Money Talks Blog by Oxford Planning Group

With everything going on in the world right now, a credit score is the last thing on a lot of people’s minds. However, if neglected, it can hurt you for a long time. The pandemic has brought many changes to people’s lives, that can affect some really important aspects. The loss of a job is a big challenge for many people right now. Keeping up with your credit score while trying to navigate a pandemic can be stressful. Here are a few reasons why it is so important though.

Why it’s so important

Your credit score can affect a lot in your life, from being able to rent an apartment to getting a loan, to buy a house.

• A lower credit score can negatively impact your ability to get a loan you need but also can cause you to have a higher interest rate for the loan - if you can get one.

How to check your credit score

This is the only actual free site to check your credit score authorized by Federal Law.  Be sure you’re on the right site – many have very similar sounding names:

http://www.annualcreditreport.com

• Free once a year from each of the three major credit reporting agencies (Experian, Equifax & TransUnion).
• Update: Starting in 2020, everyone in the U.S. can get 6 free credit reports per year through 2026 by visiting the Equifax Website or by calling 1-866-349-5191. That’s in addition to the one free Equifax report (plus your Experian and TransUnion reports) you can get at AnnualCreditReport.com¹

COVID-19 Considerations

• If you have lost your job during the pandemic, try to minimize the impact on your credit score by paying your bills on time and pay at least the minimum required (preferably more though) with money from an emergency fund.
• See what type of assistance there is currently that applies to you for bill relief.
• See if you are applicable for a mortgage suspension or forbearance.
• If you are approved, make sure to check that the suspension period is credited to you correctly, so it does not hurt your credit score by seeming as though you simply did not pay for those allotted months.

Ways to take advantage of the current market

Due to the interest rates cuts cause by the pandemic, rates on mortgages have fallen since the start of the pandemic. This could be beneficial if you are a homeowner with a higher mortgage rate because you may have the opportunity to refinance your mortgage.

There are also many car deals going on right now as dealers are trying to move product that wasn’t able to be sold due to the pandemic. If you are in need of a new car or know you will need one soon, start researching the type of car you want and see if there are any deals going on worth taking advantage of for your personal circumstances.

Take the time to be sure all information reported is accurate and if not, contact those agencies immediately. 

Remember to check both your score and your partner’s credit score as they are reported separately. 

Stay healthy and let us know if you have any questions. 

¹ Source:  https://www.consumer.ftc.gov/articles/0152-credit-scores

As most of us know by now, the Federal and Maryland State Tax return deadline was moved to July 15, 2020. You can either mail in your tax returns or you can E-file. E-filing has some advantages over paper filing, especially if you are younger and below a certain income.

Filing your taxes can be pretty confusing when you are doing it the first couple of times. Luckily, the IRS has a Free Filing option that lets you file your taxes electronically for free if you meet certain criteria. Depending on what state you live in, some of the programs also allow you to e-file your state taxes for free. The criteria varies - some programs have a certain salary limit and others based it off age or eligibility for certain credits. The highest salary allowance for 2019 was $69,000 to file for free.

Simply go to:   https://apps.irs.gov/app/freeFile/

You can use their Lookup tool (blue box at the top of the page) to quickly determine which programs you can use for free.

If you don’t qualify for a free filing program, you can still file for free by simply using the free fillable forms online.

There are a couple of benefits to E-filing, especially right now because the IRS is taking longer to review returns due to the impact of COVID-19.

• You could possibly get your return faster because electronic returns are easier to process than paper returns.
• You have the ability to track your return because the IRS will let you know when the return is received.
  • Once you receive this notification, you can also see when your return is approved and when it will be issued

If you have already filed for 2019 and did it by paper, great job! Your return may take a little longer due to the circumstances of COVID-19. If you have not already filed, consider E-filing to save time!

As we have all slowly adjusted to our “new normal” (I bet you’ve heard that phrase about 20 times this week), it seems almost odd that it has been about 2 months into this quarantine. Wearing a mask is pretty much second nature at this point when I go into a store. I’ve seen the word “essential” plastered everywhere from signs saying thank you to workers, to commercials taking advantage of the new popular word. As we see the infection rates start to come down thanks to social distancing, hope can creep in that we can start to re-open certain businesses. While some states have already re-opened, Maryland is taking a more cautious approach and basing openings off data and trends for the infection and death rates.

Governor Hogan is implementing a stage-based recovery program for Maryland, in hopes to best serve our state and prevent a resurgence of infection rates.

Stage 1 (As of May 28^th – this is our current status)

This stage is based off low risk activities and re-openings. In order to get here the Governor needed to see a consecutive 14-day decline in a numbers dealing with hospitalization rates. The point of this step is to move slow and watch infection rates as some things are allowed to reopen.

