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Author: Vawn Himmelsbach

  • I’m in my 70s and recently widowed and need to revise my will. But with 3 adult kids, I’m agonizing over how to choose which I name as my executor without risking offending the others

    I’m in my 70s and recently widowed and need to revise my will. But with 3 adult kids, I’m agonizing over how to choose which I name as my executor without risking offending the others

    Imagine this scenario: Christine is in her 70s and needs to revise her will. The last time she looked at the document, her husband was still alive and their three children were toddlers. A lot has changed since then — she’s now widowed and has three adult children.

    Her estate includes a house and car, as well as her savings and investment assets. She also has a number of collectibles.

    While Christine plans to split her assets evenly, she isn’t sure which child to choose as executor without offending the others. She’s thought about making them co-executors, but that comes with challenges, too.

    While she considers all of her children to be smart and capable, she doesn’t want to appear like she’s favoring one child over the other.

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    Choosing an executor

    An executor is a person named in a will who is appointed to carry out the wishes of the person who makes the will (the testator). That task includes managing the estate’s assets, paying off any outstanding debts (including taxes) and distributing assets among the heirs.

    An executor doesn’t have to be a family member. While every state has its own rules, a friend or even a professional acquaintance can be your executor, so long as they’re at least 18 years old, a U.S. citizen and haven’t been convicted of a felony. If an executor isn’t named in the will, the court can appoint someone to carry out the instructions in the will.

    While choosing an executor can be a tough decision, it’s advisable to make a decision based on practicalities rather than emotion. While Christine is thinking about “fairness,” a better approach may be thinking about who is best equipped to handle the responsibilities.

    Here are a few practical questions to help Christine — and others in her situation — decide who’s best suited for the role.

    • Who is most financially literate or has experience with legal or business matters?
    • Who lives nearby and can easily access the property and local courts?
    • Who has the time and willingness to take on the responsibility?
    • Who stays calm under pressure and handles stressful situations well?
    • Who is organized and good at following up on paperwork and deadlines?
    • Does this person have a good relationship with the other heirs?

    The executor will also need to contact various agencies including the Social Security Administration (to stop any benefits) and the IRS (to file the deceased’s final income tax return). And they have to oversee the management of any cash, stocks, bonds and real estate.

    It’s also possible to hire an executor if your children aren’t keen (or able) to take on the role, though that comes at a cost.

    What about co-executors?

    It’s possible to have more than one executor, and in some cases it could make sense.

    Anthony J. Enea, a managing partner at law firm Enea, Scanlan & Sirignano LLP, recommends that, if you have more than one child and you’re selecting an executor, trustee or agent of power of attorney, “it is wise to select two children (if possible) so as to create an inherent system of checks and balances and avoid the possibility of one person being vested with too much power and authority.”

    It also means one child doesn’t have to shoulder all of the responsibility that comes with the role.

    “If offending and/or hurting a child’s feelings is an important issue, then perhaps selecting co-executors, co-trustees and co-agents under a POA will be the solution,” says Enea.

    Co-executors may be a good idea if:

    • They have a strong, cooperative relationship
    • They live close to one another
    • They have complementary skills (e.g., one is local, one is financially savvy)
    • They’re both willing to share the responsibility and workload
    • Co-executors don’t make sense in every situation. If there are conflicts between siblings about the estate or one co-executor feels he or she is doing most of the work, that could cause delays in the sale of assets or distribution of funds. Major conflicts could even lead to legal disputes.

    If you’re thinking about co-executors, you’ll want to consider how well they get along, if they live close together and if they’re equally competent and communicative.

    Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it

    How to have the conversation

    While estate planning can be an uncomfortable conversation for many families, open communication is one of the best ways to prevent conflict down the road. Don’t spring it on your kids; make sure they know what this meeting is about so they can mentally prepare.

    Here’s what Christine should consider discussing:

    • Where to find the will and other important documents
    • Contact info for her lawyer, financial advisor, and insurance agent
    • General details about how the estate will be divided
    • Who gets specific items (like collectibles, the car, or family heirlooms)
    • Who she’s thinking of naming as executor — or ask who would be willing to take on the role

    She doesn’t have to disclose exact dollar amounts, but a rough idea of what her children might inherit could help with their own financial planning.

    This is also a good time to discuss who she’s chosen as executor or have a conversation about which child (or children) would be willing and able to take on the role. Not all children want to be executor, so you’ll want to have their consent first. The role comes with a lot of responsibility and can eat up a lot of time; it can also be emotionally draining.

    Open communication early on can help prevent resentment down the road, while ensuring that your wishes will be met.

    What to read next

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    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • I spent way too much in my first 4 years of retirement — now I worry I’ll never get back on track. What do I do?

    I spent way too much in my first 4 years of retirement — now I worry I’ll never get back on track. What do I do?

    Retirees usually have bucket lists and dream vacations they want to go on while they’re still healthy and fit.

    But after trips and maybe a few too many dinners out over the past four years, it sounds like you’re suffering buyer’s remorse. The good news is you realized you’re jeopardizing your ability to fund the rest of your retirement, and you can take steps to protect your financial well-being before it’s too late.

    Many retirees are spending more than they planned

    About a third of retirees (32%) say their monthly expenses in retirement are higher than they expected, according to the 2024 Profiles of Retirement conducted by the Ontario Securities Commission (OCS), with sustained high inflation topping Canadians’ list of concerns.

    Despite this, 70% of retirees are say their standard of living is similar to or better than what it was pre-retirement.

    Does this mean that most retirees are planning to indulge in more leisure activities now that they have the freedom? Well, it’s actually the opposite.

    When comparing the spending objectives of retirees and pre-retirees, only 35% of Canadians in retirement are prioritizing recreational travel during their golden years. In comparison, 55% of their non-retired counterparts intend to become frequent flyers.

