Personal Finance

Photo: Tax Credits All tax-advantaged retirement accounts have rules for something known as the Required Minimum Distribution. Basically, these rules are in place to ensure that you take at least a minimal amount of money in withdrawals from your retirement accounts once you reach a certain age. For many people, the Required Minimum Distribution will never be an issue because they will be withdrawing more than their RMD from their retirement accounts. But if you meet certain criteria, you’ll have to know your account’s RMD rules and regulations. What Is the Required Minimum Distribution? According to the IRS, Required Minimum Distributions are the minimum amount that a retirement account owner has to withdraw each year starting at the age of 70 1/2 or upon retirement, whichever is later. For IRA accounts, however, the RMDs must begin once the account holder is age 70 ½, regardless of whether he or she is retired. The RMD rules are in place for all employer-sponsored retirement plans, including profit-sharing plans, 401(k)s, 403(b)s and 457(b)s. RMDs are also required for traditional IRAs, as well as SEPs, SARSEPs, SIMPLE IRAs and Roth 401(k) plans. One plan that’s exempt from RMD rules is the Roth IRA. You can choose not to take any distributions from a Roth IRA during your lifetime. When you die, the beneficiary for your Roth IRA will be required to take minimum distributions from the account. Why are there RMD Rules? US News and World Report points out that RMD rules are in place to ensure that the government can collect taxes on your retirement savings in a timely manner. Because withdrawals on most accounts are taxed, the government wants to be able to collect some of those taxes before your death. This is why the Roth IRA plan escapes RMD rules for retirees. The money in your Roth IRA account has been taxed and won’t be taxed again on withdrawal. So the IRS doesn’t care if you take distributions from a Roth IRA or not. When Does it Matter for You? As with all things IRS-related, rules for the Required Minimum Distribution are complex. Most of us will have to take the RMD on April 1 of the calendar year after which we reach 70 1/2 years old. So if you turn 70 on May 15, 2013, you’ll turn 70 1/2 on Nov. 15, 2013. So you’ll have to take your first RMD by April 1, 2014. However, this can become confusing if your half birthday falls at the beginning of the year. For instance, if you turn 70 1/2 on Jan. 15, 2013, you don’t have to take your first RMD until April 1, 2014, the calendar year after you turn 70 1/2. Here are some other rules you should know about: You must take the RMD from all (non-Roth) IRA plans, whether you’re retired or not. For 401(k), profit-sharing, 403(b) and other employer-sponsored, defined-contribution plans, the plan terms vary. For some plans, you can wait past the age of 70 1/2 to take RMDs if you’re still working. For others, you’ll have to take distributions based on your age, even if you’re still working. If you own 5 percent or more of the business sponsoring the retirement plan, you have to follow the age rules, regardless of whether you’ve retired. Once you start taking the RMD, you must withdraw your annual required minimum amount by Dec. 31 of each year. If the retirement account owner dies, the beneficiary will generally need to use the RMD the account owner would have received in the year he or she died. For the years following the account owner’s death, the RMD will vary depending on who the beneficiary is. As you can see, the rules can get a little confusing, especially if you have multiple types of retirement accounts. This helpful chart from the IRS may help clear up some confusion about RMD rules for different types of accounts. If you have questions, talk with your investment adviser and, perhaps, a tax professional to ensure you meet the legal requirements. How to Calculate Your Required Minimum Di

