Benefits of Opening a Health Savings Account

 

Healthcare can be expensive. If you have an insurance plan with a high deductible, you’ll need to pay that amount before coverage kicks in. Opening a health savings account can help you prepare for medical costs and enjoy significant tax advantages.

How Does an HSA Work?
An HSA is similar to a personal savings account, but funds in it can only be used to pay for qualified health expenses. The Internal Revenue Service allows money in an HSA to be used for a wide range of medical, dental and mental health treatments.

To open a health savings account, you must be enrolled in an insurance plan with a high deductible. You can contribute money to an HSA yourself, and your employer and others can contribute on your behalf to help you save money for health expenses. The IRS limits the total amount of money that can be contributed to an HSA each calendar year.

In most cases, contributions to an HSA are deducted from an employee’s earnings each pay period. Since payroll contributions are made with pre-tax funds, they aren’t included in gross income, which means they’re not subject to federal income taxes, or to state taxes in most cases. You can also contribute to your HSA with after-tax dollars and deduct those contributions on your tax return. Interest and dividends earned on money in an HSA are tax-free.

HSAs typically provide account holders with a debit card that makes it easy to make purchases for qualified health expenses or to pay bills by phone. Some institutions that offer HSAs charge maintenance fees or a fee for each transaction, which can reduce the amount of money available for health expenses.

If you withdraw money from an HSA and use it for qualified medical expenses, you won’t have to pay federal taxes, or state taxes in most cases. If you withdraw money and use it for non-qualified expenses before you’re 65 years old, you’ll have to pay taxes and a penalty. Once you turn 65, you will be taxed but won’t have to pay a penalty on non-qualified expenses.

If you don’t use all the money in your HSA for health expenses by the end of the year, you can roll it over to cover expenses in future years. If you change jobs or insurance plans or retire, you can take your HSA with you. As a long-term strategy, you can let money in an HSA grow over time to help you prepare for higher healthcare costs you’ll likely face in retirement.

Enjoy Tax Benefits and Peace of Mind
An unexpected illness or injury can be financially devastating. With an HSA, you can set aside money to be prepared for unanticipated medical costs, while enjoying tax advantages and the flexibility to use your savings at any time for a wide range of expenses. If you have a high-deductible insurance plan, explore the benefits of opening an HSA.

This article is intended for informational purposes only and should not be construed as professional or legal advice.

8 Signs You're Headed Toward Financial Disaster

 

Most everyone deals with money troubles at some point. However, according to American Consumer Credit Counseling (ACCC), a non-profit group, many people may be headed toward financial disaster without even knowing it.

To help determine if you’re in danger of serious financial problems, ACCC offers eight telltale signs:

1. Not paying your bills on time (or at all). Paying your bills late leads to extra charges and can have a significant impact on your credit score. Some companies will even increase your interest rate after just one late payment. Missing bill payments altogether is a big problem–it’ll kill your credit score. Additionally, after three missed mortgage payments, some lenders will start the foreclosure procedure.

2. Struggling to make minimum payments. In most cases, the minimum monthly payment goes toward interest, not principal. Moreover, if you’re struggling to pay the minimum, you probably have way more debt than you can handle.

3. Relying on credit cards too much. Credit scores are partially calculated by your credit utilization. Consequently, being at or over your credit card limit will have a serious impact on your credit score and could lead to denied loans. If you use your credit card to make payments on other bills, you’re playing a high-risk game. Plus, you’ll end up paying more overall because of the credit card interest you accrue.

4. Taking cash advances out on your credit cards. While it may seem like an easy way to get fast cash, taking out a cash advance on your credit cards is a bad idea. Cash advances on your credit card usually come with a transaction fee and are typically subject to significantly higher interest rates.

5. Getting denied credit. Being refused credit is a red flag that you’re on the verge of a personal finance emergency. If you’re denied, it most often means your credit score is extremely low and the company views you as too high of a risk.

6. Living beyond your means. We all know that we should be saving a little each month, and there’s no way you can save if you’re living paycheck to paycheck or, worse, spending more than you earn. Struggling to make ends meet or being in the red month after month is very stressful and can cause major financial problems, especially if an emergency occurs.

7. Dipping into savings or retirement. People dip into their savings and retirement funds for a number of reasons ranging from medical expenses to mortgage loan distress. While pulling from these sources may seem like a good option in the short term, the long-term impacts can potentially be devastating.

8. Tossing out bills. They say ignorance is bliss, but ignoring bills will only lead to heartache. Throwing your bills away before opening them is a clear sign that you’ve given up. While opening the bills may cause you stress, it’s not too late to get a handle on your finances.

