Can You Afford to Not Have Health Insurance?

via MoneyNing:

One of the biggest financial news stories right now is the approaching deadline to sign up for health insurance under Obamacare. If you aren’t covered by a health plan right now, you have until March 31, 2014 to sign up — or face the possibility of a penalty next year when you file your tax return.

Before you decide that paying the penalty is cheaper than buying health insurance coverage, however, it’s a good idea to consider the possible costs associated with not having insurance.

The High Cost of Medical Care

Health care in the United States is quite expensive. If you have a catastrophic accident or illness, your pocketbook could be affected — even if you have insurance. Without coverage, the effect can be devastating. According to a recent study from NerdWallet Health, one of the biggest factors in bankruptcy filings is medical bills.

Can you imagine the cost of a hospital stay out-of-pocket?

Health insurance can help you cover those costs. Even seemingly healthy people get sick, and you never know when an accident will strike. So, while you might think it’s cheaper to pay the penalty and avoid the coverage, the truth is that you’re taking a risk with your finances.

How to Reduce Health Insurance Costs

One of the hardest things for some consumers to do is buy health insurance when they have relatively few health needs. This is a bit of a challenge for me, since we mainly just go in for preventative care, along with a couple of regular prescriptions. We really don’t spend much on health care.

However, I do like to have insurance, just in case. What happens if my son falls on the playground and breaks his arm? Or my husband ends up with a major illness and has to stay in the hospital for a week? I feel better knowing these situations won’t bankrupt me, because the health insurance is there to help.

In order to make it a little more palatable, I make an effort to reduce my health insurance costs. One of the ways you can reduce your premiums (if you have few health care needs) is to get a high deductible plan. You pay more out of pocket, but your monthly premiums are much lower. You can combine this plan with a Health Savings Account to get a tax deduction and save up for the out-of-pocket costs. I’ve found that the HSA is a great way to help me reduce my overall health insurance bills.

If you don’t have coverage right now, and you qualify to buy on the exchanges, you might be eligible for a subsidy. Some consumers can buy a “Bronze” level health plan on the exchange for a very small amount, once the subsidy is considered.

Before you make any decisions, run the numbers. It might make sense for you to get health coverage after all.

Do you have health insurance? If not, have you signed up for coverage under Obamacare yet?

This article originally appeared on MoneyNing.com. Let us know what you think (or read what others thought) here.

Related posts:

1. Health Savings Accounts Are Great for Those with Inexpensive Health Needs


2. What You Need to Know About the ACA Health Insurance Exchange


3. 9 Ways to Beating the Health Insurance Woes

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How Securities Crowdfunding Could Change the Way You Invest

via MoneyNing:

As technology advances, more people have access to investment opportunities than ever before. Just about anyone with $25 and an internet connection can open a brokerage account and start trading on the stock market. The next evolution in investing could very well be “securities crowdfunding,” in which ordinary people have opportunities to invest in small businesses and startups with greater ease.

“There are expectations that at some point in 2014, securities crowdfunding will become legal for all investors,” says Chris Tyrrell, the CEO of crowdfunding platform OfferBoard. He’s referring to a law passed not too long ago that allows for securities crowdfunding.

Right now, businesses looking to leverage social fundraising for their businesses use sites like Kickstarter and Indiegogo. However, this isn’t investing. Those who contribute to such campaigns receive no ownership in the business and are issued no stock. Instead, they’re offered “thank you” gifts and perks.

What Is Securities Crowdfunding?

Securities crowdfunding would be different. Businesses could use this model to raise money and offer investors ownership in the company. In fact, certain investors already have access to this type of investment.

“Title II of this legislation deals with accredited crowdfunding, and became legal on September 23, 2013,” Tyrrell explains. “Accredited investors are those with more than $1 million in net worth or an individual income of $200,000 per year.”

Right now, these investors are the only ones who can take advantage of the new crowdfunding rules. But for them, it provides opportunities that were previously only available to venture capitalists and angel investors. According to Tyrrell, “Crowdfunding platforms like OfferBoard offer investors the ability to find middle market companies that are growing, commercializing, and recapitalizing.”

Everyone’s Invited

The next stage of the crowdfunding law, though, would include everyone. “The Title III section of the law is still in review,” says Tyrrell. “It will be in comment period until February 3, 2014, but there seems to be an interest in getting it approved quickly.”

Title III crowdfunding will be aimed more at helping startups and other early-stage businesses. These businesses will be able to raise funding through small investments from individuals, and they can raise up to $1 million this way. “And anyone can invest,” Tyrrell says. “It’s not just for accredited investors. Anybody can invest in a startup and take the chance of seeing a good return.”

Of course, turning everyone into a venture capitalist comes with risks. This is part of the reason that the wider provisions of the crowdfunding bill are delayed — compared to those offered to accredited investors. “Regular” investors are less able to absorb the risk that comes with investing in early-stage companies.