Whelp friends, we hit 5 Million page views earlier this month! How awesome is that? :) That’s almost a million for each year I’ve been blogging – pretty sick stuff (we’ve also had over 1,850 articles published and over 50,000 comments! CRAZY!!). I can kinda get now when people say “the first million is always the hardest,” haha… it’s true at least in the blogging world! With all these changes in my life lately, I’ve also been asking myself what the future will/should hold in terms of this blog. When you’ve been around the block for a few years certain questions start bubbling up, and at some point you have to listen to them. Things like, “Is this blog still doing what it was meant to do?” “Are people getting anything from it still?” “Am *I* getting anything from it still?” “Should I spend more time growing it or less?” And on and on… Now I don’t know the answers to all of them, but I can tell you I’m not ready to stop just yet regardless of the answers :) I do still enjoy rambling on to you folks, and I love confusing people when I tell them I blog full-time for a living, haha… And I DO think it’s still doing what it was supposed to back in the day – which is: To start conversations about money in an open and friendly environment. It may not have been that way at first (I was just trying to keep myself busy at work instead of getting on MySpace 24/7! Which tells you how long I’ve been blogging for, haha..), but over the years that’s what I’ve turned its mission to. Chatting about the good, the bad, and the ugly when it comes to our personal finances. Or rather, MY personal finances. I forget there was a time when I thought it was taboo to spill it all out in the open ;) It’s much more fun aired out! I also have to point out that after all these years the level of haters here still remains at an incredibly low level. Almost non-existent even, which is a tribute to YOU guys and shows y’all have some good respect for your fellow financial neighbor. I’m amazed at all the blogs I go to where people are bashing each other left and right, and I’m just SO thankful we don’t have any of that nastiness here on this site. We may get heated at times and disagree (which is great!! We love passion and perspectives!) but rarely do I have to go in and delete someone’s nonsense. SO THANKS  TO ALL OF YOU FOR BEING SO COURTEOUS AND NICE!!! There’s no way I’d still be blogging if I had to deal with jokers all day and night. You guys really are the best, I mean it. In fact, here… Let dig up my old prize for people I used to hand out back in 2008. These were fun to make when I had like a billion extra hours every week to play ;) Here you go: Click the picture or download it, and then print! Extra brownie points for snapping a picture of it on your wall or fridge or somewhere else cool :) It’s the little things in life that turn me on, haha… So I think things will stay business as usual here for the most part, but I do want to figure out a way to add even MORE ways to get the convos flowing better. Perhaps by adding a forum of some sort on the site? Or some other doodad where we can all get to learn from each other more and share ideas? I know the point of blogs is usually to get one person’s perspective on stuff, but I feel like adding an extra level on that to continue the conversations would be even sexier. Maybe a more secretive place where we can share that’s even more private? (cue evil laugh) I dunno… What do you think about that? Would you participate if we started some sort of forum here? I’m going to research it more and see what I can come up with… In the meantime, keep on sharing your thoughts in the comments as they really are the heart of this whole operation here. I’m just t

I subscribe to the promotional emails of hundreds of companies so you don't have to. I sift through 1,000 deal-touting emails every week. Most are worthless. But some offer valuable coupons, promo codes, sales and freebies -- which I collect and organize.Note: Expiration dates are in brackets and special instructions are in parentheses.Media"Eating Well" magazine: One-year subscription for $5 at Amazon.com [expiration unknown]. That's six issues. This offer comes with auto-renewal, but you can cancel it if you don't want to automatically be charged for another year."Field & Stream" magazine: One-year subscription for $5 at Amazon.com [expiration unknown]. That's 12 issues. This offer comes with auto-renewal, but you can cancel it if you don't want to automatically be charged for another year.Office and schoolFree personalized desk calendar: At Walgreens Photo online (use code FORTHEDESK) [6/19].Staples: 20 percent off everything you can fit in their bag in stores (print first) [6/22].PetsCat litter: $2 off 8-pound or larger Fresh Step product or 34-pound Scoop Away at Target stores (print first) [expiration unknown].Cat litter: $2 off any size World's Best Cat Litter product (print first) [expiration unknown].TechBatteries: $2.75 off one Energizer Ultimate Lithium, Advanced Lithium or Recharge product (print first) [expiration unknown].Headphones: 71 percent off Pioneer's SE-MJ591 Audiophile Foldable On-Ear Headphones at Buy.com [expiration unknown]. Instead of $300, they're $85 - and shipping is free.Clothing, shoes and accessoriesMessage T-shirts: 40 percent off all T-shirts at BustedTees.com (use code FOURTEEOFF) [expiration unknown].Ann Taylor (women's): 50 percent off all tops in stores and online (use code TOPS50) [6/19].

If you are trying to land a job and have a resume with no experience, don’t lose heart. You can still create a powerful document that will make your interviewer sit up and take notice. Here’s how. 1. Change Your Socks Write your resume with the reader in mind. Get inside her head and slip [...]Related Posts:What are the Sequestration Cuts?How I Won My Credit Bureau Dispute FastRequest A Free ConsultationWhat You Can Expect From Wealth PilgrimFlood and Fire Damage Insurance Companies Don’t Want…