    This isn’t necessarily a bad thing. Because our health will inevitably decline as we age, we may have more energy, mobility and strength to pursue leisure activities and travel in our early years of retirement.

    Doing so, however, will require careful planning to ensure you remain comfortable throughout retirement and are able to fund a potential increase in medical expenses in later years.

    Getting back on track

    To ensure you have income throughout your retirement, determine a sustainable rate at which you can withdraw from your retirement savings.

    A common rule of thumb is the 4% rule. It says if you withdraw 4% of your investment portfolio in the first year and then this same amount plus an adjustment for inflation in each subsequent year you have a low probability of running out of money for 30 years.

    In the case of spending too much in the early years of retirement, you could determine today how much of your savings remain and begin employing the 4% rule from this point forward. This will likely mean you have to cut back on spending, but it could help ensure you remain comfortable going forward.

    This rule can be a useful starting point, but that doesn’t mean it’s a one-size-fits-all solution since each person’s situation is different. Instead, you may find that a different withdrawal strategy works better for you.

    For instance, you might want to use the percentage of portfolio strategy, where you withdraw a fixed percentage of your portfolio’s value each year. This means your income will fluctuate each year with the market value of your portfolio.

    If you follow a fixed-dollar withdrawal strategy, you’d withdraw a fixed dollar amount every year for a set time and then re-evaluate.

    Optimizing your financial strategy

    You want to make sure your portfolio asset allocation reflects your investing horizon and risk tolerance. You may want to consider speaking with a financial advisor about your situation. Many advisors today have modeling tools at their disposal that allow them to run personalized economic and life scenarios to help determine the best withdrawal strategy.

    An advisor can also help with other retirement income withdrawal considerations, such as the amount of income you’ll be receiving from the Canada Pension Plan, your required minimum distributions from your RRSP and/or TFSA and how and when to take from each type of account and asset class to be as tax-efficient as possible.

    As you get serious about spending responsibly, you may want to reevaluate your lifestyle and earn some additional income. Creating a budget and tracking expenses can be valuable tools in determining where expenses could be cut back.

    To earn additional income, you could take on a side hustle or part-time job. If major changes are needed, you may want to consider renting out a room, sharing a place with a friend or even moving to a less expensive area. Other options you might consider are accessing your home equity and borrowing against the cash value of a life insurance policy or even selling it.

    There’s nothing wrong with taking advantage of your good health early in retirement to live a little. But if you get off track financially, acknowledging the issue and tackling it right away can help to ensure a comfortable retirement in your later years, too.

    Sources

    1. Ontario Securities Commission: Profiles of Retirement (Jan 10, 2024)

    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • I’m 68, survived a car crash and have relied on Medicaid for years. Now I’m inheriting $250K from a friend — but fear losing benefits. How can I protect the money, make sure my kids get it?

    Imagine this scenario: Two decades ago, Kristin was driving home from a friend’s house when she was struck by a drunk driver, who hit her car head-on. After surviving a coma and suffering a brain injury that made it impossible to work, she’s been on Medicaid ever since.

    While she has enough money to get by — she has no debt and owns her house — she doesn’t have much left over at the end of the month. That’s why, when she found out she had inherited $250,000 from her best friend, she was incredibly grateful. But also a little worried.

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    A large lump sum of cash would bump Kristin over the income eligibility limit for Medicaid, so she could lose her benefits.

    She’s now worried about Medicaid’s five-year Look-Back Rule, a period during which Medicaid can evaluate a recipient’s financial history to ensure they’re not artificially reducing their net worth. If so, a penalty period would apply.

    Not only is Kristin worried about losing her Medicaid coverage, she’s also worried she might end up in violation of the Look-Back Rule and that a Medicaid lien would be placed on her property when she dies, so she wouldn’t be able to pass on her remaining assets to her children.

    Are her concerns valid or are there ways to make the windfall work more in her favor?

    Could an inheritance jeopardize Medicaid?

    The Affordable Care Act determines income eligibility for Medicaid based on Modified Adjusted Gross Income (MAGI). To receive Medicaid, you can’t exceed monthly income and asset limits, which differ by state. In most cases, a single senior applicant can’t exceed $2,901 a month in income, according to the American Council on Aging (ACOA).

    “In 2025, most states have an asset limit of $2,000 for an individual senior applicant and $3,000 for an elderly couple,” the ACOA writes. Some assets are exempt, such as the applicant’s house, vehicle and personal belongings. Each state sets its own rules around how IRAs, 401(k)s and pensions are accounted for, too.

    An inheritance would count as income in the month it’s received; in Kristin’s case, it would push her way over the income limit for Medicaid benefits.

    The first thing Kristin should do is report the inheritance to her state Medicaid agency.

    “Medicaid will view the inheritance either as income and/or assets, depending on when the inheritance was received and how long it has been since receipt,” the ACOA writes.

    But she should do it as soon as possible.

    “While a Medicaid beneficiary generally has 10 calendar days to report the receipt of an inheritance, this timeframe could be shorter or longer, depending on the state,” the ACOA says.

    If you don’t, and the inheritance disqualifies you from Medicaid, then you’d be responsible for reimbursing Medicaid for any benefits you received during that time.

    Each state has different rules, which can add to the confusion. A Medi-Cal recipient in California, for example, is allowed to gift an inheritance to a third party, so long as it’s done in the same month it’s received. The state also has no Look-Back Rule in place for assets transferred after Jan. 1, 2024.

    Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it

    Strategies that could help

    It’s possible to “spend down” your inheritance, too — so long as it doesn’t violate the Look-Back Rule.

    “If the money is spent in its entirety during the month of receipt and without violating Medicaid’s Look-Back Rule, one will be eligible for Medicaid again the following month,” according to the ACOA.

