On this Memorial Day Weekend, we honor the men and women of
the United States who put everything on the line to protect our country and the
freedom we hold. In 1944, President Franklin D. Roosevelt signed the VA loan
into law helping Veterans achieve the American dream. In 1970, under President
Nixon, the VA loan landscape changed with the Veterans Housing Act of 1970. There
was no longer a time limit on loan eligibility, and veterans now had the option
to refinance into another VA loan. Today, the VA loan has guaranteed more than
24 million homes across the United States.
VA Home Loan Military and Service Requirements:
With a VA loan, there are service requirements that need to be
met in order to qualify. These are based on the time period during which you
served, and the number of days active duty. For example, if you are currently
active duty, you would have had to of served 90 continuous days to meet the
requirements. For a further breakdown, those who served during:
WWII – a total of 90 days, or less than 90 days if you were discharged for a service-connected disability
Post-WWII – 181 continuous days or less than 181 days if you were discharged for a service-connected disability
Korean War – a total of 90 days, or less than 90 days if you were discharged for a service-connected disability
Post-Korean War – 181 continuous days or less than 181 days if you were discharged for a service-connected disability
Vietnam War – a total of 90 days, or less than 90 days if you were discharged for a service-connected disability
Post-Vietnam War – 181 continuous days or less than 181 days if you were discharged for a service-connected disability
1980-1990 – 24 continuous month or 181 days that you were called into active duty
Gulf War – 24 continuous months or 90 days in active duty, at least 90 days if you were discharged for a hardship, a reduction in force, or convenience of the government or less than 90 days if you were discharged for service-connected disability
If you separated from service after September 7, 1980 – 24 continuous months, 181 days of active duty or less if discharged for hardship, a reduction in force, convenience of the government or a service-connected disability
On Memorial Day, we honor those who have given their lives for
our freedom. For those who have a spouse serving or who has served, you may be
able to qualify for a VA loan through a Certificate of Eligibility. However,
there are requirements that you will need to meet as well. Most, COE’s are
given to those surviving spouses of a Veteran or the spouse of a Veteran who is
missing in action (MIA) or being held as a prisoner of war (POW).
However, you meet these requirements, be sure to talk to your Total Mortgage Loan Officer about
your options to be able to receive a Certificate of Eligibility (COE).
Credit Score Requirements for VA Home Loans:
VA loan credit score requirements are similar to USDA
credit score requirements. The Veterans Administration or the VA
doesn’t set a minimum credit score requirement, however, the lender is able to
set a benchmark. Typically, the benchmark for a VA loan is set at a 620 FICO
score. This does not mean that you will not be approved with a lower score.
Your credit score eligibility will be determined once a credit report and
analysis are complete. No matter your credit score, there is always room for
improvement.
VA Home Loan Down Payment Requirements:
Another advantage of a VA loan is the down payment, or lack
thereof. Once again, similar to USDA loans, VA loans don’t require a down
payment from borrowers. In fact, about 90% of VA loan holders borrow the loan
without a down payment placed on the loan, although when a down payment is
made, the VA Funding Fee decreases.
A VA Funding Fee on a first-time VA borrower is typically 2.3%
of the loan when no down payment is made. When a down payment of 5% is made by
the borrower, the fee drops to 1.65% of the loan. As the down payment amount
increases, the VA Funding Fee decreases.
The down payment on a VA loan does not have to come from your
accounts. It is acceptable for a down payment gift to be given on a VA loan. If
the down payment is a gift, a letter is required and needs to have the donor’s
information, relationship to the borrower, details about the gift, and legal
phrasing that states that the payment does not need to be repaid.
What are my options:
Depending on your credit score and where you would like to
live, you have more options available to you. Here are some of the most
noteworthy loan options:
VA Loans – Are serving and meet the requirements? Is your spouse a Veteran or MIA or POW?
Benefits:
No down payment requirement
No credit score requirement, lender may set one
USDA Loan – Are looking to live in a rural or suburban area?
Benefits:
No down payment requirement
No credit score requirement, lender may set one
FHA Loan – Are a first-time home buyer with a credit score that is in repair?
Benefits:
3.5% down payment minimum, PMI for the life of the
loan
Lower credit score requirements set by lenders
Conventional 97 Loan – Are you a first-time home buyer who has a good to excellent credit score?