A recent article by Scott Burns talked about investing in deferred fixed annuities with CD-like qualities, an example offered a 3% yield guaranteed for 5 years plus no surrender charges (similar to early withdrawal penalty) after 5 years. This is a better rate than current bank CDs offer, and annuities can grow tax-deferred for those saving for retirement (withdraw as early as age 59.5)*. After the 5 years, you roll the annuity over to another company if the new rate is no longer good enough. The catch? The annuities that have the best rates often don’t have the highest credit ratings. A possible solution? Make sure you stay under the coverage limits of your state’s Life & Health Guaranty Association. From NOHLGA.com: State life and health insurance guaranty associations are state entities (in all 50 states as well as Puerto Rico and the District of Columbia) created to protect policyholders of an insolvent insurance company. All insurance companies (with limited exceptions) licensed to sell life or health insurance in a state must be members of that state’s guaranty association. These are not federally-backed like FDIC insurance. Instead, all the member insurance companies agree to cover each other in cases of insolvency up to the policy limits. In order to be a licensed insurer, you need to maintain a certain level of financial stability. But just like banks, some insurers are stronger than others. So if you’re going to go over the limits, the standard advice is to go with a top credit rating from AM Best, Moody’s, or S&P. However, credit ratings can go down over time, and you may be holding these annuities for many years. Therefore, it’s still safest to stay under the limits. While they vary from state to state, virtually all states offer at least $100,000 in coverage for withdrawal and cash values for annuities. (Connecticut and Washington offer $500,000 in coverage. In California, the limit is 80% not to exceed $250,000.) Look up your specific state’s limits here or here. In order to maximize your coverage, the process is similar to that for FDIC insurance – spread your money across different institutions and use different ownership titles. Let’s say you have $100,000 in state annuity coverage. That value is per owner designation, per company. The Mr. Annuity website has a helpful article [pdf] about how to structure your annuities to maximize your coverage. If a client has $300,000 and wants to make certain all the money is protected, including future interest earnings, while taking advantage of the highest rate possible, we set up 3 contracts in Company A for $80,000 each. In annuity 1, the husband is the Owner and Annuitant. In annuity 2, the wife is the Owner and Annuitant. In annuity 3, the husband and wife are Joint Owners with the husband as the Annuitant. Then, we’ll put $60,000 in the next highest rate we can find in Company B, normally with the husband as Owner and Annuitant. That way, as the money grows, it will be protected under the guaranty laws because they are covered up to $100,000 per owner designation, per company. I made a quick illustration of this theoretical example: Notice that you need to leave some room for growth, that way your future earnings are covered as well. * I’m not saying these annuities are a great deal for everyone. If you are in a situation with a high-income and are already maxing all your other tax-deferred accounts like IRAs, 401ks, and are still looking for safer retirement investments with steady growth then this might be an option to consider due to the ability to get tax-deferred growth with rates competitive with current bond yields. I’m still in research mode. (You may not hear much about these guaranty associations because it is illegal for insurance brokers to use them in advertisements as a reason to buy annuities. I find this somewhat ironic, considering all

At the end of this year’s first trimester, the situation of the national real estate market seemed to present a more positive outlook than most experts, buyers, and sellers would have imagined. The more enthusiastic of them even touted words such as “boom” to describe the increase in housing prices, in the clearance rates at auctions, and, most importantly, in the levels of consumer confidence. While it would be overly optimistic do describe this mild, yet uplifting increase in overall market levels as a boom, it does indicate that 2013 might not spell disaster to the extent to which some may have originally imagined. The housing price stats at the end of February 2013 indicated  monthly increases in four of the eight capital cities, with Darwin leading the pack for its 2.3 per cent rise in prices per dwelling per month. The most significant decrease for the month was posted in Brisbane (-1.1 per cent, down to $420,000 per home, on average). Overall, however, the situation did seem positive: on average, the eight capital cities saw a .3 per cent increase in prices per month, 1.2 per cent compared to the previous quarter and 1.3 per cent on the year. Returns had also increased by 5.7 per cent, the average price was poised at $460,000 and the stats for the rest of the states (i.e. for towns other than the capital city) were also improving: 1.0 per cent on the month, .4 per cent for the quarter, and .4 per cent on the year-on-year indicator. Beyond this optimism, certain key questions persist. For one thing, though the average ratios might seem encouraging, the markets remain highly divided. Price comparisons by property type, price category, and capital cities differ widely – Melbourne alone seems to be genuinely bouncing back and going strong, with the third consecutive price increase on the month. The bottom line is that the property market in Australia is not about to experience a strong comeback on 2013, but it is most likely going to continue on its stabilizing trend. A lot has changed for the better since May of last year, when, according to one survey, property prices hit rock bottom. In the real estate market cycle, that’s also when they started making a comeback. Prices have improved by 3.3 per cent since then and that’s all because buyers are timidly, yet decidedly making their comeback to the market. ‘Timidly’, because they’re being very picky about what and where they buy: areas in Australia where there is a clear surplus in housing stocks are still languishing. The price-location ratio is still the deciding factor and, in earnest, it only makes sense that the buyers should be choosy – the market is clearly a buyer’s market. For this year, the forecast includes more growth on this mid-level segment of the market. The Bankwest Home Loans Density report has shown that though buyers are buying smaller homes for their first home, they are still buying, showing that confidence is also being propelled upward by the lending aspect of the with everyone expecting a comeback in the near future. The question that lies ahead is what’s going to happen when the mid-range segment of the market runs out of well located, fairly priced homes and apartments. The upswing in the property market cycle will also only last for so long, which adds an extra dose of pressure, especially for potential buyers in states that are riding high on the market recovery wave. The construction sector is still lingering – bad news for those who feel that the answer might just come from that direction.

