reported on one man’s hands-on budgeting lesson. He withdrew his entire month’s salary in $1 bills, dumped the cash on a table in front of his children, and spent the next few hours explaining where all of that money goes. 


Conversations for Retirees and Senior Citizens - Once you leave the workforce, it’s important to talk with your loved ones about how to ensure that you retain your financial security and independence throughout your retirement. Ask yourself, your partner or your adult children these questions to help you re-evaluate your financial plan in retirement.

Budgeting

  • Are projections for our retirement needs accurate?
  • Will we be able to enjoy the lifestyle we want (i.e. travel or recreational activities)?
  • Have we planned for unforeseen expenses due to inflation and medical expenses?
  • Could we downsize to reduce living expenses?
  • Have we made arrangements for someone to manage our finances if our health should decline?

Saving

  • Have we planned for rising health care costs?
  • Does someone we trust have copies of our estate planning documents and accounts information?
  • Do we have an emergency fund for unexpected financial hardships?
  • Who can we seek advice from to leave an inheritance?
  • Do we know all commissions, penalties, taxes and fees for withdrawing or rolling over retirement funds?

Investing

  • Who manages our investments and gives us investment advice?
  • Does our mix of investments match the level of risk we want at this stage of life?
  • Do we understand the risk and benefits of financial products promoted to senior investors, such as reverse mortgages, variable annuities or life settlements?
  • Do we know all commissions, penalties, taxes and fees for withdrawing or rolling over our retirement funds?
  • Who will handle our investments if our health starts to decline?

There’s another important conversation to have with aging loved ones. It’s crucial that you discuss fraud. It’s everywhere, and senior citizens are a favorite target. Many people fear this topic, because they think it will upset the seniors in their life. To ease your mind, here are some conversational queues flowing right along with “can you pass the turkey,” to ease into talking about protecting their pockets.

  • Now Versus Then - “Back in my day” and “when I was your age” are two common sayings spoken by aging generations. Most parents and grandparents love to tell stories about how they had to “walk 20 miles, uphill, both ways, in the snow.”  Use this to your advantage. Ask them why and how they interpret things have changed. This is a great way to lead into discussing technology and the evolution of scams.
  • Vet yourself - Remember the first time you typed your own name into Google? You were probably amazed at the amount of information returned through your search.  Be sure to ask your loved ones if they have tried this.  If not, grab a device and do this together. This will help them observe “straight from the horse’s mouth” how much personal information is online and available at one click. Feel free to throw in a “wow, look how easy it is for fraudsters to access this information” or similar comment.
  • Add Credibility - By visiting valid alert websites with your aging loved ones, such as Federal Trade Commission and the IRS, you are able to share valuable information with your loved one without seeming pushy or overly dramatic. These sources also have Facebook and Twitter accounts for followers to receive fraud alerts automatically. Additionally, it can help to watch the news together when reports about fraud are discussed.  Our Indiana MoneyWise website also provides ways to spot fraud and avoid becoming a victim.
  • Talk with them, not at them - Most of us pride ourselves on our independence. Engaging in conversation and open discussion rather than telling your loved ones what to do, goes along way.  Remember your parents and grandparents probably have a contrasting viewpoint on scams and fraud.  Back in the day, they didn’t have to lock their doors, and a handshake sealed the deal.  Although times have changed, the mindset still exists. Their trusting nature, accessibility, and polite manners make them tempting targets for con artists. When talking with them, encourage an attitude of empowerment. Discuss ways they can protect themselves.  By arming them with information, you’ll help your aging loved ones avoid fraud and establish yourself as someone they can come to when problems arise. For more information about aging family members and caregiving visit AgingCare.com.

Blog topics: 
Budgeting, Investing

Holiday Scams to Avoid

Holiday Scams to Avoid

 

By Kylee Hale

Wednesday, November 13, 2019

We are only 41 days away from Christmas. Some of us have started our shopping and others will procrastinate until the eve before. No matter how you do your gift giving, you might be surprised to learn that older peoplMillennials fraud holidaye are not the most susceptible to falling for scams. While elders tend to lose more money, younger people are more frequently victims. 

In a recent Consumer Protection Data Spotlight by the Federal Trade Commission (FTC), research shows that 20 and 30 year olds (aka millennials), are 25% more likely to report a loss of money via fraud than people in their 40s and older. The #1 type of fraud loss reported by millennials is online shopping, followed by fraud of business imposters, government imposters, fake check scams and romance scams. 

Scammers prey on consumers’ emotions and desires. They will take advantage of any opportunity, especially the season of giving. The holidays are a prime time for con artists to try to get ahold of your personal information and rob you of your holiday spirit. Don’t let a scammer steal your jingle, be on the lookout for these popular scams. 


Imitation sites – The amount of retailer marketing emails we receive during the holiday season seems to be triple compared to the rest of the year. Scammers are responsible for some of our inbox overload as they send out illegitimate emails made to look like the real ones that retailers produce. These replicated emails could contain malicious links built by scammers to gather your credit card information or ruin your machine by installing a virus. For example, consumers visiting wa1mart.com may mistakenly think that they're on the real Walmart website. In reality, the L in the URL was replaced by the number one -- and the site is fraudulent.

Similar to emails, fraudsters also target the younger generations through social media ads. Be cautious of social media promotions, if a deal sounds too good to be true, it probably is. Many of the shopping-related fraud experiences reported to the FTC were about items that were never delivered or weren’t as advertised.