    That might mean paying off debt, paying for long-term care, making home modifications or renovations for accessibility purposes or buying assets that are exempt from the asset limit, such as clothing or home appliances. You could even pre-pay funeral expenses through an Irrevocable Funeral Trust.

    There are also strategies that may allow someone to benefit from an inheritance without losing Medicaid. These include:

    Pooled Special Needs Trusts (SNTs): To get around the Look-Back Rule, Kristin could transfer the inheritance into a Pooled Special Needs Trust (SNT), which is typically run by a charitable or philanthropic organization (there are several hundred to choose from in the U.S.). These transfers are exempt from the Look-Back Rule since they no longer count toward the recipient’s income or assets, according to the Brain Injury Association of America, but ensures they still have resources for long-term care.

    Medicaid-Compliant Annuities (MCAs): Buying an MCA means you give an insurance company a lump sum of cash, which is then converted into a steady income stream. When properly structured, it allows you to lower your countable assets so you don’t lose Medicaid benefits — but not all states treat annuities the same way.

    Medicaid Asset Protection Trusts (MAPTs): Sometimes called a Medicaid Planning Trust or Medicaid Trust, a MAPT protects a Medicaid recipient by putting their excess assets into a trust. The recipient names a trustee and beneficiary who will inherit those assets. Since the recipient who created the trust no longer owns those assets, it won’t count toward Medicaid’s asset limit.

    A MAPT can also be used to protect assets for a recipient’s children or other family members. For example, it can help to protect assets from Medicaid’s Estate Recovery, where the agency tries to reimburse the cost of the recipient’s care from their estate after they pass away.

    Before Kristin makes a decision, she may want to consult with an attorney. It’s worth looking for an attorney who is a member of the National Elder Law Foundation or the National Academy of Elder Law Attorneys and is familiar with the challenges that older adults can face.

    What to read next

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    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • ‘I’m speechless’: San Francisco families feel betrayed after learning $3.8M in donations meant for local playgrounds were allegedly used on expenses like ‘swanky galas’ and staff bonuses

    ‘I’m speechless’: San Francisco families feel betrayed after learning $3.8M in donations meant for local playgrounds were allegedly used on expenses like ‘swanky galas’ and staff bonuses

    The San Francisco Parks Alliance (SFPA) — a nonprofit foundation established to “create, sustain and advocate for parks” — has abruptly shuttered amid a media and legal firestorm over alleged mismanagement involving at least $3.8 million in donations.

    That leaves donors like Nicola Miner — whose Baker Street Foundation donated $3 million to the SFPA several years ago — “speechless.” She gave the SFPA that money to support construction of two neighborhood playgrounds.

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    “I wanted a park here, that was what our money was for,” Miner told CBS News.

    But the parks never materialized. Instead, she learned that the SFPA — an arm’s-length fundraising partner of San Francisco’s Recreation and Parks Department — funneled nearly $2 million of her foundation’s donation to cover general operating expenses.

    “The money was not for general operating expenses. And so I just feel a real sense of betrayal,” Minser said. “The fact that they took money away from families, I’m speechless.”

    A prominent nonprofit falls from grace

    The San Francisco Standard reports that top employees at the SFPA got bonuses despite a “massive deficit”, and the nonprofit spent more on “swanky galas” and fundraising events than it made.

    “You would never, in a million years, give a bonus under these circumstances,” Joan Harrington, a nonprofit ethics expert at Santa Clara University, said.

    Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it

    In the wake of the allegations, San Francisco’s mayor froze the organization’s funding in May, and City Attorney David Chiu launched an integrity review into the nonprofit.

    Subsequently, The San Francisco Standard reported that the SFPA was abruptly “winding down,” leaving donors and partners empty-handed.

    Just days afterward, the San Francisco Government Audit and Oversight Committee subpoenaed the organization’s former CEOs and its board treasurer after they failed to show up at a committee hearing.

    Doing your donation due diligence

    Some donors may be left wondering how they could be let down by such a prominent and politically connected organization. It’s a reminder that a prominent name is no guarantee of continued success or appropriate management — and the prudent approach to committing funds is to perform thorough due diligence.

    To help with this process, the Stanford Center on Philanthropy and Civil Society (Stanford PACS) has published “The Stanford PACS Guide to Effective Philanthropy,” with questions that donors should try to answer before making a commitment. For example:

    • Does the nonprofit comply with tax regulations?
    • Are its donations earmarked for a specific purpose (like a playground)?
    • Are the donations restricted or unrestricted?
    • How does the organization track and report restricted donations?

    Restricted donations have conditions on how those funds are to be used, while unrestricted donations can be used for anything related to the nonprofit’s mission.

    Stanford PACS also publishes the Philanthropist Resource Directory, which can be a helpful resource early in the due diligence journey.

    Several third-party websites are also available to help with this process.

    For example, GuideStar aggregates information about U.S. nonprofits registered as 501(c)(3) organizations and categorizes them based on the amount of information they self-report.

    It also publishes IRS Form 990 tax returns, which are filed by “tax-exempt organizations, nonexempt charitable trusts and section 527 political organizations.”

    GiveWell researches and recommends charities working in global health and poverty alleviation “that save or improve lives the most per dollar,” while Charity Navigator rates more than 225,000 nonprofits based on their “cost-effectiveness and overall health of a charity’s programs, including measures of stability, efficiency and sustainability.”

    The Stanford PACS guide also suggests looking at which organizations have received grants from respected foundations such as the [Gates Foundation]https://www.gatesfoundation.org ) or Ford Foundation — both of which have searchable grants databases — and talking to people who’ve contributed to the organization or worked with it.