By catching these warning signs now, you may be able to avoid serious financial trouble. You can also research and find trustworthy resources available to help you get back on track.

This article is intended for informational purposes only and should not be construed as professional or legal advice

How to Save for Retirement If You're Self-Employed

 

Working for yourself comes with a lot of responsibilities—and funding a retirement plan should be one of them. After all, if you don’t think ahead to your retirement, who will?

Payroll deductions and 401(k) retirement plans set up by employers make it easy for workers at 9-to-5 jobs to contribute to retirement plans. But for the self-employed, it can be more of a challenge simply because there’s no one to do it for you.

Here are some ways to take the process of funding a retirement plan into your own hands:

Traditional or Roth IRAs
If you’re just starting out or saving less than $55,000 a year, a traditional or Roth IRA is a good option. If you’re leaving a job to start a business, you can roll your old 401(k) into an IRA.

As of 2018, the annual IRA contribution limit is $5,500, plus $1,000 catch-up contribution if you’re 50 or older. The Roth IRA has income limits for eligibility, meaning that those who earn too much can’t contribute.

With a variety of differences between the two, depending on your situation, one may prove to be a better choice for you.

For example, a Roth IRA might be best if your business isn’t making much money. While there’s no immediate tax deduction for a Roth IRA, withdrawals are tax-free in retirement when your tax rate is likely to be higher. In addition, a Roth IRA doesn’t require withdrawals at a specific retirement age.

On the other hand, a traditional IRA offers immediate tax deductions on contributions, and ordinary income taxes on withdrawals at retirement must be paid. You must start withdrawing from a traditional IRA when you retire or reach age 70-and-a-half.

Solo 401(k)
For the self-employed or a business owner with no employees, except a spouse, a solo 401(k) plan is a good way to save a lot more money for retirement than through an IRA. A solo 401(k) is like the 401(k) retirement plan you may have had when you worked full-time for someone else but is operated and used by a single person.

As of 2018, the contribution limit is up to $55,000 (plus $6,000 in catch-up contributions if you’re 50 or older), or 100 percent of earned income, whichever is less. Being self-employed basically allows you to contribute to the plan twice, or double the limits in a traditional 401(k) plan, as both an employee and employer.

As an employee to yourself, a solo 401(k) allows you to contribute up to all of your compensation or $18,500, whichever is less. As the employer who administers the plan, you can match contributions of up to 25 percent of compensation.

The tax advantages are the same as a standard, employer-offered 401(k). Contributions are made pre-tax, and distributions after age 50-and-a-half are taxed.

SEP IRA
A Simplified Employee Pension Individual Retirement Arrangement (SEP IRA) is best if you have few employees or none altogether.

The 2018 contribution limit is the lesser of two options: $55,000 or up to 25 percent of compensation or net self-employment earnings, with a $275,000 limit on compensation that can be used to factor the contribution. Net self-employment income is net profit less half your self-employment taxes paid and your SEP contribution. No catch-up contributions are allowed.

For tax purposes, either the contributions can be deducted from your taxes, or 25 percent of the net self-employment earnings or compensation can be deducted. Distributions in retirement are taxed as income.

This article is intended for informational purposes only and should not be construed as professional or legal advice.

What to Do If You Find an Error on Your Credit Report

 

Lenders look at your credit report to determine whether you qualify for a loan or credit card. Inaccurate information could lead to an unfavorable interest rate or outright denial of your application. You should periodically request copies of your credit reports and check them for errors. If you find a mistake, act immediately to have it corrected so it doesn’t hurt your chances of obtaining credit.

How an Error Might Have Occurred
If you have a common name, your records could have gotten mixed up with someone else’s. If you are divorced, a joint account that you had with your former spouse might not have been removed from your credit report, even if it was supposed to be according to your divorce settlement. Someone might also have made an error when entering your personal information. An account might be listed on your credit report more than once, or an account that was closed might not have been removed. In a more extreme scenario, someone might have stolen your identity and opened a fraudulent account in your name.

How to Dispute an Error
Under the Fair Credit Reporting Act, credit bureaus are required to investigate any alleged errors reported by consumers, unless those claims are deemed frivolous. If you find what you believe to be an error, write to the credit bureau or fill out an online form. Explain what you believe is incorrect and provide copies of any documents that support your position. If you send letters via the postal service, mail them certified and request receipt confirmation. Keep copies of all letters you send to the credit bureau and any responses you receive.

