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How Medical Bill Advocates Can Slash Your Costs

By Cheryl Welch

Learn more about Cheryl on NerdWallet’s Ask an Advisor

Being sick is stressful and painful, and high health-care bills only make a bad situation more difficult. It’s even worse when you’re being charged excessively or erroneously. By some estimates, up to 80% of medical bills contain overcharges.

A medical bill advocate can significantly reduce costs for individuals, employers and employees. They do this by reviewing medical bills for abusive, fraudulent and erroneous billing practices.

Benefits for employers

Medical bill advocates offer great advantages to employers:

  • Reduced health plan costs: Lower medical claim costs for employees translate into lower costs for employers.
  • Increased employee productivity: Investigating medical bills can be time-consuming and frustrating. Billing departments are typically available only during business hours, and calling them takes employees away from work. A bill reduction service can free up employee time and eliminate frustrations.
  • Improved employee satisfaction, loyalty and retention: Saving money makes employees happy. Receiving assistance with health-care providers improves their satisfaction as well.
  • Reduced burden on human resources: In the absence of a medical cost reduction service, many employees go to their human resources department with problems. Employers can proactively address employee questions by offering them the right resources.

When you use a medical bill advocate, the amount of the reduced bill plus the commission will be less than the original bill. If an advocate is unable to reduce the patient’s costs, the advocate won’t charge.

Benefits for employees

It’s not only employers that benefit from medical bill advocacy. Besides saving on medical costs, employees receive:

  • Confidential support: Employee data is safe, and all cases are 100% confidential.
  • Time savings: Sorting medical bills and health insurance appeals takes hours. Medical bill advocates handle this so that employees can focus on other responsibilities.
  • Power to make informed decisions: Advocates educate employees to make better health-care choices.
Services offered by medical bill advocates

Services vary by company, but you should look for these benefits:

  • Bill audits: The advocate analyzes bills for errors and overcharges.
  • Bill negotiations: The advocate employs experienced teams that negotiate and reduce out-of-pocket expenses.
  • Insurance claims: The advocate appeals denied insurance claims to ensure the patient is being treated fairly.
  • Education: The advocate holds speaking engagements and one-on-one coaching sessions to improve clients’ understanding of medical costs and plans.
Case study

Let’s look at a real-life example. An employee cut his finger while making dinner and went to a network hospital. He received five stitches from a plastic surgeon. Insurance covered everything except for the out-of-network surgeon. His bill was for $8,500.

Our firm convinced the surgeon to accept the amount paid by the patient’s insurance company as payment in full. That amounted to a 94% discount and a savings of $8,000.

Medical bill advocates provide employers and employees with a simple solution. They connect patients with a team of highly trained experts to take the frustration out of dealing with the medical system. Their knowledge and negotiation skills reduce the stress of sudden illness. This allows patients to focus on what matters most: feeling better.

Cheryl Welch is the president of Hudson Valley Medical Bill Advocates.

How to Find a Good Tax Preparer (and Write Off the Bad Ones)

Tax preparers do a big chunk of America’s tax returns — more than 80 million a year, according to the IRS — but if you’re nervous about handing confidential information to someone in a largely unregulated field, you’re not alone. Here are some tips to help you find a good tax preparer and reduce the risk of expensive errors and exposing your finances.

Decide if you really need a tax preparer

Everyone’s tax situation is different, but many millions of them are simple enough — some W-2 forms from work, mortgage interest or a few other obvious tax deductions — to handle in-house. If that’s the case, it might be cheaper and faster to buy software and do your taxes yourself.

“Obviously the more you have going on, the more I would say go see a preparer,” says Trish Evenstad, president of the Wisconsin Society of Enrolled Agents.

» MORE: The best tax preparation software

If you do need a preparer, be choosy

“I wouldn’t just simply go through the phone book and pick someone randomly,” says Melissa Labant, director of tax policy and advocacy at the American Institute of CPAs. Asking friends, family or colleagues for recommendations can quickly reveal a preparer who’s caused headaches, she said.

Tax attorneys and enrolled agents specialize in or have passed exams on tax rules, and many certified public accountants also specialize in tax preparation. At a minimum, Labant says, a legitimate preparer should have a Preparer Tax Identification Number, or PTIN, from the IRS.

Never assume that because someone works at a big tax-prep company he or she must be an enrolled agent or a certified public accountant, Evenstad warns. And don’t assume a PTIN is valid, either — a 2014 Government Accountability Office study caught some unscrupulous preparers using fake PTINs or ones that didn’t belong to them. You can verify PTINs and professional credentials on the IRS website, and you can check accounting and law licenses on state-level CPA and bar association websites. The National Association of Enrolled Agents also maintains a directory.

» MORE: 7 tips to find the best tax preparer near you

Know what to look for

The IRS requires paid tax preparers to put their name and PTIN on returns they prepare. Not doing so, or asking you to sign a blank return first, suggests a preparer is up to no good, Evenstad said. Directing your refund to a bank account that’s not yours is another red flag. And make sure your return doesn’t say “self-prepared.”

