Finance

To Bank Account or Not, That i$ the Question

No bank account? 3 reasons why having one is an important step to financial health

aving a bank account is

Hthe start to being truly in charge of your finances, including managing payments and getting paid. If you’ve never had a bank account before, or you’ve struggled with keeping one in the past, you have options.

Here are three reasons why having a bank account matters:

Saving on fees

When you get a check, is it a pain to cash it? Whether it’s from a relative or an employer, if you don’t have a bank account, you probably have to go through extra steps and pay fees to cash it. With a bank account, you can easily cash your check without the extra fees and can even take advantage of direct and mobile deposit, so your check automatically goes into your account without having to visit a branch. It’s not only convenient, but you’ll save money because you won’t have fees stacking up with each check when you get paid. That can amount to hundreds of dollars per year!

Paying Bills

Another issue people without bank accounts face is how to pay their bills. It’s difficult and even risky to carry around large amounts of cash so you can pay things like rent, groceries and child-care. In addition, electronic and digital payments are increasingly preferred by many, and are a more secure alternative than paying with cash.

A bank account that has a debit card allows you to easily pay your bills virtually anywhere at any time. Setting up rent or your electric bill to be automatically paid electronically at the start of the month helps you eliminate costly late fees. Pay in one swipe at the store for easy and fast checkout.

Staying on budget

Overspending can often trigger overdraft fees. However, some accounts do not charge overdraft fees. These accounts make it easier to stick to your budget and avoid overspending and overdraft fees altogether.

One example to consider is Chase Secure Banking, a simple and low-cost alternative to a standard checking account. With no minimum deposit to open and no paper checks, the account is designed to ensure you only spend what’s available in it, so you’ll never be charged overdraft fees. No more worries about when a check will go through and if it will bounce. You only spend what you have, making staying on budget simple.

Chase Secure Banking comes with all the benefits and perks of being a Chase customer, like fast access to thousands of fee-free ATMs, the mobile app, the ability to send and receive money and support from bankers in person or over the phone. Learn more at www.chase. com/SecureBanking.

Bottom line

Getting a bank account can help you gain money confidence and take more control of what you earn and spend. You can use your money like you want to, without extra steps, hassles or unnecessary fees. Take control of your finances and consider your options today.

COUPLING:

Spending it Together!

Turns out that “coupling” doesn’t just mean “pairing” in the traditional sense, but is also a catchphrase when it comes to finances. Because as much as you may think no two people have ever been more in love than you are, the truth is that it could be less than smooth sailing ahead if you’re not on the same page when it comes to financial matters.

“Couples have a very hard time talking about money,” Joan Atwood, a Hofstra University professor of marriage and family therapy, bemoaned on an NPR “Money Coach” segment on the issue. “I would say it’s the last taboo.”

Ready to break the cycle? Read on. • Set common goals. You have probably discussed this in a dreamy sort of way while dating, but turning those reveries into reality requires habitually saving to pay for them to finance your later retirement years. This is most likely one thing you may not have thought of at a time when the median ages, respectively, for brides and grooms are 29 and 31.

“While people may come into a marriage with their own assets, they need to take some time after the wedding to sit down and start getting organized as a couple,” advises Andrew Peterson, a vice president at Fidelity Investments. • Be transparent. There’s nothing that says you have to put all your cash into a joint savings account – but at the very least you’d be “less than truthful” by not divulging any outstanding debts – and then figuring out, together, how to pay them down. • Safely store your information. Quick: What’s your new spouse’s Social Security number? And what other vital information don’t you know if a sudden need arises?

To truly mark your financial coupling, you might consider using an online service such as FidSafe.com that lets you store, access and share all your new family’s important records and documents anywhere via a web browser or iOS app.

Not only is it free and simple to use with handy checklists, but even before it was officially introduced two years ago by Fidelity, Barron’s magazine gave the service five stars for being what it called “the first cloud-based safe deposit box we’ve seen that’s secure enough to organize everything from financial statements, insurance policies, and real estate records to a will, IRA benefits, and even passwords.”

“With all the other things on their to-do lists, newlyweds typically don’t focus on all the important financial and other documents they need to begin married life on a solid footing,” says Peterson. “This makes things easier for them from the start, as well as through the years as they have even more joint documents to retain – including those related to perhaps buying a house and having children.” • Investigate this option. Do you both get health insurance through your employer? Congrats. You may have just saved yourselves some money because, if it works out it’s less expensive for one of you to be on the other’s plan rather than pay for both.

Providing Protection for All of Your Insurance Needs

Call us for your Auto, Home, Life Insurance and Banking Needs

Servicing ALL of Virginia and Maryland

RepoRt:

Financial FRaud is taRgeting oldeR adults at RecoRd levels

The financial exploitation of older people is a rampant epidemic in America. A recent report by the Consumer Financial Protection Bureau revealed that each incident of financial fraud cost older adults ages 70 to 79 an average of $45,300. And when the older adult knew the suspect, the average loss rose to about $50,000.

