How to use your home equity in retirement

(BPT) – Most of us save and plan for decades to enjoy the period of our life when we no longer need to go into the office and work an eight-hour day for a paycheck.

But even with those decades of hard work, it can be tough to save up enough cash to cover all your costs in retirement. Many soon-to-be-retirees face a shortage between what they saved for retirement and what they actually need to live on.

For homeowners, that may be a problem that’s relatively easy to solve. Tapping into the equity in your home can help you stretch your nest egg quite a bit further.

Use a home equity loan or line of credit

You can tap the equity in your home with a home equity loan or a home equity line of credit (known as a HELOC). A home equity loan works like most other loans: you agree to borrow a set amount of money, receive a lump sum, and pay that back with interest and in installments each month.

A HELOC works a little differently, because it’s not a loan with pre-determined monthly payments. Instead, it’s a revolving line of credit, similar to a credit card. You usually have between five and 25 years to borrow against a certain amount of equity and repay (with interest) whatever you take out.

The time during which you can use the HELOC is called the draw period. The line of credit revolves during this period, so you can borrow and repay the balance multiple times. The total amount is due back in full with interest at the end of the draw period. Any time you have an amount outstanding, you will make monthly payments.

You can use a HELOC or home equity loan during retirement, but remember that you will need to pay the money back. You should have a plan in place for how to repay the funds — and the interest — before you agree to take a loan or a line of credit on your home.

Use a home ownership investment

A home ownership investment is a powerful way to unlock some of the equity in your home without taking out a loan.

The Unison HomeOwner program can unlock up to $500,000 of your home equity and the money can be used for anything you want — including paying monthly expenses, paying off debt or making home improvements. Because it’s a home ownership investment, not a loan, there are no monthly payments and no interest charges. Learn more at www.unison.com/homeowner.

Unison invests in the home alongside you. In return for the company’s investment in your home, they receive a portion of the future change in the value of your home. Unison shares both the upside and downside risk with you. When you choose to sell your home, up to 30 years later, if the home value rises, both you and Unison share in the appreciation. If the home value falls, both you and Unison share the loss.

Consider a reverse mortgage

A reverse mortgage can allow homeowners 62 years or older to turn equity in their homes into cash in a way that provides them with the income they need through retirement. You can get your cash in a lump sum or in monthly payments, or in a line of credit.

But it’s important to remember that a reverse mortgage is still a loan that comes with origination fees and interest charges. It requires that you have no other debt on your property, so if you have an existing mortgage loan, you will have to repay that in full from the reverse mortgage proceeds. You will also need to pay the reverse mortgage loan back when you move out of the home, sell it or pass away.

A reverse mortgage can give you income in retirement and whenever the home is sold, the money is used to pay off the loan. However, reverse mortgages can cause a lot of trouble if you’re not careful, and the high fees that you incur when you sell the home can leave you in a worse financial position than if you skipped the reverse mortgage altogether.

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5 Investment Strategies That Can Outlast Market Spikes

(BPT) – You’re familiar with the saying “If it seems too good to be true, it probably is”?

Just like any other scheme to “get rich quick,” attempting to buy low and sell high based on intermittent fluctuations in the stock market—also known as “market timing”—is almost always a losing proposition over the long term for the investor. Studies have repeatedly shown that those who attempt to align their investments with short-term fluctuations earn less than those who stay in over the long haul.

“Once again, market fluctuations are messing with average investors’ minds,” says J.D. Roth, author of “Your Money: The Missing Manual” in Entrepreneur. “They panic and sell when prices drop, then fall victim to what Alan Greenspan in 1996 called ‘irrational exuberance’ and buy when prices soar. That’s a sure way to lose money.”

The truth is that even the most stellar investment advisor lacks a crystal ball into the future, and can only make recommendations based on historical research, industry guidelines, and experience. Unfortunately, past performance in the stock market is not at all an indicator of future performance.

So what are some better guidelines for investing in the stock market? Consider the following sound strategies, built on the mounds of evidence saying market timing doesn’t work as a long-term strategy:

1. Establish a long-term plan.

Set clear goals and objectives such as funding children’s college educations or investing for your own retirement. An advisor can help you evaluate risks, decide on asset allocation and set benchmarks for success while minimizing risk.

2. Use dollar-cost averaging.

Instead of trading when you think it’s the right time, the principle of dollar-cost averaging (DCA) says to invest a fixed dollar amount at predetermined intervals. The result is that you’ll end up buying fewer shares when prices are high and more shares when prices are low.