Good preparers will also ask for last year’s return, Labant says. “If they don’t, then you’ll know right away this person is not exercising due diligence and they could easily be missing several key items that need to be reported on your tax return.”

The preparer should provide a secure portal for sending information, too.

“If someone called me and said, ‘Just email me a copy of your driver’s license,’ that would make me a little nervous about how well they’re protecting taxpayer identification information,” Labant says.

» MORE: Tax prep checklist

Report bad apples

If, despite your efforts, a preparer wrongs you, you have a few options. You can complain to the IRS by filling out Form 14157 and sending along supporting documents. Alerting the National Association of Enrolled Agents, the National Association of Tax Professionals and other professional groups might also spark an internal investigation if the preparer is a member, Evenstad says.

Getting restitution, though, might be harder. According to Council of Better Business Bureaus data, just 66 percent of customer complaints against tax preparers in 2015 were resolved — well below the national average of 79 percent across all industries, according to BBB spokesperson Katherine Hutt. By comparison, the cellular industry and banks usually have 98 percent and 97 percent resolution rates, she notes.

“Most of the time, when people are unhappy with a service like that, it’s because they didn’t check out the company ahead of time. Their complaints are usually the same thing that previous customers have complained about,” Hutt says.

If a preparer steals from you, call the police and file a complaint with the IRS.

“If they’ve stolen your identity, you definitely want to turn them in to the [IRS] Office of Professional Responsibility,” Evenstad says. “Because if they’ve stolen yours, they’ve probably stolen other people’s.”

Good preparers who make honest mistakes usually will pay your penalties, though any extra taxes will likely be on you, Evenstad adds.

» MORE: How to detect and report tax scams

Tina Orem is a staff writer at NerdWallet, a personal finance website. Email: torem@nerdwallet.com.

This article was written by NerdWallet and was originally published by The Associated Press.

Mortgage Rates Jan. 23: Lower; Weighing Trump’s FHA and Future Housing Policies

Thirty-year fixed, 15-year fixed and 5/1 ARM rates are all lower Monday, according to a NerdWallet survey of mortgage rates published by national lenders this morning.

Mortgage Rates Today, Monday, Jan. 23 (Change from 1/20) 30-year fixed: 4.41% APR (-0.05) 15-year fixed: 3.80% APR (-0.04) 5/1 ARM: 3.84% APR (-0.02) How will President Trump’s policies impact housing?

With the stroke of a pen just minutes after his inauguration, President Donald Trump reversed some long-standing as well as last-minute initiatives of the Obama administration. One of note immediately impacting the housing industry: the reversal of a 0.25% FHA mortgage insurance premium cut announced Jan. 9.

The premium discount, paid by FHA borrowers to protect lenders in the case of a loan default, was to go into effect Jan. 27.

In a letter announcing the action, General Deputy Assistant Secretary for Housing Genger Charles said more analysis regarding the premium rate cut was required.

“FHA is committed to ensuring its mortgage insurance programs remain viable and effective in the long term for all parties involved, especially our taxpayers. As such, more analysis and research are deemed necessary to assess future adjustments while also considering potential market conditions in an ever-changing global economy that could impact our efforts,” Charles wrote.

Fannie Mae chief economist Doug Duncan believes it’s nearly impossible to predict how future policy changes made by the new Trump administration will impact the economic expansion — and housing — in 2017.

“Incoming data suggest improving consumer spending, diminished labor market slack and advancements in wages, but until we can more clearly read the political tea leaves, it’s difficult to say whether this late-cycle expansion will continue into its eighth year,” Duncan wrote in an analysis.

Fannie Mae expects mortgage rates to rise gradually in 2017, ultimately reaching a fourth quarter average of 4.3%. According to the analysis: “There is risk that rates could rise faster and higher than forecasted, but the impact on housing could be offset by strengthened income growth.”

“We expect housing to remain resilient and continue its recovery in 2017,” Duncan added, “with affordability standing out as the industry’s greatest obstacle, particularly for first-time homeowners.”

Homeowners looking to lower their mortgage rate can shop for refinance lenders here.

NerdWallet daily mortgage rates are an average of the published annual percentage rate with the lowest points for each loan term offered by a sampling of major national lenders. APR quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.

Hal Bundrick is a staff writer at NerdWallet, a personal finance website. Email: hal@nerdwallet.com. Twitter: @halmbundrick.

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Excuses, Excuses When Delaying Retirement Savings

By Gregory S. Ostrowski

Learn more at NerdWallet’s Ask an Advisor

Make no mistake about it, most Americans working in the private sector are on their own when it comes to saving for retirement.

According to a study released in 2013 by the Bureau of Labor Statistics (BLS), as of 2011, only 18% of this segment was participating in a pension (or defined benefit) plan. About two decades prior it stood at 35%, almost double. What’s more, only 10% of private industry firms even offer a pension plan.

Why have once solid pension plans been eroding from the private sector?

One reason is that labor has shifted more to global markets, making it more challenging for companies that employ domestic workers to compete. In developing countries, labor is less expensive and companies often don’t need to pay for pensions.