• The stay at home order was lifted and replaced with a “safer at home” guideline
• Changes that have occurred so far:
  • Opening of small shops and businesses
  • Curbside pickup for businesses
  • Elective medical procedures
  • Small attendance outdoor religious gatherings
  • Recreational boating, fishing, golf, tennis camping, hiking, & hunting
  • Outdoor fitness classes
• Changes effective May 29^th at 5 p.m. :
  • Outdoor dining for restaurants
  • Youth sport and day camp activities for no more than 10 individuals
  • Outdoor pools at 25% capacity
• Hogan gave discretion to each county as to when they would begin phase 1 due to the varying levels of infection rates in each
• Howard county has just announced that as of this Friday, May 29^th, we will begin opening some businesses at 50% capacity and slowly moving into Phase 1
• Stop signs: various things can occur that would require Maryland to stop moving through a phase or revert to previous rules
  • Increase in hospitalizations
  • Disregard for social distancing guidelines
  • Significant outbreaks of community transmission (sustained increase over 5 or more days)

If Stage 1 is a success (hospitalization and infection rates do not spike), then medium risk activities will begin to open. Many people are frustrated at the slow pace of the reopenings; however, they are designed to protect Marylanders, prevent a spike of infections, and help with a steady recovery. Please do your part by wearing a mask, practicing social distancing, and enjoy things as they begin to open while following guidelines.  We wish everyone good health.

Happy Spring! We are officially in the 3^rd week of it now. While no one envisioned their spring to start off this way, all we can do is try to make the best of it. I have been thoroughly enjoying noticing all of the beautiful flowers popping up around my house and loving it as the days get longer. 

Now would probably be about the time of year that I would try to make a great and nonboring blog about “Spring Cleaning Your Finances”. However, with all the uncertainty surrounding the coronavirus right now, I don’t think that’s what anyone needs. Instead, let’s talk about spring cleaning your mind and your space! 

Keeping Healthy

There is obviously a huge focus on physical health right now. There should also be a big focus on mental health as well. I’m not even going to pretend to know too much about what is going through the minds of people across the nation. Everyone is being affected differently right now. If you are feeling stressed for one of the many reasons out there right now, make sure to take care of your mental health in whatever way is best for you. Below are a couple of easy suggestions. 

• Go for a daily walk outside if you are able (this is allowed even in states where the shelter in place measures are in effect)
  • make sure to respect the social distancing measures and stay 6 feet away from people
• Find an indoor activity that you enjoy that can help take your mind off of things
  • I love baking and cooking and while I don’t always have the time, it definitely helps take my mind off the day 
• Take a break from social media and the TV
  • Scrolling through my feed all I see are either stories about the virus or some new at home workout I should buy (neither are particularly relaxing to look at) 
• Reach out to friends and family
  • Talking on the phone or video chatting with people has helped brighten my day and made me feel a little more connected to people 
• Try out a meditation app or podcast!
  • There are a lot of free apps available right now - a quick google search can help you find which one might be best for you

If you are feeling a bigger strain on your mental health right now, reach out to a professional. There are many online services available during this current crisis. 

Spring Clean Your Space

Yes, I know this is not a new idea; however, I don’t think it has ever been more relevant. With so many people working from home or having to stay inside with their whole family, a clean slate might be just what you need. 

• Make a list for the week with one space to clean each day. Make it manageable so it isn’t a huge task if you don’t have tons of time. It can be simple like cleaning out that junk drawer that always bugs you or something more involved like organizing your closet. 
• Get the kids involved! With the beautiful weather finally emerging, get outside and have the kids help weed your garden if you are lucky enough to have one (and lucky enough that the kids will help) 
• See what you can donate! Spring is already a big time for donations as people clear out what they don’t need and now they are needed more than ever
  • From books to clothing donations, there is a charity out there trying to find a way to use most items in good condition to help people during this uncertain time

Do you part and stay inside to help our community! 

Social Distancing

               This is the big buzz word on social media right now. While there are many jokes and memes out about this, it isn’t a joke. This is a very important concept right now that could help us slow down the spread of the virus. The fact is that this virus can have very serious consequences. From what we have seen from other countries, it will most likely only continue to get worse here. Even if you aren’t that worried about getting it yourself, you need to be following the CDC and state guidelines to protect those around you. While a night out with friends sounds fun, the consequences of potentially passing on the virus to someone who is going home to family members that could be affected definitely isn’t something to take lightly. So, let’s all do our part and try to keep our community safe.

Work from home tips

               Many people are finding themselves newly working from home or working from home a lot more than they did before.  While this is such a great opportunity to be able to continue working while also practicing social distancing, it can be a little difficult to get into a good routine and keep yourself on track while at home.

Here are a couple of tips to help you stay productive during your new “normal” workday:

·         Start the morning by making a list of things to get done that day

·         Change out of your pajamas to get your brain into work mode

·         Get up and stretch for 5 minutes every hour

·         Keep a normal lunch hour

·         Create a clutter free space specific for you to do work

For those of you home with kids right now, my sincerest apologies.

On a more helpful note, I know many teachers are going on Facebook and posting what grades they teach if you need any help. I’ve also seen posts from schools telling parents not to overwork themselves trying to keep a perfect school schedule. This is a weird time so give yourself a break. If the kids just aren’t having it one day, do something creative instead or read a book together instead of working on that impossible math question that has just led to tears.