To check links for legitimacy, hover over the link in an email or on social media to see where the link directs you. Check that the URL includes https: identifying that it is a secure page and be sure to avoid purchasing items on a site you have never heard of. Review emails and ads for typos and other mistakes that could indicate it’s inauthentic. When in doubt, your safest route is to directly search a website by typing in the web address yourself via a new browser window. 


Phony attempted delivery notifications – After you place an online order, your eager recipient excitement sets in, and con artists know this too. Similar to the imitation marketing emails and social media posts, scammers also send fake shipping notifications to try to get you to click their copycat links. The email might say your shipment is on the way but you need to update your delivery preferences. By following the link you risk downloading a keystroke virus that could track your keypad activity and compromise your credit card and personal information.  

Would you believe there is a low-tech version of this scam? Scammers try to pull a fast one by putting a note on your door or mailbox similar to the redelivery notifications that come from UPS and Fedex. However, the phone number provided goes to a fraudster who will try to get your bank account information. 

This seems like a fitting time to also mention keeping your packages out of the hands of “porch pirates”. Your online orders are just as susceptible to standard theft. Nearly 26 million Americans reported their holiday packages stolen last year, including this guy in the USA Today article, whose package contents were removed from the box within 5 minutes of Amazon’s delivery. 


Fake Charities - Holiday time is a common time of year for people to feel generous and to give to charities. If you donate you are likely aware of the tax benefits which may be your motive. Charities know this and typically reach out during this time, but so do scammers. 

With the increased request for donations, be sure to double check the authenticity of the charity. The Better Business Bureau’s Wise Giving Alliance (Give.org) is a great resource offering reports and ratings on how organizations spend donations and conduct business, you don’t want to give to a fake cause or end up funding someone’s personal gain. 


Virtual Gift Exchange – A scam that is recycled year after year, but continues to get new victims. Watch out for this seasonal pyramid scheme on Facebook, Instagram and Twitter. The scam begins when a friend posts about inviting you to a gift exchange, often it’s titled Secret Sister Gift Exchange. It’s advertised that if you buy a gift valued at $10 and send it to one person, you will in return receive 36 gifts in the mail. Not only does this seem too good to be true, it’s actually illegal. According to the Better Business Bureau, any chain letter of this kind is considered illegal gambling by the United States Postal Service, and that includes postal mail, email and social media. 

 

The holiday season brings out a lot of cheer and goodwill, but it’s also a time when scammers see more opportunity to prowl for easy victims. Stay alert and don’t risk being separated from your hard earned money. Recognizing when deals are unrealistic and paying close attention to links and phony websites will help protect you.  


Blog topics:
Fraud Prevention

5 Tips for Celebrating Veterans Day

5 Tips for Celebrating Veterans Day

 

By Kylee Hale

Wednesday, November 6, 2019

If you’re like me, you recognize Veterans Day as a holiday in November, which means you don’t have to come to work. This is a great benefit even to those of us who are not veterans. While we are enjoying time away from our cubicles, here are a few tips to make sure you truly know what this day is all about.

#1 Veterans Day and Memorial Day are not the same.

I will admit, I did not know the difference, except that one is in May and one in November. But, I know I am not alone due to the number of articles written to explain the differences between these two holidays. According to Military.com, Memorial Day is for reflecting, remembering and honoring. In other words, Memorial Day is a way of appreciating those who gave their lives for our country, while Veterans Day honors all who have served – dead or alive – yet it seems to mostly be intended to thank living veterans for their service.

#2 “The end of all wars”

Veterans Days was originally Armistice Day, named for the end of the fighting of World War I. On the eleventh hour, of the eleventh day of the eleventh month of 1919, the Allies and Germany put into effect an armistice or a truce. Congress did not establish this day as a holiday until 1938, and then World War II happened and the Korean War. In 1954, congress changed the holiday to “veterans” day to honor all American war vets.

#3 Veterans Day, not Veteran’s Day.

Just like Daylight Saving Time is commonly misspelled with an added “s” to be Daylight Savings Time, Veterans Day often gets an apostrophe added which does not belong. There is no possession of Veterans Day, just plural, as is celebrating all veterans as a group.

#4 Always on November 11th

From 1971 to 1977, Veterans Day was observed on the fourth Monday in October. This was part of the Uniform Holiday Bill, which pinned down a few federal holidays to be celebrated on a Monday. Officials hoped this would stimulate the economy with travel and family activities over the long weekends. Americans did not like Veterans Day being celebrated this way. In 1978, President Ford signed a bill that return Veterans Day to November 11th. Ever since, we have always observed this holiday on November 11th and sometimes we get lucky enough that it falls on a day next to the weekend. 

#5 Celebrate HomecomingMilitary Homecoming

Civilian life can be very different than time spent while on active duty. For those transitioning their way into life at home with family and friends, there are many resources to help. Some challenges include obtaining a job, repaying debt, going back to school and preparing for financial emergencies. The links to several assistance resources are listed below:

Veteran Jobs: Military.com, USAJobs
Continued Education: GI Bill 
Hardship Support: USA Cares, The American Legion, Operation First Response, Coalition to Salute America’s Heroes and Disable American Veterans


Blog topics:
Credit

October 2019 Posts

Bitcoin and Beyond: What Do You Know About Crypto?

Bitcoin and Beyond: What Do You Know About Crypto?

 

By Kelly Griese

Wednesday, October 30, 2019

Bitcoin This week marks the 11th anniversary of Bitcoin. It’s one of the most talked about brand names in the fintech world, and for many people, it’s as synonymous with cryptocurrency. Think using Coke in place of soda, Kleenex in place of facial tissue, Chapstick in place of lip balm. There are even terms to define this phenomenon: genericized trademark or proprietary eponym. Essentially, the brand name becomes the common name we use to describe all similar products. In the case of Bitcoin, we often use it in place cryptocurrency, even though there are more than 2,900 different cryptocurrencies in existence. 