The advantage of dollar-cost averaging is that you put your money into the market earlier—increasing the likelihood of price change—rather than holding onto cash until you think prices are low. Regardless of whether you have a flat, positive, or negative price return, if your investments earn dividends, dollar-cost averaging is a useful strategy for earning dividend returns.

3. Ride the market by tracking an index and optimize your costs.

Trying to achieve alpha—i.e., beating the market with price returns—isn’t necessarily the most evidence-based way of getting the highest returns over time, especially looking at your returns net of costs and taxes.

By investing in funds that largely track a market index (index funds), historical results show that the lower fees typical of index funds and the long-term gains often outperform actively managed funds with higher fees. Investors should always focus on what they take home over the long term after fees and taxes. Looking purely at the price return can lead to lower-than-expected results.

4. Be aware of tax implications.

A major reason why investors should lean on professional support in today’s world is so that they can optimize their investments to lower taxes. Specifically, how assets are located within tax-advantaged and taxable accounts can be managed to lower your tax liability. Also, investment losses can be “harvested” via a process called “tax-loss harvesting,” and that’s generally a process many investors cannot do themselves.

Finally, any time you want to reinvest dividends or have reason to switch to a different investment, there are ways to make regular transactions as tax-efficient as possible. The same goes for making your eventual withdrawal. This kind of back-office tax work can have a major impact on how much you, as an investor, keep from your investment, so it’s important to find the right solution—whether that’s a financial advisor or learning to do it yourself.

5. Stay skeptical.

When it comes to outlasting a spike in the market, any investor should be aware of their own biases and behaviors. Pay little attention to financial TV shows and other media reports that hype short-term fluctuations. And be cognizant of the speaker’s motivation. Those who think they have a real get-rich-quick scheme are unlikely to share it with others.

Above all, don’t let uncertainty stop you from investing. If you look back all the way to 1926, keeping your money in cash/cash equivalents has underperformed both bonds and stocks. The key thing is to just get invested.

Betterment optimizes its technology and experience to help you make informed decisions in your investment strategy. Founded in 2008, the company manages $9 billion in assets. Investing in securities involves risks, and there is always the potential of losing money when you invest in securities. Before investing, consider your investment objectives and Betterment’s charges and expenses. Betterment distributed this article through Brandpoint. Visit Betterment.com for more information.

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7 tips for balancing retirement savings and paying for college

(BPT) – Most people want to help their children pay for a quality college education, but it can be difficult to balance personal financial goals and funding your kids’ educational aspirations. When retirement savings is sacrificed for college costs, it can be a disservice to the entire family.

To help guide you in determining the best way to pay for your kids’ college while still funding your retirement savings, personal finance expert and host of the So Money podcast Farnoosh Torabi offers seven smart tips.

Tip 1: Don’t put retirement on the back burner.

While funding your children’s college education is important, your retirement savings should take priority. Strive to contribute 10 to 15 percent of your take-home pay toward retirement savings. The reality is college is four years and retirement can be 30+ years. Plus, there’s no scholarship for retirement like there is for college!

Tip 2: Take the free money.

If your workplace retirement plan comes with a match, take it. Contribute the minimum to receive your employer match. At the end of the day, it’s free money and that’s the best kind.

Tip 3: Involve your children in the college cost discussion.

College is expensive, so make sure you’re discussing with your kids overall costs and what you’re willing to contribute. Have them help research financial aid and scholarship opportunities, too. Remember, you want to find a school that’s the best fit — so don’t let the initial “sticker price” scare your children from applying. Some private colleges may give the best aid packages, but other times they may not. Don’t make assumptions and always keep your options open. The goal is to find the college with the best value.

Tip 4: Don’t take on more than you can afford.

While involving your children in the discussion, it’s also important to make sure you’re not setting them up for failure when they graduate. As they research student loan possibilities, make sure they’ll be able to comfortably afford payments once they graduate, and that they’re not taking on too much debt.

An easy way to start researching together is to visit College Ave Student Loans and use the configure-it-out tool. Answer a short series of questions regarding how much you’ll borrow, how many years of schooling are left, whether you want to make payments during school or not, etc. This shows your child what repayment will look like under each option so you can both be clear on the details and agree on a game plan.

Tip 5: Consider the college savings plan that’s best for you.