Benefits:
3% down payment minimum, 20% down payment without
PMI on the loan
Summary:
Mortgages are
not a “one size fits all” financial decision. VA loans offer Veterans a great
option to achieve the American Dream with no down payment required and no
credit score requirement set by the VA. However, to find the best loan for you
and your financial situation, contact a Total Mortgage Loan Officer or visit
our
mortgage builder today!
Carter Wessman is originally from the charming town of Norfolk, Massachusetts. When he isn’t busy writing about mortgage related topics, you can find him playing table tennis, or jamming on his bass guitar.
Rhode Island enacted a new law this week to make permanent a requirement that servicers provide sufficient mediation and loss mitigation efforts before proceeding to foreclosure.
The Foreclosure Mediation Act mandates lenders to advise delinquent mortgage borrowers of options available to them that could prevent loss of their properties. If a vulnerable homeowner requests mediation, the lender will be obligated to make good-faith efforts on providing a pathway toward making the loan current and may not initiate foreclosure proceedings until a coordinator affirms it has complied.
Mediation coordinators must come from Department of Housing and Urban Development-approved counseling agencies in the state and have “no authority to impose a solution.” They must meet certain other requirements requirements related to having sufficient mortgage industry knowledge, including at least three years of experience with loss mitigation guidelines
The act codifies temporary legislation the Ocean State introduced 10 years ago that was due to expire on July 1. The 2013 Foreclosure Mediation Act was originally slated to end in 2018, but given a five-year extension.
Introduced in February this year and sponsored by Sen. Dawn Euer and Rep. Leonela Felix, the legislation passed in both Rhode Island House and Senate chambers earlier this month. Gov. Daniel McKee signed the act into law on Wednesday.
“I know how devastating foreclosures can be for families and communities firsthand,” said Felix, whose family lost their home when she was a child, in a press release. “If we had had this program back then, we could have gotten on a payment plan we could afford and stayed in our home. This program has given other families security we didn’t have.”
According to RIHousing, more than 1,500 homeowners have taken part in mediation conferences since 2013. Approximately 46% of the efforts completed resulted in the borrower retaining possession of the home through loan modification, reinstatement or a revised repayment plan.
“To a lender, a mortgage might just be a line on a spreadsheet. But to a homeowner, it’s so much more than that,” Euer said. “These additional protections help people get back on their feet, stay in their homes and keep paying their bills.”
Meanwhile, officials in neighboring Massachusetts introduced similar foreclosure-prevention legislation last month.
The new state proposals come as government agencies attempt to come up with successor plans to some of the mortgage relief measures introduced during the COVID-19 pandemic. With foreclosure moratoria and forbearance offered at the federal level either already expired or sunsetting, pressure has come from the likes of the Consumer Financial Protection Bureau to ensure mortgage companies remain attentive to requirements to provide other types of new or existing assistance to distressed borrowers.
Earlier this year, the Federal Housing Administration agreed to extend pandemic loss-mitigation options to a broader range of struggling mortgage holders, while the Department of Veterans Affairs will unveil a new program in July that adds a loss-mitigation step before struggling borrowers reach the foreclosure stage.
Another sign of the priority the federal government is assigning to foreclosure prevention came in a new Department of Housing and Urban Development report this week. The agency alleged Mr. Cooper, the country’s largest nonbank servicer, failed to provide adequate home retention options to more than 80% of delinquent borrowers with FHA-insured loans after their COVID forbearance plans ended.
Last month, new foreclosure starts nationwide increased by 4% on a year-over-year basis and 5% from April, according to real estate data and analytics provider Attom. The number of distressed properties turned into completed repossessions took its biggest jump this year to 4,020 homes, 41% higher than in May 2022.
The 10-year yield (ticker: US10Y) describes what 10-year U.S. Treasury notes will pay over 10 years if bought today. Also known as T-notes, Treasury notes are a low-risk fixed-income investment that pays a set rate of interest every six months.
Considered one of the lowest-risk investments on the U.S. market, 10-year Treasurys are a “risk-free” benchmark against which other investments and debt are compared. (Three-month Treasury bills are another.)
While no investment is ever completely risk-free, Treasury notes come close if held to maturity. As a result, some investors and analysts look to demand for T-notes as one way to assess investor confidence in the economy.