 

So what is cryptocurrency anBitcoind how does it apply to investing? 

First, let’s define cryptocurrencies with some help from the North American Securities Administrators Association, or NASAA

“Cryptocurrencies are digital assets created by companies or individuals that take the form of a virtual coin or token. Anyone can create a cryptocurrency. Cryptocurrencies are intangible and exist only on the internet. Central banks and other governmental authorities do not insure or control cryptocurrencies. You cannot always exchange them for other fiat currencies (i.e., currencies declared “legal tender” by governments), such as the U.S. or Canadian dollar or Mexican peso. Cryptocurrencies trade on unregulated, opaque exchanges on which there may be little or no opportunity to independently verify their true market value. And given the newness and uniqueness of cryptocurrencies and related instruments, they do not yet have a clear place in the existing framework of financial regulation.”

BitcoinFor some investors, the decentralized, unregulated nature of cryptocurrencies makes them MORE appealing, and fraudsters agree.

Fraudsters all too eager to exploit investors’ interest in the crypto craze. Here are some common schemes associated with cryptocurrencies: 

Fake digital wallets – A digital wallet is used to store, send, and receive cryptocurrencies. Scammers design a fake digital wallet to lure users into providing their private key or code that enables the wallet to open. Once a scammer receives the private key, he or she can steal all the cryptocurrency from the owner’s digital wallet.

Pump-and-dumps – Groups of individuals coordinate to buy a thinly-traded cryptocurrency, promote the cryptocurrency on social media to push up demand and price, and then sell it in a coordinated sale. The price plummets and those unaware of the scheme are left with the devalued cryptocurrency. 

Multi-level marketing platforms – Companies lure investors through the promise of high interest with low risk. These investors are then incentivized to recruit more members. 

In an effort to combat cryptocurrency scams, the Indiana Securities Division joined forces with NASAA to investigate Initial Coin Offerings (ICOs) and cryptocurrency-related investment products. “Operation Cryptosweep” involves more than 40 NASAA members, including the Indiana Securities Division.  To date, the operation has resulted in more than 330 inquiries and investigations and at least 85 enforcement actions. As part of the the sweep, the Indiana Securities Division filed a cease and desist order against Bionic for registration violations.

Bitcoin

Before investing in crypto-related products, here are some common concerns you should consider: 

Volatility - Cryptocurrency markets are highly volatile, making them unsuitable for most investors looking to meet long-term savings or retirement goals. To understand this volatility, just look to the Bitcoin crash of 2018. It was valued at $6,447 on October 31, 2017 before spiking to an all-time high of $19,068 on December 17, 2017 and returning to $6,283 as of October 30, 2018. Other cryptocurrencies experienced similar volatility.

No recourse - Cryptocurrency and many crypto-related investments are subject to minimal regulatory oversight, and there may be no recourse should the cryptocurrency disappear due to a cybersecurity breach or hack.

Untraceable - Cryptocurrency or crypto-related investments only exist on the internet. Issuers can be located anywhere in the world, so it may be impossible to trace and recover lost funds through the courts.

Uninsured - Cryptocurrency accounts are not insured by the Federal Deposit Insurance Corporation, or FDIC. 

Unregulated - Cryptocurrency investors rely upon unregulated exchanges that may lack appropriate internal controls, making them susceptible to fraud, theft and hacking.

Hackable - Creating a digital wallet to store cryptocurrency involves installing software on an investor’s computer. As with any software download, hackers may include malicious code.

Vulnerable - Purchasers of cryptocurrencies rely on the strength of their own computer systems as well as systems provided by third parties to protect purchased cryptocurrencies from theft.

Last year, ahead of the 10th anniversary of Bitcoin, the Securities Division of the Indiana Secretary of State’s office released an investor advisory on the subject of cryptocurrencies. You can read it here.  Additionally, NASAA created a short, animated video to help investors better understand cryptocurrency-related investing and the risks involved. You can view the video here


Blog topics: 
Fraud Prevention

How to Start Investing

How to Start Investing

 

By Kylee Hale

Wednesday, October 23, 2019

Young adults today face one of the most uncertain economic futures of any generation since the Great Depression. Specifically for us Millennials, born in the 80’s and early 90’s, most of us came of age and entered the workforce during the Great Recession. As a result some of us started careers with lower salaries than desired or not in our preferred field of work. Fuse this with the amount of debt we carry in the form of school loans, and it’s easy to see why some (not all) of us might be nervous about putting our hard earned money into an investment option that carries any degree of risk. Aside from questioning how to begin investing, you may be wondering when to begin. Let's address that first.
 

If you remember any of the following, you need to be investing for your future:

Oregon Trail when Facebook required a college email address.N*Sync & Limp Bizkit.Total Request LiveBeanie BabiesBlockbuster VideoAIM AOL instant messengerMixed CDsFloppy DisksNETFLIX DVDs VIA MAILDial-up InternetTwilight

Hopefully, you have deduced that you should start investing today. Not investing while time is on your side could make for a difficult road to retirement. But many times, we run away from things that seem challenging or when we don't know where the starting line is. Investing can seem overwhelming and full of uncertain outcomes, yet most of these emotions are built up by myths or fictional roadblocks. Here are the top three myths you need to stop believing about investing and the encouragement you need to get going. 