How You Can Get Involved

For investors looking to diversify a little bit by investing in small business, however, the new crowdfunding rules could come as a boon. As long as you complete your due diligence, and focus on solid companies with good business plans, you could expand your portfolio to include these types of publicly offered private securities.

Securities crowdfunding is also likely to help businesses. “Now you can go advertise to a wider base,” says Tyrrell. “You have broader network access, and this can help early-stage companies raise money early on.”

What do you think? Would you participate in securities crowdfunding?

This article originally appeared on MoneyNing.com. Let us know what you think (or read what others thought) here.

Related posts:

1. Is Crowdfunding Endangering Our Work Ethic?


2. How Much Should I Invest Abroad


3. Should You Invest in Precious Metals?

For more info: How Securities Crowdfunding Could Change the Way You Invest

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How Securities Crowdfunding Could Change the Way You Invest

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Personal Finance, investing, money management, money news, trading

4 Tax Changes You Should Know About in 2014

via MoneyNing:

Now that we’re starting a new year, it’s time to pay attention to the tax updates that are coming in 2014. Your tax planning should take into account two main things.

First, be aware of changes for your 2013 taxes so you file appropriately by April 15, 2014; second, realize that changes taking place in 2014 will affect the way you plan your finances for the coming year.

As you sort through your taxes for the 2013 filing season, and as you plan for the 2014 tax year, the tax preparation company Jackson-Hewitt suggests you keep these four things in mind:

1. Additional 2013 taxes for high earners

Hopefully you’ve already planned for this, but in case you haven’t, now is the time to address the issue. Tax year 2013 marked the implementation of two new taxes for high earners: a 0.9% Medicare tax and a 3.8% tax on unearned (investment) income. Ask your tax professional about these taxes. If you’re subject to them, you need to prepare to pay them by April 15, 2014.

And, of course, you can take steps to mitigate the problem going forward. Good planning can go a long way.

2. Joint returns for same-sex couples

Thanks to the recent Supreme Court ruling on DOMA, married same-sex couples can now file joint federal returns. Not only that, but it’s possible to amend past returns (up to three years back) to reflect the filing status.

It’s important to understand that this is just for federal returns. The IRS has decided that it’ll accept joint returns from couples legally married in any state, but those who reside in states not recognizing same-sex marriage might not be able to file joint state returns. This means it could get a little tricky for same-sex couples filing their taxes.

3. Tax breaks expiring at the end of 2013

If you’ve relied on certain tax breaks for the last few years, you might be disappointed to find that some of them expired at the end of 2013. These include:

• Deduction for PMI payments


• Credits for certain energy-efficient home improvements


• Deduction for university tuition and fees


• Deductions for teachers who purchased classroom supplies out of their own pockets

While Congress might act to retroactively extend some of these tax breaks, pay attention so you know what’s happening and how it applies to you.

4. Changes from the debt-ceiling battle

The next debt-ceiling battle is sure to involve some sort of tax change, and it could affect you — especially if you’re a high earner. On top of that, if there’s another government shutdown, delays could be seen during the tax-filing season. Get your tax return prepared as soon as possible so you’re not trying to figure out what to do when delays become a problem.

Though those are four things you should be aware of this tax season, be sure to speak with a knowledgeable tax professional who can help you work through your specific situation.

Will any of these changes affect you?

This article originally appeared on MoneyNing.com. Let us know what you think (or read what others thought) here.

Related posts:

1. How a Divorce Can Affect Taxes


2. How the Fiscal Cliff Could Affect You


3. Why Buying or Refinancing a House Might Be Harder in 2014

For more info: 4 Tax Changes You Should Know About in 2014

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4 Tax Changes You Should Know About in 2014

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Why Americans Are Spending Less This Christmas

via MoneyNing:

The results are in: the latest Gallup poll shows that more Americans prefer saving money to spending it. This is no news to retailers, as many major chains have been experiencing unusually low sales for the holiday season. Sales through Thanksgiving and Black Friday were surprisingly lackluster — a warning sign that, for various reasons, shoppers aren’t feeling as spend-happy as they have before.

While reasons for spending less this Christmas are likely as unique as the individual, here are a few of the main motivators behind this spending trend.

High rates of unemployment

In the last several years, national unemployment rates have been above 7%, higher than the “healthy” 5-6% range we’ve experienced in the past.

The loss of a job, or the inability to find one, has many families scrambling to pay their bills, and has significantly reduced discretionary spending.

On a hopeful note, the unemployment rate is trending to drop to 7.2%, the lowest in five years. This is largely thanks to an increase in jobs. Employers have added roughly 200,000 new jobs each of the last four months, a good sign that the unemployment rate may continue to drop, allowing the economy to experience a boom. On the other hand, if spending continues to remain cautious, it could hurt the economy.

Doubts about the economy

The recent government shutdown left many people worried about the future of our economy. Some who are dependent on government welfare programs, such as SNAP or WIC, are already expecting to see cuts to their benefits — and may see even more if the government chooses to reform the system. This concern, of course, has affected their spending.