To remain competitive, firms employing workers in the U.S. have been trying to manage costs, which includes saving on labor. Cutting or eliminating pension plans has been their version of low-hanging fruit.

Problem is, individual Americans have been slow to keep up with this trend and have not shifted the onus onto themselves as much as they need to.

For some, 401(k) plans sponsored by their companies are a good start, but they won’t solve everything.

The BLS reported last year that only 66% of private sector companies offer access to retirement benefits, and only 49% of private sector employees participate.

What about Social Security? Well, it helps, but whether it will keep people in decent financial shape is open to debate.

If you don’t have a pension and have been slow in getting your 401(k) funded, now is the time to start considering other ways to have an income stream for your future self.

Three reasons (OK, excuses) people cite for not saving more earlier in their careers: They can’t afford to; their investments won’t add up to anything; and they don’t know how.

Let’s look at each and offer some solutions.

I can’t afford to save

Expenses. We all have them. Maybe they’re what’s keeping you from putting extra money away. Maybe you feel that you just don’t have any extra to go around each month.

There are financial realities we can’t avoid: housing costs, food, clothing and, for many, student loans. But we don’t have to live in an area we can’t afford or shop at a pricey online retailer for a new pair of jeans.

First take a look at where your money is going. Here are some examples of what the average family (defined by the Bureau of Labor Statistics as a household of 1.8 adults and 1.9 children under 18) spends on different items each month:

● Housing — $1,535 (includes shelter, utilities, furnishings and equipment) (BLS, 2015) ● Vehicle, gas and maintenance — $500 (BLS, 2015) ● Cable TV — $99 (NBC News) ● Smartphones — $140 (J.D. Power and Associates, 2013) ● Netflix — $10 (Standard plan) ● Food away from home — $250 (BLS, 2015) ● Coffee — $92 (Time/The Consumerist, 2012) ● Apparel and services — $155 (BLS, 2015) ● Soft drinks — $70 (Time/The Consumerist, 2012)

These figures may or may not be what you spend. For example, you may not drink soda, so you won’t have any soft drink expenses. But you may spend much more on meals on the go or dinners out.

Also, I haven’t included things like vacations, since they’re more of a one-time purchase per year. But don’t overlook them — there’s real savings to be had if we shop smarter and take more manageable trips.

The idea is to look at each of these categories and ask, “Do I need this?”

Can you drive a slightly less expensive car? Or move to a slightly more affordable area with a shorter commute? You’ll be surprised where you can find money.

Let’s say you can lower your rent by $100 by moving somewhere less expensive, find a better cell phone plan and cable package for another reduction of $50, cut out a few coffees and make dinner at home one extra night for another savings of $50. That’s $200 a month.

My savings won’t add up to anything

Another reason people delay funding their 401(k)s is they don’t believe what they’re investing is going to make an impact.

Let’s go back to our example. If we take that $200 each month and invest it, starting when we’re 25 through the time we’re 65, here’s what we get:

● Annual contributions — $2,400. ● Total years — 40. ● Total principal contributed — $96,000. ● Interest rate — 5%. ● Total interest — $209,000. ● Total principal and interest — $305,000.

So, by moving two towns over, not paying for data you don’t need or shows you don’t watch, and planning meals a fraction more, you’ve managed to create over $300,000 for your nest egg. That’s pretty good.

I don’t know how to save

This is where today’s investing landscape is vastly different from before. The barriers to putting money away are lower than ever, and you don’t need huge sums of cash to give to a broker to buy stock for you.

If you have an employer-sponsored 401(k), start there. Sometimes you’ll get to take advantage of a company match, which is essentially the closest thing to free money you can find. Establishing your 401(k) account is often as easy as a visit to your employer’s human resources office or signing up online.

If you’re struggling with putting anything away, start with even 1% of your income and increase it incrementally. It doesn’t sound like a lot, but it will add up.

If you don’t have access to a 401(k), open an individual retirement account, or IRA. There are numerous IRA providers, so consider consulting a financial advisor to see what options make sense for your personal situation. You’ll need to work other investments into your portfolio over your career, but it’s a great start, especially if you’re just beginning to invest.

If you’re not ready for either, make sure you’re at least putting money consistently into a savings account. While this by itself is certainly not a recommended long-term strategy, it will get you in the habit of putting something away while you’re deciding on your next step.

While there are challenges in saving for retirement, you don’t need to put it off. Start today and your future self will thank you.

Gregory S. Ostrowski is a certified financial planner and managing partner of Scarborough Capital Management.

8 Tips for Refinancing as Mortgage Rates Rise

So you want to refinance, but mortgage rates are rising. Don’t worry — you haven’t missed the boat on your refi opportunity. Mortgage rates are still historically low, and they aren’t expected to exceed 5% in 2017, according to many economists and mortgage analysts.

Here are eight tips to help you successfully refinance your mortgage as rates rise.

1. Make your move fast

Even though rates aren’t expected to shoot through the roof this year, they’ll likely stay on a steady, upward trajectory.

