Tag: monitor finances

To Bring Your Financial Goals to Life, Get Strategic

Published in: Resources |

Our last blog focused on suggesting that clients examine whether their priorities and goals need a reset at this point of the year. This can be challenging and emotional work, but when it comes to setting and achieving goals, the accomplished marathoner Juma Ikangaa says it best: “The will to win means nothing without the will to prepare.”

We at The Humphreys Group believe in preparation; we provide clients with specific steps for reaching their goals and gaining a clearer understanding of how their financial strategy can help them do so:

  • Provide a brief description of/reason for each goal. Some suggestions include: “increase current financial security,” “build retirement savings,” “strengthen family ties,” “bolster emergency funds” “pay off debt,” “afford travel,” “fund education/personal development,” etc.
  • Assess how much time, energy and any other additional resources (such as education/training) are required to reach each goal.
  • Estimate the amount of financial earnings, savings and/or investment required to achieve each goal. Begin with a “guesstimate.” We advise that these numbers can always be refined as clients gain more information and work with their advisor to understand what it will take financially to meet their goals.
  • Assign a priority status of “A,” “B” or “C” to each goal and determine the length of time you want to commit to reaching each goal. Having a sense of how important the goal is and how long it may take to achieve can help prevent feeling overwhelmed or under pressure to reach each goal. Suggested timeline categories include: Immediate Goals and Priorities; Short-Term to Mid-Term Goals and Priorities (1 to 5 Years); and Long-Term Goals and Priorities (5 Years or Longer)
  • Consider that priorities may shift. Remember, it’s okay to press “reset” from time to time!

At The Humphreys Group, we believe that priorities and financial goals can give shape to actions, and help provide long-term calm and security in our clients’ lives. We help clients prepare for success by reviewing what meeting their goals will cost in terms of their time, attention, energy and money. Contact us today to learn how you can give life to your goals with a well-prepared financial strategy.

Beating the “Dog Days of Summer”: Do Your Priorities and Goals Need a Reset?

Published in: Resources |

We’ve reached the “dog days of summer” — the time of year when ancient Greeks observed the bright Dog Star in the skies above them, and worried that uncertain times might soon follow its appearance. The constellations have shifted slightly over millennia but, by the time August arrives, many of us are still concerned about what the coming months will bring to our lives. At The Humphreys Group, we think now is the perfect time to decide whether our priorities and goals need a reset; doing so can ensure we move forward through the remaining year with renewed purpose and focus.

Here’s a quick summary of how we help clients determine if they need to rethink their priorities and goals and reset their course for the months ahead:

Priorities

  • Career and family top many people’s lists, but we also recommend a closer analysis of other life components including: health and fitness; financial well-being; leisure opportunities; creativity and educational enrichment; self-care and community ties.
  • We ask clients to review the time and energy they spend on these aspects of their lives and how satisfied they are in doing so.
  • To support clients as they clarify their priorities, we encourage them to establish the areas of their lives where they want to spend as much or more time.

Goals

  • Once clients gain a clearer sense of where their life priorities lie, and whether they want to make adjustments to those priorities, we guide them toward attainable goals.
  • We refer to a variety of tips and strategies that begin with developing “big picture, long-term goals” (such as a five-year plan), then strive to make those goals attainable on a yearly and monthly basis.
  • We explore whether the motivation for achieving their goals is intrinsic (sparked by personal drive or dreams of satisfaction), extrinsic (expectations outside of ourselves influenced by societal, professional or familial reward) or a combination of both.
  • In each instance, we acknowledge that we are doing challenging, sometimes emotional work. We embrace both the emotional and rational aspects of setting priorities and goals as we thoroughly discuss, analyze and make projections about how clarifying priorities and attaining goals may affect each client’s future.

The world has come a long way since the star-filled nights of ancient Greece, but we can continue to take time to reflect on what lies ahead for us. We support individuals’ modern-day efforts to examine their priorities and goals, and we possess the knowledge and experience to help our clients reset them in positive and proactive ways.

