A reader's son just inherited an IRA from his grandmother. It's not a big amount now, but if he plays his cards right, it could make him a millionaire one day.
This post comes from Stacy Johnson at partner site Money Talks News.
Here's the question:
My 22-year-old son is about to inherit just under $50,000 as a result of being named as a beneficiary to an IRA account from my recently deceased mother. Her financial adviser has strongly recommended he simply roll the money over into an IRA account in his name that he won't be able to access until he's 59½. While I can see the benefits of reinvesting that money, I'm just not convinced that it is his best option. What are some other shorter-term investment options, five- to 10-year plans, that you would suggest?
Much appreciated! -- Sue
First, Sue, I'm sorry for your loss.
When my father died a few years back, he left some money to me, my older sister and my niece, who was about 25 at the time. I salted my money away, and as far as I know, so did my sister.
My niece, on the other hand, used most of hers to supplement her meager income, although she did use the last of it for a wise purchase: a small house, which she bought cheap during the housing bust.
If I still had them, I'd share the emails I sent to my niece practically begging her to invest her inheritance rather than spend it. But now it seems I have another chance with Sue and her son.
Education, employment and finding a mate are major factors when it comes to your financial well-being.
This post comes from Allison Linn at partner site CNBC.
College graduates, people in dual-earner families, whites and those lucky enough to escape a bout of unemployment are also the most likely to move from the bottom fifth of the income ladder to at least the middle, according to a new Pew Charitable Trusts analysis of family income trends.
"Education, race and family employment matter for movement out of the bottom," said Diana Elliott, a research officer on economic mobility at the Pew Charitable Trusts.
In general, Pew researchers have noted, the rags-to-riches tale so popular in Hollywood is less likely than many Americans would like to believe.
Trying to figure out how to use the new insurance exchanges? Here's how it's going for others, along with tools and advice.
This post comes from Jeanne Pinder at partner site Credit.com.
If you're shopping for health insurance and your state built its own exchange, you might be very happy (Kentucky and New York, generally) or sort of happy (Oregon, where paper forms are now being used). If your state left the job to the feds -- meaning you are consigned to healthcare.gov with its tech problems -- you are most likely less happy.
Don’t worry: you’ve got some time. Decisions should be made by Dec. 15 for coverage beginning Jan. 1.
We’re here to help. Here are 10 great tools and tips to shop for your health insurance.
1. Do your homework. Get your information from an unbiased source, and from someone who’s not trying to sell you something. Some of the news coverage is wrong, and a lot of the private-party and big-company information tools may malfunction, or simply point you toward a purchase of the big company’s products. They ask you to give up a lot of info (on the United HealthCare site, for example, email, family details, medical history) and give you vague info in return. Some of the "decision support" tools direct you into plans but can’t calculate a subsidy, or don’t suggest other insurers’ products.
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Use these simple techniques and you'll give your kids the best foundation for using money wisely.
This post comes from Kentin Waits at partner site Money Talks News.
Kids are sponges; they soak up details from their environments more efficiently than most adults could ever imagine. So, it’s not hard to see how children can inadvertently absorb ideas and lessons we don’t mean to teach.
When we vocalize our stress over paying bills, argue with our spouse about money, and complain about how difficult it is to make ends meet these days, we might as well have a textbook in our hand and an apple on our desk.
Maybe it’s time to take a recess and figure out a better strategy for actively teaching our kids about money. In a world filled with financial pitfalls, working to create positive and empowering associations with money early can help set children up for a lifetime of better choices, less stress, and more security.
The troubled federal website brought up to 50,000 enrollees in private plans in October, far below the White House's initial expectations.
This post comes from Christopher Weaver, Timothy W. Martin and Louise Radnofsky at partner site The Wall Street Journal.
Fewer than 50,000 people had successfully navigated the troubled federal health care website and enrolled in private insurance plans as of last week, two people familiar with the matter said, citing internal government data.
The figure is a fraction of the Obama administration's target of 500,000 enrollees for October. The early tally for the HealthCare.gov site, which launched Oct. 1, worries health insurers that are counting on higher enrollment to make their plans profitable.
The right rewards card makes it easy to get a little something for yourself -- points, or a cash bonus -- when you're buying gifts for others.
This post comes from Jennifer Calonia at partner site GoBankingRates.com.
As the winter season draws near and holiday giving expectations become more and more grandiose, shoppers are starting to scrutinize how much their holiday spirit will cost them at the end of the year. However, shopping for presents can actually provide boomerang benefits with the use of a rewards credit card.
Those in the market for a new credit card stand to gain the most from rewards-based cards, especially during the holidays. With credit card companies offering more sign-up incentives to entice new customers, it’s prime time for free money.
In addition to incredible cash bonus offers -- some in the hundreds of dollars -- charging gifts on a rewards credit card can also earn you points.
Here are a few of the best reward credit cards available today.
1. Barclaycard Rewards MasterCard
Having a credit card that helps you earn points during one of the busiest shopping periods of the year can be crucial when it comes to saving money. The Barclaycard Rewards MasterCard also provides new customers with an easy 5,000 bonus points (equivalent to $50) with the first purchase or balance transfer into the account.
But the benefits don’t stop upon opening a new line of credit -- they last all year long. The rewards credit card provides cardholders with an impressive two points on gas, groceries and utility expenses, so customers get cash back on daily living. All other charges earn one point for every dollar spent.
A few additional perks to the Barclaycard Rewards MasterCard include:
- No annual fees
- No blackout dates, caps or expiration on points
- 0% APR on purchases and balance transfers for 12 months
Points can be used on anything from next year’s holiday flights and gift cards to getting a head start on 2014 wishlists.