“If you’re thinking about refinancing, now probably is the time to do it,” says Lauren Lyons Cole, a certified financial planner and money editor at Consumer Reports, adding that rates are probably not going to be lower than they are right now.

It’s worth doing your research to see what rate you can get and then acting swiftly before it’s too late.

» MORE: Calculate your refinance savings

2. Prepare in case rates drop

You’ll want to get your refinance application in as soon as possible, not only to catch low rates before they rise, but also to avoid a backup in refinance applications should rates suddenly fall, according to Casey Fleming, author of “The Loan Guide: How to Get the Best Possible Mortgage.”

“This is the biggest mistake I think people make,” Fleming says. “If you’re not in the pipeline ready to go when the interest rates start moving down, all of a sudden you have to get in the back of the line, and oftentimes you miss the dip in the rates.”

Fleming says that you’re not obligated to lock in a rate when you submit your application. You can wait and watch the market for as long as you want.

If you’re not ready to submit your application just yet, work on keeping your credit score up, have your financial documents ready to go, and save money for the upfront refinancing fees. Just remember that rates are rising slowly but steadily.

3. Make sure your credit score is in good shape

Acting fast on a refinance may not be worth it if your credit score isn’t in top shape. Your credit score plays a big part in the rate you can get on a mortgage. Just because low rates are out there doesn’t mean you’ll qualify for them.

Lyons Cole says that, in some cases, your credit can be easily bolstered. “I’ve seen people’s scores go from the 500s up to the 700s in about three months just from [quick changes] on your credit report.”

Some ways that you can work on your credit include checking your credit report for errors, paying your bills on time and keeping a safe distance from your credit limit.

“Mortgage rates aren’t going to go up a full point between now and the next three months,” Lyons Cole says. “Taking the time to get your credit score to a place where you qualify for the best possible rate could make a huge difference over the course of a 30-year mortgage.”

4. Use rising home prices to your advantage

Along with rates, home values are rising. Now might be a good opportunity for you to tap into your home’s equity through a cash-out refinance. If you do so, proceed with caution. It’s risky to spend the proceeds from a cash-out refi on things that don’t rebuild your equity, like a car.

You can also access your home’s increasing value through a home equity loan or home equity line of credit.

5. Refinance into an ARM

Refinancing into an adjustable-rate mortgage in a rising rate environment can make sense since these loans tend to come with lower initial interest rates than fixed mortgages. They’re especially useful if you plan on staying in your home no longer than the fixed term of the loan.

Jenny Erdmann, a certified financial planner and vice president of Guide My Finances in San Diego, says that as long as an ARM makes sense for you and you’re aware of the drawbacks with this type of loan — like the possibility that your rate may eventually increase — you should try to get the lowest rate you can.

6. Refinance to a shorter term

Refinancing into a shorter-term fixed-rate loan can save you money in two ways: the interest rate is lower than a 30-year fixed-rate loan, and the shorter term means you’ll save more money over the life of the loan by paying less interest.

Here’s an example: Using NerdWallet’s refinance calculator, we plugged in the numbers for a 30-year, $300,000 mortgage taken out in 2010 with a 4.75% fixed interest rate. We refinanced it to a 15-year mortgage with a 3.50% fixed interest rate. Savings equated to $52,975 over 15 years. While your original monthly payment of $1,565 would take on an extra $311 each month, you would save more money in the long run and build equity faster.

Take into account that if a 3.50% interest rate went up a quarter of a percentage point, your savings would decrease to $47,145 over a 15-year period, and your monthly payment would increase by $344.

7. Pay points

Before your loan closes, you’ll have the option to pay points on your mortgage, which is paying money upfront, to permanently lower your interest rate. Fleming says that “if the additional cost makes sense, then absolutely pay points.”

While one point equals 1% of your loan amount, you won’t always have the option to pay in full points. The amount of money you have to pay to buy down your rate depends on the interest rate market, according to Fleming. He says that if the market is volatile, then you’ll probably have to pay more to buy down the rate. But if the market is stable, then you’ll pay less. Fleming says that it might make sense for you to wait until rates stabilize so you can pay less.

8. Refinance out of an ARM, HELOC

If you’re concerned about the interest rate rising on your adjustable-rate mortgage or on your home equity line of credit, refinancing to a fixed-rate product can allow you to lock in a new rate to make your monthly payments more predictable.

Fleming says that borrowers with a HELOC should watch out for the recast period. That’s when the draw period ends and you can no longer pay just the interest on the loan. Since rates are increasing, “anybody with a HELOC should definitely look at their options,” says Fleming.

Your options include calling your bank and seeing if you can switch your HELOC to a fixed rate, though the rate may go higher if you do. You can also refinance the HELOC into a home equity loan at a fixed rate. Another option is to refinance your first mortgage and wrap the second mortgage into it. However, Fleming says if you end up refinancing to a higher rate, this strategy wouldn’t make much sense.

Michael Burge is a staff writer at NerdWallet, a personal finance website. Email: mburge@nerdwallet.com.

Investing Apps Can Foil Financial Planning

New investors need at least two things: money and confidence. But many beginners, especially younger people, lack both.

