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Consumer Archive

Consumer

These 7 features help sell your home

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WASHINGTON, D.C. (6/24/14)--You might be reluctant to make upgrades when you're ready to sell your house. After all, you won't be in the house to enjoy them for long. And most projects recoup only 66% of their costs, according to the 2014 cost vs. value report from Remodeling magazine (Kiplinger May 2014).
 
But complacency can mean your house stays on the market for months--time that costs you money. That's why these seven updates that rank high on buyers' wish lists, culled from the National Association of Home Builders' (NAHB) "What Home Buyers Really Want" report, are worth considering:
  • Laundry room. More than half (57%) of buyers say they don't want a house without this feature; 93% want separate laundry space.
     
  • Exterior lighting. Nine of 10 buyers want this amenity--the most-wanted outdoor feature.
     
  • Energy-efficient windows. Energy Star-rated windows turn up on 89% of buyers' priority lists. These windows can help reduce energy bills up to 15% by reducing undesirable heat gain and loss in the home.
     
  • Roomy garage. Eighty-six percent of buyers want bonus garage space that's accessible and organized.
     
  • Eat-in kitchen. This is especially important for families with children; 85% of buyers expect it.
     
  • Walk-in pantry. Another 85% are looking for pantries with built-in organization systems to keep food and preparation items out of sight. It's a bonus if your pantry doubles as a broom closet.
     
  • Wireless security system. Fully half (50%) of buyers are looking for homes offering modern conveniences, and wireless home security systems rank the highest among technology features buyers would like to have, according to NAHB.
For related information, read "Want Top Dollar for Your House? Apply Elbow Grease" in the Home & Family Finance Resource Center. That story reports that, in a 2012 survey of real estate agents, almost 90% said home improvements can help sell a home faster, and nearly 73% felt home improvements could boost the sales price--if they are the right improvements.

Guide helps fight financial exploitation of assisted-living residents

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WASHINGTON (6/23/14)--The Consumer Financial Protection Bureau has released an new and extensive guide intended to help the staff of assisted living and nursing facilities to protect residents from financial exploitation.

The guide gives staff the tools to:
  • Prevent financial exploitation and scams by educating staff, residents, and family members about warning signs and precautions;
  • Recognize, record, and report financial abuse as early as possible using a model protocol and a team approach; and,
  • Get help from first responders in the community.
The guide includes pages of warning signs that a resident may be falling victim to exploitation.  It also lists the current, most-frequently used fraud and scam schemes that target older people--relative-in-need, sweepstake winner, charity appeal, home-improvement scam among them--but warns that schemes are always morphing.

The guide includes information about the Federal Trade Commission's "scam alert" page, which has information about the ever-changing ways that scam artists target consumers and is located at www.consumer.ftc.gov/scam-alerts.

Use the resource links for more information.

Your HSA could supplement retirement funds

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NEW YORK (06/17/14)--For healthy Americans, the best use of health savings accounts (HSAs) might be as supplementary retirement accounts, and not for paying medical expenses (Wall Street Journal June 2).

HSAs were created to help consumers save for medical expenses. They also provide powerful tax shelters. In 2014, a married couple can put away as much as $6,550 ($3,300 for an individual and, if age 55+, individuals and couples may save an extra $1,000) and have all or some of that money grow in tax-deferred investments.

If you open an HSA, you may use the money to pay for deductibles, co-pays, and other medical expenses. After age 65 you may withdraw the money, penalty-free, for nonmedical use. The money will be taxable at that time but you still will have benefitted from years of tax deferral.

To qualify to contribute to an HSA:
  • You can't be enrolled in Medicare. At age 65, if you switch to Medicare coverage you no longer may contribute to an HSA.
  • You can't be a dependent on someone else's tax return;
  • You must be covered under a qualifying high-deductible health plan (the 2014 deductible minimum is $1,250 for single coverage and $2,500 for family coverage); and
  • You may not have any other health coverage, but you can have dental, vision, disability, and long-term care coverage.
An HSA provides a triple tax benefit:
  • Your cash contributions to the account are 100% deductible;
  • Interest on savings accumulates tax-deferred;
  • Withdrawals from an HSA for qualified medical expenses (see irs.gov) are free from federal income tax;

At death, your HSA passes to your designated beneficiaries. It's tax-free for your spouse if used for qualifying expenses, and taxable for anyone else.