Health tips

The CDC has been updating their website daily with new information and reports on the Coronavirus.

                          https://www.cdc.gov/coronavirus/2019-ncov/index.html

Go to their website listed above for more in depth information on what to do during this time. 

Small Businesses

               With states starting to shut down restaurants, bars, and shops other than the necessities such as grocery stores, small businesses are struggling already. While some jobs are not as affected and can continue their day to day operations, these small businesses are not as fortunate and are having to close completely. No sales means no money coming in at all. People are struggling to figure out how to pay their employees and keep their businesses afloat.

·         Buy gift cards to your favorite places – for your self and consider them as gifts for others

·         See if any of them are doing take out

·         Businesses can sell beer and wine for delivery

·         Spread the word about your favorite local places!

One of my favorite local shops has a sign that means more in these times – it simply says commUNITY.

It really does take a village.  Save lives and stay inside. 

With all the news reports on coronavirus, specifically COVID-19, it's hard not to be concerned. There are new reports out daily that bring new fears about health and the markets. 

Health Concern

Coronaviruses are not new themselves. They are a large family of viruses common in many animals and rarely infect humans. However, this specific coronavirus has not been seen before. 

The CDC has stated that the new coronavirus (COVID-19) spreads from close person-to-person contact through respiratory droplets. Close contact counts as about 6 feet apart. A person may be able to pick the virus up from surfaces recently in contact with an infected person. People are thought to be most contagious when they are the sickest and showing symptoms; however, the virus may be able to be spread when someone is asymptomatic. The coronavirus is still considered an emerging virus and there is a lot to be learned about it. 

Right now, the concern to the U.S. general population is listed as low.  Keeping up with current news to stay informed on the virus is a good idea. While the coronavirus is not a high threat yet, flu season is still here. The best recommendations right now are to stay current on news and keep good hygiene practices. Avoid touching your eyes and face while out in public, wash your hands thoroughly, avoid close contact with anyone who is sick. If you haven't already gotten your yearly flu shot, it's a good time to get that as well. While it won't protect against this new virus, it can help you keep healthy from the current flu strains going around. 

Market Concern 

Watching the news on the coronavirus, we are seeing effects on daily volatility of markets as the markets try to predict the effect of GDP and corporate earnings. Going forward the virus’s effect on the market will likely depend on how far reaching the virus is. Further spread or a prolonged time period would likely rattle the markets.  We continue to hope for a slowdown of both the spread between people and the geographic spread.  

The CDC keeps their webpage on COVID-19 up to date with new information every day. For more information click on the link below. 

https://www.cdc.gov/coronavirus/2019-ncov/index.html

Have you ever been in a situation where you wanted to talk to your friends about money, but you weren't sure how to bring it up? Money is a tricky subject with anyone - check out a couple of common scenarios below for some tips: 

Splitting the Bill

If you've ever gone out and purposely ordered something cheap only to have someone suggest you split the bill, you know how frustrating this can be. If someone asks you to go out to grab a bite with them and you know they like to split the bill there are a couple of options. Be up front about it by saying you would love to go but are on a tight budget 

The Friend Who Over Spends and Complains About Not Having Enough Money

This is a tricky one. It's only natural to be concerned about a good friend if you see them overspending and worrying about money. However, personal finance is exactly that, very personal. In my opinion, unless they directly ask for your advice or you are extremely close with the person, you should probably keep your advice to yourself. Even with these two situations it's important to not overstep. If someone asks for your opinion on a small issue, give them advice on that topic and maybe anything directly related. This is not the time for a full-blown finance lesson or for you to bring up other issues you have noticed.

As for bringing up something with a close friend, if you truly feel like you have a close enough relationship, then you could try to start up a conversation. Try to do it in a positive way. Instead of saying "It seems like you are spending too much money and you need to stop" try phrasing it like "I've noticed you've been worried about money lately, maybe we could sit down and work on a budget worksheet because that has really helped me stay on top of things lately".  Even if you think that you have a close enough relationship, some people just don't want to hear about it or talk about money problems with friends. If you bring up something and your friend seems upset or uninterested, just take a step back, apologize for overstepping and don't keep bringing it up. 

Money Loans 

If a friend asks you for a loan, take a minute before you say yes. If you say yes, you need to be ready for the fact that they might not repay you. A very smart woman once told me if you loan money to family or friends, it’s best to consider it a gift. If they wind up repaying it, great! And if they don't, then it won't be an issue. The reason for this is that it can really ruin a relationship when money is loaned and expectation for repayment are not met. You should also be prepared for what your friend then uses their money for afterwards. If you loaned them money and agreed to consider it a gift in your mind, then see them going on a fancy trip a little while later, that will probably not feel good and can cause strain between people. If you have the money and want to help, then just think about these issues before hand. If you don't have the money, then let them know that. It can be hard to say no but you don't want to put yourself in a bad spot because you wanted to help someone who may or may not pay you back. 

Share your own thoughts on money with friends.  Who knows?  You may make it easier on them to start a conversation. 