Microsoft's next video game console, the Xbox One, features a built-in camera and microphone that are raising privacy concerns. But technology companies may soon build them into devices with far wider use: cable boxes.Verizon is one of several toying with the idea, The Boston Globe says:Cable and technology companies such as Verizon are trying to develop monitoring systems that would be built into cable TV subscribers’ set-top boxes or digital video recorders and use cameras and microphones to keep tabs on the movements and comments of viewers — even to the point of detecting their moods.Read 4 remaining paragraphs on MoneyTalksNews.com.

Flickr | http://www.flickr.com/photos/18090920@N07/5983965900/ Single mom Natalie Gunshannon from Pennsylvania is suing McDonald’s for paying her wages through the JPMorgan Chase Payroll Card, which charges various fees for use, ultimately resulting in Gunshannon earning less than minimum wage. ABC News reports that Gunshannon is “hoping to have her case certified as a class action on behalf of the other employees who were paid with the Payroll card.” The Chase Payroll Card currently charges a $10 inactivity fee after 90 days, a $1.50 ATM fee, and also a $0.75 per online transaction. According to the lawsuit, McDonald’s “does not provide a choice for hourly employees to receive their justly earned wages through a bank check, cash or direct deposit.” Gunshannon had allegedly asked to get her wages in the form of direct deposit, but was denied, which forced her to use the Chase Payroll Card. In addition, “A growing number of employers use payroll cards to pay some of their employers, but it violates both state and federal law to pay by payroll card alone, according to Lauren Saunders, managing attorney with the National Consumer Law Center.” A payroll card essentially functions like a debit card, but they are only offered by employers who are paying workers for their services. You cannot apply to get a payroll card, and the sole purpose of the card is for employees to deposit a worker’s wages. Employees can withdraw their money through ATMs or a cash-back purchase. However, there are fees associated with the cards, which is why Gunshannon is suing McDonald’s in the first place, because the accumulation of usage fees would bring her $7.44 hourly wage down below the Pennsylvania minimum wage of $7.25. According to an attorney for Consumers Union who was interviewed, “some employers are motivated to pay wages with these payroll cards to cut the cost of distributing paper checks.” Do you think that Gunshannon is fair to sue McDonald’s? Have you ever been paid with a payroll card? Let us know in the comments below. The Top 5 Prepaid Cards: Spring 2013 Related Stories: Comparing Bank Overdraft Fees Justin Bieber’s Prepaid Card Won’t Teach Kids About Money 10 Common Jobs with Low Pay Worker Sues McDonald’s For Being Paid Via Fee-Packed Debit Card

Pharmaceutical companies pay generic drug makers millions of dollars a year to keep their cheaper products off of the market. It's a relatively cheap way to keep prices high and maintain profits, as we've written before. The practice has been called "pay to delay."Now, because of a new U.S. Supreme Court decision, the practice could cost drug makers in ways they hadn't expected. The justices ruled 5-3 that brand-name drug companies can be sued under antitrust laws if they make such agreements, the Los Angeles Times says.The ruling will likely lead to lower prices, the newspaper says; the Federal Trade Commission has said these back-room deals cost consumers and health plans $3.5 billion a year.Read 3 remaining paragraphs on MoneyTalksNews.com.

Q: I recently tried to make an online purchase with my TD Bank debit card but it was rejected, twice. It is not a new card and there is a balance in the account. Why is my card getting declined when shopping on the Internet?- Patrick W. A: There are several possible reasons that your debit card was denied. One reason is that you’ve already hit the daily spending limit on your debit card. Banks place daily spending limits on debit cards to minimize the financial harm that can be done to your finances if your debit card is lost or stolen. On signature transactions (the type that often takes place with online purchases), TD Bank places a $5,000 daily spending limit on a regular Visa debit card or $10,000 on a Visa Platinum debit card. TD Bank customers are allowed to increase their daily spending limits by submitting a request over the phone or by secure messaging through online banking. However, unless you’ve spent that much already during the day, this probably isn’t the reason that your debit card was declined. On the other hand, it is quite common to have any card purchase rejected when the card issuer suspects an unauthorized purchase. It is a simple security measure that kicks in automatically when a purchase is unusually large or takes place at a location that is far from your place of residence. A quick call to the card issuer will lift the security block temporarily. In the most extreme scenario, your checking account was frozen without notice. There are various reasons for why the bank would do that. If your account had noticeable fraud or highly suspicious activity, the bank is likely to take such a drastic action. Again, you’d have to contact your bank if this is the case. 4 Reasons Why Your Credit Card Company Thinks Your Card Is Stolen Related Stories: Simon Says: Your Bank Account Was Labeled ‘Abandoned’ Losing Free Checking? Online Banks Offer Alternatives When the ATM Ate My Debit Card In Hong Kong Simon Says: Debit Card Purchases Can Be Denied For Many Reasons