What they do have are investing apps, carefully designed to plug those holes by removing minimum investment requirements and adding a little encouragement. One company, Acorns, will literally invest your small change.

These apps bring what has historically been a rich person’s game to the masses — fund companies, brokerages and financial advisory firms have long locked out small-dollar investors. The problem: Many people may not be ready to invest, and if they are, an investing app alone isn’t the best place to do it.

Ignoring the financial big picture

Advisors frequently compare financial planning to building a house: First, you lay the foundation — an emergency fund, insurance coverage and a balance sheet free of high-interest debt. An app can upend that, says financial technology expert Bill Winterberg.

“For these apps, the answer to the question of ‘what should I do with my money,’ 100% of the time, is that you should invest. An advisor, on the other hand, says, ‘Should you pay down debt? Do you need more insurance coverage? Do you have enough money in an emergency fund?’” Winterberg says. “Those might be really good ways to use extra money.”

Acorns, which rounds up dollar amounts from users’ everyday purchases and invests that change in a managed portfolio, says its technology reframes this issue. By focusing on extra pennies, investing “can happen alongside traditional financial building blocks,” says Heather Gordon, the app’s brand manager.

The scenario Gordon describes is the best way to use these apps; investing rounded-up change or another small amount is innocuous and even helpful as an educational exercise. But Acorns says over half of its users make recurring investments beyond the rounded-up amounts. Other apps, like Robinhood, which offers free stock trading, and Stash, which serves educational content to help users build a portfolio of exchange-traded funds, accept only traditional lump deposits.

Erica Bentley, content manager for Stash, says the service isn’t trying to answer all financial needs. “It would be great if [users] started with paying off debt, or having an emergency savings account built up, but for a lot of people Stash is the first entrance into thinking about saving, and with our content, they learn they should also be considering an emergency savings account.” The question is whether a service like Stash is well-suited to being that first entrance.

Shortchanging retirement accounts

Much as in financial planning, there’s a widely recommended order for how to invest your dollars: Tax-advantaged options, like 401(k)s and individual retirement accounts, come first.

The paradox is that as investing apps target young, beginner investors, many offer only taxable brokerage accounts, directing dollars away from the tax-free or tax-deferred growth of traditional and Roth IRAs.

“If they’re directing these investors to a traditional brokerage account, it doesn’t have those tax advantages, and over time, that could compound to tens of thousands of dollars — potentially hundreds of thousands of dollars if we have a bull market,” says Winterberg.

Acorns and Stash both plan on adding retirement accounts in the next year.

Understanding the risks

Apps typically use a questionnaire to identify an investor’s goals, time horizon and appetite for risk. But “even the process of asking people about their risk tolerance doesn’t have much follow-up to verify that the person — who may be new to investing — really understood the questions, and the risks involved,” says Michael Kitces, director of wealth management at Pinnacle Advisory Group.

Robinhood adds additional risk with “Robinhood Gold,” a fun name for margin trading, or the ability to buy stocks on borrowed money. Robinhood says the service, which charges a flat fee, is reserved for “experienced investors” — federal regulations require a $2,000 account minimum — but the app is bare-bones and provides little education about the risks besides a disclosure and an FAQ. In this kind of trading you can lose more than you’ve deposited.

Margin trading is offered by many brokers, who frequently charge interest rather than Robinhood’s more user-friendly fee. Robinhood says its app is used by many investors as an “educational experience” — but engaging in margin trading could quickly make it a costly one.

Fees drag down small portfolios

Finally, there are the fees. Robinhood offers free trading if users avoid the aforementioned margin activity, and Acorns is free for college students. Otherwise, Acorns and Stash have the same fee structure: $1 a month for accounts under $5,000, and 0.25% per year for accounts of $5,000 or more.

Neither service communicates that flat fee to users as a percentage of assets — which is how most investments are priced — but when sliced that way, $1 a month is 2.4% a year on $500, much more than a financial advisor would charge.

The argument from these apps is that most financial advisors and even online brokers won’t handle an investment as small as $500. Even if a broker has no deposit requirement, mutual fund minimums are rarely under $1,000. And that may be by design.

“People who don’t have $1,000 to invest are people who don’t have $1,000 to invest, and there’s a reason for that,” says Winterberg. “They may be spending more than they earn, or they may have credit card debt. Perhaps investing isn’t the right choice for them right now.”

More from NerdWallet

The Best Ways to Invest $1,000

401(k) Calculator

Best Robo-Advisors

Arielle O’Shea is a staff writer at NerdWallet, a personal finance website. Email: aoshea@nerdwallet.com. Twitter: @arioshea.

This article was written by NerdWallet and was originally published by USA Today.

Retirement Advice From Retired Financial Experts

Most retirement advice has a flaw: It’s being given by people who haven’t yet retired.

So I asked money experts who have quit the 9-to-5 for their best advice on how to prepare for retirement.

They still faced curveballs when it was their turn. Making the right financial moves is important, they said, but so is getting ready mentally, emotionally and socially.

You can’t plan for everything

A central retirement decision is when to do it. Working longer can reduce the odds of running out of money, but delaying retirement too long could mean missing out on the good health or companionship to fully enjoy it.

