Over the past 18 months, our home offices have taken on greater importance. Having a functional, organized home office makes our professional lives and our financial lives easier to navigate. If your home office needs attention, it is time to get started. Financial Spring Cleaning Just like when you go through your closet or food pantry to determine what to keep, what to donate, and what to toss, you need to do the same with your financial life. Perhaps even more important than what you keep is what you can shred, recycle, or delete. Keeping unnecessary documents and statements makes it harder to locate vital personal finance information in a hurry. Most of us waste a lot of time trying to find things on our computer and amidst our papers. Getting rid of unnecessary documents frees up precious space in your file cabinet and on in your filing system on your hard drive. Keep both a recycle bin…
Watch Out For Fraud
During turbulent times, people are often anxious, preoccupied, or distracted. Not surprisingly, there is a positive correlation between turmoil and the incidence of cybercrime. Identity theft and financial frauds have been on the rise: hackers and scammer prey on people’s fear and vulnerability. Advances in technology and mobile communication have changed the way we manage our finances. These innovations save time and allow us to be more informed consumers. But the innovations have also introduced new risks and exposures. With time, your financial accounts will grow, and so will the potential losses from identity theft and fraud. Review your credit report regularly. You can download your free report and search for errors or indications of fraud at www.annualcreditreport.com. If you will not be in the market for a new loan soon, it is possible to freeze or lock your credit profile to reduce the chance of identity theft. In that…
Prudent Use of Technology
Technology is an essential part of how we transact and manage our financial lives. We are more informed and have real-time access to our personal finances. Along with convenience, however, comes new risks. Advances in technology and mobile communication have changed the way we manage our finances. These innovations save time and allow us to be more informed consumers. But the innovations have also introduced new risks and exposures. With time, your financial accounts will grow, as will the potential losses from identity theft and fraud. Review your credit report regularly. You can download your free report and search for errors or indications of fraud at www.annualcreditreport.com. If you will not be in the market for a new loan soon, it is possible to freeze or lock your credit profile to reduce the chance of identity theft. In that case, you need to contact each of the three credit bureaus:…
Email Hacks: What to Do
Numerous schemes have emerged to take advantage of people’s vulnerability due to COVID-19. Examples include phishing emails referring to urgent pandemic updates, robocalls from the Department of Public Health, texts related to unemployment claims, phony DocuSign requests, and, of course, email hacks. Most experts anticipate that the incidence of fraud will continue to escalate. For the past six years, I have written and spoken extensively about getting one’s financial house in order. Passwords, security, and identity theft protection are all topics that I address. I am well versed in the subject, but despite this I discovered that my personal email was hacked. Data breaches are unfortunately common – we have all seen the headlines. As surprised as I was that this happened, I was equally surprised at how little help I received from my provider to address the issue. While I took some steps right away, there were also others…
When In Doubt, Throw It Out Or Maybe Not?
We all feel better after we clean out our closet or our pantry. The same is true for your financial life. Most people save far more financial information than necessary. An essential part of clearing out your home office is figuring out what you should keep and what you should not. Here are some general guidelines that I follow to get organized: What to Keep Keep tax returns and all supporting documents for seven years from the date that you file your taxes, not seven years from December 31st for a particular tax year. Keep all bank statements and credit card annual statements and summaries for the same seven-year window. Keep receipts for any major purchases and all insured things as long as you have the item. Keep student loan, car loan, and mortgage documents (including payoff notices) and documentation for any other loans indefinitely. If you own your home…
Creating an ICE – In Case of Emergency – File & Plan
An In Case of Emergency, or ICE, File and Plan includes vital contact, financial, and legal information. These tools are invaluable during a crisis—just like a roadmap of your financial life. This is especially true when someone must act on your behalf. Pulling together your ICE File and ICE Plan takes some effort. As with all emergency preparation, this groundwork is most effective if it is in place before an emergency happens. Moreover, you need to discuss the File and Plan with your key person(s) – executor, power of attorney, or someone you trust implicitly to help handle your financial affairs. These safeguards are not useful unless someone knows that they exist and how to access them. You may think that your financial profile is simple. Walking through this exercise ensures that your bases are covered. Moreover, with time, your life—and your financial life—will evolve and become more complex. Life…
Guidelines for Financial Spring Cleaning
As many of us work from home, we are rethinking how we use space. Moreover, we are evaluating what we need and what we do not. Just like when you go through your closet or food pantry to determine what to keep, what to donate, and what to toss, you need to do the same with your financial life. Perhaps even more important than what you keep is what you can shred, recycle, or delete. Keeping unnecessary documents and statements makes it harder to locate important information in a hurry. Most of us waste a lot of time trying to find things on our computer and amidst our papers. Getting rid of unnecessary documents frees up precious space in your file drawer and on your hard drive. Check out the link below for suggestions about what to keep and for how long. Everyone’s financial situation is unique, so it is…
Organize Your Tax Files – You Will Be Glad That You Did
Preparing your taxes is not a fun task. It can be significantly less unpleasant if you are organized. Your taxes involve a lot of documents, and you must keep good records. In addition to your W-2 (or 1099-Misc forms, if you are a contractor), you will need supporting documentation related to your savings and investment accounts. A 1099 is a statement that details the dividends, interest, and capital gains earned during the year. Some investments are structured as partnerships and provide a year-end, or annual, K-1 instead of a 1099. A K-1 shows an investor’s share of partnership income for a given year. Transactions that you need to document at tax time occur throughout the year. Therefore, I strongly recommend that you keep a Current Year Taxes folder. As you receive tax-related documents in the mail or from a financial firm’s portal, store them in this paper folder or a…
Tip for Tracking Regular Home Maintenance Outlays
In your contacts notes field, track the amount you pay each year for regular home maintenance services. Yesterday, I was significantly overcharged. I contacted the manager and shared what I have spent over the years. He apologized and quickly corrected it. We all make mistakes sometimes. Especially now, local businesses truly value long-term clients. Please support them.
Too Many Passwords…
Whether appearing in your mailbox or your browser, financial information inundates us daily, adding to the papers and information (virtual or real) you already have. Some of it is important; some of it is not. Not only should you strive to reduce the amount of paper and computer files that you retain, but you need a system for organizing everything that you decide to keep. Not only are we inundated with information, our lives require more passwords than ever. Time to confess: I have far too many passwords (financial accounts, online shopping, subscriptions, kids’ schools, activities . . . the list goes on). I have wasted a lot of time trying to find or remember them all, and I worry about online security. Your passwords need to be secure, whether you write them on a piece of paper (keep the list hidden far from your computer) or you use a…