Summer Staycation

In Pre-Covid times many of us would be enjoying or planning a summer vacation. I had originally looked at this month and planned to write about summer vacations, saving for them and the importance of enjoying your money and your time. Just as summer plans have shifted, I thought I’d shift to talk about ways to enjoy the opportunities for entertainment and relaxation you can find around you.

This may be your summer to save money. Being forced to stay close to home opposed to taking the big vacation should cost less. You could use those extra funds to put towards another financial goal or take those funds and add to next year’s vacation fund for a bigger dream experience. Even if you did not have a vacation planned it is still summer and you want to take advantage of the weekends.

So what do you do? You have the time off, might be tired of being home after self isolating for months, but still want to maintain social distancing. Following are a list of places to consider exploring, maybe you’ll find a treasure close to home you have experienced before.  I am located in Western, NY so I am going to share some local experiences I have been encouraged to check out. Let me know what you find in your area! 

• State Parks - Last summer I wrote a blog “Summer In the Park” sharing information about the New York State Park system. This is still one of my favorite go to options for an easy, frugal day out surrounded by natural beauty. A quick tip to find a park near you is to use Google Maps. Zoom out and type in the search bar the type of park you’d like to find (local, county, state) and they will be marked for you. 

• Wineries - I am blessed to be in the Finger Lakes region and we have beautiful vineyards. You do not have to be a wine drinker to enjoy this, seeing the operation and following the trails to see the scenery is a fun outing. One excursion in our area is the Seneca Lake Wine Trail, mapping out a journey to follow. 

• Museums - There are going to be more restrictions on visiting indoor locations so I recommend calling ahead to see if you need to reserve a time to visit. In nice weather you can also visit outdoor museums and historical sites. Right down the road from our primary Corning office is the Corning Museum of Glass and The Rockwell Museum of Art. A little further away we really enjoy the Rochester Museum and Science Center. Outdoor sites - Again right in Corning is Heritage Village and a little further away one of my favorite destinations is the Genesee Country Village and Museum. 

• Hiking Trails - Free to explore and likely easier to avoid people! A quick google search should bring up local trail maps. Please be safe and take a hiking partner. The Finger Lakes Trail runs right through my town, there are over 1,000 miles of trails so there are many opportunities to find a small section to hike. 

Use this summer as an opportunity to explore life in a way that may be different for you. See what your area has to offer. With conditions and requirements changing regularly I do encourage you to call or visit the website of where you plan to go beforehand to be aware of any closures or requirements they may have.

This is a summer to reconnect with your local community, and remember Amy’s saying, “Life is about events, supported by your dollars and cents.”

What does your 1040 tell you?

Before we dig into the “year in review,” we’d like to mention a provision that was written in to the CARES Act regarding Donations. Beginning in 2020, there will be an “above the line” charitable deduction (maximum $300) that you will be able to take, even if you don’t itemize. So, save your receipts this year, even if you don’t itemize, those donations will reduce your 2020 tax liability.

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By  Kate Welker, CFP®

This week we would normally be seeing the tax deadline hit and the last minute rush of filers. With the deadline extended the filing season will be drawn out over three more months, but we still encourage you to finalize your return so you can plan accordingly for 2020. Once your return is done you should take time to review the returns and see what the numbers are telling you. Over my years of working with tax returns I have had way too many people tell me they just look to see if they have a refund or owe, sign the return, then stick it in their files. I challenge you not to be one of those individuals. Following are some items I like to look at when assisting with tax planning.

Large Refund- getting a refund is always nice, but if it is a large refund consider why it is so large. If you are over-withholding from your paycheck use the Tax Withholding estimator at www.irs.gov to see how you should adjust your W-4. Your end of the year refund would be smaller, but that could give you several hundred dollars more a month in your budget. 

Balance Due - If you owed over $1,000 on your return you will need to make changes or set up quarterly estimated payment to avoid being penalized on the next year’s return. You can also check the withholding tool at irs.gov to adjust your W-4. 

Credits - Look on your 1040 at lines 13a (Child tax credit) and 13b (other credits from Schedule 3). If there are entries on those lines you received a tax credit. A credit is a dollar for dollar reduction in your tax so changes in these year to year can make a large impact on whether you receive a refund or owe. Take a look at what the credit was for and if this is something that will be the same next year or will change. If you have a child turning 17 you will not receive the child tax credit of $2,000 the following year, this means your refund would be $2,000 less or you would owe $2,000 more. Conversely think about any credits you may qualify in future years. For example if there is a child heading to college you may qualify for the American Opportunity Credit which is up to $2,500. 