Consider opening a 529 that allows flexible spending toward higher education. Should your child choose to forgo traditional college education or not require the funds set aside, you can easily change the beneficiary to another child or relative.

If you’re skeptical of a 529, consider a Roth IRA if your income limits allow. Although typically used for retirement, the Roth IRA has an exception where you can withdraw your contributions from the account at any time tax- and penalty-free for qualified education expenses. The remaining money can be collected in your retirement.

Tip 6: Starting late? Play catch-up.

If saving for retirement has not been a priority, it’s time to get aggressive. Pare down costs where possible and take advantage of catch-up contributions. People who are 50 or older can contribute an extra $6,000 to their 401(k) or an extra $1,000 to an IRA this tax year.

Tip 7: Don’t become the “bank of Mom and Dad.”

You want to help your kids, but once you set the precedent that it’s OK for your children to ask for money (or a contribution toward college), they may feel they can frequently approach you later in life for funds. Don’t set the tone that you’ll always be there to financially support them. You want them to grow wings so they can fly independently (and so you can happily enter retirement and enjoy those golden years).

While you should talk with your child about potential majors and career paths, it’s important also to add financial conversations into the mix. For more tips, and to learn more about personalized student loan solutions, visit www.collegeavestudentloans.com.

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Tips to help save money on prescription drug costs

(BPT) – Modern medications can work wonders, improving quality of life, curing illness and even saving lives. However, those miracles can come at a high cost, as anyone who’s had to pay for branded prescription medication knows. In fact, spending on prescription drugs has increased 73 percent in the past seven years, according to a new report from the Blue Cross Blue Shield Association (BCBSA).

What’s driving the increase

The Health of America Report found prescription drug spending by Blue Cross and Blue Shield (BCBS) members increased 10 percent annually since 2010. High costs of patent-protected drugs account for the lion’s share of the total increase.

Generic drugs account for 82 percent of total prescriptions filled, but account for just 37 percent of total drug spending. By contrast, patent-protected prescription drugs comprise less than 10 percent of all prescriptions filled but account for 63 percent of total drug spending, the report found.

“Experience and past price trends suggest drug costs will continue to rise in the future,” says Maureen Sullivan, chief strategy and innovation officer for BCBS. “The need for more affordable generic alternatives to costly patent-protected brand-name pharmaceuticals is urgent. As prices continue to rise, more consumers will be looking for ways to curb the cost of their medications.”

What you can do

It is possible to lower your drug costs while still taking the medications your doctor has prescribed to help your health. BCBSA offers some guidance:

* If your doctor prescribes a costly name-brand medication, ask your physician or pharmacist if a generic version is available. Generic drugs are identical to their brand-name equivalents in dosage form, safety, strength and quality, how you take them, performance and intended use, according to the Food and Drug Administration. Generics typically cost less than name-brand medications. The BCBSA report shows how costs for medicines like Lipitor (atorvastatin) and Avapro (irbesartan) plummet when generic alternatives become available.

* It may be possible for your doctor to prescribe a higher strength than you need of a particular medication and allow you to split the tablet or pill to get the lower dose you need at a lower cost. In fact, many pills that can be safely split come pre-scored with an indentation that makes it easier to cut them in half. However, not all prescription medications can be safely split, so be sure to talk to your doctor or pharmacist about whether it’s safe to split your medications.

* Ordering prescription medications through the mail could lower drug costs, but it’s important to ensure you’re buying from your pharmacy benefit manager, typically listed on the back of an insurance card. The FDA recommends you only purchase drugs from organizations located in the U.S. and licensed by the state board of pharmacy where the company operates (find a list of state boards of pharmacy at www.nabp.info). The mail order pharmacy should have a licensed pharmacist available to answer your questions, require a prescription from your doctor in order to sell you medication, and have someone you can talk to directly if you have questions or problems.

* Another way to reduce drug costs is to ask your doctor to write your prescription for a 90-day supply so that you will get a three-month supply of the medication for the price of one co-pay.

* Finally, review your prescriptions with your doctor at least every six months to ensure you’re not taking any more medicines than you absolutely need. However, never skip doses of medicine, avoid refilling a prescription or stop taking medicine altogether without first consulting your doctor.

For more information about prescription drug costs, and to read the full Health of America report, visit www.bcbs.com/healthofamerica.

All product names, logos, and brands are property of their respective owners and used for identification purposes only. Use of these names, logos, and brands does not imply endorsement.

