Articles by Miranda Marquit

5 Tips for Reducing Financial Stress

When you look at the stresses in your life, chances are that money is at the top of the list. After all, most Americans are struggling with all sorts of money issues, from finding themselves saddled with medical bills, to having expensive mortgages and student loans that it turns out they can't afford after all.

It's a lot to think about, especially when you consider that wages aren't keeping up with inflation — and they haven't for years.

So, what can you do? If you are experiencing financial stress, here are 5 tips that can help you reduce the stress of the situation and possibly even come out ahead:

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1. Take Stock of the Situation

Part of the problem for many people is that they don't actually know where they stand. They don't know how much debt they have, and they haven't performed a cash flow analysis. Take a look at your income and your expenses, and make it a point to see where you are. It can be difficult to take that step (most of us would rather talk about our weight than our finances), and while it can be a little disappointing to see the situation, the reality is that once you know exactly where you stand, it's easier to see where to go next, and that can reduce your stress.

2. Get Help

You might not want to talk to others about your situation, but you can reduce your financial stress by getting help. If you don't know where to start with your finances, a professional opinion can help you on your way. Plus, sharing your difficulties can help you get a load off your chest. Look for a trustworthy financial professional who can advise you, and help you sort out your options. Getting that help can be a relief, and being able to know what to do is stress relief itself.

3. Make a Plan

Whether you get professional help making a plan, or you create a plan on your own after looking at your situation, just the act of making a plan can help you reduce financial stress. Many of us feel better when we feel as though we are in control of the situation. Having a plan adds an element of control. Create your plan (or get help creating one), make sure it's doable, and then start following it. When you follow a plan, you know the end is in sight, and that can help.

4. Focus on What's Important to You

Much of the stress that comes from debt has to do with the fact that many of us are in debt because we're trying to keep up with the neighbors. We buy what they have without thinking about whether or not it's something we want. Instead, set your own priorities and focus on that. You'll get more satisfaction from your finances and feel less stress, knowing your resource use matches your values.

5. Take Action!

Start doing something productive. Taking action can reduce stress and put you on the right track. Start a side hustle. Open a brokerage account with $50 and start investing. Put an extra $100 toward your credit card debt. Get started, and you'll feel better almost immediately. Knowing you're on the right track is a big help.

Paying for Education: How to Understand Financial Aid Letters

By Miranda Marquit 1 Comment

It's been more than 15 years since I began looking through financial aid letters. At the time, I organized my school choices by scholarships I received, and only thought about student loans after looking over the scholarship awards.

However, it's not always that cut and dry when it comes to reading financial aid letters these days. Often all of the information is lumped together, and it's hard to separate the scholarships and grants from the loans, according to an article on Yahoo! Finance.

According to the article, here are some of the items that trip up parents and students as they attempt to make informed decisions about where to attend school based on cost:

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Missing Costs

Sometimes, you don't end up with information about the total cost of attending the school. Anyone who has attended college knows that it's not just about the tuition and fees. There are living costs associated with college. From food and board, to books and other costs, the cost can really get out of hand.

Don't rely on financial aid letters to help you nail down total cost. The Consumer Financial Protection Bureau can help, as can the College Board. Get the total picture so that you know how much you will be short on total costs after financial aid is applied.

Is It a Loan, or a Scholarship?

Many aid letters don't make it clear how much being offered is the result of a federal student loan, or a parent loan (PLUS). In some cases, a letter might list the total aid at $20,000 a year, but it's not clear that only $5,000 of that is in scholarships and another $5,000 in grants, leaving the remaining $10,000 as student loans each year. Additionally, the Yahoo! Finance article points out that sometimes the financial aid letters only use designations like “LN” to let you know that something is a loan. You might not be clear on these designations, and think that you are completely covered from non-loan sources when you aren't.

It's important to carefully examine financial aid letters and separate out the gifts and grants from the loans. You should also look carefully for terms and conditions. One of the “full ride” offers I received from one school specified that I had to live in a specific dorm and that I had couldn't change my major from physics. If I had accepted that offer, I'd be on a completely different career path — or saddled with even more student loan debt than I have now due to a change of plan during college.

If you have questions, call the school and talk with a financial aid counselor who can provide you with specific information about what's what.

Watch Out for Front Loading

Finally, the Yahoo! Finance article warns that you could be looking at front loading. This is a practice in which schools offers more grants for the first year (and maybe the second year), and then switches to loans later. It looks like you are going to school for free — and you are for a year or two. But then your aid changes to something that has to be paid back. Be on the watch for this sneaky trick to make you choose a school that might cost more in the long run, even though you are going for free initially.

You always have to pay careful attention if you want to avoid costly surprises down the road.

How To Handle A Canceled Flight

By Miranda Marquit 3 Comments

I‘m getting ready for a few months that include quite a bit of travel.