Dividends and Capital Gains - If you hold mutual funds or stocks in your portfolio you may have taxable income due to dividends or capital gains distributions. If you find these numbers are large you may want to speak with an advisor to make sure your portfolio is designed correctly for your needs and tax situation. 

Overall your tax return tells you a significant amount of information about your financial situation. These are just a few of the big items I take a look at, but each individual is different. It is one of the places where everything comes together for a quick snapshot. I really want to encourage you to take the time to pull out the papers and look it over, make sure you understand what your income and deductions are, and over time learn a little more about how your information comes together on that 1040 each year.

10 Essential College Selection Criteria Most Students Ignore

In this week’s blog, Financial Planner and Financial Wellness Coach, Amy Irvine, CFP®, EA, MPAS®, CCFC digs into selection criteria often overlooked when selecting a college.

1. Does the school really matter? — Unless you’re planning to enter a highly specialized field, the school may not be as important as you think it is. As long as the school has a good reputation — like many state colleges and universities — why pay more than necessary to obtain a degree? Caution: No matter which school you select, make sure it’s accredited and that the credits will transfer if you need or want to switch to another school or obtain a higher degree.

2. Do they offer the right degree program? — The degree can pay for itself over and over again...or be worthless to employers. While you may have a strong interest in the historical events of the 1700s, it may be difficult to find a job that pays for this type of knowledge. The greatest current demand is in one of the STEM (Science, Technology, Engineering, and Math) fields, but of course, there are other rewarding areas of study as well. Go to PayScale: Majors That Pay You Back to learn more about salaries in your chosen field.

3. What’s the cost? — CNNMoney’s Cost of College Estimator will provide the estimated annual cost, including tuition, fees, and room and board. It also provides the estimated cost after grants and scholarships — both for one year and all four years — based on family income. Looking at the estimated costs both before and after grants and scholarships can have a huge impact on your ultimate choice. Another source is the Department of Education’s Net Price Calculator Center.

   Caution: Many schools include access to student loans in their financial aid numbers and sales materials. Dig a little deeper to find out if it’s truly free money or simply the ability to incur more debt.

   Caution: Most students are unaware that subsidized (the government pays it) student loan interest doesn’t last forever. For first-time borrowers on or after July 1, 2013, the clock is ticking on the time the government will pay interest on their loans. Switching majors, taking too long to graduate, etc., can trigger thousands of dollars of interest on top of the loan amount borrowed.

   Solution: Follow the new guidelines at Federal Student Aid Loan Subsidy [PDF] and New Rules for Subsidized Loans.

4. What’s the graduation rate? — The ultimate objective for most students is to complete their education in the shortest amount of time, and with the degree needed to secure the best job. Plus, if students don’t graduate, it will be hard for them to repay their loans.

   Yet, the National Center for Education Statistics reports that it took six years for 59% of first-time students at four-year institutions to complete their degrees. Obviously, being able to graduate in less time — ideally four years or less — illustrates the school’s commitment to helping students keep costs down and move into the workforce sooner.

   There are two factors to evaluate in this category:

   1. The number of years it takes the average student to graduate — College Results will help compare multiple colleges’ four-, five-, and six-year graduation rates. Also, consider the Pros and Cons of ThreeYear Degree Programs. Example: Rachel failed to research her school before she attended. Due to the schedule of when classes were offered, it was virtually impossible to graduate in less than six years. She is now struggling to repay $65,000 more in student loan debt than friends who graduated in four years.

   2. The percentage of students who actually graduate — College Completion is a site that identifies graduation rates for two and four-year schools. PayScale is a similar site that highlights graduation rates, college costs, and overall value.

5. How much is the student loan balance for new grads? — As CBS Money Watch highlights, student loan debt continues to rise. The level of debt ties back to the cost of the school, how long it takes students to graduate, and how much of the total cost is covered by grants and financial aid (other than student loans). Locate the best and worst states with student debt at WalletHub, but ask about the actual debt levels at specific schools of interest as well. Some of the lists in #8 include this important data.