Treasury notes are one of four main types of U.S. government debt securities. The others are Treasury bills, Treasury bonds and Treasury Inflation-Protected Securities (TIPS). They vary in their duration, interest payments and yields.
Competitive bid
When a bidder specifies the conditions of the Treasury (such as rate and yield) that they’re willing to accept.
Non-competitive bid
When a bidder agrees to accept whatever conditions, such as rate and yield, are established at the auction.
The face value of a Treasury note, or what you pay to loan the government money.
Treasury bill
The shortest-term U.S. debt security, Treasury bills mature in less than a year. They’re also known as a zero-coupon bond. T-bills do not pay interest like other Treasurys, and instead are sold at a discount. The difference between the face value of the T-bill and its discount rate is the “interest earned.”
Treasury bond
A long-term U.S. debt security maturing in 20 or 30 years.
Treasury note
A type of U.S. debt security maturing in 2, 3, 5, 7 or 10 years.
Market ticker for the 10-year Treasury yield.
The interest rate the U.S. government pays on its debt, or how much you can earn from investing in a Treasury note.
Price vs. yield
Treasury prices and yields tend to move in opposite directions, and are affected by supply and demand and the health of the economy. The purchase price or face value of a Treasury note is what you pay to buy it. The T-note’s yield is the interest rate you earn for loaning the government money.
Treasury notes are sold at auction through a bidding process. The Treasury first accepts any noncompetitive bids, or bids from investors who accept the current T-note rate and yield. Then, the Treasury accepts the highest competitive bid.
If demand for Treasury notes is high, they may sell for more than their face value. If demand is low, on the other hand, Treasurys can sell for less than their face value.
The Treasury may raise the yield of newly issued 10-year notes if the price of existing 10-year notes starts to fall on secondary bond markets (because of market forces like inflation). If there’s high inflation, for example, the potentially higher yield of newly issued 10-year notes will make them more attractive than previously issued T-notes.
This effect is also known as interest rate risk and is most relevant for investors trying to sell T-notes on a secondary market. If held for their full duration, Treasury notes still pay their coupon payments and principal in full. But if a T-note-holder were to sell early, they may have to discount the price.
Longer-term investments tend to offer higher yields to offset any potential price impact from interest rate or other risks.
Why is the 10-year Treasury yield important?
As one of the lowest-risk investments on the market, the 10-year Treasury and its yield are important for several reasons. First, the 10-year Treasury is a baseline against which the risk of other investments is assessed.
Treasury rates also affect interest rates for other types of consumer debt, like real estate and mortgage loans. Consumers often compare the return they could earn on Treasurys to certificates of deposit, money market accounts, corporate bonds and even mortgage-backed securities. So when yields for 10-year T-notes go up, so too do rates for real estate and mortgage debt.
Finally, supply and demand for Treasurys fluctuate with the economic climate. When markets or world events turn tumultuous, investors tend to flock to Treasurys in search of a safe haven. When times are good, though, investors tend to seek out other investments that can provide a more favorable return.
Are 10-year Treasury notes a good investment?
Whether 10-year Treasurys are a good investment for you depends on your investment goal. If your goal is to let your money grow slowly and conservatively over time, Treasury notes are considered a low-risk investment if held to maturity since they’re backed by the U.S. government.
One of the main risks with Treasury notes is what’s known as “opportunity cost”: You could forgo potential profits by investing in T-notes instead of a security with a higher potential return.
What is the 10-year treasury yield today?
Here is today’s 10-year Treasury note yield, alongside other Treasury securities for reference.
Rates are sourced from Google Finance and may be delayed. Data is solely for informational purposes, not for trading.
How do you buy 10-year Treasury notes?
Treasury notes can be bought in increments of $100 directly from the U.S. government via TreasuryDirect, or through a bank or broker. T-notes can also be purchased bundled together in the form of a Treasury exchange-traded fund.
Do you pay tax on T-notes?
Investors pay federal income taxes but no state or local taxes on T-notes and other Treasurys.
Below-median family income households are overcoming constraints related to increased borrowing costs and home prices and are finding ways to become homeowners, according to Freddie Mac’s latest economic, housing and mortgage outlook.
The below-median family income homeownership rate increased to 53% from 48% since 2016, Freddie Mac said, citing data from the Census Bureau’s Housing Vacancy survey. In turn, the below-median family income homeownership rate drove the overall increase in the total homeownership rate during that time.