Contact The Humphreys Group today for more information about the strategies we use.

Mid-Year Wellness: The Credit vs. Debit Debate (Part II)

Published in: Resources |

It’s official: 2019 is nearly halfway over, which means that now is the time to pause and take stock of your total wellness. This includes your spending habits and where you stand in your progress toward your year-end goals. What methods do you actually use to make purchases? Do you favor debit cards over credit cards? Which method is “safer”?

Our Financial Planning Associate, Hallie Kraus, is tackling these questions in a new, two-part blog series. If you missed Part I of the series, click here to get up-to-speed. In Part II, Hallie explores the benefits of using a debit card to make purchases and is sharing some resources you can use to make smart spending decisions.

Now that you know the potential benefits — and risks — that come with using a credit card to make purchases, it’s time to take a look at the other side of the payment spectrum: the debit card.

When Is It Best to Use a Debit Card vs. a Credit Card?

When you want to manage your spending or avoid debt. This is, by far, the best reason to use a debit card, and it’s not insignificant. If you’re trying to reel in your expenses, or if you’re the kind of person who simply likes to have more structure to keep your expenses in line, debit cards are the way to go, simply because you’re only paying with money you already have.

Unfortunately, these days, card “skimming” has become more prevalent, in which fraudsters use small devices to steal card information in an otherwise legitimate transaction. Keep in mind that most experts discourage the use of debit cards at gas station pumps or independent ATMs, where skimmers are most likely to target.

You want to minimize fees — for you, as the consumer, and for the merchant. Using a debit card means you never risk the possibility of incurring interest, late fees or annual fees — all of which are associated with most credit cards.

Merchants, on the other hand, pay a processing fee to card issuers in order to accept both credit and debit cards. The processing fee for credit is typically a percentage of the customer’s purchase, while the processing fee for debit is lower, and often a flat fee. So, it’s actually cheaper for merchants when you, as their customer, elect to have a debit transaction — something to keep in mind if you want to do what you can to help the profit margins of your favorite businesses!

The Bottom Line

Regardless of whether you use a debit or credit card to make purchases, it’s important to keep the following tips in mind:

Monitor your transactions regularly. The sooner you report a fraudulent transaction, the better. Make it part of your routine to check your activity on a regular basis and report anything suspicious to your bank as soon as possible.

Only you know your habits and what’s best for you. Be honest with yourself about your financial strengths and weaknesses, and use that to determine which card make the most sense for your lifestyle and spending habits.

Check your credit report on at least an annual basis. You can view and download your credit report from each of the three bureaus for free once per year by visiting www.annualcreditreport.com. This is yet another effective way to monitor for fraudulent activity and familiarize yourself with what makes your credit tick.

There are plenty of resources available to help you practice smart, diligent spending. When it comes to monitoring fraud, one of the best guidelines is the Federal Trade Commission (FTC) website, which also offers plenty of advice regarding lost or stolen credit and debit cards. If you would like to learn more about the pros and cons between debit and credit cards, check out this article by AARP and this piece by The Simple Dollar, both of which provide comprehensive and unbiased overviews of both methods.

And, as always, The Humphreys Group is here to help answer all of your personal financial planning questions. If you would like to learn more about saving and spending best practices, contact our team.

Mid-Year Wellness: The Credit vs. Debit Debate (Part I)

Published in: Resources |

Now that we have officially reached the halfway point of 2019, there is no better time to stop for a “breather” and take stock of your total wellness — and that includes your spending habits and how they factor into your progress toward your year-end goals. This brings us to a few questions we receive quite often here at The Humphreys Group: What should you actually use to make purchases? Are debit cards the “safer” method, or do credit cards rein supreme?

Our Financial Planning Associate, Hallie Kraus, is shedding light on the debate in a new, two-part blog series. Scroll down to read Part I, and then catch Part II here.

