Asking for a Friend - Should I use a password manager?

October 2, 2023

Question:

I realize this is not a financial question, but I was recently sitting around with a group of friends, and we got on the subject of passwords. I remember you saying something about a password manager, but now I can't remember!

Personally, I have so many usernames and passwords for hundreds of websites that I use, do you think I should use a password manager?

Short answer: YES!

Long answer: While we are not cyber security experts, we work with one! He strongly recommends using a password manager. His top pick is 1Password. This "How to Geek" article also gives some good password tips and provides some password managers you might want to scope out.

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Asking for a Friend: It's hard to talk to my spouse/partner about finances and our budget; any tips?

September 25, 2023

Question:

It’s hard to talk to my spouse/partner about finances and our budget; any tips?

Answer:

First, know that you are not alone. We hear this a lot. Unfortunately, many people carry around money trama, so getting to the root of that is essential. Amy Irvine (who is a Certified Financial Therapist-Level I™ Professional) provides these tips:

• Set a money date with each other and be ready to listen and be open. Don't try to solve a problem during the first meeting, just make a list of all the concerns and fears.

• Consider talking through your money Psychology with each other. Is one of you a love and belonging spender and one of you a safety and security saver? How can both of you "win" if your personalities are different?

• Consider hiring a third-party to listen to both sides - they may help you find the words to communicate with each other; providing you with talking topics that will help you get to the bottom of what makes the conversation hard.

Note: If one person simply puts their head in the sand when it comes to money, we understand that can create significant conflict and stress. This takes work to resolve, but some training Amy was provided though the Financial Therapy Association included:

• Set the stage by framing the conflict as an opportunity.

• Separate the people from the problem and reframe the issue.

• Focus on interests, not positions.

• Develop options for mutual gain by focusing on the interests.

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Asking for a Friend - With federal student loan interest at its highest levels in a while, are there other funding options I should be considering?

September 18, 2023

Question:

With federal student loan interest at it highest levels in a while, are there other funding options I should be considering?

Answer:

While there is no foolproof way to avoid higher interest rates on student loans, there are a few ideas to consider:

1. If you/your child have federal direct unsubsidized loans (interest accrues immediately as opposed to subsidized loans where the interest is deferred while the student is in school), you can pay down the accrued interest periodically even before the student has to begin repayment. Though this technique doesn’t avoid the interest rate, it may help manage it better for the long run. This is when compounding interest can work against you.

2. Do you have relatives who may want to help you/your child and get assets out of their estate? Did you know that anyone can pay an educational institution directly and not have the dollars be subject to gift tax? What a fabulous gift to give!

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Asking for a Friend - I feel like I'm swimming in a big pond, but not sure which direction I should go to get to shore. Any suggestions?

September 11, 2023

Question:

I've been following several Facebook pages, You-Tube Channels and your Newsletter - I feel like I'm swimming in a big pond, but not sure which direction I should go to get to shore. Any suggestions that will point me in the right direction?

Answer:

This is an excellent question. I recently listened to a podcast by Carl Richards (Behavior Gap Radio) that was titled "What State Are You In?"

What does that have to do with your question? This may sound self-serving, but sometimes when you feel like there is too much data, that's when you need to seek either a coach or a planner.

When it comes to money, people think they should just "know" what to do, but the problem is your situation is vastly different than anyone elses and it requires some individual diagnostics.

It's great that you are trying to self-educate, but self-diagnosing your financial situation can be just as overwhelming as trying to self-diagnose a medical condition. So, my suggestion to you is to seek some guidance, search for someone that can guide you through all the minutiae; someone that can make sure you are in the "right state." Here is a link to the Behavior Gap Radio Podcast

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Asking for a Friend - What are the pros/cons of putting a freeze on your credit report?

September 4, 2023

Question:

Could you possibly talk about pros/cons of putting a freeze on your credit report, how to do it, and what agencies are involved in the freeze?

Answer:

• Pros: No one (including you) can apply for credit under your name and social security number. Even if someone were to get your information they could not actually access your credit.

• Cons: If you need to apply for credit you will need to place a thaw with each credit agency. This will require logging into each site, but if you lose your password will be more difficult to accomplish.

• This article from Nerd Wallet explains how to freeze your credit report and what agencies are involved: How to Freeze Your Credit - NerdWallet

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Pass those questions on to us at AskRPG@rootedpg.com and we will feature them in our future newsletters.