The homeownership rate for owner-occupied households with a family income higher than the median family income grew at a much slower pace than the below-median family income homeownership rate.
Since the second quarter of 2016, the below-median family income homeownership rate has increased 5.4 percentage points, while the above-median family income homeownership rate has only increased 0.8 percentage points, according to the Census Bureau’s data.
The homeownership rate gap between above-median and below-median family income households has also shrunk over the last couple of years, and has generally been trending down over the past decade. This is due to the growth in the below-median family income homeownership rate continuing to outpace the above median family income homeownership rate growth, according to Freddie Mac.
“Below-median family income households are overcoming constraints and finding ways to become homeowners even within a less affordable environment – an encouraging sign as we continue to celebrate National Homeownership Month,” the agency said.
In terms of home prices, the government-sponsored enterprise (GSE) expects them to fall by 2.9% over 12 months through the first quarter of next year, and is expecting an additional decline of 1.3% over the subsequent 12 months.
Mortgage origination volume will likely increase in the second quarter of this year due to seasonality in the housing market, but origination volume for 2023 will almost certainly be below 2022 levels, the GSE said.
Purchase originations are projected to stay flat before strengthening later this year as home sales stabilize, according to Freddie Mac. It will take until 2024 for purchase originations to resume modest growth, the GSE noted.
Freddie Mac’s projections are in line with the recent Mortgage Bankers Association’s (MBA) forecasts.
According to the MBA, the median price of existing homes is expected to decline 4.2%, dropping to $367,800 in 2023 from $384,000 in 2022. In 2024, the MBA expects the median price of existing homes to fall an additional 2.1% to $375,400.
Purchase originations are projected by the MBA to increase to 3.9 million loans in volume in 2024 from 3.2 million in 2023.
If you already have a semester or two of college under your belt, you might be asking yourself, “How much do I owe in student loans?” It’s hard to keep track of your student loan balance, especially since the pause on federal student loan payments has been in effect since March 2020. But with that pause expected to end in the summer of 2023, it’s important to know what you owe.
The amount might startle you. One year after leaving school, graduates have an average of $33,500 in student loan debt, according to the most recent numbers from EducationData.org.
The sooner you find out your student loan amounts, the sooner you could make a plan to pay them off. Here’s how to check your student loan balance.
How to Find Out How Much You Owe in Federal Student Loans
Federal student loans typically come in two types: unsubsidized loans and subsidized loans. If you’re a graduate student, you might also have a Graduate PLUS federal student loan. So then, how to check a student loan balance? Fortunately, information on all your federal student loans can be found in one spot. You can look up your balance on the Federal Student Aid (FSA) website.
To check your student loan balance, simply log into your account at studentaid.gov with your FSA ID and password. There, you’ll find your current student loan balance, the interest that has accrued on your account, payment status, and your loan servicer. If your loan servicer has changed, that information will be there as well.
How to Find Out How Much You Owe in Private Student Loans
There’s no one central website to check your balance for private student loans. One method to figure out how much you owe in private loans would be to contact each loan servicer individually.
If your loans have new servicers and you’re having trouble tracking them down, call your original lenders and ask who the new servicers are. Your school’s financial aid office should also have this information.
Another way to find your loan servicers is to check your credit report. You can get a free copy of your credit report from the three main credit bureaus (Equifax, Experian, and TransUnion) and also from AnnualCreditReport.com.
Your report will list your student loans, the loan servicers, and how much you borrowed. From there you can call each server to find out how much you currently owe. Keep in mind, private student loan providers set their own terms, including loan term length, interest rates, and repayment plans.
It might be a good idea to organize your private student loans and determine when the repayment phase kicks in for each, as it could be different from the federal student loan repayment plan.
Keeping Student Loan Debt Manageable
If this is your first time looking up how much you owe in student loans, you might be feeling major sticker shock. Take a deep breath. Keeping track of student loans can be a big undertaking, so don’t panic.
One way to help manage your student loan debt while you’re in college is to get a part-time job. You could look for opportunities to become a paid tutor, intern, or residence assistant. If working part-time during school isn’t possible, you could plan on getting a full-time job in the summer and live off the savings throughout the school year.