While I don't usually run into problems when I fly, my husband has had a couple of experiences with canceled flights.

Twice he's experienced flight cancellations in the midwest due to tornadoes. And, of course, if you travel during the winter you might run afoul of extreme weather.

If your flight is canceled, how you handle it matters. While it's never pleasant to be stranded, the reality is that you can make the situation better or worse, based on your actions. Here are some things to keep in mind:

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Remain Calm and Polite

It doesn't help anyone when you get bent out of shape and become rude. No one is happy in the situation of a canceled flight. The airline personnel aren't happy, and your fellow passengers aren't happy. Try to remain calm and polite. Wait patiently in line, and find out what your options are.

In most cases, airlines will book you on another flight without charging change fees or charging you for applicable upgrades. Additionally, you are usually booked on other flights if your cancellation disrupts the rest of your trip. Remind yourself that the airline workers are doing their best, and that you will eventually get to where you are going.

Consider Pointing Out Your Value

You can politely point out that you are a good customer. Of course, this has to be the case. If you only fly with an airline occasionally, making a trip or two a year, you aren't going to impress anyone. However, if you are a frequent traveler, and you point out that you've flown on the company's airlines 40 times in the last year, you might get a little more help.

Customers that are elite members of an awards program also get preferred treatment. That's just the way it is. If you are a frequent traveler, or if you pay extra money for First/Business class, or if you belong to some elite club, you are going to get better treatment, and the airline will work harder to accommodate you. It might not be fair, but it's the way of the world and of business.

You don't have to pay a lot for this preferred treatment, though. In some cases, you can get an upgrade to elite status for $50 to $75. You get access to the airline's lounge and you are more likely to get access to airline employees who can help you.

Be Prepared with Funds and Trip Insurance

For major trips, I buy trip insurance with my ticket. This is more about getting a refund if certain events prevent me from going on the trip after all. However, it can be one way to get a little more leverage with the airline, and ensure you get back what's yours if a canceled flight ruins your vacation.

You should also be prepared with plenty of funds. Make sure you have a credit card with plenty of room so that you can pay for an unexpected night in a hotel, or buy food. My husband was offered hotel and food vouchers the last time he had a canceled flight, but fewer airlines are offering these days. Even if you try to get a refund later, you need to be prepared to take care of yourself right now. Ask for vouchers, but make sure you are ready, just in case the answer is no.

Have you ever had to deal with a flight cancellation?

Your Grocery Bill Could Rise with Dairy Prices

By Miranda Marquit 1 Comment

One of the items that consumers have to contend with is inflation. Prices are always going up — even if wages are stagnating. Recently, one of the areas that has seen some rather dramatic inflation is dairy. According to Marketwatch, dairy prices rose 0.7 percent between January and February of 2014, and milk has risen by 10 cents a gallon since September 2013.

What does this mean for your grocery budget? It means that you could be spending more at the store. Rising dairy prices mean that you pay extra for more than just milk. Cheese, butter, cream, and other items also cost more when dairy prices rise.

If you are looking for a little inflation protection when it comes to your food budget, here are some things to consider:

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Cut Back Your Dairy Consumption

One of the easiest ways to reduce your dairy costs is to cut back on your consumption. This might be easier said than done for some people, though. I enjoy dairy, so it's hard for me to cut back. Consider less expensive alternatives, and do your best to find ways to reduce what you are spending on dairy. If this isn't an option, though, you do have other choices.

Reduce Other Grocery Costs

Another option is to make up for it by reducing other grocery costs. According to the Marketwatch article, you probably won't pay more than $1 per item extra as a result of higher dairy costs. If this is the case, it might be possible to cut back in other areas to keep your grocery costs low. Consider cutting back on treats and junk food. You can also make an effort to find coupons and sales. This can be a way to reduce your grocery costs without cutting your dairy consumption.

Consider Local Sources for Dairy

Even though the average cost for dairy has risen in recent months, I'm not actually paying more for these products. This has a lot to do with the fact that most of my dairy is locally sourced. I get milk straight from the dairy up the road, so increased transport costs and other problems don't affect my milk costs. I also get cheese from the same dairy, and from a local cheese outlet.

While I expect prices to rise eventually on the dairy items I buy locally, the good news is that the price increases generally lag behind national trends. So, I have more time before inflation (at least on dairy products) kicks in.

Pay Attention to Inflation

It's a good idea to pay attention to inflation in other aspects of your budget as well. Prices continue to rise, and your income might not keep pace. It makes sense to track your spending, and make adjustments as necessary. You might need to earn more money (perhaps a side gig) or cut costs in order to avoid becoming a victim of inflation. Whatever you do, though, it helps to stay on top of the situation before your budget is busted. Pay attention and create a plan that works for you and your situation.

Can You Trust Your Tax Preparer?