Because of the contribution limits, for many people an HSA will play only a minor part in paying for health-care costs in retirement. However, if you have good cash flow and liquidity, and are able to leave the money in the account, you could benefit from having an HSA and using it to supplement your retirement savings.

If you're employed and part of a group medical plan, ask your employer about an HSA. For others, many credit unions and other financial service providers offer HSAs. Compare fees and features across providers.

HSAs are complex and, if not administered properly, can cause adverse tax consequences. Make sure you understand plan details.

For related information, read "Everybody's Money Matters: Benefits of Health Savings Accounts" in the Home & Family Finance Resource Center.

Couples: Credit score conversation is critical

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SAN FRANCISCO (6/10/14)--Betrothed couples talk about everything from the style of house they'd like to live in to names of future children, but conversations about finances sometimes get left by the wayside.
 
A new survey from Experian finds that credit scores are the No. 1 financial topic couples don't discuss before tying the knot. Even though roughly 75% of engaged couples talk about spending habits and student loan debt, only 43% talk about credit scores (MarketWatch.com June 2).
 
One of 10 couples don't talk about credit scores even after they've wed. Whether you're embarrassed about being a shopaholic or the topic just hasn't come up yet, it's important to share credit score information before settling down:
  • Check credit reports. Look at your credit reports together. You can check your credit report from each of the three major credit reporting agencies once a year for free. Always make your requests from annualcreditreport.com, the only site sanctioned by the Federal Trade Commission. Or, you can call 877-322-8228. Make one request every four months in rotation among the three credit agencies to monitor your credit report year-round. Call credit issuers to dispute unauthorized items on your report.
     
  • Boost your scores. Once you've discussed why credit scores are low, make a plan for boosting them: Create automatic reminders so you remember to pay bills on time, pay down credit card debt, and talk to each other before opening new credit lines. If you decide to open a new card, choose one that has a low rate and low fees; make your credit union the first stop. Credit union credit cards typically have lower rates and fees than other financial institutions. If you're not already a credit union member, visit asmarterchoice.org to locate a credit union in your area.
     
  • Talk frequently about finances. Now that you've come clean about your finances, keep communication lines open in the future. Schedule time each week to sit down and talk about money. If you have kids, plan an inexpensive date night for just you and your spouse to talk about financial topics.
According to the Experian study, married couples say that financial responsibility means more (95%) than physical attractiveness (86%). That alone should be good reason for mutual honesty about credit and other financial matters.
 
For related information, read "Clean Up Your Credit Report" and the Turning Point "Put Your Financial House in Order before You Tie the Knot" in the Home &Family Finance Resource Center.

Scammers get at seniors' money via their phones

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NEW YORK (6/3/14)--While scams keep changing, the targets stay the same. Seniors continue to be the marks of a variety of low-risk crimes that prey on their sense of duty and exploit their fear of cognitive loss (The New York Times May 23).

One recent scam involved someone posing as a courthouse clerk calling to inform a potential target that she had failed to show up for jury duty. If she didn't immediately pay a fine, the caller warned, police would show up at her house to arrest her.
 
The Federal Trade Commission's Bureau of Consumer Protection logged 1.1 million consumer fraud complaints in 2013; 47% of the victims were age 50 or older, with a median payout of $400 per complaint.
 
Retirees make ripe targets because they have access to cash via retirement savings and equity in their homes.
 
Here is what to do to avoid being targeted:
  • Ditch the landline. One reason seniors are targeted is because they still use landlines--so they're easy to find through commercially sold phone lists--and they often answer their phones. The most common way scammers make contact is by phone, which accounts for 40% of all fraud contacts, up from 30% two years ago.
     
  • Sign up for the AARP's Fraud Watch Network alerts and check its online map. This will help you keep up to date on the scams happening where you live, as scammers frequently change the areas they're targeting.
     
  • Call the U.S. Senate Special Committee on Aging Fraud Hotline. If you suspect someone is a victim of fraud, call the hotline (855-303-9470) where fraud investigators can offer advice about how to proceed.
     
  • Hang up. Whether it's a purported relative imploring you to send money right away or a sweepstakes requiring you to pay taxes in advance--two common scams--say you'll call back. Then research the situation. If the caller is putting pressure on you to pay immediately, it's a scam.
For related information, read "Identify Signs of Elder Financial Abuse" in the Home & Family Finance Resource Center.