In addition to picking up paying jobs, you could also explore scholarships. These help pay for your education and you don’t have to pay them back. All it takes is some dedicated time looking for the right match. You could check with your university and any organizations you’re involved with to see if you can help fund your tuition this way.
Paying Off Your Student Loans
Once you’ve learned how to check your student loan balance and then determined how much you owe, it’s time to develop a master plan to pay your loans off. This is important, especially since the median monthly student loan payment is $250, according to EducationDate.org, which is no small change.
These are some of the ways you could pay off what you owe.
Use our Student Loan Payoff Calculator to get an idea of when your loan payoff date will be.
Using a Government Repayment Plan
If you have federal student loans, you’ll likely repay your loans using a government repayment plan. This includes income-driven repayment plans where the minimum payment is based upon factors like your income and family size, and the repayment term can be stretched out to 25 years in some cases.
One downside of these options is that they typically increase the total amount you pay back when compared to the standard 10-year repayment plan.
You could also look into Public Service Loan Forgiveness (PSLF), as long as you meet the requirements. To qualify, you must work for a government agency or certain types of nonprofit organizations.
Making an Extra Payment Each Month
If you want to pay off your student loans more quickly, there are a few ways to go about it. First, you could make extra payments. You want to make sure the bulk of your extra payment goes toward your principal, not the interest, so it might make sense to contact your servicers or lenders to let them know if you want to do that.
It will be helpful to see all of your expenses and income together to determine how much extra cash you can put toward your loans. Drawing up a budget can help you determine how much extra money you can put toward your student loan balance.
DIY Student Loan Debt Payoff Ideas
You could organize your student loan debt by either the highest interest rate or by the lowest total outstanding balance. These methods are commonly referred to as the debt avalanche and debt snowball, respectively.
Paying off the debt with the highest interest rate could help save you money in the long-run, whereas paying off the smallest loan balance could give you a quick win.
Once you select a method, you might want to make sure you’re actually making a dent in the balance. One way to do that is to regularly check your balances and see what kind of progress you’ve made. If that method isn’t decreasing your student loan debt as quickly as you’d like, you could switch to a different one.
Refinancing Your Student Loans
Alternatively, you may want to work on ways to reduce your student loan payments. In that case, you could explore student loan refinancing.
When you refinance with a private lender, you replace your old loans with a new private loan, ideally one with a lower interest rate and better terms. Using a student loan refinance calculator can help you figure out how much you might save by doing this.
Once you know the potential savings involved, consider this critical question: Should you refinance your student loans? If it could save you money, refinancing might be worth pursuing. However, it’s important to know that if you refinance federal student loans, they will no longer be eligible for federal deferment or forbearance, loan forgiveness programs, or income-driven repayment. If you’re certain you won’t need access to these programs, refinancing may make sense.
Still not sure? This student loan refinancing guide is full of useful information that could help you decide whether refinancing is the right choice.
SoFi Student Loan Refinancing
If you decide to move ahead, student loan refinancing with SoFi could help lower your monthly payments, shorten your student loan term, or save you money on interest. You can choose low fixed or variable rates, and there are no fees. Plus, you can prequalify and get your rate in just two minutes.
Ready to refinance your student loans? Get started with SoFi.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners. Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances. External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
SoFi Student Loan Refinance If you are looking to refinance federal student loans, please be aware that the White House has announced up to $20,000 of student loan forgiveness for Pell Grant recipients and $10,000 for qualifying borrowers whose student loans are federally held. Additionally, the federal student loan payment pause and interest holiday has been extended beyond December 31, 2022. Please carefully consider these changes before refinancing federally held loans with SoFi, since the amount or portion of your federal student debt that you refinance will no longer qualify for the federal loan payment suspension, interest waiver, or any other current or future benefits applicable to federal loans. If you qualify for federal student loan forgiveness and still wish to refinance, leave unrefinanced the amount you expect to be forgiven to receive your federal benefit.
CLICK HERE for more information.
Notice: SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income-Driven Repayment plans, including Income-Contingent Repayment or PAYE. SoFi always recommends that you consult a qualified financial advisor to discuss what is best for your unique situation.
SoFi Loan Products SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
According to the FTC, Americans have lost $610 million to “income illusions” since 2016 – and $150 million of that was in the first nine months of 2020 alone.
Predatory get-rich-quick schemes have become so audacious, so prevalent that the federal government has launched a full-scale operation targeting them: Operation Income Illusion.