Who is excited for the New Year? For me, it feels like this is the first year that I will really be marking my year in January. I graduated last December but with the whirlwind of everything going on, I was still in the mindset that my year began in August with the start of a new school year. With that in mind, I decided I wanted to set up some goals for myself for 2020.  

Many think that New Year's Resolutions are overrated, and I tend to agree. I don't want to make any extravagant goals.  The beginning of a new year can have so much going on, it can be hard to keep up with a strict goal such as making it to the gym every day of the week or eating perfectly healthy.  

Simple Goals

Instead of making one really big, really hard to achieve goal, I want to make a few simple goals to work on throughout the year.  

Goal 1:  Improve my cooking. I want to take a cooking class at some point during the year. Maybe with some friends as a fun activity to do together. For this goal, I also want to try making one or two new recipes a month depending on time.  

Goal 2: Start a travel fund. Over the next year, I want to determine a reasonable amount that I can put aside every month into a travel fund. I'm going to leave it generic at first and set a goal I would like to reach.  

Goal 3: Make time for friends while balancing time for myself. As this year is coming to a close, I've gotten to see friends and family and been able to do a lot of cool things. However, I lost a little bit of balance. I reserved a lot more time for other people and then the only time I had for myself was taken over by studying. In the new year, I hope to set aside some time every week that won't be for chores or studying. It will just be for me to relax, maybe do some yoga, and enjoy time by myself.  

My plan is to get a journal just for my goal progress and once a week I will sit down and write down any ways I worked on one of my goals.  

What are your goals for the new year? Whether they are financial, family, or health related, give yourself some credit for the things you are already doing well and make the best of the new year.  

Happy holidays from all us here at Oxford Planning Group! 

The holidays are a great time of year. They can also be an expensive time of year. Some stores advertise their Black Friday sales for weeks before Thanksgiving. Consumers are constantly seeing signs stating "best sale of the year" or "one time chance". The goal of these slogans is to make consumers feel like they have to take advantage of the sale or they are wasting money. The truth is if you are on a budget, Black Friday sales can seem like such a great way to save money, when in reality they cause a lot of people to overspend.

If you want to take advantage of Black Friday, think about a couple of things first.

Planning Ahead

Know that you need to replace or buy something specific this year? If it's not urgent, it's a great idea to plan ahead and save up money for that item and see what kind of discount you can get around the holidays or right after. With Black Friday right around the corner, this probably isn't an option if you are just now thinking about it. However, it's a good idea to look at the deals going on to get an idea for next year!

Do you need it or want it?

Would you want or need this item at its full price? A great deal can sometimes make people think they need an item, but if the item was still full priced, they wouldn't even look at it. For example, say you see a brand-new coffee maker with different settings that can make tons of drinks and it's $100 off. This item is still probably pretty expensive, and you could get a much cheaper and less fancy coffee maker if you really do need one.

Can you afford it?

I won't lie, there are some pretty tempting sales that go on this time of year. If you haven’t done my first suggestion (planned ahead) but see something that you really want or really need, ask yourself if you can really afford it right now even with the discount. If you are going to have to put it on a credit card and can't pay off the amount in full before the due date, you could wind up paying the full price of the item anyway.  This is due to the fact that credit card interest rates are very high and not paying off your balance in full each month leads to a lot of money paid in interest.

Compromise

If you find something you really love, see if there is any wiggle room you can give yourself. Look at your budget and see if you take some money out of your savings to buy the item now but can lower one area of your budget the next month or two to replenish those savings. It could be something simple like committing to not eating out at all for the next month and putting the money saved into savings or something bigger such as changing a weeklong trip to a long weekend.

Enjoy the holidays but remember that “deals” are only worth it if you don’t overspend and regret it  later!

• In-unit washer and dryer (instead of a separate laundry area in a basement) This could be considered a need as far as security 
• Central air and heating 
• Fitness center: it could save you money to look for a place with a gym for residents to use instead of paying a gym membership 
•  Carpet vs. Hard wood/ faux hard wood 
• Smoke free apartment 
• Bathtub vs. Standing shower only (for if you have kids or simply want to be able to use bath bombs) 

Happy Halloween everyone! Hopefully you get to enjoy some candy and fun tonight. Today's post is about financial fears, how they can affect your day to day life, and simple ways to ease your worries about some of these challenges. First, check out this infographic from a recent survey on Wallet Hub by John S Kiernan:

2019 Halloween Spending & Financial Fears Survey

https://wallethub.com/blog/halloween-spending-survey/53821/

As the survey shows, money was the top category that scares people (even over politics, yikes). With the biggest financial fear being unplanned emergencies, followed by lack of retirement funds. As a recent college graduate, there are many financial issues that can be cause for distress. Sometimes it seems like there are so many factors to think about when it comes to my money, it can be a little overwhelming. So, let's address a couple of common "fears" for young adults just starting out.

Scarcity mindset

With a small paycheck coming in, sometimes it can seem like spending money on "non essentials" is always a waste of money. This is especially true if you have a lot of bills to pay, debt, and high price items you are trying to save for. However, it's okay to treat yourself sometimes and spend money on activities that keep you happy. You risk burn out creeping in if all you do is work and stress about money. Make time to do things you enjoy and treat yourself occasionally.