6. ROI: Will the numbers work? — The bottom line for all students is how much they’ll be able to earn once they graduate...and if it will be enough to repay the cost of the education. For example, the Center for College Affordability reports that engineering and economics graduates typically earn almost double what social work and education graduates receive by mid-career.

   When comparing potential salaries, there are two criteria to evaluate:

   1) The average salary per graduate of a specific school: PayScale.com: College ROI Report (click on the specific school for details)

   2) The average salary paid for specific degree programs: PayScale.com: Salaries per Degree

   Before applying for a student loan, estimate the costs of the college(s), how much you’ll need to borrow, and the projected income in your chosen field. Then go to FinAid.org to calculate monthly payments and determine if the numbers will work.

7. What’s the student loan default rate? — Schools with a high student loan default rate (often referred to as the cohort rate) send a big red flag to prospective students that the school may be too expensive, the students may be borrowing too much, it takes too long to graduate, or that students can’t find a job upon graduation. To check a school’s three-year cohort default rate, search College Navigator or the Department of Education’s Cohort Default Rate Database.

8. How are the schools rated? — Another step is exploring the myriad Best Of rankings. There are all types of comparisons in these lists, from generic ratings like the Best Schools in the Midwest (best regional schools) or the ones with the prettiest campuses to more specific lists such as the Top Undergrad Schools for Video Game Design (best schools for specific fields/industries).

   Carefully review the scoring system used to create these lists. In some cases they are so subjective, they may not be of much value, but any information will help you become a more informed consumer. When thousands of dollars are at stake and your future career is at risk, it will pay to dig into the details. For more details on the validity of lists, see Do College Rankings Mean Anything?

   Here are just a few of the lists and sites to help compare schools. Some are free or provide only limited information, but others charge a fee for complete access. Many of these 10 questions can be answered by several of the following comprehensive rating lists:

   ▪ Money’s Best Colleges (free basic info; full access $24.95/year)

   ▪ U.S. News: Best Colleges (free basic info; full access $29.95/year)

   ▪ Princeton Review’s Best 380 Colleges (create a free account for basic info; buy the book for $23.99)

   ▪ 50 Best Online Colleges (free)

   ▪ 100 Best Colleges & Universities by State (free)

   Caution: Again, evaluate rankings carefully. These lists are all different, so it’s important to look at the methodology each list uses to rank schools, their rating criteria, and if they allow “featured” schools.

   College Navigator — While this site won’t provide an external rating of the quality of a school, it’s a free government source to build your own table of preferred colleges to compare fees, financial aid, net price, programs and majors, and student loan default rates.

9. Will the school survive huge debt obligations? — In recent months, new regulations and overwhelming debt loads have caused more private and for-profit schools to struggle to stay afloat. Shark Tank’s Mark Cuban warns that this is just the start of the college implosion. This dramatic trend will not only affect current students but graduates as well. A degree from a school that is no longer in operation can lose its value quickly.

   The Department of Education has compiled a list of schools with questionable finances or that may lose access to Federal Student Aid. Consider avoiding schools that don’t meet the 90/10 Rule, where more than 90% of their income comes from Title IV (Federal Student Aid) sources.

10. What’s the mean SAT or ACT score? — This may sound like a trivial reason to select a school, but it’s actually an important stat to consider. If the mean (average) SAT score is 1600 at the college or university, and yours is closer to 1200, what’s going to happen when professors grade on a curve? While ambition is important, barely qualifying to get into a school could set some students up for failure, and could be a major reason they eventually drop out. Go to CollegeSimply: Colleges by Test Score or CollegeBoard: Test Scores & Selectivity to find a school that matches your scores.

This article is shared under the expressed permission and collaboration with Fiscal Fitness Clubs of America. Copyright 2017, Fiscal Fitness Clubs of America. This in an unpublished work of authorship protected by the laws of the U.S.A. It may not be reproduced, copied, published or loaned to other parties without the expressed written consent of Fiscal Fitness Clubs of America, LLC.

Assisted Living - Caring for Family and Friends

In this weeks edition of Morning Quarter-Buck, financial planner Becky Eason discusses a topic that is near and dear to her heart, as well as many of us who are faced with the decision of balancing the safety of our loved ones, with their emotional desire to stay at home.