That trade-off came home to financial planner Ahouva Steinhaus of San Diego when her life partner, Albert, died suddenly last year, just before she was scheduled to hand over her business.

Steinhaus, 69, says she’s grateful she’s not working now, while grieving the loss, but still wonders what might have been if she’d started the process of selling her practice earlier.

“You can’t know those things,” Steinhaus says. “It’s a balance between wanting to make sure that you have enough socked away that you feel confident that you’re going to be OK, and not wanting to spend the rest of your life working.”

What helps, Steinhaus says, is having many supportive friends and projects. She’s remodeling her kitchen after wanting to do so for 18 years, and she’s active in various causes, including San Diego EarthWorks. She also knows from having watched her clients and friends that adjusting to retired life can take a while.

“It does seem like a lot of people do cast around a bit after they retire to figure out what their life is going to look like,” Steinhaus says.

Get your retirement house in order

Theoretically, you can get a better return investing your money than paying off a mortgage. In reality, your biggest asset in retirement could be a paid-off, appropriately remodeled home that allows you to age in place, says financial literacy expert Lewis Mandell, emeritus professor of finance at the State University of New York, Buffalo.

Not having a mortgage allows you to withdraw less from your retirement accounts, which could make them last longer, and your equity could be a source of income later through a reverse mortgage, says Mandell, 73, who wrote his latest book, “What to Do When I Get Stupid,” after moving to Bainbridge Island in Washington.

If you plan to relocate, spending time in your new community before you retire can help you acclimate. Financial planner Bill Bengen and his wife, Joyce, at first divided their time between their home in San Diego and their vacation house in La Quinta, California. They wound up moving five years before they retired.

“We feel plugged into the community now,” says Bengen, 69. When moving to a new area, he says, “it’s strange: You don’t know anybody, you don’t know the ropes. Now we’re part of the ropes.”

Find an objective advisor

Bengen has not one but two advisors: an investment manager and a financial planner. He appreciates their objectivity — and the fact that he doesn’t have to fret over the details.

An objective review of your retirement plans is crucial before you retire, since the decisions you make in the years immediately before and after may have irreversible consequences, planners say. A too-large withdrawal rate, for example, can increase the chances of running out of money. (Bengen should know: His research led to the “4% rule” widely used in financial planning to determine sustainable withdrawal rates.)

Find ways to stay connected

Peggy Cabaniss of Moraga, California, learned from retired clients that staying active in a field where you’re recognized can help prevent the feeling that you’ve lost part of your identity.

“It’s really easy to become a nobody,” says Cabaniss, 72.

Cabaniss counsels other planners about selling their businesses, serves on the boards of three nonprofits and works on a committee that encourages more women to become financial planners.

Cabaniss’ big surprise is how much she’s enjoying her new life. Before she retired, Cabaniss thought her work wasn’t stressful, because she loved it. Within a few months of selling her practice, though, she noticed her shoulders were in a new position — down where they should be, instead of tensed up around her ears.

“I didn’t realize that I felt such a great deal of responsibility,” Cabaniss said. “Now my kids say, ‘Mom, you look so happy.’”

Liz Weston is a certified financial planner and columnist at NerdWallet, a personal finance website, and author of “Your Credit Score.” Email: lweston@nerdwallet.com. Twitter: @lizweston.

This article was written by NerdWallet and was originally published by The Associated Press.

What TCF Bank Suit Means for You: Defend Against Overdraft Fees

When your checking account reaches zero, you may be safe or sorry depending on whether you have to pay overdraft fees. While these fees are common, a government watchdog says one bank may have gone too far in pushing them to its customers.

The Consumer Financial Protection Bureau is suing Minnesota-based TCF Bank, accusing it of misleading customers into signing up for costly overdraft services.

TCF Bank “designed its application process to obscure the fees and make [overdraft protection] seem mandatory for new customers to open an account,” the consumer watchdog said in a news release on Thursday. The agency also claims that TCF Bank opted existing customers into their overdraft service with a “loose definition of consent.”

TCF rejected the claims in a statement, saying, “We believe that at all times our overdraft protection program complied with the letter and spirit of all applicable laws and regulations, and that we treated our customers fairly.”

TCF Bank operates 341 retail branches in Minnesota, Wisconsin, Illinois, Michigan, Colorado, Arizona and South Dakota.

You can protect yourself from overdraft fees at your bank, but the language can get a little tricky.  Here’s what you need to know to avoid them.

» MOREOverdraft fees: What banks charge

How overdraft services work

Overdraft protection kicks in when your bank account doesn’t have enough money to cover transactions. It includes two services that sound similar but differ greatly in cost.

With “overdraft coverage,” in exchange for a fee, a bank or credit union pays a transaction with its money when your checking account doesn’t have enough cash to cover it. This also may be known as “overdraft courtesy.”

When the bank fronts you the money, overdraft fees can be charged multiple times in a single day. The median overdraft fee is $34, according to the CFPB.

Transactions eligible for overdraft protection coverage are ATM withdrawals, debit card purchases, checks and online bill payments.