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5 steps that can improve your credit score in 100 days or less

(BPT) – Low interest rates, a strong economy and the turn of the seasons are all causing the real estate market to heat up. More homes on the market bring more competition to buy the inventory that is out there. And one way to stand apart from other buyers who are vying for their dream home is to take steps to improve your credit score now.

“Preparing your finances is a must before the busy real estate season,” says Barrett Burns, president and CEO of credit score model developer VantageScore Solutions. “Knowing your credit scores and making improvements is essential to getting the best loan at the best rates. This also makes you a more attractive home buyer, especially in a competitive market.”

With limited time, you may think there’s nothing you can do to improve your score. Burns says that’s an incorrect assumption. While you can’t make dramatic jumps in just a couple months, there are several steps you can take that may influence your score to increase enough to get you prequalified for the loan you want.

Keep in mind, lenders will pull your scores from all three major credit bureaus (Equifax, Experian and TransUnion), so it’s wise to check your credit report from each of them. You can do so for free once every 12 months at AnnualCreditReport.com. For best results, monitor at least one credit score from each of the bureaus. You also can check your credit score for free through a large number of online services, such as CreditKarma.com, NerdWallet.com or Credit.com. Other sites offering free VantageScore credit scores can be found at VantageScore.com/free.

Once you have your reports in hand, you can take steps that may have a positive impact on your scores.

Step 1: Check for errors

A credit report gives a comprehensive list of your lines of credit and payment history. The first step is to review your credit report for errors and take steps to make corrections, including past and present names, loan amounts and credit cards in your name.

When checking your credit score, bear in mind that some differences in credit scores across bureaus is normal. But if one of the three credit scores is an extreme outlier, it could be worth double-checking your credit report from that bureau to make sure it doesn’t reflect any questionable or erroneous activity.

Step 2: Don’t miss a payment

Creditors are interested in seeing how you manage credit, and the consistency of behavior counts. You should always pay at least the minimum amount due on bills on time every month. An easy way to ensure you don’t miss a payment is to sign up for automatic bill pay when available.

Step 3: Lower credit utilization levels

Credit utilization is the ratio of a credit card balance to the credit limit. If your balance is $5,000 and your credit limit is $10,000, then your credit utilization for that credit card is 50 percent. In general, a good credit utilization is less than 30 percent, so if you have a higher ratio, consider using your tax refund to pay down this debt.

Step 4: Don’t close old credit cards

If you have a credit card that is no longer used but was previously paid off on time each month, don’t close the account. Not only is this good for your credit utilization ratio, but it also is another indicator you’re a responsible candidate for a loan.

Step 5: Don’t apply for new credit

Avoid applying for any new credit, such as an auto loan or a new credit card account, between now and the time you will close on a home purchase. Lenders considering your loan application request your credit score from one or more credit bureaus. And these lender “inquiries” are recorded with one or more of the three national credit bureaus, which may lower your credit score by 10 to 20 points. The score decreases typically only last a few months, as long as you continue to make payments on time. But unless they’re absolutely necessary, try to avoid additional inquiries until after you’ve secured your mortgage.

If you follow these five steps, you may see an increase in your score within a few months so you can get a loan and be an attractive buyer when it comes time to put in a bid for your dream home.

Keep in mind, the more you can put toward the down payment, the more instant equity you’ll have, the lower your monthly payment will be, and the better your chances are of not needing private mortgage insurance (PMI), which can add hundreds of dollars to your monthly payment.

Plus, if you’re able to put down more than a lender requires, a mortgage company may be willing to give you a pass on other issues on your application, such as a less-than-stellar credit score.

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3 tips when buying a used car

(BPT) – If you’re in the market for a used vehicle, the car-buying process can be both an exciting and daunting experience. Whether you are a first-time buyer or looking for a different model, a car is one of the largest purchases you will ever make. It’s not only important to make sure you have the right car for your lifestyle, but one that makes the most sense for your personal financial situation.

If you are one of the millions of Americans looking to buy, here are some tips to consider.

Get pre-approved

Similar to buying a house, it’s important to know what you can afford before you start hunting for your dream car. If you will be financing a vehicle, getting pre-approved for a car loan may save you a lot of heartburn during your car search.

Interest rates continue to be at historic lows, but it’s important to check in on what rates you may qualify for and how it will affect the price of what you can afford.

“It’s easy to get caught up in the excitement of looking for a new car and forget about the affordability piece,” says Renee Horne, vice president of Consumer Lending at USAA. “Before you even begin your search, give your lender a call to see what you can actually qualify for and what will fit in your budget.”