By: Becky Eason

We all love our friends and family and want to make them as happy as possible. If you were to ask your friends and family what one of their hopes/wishes in life would be, it’s safe to assume that they would respond with being able to remain at home or at least out of a nursing home for as long as possible. 

Being able to fulfill the goal of keeping loved ones out of the nursing home for as long as possible can be challenging. I know exactly how challenging this can be, as I’ve been witnessing it firsthand with the efforts my parents have been going through with my grandparents. If you aren’t able to provide the care that is needed due to time or resource constraints, there are many programs available to help assist you. In Steuben County, New York for instance, there is a wonderful program available, Forward-Thinking Home Solutions. You may recognize this name from one of Amy’s Wine and Dime Podcasts where Amy interviewed the founder of Forward-Thinking, Sue Gruber. Sue will go into someone's home and make recommendations on what changes should be made to help keep your loved one living safely at home. She will also provide you with available resources and grants that you can apply for to help fund the necessary changes. If you don’t live in Steuben County don’t feel left out. There are programs all over the country that are there to support you. One such program that is available nationwide, is Meals on Wheels, which provides meals to individuals who are unable to prepare their own meals.

Maybe you aren’t able to keep your loved one at home but they aren’t yet ready for a nursing home. Your loved one might be able to go into an assisted living home. These homes provide a more independent lifestyle than a nursing home, but there are still staff members around at all times to help. Services that are provided at assisted living homes include meals, medication monitoring, personal care assistance, social activities, and housekeeping/laundry. 

Unfortunately, there will likely come a point when you must make the difficult decision to put your loved one in a nursing home. When you get to the point of having to make this decision it will very likely be emotional and you will question whether you made the right decision. If you are faced with this emotion, know that you aren’t alone and remind yourself that you did it for the safety of your loved one and those around you. 

Fraud Protection and Simplifying Your Life

Did you know that this week is both fraud protection and simplify your life week? I don’t know about you, but I feel like this is a contradiction of terms. It seems that in order to protect myself from fraud, I have to create very complex passwords, wary of whom my information is going to, and often increasing the complexity of my life. In this week’s edition of Monday Morning Quarter-Buck, Financial Planner Becky Eason (aka Partridge) discusses how to marry these two concepts.

By: Becky Eason

For many years now it seems that there are non-stop scams going around. Have you ever been a victim of fraud or identity theft? If you have, you’re not alone. If you haven’t been, then hopefully we can help you reduce your chances of having to go through that.

Simplifying will help you with so many aspects of life, including those that you may not have ever imagined. Stress is a very serious condition, often caused by being overwhelmed. I know that for myself that if I see clutter around me I get stressed and frequently ask myself “Where do I even start?” A great way to start simplifying, is to get in the habit of filing away papers/receipts that you know you will need, throwing out papers that you don’t need (but make sure there is no personal information on them), and shredding the papers with personal information that you don’t need.

Doing this will not only help with the overwhelmed feeling but it will also increase your security. For the papers that you need to keep, put them in a secure place, such as a locked filing cabinet. If you have documents that require extra protection you could consider a fire-proof safe, or a safety deposit box at a local financial institution. With having these documents in a secure location you are minimizing your risk for fraud.

Pertaining to documents, please be aware of what you are sending across email. It’s very easy for documents to be intercepted by the wrong party. Do your best to not send anything with your social security number, account numbers, or usernames and passwords. If you do have to send these items, you can use encryption to help keep the information more secure. 

Another thing to do to protect yourself from fraud is to change your passwords on a regular basis. It’s so easy to think “I’ll change my password later” but then forget. Maybe you intentionally don’t change your passwords because of the fear and or hassle of forgetting what you changed it to. There are a number of great secure password managers out there such as “LastPass” which allow you to store all of your passwords in a secure vault with just one complex password that you have to remember (and change). If you use a password manager like “LastPass” make sure that your password is very strong, as if someone figures out this password they have access to virtually all of your stuff.

When you take measures to protect your identity it may seem like you are making your life more complicated, but trust me, it’s much easier in the long run to take preventive measures than to need to take legal action. Please be aware of who is asking for your information and why they are asking. If you ever have a suspicion that something doesn’t seem “right” trust your instinct and ask someone you trust. It’s okay to ask why they need it and what they need it for!