“Credit or debit?” We’re asked this question all the time at the register – but which payment method is actually best to use? And what’s the true difference between the two?

Let’s start with a basic recap: Debit cards are directly connected to your checking account. When you make a purchase, funds are withdrawn from that account immediately and transferred to the merchant.

Credit cards, on the other hand, are connected to a line of credit from your bank. When you make a purchase, you’re borrowing funds from your bank to pay the merchant. If you don’t pay off everything you owe each month, your bank will charge you (usually very high) interest on the remaining balance.

When Is It Best to Use a Credit Card vs. a Debit Card?

When you want to build your credit. If you’re planning on buying a home or car, lenders first want to see that you have a good credit history. And when you use a credit card, your balance and history of payments is reported to a credit bureau each month, creating a record — and, essentially, a narrative — of your financial habits and trustworthiness to lenders. Using a debit card is not reported to credit bureaus and therefore doesn’t create any sort of history.

Of course, simply using your credit card alone doesn’t help your credit; what matters is if you use it responsibly. If improving your credit is truly a priority for you, make sure to keep your credit card balance below 30% of your limit (for example, if you have a $10,000 limit, keep the balance below $3,000). You’ll also want to pay off the balance in full, and most importantly, pay your credit card bill on time every month. Not doing any of the above will negatively impact your score and thus be counterproductive.

When you want to minimize your fraud liability. This is perhaps the most compelling reason to use a credit card. Firstly, when a fraudster uses your credit card without permission, they’re technically stealing money from the bank that issued you the card — not from you personally. But what you may not know is that credit cards also offer more robust fraud protection.

Thanks to the Fair Credit Billing Act (FCBA), if you report unauthorized charges to your card issuer within 60 days, your liability for fraudulent transactions is limited to $50. Even better, the vast majority of credit card companies (Visa, MasterCard, American Express and Discover) have a zero-liability fraud policy. Essentially, assuming you report credit card fraud promptly, you will probably never pay for unauthorized transactions.

In contrast, when a fraudster uses your debit card, they have immediately stolen money from your bank account. And although debit cards have their own set of protections through the Electronic Funds Transfer Act (EFTA), they are much less robust. According to the EFTA:

  • If you report a fraudulent debit card transaction within two business days, your liability is limited to $50.
  • If you wait longer than two days to report the fraudulent transaction, you can be liable for up to $500.
  • If you wait longer than 60 days to report, you could be held liable for the entire fraudulent transaction. So, depending on how much the fraudster has used your debit card, and how diligently you check your transaction history, your damages could be unlimited.

But there is one workaround: If you strongly prefer using a debit card, but want to achieve the same level of fraud protection as a credit card, select “credit” when you run the debit card. This requires the bank to follow credit card rules: Rather than being withdrawn from your bank account in real time, the purchase will go through the credit card network, and funds will be withdrawn within a few days. But the key distinction is that the transaction will be covered by the card company’s zero-liability policy, thereby exempting you of responsibility for unauthorized transactions.

When you want to earn rewards and have a good handle on your spending. Banks love to offer credit cards with cash back, points or other rewards, and it’s easy to see why. When rewards are connected to how often we use a credit card, we as consumers are incentivized to use them more often. The banks are essentially betting that, in our quest for more rewards, we will charge more to the card than we can pay off in one month, so they can charge us interest on the remaining balance.

That said, when used responsibly, rewards credit cards can save consumers a decent amount of money. If you want to use a credit card for this reason, make sure you never use the card for something you can’t afford in cash, and of course, pay off the balance in full every month. It’s also worth periodically doing the math to double check that your rewards exceed any annual fees associated with the card. If you’re paying the bank interest every month, or have sky-high annual fees, the credit card is not worth it, regardless of its rewards or other benefits.

Click here to read the second installment of Hallie’s two-part series, in which she discusses the benefits of using debit cards over credit cards and shares some helpful resources you can use to practice smart spending all-year-round.