By Miranda Marquit 2 Comments

My tax preparer is a life saver. Ever since I formed my LLC and began investing, my taxes have been a bit on the complex side. As a result, an accountant prepares my tax returns each year (one for the business, and one for my husband and me, plus our state tax return). This makes my life easier, since I don't spend hours filling out the forms and tracking down the latest information on tax law changes.

I'm fortunate because I trust my tax preparer.

My accountant will represent me to the IRS free of charge if I'm audited, and he makes it a point to go over the return with me before we send it in. I'm pretty sure that he's doing what he should, and he keeps to the requirements of a CPA.

Not everyone is so lucky, though. A relative of mine recently found out that his tax preparer was engaging in some shady practices. Now he's being audited, and the tax preparer is refusing to represent him — unless he pays even more.

After reading a recent article on CNN Money, it seems as though my relative isn't alone. Apparently there is a rash of poor tax preparers that can land you in hot water.

Lack of Regulation

While many of us grumble at the regulatory requirements of bureaucracy, there reality is that, in some cases, regulation can protect you. Regulations that require lenders to disclose your “real” interest rate before you sign on the dotted line, and that require transparency as to the full cost of your loan, can help you better understand your commitment. This protects you and allows you to make informed decisions, since, in the past, lenders had taken advantage of the general public's ignorance on some topics in which they lack expertise.

One of the issues with tax preparation is that there aren't many regulations that require tax preparers to be properly licensed in some states. According the CNN Money article, there are 46 states that have more regulations for hairdressers than tax preparers. In many cases, a brief course is all it takes to become a tax preparer. And, technically, I could start offering my services as a tax preparer. All I have to do is fill out your tax return.

However, it's not just a lack of expertise that can be problematic. Your tax preparer might be making honest mistakes due to a lack of knowledge, and that is frustrating, but it isn't malicious. What's hard is when you run into tax preparers who are little more than scammers. They engage in questionable tactics to save you money (as with my relative) so that you will keep coming back, with little regard to IRS guidance.

Others are outright scammers, stealing your identity and promising huge tax refunds. These refunds are usually the result of adding fake children to boost your EIC and exemptions, deducting things that shouldn't be deducted, and engaging in other activities. When these things happen, you are charged penalties and could be in bigger financial trouble.

Carefully vet your tax preparer. Solid credentials are a good start, but they aren't everything. Be wary of preparers that charge a percentage of your tax refund, rather than a flat fee, and watch out for those that talk of “special government programs” and “grants” you can apply for through your tax paperwork. Such things don't exist. If you feel uncomfortable with your tax preparer, heed your gut and go elsewhere.

4 Financial Things to Talk About Before Marriage

By Miranda Marquit 3 Comments

Before you tie the knot, it makes sense to get to know your potential marriage partner. One of the things it helps to know is how your potential partner will deal with finances.

My husband and I got engaged after three weeks, and married two months after that. We didn't have a lot of time to get to know each other — although we did spend a lot of time together talking about important things. We did talk about some money issues, but probably not all the issues we should have.

Before you get married, and especially if you decide to merge your finances, here are 4 financial things to talk about:

1. Debt

things to talk about before marriage This is one of the most important things you need to discuss before you tie the knot. My husband and I talked about student loans, my credit card debt, and his car loan before we got married. You should come clean about your debt, and what you're doing about it, and your potential mate should come clean as well. Have an open and honest talk about the debt situation, and how you will tackle it together. This is a great time to lay a foundation for avoiding high-rate consumer debt in the future.

2. Income

It can be difficult to talk about income sometimes, since our society places so much emphasis on income and salary as status symbols. You might not want to appear as though you aren't making “enough.” Also, it can be uncomfortable if one of you makes a lot more than the other.

Talk about your expectations for the earning situation going forward, including whether or not you have a goal to become a one-income family (or one of your working part time) as part of your arrangements. These are things to talk about now, so that there aren't major surprises later.

3. Paying the Bills

How will you pay the bills? If you decide to completely merge your finances, like my husband and I did, this isn't as a big a deal since everything goes into — and comes out of — one big pot.

If you keep some separate accounts, though, this needs to be determined. Who will be responsible for which bills? Will you have one shared account for shared expenses, like housing, utilities, and groceries? If this is the case, then you need to figure out how much you each need to put in for these items. A percentage of income, based on what you each make? Or some other method?

This is not a fun conversation, but it's one that needs to be had.

4. Financial Priorities

Don't forget to have a talk about financial priorities. You need to determine what is most important for you to spend money on. This was something my husband and I didn't do, so it was a little surprising later to discover that we didn't always have the same ideas about how to spend our money.

The good news is that we share the same views on saving for retirement and what we are willing to go into debt for, as well as how to spend on our son. The other stuff has been worked out.

Making sure that you are financially compatible (or at least working toward it) can be a big part of harmony in your finances. Talk about these things before you get married so that you can work out any huge differences and problems ahead of time.

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