3 Investing myths you should ignore

Myth 1: I don’t have enough money to start investing.
“The journey of a thousand miles begins with a single step.” - Lao Tsu, Chinese Philosopher

Can you put aside $5 a week? $10 a week? Then congratulations! You have enough money to start investing for your future goals, whether that includes a home, wedding, or more flexible lifestyle. You might be able to find even more to invest by taking a look at your budget. (Don’t have a budget? Check out our free budgeting worksheet and instruction guide here.) You can make this choice effortless with automatic deductions. If you’re paid bi-weekly and have $20 taken out from your paycheck before it hits your bank account, you’ll have over $500 to invest over the course of the year, and you won’t miss it because you won’t see it.

Many brokerage firms and trading platforms offer no minimum deposit required investment options, just be sure to check the commissions or management fees. Many young adults are curious about investing apps, you can check out some guidelines for using smart phone investing apps here. Remember, before placing your money with any broker-dealer, to make sure they are registered by checking the Indiana Securities Portal.

Myth 2: I don’t know enough about investing – I have no idea which stock to pick.
“You don’t need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ.” - Warren Buffett

You don’t have to pick stocks if you don’t feel comfortable researching the financial health and history of individual companies. There are many investment products that enable you to invest in broad sectors of the market for not much cost at all. These products allow you to diversify and spread your risk out over several different companies and economic sectors, rather than putting all your money in one company’s stock. If you need help building a portfolio, you can also enlist the assistance of a robo-adviser or consult a registered financial professional. Many financial planners, investment advisers, and brokers are willing to work with clients who are just starting out on their investing journey and may not have accumulated many investable assets yet. In a way, time is on the financial professional’s side by working with younger clients whose investments will enjoy the benefit of compounding value over time.

Start educating yourself by using Google or check out our Investing 101 page for educational materials on investing. You may also start by researching lower cost financial professionals in your area or who are willing to work with you remotely on your investment goals. For more information, see this overview of the different types of financial professionals.

Myth 3: I’m afraid of losing all my money.
“When you invest, you are buying a day that you don’t have to work.” - Aya Laraya

It's undeniable how scary it was when the US stock market lost half of its value in 2008. However, that’s not the end of the story – by 2012, the market was back on track and trending upward. How many millionaires can you name that became wealthy by investing in savings accounts? The answer to that question is likely, none. While there is always a risk of losing money when investing, leaving your money in a savings account is almost a guarantee that you will lose some of the value of your money to inflation.

Take a look at the data on market performance over the long term (10, 20, and 30 years), while there are fluctuations, in general, the market has trended up over the long term. Don’t get hung up on social media trends or 24-hour news shows. It’s important not to make your investment decisions based on sources that offer dramatized information on the latest market dip or the hottest new IPO. 

I can't say it enough, right now time is on your side, but with each day that passes, it’s a little less on your side.


Through my membership with the North American Securities Administration Association (NASAA), Alerts and Advisories project group, we created NASAA's Millennial Money Mission. For more investor insights and advisories visit NASAA.org


Blog topics: 
Investing

Scary Spending: Halloween by the Numbers

Scary Spending: Halloween by the Numbers

 

By Kelly Griese

Wednesday, October 16, 2019

We spend a scary amount of money on Halloween. Americans in particular love the holiday and can’t seem to get enough of the candy, decorations, and costumes that have come to define October 31st (and the month or so before it). The National Retail Federation, or NRF, has been conducting a survey of Halloween since 2003 to see how Americans celebrate this spooky holiday. This year, shoppers say they will spend an average of $86.27 per household. That means Halloween spending in 2019 is expected to reach $8.8 billion (that’s down from 2018’s projected spending of $9 billion).  

So where’s the money go? The bulk of the money, $3.2 billion, is expected to be spent on costumes. 47% of consumers say they plan to dress in costumes – and 17%, or 29 million people, say they will buy costumes for their pets as well. It seems social media, Instagram in particular, could be driving the pet costume trend. According to the NRF, the most popular pet costumes include pumpkins, hot dogs, superheroes, bumblebees, devils, and sharks. 

Decorations are the second biggest spending category, with consumers expected to spend $2.7 billion making their homes look seasonally spooky. 49% of folks say they plan to decorate their homes for the Halloween holiday. Then there’s the candy. Consumers are expected to spend $2.6 billion on sweets for themselves and trick-or-treaters. 69% of shoppers say they will hand out candy this year. 

Despite our love of Halloween spending, we still can’t say no to a good deal. Most Halloween shoppers (47 percent) get their goodies at discount stores. 38 percent visit specialty Halloween stores, and 25 percent shop at grocery stores. 
     
To learn more about Halloween spending, check out the NRF’s report. And if you're trying to get control over your spending, consider creating a budget. We can help you. Check out the Basics of Budgeting page of the Indiana MoneyWise website. You'll find it under Personal Finance 101


Blog topics:
Budgeting

Investing via Smartphone Apps

Investing via Smartphone Apps

 

By Kylee Hale

Wednesday, October 9, 2019

Smartphones offer easy and instant access to apps that can help you navigate the complex world of investing. However, the variety of financial apps offered to investors can be daunting, especially if you are new to investing. This information will help you understand some options when investing via smartphone apps and highlight things to consider before committing to app-based investing.

investing app

 

Thinking of using a smartphone app for investing?

You may already use smartphone apps to do your banking, make purchases, transfer money to your friends, or find deals on products and services. With so much of your financial life tied to your phone, it makes sense that you might also consider an app (or two) to help you invest. Since investing can help you reach short- and long-term financial goals, there are many things to consider when choosing an investment-focused app.