Asking for a Friend - I’m on an income-based repayment plan. Should I consider enrolling in the new SAVE option?

August 28, 2023

Question:

I’m on an income-based repayment plan. Should I consider enrolling in the new SAVE option?

Answer:

The answer to this question depends. Some things you may want to consider are the following:

• Your payments will be calculated based on your income and family size.

• The income exemption is 225% of the federal poverty line. Other repayment plans such as REPAYE and PAYE use 150%.

• Your payments will be 10% of discretionary income (income minus the federal poverty level calculation) until July 1st, 2024.

• After July 1st, 2024 you will pay 5% for undergraduate loans and 10% for graduate loans. If you have both undergraduate and graduate loans the payment will be based on a weighted average.

• You can file your taxes married filing separately to exclude your spouse's income. (It’s important to note that if you do this you can’t include your spouse in your household size).

• Loans will be eligible for forgiveness:

  • 25 years if you have graduate loans.

  • 20 years if you only have undergraduate loans, unless:

    • 10 years if your original loan principal was under $12,000.

    • Each additional $1,000 of principal will add one additional year before forgiveness, up to 20 or 25 years.

    • If you leave the PAYE program you won’t be able to re-enter PAYE after July 1st, 2024.

    • Borrowers on REPAYE will automatically be enrolled in SAVE.

    • There is no cap on the monthly payment. This means that in some cases, if you have a high income your monthly payment may exceed what it would under the standard 10-year repayment.

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Pass those questions on to us at AskRPG@rootedpg.com and we will feature them in our future newsletters.

Asking for a Friend - I'm making more money, but I am finding it hard to save. Any suggestions to make this easier?

August 14, 2023

Question:

I'm making more money, but I am finding it hard to save. Any suggestions to make this easier?

Answer:

We like anything that can be automated or "out of sight out of mind."

• If you are able to split your direct deposit with your payroll provider, you could select to have an amount sent right to a savings account and then the remainder sent to your checking account.

• Your bank may also be able to transfer a portion of your deposit automatically to a separate savings account.

• Another great trick is that as soon as you get a pay raise, put that amount into savings (either into a retirement account or to a savings account) before you get used to the extra money to spend.

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Pass those questions on to us at AskRPG@rootedpg.com and we will feature them in our future newsletters.

Asking for a Friend - I heard on the news that Fitch downgraded the U.S. debt from AAA (the highest rating) to AA+, so I have two questions

August 7, 2023

Question:

I heard on the news that Fitch downgraded the U.S. debt from AAA (the highest rating) to AA+, so I have two questions:

1. Who is Fitch?

2. What does this mean for me?

Answer:

Excellent Question! We've put together a summary that helps explain this:

Click HERE for full report!

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Pass those questions on to us at AskRPG@rootedpg.com and we will feature them in our future newsletters.

Asking for a Friend - My daughter is going off to college; Where do I get a Power-of-Attorney & Health Care Proxy for her?

July 31, 2023

Question:

My daughter is going off to college next month and I read an article that you wrote a few years ago about having a Power-of-Attorney and Health Care Proxy for her. Where do I get something like that?

Answer:

Great question! If you are working with an attorney, they will often prepare one for you at a low cost. Also, check with the college, they may have some documents that they will keep on file that will allow you to access information. Once your child turns 18, they have to give you permission under HIPAA to access their medical information, so make sure a HIPAA authorization form is on file as well.

Are your friends looking for a financial planner?

Here are 10 questions they might want to ask: 10 things to look for when you are considering a financial planner.

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Do your friends ask you financial questions?
Pass those questions on to us at AskRPG@rootedpg.com and we will feature them in our future newsletters.

Asking for a Friend - What is the difference between a durable and nondurable Power of Attorney?

July 24, 2024

Question:

What is the difference between a durable and nondurable power of attorney?

Answer:

• A durable Power of Attorney will continue to be in effect in the event you become incapacitated and unable to handle matters on your own on more than a temporary basis.

• A “nondurable,” Power of Attorney usually ends in the event the principal person significantly loses their mental capacity.

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Do your friends ask you financial questions?
Pass those questions on to us at AskRPG@rootedpg.com and we will feature them in our future newsletters.