A good tip to keep in mind is to not let your car payment exceed more than 15 percent of your monthly net income. While you don’t have to stick to it, this rule will help give you a rough estimate of what you may be spending each month.

Know what you can afford

Knowing what you can afford reaches beyond your car loan payment. Although used cars are typically less expensive, they may have more maintenance and ownership costs.

“It’s important to look at the total cost of ownership,” says Heather Pollard, vice president of Auto Experience at USAA. “Everyday expenses such as gas, insurance, taxes, maintenance and future repairs are all associated with owning a vehicle.”

Knowing a rough estimate of these expenses will help you stay on budget in the long run. Simple online loan calculators, like this one at USAA, can help give you an idea of how much you can afford.

Narrow your choices

With countless choices available, finding the right car for you can be a challenge. Your budget should help narrow some of your choices, but consider your lifestyle as well.

Do you have young children or plan to start a family soon? Then you might want to consider the highest IIHS safety ratings. Do you frequently travel for work? In that case, improved gas mileage and reduced emissions are important factors. Remember, all those extra upgrades come with a higher insurance price tag and are depreciating assets once you drive off the lot.

Although you may be more inclined to go after a new car with the latest cutting-edge technology, a pre-owned vehicle may be the better alternative for your lifestyle and budget. Better still, used car prices are the lowest they have been in years. Even if you opt for a slightly older version of the model you’re interested in, many used models still offer similar advanced features while saving you thousands of dollars in the end.

Need help finding the right car for you? The USAA Car Buying Service can help.

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A smarter way to buy a home

(BPT) – Are you considering buying a home? With mortgage rates on the slow and steady incline, there may be no better time for a home purchase than now. Mortgage interest rates will likely continue to go up for the foreseeable future, according to recent data from the housing finance company Freddie Mac. Many housing experts and industry observers agree.

What does this mean?

If you are thinking about buying a home, it means don’t wait any longer. The overall cost of buying a home in the future will only increase compared to buying a home of the same value today. Furthermore, rising interest rates impact housing inventory, as sellers might not be as interested in moving if it means paying a higher rate on a new mortgage. As a result, the dream home you see today might not be available next year.

The 20 percent down myth

If you’ve put off buying your next home to save for the full 20 percent there is good news: you don’t need it. If you were unaware of this, you’re not alone. A recent survey found that among first-time homebuyers who obtained a mortgage, 80 percent made a down payment of less than 20 percent. While there are several low down payment mortgage options available, only one has a 60-year history of being a steadfast, smart way to get into a home: a conventional loan with private mortgage insurance (MI).

What is a conventional loan with MI?

A conventional loan is a mortgage from a lender that is not completely backed by the federal government. For qualified borrowers with a low down payment, private MI is required and typically paid monthly along with the mortgage payment. You can obtain this type of loan with as little as 3 percent down, though buying with a 5 percent down payment will result in a lower monthly payment.

There are other types of low down payment options that also include MI, such as the government-insured loans backed by the Federal Housing Administration (FHA). Unlike the premiums charged by FHA loans, private MI premiums can be cancelled once 20 percent equity in home value is reached, and with private MI there are no upfront costs added onto a borrower’s initial down payment like there are with an FHA loan. This means your monthly bill decreases and you have extra money to spend on your family, vacations, retirement and any other needs.

Don’t sit on the sidelines and miss out on your dream home. To learn more about mortgage insurance compared to other low down payment options, visit LowDownPaymentFacts.org.

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5 tips to find the financial advisor to match your retirement goals

(BPT) – The idea of retirement may start out as a distant dream. You have hopes and plans for that special time that seems so far away. Sooner or later that time will be here and hopefully you’ll be ready.

However, recent research shows many people are not prepared to enjoy a financially stable retirement. A study by the Employee Benefit Research Institute states:

* Only 18 percent of people are very confident they will have the savings they need for a comfortable retirement;

* One-third of people aren’t confident they will be able to cover basic living expenses in retirement;

* 45 percent of Americans aren’t confident they will be able to cover their medical expenses once they’re retired;

* 3 in 10 workers report that preparing for retirement causes them to feel mentally or emotionally stressed.