FOMO

Love doing stuff with your friends but not the price you pay to do it? This is kind of the opposite of the scarcity mindset. When you are young and see your friends doing all sorts of fun things and they invite you to do them as well, it can be hard to say no and miss out on the fun. If you are worried that you spend too much money with friends when hanging out, try suggesting options that don't cost much money. Hiking is an awesome option if you enjoy the outdoors, the weather is perfect for it right now. You could also try out a girl’s night where everyone brings wine and an appetizer. Those fun wine painting classes can be done easily (and cheaper) at home if you pick up a few supplies from the craft store.

Debt

Student loans keeping you up at night? Get all your loan information together and determine how much you need to be paying off each month. Research the best options for student loan repayment and work it into your budget.

Big Expenses

When you are just starting out, the idea of having enough money to buy a car or a house can seem insane.  Start by doing some research and figuring out how much you would need for your purchase. Then, set yourself a goal of how much to save and by when. Then, looking at your budget see how much you can reasonably set aside each month towards your goal. If you aren't able to set aside as much as you would like, the next time you get a raise, put the extra money from that towards your goal.

With any of these issues, including the first I mentioned, it all comes down to proper planning. Having a solid emergency fund to fall back on can ease a lot of worry. Starting to save for retirement at a young age (the younger the better) will encourage you to keep it up as you and your salary grow. Even if you can only put away a small amount each month, get into the habit of doing so. Review your savings plan when you get a raise or a new job and see if you can be putting any more away.

Fears go away when you face them head-on.  The best time to start tackling them is right now.  Happy Halloween!!

Health insurance as a young adult is so important. As I mentioned in a previous post, keeping up your insurance when you are young and don't have a lot of money is one of the best things you can do for yourself. When you are on a tight budget, it can be hard to think about paying for multiple types of insurance each month. Realistically though, if you get into an accident and your car is totaled or you require a hospitalization, you will be so happy for that insurance.

Does your job provide health insurance? If so, it's typically cheaper to go with your company plan than it would be to search on the open marketplace. However, if you want to search for an alternative plan you can.

Open Enrollment Friday, November 1- Sunday December 15, 2019

Health Insurance Marketplace:

• For those who do not have insurance through a job, Medicare, Medicaid or CHIP
• If you have insurance through your job, plans through the marketplace will be full price unless your coverage at work does not meet certain standards

Insurance offered through an Employer:

• Often cheaper because they are group plans
• Choose between plans available through your employer

Individual Plans:

• Plan is not tied to a job
• Can choose the insurance company you want and choose a plan with the doctors and hospitals you prefer
• Change plans during open enrollment on the open marketplace

Basic Health Insurance Terms to Know:

• Copay: predetermined rate (flat dollar amount) you pay for health care services in addition to what is paid by the insurance company
• Deductible: amount you must pay before an insurance company will pay a claim
• Maximum Out of Pocket Cost:the maximum you have to pay for covered services during the year (note the word covered here)
• Premium: Monthly amount paid for the insurance coverage
• Coinsurance: percentage of the claim payment that the insured must pay

Health care is expensive. Many people avoid going to the doctors because of the cost of health care. However, this can lead to some conditions going undiagnosed and you risk getting really sick. Most insurance will cover preventative care at little or no cost to you. So even though you are young and healthy, take advantage! Keep up with yearly doctor's appointments and get your flu shot.

For more information regarding the Health Insurance Marketplace go to:

https://www.healthcare.gov/

Have you seen an ad for some type of subscription service today? Most likely the answer is yes. From streaming services to clothing companies, it seems like everyone has made a subscription service. A study by Forbes found that among the most popular subscription services in 2018 were Ipsy, Dollar Shave Club, and Amazon Subscribe & Save. While a couple dollars a month for a service seems fine, most of them add up to at least a $100 a year and having multiple subscriptions can mean hundreds of dollars spent over the year.

Do you really need it?

• Think about the Latte Factor here (discussed in the "Worried About Your Latte?" post previously).
  • That small number builds up over the months and if you have multiple subscriptions, think about cutting down to save money throughout the year.
• Subscription services know how to market their products these days. Their ads make it sound like such a great deal that you can save so much money with. But realistically, take a step back, and ask yourself "Do I really need or really want it?"
• I've found myself logging onto some sites because I've seen an Ad that looked really cool. They show the product value as double what you pay, and everything looks so neat. Then I really think about it and I realize I wouldn’t use half the stuff in the box. It's the fun of receiving the package and looking at everything that draws me in, but I realize I'd rather save the money to buy myself one thing I really want later on instead of a bunch of random things I don't really need.

Too Good to Be True?

• I see more and more monthly clothing boxes popping up. Some of them seem like such as good deal at first. You need to look at all of the small print though. Most automatically charge you for their service at the beginning of the month and a lot do not have an opt out option.
• Ask yourself if you would really be spending that much money on clothes from their website each month. It might be worth it if they are clothes you really enjoy, and you won't be buying other clothes. However, you need to look at the quality of the clothing as well before signing up.