    Donors can also consider a Donor Advised Fund (DAF), an account that allows donors to give to charity, receive an immediate tax deduction and recommend grants from the fund over time.

    Donating a large amount of money to a charity is a big commitment — and even supposedly reputable organizations can run into trouble. So time spent on due diligence is time well spent.

    What to read next

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    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • ‘A lesson in worst practices’: Shocking audit reveals Chicago parking meters have made $2B for a private company — with 58 years still left in the deal. What everyone can learn from this

    ‘A lesson in worst practices’: Shocking audit reveals Chicago parking meters have made $2B for a private company — with 58 years still left in the deal. What everyone can learn from this

    Have you ever been strapped for cash? Perhaps you took a payday loan, sold a long-term asset or even made an early withdrawal from your 401(k). And chances are, you’ve later regretted it.

    This is the situation the City of Chicago finds itself in — and the cost may have been billions.

    Privatizing public infrastructure is a growing trend among cash-strapped cities that need fast revenue. Back during the 2008 financial crisis, Chicago was broke and needed to raise money. Rather than make the unpopular move of raising property taxes, then-mayor Richard M. Daley chose to privatize public assets.

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    “If we didn’t have money for a long-term debt, you’re talking about a serious economic crisis then for Chicago,” Daley said at the time, according to NBC 5 Chicago.

    So, Chicago City Council struck a deal to lease the city’s 36,000 parking meters to investment consortium Chicago Parking Meters LLC, a group of global investors led by Morgan Stanley.

    The investors paid nearly $1.157 billion to receive the revenue from the meters for 75 years — and the city must reimburse them whenever the parking meters are taken offline, such as for festivals or construction.

    A lesson in ‘worst practices’

    The deal was essentially rubber-stamped 40-5 in favor by the council, which had only a few days to review it before voting — turning out to be what the Better Government Association later called “a lesson in ‘worst practices.’”

    Soon after, a report issued by the then-inspector general found the city was paid at least $974 million less than it could have made from operating the parking meters itself over the term of the deal. While an analysis done by 32nd Ward Alderperson Scott Waguespack — who voted against the deal — found the deal could have been worth $5 to $10 billion, reported NBC 5.

    Now, a 2024 audit by accounting firm KPMG has found that, with another 58 years still left in the agreement, the private investors have already recouped their initial investment. In 2023, the meters generated a record $160.9 billion in income, bringing the total income from the start of the deal to $1.97 billion.

    “It’s just one of those deals that I would beg people never to replicate anywhere in the United States,” Waguespack told NBC 5.

    Still, many Americans can relate to the situation that faced Mayor Daley. When we’re desperate for funds, we can make rash decisions that negatively affect our long-term financial health.

    Almost 4 in 10 (37%) U.S. adults would not be able to cover a $400 emergency expense with cash savings, according to the Economic Well-Being of US Households in 2024 report from the Federal Reserve Board of Governors. And while many of these people say they could cover the expense some other way, such as using a credit card, borrowing from family or friends or selling something, 13% would not be able to pay the expense by any means.

    About 58% of Americans are “living paycheck to paycheck and experienced a cash emergency in the past 12 months,” according to The 2025 Cash Poor Report from peer-to-peer lending platform SoLo Funds.

    Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it

    Be careful how you raise funds

    These “cash-poor” Americans may not be who you think they are. Forty percent have a full-time job and one in seven cash-poor households earn more than $75,000 per year. The top unexpected expenses, according to the report, are auto repairs, medical bills and utility bills — common expenses that can happen to any of us.

    To cover these expenses, some may turn to short-term financing options that could end up costing them more money in the long term. For instance, buy now pay later (BNPL) services come with an average borrowing cost of 23%, according to The 2025 Cash Poor Report, which can increase substantially if the borrower incurs repeat late fees.

    Another option is a payday loan, which is one of the most expensive ways to borrow. The industry average cost of borrowing for payday loans is 35%, according to the report, but origination fees, late fees and processing fees can push this as high as 49% of the principal borrowed. Increased borrowing and missed payments can also affect your credit score, which in turn can limit your future ability to borrow.

    People might also look to sell long-term assets such as stocks, bonds or mutual funds, but this too can have long-term financial costs. If you’re 30 years from retirement and sell $10,000 of an asset today that’s earning 7% per year, then you’ll have about $76,000 less when you retire due to the loss in compounding interest.

    Plus, research has shown that time out of the stock market can be costly — and missing the best days in the market can be devastating to your long-term returns. And, if you make an early withdrawal from a tax-deferred account such as a 401(k), you’ll also pay a 10% tax penalty.

    To avoid high-cost borrowing in an emergency or cashing out long-term investments during a downturn, start by building an emergency fund that could cover unexpected expenses. A rule of thumb is to have three to six months’ income in an accessible account, such as a high-yield savings account.

    While desperate times may call for desperate measures, it’s worth consulting with a financial advisor (or a free counseling service) to discuss your options before getting saddled with debt or selling long-term assets.

    What to read next

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    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • I’m 28, recently married, with zero debt — I’ve always wanted to own a house but the market seems so lousy right now. Is it smarter to invest in the S&P 500 and save up while renting for now?

    I’m 28, recently married, with zero debt — I’ve always wanted to own a house but the market seems so lousy right now. Is it smarter to invest in the S&P 500 and save up while renting for now?

    Jamie, 28, recently married her long-time boyfriend, Ben. They’ve always been careful with their money as a couple, sticking to a monthly budget and saving 15% of their salaries. They even opted for a small, simple wedding rather than racking up debt.

    Jamie and Ben rented a small one-bedroom apartment when they moved in together five years ago. It made sense at the time. They were just starting out in their careers and liked to have some extra money for dining out and entertainment.

    Now they’re thinking of starting a family and are not so keen on renting.