Securing your retirement through financial planning

“Many people recognize the value of saving for a comfortable retirement. They just don’t know how to manage their money effectively to maximize their savings and realize their dreams,” says Geoffrey Brown, CEO of the National Association of Personal Financial Advisors. “To create an actionable strategy for saving, consumers should look for financial planners who are fiduciaries for help. These professionals are entrusted to manage assets or wealth while putting the client’s best interests first at all times.”

Financial planners provide support and advice on a wide array of financial topics, including budgeting, estate planning, investments, education funding, insurance and risk management, healthcare planning, and, of course, retirement planning and senior issues. Financial planners who are members of NAPFA are all fee-only and compensated solely through fees from their clients, rather than by transaction-based commissions. Most commissions-based advisors are salespeople rather than comprehensive financial planners.

All NAPFA members also sign a fiduciary oath, meaning they must disclose any conflict, or potential conflict, to their clients prior to and throughout the advisory engagement. Working with a fee-only fiduciary means you can be sure the advice you receive from your financial planner is in your best interest, not their best interest.

To find the right financial planner for you and your needs, follow these tips from NAPFA:

* Finalize your own initial strategy. Before looking for a financial planner, think about the goals you want to attain: What are you saving for? Are you trying to prepare for retirement, save for a new home or put a child through college? Maybe you’re saving for all the above. Once you understand your goals, it will be easier to find a planner who can help you reach them.

* Select several advisors. Don’t narrow your focus when looking for the right financial planner. Instead, consult websites like NAPFA.org. Use the NAPFA Find an Advisor search platform to locate a financial planner who can help you get where you’re going. Word of mouth is fine for some pursuits, but your financial goals are specific to your life, and probably differ greatly from those of your friends. Once you have a “short list” of possible planners, then you are ready to move on to the next step.

* Do your homework. When it comes to vetting a financial planner, a little research goes a long way. Once you’ve collected the names of a couple of planners that appeal to you, learn a little more about them. Visit their company websites or review their LinkedIn profiles to learn more about the company and the planner. You can also search the U.S. Securities and Exchange Commission site or BrokerCheck by FINRA to learn more about the planner’s disciplinary history. It’s important to review an advisor’s disciplinary records, their practice focus and their credentials — such as whether or not they are a Certified Financial Planner(TM) (CFP(R)) professional. This work can help you ask the right questions when setting up your first in-person meeting.

* Meet them face-to-face. If you like everything you’ve found so far, then it’s time to meet your potential financial planner. Set up a face-to-face meeting and bring questions of your own or use a Financial Planner Diagnostic tool. Pay attention not only to the answers your potential planner gives, but also to your comfort level during the conversation. Your financial planner will have a large role in your future success so it’s important that you feel comfortable with the relationship.

* Review your results initially and annually. Once you’ve finished your interviews, take the time to review all the information you’ve gathered and pick the financial planner that best fits your needs. After that, plan to review the performance of your finances every year. Your relationship with your planner is ongoing and a successful partnership is one in which you feel comfortable, your savings grow and you’re left excited and confident about what’s in store for your financial future.

To learn more about how you can find the right financial planner for you, visit NAPFA.org.

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3 steps to becoming a savvier online shopper

(BPT) – Every day, people use data to influence their decision making — from where to go for dinner, to selecting stocks in which they should invest, to where to live. Every Google search we perform, every Yelp review read or written, each item of clothing, houseware or electronic device we put in our virtual cart, is another data point companies can use to personalize our experience with their brands.

Despite all the data at their disposal, it seems many brands still don’t fully understand what consumers want from them in terms of products or services or how to best engage with their end buyer. A recent survey from cloud and big data integration company Talend shows 88 percent of information technology leaders believe their organization truly understands its customers, while only 61 percent of consumers believe companies understand their needs.

This begs the question: How do we differentiate between those brands that are using our data the right way, versus those that have a long way to go? Second, how do we help the brands we love understand us better without sacrificing our privacy?

1. Understand which data to share.

Think about your favorite shopping app or website. Does it know which brands you prefer? What about your shoe size? Does it have your zip code stored for shipping estimates? Does it make appropriate recommendations? The strongest relationships in life work both ways, so if you want a brand to know what you want from them, perhaps it’s time to share a little. Taking five minutes to fill out some basic profile information in your “preferences” could, at the very least, save you time on future shopping excursions and might even lead to a surprise find.