Not All Bad

• This post isn't supposed to make you cut out every single subscription, it's simply to try to get you to look and see if you really need all of the ones that you currently pay for or are considering getting.
• Cable packages can be pricey, $12 for a Netflix subscription per month would save you money compared to an entire cable package.
  • With so many streaming services popping up now though, try not to get hooked on too many because you'll just pay more and more each month.

Every couple of months, re-evaluate if you are still enjoying the service. Before getting another subscription see if it can replace an existing one to offset the cost. Overall, if you just stick with the subscriptions you really need or really want and they fit within your budget, go for it and enjoy.

For more facts about how much the "subscription economy" has grown check out this article by Forbes:

• https://www.forbes.com/sites/louiscolumbus/2018/03/04/the-state-of-the-subscription-economy-2018/#40490b1453ef

It's officially fall! Doesn't quite feel like it yet, but we'll get there soon hopefully. With the holidays fast approaching, now is the perfect time for some fall cleaning and preparation.  Why should we save our big cleans for spring? Fall and winter are jam packed with holidays and events, so it's a perfect time to get organized. I recently read a book that inspired me to finally tackle cleaning out my closet. The book was about spending less and appreciating the clothes you already have by getting rid of what you don't wear. When I was done, it felt so nice to have everything organized and I could actually find the clothes I wanted to wear.

Here are a couple of suggestions for some fall cleaning for yourself:

• Look back on your budgeting
  • How have you done with your budget and goals throughout the year?
  • Are there any goals that you haven't made a lot of progress towards?
  • Re-evaluate your goals and make adjustments.
  • Be kind to yourself and realize that life happens, so if you haven't gotten as far along with a goal as you wanted, figure out why and see if you can change anything to help yourself achieve it.
• Clean out your closet as well!
  • As we go into a new season, take note of anything that has seen better days and may need to be replaced. This way, if you are shopping, you'll already know what you do and don’t need.
• Looking towards the end of the year
  • Are there activities that you do every year or a certain one you just really want to try this year?
  • It's a great idea to look ahead at the next couple of months to see if there are big or small events that you should budget for.

• Gift planning
  • Gifts can be a sore spot for budgets because unless you have an exact item in mind it's hard to know exactly what you want to spend.
  • Think about any upcoming birthdays, events, or holidays that you will need gifts for and set yourself and overall budget, then start figuring out what you want to spend on each person/gift.
• Hosting
  • Are you planning on hosting family or friends for the holidays?
  • If you are on a tight budget, planning out your meal in advance will help you save money and stay on budget.
  • If you are hosting a night for friends, consider doing a pot luck where everyone brings a dish to save you time and money.

Have fun!

This time of year is packed full of fun activities and events so join in! Trying to stay on budget can make it stressful when you want to enjoy the season, so get all of your planning done early, leave some wiggle room for random things that come up, and enjoy time with family and friends.

Happy National Life Insurance Awareness Month! Hopefully I didn’t just lose everyone reading this. I know insurance of any sort is a hard topic when you're young and don't have a ton of money. However, insurance is even more important when you don't have a lot of extra cash. Trying to learn about all the types of insurance you may need and figuring out how much to get can sometimes be overwhelming. Take it one step at a time and start learning about your personal needs to see what will work best for you.

Types of Insurance:

Compulsory insurance (has a minimum requirement)

• Health insurance
  • Minimum requirement set by the Affordable Care Act.
  • Various levels of health insurance to pick between.
  • While you may think being young and healthy means you need very little health insurance, there are many things out of your control that could cost you a lot should they happen.
  • Figure out what you want your out of pocket maximum to be to see how much insurance you feel comfortable paying for.
    • In a future post I will get more into how to pick what type is best for you.
• Car insurance
  • State by state minimum requirements.
  • The minimums are often not enough coverage, so do your research to see how much you need.
  • The more coverage you have, the less likely it is a plaintiff will go after your other assets.
  • Generally, the more assets you have, the more car insurance you want.
• Home owner's insurance
  • Insurance companies will often not fully cover the cost of damage to a house unless you have at least 80% of your home's value in coverage.

Other types of insurance to consider:

• Life insurance
  • Do you have someone else depending on your income?
  • Life insurance is less expensive when you are young and healthy. 
  • If you wait and apply for life insurance later in life, you could be denied for many reasons.
  • Partially replaces your salary if you can’t work (this insurance is important for most of your working years for everything from accidents to long term illness).
    • Could you cover your expenses if you couldn't work for a while?
• Renter's insurance
  • Covers your personal belongings from possible events listed in the policy
  • If there was a fire at your apartment could you afford to replace what was lost by yourself?
• Travel insurance
  • Good idea for more expensive trips.
  • Some credit cards offer forms of complimentary travel insurance.
  • If a hurricane or illness ruins your vacation plans, would you be out a couple of thousand dollars?