 


What kinds of apps are available?

Financial services companies that offer smartphone apps take various approaches to help people invest their money and monitor their portfolios. These apps range in focus and cost. Here are some examples: 
 
  • Buying and selling investments: Trade stocks, bonds, and other investment products.
 
  • Turning daily spending into investing: “Round-up” your daily purchases and take the “spare change” to automatically buy investments for a predetermined portfolio.
 
  • Investing through automatic allocation: Direct a certain percentage of your income to an investment or retirement account.
 
  • Assigning a portion of spending to invest: Monitor your spending and saving habits and assign a percentage of your overall spending to an investment account.
 

How can using investing apps be helpful?

Investing is a life-long pursuit that can help you meet your financial goals. If you’re just getting started, an app may help you take more control of your finances or better understand the investing world. For example, if you have trouble making yourself save money to invest, you may favor an app that does it for you. However, once you build a small investment portfolio, you should reevaluate if you still need the app and if there are better options for you. This should become a habit as your needs and expectations change.

How can investing apps be problematic?

Smartphone apps give instant access to trading and portfolio management services, with market access at your fingertips. If you are fairly new to investing, jumping right into trading stocks, bonds, and other complex financial products may not be in your best interest. For example, if you are an emotional person who is swayed by market gyrations, you may end up buying investments at high prices and selling at low prices. Even if you are paying low, or no, trading fees, frequent buying and selling can cost you in the long run. You may also end up with a portfolio that isn’t balanced or diversified. 

Things to think about when using investing apps:

  • Investing on autopilot: Putting an investment portfolio on cruise control may be attractive to people who think investing is difficult and complex. However, if you don’t pay attention to your investments or the services you are using, you may not be happy in the long run. Also, if you use several different apps, you risk over-complicating your finances. 

 

  • Cyber and data security: Read the terms of service and understand how the company will protect your financial data. With any online application, there’s a risk of being hacked. Check consumer reviews and internet searches for information about any data breach the app may have experienced.  

 

  • Customer service and access: If you have an issue with your account or the app, you’ll want to be sure that you have access to someone (a live human!) who can help you fix the problem. Be sure you are comfortable with the level of service the app provides, and read customer reviews. 

 

  • Fees: People are attracted to these types of services because they offer low-fee alternatives to traditional financial service firms. Being fee conscious is good, but a lower fee structure could mean less service and information. Read the fine print to determine what the total fees are for an account. Over time, these add up and impact your overall returns. 

 

  • Investment offerings: If the app is allocating money to investments for you, understand the investment products and track record of the investment management firm overseeing the products. You want to be comfortable with the types of investments an app is putting you into, the risk you are taking, and the fees being charged. 

 


What can I do to avoid possible pitfalls of using financial services apps?

Be cautious, do your research and stay engaged.

Don’t use a smartphone app just because a friend suggests it to you. If you are new to investing, you may find yourself using an app that isn’t suitable for your needs or is fraudulent. Technology can make your investing life easier, but you should monitor and check in on your portfolio regularly. Being an informed investor will help you build the skills and knowledge you need to meet your long-term financial goals.


Your takeaway

Technology is rapidly changing the way we invest and manage our finances. When using online services or apps, be sure to use smartphone apps that you understand and fit your financial needs. 

Through my membership with the North American Securities Administration Association (NASAA), Alerts and Advisories project group, we created NASAA's Millennial Money Mission. For more investor insights and advisories visit NASAA.org


Blog topics:
Investing, Fraud Prevnetion

Free Classroom Programming

Free Classroom Programming

 

By Kelly Griese

Wednesday, October 2, 2019

School is back in session, and the holidays aren’t far away. It’s safe to say teachers are BUSY! And so are our Indiana MoneyWise education coordinators. This time of year, we receive dozens of invitations from Indiana teachers interested in inviting us to their classrooms to speak to students about personal finance and fraud prevention. So in celebration of World Teachers' Day on October 5, we offer you an overview of some of the FREE programming options available to all Indiana teachers. 

Pet $ense Magical Creatures – This is a game that teaches children some of the basics of budgeting using magical creatures from the world of Harry Potter. Children adopt imaginary pets and use an assigned allowance to make purchasing decisions for pet supplies. We throw in an emergency expense, and children will be face with the dilemma of whether they have enough money remaining to afford a class trip to Hogsmeade. 

  • Suggested Time: 15-45 minutes (depending on group size, math skills, and the amount of discussion that takes place)
  • Content: budgeting, credit, debt, emergency expenses
  • Recommended Ages: grade school
  • Ideal Audience Size: any size

Avengers Saving the Day – Connecting with kids using comic books! We use a special edition “Avengers” comic book, created by Marvel Comics in partnership with Visa’s Practical Money Skills to teach children basic financial concepts. Children receive a free piggy bank and comic book (while supplies last). 

  • Suggested Time: 45-60 minutes (more time is needed for larger groups)
  • Content: currency, budgeting, saving, banking, and more!
  • Recommend Ages: grades 2-7
  • Ideal Audience Size: any size

Fraud Fighting Force – Children love escape rooms, and we have created a simulation that uses many of the best parts, such as locks and secret codes. Children are told they have a chance to join a superhero team known as the Fraud Fighting Force, but they must first prove their worth by passing a series of tests. In the process of playing, children learn how to spot the red flags of fraud so they can avoid becoming victims of a financial scam. 