2. PenFed Platinum Rewards Visa Signature Card
Pentagon Federal Credit Union is one of the largest credit unions in the nation, giving more than 1.2 million members the chance at exceptional cash-back returns through its PenFed Platinum Rewards Visa Card.
In addition to earning one point for every dollar charged to the account, the PenFed credit card also has a limited-time offer through Dec. 31, 2013 that will give cardholders five points on gas purchases at the pump and three points for grocery store purchases. After that date, points are adjusted to three and two points on gas and groceries, respectively.
There is no annual fee dragging down rewards, and the low 9.99% APR introductory rate won’t cause shoppers to turn into Scrooge on account of excessive interest charges.
3. Chase Sapphire Card
Shoppers who are too busy make dinner between gift list excursions can still benefit from reward credit card savings. Users of the Chase Sapphire credit card earn a generous two points on restaurant dining, plus one point for all other purchases.
Cardholders also receive an extra point for every $1 spent on travel purchases (airfare and hotel bookings) when purchased through Chase‘s Ultimate Rewards website. The perks don’t end there, as the bank is currently offering 10,000 bonus points to new customers that spend at least $500 in the first three months of opening the account.
The Chase Sapphire credit card has no annual fee and no point caps that hinder how much cardholders can earn through the year.
4. Discover It Card
The It card is Discover‘s new way of giving back to its customers with quarterly reward categories that have the potential to earn users a lot of return.
Discover It cardholders earn as much as 5 percent cash back on online shopping during the months of October to December 2013. There are no annual fees associated with the account, and the reward cap is as high as $1,500 in purchases for the holiday shopping season. All other purchases brings in 1 percent cash back, which is unlimited.
Additional perks of the Discover It credit card include an introductory 0 percent APR for the first 14 months on purchases and balance transfers. Additionally, rewards can be instantly redeemed on Amazon.com.
5. American Express Blue Cash Preferred Card
Although a big part of the holidays is gift giving, spending time with loved ones over a family-style dinner is also a cherished part of the season. Shopping for family recipe ingredients can save customers even more with the American Express Blue Cash Preferred Card.
Grocery shoppers earn 6 percent cash back at supermarkets across the nation, up to $6,000 in purchases every year. After the cap is reached, customers still receive 1 percent cash back on grocery store expenses.
More incentives are available to cardholders, including 3 percent back at gas stations, 3 percent rewards at department stores and 1 percent cash back on everything else.
Additional information to be aware of:
- An annual $75 fee applies.
- New users receive 150 Rewards Dollars (equivalent to a $150 statement credit) upon making $1,000 in purchases within the first three months.
- There’s a 0% APR introductory rate on balance transfers and new purchases for the first 15 months.
6. Citi ThankYou Preferred Card
For a well-rounded rewards credit card, the Citi ThankYou Preferred Card provides customers with the satisfaction of a great point system and additional purchase protections for those on the go.
Citi cardholders earn two points per dollar on restaurant and entertainment expenses, and one point for all other purchases year-round. They also qualify for a huge sign-up bonus of $200 after a $1,500 purchase balance is added to the account within three months of activation.
Other card features include:
- No annual fee
- Unlimited ThankYou points
- Points don’t expire
- APR is 0% on purchases and balance transfers in the first 12 months
Cardholders also receive early access to entertainment, via Citi Private Pass, and travel protection, such as travel accident insurance and lost luggage coverage for added peace of mind during the holiday travel season.
7. Farm Bureau Bank World MasterCard
Customers of Farm Bureau Bank can earn money-saving points with the bank’s World MasterCard. Double points are issued for every dollar spent on commonly shopped categories, such as dining and travel, as well as purchases on services and products from participating partners of the institution. All other transactions earn one point per dollar charged.
There are no annual fees associated with the account, nor any redemption fees that hack away at earnings. Plus, a 0 percent APR introductory rate helps keep holiday shopping costs low for avid credit card users.
New accounts also benefit from the Farm Bureau Bank’s current bonus point promotion, which gives customers an instant 2,500 bonus points after their first transactions, balance transfers or cash advances.
More from GoBankRates.com:
- 5 credit card tricks and hacks that can help you save big
- Study: 63 percent of holiday shoppers haven't saved a dime for gifts
- How to use a savings calculator to plan your holiday budget
Before you write a check to a charity this holiday season, follow these tips to ensure your money is being used to make a difference, not a profit.
This post comes from Maryalene Laponsie at partner site MoneyTalksNews.com
We are fast approaching the winter holidays and that means Salvation Army buckets will be making appearances outside stores across the U.S. But it's not just the Salvation Army that ramps up its fundraising during the happiest season. A 2011 report from The Chronicle of Philanthropy found that nearly 70 percent of Americans believe it is important to give to charities during the holidays.
For many of us, donating to the less fortunate is just as much a part of the season’s celebration as tinsel and carols. However, don’t let your warm and fuzzy feelings lead you to make bad decisions when it comes to donating to charities.
Cash-back sites will give you rebates on just about anything you can buy online. Smart shoppers visit these sites year-round.
This post comes from Donna Freedman at partner site Money Talks News.
Sound like a scam? It isn’t. These sites get paid to send buyers to online merchants, and then share a piece of that fee with their customers. All you have to do is start your online shopping trip at the cash-back site vs. going directly to the retailer. After clicking on the site’s link to Target, Drugstore.com or wherever, you’ll be sent directly to that company to shop.
Failing to use cash-back is “money left on the table – and all it takes is one extra step,” says Craig Cassata of Mr. Rebates. Put another way: If the cashier at a brick-and-mortar store offered you a cash rebate, who would say “no”?
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