2. Use data to get the best deals.

When you’re shopping online, you can quickly compare prices for the exact item you want to purchase across multiple vendors, and, if you have time to wait, be alerted should the item go on sale. The best example is travel. There seems to be a never-ending list of websites available for booking flights and hotels, but booking the first flight you see without shopping around is rarely going to get you the best deal. Countless studies have shown booking on certain days of the week, or a particular number of weeks ahead of your trip, will yield the best results. From there, one still has to compare prices against different websites to find the best fare. Luckily, some of the top search engines are making this even easier for consumers by indicating whether the price is high or low. The art of finding the best deal is really in comparing the data.

3. Know where to draw the line.

At the end of the day, privacy is still important, and it’s prudent not to share too much personal information. Think critically about which data is going to be absolutely necessary to enhance your experience with the companies you rely on. For example, it’s not necessary to share your contact list, your geolocation or (if you’re on a mobile device) access to your camera if you’re using a music or financial app. Some brands ask for too much, and it’s up to each individual to determine which data makes sense to share with each brand and what doesn’t. For example, don’t be too quick to provide broad access to an app you’ve just downloaded. Also, as painful as it may be, do read the privacy policy of the sites you frequent and understand how they use and protect the personal information they collect on you.

Ultimately, most companies today are still just scratching the surface when it comes to understanding the impact customer data can have on the profitability and success of their business. There is still a lot of room for growth when it comes to companies effectively using data to address consumer needs. It’s up to each one of us to make sure we are sharing the right data with them, while also using that data to our advantage to get the best deals and online experience possible.

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Rogue retirement account? Expert advice to reduce rollover stress

(BPT) – It’s happened to almost everyone: you leave a job and have a retirement account that you are no longer actively contributing to. It sits there for months — maybe years — because you’re not sure exactly where to move it or what the process is like to roll it over. You know that money could probably be better invested, but moving accounts is intimidating, so it sits.

“It’s common for people to be nervous about transferring retirement accounts like IRAs and 401(k)s,” says Nick Holeman, a financial planning expert at Betterment.com. “Moving accounts shouldn’t be something you fear or put off because you think it’s too complicated.”

Holeman says three main causes for concern are potential taxes, excessive fees and process complexity. However, these concerns are often based on misconceptions, and he wants to set the record straight to empower investors to take control of rogue retirement accounts.

Potential taxes

Many people worry about potential tax concerns when moving retirement accounts. They’ve heard about the high penalties for early withdrawal and figure the best way to avoid them is to let the account be.

“A rollover is not equivalent to a withdrawal,” says Holeman. “When you transfer retirement accounts through the appropriate processes, you’re still keeping it in the same categorization. It just now lives in a different place.”

A rollover can also help facilitate better control of your money. For example, if you roll over an old 401(k) into an IRA account, you are no longer limited to the investment options selected by your employer. This freedom of choice can help you make more customized investment decisions based on your personal goals. Of course, it’s important to remember that investing in securities always involves risk and there is the potential to lose money.

Possible fees

A rollover means closing an old account and opening a new account. This process can incur fees that will be unique to each provider. Many people worry about the potential cost, which causes them to leave accounts untouched.

“Research account closing fees but be sure to keep in mind the big picture,” Holeman says. “It’s like ripping off a bandage. For example, a one-time $20 closing fee is better than a $100 annual fee that could be reduced when you move your account.”

Holeman’s advice: always know what fees you’re paying. Before selecting a new financial organization for your retirement savings, research fees and consider selecting a new account with no trading costs, commission fees, or rebalancing fees. For example, Betterment’s Digital plan charges just 0.25 percent per year and that covers goal-based financial advice, tax-efficient investing, automatic rebalancing, and other smart features that help you keep more of your money.

Complexity

“People tend to treat rolling over a retirement account like going to the dentist,” Holeman says. “It’s important but usually not urgent, so people tend to put it off.”

What’s more, people are intimidated by all the paperwork, lengthy forms and seemingly complex steps, so they delay rollovers. Holeman says moving accounts is typically easier than most people think, and in fact, after the process is complete, many people regret not doing it sooner.

“Often, moving retirement accounts can be done completely online thanks to advanced technology,” says Holeman. “Betterment offers a ’60 second rollover’ for certain accounts from supported companies, and there’s someone available to help should you have any questions. Moving accounts is typically easier than people imagine.”

You should carefully consider whether a rollover is right for your own personal situation, including the specific fees and services associated with your 401(k). Visit betterment.com/rollover to learn more about factors you should consider when deciding whether a rollover might be right for you.

Betterment LLC distributed this article through Brandpoint.

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