  • Suggested Time: 15-30 minutes (depending on ages and group size)
  • Content: financial fraud prevention
  • Recommended Ages: 5th grade and older
  • Ideal Audience Size: participants should be divided into teams if there is a large audience (4-5 per team)

Financial Football – This is a game that’s available online, but can be fun to play in teams. The fast-paced, interactive game is competitive and helps students learn money management skills. Teams compete to answer finance questions to gain yardage and score touchdowns. 

  • Suggested Time: 45 minutes
  • Content: general financial fitness
  • Recommended Ages: there are three versions, 11-14, 14-18, 18+
  • Ideal Audience Size: 20 or fewer (teams are recommended)

How to Avoid Getting $CAMMED – This $CAMMED presentation is our most popular program. It provides students with the perfect introduction to various types of financial fraud and exploitation. Teens learn about the IRS scam, the grandparent scam, the tech support scam, Ponzi schemes, and identity theft. The presentation includes videos featuring interviews with real criminals and victims. Teenagers learn about methods of persuasion used by fraudsters and are taught how to protect themselves. 

  • Suggested Time: 45-60 minutes (60 is ideal to allow for more questions)
  • Content: fraud and scams
  • Recommended Ages: high school
  • Ideal Audience Size: any size

Adulting 101 – Reality bites! In this presentation, we examine typical “adulting” activities such as budgeting, paying off debt, investing, improving your credit, buying a car, and paying for school. This is a more intensive workshop that is best presented over a course of multiple sessions, or you can pick a few topics for us to cover with your students. 

  • Suggested Time: 3-4 hours total (can be spread over the course of several days)
  • Content: values, goals, budgeting, saving money, investing, credit reports, credit scores, buying a car, paying for school
  • Recommended Ages: high school students (juniors and seniors especially) 
  • Ideal Audience Size: 20-40 students

If you’d like to invite one of our education coordinators to visit your school, please send an email with the following information:

  • Teacher name, email address, and phone number
  • School name and address
  • Proposed dates and times 
  • Student grade level
  • Topics you’d like us to cover
  • Number of class periods you’d like to join

You can email me, Kelly Griese, at kgriese@sos.in.gov. Or you can email my coworker, Kylee Hale, at kyhale@sos.in.gov. All of our programs are customizable to fit your needs, and we are able to bring our own presenting equipment if necessary. And, yes, we really do travel the ENTIRE state of Indiana. All of our programming is available for free for use in classrooms and out-of-school programs. 


Blog topics:
Fraud Prevention, Budgeting

September 2019 Posts

The Truth About October Investing

The Truth About October Investing

 

By Kylee Hale

Wednesday, September 25, 2019

Is October the month of market crashes? AccoStocks Crash October Effectrding to lnvestopedia.com, the October effect is the theory that stocks tend to decline specifically during this month. This theory is supported by multiple historic market crashes. For example: on October 19, 1987, the Dow fell 22.6%, one of the largest single-day drops in market history. This day has been coined as Black Monday. Other examples include: Thursday, October 24, 1929 (Black Thursday) when the Dow dropped 11% and Tuesday, October 29 (Black Tuesday), which marked the beginning of the Great Depression.  Are these historic crashes anything more than coincidence? What should you look for in October?

-  There’s no evidence that the previous major market crashes were connected. The statistics show more historical down markets have occurred in September than October

-  Previous market slides in the years 1987, 1990, 2001, and 2002 turned around before October was over. 

-  Despite the 1987 plummet, Black Monday has been one of the best buying opportunities of the last 50 years. 

-  The psychological expectation of the October effect combined with skittish investors is a recipe for a self-fulfilling prophecy. Evidence suggests than more often than not, you’ll make money in October. 

-  October may get a bad rap for the significant historic drops, but it’s important to remember that market downfalls don't cluster. As convenient as it would be for all financial collapses to occur in just one month, October is no more susceptible to downfalls than the other 11 months.

-  If October isn’t the worst month, which is? September has more historical down markets and was the instigator for the crash in 1929. 

The stock market is not easy to predict. But one thing you can rely on is that after every crash, the market will eventually go back up. Here are some parting words regarding the October Effect. 

  • Don’t get caught up in worrying over one month, think long term. If you’re investing in the short term, be conservative, lighter on stock investments and only invest what you are willing to lose.
  • If you sell in October, you could be missing out on big gains. December is typically a good month for the market. 
  • Be sure to diversify as past performance doesn’t always indicate future returns.
  • Spread your money around and combine investments in multiple sectors to alleviate risk. 
  • Exploit the fear, if other investors are selling off during October, be sure to look for deals. 

As with all investments, careful vetting and due diligence is a must. Call our office at 1-800-223-8791 or search the Securities Portal to check if both the professional and securities products being offered are registered.


Blog topics:
Investing

5 Reasons Why Your Budget Isn't Working

5 Reasons Why Your Budget Isn't Working

 

By Kelly Griese

Wednesday, September 18, 2019

First things first… why do we budget? For many people, budgeting is a scary word. For some of those people, the idea of doing math is the scariest part. But budgeting is less about math and more about record keeping and self-control. The basics of budgeting are easy. 

Simply put, a budget is a plan for your money. It’s a document of money coming in and money going out. Keeping track of your money’s movement can help you avoid spending more than you earn. It can also help you plan for long- and short-term goals. Sometimes it can be hard to plan ahead, but doing so now can help you avoid the horrible feeling of NOT being able to make ends meet. 

If you have never budgeted before, a good way to start the process is by printing our free budgeting worksheet and instruction guide. You can find the PDF here

If you’re struggling with budgeting, take a look at some of the common problems below. 