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    Jamie has always wanted to own her own home and she doesn’t want to raise kids in a rental apartment.

    But since current home prices and mortgage rates make it a “lousy” market for people looking for starter homes, Jamie’s wondering if it makes more sense to invest in the S&P 500 and save as much as possible while continuing to rent.

    To rent or to buy?

    U.S. home prices were up 1.3% in April compared to the same time last year, according to Redfin, selling for a median price of $438,108.

    Mortgage rates remain relatively high, still below the 7% threshold, but averaging 6.83% in May, according to Freddie Mac.

    Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it

    These factors may help explain why demand — often understood through existing home sales — “remains exceptionally low,” according to J.P. Morgan’s home price outlook for 2025,

    “The U.S. housing market is likely to remain largely frozen through 2025,” J.P. Morgan Research reports. “Some growth is still expected, but at a very subdued pace of 3% or less.”

    That leaves many potential homebuyers wondering when — or if — there’s going to be a good time to buy a new home.

    Over the next two years, home prices may drop as housing supply grows, and mortgage rates could fall with Treasury yields, according to Morgan Stanley strategists.

    But as the investment bank notes, that doesn’t necessarily mean “a return to the pre-pandemic era of more affordable mortgages and home prices.”

    Meanwhile, 2025 has so far been a renter’s market, with rents falling as the supply of rental units grows. That’s thanks in part to the appearance of new units on the market as projects that started in the early days of the pandemic are completed.

    However Realtor.com notes that this effect could be short-lived, as lower rent disincentivizes developers from building rental buildings. That could lead to a rental housing pinch.

    And lower rent doesn’t mean “low”. Rents are still 14.4% higher than they were five years ago, according to Realtor.com.

    Weighing the pros and cons

    Both stocks and home equity can provide a path to wealth. Historically the stock market has provided a 10% average annual return, while the housing market has seen smaller gains.

    The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, which tracks residential real estate prices, shows a 3.4% annual return for March 2025.

    There’s also a third option that combines both: real estate investment trusts (REITs), which allow you to invest in real estate like stocks.

    But returns are not the only consideration. Stocks provide greater liquidity than real estate, yet the market can be volatile.

    Here are some of the pros and cons of both home ownership and investing in the stock market that Jamie and Ben should consider.

    Buying a home now

    PROS. If Jamie and Ben buy a home now, they can start building equity immediately. If they wait to buy, housing prices and/or mortgage prices could come down, but there’s no guarantee.

    Real estate comes with a number of benefits, such as property appreciation, tax advantages and the potential to bring in rental income.

    Some people like the stability of owning their own home. If you rent and your landlord decides to sell, then you have to vacate your home and find another rental property.

    CONS. Buying a home comes with both high initial costs (such as a down payment and closing fees) and ongoing expenses — from property taxes to utilities and unexpected repairs. These may add up to more than the cost of Jamie and Ben’s current rent.

    Renting and investing in the S&P 500

    PROS. If Jamie and Ben continue to rent and instead invest extra money in the S&P 500, they could see higher returns over time than with real estate.

    They could put money they earn toward a large down payment for a home in the future. But the couple will need to be disciplined enough to actually invest that extra money and avoid lifestyle creep (where your spending increases as your income increases).

    Renting gives them freedom and flexibility. If they want to move to another city or country, they won’t have to deal with the hassle of selling a property, and they’re not tied to a mortgage and property taxes.

    CONS. The current state of stock market volatility could mean they have to delay homeownership even longer.

    BOTTOM LINE. It’s a highly personal decision and there’s no ‘right’ answer. For Jamie and Ben, wanting to raise kids in a home they own may outweigh the desire to wait out the housing market.

    They may want to discuss the matter with their financial advisor, as well as a mortgage broker and/or real estate agent.

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  • I’m 56 and my wife died suddenly a few weeks ago. I’m finally ready to think about the future, but she made 65% of our income and I won’t be able to afford our bills on my own — what do I do?

    Consider this scenario: Paul’s wife unexpectedly passed away a few weeks ago.

    Aside from the shock of losing the love of his life, he has a new source of stress he wasn’t prepared for: His wife made 65% of their household income. And he can’t afford the mortgage on his own.

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    Now, Paul is wondering what to do. Should he refinance his home? Should he dip into his retirement savings to pay the bills?

    While he does have some money in a high-yield savings account (about $30,000), he’ll also get a life insurance policy payout worth about $200,000. He’s been putting money into a 401(k) at work too, but he doesn’t think he should dip into that money before he retires.

    So, what can he do instead?

    Dealing with the death of a spouse

    Dealing with the death of a spouse is hard on many levels. Suddenly, you’re left without your life partner, but you also have to deal with the financial implications of being suddenly single.

    Paul isn’t alone. Individual annual income falls by an average of $5,500 after the death of a spouse for at least two years, according to National Bureau of Economic Research data cited by the Federal Reserve Bank of Chicago. The rate of financial insolvency also increases after the death of a spouse.

    Women tend to be hit harder than men, since women on average make less money than men. As of 2024, women earned 85% of what men earned in the U.S., according to a Pew Research Center analysis. They may also leave the workforce temporarily or permanently to raise children.

    Women also tend to live longer than men — roughly six years, which can have significant financial implications.

    A Thrivent survey found that more than half of widowed women experienced financial challenges, with 51% living paycheck to paycheck or struggling to manage their bills.

    One major reason? Debt.

    “Debt is one of the top financial challenges facing widowed women. Thirty-nine percent carried over $25,000 in debt immediately following the loss of their spouse, including 10% having over $100,000,” according to the survey.

    But the same can be said of any spouse that’s making less money than their partner, as in the case of Paul.

    Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it

    What are the first steps after a spouse suddenly dies?