With “overdraft transfers,” an institution pulls your money from a linked account and puts it in your checking account to cover transactions. Some banks do this for free; others charge $10 or $12, but it varies by institution.

» MORE: How overdraft transfers work

What ‘opting in’ really means

A bank or credit union can’t charge overdraft fees on ATM and most debit card transactions unless you affirmatively “opt in” to the service, according to the Electronic Fund Transfer Act and Consumer Financial Protection Act of 2010. According to the CFPB, accounts that are opted in are three times as likely to have more than 10 overdrafts per year than accounts that are not opted in.

If you don’t opt in, the institution doesn’t cover purchases that would overdraft your bank account, and your transaction is declined. If you’re in an overdraft program, you can “opt out,” or cancel it.

Adding another wrinkle, you may still be charged for bounced checks and other transactions such as online bill payments. These costs — known as nonsufficient funds fees — can be charged regardless of whether you have overdraft protection.

How to minimize overdraft fees

Even the most careful customer’s account may run low occasionally. Minimize the fees by taking the following steps:

  • Set up electronic alerts: Get phone or email notifications when your balance is running low.
  • Add a cash cushion: Keep extra padding in your checking account to avoid overdrafting.
  • Don’t opt in: Purchases will be declined when you don’t have enough money, but you won’t incur overdraft fees, either. If you already have overdraft coverage, you can still opt out.
  • Create a safety net: Link your savings account or a line of credit to your checking account for cheaper or free overdraft transfers.
  • Shop around: Do you overdraft frequently? Switch to a bank or credit union that offers free overdraft services.

If you’re still confused, ask as many questions as possible until you understand your bank’s terms. By taking the necessary precautions, you can prevent your $6 fast-food debit swipe from turning into $34 or more in fees.

Melissa Lambarena is a staff writer at NerdWallet, a personal finance website. Email: mlambarena@nerdwallet.com. Twitter: @LissaLambarena

Sean Talks Money: How to Overcome a Holiday Debt Hangover

Odds are your recent holiday shopping carried some kind of stress. Maybe you agonized over finding the perfect gift for a dad who already buys himself everything he needs. Maybe you waited until the eleventh hour and had to sweat out a shipping deadline or battle throngs of fellow procrastinators in the stores.

Or maybe you were just more generous to your loved ones than your wallet could afford.

According to a 2015 holiday spending survey, people in relationships are willing to take on an average of $200 in credit card debt to buy gifts for each other, and that number is likely higher when accounting for gifts for children and others.

If that was the case for you, don’t let the stress of holiday-related credit card debt linger.

Know your pain points and how to massage them

If you took on debt to pay for the holidays, the pain of your debt hangover is largely determined by where your debt sits — that is, whether you charged it to your everyday credit card, used a store credit card or put it on a card with a low (preferably 0%) annual percentage rate offer. Ideally it’s that last one, because it means you also bought yourself some time.

But if you used your everyday credit card, whether for cash back or travel rewards, you’re potentially paying an average of around 19% in interest annually. That can get costly, depending on how expensive your holiday tally was and whether it added to a balance you were already carrying. If you’re getting buried by interest charges on that card, explore your options for debt consolidation. More on that later.

>>MORE: NerdWallet’s best balance-transfer and low-APR credit cards

If you used a store credit card, make sure you understand what you’re on the hook for, and when. Many store cards may allow 0% financing through a “deferred interest” offer, which sounds similar to a 0% APR introductory offer you might see from a general-purpose credit card — but it’s not the same thing. “Deferred interest” means you’ll potentially still owe withheld interest after the introductory period closes, and these cards also can come with a raft of additional complications. Contrast that with 0% offers from banks, which waive interest charges outright for the introductory period.

You can avoid deferred interest charges if you pay off the debt before the introductory period closes. I’m aiming to do this myself. Last spring I bought an iMac in an Apple Store on a deferred interest offer. To avoid those future interest charges, I’m paying back enough every month to get me in the clear with a few months to spare.

Clean up the mess

Wherever your holiday debt sits, you need a plan to pay it off. I recommend three steps:

1. Recognize that you have the debt and that ignoring it won’t make it disappear. That doesn’t mean shaming yourself. There’s nothing wrong with spending money on yourself or others, especially during the holidays. But the debt is there, and before you can tackle it, you have to acknowledge it.

2. Take action. That means making the minimum payments on your credit card bills — and then paying more. To cut down on the interest owed, I recommend paying at least two to three times the monthly minimum payment, with a target of paying off holiday debt in three months or less. Fortunately, this is a good time of year for that strategy: The holiday season and the months that follow it may provide predictable windfalls, like cash gifts, year-end bonuses and tax refunds. Use those to start digging out.

If you have a sizable amount of debt and your credit score is at least “average” — above 630 or so — you could use a balance-transfer credit card to consolidate your debt onto a 0% offer. Doing so will save you a lot of money in interest payments.

