Category: Personal Finance

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3 Benefits of Downsizing Your Life and Living Lean

live-lean1Americans born after World War II have grown up in a culture that seems to promise them everything. The greatest economy in history was built, in part, by creating an insatiable demand for “more.” Unfortunately, however, its consequences can be measured in part by an unmanageable national debt, the approaching scarcity of many natural resources, increasing class conflict, and the high degree of stress and unhappiness of society at large.
 
Many retirees, as well as those who hope to retire within the next decade, are discovering that their resources may not be able to provide the lifestyle they’d anticipated. For some, there is little alternative except to severely cut back expenditures and lower expectations. For those who have not yet reached those years, there is another option: living lean.

The Lure of Possessions and Immediate Gratification

Younger Americans often find themselves at a crossroads in life: They must choose whether to maximize their immediate pleasures, or balance them with their future needs. Unfortunately, too many opt for the former. They often do so because they believe the following.

1. You’re Only Young Once

If you don’t grab all you can now – big homes, expensive cars, extravagant vacations – you may not have another chance. However, what folks with this mindset don’t realize is that adventure, excitement, passion, and satisfaction are not exclusive to a particular age, or even income.
 
Former President George H.W. Bush recently celebrated his 90th birthday by skydiving, a feat he has performed every five years since turning 65. Boone Pickens, at age 86, is leading a national campaign to replace petroleum with natural gas and wind energy. Mick Jagger is still touring with the Rolling Stones. Grandmothers and grandfathers fill golf courses, ski slopes, and universities learning new skills and pursuing dreams.
 
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The truth is, there is no single age or stage of life that is better than another. And being young is not an excuse for irresponsibility.

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Is Dental Insurance Worth It?

teeth and dollarsParents spend thousands of dollars on orthodontics to ensure their children have what’s arguably the clearest physical indication of prosperity: a straight, white smile. George Washington was certainly prosperous, but he also endured the agony of poorly fitted wooden dentures for much of his life. And James Brown, the Godfather of Soul, claimed that if a man had his hair and teeth, he had it all.
 
It’s not surprising then that an entire industry is devoted to keeping our teeth healthy, clean, and attractive. Aside from a big boost in self-confidence, the condition of your teeth plays a major role in your overall health. As with many things, many people are willing to pay for those benefits. But is purchasing dental insurance the best way to go about doing it?

Problems With Adult Teeth

Fortunately, many dental problems can be avoided or delayed with proper attention, such as every mother’s admonition to floss. However, even with regular care, some dental problems do naturally arise with age:

1. Dental Decay. Cavities can deteriorate into root canals and crowns when left untreated.
2. Gum Disease. Plaque causes gums to recede, potentially exposing them to disease. Poor dental hygiene can exacerbate the problem.
3. Accidents. Teeth can be broken or cracked as a result of being hit or simply biting down on an olive pit or cherry stone. This can require removal of the injured teeth in favor of bridges or implants. In extreme cases, dentures may be required.
4.Oral Cancer. Smoking not only stains teeth, it increases your risk of cancer. Gum disease can also trigger oral cancer, along with other health problems.
 
In addition to good dental hygiene, regular checkups and cleanings are always necessary – and, unfortunately, these cost money. But beyond the pestering costs of basic maintenance lurk far more significant dental operations which have the potential to devastate your personal finances.
 
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Stretching Your Income to Meet Expenses

Coin stacksIf you just retired, congratulations. You’ve received the gold watch, relished the looks of co-workers who envy your new freedom, and begun to plan that long-awaited European tour you had always hoped to take. Life is good, but you do have concerns – mainly, whether your future income can sufficiently cover your basic living expenses, plus those little extras that make retirement special.
 
Financial experts generally calculate that you need between 70% and 85% of your pre-retirement income to maintain your lifestyle. Even if you were diligent about saving during your working years, it’s likely that your investment portfolio has not yet fully recovered from the recession, and returns are still lower than you expected them to be. How do you ensure that your nest egg is big enough to meet ongoing expenses?

Significant Future Income Increases Are Unlikely

Your future income will be a combination of Social Security benefits and the systematic liquidation and withdrawal of your retirement assets over the remaining years of your life. At age 65, you can expect to live, on average, another 19.1 years, according to the Centers for Disease Control and Prevention (CDC). If you are genetically gifted, however, you may live to 100 or longer – the number of centenarians in the U.S. rose to 53,345 in 2010, a 65.8% increase from 1980.
 
Your initial retirement calculations were probably based upon an annual withdrawal rate of 4% of asset value, a figure most financial planners had generally agreed would provide a stable income for 30 years. Nowadays, however, that percentage is considered by some to be too liberal. Recent studies have suggested that in the current economic environment, withdrawing income at a 4% rate could increase the risk of depleting your assets during your lifetime. Since the level of your future income is uncertain and may be lower than originally anticipated, it would be prudent to reduce your living expenses where possible so that less income is needed to provide the same quality retirement for your remaining years, however long that may be.
 
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How Identity Thieves Get Your Info – 7 Ways to Protect Yourself

identity1 In 2013, the FBI arrested a ring of identity thieves responsible for more than $13 million in losses over a two-year period, from 2007 to 2008. Tobechi Onwuhara, a Nigerian national, impersonated victims across the country to scam their credit card companies into transferring millions of dollars from their customers’ home equity line of credit (HELOC) accounts, and the information he and his confederates used to identify victims was primarily collected through public sources. In other words, any efforts by the individual victims to foil the perpetrators would likely have been futile.
 

How Identity Thieves Access Your Information

Onwuhara’s expertise was his ability to Collect and combine disparate pieces of personal and financial information available free or for a fee to anyone from legitimate sources of private information. His skill allowed him to impersonate credit card holders to have open credit lines monetized to his benefit.
 
Some of his favorite sources of data included:
 
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