An inexpensive way to get started outside of the insurance you buy yourself:

• Insurance provided through an employer, either employer paid or employer offered.
  • Fees through group plans can be cheaper, but this insurance is often not portable if you change jobs so be aware.

• Also, small amounts of insurance can sometimes be included with credit cards at no cost such as the travel insurance mentioned above. 

• If affordable, pays to get some insurance while younger as rates are cheaper and your health is still good.

It's impossible to insure for every event in life

Insure your biggest risks first that would be most catastrophic to you. Regardless of what type and how much insurance you get, always make sure you know what is covered and what type of restrictions there are. Lastly, each year or if any big events happen (like having a baby or one partner deciding to start their own business) re-evaluate your insurance needs. As you grow and life changes, your insurance needs will change as well.  Oxford Planning reviews insurance as part of your overall financial planning.  Call us with questions – we’re here to help.

Have you heard of the latte factor recently? The concept has been around for years and recently a book was released called The Latte Factor by David Bach, that has become pretty popular. If you google "finance latte" you'll get tons of different articles related to this idea. So, what's all this buzz about?

Why Coffee?

Latte’s have become the icon for saving money lately because it’s a common indulgence. Many of us are willing to the pay extra money to buy it in a coffee shop for either convenience or the simple pleasure of the routine. 

What's Your “Latte”?

As I said above, your daily cup of coffee isn’t under attack, a latte is simply an icon right now. The bigger message is to be mindful with your money during the week - and realize that small costs can add up to a lot of money if bought often.

Mindfulness

Are you into the minimalist or mindfulness movements? Every time I look at new books there are so many on these topics it’s overwhelming. However, mindfulness is what the base of the Latte Factor is all about!

• Take a good hard look at your spending. Do you like online shopping for clothes? Maybe you use Uber Eats multiple times a week? Identify what you are spending your hard-earned money on and determine if it's really worth the cost.

Enjoyment versus Price

If that cup of Starbucks every morning is what makes you look forward to work and keeps you sane, then go for it! But first, try some cheaper options like making it at home with some fun ingredients. If it's not for you after a couple tries, then maybe consider only buying coffee twice a week as a special treat. Whatever works best for you and keeps you and your wallet happy.

Change Your Mindset

By being mindful about what you’re spending, you can evaluate what’s most important to you. A common phrase I hear is that people want to contribute money into the retirement plans offered by their workplace; but retirement seems so far away and they don't have extra money to put in.

• By looking at your spending, maybe you can find an extra $50 a month that you would have spent on eating out to put into your 401(k) plan. It's great to get into the habit while you are young of putting money away every month for retirement even if it's a small amount at first.

So figure out what your latte is today and see what that money could add up to over a year, two years, or even more!

Let's talk about goals! Everyone has them, but how measurable are yours? In financial planning, a goal should have three parts: Purpose, Time, Amount (PTA). By having these three things, your goals will be measurable and realistic. For example, everyone I know wants to travel right now while we're young, but - it's hard to find the money.

Look at these two goals:

Goal 1: “I want to travel to other countries soon!”

Goal 2: “ I want to travel to England, Scotland, and Ireland in two years and I want to save $6,000 for it.”

 Which one of these goals seems better? Goal 2! It has the PTA all written out. By setting these ideas, you give yourself the purpose to work towards instead of a general idea, you give yourself a time frame to save during, and you have a total amount of money. It can be a little daunting to try to save a lot, so having a set goal that you can see yourself chipping away at is really rewarding.

Step 1: Making your goals!

Take an hour one day and sit down with no distractions. Grab some pen and paper and start writing out some goals that you have for your future. Start with some general ideas and work your way to more specific thought out goals.

 Here are some common goals for recent post-grads like me:

• Emergency fund (4-6 months living expenses)
• Travel Fund
• Down payment for a house

 Step 2: Set your Time and Amount

 Look at your salary and mandatory expenses to see how much you can save every month towards your goals.

• Save for your most important goals first! (Emergency fund should be at the top of your list)
• Short term vs. Long term goals: Consider which goals you have less time to save for and determine how much you want to put towards each goal

 Don’t Forget About Retirement

• While thinking about all your goals, don’t forget about setting aside money for your retirement accounts and FSA or HSA accounts for medical bills

 Staying on Track

• Set up automatic savings withdrawals
• Don't skimp on everything you want to do just to save more money but - do pause and take a moment to think about what things are worth the money and what you can pass on

Re-evaluating

• Every couple of months sit down to take a look at your goals.
  • Are all of them still valid things you want?
  • Have you been able to stay on track without depriving yourself?
• Salary increase? Take a look at what you can be saving more for!

It’s so easy to have fun and let that paycheck slip right out of your wallet without planning.  Get started today – you’ll be so glad you did!

Buying a car is a big decision. You want something reliable, spacious enough for your needs, and preferably in a style you will enjoy for years. A big part of this decision can be whether to buy a new car or a used car. As a young adult, there are so many things to be saving for. While a car is most likely a very necessary purchase, you don't want to spend extra money you didn't have to that could be saved for a home or travel fund. Let's look at some of the pros and cons for buying a new car or a used car.

