I saw a headline “Having children can ruin your retirement”. Now I know that sounds terrible but it did catch my attention, we’ll dig into what that really means.Sometimes we have no choice, we have to tap into retirement accounts early, and that means penalties. In some cases you can avoid or reduce those penalties. I’ll explain how that works. And were always talking about ways to save “before” retirement, we’ll see how to save “after” retirement.Tune in at 7:30 a.m. at 95.5FM KBEK. They live stream at kbek.com.Hear recent shows at our podcast page at yoursafemoneyshow.com.
Borrowing from your 401k is not a good idea, and here's why. When you borrow from your 401k, you are taking a loan. Yes, that's right. You are borrowing money from yourself.Usually, you have five years to pay the money back with interest. If you end up leaving your job before the loan is paid back, you usually have to pay it back within 60 days of leaving, or it's considered a distribution and taxed as income. Not only are you paying interest on your own money, but you're doing it with after-tax dollars. You will have to pay taxes on those same funds again when you withdrawal the money in retirement. This is known as double taxation. You’ re also missing out on any compound growth that your investment would have earned if you didn't take the loan. While you’re paying back the loan, you probably won’t be contributing to the 401(k) so you miss out on the company match.
Those considering a 401(k) loan should compare the rates they can get on other types of loans, such as a home equity line of credit. For people with solid credit, that will likely be a better option than borrowing from the 401(k).
For more information call 855-22money or go to the website yoursafemoneyshow.com.
On this weeks (9-23-17) Your Safe Money Show, we’ll continue my interview with Kalen Sigecan from Gradient Annuity Brokerage, we ran out of time last week so we’ll finish our discussion with him.Also there’s new information from Wallethub about outstanding credit card debt, we’ll cover the implications of that trend. And if you’re getting married yet this year, you need to know money mistakes that can get your marriage off on the wrong foot. Marriage can be a big adjustment and money problems are always listed as one of the top issues in a marriage. Tune in at 7:30 a.m. Saturday at KBEK 95.5FM. They stream live at kbek.com. To hear recent podcasts go to yoursafemoneyshow.com.
Medicare is to begin sending out new cards that replace the Social Security number with a randomly generated beneficiary identifier.The government will begin sending out new cards next April, with all cards replaced by a congressional deadline of April 2019. Why the long lead time? Medicare is a big, complex bureaucracy, and replacing the cards is expensive: Officials estimated in 2011 that replacing the cards would cost between $812 and $845 million.Fraudsters will likely take advantage of confusion around the transition. Beware of scammers pretending to be with Medicare and demanding that you disclose your personal information or lose your benefits.
Do not carry your Medicare card with you. Maybe your first appointment you may need the original card but after that take a picture of the card on your smartphone to show healthcare providers.
We’ll remind you of this change in March but for now just be aware of the change coming. If you have any questions message us or go to the website yoursafemoneyshow.com.
We have an in studio guest this week (9-16-17) on Your Safe Money Show. Kalen Sigecan from Gradient Annuity Brokerage out of Arden Hills will answer questions about Gradient, what they do, how long they've been around and how they partner with Sjoberg & Holmstrom. But you'll also learn about annuities, how they've changed over the years, how they work for today's retiree, and much more.You don't want to miss this Saturday's edition of Your Safe Money Show heard at 7:30 a.m. on KBEK 95.5FM. They stream live at kbek.com.To hear recent shows go to our podcast page at yoursafemoneyshow.com.
According to new data released by the Consumer Financial Protection Bureau, in 2016, U.S. consumers paid a total of $15 billion in fees for bouncing checks or over drafting.
Where these fees really hurt are consumers with low balances and little margin for error.
The average amount of money consumers overdraft by is about $24 -- but banks often charge fees of around $34 for each overdraft incident.
The Federal Reserve decided to crack down on the issue in 2010 by mandating that banks must receive a customer's explicit permission to approve a transaction when there are insufficient funds, and trigger overdraft fees. Otherwise, the transaction would simply be declined. However, customers that opt in and frequently overdraft "typically" wind up paying $450 per year in fees.
The Consumer Financial Protection Bureau said that it's testing out a new version of the opt-in forms, which are designed to make the issue clearer for customers. Monitor your bank accounts closely to help avoid these fees.
On this weeks (9-9-17) Your Safe Money Show, I have facts about Social Security everyone should know.Also there are people and their circumstances that can ruin your retirement, I’ll have suggestions to keep that from happening.And Medicare is fixing a major identity theft risk, I’ll explain that as well.Tune in to KBEK 95.5 FM Saturday mornings at 7:30. KBEK streams live at kbek.com. Hear recent shows at the podcast page at yoursafemoneyshow.com.