    While it’s generally advisable to avoid making major life decisions immediately after losing your spouse, sometimes you don’t have a choice when it comes to finances.

    When a spouse suddenly dies, the surviving spouse may want to start by doing a “financial triage,” which means assessing your financial situation, prioritizing what’s most important (such as paying the bills and paying high-interest debt) and doing an inventory of your debts.

    You’ll want to locate important documents, such as the will, property deed and life insurance policy. You’ll have to contact the insurance company directly to inform them of the death and start the claims process.

    In most states, a life insurance payout is issued between 30 to 60 days, though it may be faster, according to Ramsey Solutions. These payouts are tax-free and you can take them as a lump sum.

    It’s also important to consider commonly overlooked benefits, such as spousal beneficiary rollovers and survivor benefits.

    With a spousal beneficiary rollover, the deceased’s fund assets are transferred to the surviving spouse, usually in one of two ways: Either the surviving spouse becomes the new owner of the retirement account or the funds are rolled over into the surviving spouse’s retirement account.

    There’s also an option to liquidate the account and receive a lump-sum payment at any time, says the IRS.

    When rolling over an individual retirement account (IRA), in most cases the surviving spouse won’t have to pay taxes. A lump-sum payment, however, is likely to be considered taxable income. Keep in mind that a Roth IRA (in which you contribute post-tax money) may have different withdrawal rules than a traditional IRA (in which you contribute pre-tax money).

    In some cases, it may be possible to claim survivor benefits, which are monthly payments to family members of a deceased family member who contributed to Social Security during their working years (the amount is determined by the deceased’s average lifetime earnings). Not only are spouses eligible, but so are divorced spouses, children and dependent parents.

    According to the Social Security Administration, to be eligible as a spouse, you need to:

    • Be at least 60 or older
    • Have been married at least nine months before your spouse’s death, and
    • Hold off remarrying before age 60.

    But, age may not matter if you’re still caring for a child of the spouse who passed away.

    A widow could be eligible for Medicare based on their deceased spouse’s work history. A widow could also potentially qualify for Medicaid, depending on their income and assets.

    For guidance, contact your state’s Medicaid office or State Health Insurance Assistance Program, which can provide counseling and assistance with Medicare and Medicaid.

    Rebuilding your finances — and your life

    Eventually, you’ll start creating a new life that accounts for only one household income. Once you understand how much money you have coming in (including a life insurance payout and any other forms of income you’ve been bequeathed), you’ll be able to reassess your lifestyle based on your new household income.

    For example, before his wife had passed away, Paul bought a second vehicle. Now that he no longer needs two vehicles, he could sell one and use the money to help him pay down debt or help with the mortgage.

    He may also want to consider downsizing to a smaller home. In the meantime, if he can’t afford his mortgage payments (or wants to wait until rates go down), he could consider working overtime or taking on gig work to bring in some extra money. He could even get a roommate to help him cover the mortgage and household bills.

    For those feeling overwhelmed by all of this, there are community resources and state programs available that can help with both emotional well-being as well as financial guidance, such as the Wings for Widows and Soaring Spirits International.

    It may be worth working with a trusted financial advisor or even a grief counselor to develop a roadmap for the year ahead — from rebalancing your budget to restructuring your lifestyle.

    Be prepared

    Each spouse should know where important documentation is stored, as well as passwords for any electronic documentation. It’s also important to have a will that names a beneficiary or beneficiaries; otherwise, the state decides who gets your estate — and that can be a long, complex and emotionally draining process for your loved ones.

    Since it can take up to two months to get a life insurance payout, it’s also a good idea to build an emergency fund that will cover expenses during that timeframe. Dipping into your own retirement savings to get by during this time could hurt you in the long run.

    While it can be uncomfortable, it’s important for couples to discuss their end-of-life wishes and make financial plans ahead of time.

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    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • Here are 3 Social Security myths that can ruin your retirement — are you falling victim to any of them?

    Here are 3 Social Security myths that can ruin your retirement — are you falling victim to any of them?

    Your friend’s cousin on Facebook may be a smart guy, but since he’s not a tax expert, you might want to avoid taking advice from him on the latest Social Security benefit rules.

    If you have questions about Social Security, your best bet for information is the Social Security Administration (SSA) website or your financial advisor.

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    Still, there are hundreds of friend’s cousins out there propagating myths about Social Security on social media. Here are three persistent myths that could wind up hurting your retirement.

    Myth 1: You don’t pay taxes on Social Security benefits

    Most Americans don’t have a retirement tax plan, according to a Northwestern Mutual study. If you’re one of them, it could be worth speaking to a financial advisor, since minimizing the taxes you pay in retirement can have a material impact on how much money you’ll have to spend.

    One thing you’ll need to account for is that Social Security benefits may be taxed — contrary to a common myth that they’re not. The Internal Revenue Service (IRS) has a tool to help you determine, based on your gross income and the type of benefits you’re receiving, whether your benefits are taxable. The IRS also publishes a guide to help you calculate the taxes you might owe.

    In general, how much you’ll be taxed on your benefits will depend on your income and filing status. To determine whether your benefits are taxable, add half the amount of benefits you’ve collected during the year to your other income, which may include pensions, wages, dividends, interest and capital gains. If you’re married and filing jointly, then take half of each spouse’s Social Security benefit and add that to your combined income.

    According to the IRS, half of your benefits may be taxable if:

    • You’re single, the head of a household or a qualifying widow or widower (with an income of $25,000 to $34,000).
    • You’re married but you and your spouse lived apart for the tax year and are filing separately (with an income of $25,000 to $34,000).
    • You’re married and filing jointly (with a combined income of $32,000 to $44,000).

    Up to 85% of your benefits may be taxable if the calculated income exceeds the upper range in any of the above cases, or if you’re married and filing separately but you lived with your spouse at any point during the tax year.

