Knowing Your Financial Bad Habits

By Trilogy Financial
July 23, 2019
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The road to financial independence isn’t always a smooth one. There are plenty of things that can pop up and derail us from our goals. Sometimes it’s an unexpected turn of fortune, like a sudden loss of a job or a medical crisis. More often than not, though, the things that derail us from our financial goals are our own financial bad habits.

There are a lot of financial bad behaviors that plague every-day Americans: impulsive purchases and overspending, not living within your means, lack of a financial plan for emergencies and the future. One of the most challenging aspects of financial bad habits is how unassuming they seem at first glance. Most of these bad habits appear to have a minor impact in the moment. Yet, living years with these bad habits left unchecked can do more damage to your long-term financial health than some of these situational detours, like the loss of a job or a medical crisis.

Awareness of these bad habits is the key to kicking them. Once you identify what they are, you can put steps in place to work against them. Not sure where your money is going? Make a budget and make sure that where your money goes reflects your values. Are you an over spender? Perhaps avoid those spending triggers like a mall or online vendors and give yourself a cash allowance rather than utilizing credit cards. Do you need to put more money away for an emergency fund or investments? Have money automatically transferred every month to ensure that you’re paying yourself first.

If you’re not sure what your financial bad habits are or how to fix them, working with a financial advisor might be your best course of action. Having a third-party look over your financial house and habits can help identify unhelpful behavior or areas of improvement. Our Decision Coach program was especially designed for those folks who may need some additional accountability and coaching. In fact, if one of your financial bad habits is lending money you can’t afford, a financial advisor can be a great scapegoat as to why you have to start saying No. We don’t mind being the “bad guy” to your loved one if that helps you stay on your path to financial independence.

The path to financial independence can have some pot holes, the most significant being our own self-sabotaging behaviors. However, the proper awareness can bring change. Changing any type of behaviors take time and support, and we’re happy to help those who are committed to helping themselves.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

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By
June Adams
January 31, 2022

Tax-related fraud and identity theft have continued to grow, with millions of people becoming targets. Scammers need little more than your Social Security number and other general information to file a fraudulent tax return and hijack your tax refund. Taxpayers typically don’t discover the fraud until they attempt to file their own returns, which is why it's essential to file taxes as soon as possible. At the same time, you may want to confirm the appropriate timing with your tax professional. Although 1099s are due by the end of January, custodians may correct 1099s throughout February. If drastic changes happen to a 1099 after you file your taxes, the change can severely impact the amount you owe.

 

Here are some helpful ways to prevent your SSN from being compromised:

  • If you have been a victim of identity theft, complete  IRS form 14039, identity theft affidavit.
  • Respond immediately to any IRS issued notice once you verify the authenticity of the notice. You can do so by calling the IRS directly at 800-908-4490 or setting up your  online account.
  • Get an Identity Protection PIN: a 6-digit number that prevents someone else from filing a tax return using your Social Security number or individual taxpayer identification number. Only you and the IRS know the IP PIN.
By
Jeff Motske, CFP®
August 31, 2018

There are some great advertisements that show you retirees traveling, gardening and enjoying their hard-earned reprieve from the workforce. It gives a great glimpse of how good retirement can be, giving folks something to strive for. However, it’s not the only reflection of retirement. Sometimes there are valleys to go along with those peaks, and one of the most distinct valleys that are experienced in retirement is mounting health care costs.

The financial weight of health care can start off with small steps, or small pills to be precise. Nine out of ten people 65 and older have commented that they have taken at least one prescription drug within the last 30 days.1 As health issues progress, so can treatments, with some people having multiple medications and continuous appointments, not all being covered by private health insurance. According to an annual estimate conducted by Fidelity, the average retiring couple “will need $280,000 to cover health care and medical costs”.2 While many expect to rely on Medicare for their health care costs, the program is not comprehensive. Fidelity’s figure includes deductibles, cost-sharing requirements for certain medications, as well as services and devices that Medicare doesn’t cover, like hearing aids. For the unprepared, these figures can be staggering.

Those who are unprepared can, unfortunately, find themselves sliding into practices where they are not taking care of themselves in retirement. According to the 2018 Economic Well-Being Report, a quarter of adults went without needed medical care because they were unable to afford the cost.3 Those who do go in for medical care can be overwhelmed by mounting medical costs. According to a study done by the Consumer Financial Protection Bureau, “43 million Americans owe a medical debt.”4 Stress-induced by medical issues combined with stress over mounting medical costs is not what people expect to experience in their retirement.

The key to good retirement planning isn’t to plan to maintain your current lifestyle. It is to plan for possibilities and scenarios that may not seem likely today, but that statistics show could impact your tomorrow. While these statistics can be very overwhelming, if you start saving early and work with a trusted financial professional, you can be fully prepared to enjoy your retirement. In the end, you need your finances to be in good health for those moments when your body can’t be.

https://www.iris.xyz/advisor/9-facts-about-retirement

http://time.com/money/5246882/heres-how-much-the-average-couple-will-spend-on-health-care-costs-in-retirement/

https://www.federalreserve.gov/publications/files/2017-report-economic-well-being-us-households-201805.pdf

https://finance.yahoo.com/news/4-tips-keep-medical-debt-overwhelming-174638865.html

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