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| Stat Of The Day |
| Seattle |
Let’s hear it for the Emerald City. No, not that Emerald City. We’re talking about Seattle. It topped Wallethub’s recent ranking of cities with the best budgeters. According to the analysis, Seattle residents have some of the country’s lowest debt-to-income ratios for credit card debt, student loan and car loan debt. |
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| Breaking Free From The Bank Of Mom And Dad |
According to a recent Pew Research Center report, just 45% of young adults say they’re completely financially independent from their parents. Those who aren’t, frequently have costs for things like household expenses and cell phones covered by the "bank of mom and dad."
If you’re a parent in the throes of continuing to support your adult child financially (and at the same time, trying to pursue your own goals, like saving for retirement), you might wonder: How do we give them a nudge toward financial independence?
On HerMoney.com, we’re covering the four best ways to cut the financial cord and help the young adults in your life find financial independence. One of the big ones: offering help in the form of information, not cash. For example, you can help them make a budget, track their expenses, or figure out a side hustle so they can boost their income.
For those who want to dive a little deeper, we have a dedicated young adult version of our popular FinanceFixx course starting tonight. During this 4-week course, your kids will get the kind of money makeover that can start putting them on a path to lifelong financial independence. Sign up here and use code SAVENOW for a special discount. |
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| This Week In Your Wallet |
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Are you a side hustler? If so, you might be wondering how to pay taxes on your extra income. According to the IRS, the rules are pretty simple. You must file a tax return if you have net earnings from self-employment of $400 or more from gig work, even if it’s a side job, part-time or temporary. If you fail to report and are audited, you could face a "failure to pay" penalty. "You might also be assessed an accuracy-related penalty equal to 20 percent of the underpayment if you purposely underreported your income and substantially understated your income tax liability," Shomari Hearn, executive vice president and chief operating officer of Palisades Hudson Financial Group, tells HerMoney. For more of what you need to know about paying taxes on side hustle $$$, click here.
As talk of abolishing the Department of Education continues, the Trump administration is slashing jobs at the agency – and it’s having a ripple effect on student loan borrowers. "Staffers at the Education Department tasked with fielding complaints from federal student loan holders and resolving their issues were let go in the recent job cuts," CNBC reports. At least eight fired employees were working on nearly 800 student loan borrower complaint cases, according to CNBC. "The student loan system is broken, and right now there’s nowhere for borrowers to turn," says Persis Yu, of the Student Borrower Protection Center.
Worry less. Talk it through. Think for yourself. Understand what's influencing you. These are words of wisdom from Jonathan Clements, a longtime personal finance columnist at The Wall Street Journal and founder of HumbleDollar.com. As he continues to face a terminal cancer diagnosis and looks back on his life and career, he says these four pieces of advice are the most important. Topping his list is worrying less – about money, and life in general."Often, when it comes to money, the path to less worrying involves simplifying our finances, keeping a healthy cash reserve, settling on the right stock-bond mix, making sure we diversify broadly, limiting debt, buying the right insurance, getting our financial affairs organized and listening less to market pundits," writes Clements. |
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| Things That Make You Money |
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| Ask Jean |
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| Q: |
Today’s question comes from Katrina. She writes: I am looking for info on the best way to get out of a timeshare. Do you still recommend I just stop paying? |
| A: |
Once upon a time, I wrote about this exact issue for AARP. Shortly after, my editor was inundated with letters from people who were also looking to get out of their timeshare. Suffice to say, it’s a pretty common problem.
First, I would call the timeshare company and ask about the process for getting out. When you call, ask specifically for the person who handles "deed-backs" or "surrenders," which is when you return your property to the company, likely for a fee of a couple hundred dollars or so. Sometimes there’s some sort of process where you may be able to just deed it back to the timeshare company.
If that doesn’t work, you could stop paying – but consider all aspects of the situation. If you took a loan to buy the property, and there’s still a balance, stopping payment will cause your credit to take a hit. Alternatively, if you simply stop paying annual fees, it’s possible the company won’t report it to credit bureaus. Sometimes, stopping fee payments will push companies to allow you to surrender. That’s because accepting a surrender typically costs them less than foreclosing on the property.
You could also list the property on the resale market. RedWeek is one of the most popular spots for this. However, you probably won't make much unless you have a higher-end timeshare (like those via Disney, Marriott, or Hilton). That said, if you do find a buyer, you deed that person the property, and they will be responsible for the fees. "Another option is to reach out to other owners and ask if anyone wants to buy another share," suggests Certified Financial Planner Kashif Ahmed, founder and president of American Private Wealth. "Many people buy multiple shares in the same property or company."
Lastly, you could enlist the assistance of a company to help you exit your timeshare – but proceed with caution. "There are companies that advertise offering services to help you get rid of your timeshare, but be careful as many of them are scams," warns Ahmed. If you go this route, know the fees will be high (thousands of dollars) and only do business with a company that’s been in business 5 years or more, and doesn’t have a blemished record with the Better Business Bureau. |
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| Submit your questions to Jean here. |
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