    Also, for the 2025 tax year, there are nine states that could tax your Social Security benefits. If you live in Colorado, Connecticut, Minnesota, Montana, New Mexico, Rhode Island, Utah, Vermont or West Virginia, you may want to familiarize yourself with the rules around taxation of your benefits.

    Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it

    Myth 2: You must be retired to draw Social Security

    Another myth is that you have to be retired to collect your retirement benefit. However, you may be able to collect Social Security even if you’re still working.

    If you haven’t reached your full retirement age (FRA) — which ranges from 66 to 67, depending on the year of your birth — some of your benefits may be withheld. They’re also more likely to be taxed because you increase the chances that your income is above the threshold for Social Security taxation.

    The SSA sets an annual earnings limit for people who haven’t reached their FRA but are collecting benefits. For 2025, this limit is $23,400, which includes wages, bonuses, commissions and vacation pay. If you exceed that limit, the SSA will deduct $1 for every $2 you make above $23,400.

    In the year you reach your FRA, the 2025 earnings limit is $62,160 for the months before you hit your FRA. In this case, the SSA will deduct $1 for every $3 you make above $62,160. However, once you reach your FRA, there’s no limit on how much you can make, which means there’s no deduction for earnings.

    To help you plan, the SSA provides a Retirement Age Calculator, a Retirement Earnings Test Calculator and an explanation, with numeric examples, of how work affects your benefits.

    Myth 3: The annual COLA is guaranteed

    Some Americans believe their benefits are guaranteed a cost-of-living adjustment (COLA) every year, but if you’re budgeting based on this assumption, you may need to rethink your planning.

    A COLA adjusts your benefit for inflation so that your benefit checks can retain purchasing power. Most years, retirees can expect to receive one (in 2025, the COLA is 2.5%). But, since the COLA calculation is based on inflation — and because of the way it’s calculated — it’s possible for the COLA to be zero, so you’re not guaranteed to see a bump in your benefit every year.

    In October of each year, the SSA announces the COLA that will be applied to the following year’s benefit payments. The COLA is based on the average Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), calculated monthly by the Bureau of Labor Statistics.

    According to the SSA, the COLA is “equal to the percentage increase (if any) in the CPI-W from the average for the third quarter of the current year to the average for the third quarter of the last year.” It’s then rounded to the nearest tenth of 1%.

    However, if — after rounding — there’s no increase in the average CPI-W, then there’s no COLA for the year. This occurred in 2009, 2010 and 2015.

    Not only is it possible for there to be no COLA in some years, it’s also possible that the increase in your benefit amount may not be equal to the COLA multiplied by your benefit. This occurs because the COLA is applied to your primary insurance amount (PIA), which is the benefit you would receive if you elected to start receiving benefits at your FRA without adjustment for early or delayed retirement.

    These myths can affect your retirement planning and cost you money. When planning for retirement, you may want to engage a qualified financial advisor and use reputable sources for information — no matter how well-meaning your friend’s cousin may be.

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    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • There’s a new ‘magic number’ Americans say they’ll need to retire comfortably — and it’s a shocking change since 2024. Here’s how to reach it ASAP without turning to sorcery

    There’s a new ‘magic number’ Americans say they’ll need to retire comfortably — and it’s a shocking change since 2024. Here’s how to reach it ASAP without turning to sorcery

    Humans often seek easy answers and shortcuts. This is not always a flaw, but a form of efficiency. So, it’s no surprise that we want a ‘magic’ answer to one of the biggest financial decisions we need to make: how much to save for retirement.

    As a result, we often have a ‘magic number’ in mind for our retirement savings.

    This year, that ‘magic number’ Americans believe they’ll need to retire comfortably is $1.26 million, according to Northwest Mutual’s 2025 Planning & Progress Study.

    This is $200,000 less than the estimated $1.46 million they believed they’d need when they were surveyed last year. This number is also more in line with the 2022 and 2023 estimates, indicating a reversal in thinking from last year to the years before.

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    Why the ‘magic number’ might be lower this year

    It’s likely that the decline in the ‘magic number’ from last year is at least partially related to declines in inflation, which has been falling — albeit unevenly — since peaking in the summer of 2022.

    As inflation has fallen, so too have expectations of future inflation, which were lower in 2024 than in the previous couple of years. This suggests that for that year, future retirees may not believe high inflation would eat away at their retirement savings, compared to years prior.

    It may also be that views on retirement are changing. Whether by necessity or intention, about half of workers plan not to retire before the ‘traditional’ age of 65 and 39% expect to retire only at 70 or older, or not to retire at all, according to a report by the Transamerica Center for Retirement Studies. This could mean a shorter retirement and additional income during this period, reducing the size of an individual’s needed nest egg.

    Is the ‘magic number’ a reasonable goal?

    Before you start worrying about achieving that ‘magic number,’ it’s worthwhile to determine if it’s a reasonable goal. In 2023, the average expenditure for a household where the ‘head’ of the household is 65 years or older was $60,087, according to the U.S. Bureau of Labor Statistics.

    Assuming most retirees will collect Social Security benefits — averaging about $2,000 in April 2025 ($24,000 a year), and further assuming only one member of the household will collect benefits, a household would need an additional sum of about $36,000 a year to cover expenses.

    A common rule of thumb is to withdraw 4% of your nest egg in the first year of retirement and then to continue withdrawing that amount (adjusted for inflation) each year afterward. This would allow your nest egg to provide income for the duration of most retirements. If you need $36,000 per year, then you’d need an initial nest egg of about $900,000 — making $1.26 million more than many need.

    But research by the Employee Benefits Research Institute shows that retirees are cutting back on expenditures because of insufficient income, so using actual expenditures may give a more accurate picture of the amount retirees will need to live comfortably.

    Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it

    Another retirement rule of thumb is to estimate that you’ll need 70% to 80% of your pre-retirement income to retire comfortably. Real median household income in the U.S. was $80,610 in 2023, according to the U.S. Census Bureau.

    A range of 70% to 80% would be about $56,000 to $65,000, which — when applying $24,000 from Social Security — implies a required nest egg of $800,000 to $1.025 million, which is still below the ‘magic number’ of $1.26 million.

    Retirement is personal

    While the ‘magic number’ may be higher than many people need, calculations that use averages, medians and rules of thumb don’t help you determine what your exact number should be — and your own situation is likely to be quite unique.

    After all, retirement is a very personal thing. If you want to estimate what your own ‘magic number’ might be, it’s worth speaking to a financial advisor.

    Many advisors have access to modeling programs that factor in your personal circumstances and plans for retirement to come up with a number that works for you. Once they know this number, they can set up a suitable savings and investment program so you can reach this goal. A helpful feature is that these models can be used to run scenarios — such as accounting for higher inflation — to see how this might affect your plans.

    There are several factors that go into figuring out your number. Where you plan to retire can make a big difference, as can what you plan to do in retirement.

    Some states are much more expensive than others for retirees, while others continue to be popular. And if you plan to travel a lot, this is likely to cost you more than if you plan to stay close to home and spend time with your children and grandchildren.

    Healthcare can be a big expense that grows through retirement. It’s impossible to predict what health challenges you may encounter, but if you already have chronic conditions that may get worse with time, it’s important to consider how this might lead to extra expenses in retirement and require a larger nest egg.

    Non-investment sources of income will also play a role. Most retirees are at least somewhat reliant on Social Security and some may have a pension — or even plan to work part-time in their semi-retirement years.

    You may want to have a ‘magic number’ — but you should arrive at it through analysis of your own unique situation. And you should be prepared to change that number if your retirement goals or circumstances change as you age.

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    This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

  • Car theft in Chicago is dropping, say police — but now these 3 brands are hot-ticket items for thieves looking to commit bigger crimes. Do you drive one of them?

    Car theft in Chicago is dropping, say police — but now these 3 brands are hot-ticket items for thieves looking to commit bigger crimes. Do you drive one of them?

    There’s good news and bad news for Chicagoans worried about car thefts.

    First the good news. With co-ordinated efforts from police, lawmakers and automakers across the country, car thefts are tracking down nationwide.

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    As CBS News Chicago reports, last year, the National Insurance Crime Bureau (NICB) observed a 17% reduction in care thefts: the biggest drop in 40 years, with fewer auto insurance claims related to car theft.

    The sea change is even dramatic in Chicago, which saw a record number of car thefts (31,565 vehicles) in 2023.

    The tide has turned in the city, as car thefts dropped an impressive 35% between January and May 4 in 2025. Chicago Police Cmdr. Andrew Costello says the numbers are definitely “trending in the right direction” overall.

    The bad news? Some numbers are trending in the wrong direction, as thieves change their methods.

    Car thieves target new group of cars

    In 2023, thieves targeted older Kia and Hyundai cars that lacked immobilizers. According to Pinkerton Consulting, thieves could hack into these cars’ electronics systems using a USB cable.

    The hacks proliferated as teen members of the so-called Kia Boyz stole vehicles and shared their exploits on TikTok and YouTube.

    Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it

    In response, Kia and Hyundai developed a free software upgrade to curb theft. The result was dramatic. In 2024, thefts of Kia and Hyundai vehicles dropped nearly 50% in Chicago. Overall, car thefts in Chicago dropped to 23,135 incidents.

    Unfortunately, police have a new problem. Now auto thieves are targeting high-end vehicles instead of Kias and Hyundais. They’re after sports cars, pickups and Jeep and Dodge SUVs.

    A CBS News Chicago analysis found that more than 400 luxury Lexus vehicles, 1,700 Jeeps and 1,500 Dodges were stolen in 2024.

    Glen Brooks, deputy director of community policing for the Chicago Police Department, reports another disturbing trend. Thieves are using these high-end cars to commit bigger crimes.

    “We sometimes have the idea that people steal your car, it goes to a chop shop and it’s divided up for parts,” he told CBS News Chicago.

    “We are seeing something completely different. We’re seeing those cars being used in robberies.”

    Cmdr. Costello said auto theft is “the gateway to larger thefts, to the robberies, carjackings, shootings,” and other violent crimes.

    Illinois cracks down on car thefts

    While motor vehicle theft remains a problem, a combination of technology and efforts by law enforcement are helping to drive stats down.

    As ABC 7 Chicago reports, Illinois has issued $11 million to law enforcement agencies statewide to help prevent carjackings and car thefts.

    That money went toward the purchase of technology including license plate readers, helicopters, and other tracking devices.

    Lt. Adam Broshous, who leads the Illinois Statewide Auto Theft Task Force (ISATT), told CBS News the technology “has been a game changer, especially in Chicago.”

    License plate readers, installed in police vehicles, use cameras and software to capture plate numbers. Officers can use the data to identify stolen cars and track where they’ve been and what they’ve been used for — potentially identifying the criminals involved.

    So far, his task force has recovered 143 stolen cars and made 85 criminal charges, including 45 felonies and 40 misdemeanors. It has also recovered 16 guns. Meanwhile, prosecutions of those involved in car thefts are also increasing.

    Glen Brooks, deputy director of community policing, told CBS News that while those efforts are making a difference, so too is educating the community.

    “If we can get to our young people, if we can make our property more secure, if we can work with our neighbors to make our neighborhoods better and safer, that will lower the likelihood someone will come to perpetrate harm,” he said.

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