3. Don’t give up. Paying off debt, especially if you’ve accumulated a lot of it, takes time. Look for opportunities to cut unnecessary costs, especially recurring expenses you might no longer value, like an old gym membership or online or app subscriptions. To boost your income, try picking up extra work hours or a new side gig.

>>MORE: 10 financial tips for the new year

Dealing with a holiday debt hangover may require humility, some creative financial adjustments and patience. But the trade-off can mean more financial freedom, and that’s one of the best gifts of all.

Sean McQuay is a credit and banking expert at NerdWallet. A former strategist with Visa, McQuay now helps consumers use their credit cards and banking products more effectively. If you have a question, shoot him an email at asksean@nerdwallet.com. The answer might show up in a future column.

Mobile Money Apps: Tech Helps Teach Kids to Save

Even the iconic piggy bank is getting a digital makeover.

Feeding the piggy has long been a down-homey, tried-and-true way to teach kids how to save money. Now, these lessons increasingly can be found on smartphones and mobile money apps designed specifically for children.

And why not? The average age for kids to get their first smartphone is about 10, according to research firm Influence Central, so money apps connect with kids in their comfort zone.

» MORE: NerdWallet’s best savings accounts for kids

“It’s where they are and what engages them,” says Ted Gonder, co-founder and CEO of Chicago-based Moneythink, a nonprofit that mentors young people and helps them adopt positive financial habits. Moneythink develops money apps to use as teaching tools, having found they can be more effective than dry lectures or drier textbooks.

There are a few wrinkles in their approaches, but most money apps for kids act like virtual banks, offering lessons on how to budget and sock away money for spending goals. They tend to emphasize child-parent interaction; a common feature tracks chores the child needs to accomplish before receiving an allowance from parents.

A few banks also offer apps for kids. Parents retain control and children can’t actually make financial transactions, but the same money lessons apply.

Most apps, however, fail to address the most important consideration a parent should have when teaching a child about money — making a distinction between wants and needs, says John Buerger, a financial planner and president of Altus Wealth Solutions in San Luis Obispo, California.

“All we’re looking at in most app cases is, ‘You work, you get paid for your allowance,’ and that may be problematic from a philosophical standpoint. Your chores are your chores [and] you do them for your family,” Buerger says.

Still, Buerger praises financial literacy apps for starting conversations with kids about money. “I like kids paying attention to money as early as 5 or 6,” he says.

If you’re looking for a financial education app for your child, Buerger advises picking one that incorporates interactive features or gamification to help hold a kid’s interest.

James DeBello, CEO of mobile deposit technology company Mitek in San Diego, has another take: Keep it simple. The best apps “require fewer steps to get from point A to point Z,” he says.

Here are five highly rated financial education apps vying for your child’s attention — and yours — in a growing and crowded digital field.

Bankaroo

Bankaroo — developed in 2011 by then-11-year-old Dani Gafni and her father, Etay —  helps children track their savings and what their parents owe them for chores. Designed for kids ages 5 to 14, the free app features tools for learning how to budget, save, set goals and do basic accounting.

Bankaroo, available for iOS, Android and Amazon devices, says it has about 100,000 users in more than 100 countries. In April, it released a new version of the app in Spanish.

iAllowance

The iAllowance app is another one in the vein of allowance trackers for parents and their kids. It’s not free — and available only on iOS for $3.99 — but iAllowance has some handy features not found in other apps.

Parents can push alerts to children to get chores done, and set up automatic allowance payouts and rewards when kids meet certain goals. They also can create an unlimited number of piggy banks for each of their kids.

PiggyBot

Also built around the idea of a virtual banking, allowance-tracking platform, PiggyBot is aimed at kids ages 6 to 8. It has some neat features, such as the ability to post photos of things your children want and a screen to show off the things they’ve purchased, giving them an idea of their goals and rewards. The app’s developer says it reinforces principles of saving.

Piggybot was developed in association with Kasasa, a national brand of free checking and savings accounts that works with community banks and credit unions across the country. Piggybot is free, but available only on iOS.

Yuby

An offering from Union Bank for children ages 6 to 11, the Yuby app lets them track their earnings, spending and the chores they need to do to earn their allowance. The free app is a virtual experience only, and no financial transactions occur. It’s available in iOS and Android.

Children also can keep a wish list and compare the costs of the things they’re saving for. Another feature allows earmarking of money for charity. A parent’s approval is needed for some actions.

USAA Bank’s mobile app

This members-only bank doesn’t have a special app for children, but it allows kids ages 13 and over to access their youth savings and spending accounts online and on the bank’s regular mobile app with their parent’s approval. The free app is available for iOS and Android devices.

Some app features, such as USAA Money Manager, which categorizes spending,  aren’t accessible to children under 18, and parents control other features they wish to extend to their child, such as remote check deposit.

“This comes down to teaching the basics of banking in a real-world scenario,” says Brian Hurtak, an executive director with the bank. USAA is open only to active and former military members, their families, and cadets or midshipmen.

Juan Castillo is a staff writer at NerdWallet, a personal finance website. Email: jcastillo@nerdwallet.com. Twitter: @JCastilloNerd.

This article was written by NerdWallet and was originally published by USA Today.

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