 

1) You left zero room for error. 

A lack of flexibility in your budget, especially when you first begin, is sure to lead to problems. Those problems can include emergencies. If your budget doesn’t include contributions to an emergency fund, make that change immediately! Once you solve that problem, add a little wiggle room to some other categories of your budget. Expenses tend to rise and fall, and your budget needs to be able to roll with the punches. IF you spend less than normal one month, put the surplus into savings. It will come in handy the next time you go a little over budget.

2) You haven’t clearly defined your goals.

Without goals, how can you possibly hope to prioritize your spending? Most budgets require some degree of sacrifice. Figure out what it is you want to accomplish with your money and work toward those goals. The rest of your expenses will likely need some trimming. If saving for higher education is a must, how much do you really need to spend on entertainment? If your career aspirations require you to be up-to-speed on current events, maybe you do need cable, internet, and a daily newspaper, but do you also need to dine out for lunch every day of the week? Probably not.

3) You forgot you have a personality. 

Are you a saver? Are you a spender? Your budget is unique. That’s why you can’t simply copy someone else’s. It should match your personality and lifestyle, as well as your goals. If you are the sort of person who enjoys shopping and has a casual attitude about money, then be sure to build a cushion into your discretionary spending category. If your budget includes other people, such as a spouse and children, you’ll need to take into account all of their personalities as well.

4) You aren’t being honest with yourself.

Once you commit to budgeting, you absolutely must keep track of every cent you spend… especially in the beginning. Until you have a realistic picture of your spending habits, you won’t know how much of your income should be devoted to each budget category. The place where most people slip up is with their “discretionary” spending. You probably have your rent or mortgage payment memorized down to the last penny. It’s likely our biggest bill each month, and paying it is required. But what about all those little purchases you make each day? A morning coffee, an afternoon snack, a trip to the movies with friends, or an impulse purchase on Amazon. Discretionary spending accounts for all the stuff you don’t need. It also accounts for all the stuff you are LIKELY to buy.  Be honest with yourself. Keep good records of your spending the first few months you budget. It will help you identify problem areas and work to correct them. You can print a copy of our spending log to begin the process. The spending log can be found here

5) You didn’t pay yourself first.

Saving for the future is an essential part of every budget. This can be hard when you’re barely making ends meet. It requires discipline. It also requires you to think beyond your need for immediate gratification. We crave the “high of the buy.” Spending money now can make us feel good in the short term, but in a few years, when we really want something big, the money won’t be there. If you’re still working when you’re in your 80s, you’ll regret not paying yourself first. Set aside room in your budget for saving and investing, no matter how small, and work on growing that category over time. 

Be sure to check out the Personal Finance 101 section of the Indiana MoneyWise website to learn more about budgeting. There you will also find information about credit cards, debt management, retirement planning, investing, and more. 


Blog topics:
Budgeting

The Best Way to Save for Higher Education

The Best Way to Save for Higher Education

 

By Kylee Hale

Wednesday, September 11, 2019

The Best Way to Save for Higher Education 9.11.19 postWhether you’re a parent or you yourself are looking to obtain a degree it's easy to get sticker shock from reviewing education costs. With a price tag that's constantly rising, it may seem impossible to pay upfront or even someday pay off financial aid loans. Future students should apply for scholarships, grants and even consider schools with lower tuition fees. But two things ring true in nearly every situation - it's never too early or too late to start, and a dollar saved now is better than one borrowed later. With this, I want to bring light to the beauty of Indiana’s 529 Plans, which might just be your best friend in paying for higher education.  

Named for Section 529 of the federal tax code, 529 Plans are to post-high school education as 401(k)s and similar options are to retirement. 

Earnings on 529 investments are tax-deferred, and become tax-free when used to pay for qualified higher education expenses.

Indiana offers one of the most generous up-front tax incentives for 529 contributors, Hoosiers can get a 20% credit worth up to $1,000. This credit is available to each taxpayer that contributes, even better, the credit is available to account owners and third­party gift contributors, meaning parents, grandparents and others can all pitch in and reap some of the benefits.

529s are also incredibly flexible. Qualified expenses include tuition, room and board, books, fees or computers at any school that's eligible to receive federal financial aid. Whether your child wants to become a doctor or a skilled tradesperson, 529 savings can be used to help them pursue their goals. But one thing to note, is that 529 savings cannot be used to pay off student loans, so it’s better to save up before and take advantage of the tax benefits. 

Perhaps most importantly, 529 Plans are affordable and easy to use, with a variety of investment options and strategies to meet savers' needs.

Here in Indiana, the CollegeChoice 529 program consists of three different Plans:

CollegeChoice Direct CollegeChoice Advisor CollegeChoice CD
The Direct Plan features quick online account setup and a low minimum contribution of $10. The Year of Enrollment portfolios are set to automatically grow more conservative as a beneficiary gets older. The Advisor Plan offers access to a wider variety of investment options. As with any financial service involving professional assistance, the Advisor Plan comes with slightly higher fees. The CD Plan resembles a traditional bank product in that it offers principal protection. Its streamlined lineup of FDIC-insured options includes one-, two­and three-year fixed rate certificates of deposit (CDs) and a savings account.

All three of these 529 Plans share the same core benefits mentioned above - and all three represent a meaningful investment in a child's future. 

The cost of higher education isn't going to suddenly plummet overnight, but when used properly, 529 Plans can help parents and all students prepare for the significant challenge of financing it.

For more information about the CollegeChoice 529 Direct Savings Plan, call 1.866.485.9415 or visit www.collegechoicedirect.com to obtain a Disclosure Booklet, which includes investment objectives, risks, charges, expenses, and other important information; read and consider it carefully before investing. 