You should also contact the company that provided the information to the credit bureau and explain why you believe it is incorrect. Include copies of supporting documents and state that you have filed a dispute with the credit bureau.

Possible Outcomes
The credit bureau should complete its investigation within 30 days. In many states, a consumer who disputes an error is entitled to receive a free copy of a new credit report showing that the mistake has been corrected.

If the credit bureau does not agree that there is an error in your report, you can ask it to include your statement disputing the information in your file. Your statement can be provided to anyone who received your credit report recently or who will in the future. You may have to pay a fee for this service, but it can be worthwhile if it helps you avoid getting turned down for a loan or credit card. If you suffer harm as a result of an error on your credit report, you may need to hire a lawyer to help you resolve the issue.

Check Your Credit Reports
An error on a credit report can prevent you from achieving your financial goals. Request free copies of your credit reports and check them for errors. If you find any, take steps to address the situation as soon as possible.

Healthy Ways to Manage Stress

 

We all have stress in our lives. Busy days at work, problems at home, traffic jams and money trouble are prime examples of stressful situations. However, chronic stress can lead to serious health issues, such as heart disease, high blood pressure and depression, so preventing and managing stress is essential to living happier and healthier.

Here are some tips from the U.S. Department of Health and Human Services to help you deal with stress:

Prepare yourself. Prepare ahead of time for stressful events like a job interview or a hard conversation with a loved one. Stay positive, picture what the room will look like and what you’ll say, and have a backup plan.

Plan your time. Feeling in control of your situation could lower stress. Think ahead about how you’re going to use your time. Write a to-do list and figure out what’s most important–then do that thing first. Be realistic about how long each task will take.

Relax with deep breathing or meditation. These are two effective ways to relax your muscles and clear your mind.

Relax your muscles. Stress causes tension in your muscles. Try stretching or taking a hot shower to help you relax.

Get active. Regular physical activity can help prevent and manage stress. It can also help relax your muscles and improve your mood. Aim for 2.5 hours a week of physical activity. Try riding a bike, taking a walk or lifting weights. Be sure to exercise for at least 10 minutes at a time.

Eat healthy. Give your body plenty of energy by eating healthy, including vegetables, fruits and lean sources of protein.

Talk to friends and family. Tell your friends and family if you’re feeling stressed. They may be able to help.

Get professional help if you need it. Stress is a normal part of life. But if your stress doesn’t go away or keeps getting worse, you may need expert help. A mental health professional, such as a psychiatrist or social worker, can help treat stress-related conditions. Lots of people need help dealing with stress–it’s nothing to be ashamed of.

Home Safety Tips Every Child Should Know

 

Home safety is an important, even life-saving topic that you should teach your children about at an early age. If you educate your children on basic home safety principles when they’re young, the lessons will stick with them for a lifetime.

Learn to lock a deadbolt. Let your children know that the door should always be locked to keep them safe—even when they’re home. However, it’s important they also know how to unlock it in case of an emergency.

Arm and disarm the home security system. With thousands of burglaries happening each day, it’s wise to invest in a home security system. Teach your children how to arm and disarm the system and what to do should it go off when they’re home or sleeping.

Memorize the escape plan. Just like how elementary schools conduct fire drills, it’s important to have an emergency escape plan at home as well. Walk your children through the house to show them the safest exit routes, and designate a meeting place outside the home where family members should gather if an emergency occurs.

Know important emergency contacts. Post important contact information on the fridge or in an easy-to-access location. Teach young children how to use the phone, dial a number and ask for help. This list could include contacts such as 911, Poison Control, parents’ cellphones, a family doctor, or a trusted friend or neighbor.

Never answer the front door. Children should never answer the front door, especially if they’re home alone. Tell children to alert an adult when the doorbell rings.

Don’t climb on furniture. Heavy furniture, such as TVs, bookshelves and entertainment centers, can tip if children climb on them. You can secure these pieces to the wall studs and add nylon straps to increase security. It’s also important to teach children that climbing on furniture is always dangerous—even if safety measures are in place.

Use medicine safely. Store medicine in locked cabinets that are inaccessible to children. However, should children come across any medicine, they need to know never to consume anything unless it’s given to them by a parent or trusted adult.

Young children often imitate the actions and behaviors of their parents and siblings. Practice the safe habits you want them to emulate, and they’ll likely mimic your moves.

Source: Sage Singleton/RISMedia’s Housecall

How to Help Your Kids Build Confidence

 

Children gain confidence by exploring the world around them, trying new things, and learning how to process both successes and failures. The way you interact with your kids on a daily basis can have a profound effect on how confident they feel as they grow up.