Cybersecurity Step-by-step #9: Open Your “my SOCIAL SECURITY” Account

Published in: Resources |

Your financial well-being is our highest priority, and one of our goals for 2018 is to walk you through the necessary steps to protect your online data. To make it more manageable, we are sending you one new action item every month. If you missed the previous steps, we have listed them below with a link to the detail so that you can easily catch up.

Step Nine:  Open your online “my Social Security” account now (Yes, we mean ASAP!)

Why Now?  A cybercriminal with your social security number and address may be able to create a “my Social Security account” in your name and potentially claim your benefits before you do.

What is a “my Social Security account”?  The Social Security Administration has shifted to an online platform. An online mySSA allows you to view your social security information, as well as apply for and manage your benefits. Now that the online platform is in place, the Social Security Administration has stopped mailing estimated benefits statements to anyone currently under age 61. So, if you are under age 61 and working, you should visit this site annually to make sure that your earnings are reported correctly.

What are the steps to set up my account?

  1. Unfreeze your credit history at Equifax: In order to verify your identity, the Social Security Administration will ask you for personal information and compare it to information retained by Equifax. You will need to temporarily lift your credit freeze at Equifax to allow the Social Security Administration to make this comparison. Simply call (800) 685-1111 and follow the prompts. (Note: you will need your PIN)
  2. Open a my Social Security Account: Visit https://www.ssa.gov/myaccount/ and follow the prompts.

Visit this link to learn more about why you should set up an online Social Security Account.

 List of Previous Steps:

Step One: Place a freeze on your credit history at the top three credit agencies.

Step Two: Update the operating software on your computers, tablets and smartphones, and continue to update as new patches become available.

Step Three: File your tax returns as early as possible.

Step Four: Use unique passwords on every site (and try a password manager).

Step Five: Never (ever) email sensitive information and always insist on encryption.

Step Six: Avoid using public WiFi networks.

Step Seven: Monitor your financial activity.

Step Eight:  Avoid Spear-Phishing Scams

 

 

 

Cybersecurity Step-by-step #7: Monitor Your Financial Activity

Published in: Resources |

Your financial well-being is our highest priority, and one of our goals for 2018 is to walk you through the necessary steps to protect your online data. To make it more manageable, we are sending you one new action item every month. If you missed the previous steps, we have listed them below with a link to the detail so that you can easily catch up.

Step Seven:  Be Vigilant – Monitor Your Financial Activity

Why?  Scammers rely on the probability that you are not paying close attention. The sooner you spot a problem, the more likely you can minimize the cost and the hassle of repairing your record.

The following are our top four recommended strategies to monitor your financial activity:

  1. Open ALL your mail. Look for unexpected bills and confirmations of activity you didn’t initiate. If you aren’t receiving mail, that could be a problem too.
  1. Look at your bank and credit card statements regularly. Seems basic, but now that we get those statements online it’s easy to forget. If you frequently forget, consider going back to paper. Be sure to also look for “subscription creep”.  Free trials and discount subscriptions often convert to full price and can add up to significant costs.
  1. Use an expense-tracking app. These apps can consolidate all your spending activity so you’ll only need to look in one place to review everything. Many apps have built-in alerts to let you know if there is unusual spending activity. (Learn more)
  1. Review your credit report annually (at least). Even though you have already placed a freeze on your credit history (see Step One), you will still need to make sure that your current lenders report accurate information. You can receive a free annual copy of your credit report from each bureau by visiting annualcreditreport.com.

List of Previous Steps:

Step One: Place a freeze on your credit history at the top three credit agencies.

Step Two: Update the operating software on your computers, tablets and smartphones, and continue to update as new patches become available.

Step Three: File your tax returns as early as possible.

Step Four: Use unique passwords on every site (and try a password manager)

Step Five: Never (ever) email sensitive information and always insist on encryption

Step Six: Avoid using public WiFi networks

Please visit our blog to review these steps in detail.