For more information about the CollegeChoice Advisor 529 Savings Plan, contact your financial advisor, call 1.866.485.9413 or visit www.collegechoiceadvisor529.com to obtain a Disclosure Statement, which includes investment objectives, risks, charges, expenses, and other important information; read and consider it carefully before investing. 

For more information about the CollegeChoice CD 529 Savings Plan, call 1.888.913.2885 or visit www.collegechoicecd.com to obtain a Disclosure Statement. The Federal Deposit Insurance Corporation (FDIC) generally insures, with respect to each FDIC-insured institution, deposit accounts that are held in the same right and capacity up to the maximum amount set by federal law, currently $250,000. 

 

Please Note: before you invest, consider whether your or the beneficiary's home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in that state's qualified tuition program. You should also consult your financial, tax, or other advisor to learn more about how state-based benefits (or any limitations) would apply to your specific circumstances. You may also wish to contact directly your home state's 529 college savings plan(s), or any other 529 plan, to learn more about those plans' features, benefits, and limitations. Keep in mind that state-based benefits should be one of many appropriately weighted factors to be considered when making an investment decision.

The above is adapted from the Indiana MoneyWise e-magazine March 2018 as written by guest author Troy Montigney. Click here to download a PDF version of the full e-magazine.


Investing

How to Spot a Con Artist

How to Spot a Con Artist

 

By Kelly Griese

Wednesday, September 4, 2019

Con artists are pretty clever. They prey upon our emotions, hopes, dreams and fears. It is important to understand that they are very good at what they do. Duping people is what they do for a living. Here are some red flags that can help you spot a con artist and avoid falling victim.

  • The seller is not licensed or registered. You can easily check with the Office of the Indiana Secretary of State through our searchable databases on the Indiana Securities Division's website. Individuals and firms in the financial services industry must meet certain requirements. Taking time to research a seller and their investment offer could save you in the long run.
  • No written information is provided. Ask for a prospectus. It is a legal document that provides details about an investment offering. The prospectus or "offer document" will contain the facts you need to make an informed investment decision.
  • The seller refuses to take no for an answer. You should be suspicious of any seller who pressures you to "act now" or says this is a "limited time offer." If they’re pushing you to make a decision immediately, it is probably because they don’t want you to find out they are selling a scam.
  • The seller is hesitant to answer your questions. Con artists seem to have an answer for everything, but if your questions make them uncomfortable, it is best to walk away. Ponzi schemer Bernie Madoff once said he only turned people away when they asked too many questions. 
  • They promise high returns with low risk. Returns and risks go up and down together. There is no such thing as a "no risk" investment. All investing comes with some risk attached. 
  • You are asked to keep this "exclusive" offer a secret. Con artists do not want to be caught. Therefore, they pick their victims carefully. They do not want you telling someone who might uncover the scam.

Finally, trust your gut. Many victims report feeling uneasy about the decisions they were making. Just know that if an offer sounds too good to be true, it is!


Blog topic:
Fraud Prevention

August 2019 Posts

Interesting Facts I Bet You Never Knew About Millennial Investors

Interesting Facts I Bet You Never Knew About Millennial Investors

 

By Kylee Hale

Wednesday, August 28, 2019

The millennial generation has been plagued with the blame of killing almost everything. From napkins and cable TV to the real estate industry. Even though, millennials aren't buying starter homes as soon as they leave the nest these young adults stand out in their saving and investing manners.

DIY Generation

From building a bookshelf to starting a business, millennials are do-it-yourselfers. These adults know that more than likely they will be responsible for saving for their own retirement. More than half, feel that their main source of income during retirement will be from a 401k, IRA or similar savings account, the pension is dead.

Money isn't a Sensitive Subject

Because millennials feel more responsible for their retirement success they are openly discussing money plans with family and friends, well more openly than past generations. According to CNBC, 75% of millennial couples talk about money at least once a week, that's 9% more than Gen X couples and 31% more than baby boomer couples.

Millennials are on F.I.R.E.

F.I.R.E. stands for Financial Independence Retire Early, this is a financial movement defined by frugality, extreme saving and investing. Not all Millennials are living by the guidelines of this focus, however, Transamerica Retirement Survey shows that 58% of Millennials plan to be retired by age 65 or sooner, and while 69% of baby boomers say they expect to work past that age. Not only do millennials expect to retire earlier, but they also expect to live longer, making them the first generation to spend more time in retirement than time spent on the job.

Simplicity is Golden

Some millennials are investing, and they are selecting investments that are easier to understand. Some of the most popular investment vehicles for millennials include index mutual funds, exchange-traded funds and employer 401(k) target-date funds. Millennial investors are more interested in sustainable investing, investing in companies or funds that take into account social and environmental impact. According to Morgan Stanley, millennials are twice as likely, compared to the overall investor population, to invest in companies targeting social and environmental goals, and 90% of millennials say they want sustainable investing as an option in their 401(k) plans.

What's the Verdict?

The millennial generation is coming up short compared to other generations in accumulated emergency funds, participation in employer retirement plans, and they seem to be a bit skittish when urged to invest. But that's not to say they are doomed. Millennials are saving at an earlier age than Gen Xers and baby boomers did and many of the challenges like student loan debt and high housing costs aren't their fault. However, saving more, maxing out the employer's 401(k) match (if available), and dipping their toes in the water of other investments would hedge the millennial's outlook to greater retirement success.


Blog topics:
Investing

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