Provide Love and Support
The most important ingredient that helps children build confidence is unconditional love from parents. That doesn’t mean that you should agree with everything your children say and let them do whatever they want, but rather, it means that your kids should always know that you have their backs and that you’ll love them even if they make mistakes.

Encourage Your Kids to Try New Things, but Set Limits
Whether you introduce your kids to foods from other cultures or different genres of music, or take them to museums, plays or foreign countries, help them see the richness and beauty of the world around them. If a child expresses an interest in playing a new sport or musical instrument, let him or her try, even if the idea seems to come out of the blue and you think it’s just a passing fancy. Your kids may surprise you by sticking with an interest you’ve never heard them express aloud before.

Letting your children try new things doesn’t mean that you should let them try everything. Kids need rules to protect them, although the rules can change as they get older. Knowing where boundaries lie provides children with a sense of security.

Help Children Succeed and Learn From Failure
Kids will be confident if they know that they’re capable. That doesn’t mean that they’ll do everything perfectly, but everyone has talents, so help your kids find theirs. Encourage them to try things they might enjoy and to keep trying, even if they have a hard time at first. Instead of letting kids set lofty goals that will leave them disappointed, teach them to set realistic, incremental goals. With each accomplishment, their confidence will grow. Offer assistance, constructive criticism and praise whenever appropriate.

A large part of gaining confidence is learning from failure. When your kids are unable to do something, reassure them that everyone fails along the way—and encourage them to try again. They might need to devote more time and attention to a task, slow down, or try an entirely new approach. Frame failure as an opportunity to learn and grow.

Give Your Kids the Support and Freedom They Need
Parents can help children learn to be confident by allowing them to explore while enforcing rules for their safety. Kids gain confidence by knowing that with hard work and determination they can succeed, and that even if they don’t, their parents will love them just the same.

The Best Smart Home Technology for Pet Owners

 

Smart home technology is improving life for everyone, even your furry little friends. These days, there are tons of products available for pets who live in the lap of luxury, from smart feeders that automatically dispense food to treadmills designed for felines.

For those who like to spoil their dogs and cats, here’s the latest and greatest pet technology to bring into your home!

iFetch Too

For some dogs, a quick game of fetch is never enough. If this sounds familiar, then the iFetch might just be for you. This automatic ball launcher will have your pooch running around all day long with up to 300 throws per battery charge. Various distance settings that range from 10 to 40 feet allow you to set it up inside or out, so your dog can chase tennis balls to its heart’s content even when you’re not home. And for the ones who love digging holes, the iDig is also worth checking out!

Little Cat

Is your feline enjoying the cat nip a bit too much? For cats that could afford to lose a few pounds, the Little Cat from PetDing is the perfect solution. Essentially a large hamster wheel with a built-in LED light that cats love to chase after, it’s like an exercise program designed to get your little fur ball off the couch. Available in four different colors, it’ll look great in any house or apartment.

Petcube Bites

There are lots of pet cameras available for those who suffer a little separation anxiety during the day, but the Petcube Bites does more than just let you check in on them. The two-way speaker allows your cat or dog to hear the comfort of your voice when you’re away and you can even reward good behavior with the built-in treat dispenser.

Wagz Smart Door

Nobody wants an unwelcomed visitor coming through the doggy door. Now you can keep out any surprises with the Wagz Smart Door that uses a unique ID tag in the collar that only opens the door for your pets. You can even control when they’re allowed to go outside and use the live HD video camera to monitor any motion around the door.

Family-Friendly Artwork Apps

 

In the age of apps, there’s more to preserving the masterpieces your children create than just sticking them on the refrigerator.

Eventually, the magnets will slip and something that’s dear to you—or your child—could fall off and end up in the trash. If you have the space for keeping their school artwork or homemade projects, you may keep them in plastic containers and sort through them at a later time. But if you’re running out of closet space or are worried that too many of these precious memories will be lost, there are some mobile options that can help you archive them. Here are a few:

Cloud Storage
If you don’t want to keep the physical papers around, take a photo with your phone and store it in the cloud or on your computer’s hard drive. To share them with relatives, put them in Dropbox, iCloud, Google Drive or Microsoft OneDrive. Be sure to protect them with a password that you only give to relatives.

Digital Apps
Photos or videos are the most obvious ways to electronically store these projects, though mobile apps can help you organize and enhance them.