Then there was the controversial and tumultuous launch of the Affordable Care Act. One of its unforeseen side effects was that many insurance providers were forced to eliminate some plans and policies, directly impacting thousands of insured workers. (Thankfully, a provision is being made to allow current policies to remain in effect for a year’s time.)

In addition, insurance costs for some people are expected to increase. Those affected will likely be more cautious with their spending this holiday season.

A shrinking from consumerism

Those who’ve seen the effects that excessive credit and and speculation had on the housing market, as well as the economy in general, are shrinking away from debt. This is especially true of both Millenials and Generation Y, who are learning from the mistakes of the previous generations’ debt problems.

It also appears that people are just tired of the materialism and consumerism that’s so prevalent in our culture. Many big-name retailers caused protests and boycotts this year because of their even earlier Thanksgiving Day sales, which cut into what many consider family time.

A desire to reach savings goals

It makes sense that if you keep on spending and not saving, you won’t be able to accomplish your financial goals, whether they’re as simple as starting an emergency fund, or as significant as buying a house. People are catching on to this and, as the Gallop poll indicates, are choosing to save. Saving really is the key to financial freedom.

While this trend may disappoint retailers, who have been extending deep price cuts into December in hopes of boosting their sales, it won’t disappoint those who are able to regain control of their finances.

Have you cut back this Christmas? Why or why not?

This article originally appeared on MoneyNing.com. Let us know what you think (or read what others thought) here.

Related posts:

1. 5 Ways to Curb Compulsive Spending This Christmas


2. More Americans Are Planning for Retirement. Are You Among Them?


3. 4 Tips for Avoiding Extra Spending Just Because You Have a Coupon

For more info: Why Americans Are Spending Less This Christmas

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Is Innovation Destroying Jobs? Or Creating Them?

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There’s been a flood of technological advancements in the last few decades, many of which have dramatically streamlined processes in our everyday lives. These innovations have led to more efficiency in many sectors, including business and manufacturing.

As a result, some outdated systems, equipment, and job titles are quickly becoming obsolete. Businesses or even entire fields have gone under, a mass of unemployed workers in their wake.

We’ve seen this happen most clearly in manufacturing. Robotics and automation have increased production efficiency and eliminated the need to employ as many workers, forcing many people to seek entirely new careers later in life.

When Innovation Affects Your Career

Being unexpectedly forced to change careers, or the focus of your company, can be traumatic and life-altering. It also leaves everyone feeling a little less secure about their future (if it happened to others, it can happen to you).

There’s no doubt that finding yourself suddenly unemployed is a difficult situation. If you have little or no savings set aside, your finances will be strained and your lifestyle threatened.

Finding a new job may also prove difficult, because you have to either:

• Settle for a job below your skill level and/or current salary


• Learn a new trade or return to college to acquire a new degree

These steps aren’t easy and can cause financial stress, but are necessary in order to move on. Many people do both: settling for a lower-paying job temporarily while completing training for a new career.

Because of these effects, it’s easy to see why people have been opposed to technological advancements throughout the years.

But are advancing technology and innovation really to blame for unemployment? Well, yes and no.

Innovation = Loss of Jobs

In the short term, yes, certain advancements will immediately result in a loss of jobs. The more large-scale the advancement, the greater the number of displaced workers. We can see this demonstrated in history during any major change to industry.

It’s no wonder many people are distrustful of new technology in the form of robotics and computerization; being replaced by a machine is a fate no one desires. It’s also natural to blame companies who benefit from technological advancements that enable them to downsize their workforce and, therefore, reap a higher profit.

Innovation = Future Opportunities

On the other hand, though innovation in science, engineering, and mechanics will cause immediate losses, it’ll also create equal, if not greater, opportunities in the future. Innovations save everyone time, money, energy, and other resources while increasing efficiency and efficacy. Even though there are some negative effects due to the changes they require, the ultimate result is usually good.

What’s more, advancements almost always create new jobs, opportunities for growth, and new business opportunities.

Even losing your job and being forced to return to college or trade school can be a blessing in disguise. We all know that it’s easy to get stuck in a rut and lose our ability to adapt and learn new things. Would you rather be very good at one thing (that may lose its usefulness) or be moderately good at many things?

Being forced to to learn a new skill set or begin a new career enables us to better ourselves by:

• Revealing hidden talents, abilities, and aptitudes


• Utilizing abilities we’re good at or enjoy, but weren’t able to use before

Since technology and career fields are changing so fast, it’s necessary to do market research into your chosen field to see if there’s room to grow, or if the demand for that job is dying out. You may still be caught off guard, but if you’re willing to learn, work hard, and, most importantly, change with the changing of the times, you’ll have no difficulty finding your new niche and means of financial security.

What do you think? Is innovation helping or hurting our jobs?

This article originally appeared on MoneyNing.com. Let us know what you think (or read what others thought) here.

Related posts:

1. Best Jobs in 2010


2. The Ups and Downs of Seasonal Jobs


3. Great Summer Jobs that are Often Overlooked

For more info: Is Innovation Destroying Jobs? Or Creating Them?

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