As older adults experience more wealth events - from selling a home to making IRA withdrawals - they become more vulnerable to scammers. This can often happen when older people lose touch with those who can help protect them. While technology has made lots of things easier, including managing money, it has also increased the ways for scammers to weaponize fraudulent activity. It is more critical than ever to empower older adults to protect their financial accounts - and for trusted family and friends to help them do so, before it’s too late.

World Elder Abuse Awareness Day is observed in June. This is a great reminder and call to action to act on this topic. Through increased awareness and concrete steps, we can help our loved ones better protect their financial assets.

How to Spot Financial Fraud

Former FBI section chief of the Cyber Threat Division Greg Ruppert, now the head of financial crimes risk management at Charles Schwab, said, “I’ve seen every trick scammers use to separate older adults from their money and they are ever more targeted and sophisticated in their approach. Financial scams, no matter the amount lost, are devastating to older adults, who rely on those resources and are unable to recoup the loss.” Common types of scams targeting older adults include healthcare insurance scams, counterfeit prescription drug schemes, romance “ One of the BIGGEST scams, person-in-need scams, lottery scams, funeral and cemetery scams, telemarketing/ risk factors for older phone scams and investment schemes.

adults when FRAUD How Family Members has taken place is being Can Help

too EMBARRASSED Help protect your older family member against financial scams by staying engaged so to admit they may have you can spot the signs of an investment scam and help if warning signs appear. Speak to been scammed to ask for them regularly and be on alert for clues, for

HELP. ”

example if they mention being asked for money, or that managing their finances is confusing or overwhelming.

When you visit them in their home, notice visual cues such as unpaid bills or piles of unopened mail and physical clues like fearful behavior, worsening of an illness or disability as the result of the pressure from a scammer’s tactics.

One of the biggest risk factors for older adults when fraud has taken place is being too embarrassed to admit they may have been scammed to ask for help. This hesitancy can only be overcome with regular communication and wellness check-ins with trusted family members.

5 Steps to Safeguard Financial Assets

Here’s how you can avoid scams and make sure you and your senior family members are not victims of financial fraud:

1. Designate a trusted contact.

Financial institutions like Charles Schwab provide an option to designate a trusted contact - a person who can speak to your financial services provider in the event of an emergency, such as financial exploitation.

2. Get your financial affairs in order.

Understand your full financial situation, including locating and filing key financial records, creating or reviewing wills, establishing trusts and power of attorney declarations, and updating account and insurance policy beneficiaries as your life situation changes.

3. Guard your passwords.

According to the 2018 FBI Internet Crime Report, people over 60 experience the most incidents of online investment scams and the highest monetary loss. To protect your online financial accounts, create unique passwords and never share usernames, logins, passwords or personal identification numbers.

4. Get smart with your smartphone.

Scammers can mask their phone number to make it appear that a call is local or from a trusted party. Prevent telemarketing scams by joining the National Do Not Call registry and let calls from unknown phone numbers go to voicemail.

5. Up your technology game.

Local recreation centers and libraries offer technology and digital literacy classes to help older adults and their family members protect themselves online and learn about the latest financial schemes.

To learn more about how to educate yourself and your older family members on the latest financial schemes, visit: https://www. schwab.com/resource-center/insights/section/resources-for-senior-investors.

Financial Grade: C+

Half of Americans are ‘C’ students at best when it comes to understanding finances. Transforming knowledge into action bridges the gap from financial literacy to financial wellness.

When it comes to education, we instinctively understand the link between performance and opportunity - a college graduate is likely to have more job opportunities than someone who didn’t finish high school. Similarly, the high school valedictorian may be courted by more colleges and universities than a poorly performing student. In fact, data from the Bureau of Labor Statistics shows that higher levels of literacy and more advanced education tend to correlate to positive outcomes in wage growth and job opportunities. Because we know the importance of education, we push ourselves and our children to learn and grow, in the hopes of better opportunities in the future.

But when it comes to financial literacy and financial wellness, we seem to lose sight of the connection, contenting ourselves with barely passing grades. In fact, more than half of Americans say they’d earn a “C” or lower if tested on their financial literacy, according to a new survey conducted by The Harris Poll on behalf of Prudential Financial.

Nearly three-quarters (73%) take responsibility for their own grade, according to the survey. Why don’t we change our behaviors and work to improve our

knowledge of a topic we know to be so critical to our lives?

Information overload may be at fault. While the survey shows nearly half of American adults (46%) spend more than two hours on social media each week, fewer than one in five (17%) spend that much time managing their finances. In addition, two-thirds of Americans (66%) say the list of things they need to learn to successfully manage their finances keeps on growing, not shrinking.

“The financial industry as a whole needs to drive home the importance of financial education to help clear a path toward financial wellness,” said Caroline Feeney, head of Individual Solutions at Prudential. “It’s important for us to help Americans understand how to manage day-to-day finances, achieve im-

“...the Census data showed less than half of Americans are on track to meet their goals, including planning for retirement.”

portant financial goals and protect against future financial risks.”