Keepy and Canvsly are two apps that help save and organize children’s art and school projects. Keepy allows audio and video commentary to be recorded while capturing images of a child’s artwork—grandparents and others can be invited to view the artwork, and can comment on it. They also have built-in tools to create and buy photo books and other gift items from artwork you’ve saved.

As with any company, assume it will go out of business one day and that your data will be lost. Keep a digital copy somewhere, or you can also print them out for a photo book.

Custom Printing
If you don’t want to print the artwork through apps, you can either have your smartphone photos printed at Costco or other stores, or go to a custom printing company such as Plum Print to have your photos professionally organized and printed into a book.

Make it Public
If you want to share your children’s art beyond friends and relatives, Artsonia is an online and worldwide student art museum. Upload the artwork to the Artsonia mobile app and you can share it with the world. Not only will your child’s grandparents be bragging about their artwork, but the rest of the world might too.

The Art of Hanging Artwork

 

Hanging artwork is an art—literally. Too high, and the room feels off balance. Too low, and, well…you get the idea.

One of the most common mistakes homeowners make, according to Apartment Therapy’s Eleanor Büsing, is hanging pieces at the wrong level. To help you spruce up your place with properly placed artwork, Büsing offers the following tips:

Establish eye level. Eye level in most houses is approximately 57 to 60 inches from the floor. All artwork, regardless of orientation, should be hung so that the center (not the top or bottom) of the piece is at eye level.

Coordinate with orientation. The orientation of the piece—landscape (horizontal) or portrait (vertical)—should coordinate with the wall space it’ll hang on. The area above a sofa, for example, is horizontal, so the artwork should be oriented landscape.

Portraits can be hung in horizontal spaces, however—the trick is to hang them side by side so that they appear as one horizontal piece. The opposite also applies: Landscapes can be hung in vertical spaces, so long as they’re stacked one on top of the other.

Align varying sizes. A complementary duo or trio of artwork in different sizes should be hung in alignment with the pieces’ center points—this means that the tops of some pieces will be higher than others. Avoid aligning them by their tops or bottoms.

Stay uniform. Multiple pieces of artwork hung improperly can make a room seem cluttered and cramped. Make a gallery uniform by arranging the pieces in a precise grid format with matching frames, or by hanging one “anchor piece” at eye level and hanging other pieces outward from there.

Whichever of these tips you use, consistency is key. Keep eye level in mind as you hang artwork throughout your home to maintain a sense of flow.

Reasons to Cook at Home More Often

 

Some people are overwhelmed by the idea of preparing their own meals, while others are tired after work and stop at a restaurant or order takeout for convenience. Cooking at home is a better choice, and it doesn’t need to take up a lot of time or add to your stress level.

Save Money
Meals prepared at a restaurant will almost always cost a lot more than ones made at home. If you have food delivered, you’ll also have to pay for delivery and a tip. If you make meals yourself, you can buy ingredients on sale and prepare extra so you’ll have leftovers for another dinner or to take to work for lunch.

Save Time
If you go to a restaurant, you’ll have to drive there and back and wait to be served. On a busy night, you may be starving by the time your meal arrives and realize you would’ve been better off whipping something up at home.

You can prepare meals your family loves in large quantities when you have the time and freeze the leftovers. Then, if you get home late or have a particularly stressful day, you can heat something up and have a delicious homemade dinner in minutes.

Eat Healthier
Restaurants tend to use a lot of salt, sugar, butter, oil and other unhealthy ingredients in their food. That can lead to weight gain if you eat out a lot. If you have diabetes, high cholesterol or food allergies, it can be hard to eat healthy at a restaurant. Some establishments are willing to make changes to accommodate customers with dietary restrictions, but others aren’t.

Restaurants also tend to serve portions that are too large for the average person, which can lead to overeating. At home, you can control portion sizes.

Explore Limitless Options
Sometimes you have a craving, but no local restaurant serves that particular dish. At home, you don’t have to choose from a limited menu. You can make whatever you want, whenever you want, and you can alter it to suit your own tastes.

Relax and Learn New Skills
Cooking at home can be fun, whether you do it yourself or with family members. You can explore unfamiliar recipes and ingredients and learn new methods of preparing old favorites.

Even if you don’t know how to cook now, there are plenty of cookbooks, TV shows, and online articles and videos to teach you everything you need to know. You may be surprised by what you can master.

Try Cooking at Home More Often
Preparing your own meals at home can save you money and time and improve your health. Many people also find preparing their own meals an enjoyable way to unwind and spend time with loved ones. If you currently eat out or order takeout most nights, make an effort to prepare more meals at home so you can see the benefits for yourself.