Buying a New Car

Positives

• No history: you don't have to worry about looking for accident histories or wear and tear
• Latest technology: each year’s cars are coming out with new technology to make you safer and make your drive more enjoyable
• Newer cars can be more fuel efficient
• Can pick and choose what features or color you want 

Negatives

• Depreciation: a car’s value depreciates the most in the first 3 years
• Higher auto insurance cost for higher cost vehicle
• Tech makes repairs more expensive
• Must be bought through a dealer: if few dealers around, ability to negotiate price goes down
• Sales tax: taxed on entire price you pay: meaning a more expensive car will cost more in taxes

Buying a Used Car

Positives

• Less expensive: the upfront cost, auto insurance, taxes, and interest can all be less
• No big depreciation hit: new cars lose value the moment you drive it off the lot
• Easy to explore a car’s history with the use of companies that give out history reports
  • Title history, record of maintenance, number of owners, collision and repair info
• Reliability record: used car rankings and reviews can help determine which cars will requite less maintenance, hold value best, and save you money overall
  • https://cars.usnews.com/cars-trucks/rankings/used

Negatives

• History reports are thorough, but they are not perfect
• Used cars sold as is: can't return if it has unexpected problems
• Limited or no warranty coverage
• Can't be as picky: may have to compromise on a few things such as color or mileage

Check out this video from Bank of America that breaks down the cost comparison even further:

https://bettermoneyhabits.bankofamerica.com/en/auto/buy-new-used-car

Certified Pre-Owned Vehicles

• Blend some of the advantages of new and used cars
• Gently used, usually only a few years old, low mileage, and no major accidents
• Closely inspected
• Typically, leased returns or vehicles driven by employees of the dealership
• Can get special low interest financing deals on CPO cars

Reminder: Keep your credit score high!

• Your credit score can affect
  • Your ability to get a car loan
  • The interest rate given to you

Regardless of whether you get a used or new car:

• Make sure your credit score is high
• Have a down payment ready to decrease the loan amount you need
• Do your research to figure out what you really need in a car and what you can go without

Safe travels - whichever you choose!

With the Equifax hack settlement promises coming out and the recent Capital One hack, many people are wondering how safe their credit is. Even if your credit hasn't already been leaked, it may be a good idea to freeze your credit as a preventative measure. Fortunately, after the Equifax incident, a federal law was passed to make freezing your credit free.

Why Should You Freeze Your Credit?

It seems like credit breaches are becoming more and more common and each time millions of people can be affected. Freezing your credit protects you by making sure no one can open credit in your name. It does not hurt your credit score, it simply blocks new applications.

When Should You Not Freeze Your Credit?

If you are trying to open a new credit card or thinking about applying for a loan soon.

• Fortunately, federal law states that if a request for a temporary or permanent unfreezing of your credit is made online or by phone it must be unfrozen within one hour. So, if you freeze it and then want to apply for credit later, it should be quick to undo.

 Things to Keep in Mind

• To freeze your credit, you need to contact each of the three credit bureaus (follow the link below to the FTC website).
• Parents can freeze credit for kids under 16.
• Freezing your credit only stops someone from opening a new account in your name, current account information is still susceptible to fraud so keep an eye on currently open credit accounts.

More experts are recommending freezing your credit to give yourself a better chance at protection from fraud.  Weigh the options of convenience versus security and decide for yourself.

Resources:

https://www.consumer.ftc.gov/articles/0497-credit-freeze-faqs

What does financial planning mean to you?

When you hear the term "financial planning", what do you think of? I don't think most people often associate the term with young people. That's a big problem though because early financial planning can have lifelong benefits. Financial planning goals can vary depending on your age. Look below to see a list of some common goals for young adults.      

• Paying off Debt
  • Student Loans
  • Credit Cards
  • Car Loan
• Emergency Protection
  • Emergency Savings
  • Disability Insurance
• Future Savings
  • Retirement
  • Big Purchases (Home)

Paying off Debt

• Take a look at any debt you have and determine how much you can afford to pay off each month and give yourself a target date to have it paid off by.
• Keep credit card debt as low as possible, ideally pay off your entire balance on time every month.

Emergency Protection

• Start building up some emergency funds for when your car breaks down or you drop your phone in the toilet (it happens!).
• Disability insurance - not a lot of young people consider this a need; however, what would happen if you injured yourself tomorrow and could no longer work?
  • Whether or not you work in a high-risk job, disability insurance is worth the cost.
  • Generally, costs about 1-3% of your salary

Future Savings

• Large future purchases- start saving now to meet your goal quicker
  • If you know you want to buy a house at some point, start saving for a down payment of at least 20% of the home price to avoid having to pay private mortgage insurance and save yourself money.
• Start investing for your retirement! You are never too young to start putting money into a retirement account. We can’t impress enough how compounding interest can do wonders to help grow your retirement account balance and the earlier you start, the more time you give your money to grow.

Set aside a couple of hours on the weekend and start your own financial planning as soon as you can. By understanding your personal finances and giving yourself goals, you are giving yourself the greatest shot at success in the future.