Previous data from Prudential’s Financial Wellness Census shows more than a quarter of Americans (29%) have a skewed sense of their financial health, with many optimistic about their financial future despite objective measures showing them falling behind in achieving their financial goals. In fact, the Census data showed less than half of Americans are on track to meet their goals, including planning for retirement.

The challenge, then, is how to translate retirement uncertainty and financial insecurity into actions that help build financial wellness before and into retirement. That’s where financial literacy programs and professional financial advice can play a key role.

Today, people can access advice along the spectrum, from self-directed methods to hybrid advisors who serve as coaches to full-service, high-touch advice. “Our lifelong personal financial wellness journeys often require a combination of smart solutions, good advice and guidance about appropriate investment tools or products,” says Feeney.

Planning is critical to meeting financial goals (whether it’s buying a car or a house, paying for college or planning for retirement), so it’s important to find the method that works best for you. Life stage and personal preference will play a role in determining your path to financial wellness, but financial education, professional guidance and access to the right products and investments at the right stage of the journey are key components of the financial wellness journey.

The Prudential Insurance Company of America, Newark, NJ. 1020393-00001-00

Pay For

College?

When paying for your child’s college education, what you don’t know really can hurt you.

We’re talking 529 plans. They’ve been in existence since 1996, but a new survey from Edward Jones found that 67 percent of Americans don’t have a clue that they provide a tax-advantaged way to save money for tuition, books and

other qualified education-related expenses at most accredited two- and four-year colleges, universities, and vocational-technical schools. Worse still, that 67 percent figure is 5 percent higher than it was the first time the survey was done in 2012.

“It’s a concerning trend,” says Tim Burke, a principal at the financial services firm, Edward Jones.

“Concerning” because the current average price tag of a four-year degree, including tuition, room and board: $21,370-a-year at public schools, according to the College Board, and $48,510-a-year at private schools.

And just how do those surveyed think they’re going to handle those costs? • Personal savings accounts (38 percent). Keep in mind that the national average interest rate on such accounts is a measly 0.09 percent. Good luck trying to cover the more than $1,200 an average college student spends on books and materials over the course of a year with that. • Scholarships (35 percent). If your child is a prodigy or football star, hats off to you. Because Sallie Mae’s “How America Pays for College” 2018 report found that only 17 percent of college costs were paid this way. • Federal or state financial aid (33 percent). Pell Grants are the largest source of federally funded grants, and they max out at $6,095 for the 2018-19 academic year. That would cover about 28 percent of one year’s $21,370 average cost at a public college – except that, as the College Board explains, “most students receive smaller grants because they are enrolled part time or because their family income and assets reduce their aid eligibility.” • Private student loans (20 percent). According to the Brookings Institution, parents who take out loans do so to the tune of $16,000 a year on average, and nearly 10 percent are on the hook for $100,000. “College debt is increasingly becoming a parent problem, too,” ConsumerReports.com warns. Given all that, you can see why Kyle Andersen, another principal at Edward Jones, says that “by relying on scholarships or federal or state financial aid that a student may or may not receive, Americans leave themselves vulnerable.” Which brings us back to 529 plans.

Hats off to the 18 percent of those surveyed who said they’d implemented this strategy, which Edward Jones and others call “an attractive and practical way to save.” How so? Unlike personal savings accounts, the earnings in these plans – typically comprised of a portfolio of funds – accumulate tax-free, and qualified withdrawals are exempt from both federal and state income taxes.

The federal gift tax exclusion allows a contributor to give up to $15,000 per year, per beneficiary, or $30,000 for married couples. Although almost every state has its own 529 plan – with total limits sometimes reaching more than $500,000 – there’s no “hometown restriction,” so you might want to work with a local Edward Jones financial advisor to compare plans and review your situation.

One other thing that less than half of those surveyed knew: 529 plans can also be used to pay for qualified K-12 tuition.

EDUCATION

Smart ways to help students gain confidence in learning

Building the confidence to try, experiment and keep going even when things get hard is a critical part of the educational process. Confidence comes more naturally to some students than others, yet new research shows that confidence levels today impact learning outcomes for students.

Three-quarters of teachers say anxiety and lack of confidence hinder learning among their students, according to the Confidence in Learning Poll conducted by Harris Insights and Analytics on behalf of LEGO Education. Two-thirds of parents agree their children are not more confident than their peers or themselves at that age.

This is impacting students’ education in many ways, particularly in the important STEAM subjects (science, technology, engineering, art and mathematics). The poll found fewer than one in five students is “very confident” when it comes to learning STEAM, while only one in three teachers says their students are more confident in STEAM subjects compared to five years ago.

As we think about preparing students for the future workforce, 65% of children entering primary school today will ultimately end up working in new jobs that don’t yet exist, according to the World Economic Forum. This makes confidence in STEAM especially important as we prepare kids for unknown needs.

Building Confidence

Consider the middle-school years as an important time to grow and maintain confidence levels among students. A time of tremendous physical change, kids are also dealing with new academic and social pressures, too. The good