Here are 5 more things you should know.
01. Useful Financial Provisions
A lot of personal finance advice is straightforward applications of math: Keep expenses less than income. Pay off highest interest rate debts first. Compound growth is your friend. Then there are obvious legal requirements and benefits: Use tax-preferred retirement / HSA accounts. Keep insurance in force. Know how self-employment taxes work.
This post is about less-obvious but still interesting ways to use provisions/benefits in existing US laws to your advantage. There’s an endless number of these, but some come into play frequently enough that it makes sense to raise awareness about them.
Here are some that you may not already know about:
· If you earn less than 30K single/60k jointly, you can use the Saver’s Credit to get a tax credit for a portion of your IRA or 401k contributions, even for Roth contributions. Full-time students are not eligible.
· You pay no taxes at all on long-term capital gains if your taxable income (including those gains) is less than the top of the 15% tax bracket. That could be $95,000 gross income for a married couple filing jointly. This is better than a Roth in that you can do this at any age.
· Sales of a personal residence often have no capital gains tax as well. Various rules apply.
· If you rent a room in your house, part of all of your housing expenses (including insurance and utilities) can be Schedule E expense deductions against your rental income (but you need to declare the rental income).
· Take advantage of “adjustments” like student loan interest, tuition, moving costs, etc., that don’t require itemization if you are eligible.
· Employer contributions to your 401k don’t count against the 18k limit.
· If you change your mind about making an IRA contribution, e.g., your income becomes too high for it to be allowable, you can simply remove the money before the tax filing deadline without penalty.
· For people with more “life experience”, you can increase your contributions to a 401k and IRA at age 50, and your HSA contributions at age 55.
· Self-employed people have lots of options for retirement accounts. This can apply even if you have employment retirement savings.
· [Edit: Think you make too much to contribute to Roth IRA? Think again! The ever-popular Backdoor Roth IRA may work for you. [But no, I am not adding the Mega-Backdoor Roth. There are some places even I won’t go.]]
· If you change jobs and don’t have insurance coverage for a time, you have 60 days to elect continuing (COBRA) coverage. This works retroactively; you can decide to take COBRA at day 59 and be covered for the previous 59 days. (Yes, we get that COBRA is expensive. But it’s free if you wait to elect it and don’t need it, but you’re still covered because you can elect it retroactively. Any other health insurance you’d have to pay for but probably still not use).
· You won’t pay a penalty for lack of health insurance if you have a single brief coverage gap, which is defined as “less than three months.” I.e. May 1 to July 28 is Okay. May 1 to July 31 is not.
02. If you get a call reporting fraud on your credit card…
And you are asked to put in your card number then it is the call that is the fraud. The caller asks if you are the card holder for xxx card, or to have the card holder call. It then does the “espanol” question followed by a “transfer” where you have to put in your card number to get more information.
The general rule for unsolicited calls or emails is that they should provide some sort of identifying information so you can confirm they are who they say they are. It should be more than name or address. If not, hang up, or delete the email.
It’s pretty amazing what information people will volunteer if you convenience them you have more power than you really do. An overwhelming majority of success in compromising someone’s security occurs from Social Engineering. The main tactic is to inspire a sense that “this is a unique situation and normal rules don’t apply”. In this case making you panic that your card has already been defrauded is the angle. In general never give your password, card number or other sensitive data out without verifying the identity of the person contacting you. Usually this involves something like telling you the type and last 4 digits of the card in question to prove they know what it is. If you’re ever unsure hang up and call the number on the back of the card yourself and ask whoever answers.
03. Your Android phone can act as a WIFI receptor for your desktop/laptop
Although a very niche tip, this has helped me with problems before. With a USB cord plug your phone to your computer. In phone settings under Wireless and Networks, click more, Tethering, then USB tethering and follow the phone from there. This method allows you to use WiFi whereas hotspot forces you to use data.
04. Borrowing books from UK and Irish libraries directly supports the author
You don’t have to buy a book to help!
Assuming the author is registered for Public Lending Right, which many are, they will regularly receive a check that correlates to how many times their books were loaned out in libraries across the country.
Many authors rely on their income from PLR to keep going, and the money they receive can be a huge boon. I know for a fact there are some great second and third books out there that wouldn’t exist without it.
The money comes from a government fund, so it’s really important to visit libraries and make sure your local MP knows you want your local library to stay open.
05. The 2×10 method of breaking through to people who don’t like you
It’s a technique used in education to reach “at risk” students with behavior issues but it works equally as well on adults like problematic coworkers or bad neighbors.
Simply spend 2 minutes a day for 10 days straight having a one on one conversation asking about them with nothing to do with the context of how you are connected, i.e., ask the problematic coworker anything about themselves that has nothing to do with work.
It works like a charm for building relationships with whom you’ve basically written off.