So what are all the modern scams and schemes that young people should look out for? How can you spot the especially sneaky ones? What are the early warning signs of a bad online business course or a phony job listing?
And how can you convince that one relative of yours that they’re in an MLM?
Let’s cover this and more as we explore modern get-rich-quick schemes (and how to spot them).
What’s Ahead:
Common signs of a get-rich-quick scheme
Before we get into specifics, it’s worth pointing out some of the most common signs of any get-rich-quick scheme:
A promise or guarantee of income.
Payment requested upfront to cover supplies/training/application fees.
Sketchy websites or email addresses.
Zero online reviews or ratings.
Hyperbolic marketing language (achieve your dreams, become your own boss, etc.).
The perfect opportunity somehow found you (instead of the other way around).
A request for sensitive info: credit card info, SSN, or a photo of your passport/ID.
They give you a bad gut feeling. When you have a bad gut feeling about a person in real life, you walk away. Do the same online.
1. Cryptocurrency
Ah, crypto.
Perhaps no other investment in history has produced as much FOMO as Bitcoin. After all, everybody knows of somebody who got rich off of it, or alternatively, some rare altcoin (read: any crypto that isn’t Bitcoin) that exploded overnight.
It would be an overreach to call cryptocurrency a scam, but it’s certainly not the investor gravy train it’s made out to be.
Read more: The Top 10 Things You Need To Know About Bitcoin
What they promise
A $10,000 investment in Bitcoin in 2017 became $640,000 just four years later. Invest your money and buckle up, because you’re about to get rich.
Or, alternatively, keep your eyes on the crypto forums. If you get in on the ground floor of a new crypto before it explodes, that’s another easy way to 100x your investment overnight.
What really happens
A $10,000 investment in Bitcoin in November, 2021 would be worth $6,175.36 in February 2022.
Cryptocurrency values are 100% speculation, upheld by investor demand alone. There’s simply no guarantee (or even near-guarantee) that your investment will grow in value in the short- or long-term.
That’s especially true of new or obscure “altcoins” that trade for pennies a pop. Sure, a small percentage of them may blow up – but many more are simply scams or pump-and-dump schemes – and it’s extremely difficult to detect which is which.
Read more: From High Risk To High Cost: Why You Shouldn’t Buy Bitcoin
How to spot a crypto scam
Any crypto that promises to multiply in value is a scam. Again, the only thing propping up crypto values is investor interest, which is fickle, fleeting, and unpredictable.
Bitcoin, Ethereum, and other bonafide cryptos aren’t scams, but they’re ultra-risky investments nonetheless. For more on why, check out Crypto Crash Course – Everything You Need To Know About Bitcoin, Blockchain, And More.
2. Multi-level marketing schemes
MLMs are notorious for using psychology and manipulation to lure unsuspecting income-seekers into their midst. Then, they squeeze capital out of them on the dangling promise of eventually multiplying their returns.
Now that John Oliver and others have shone a light on the industry, the MLMs have had to get even sneakier.
What they promise
Join [Herbalife, Amway, Infinitus] and you’ll become your own boss, get free training, and earn six figures in your first year!
Who doesn’t want to become their own CEO for a small initial investment of just $150, especially when you can make 1000x within 10 months!
What really happens
99% of MLM participants lose money, according to the Consumer Awareness Institute. Anyone appearing like they’re making money from an MLM on social media is simply trying to dupe others into distributing for them.
How to spot an MLM scheme
If you’re wondering whether the sales opportunity you’re considering is part of an MLM, or you’re trying to convince someone that they’re in an MLM, here are a few steps that you can take:
See if it’s already a known MLM. TitleMax (of all places) published a helpful list of the top 25 MLMs by revenue. If your future “employer” is on the list, take a hard pass.
Search for complaints about the company. Reddit, The Better Business Bureau, and your state Attorney General’s office website are all helpful places to find consumer ratings, reviews, and official complaints.
Vet the products. MLMs tend to sell sketchy products with dubious or unsubstantiated research proving their efficacy. If you wouldn’t buy the product, you definitely shouldn’t sell it.
ID the “startup fee”. If a company has a flat fee for upfront training or especially your first round of inventory, it’s most likely an MLM.
Get a second opinion. Ask the company to provide all of its contracts and legal documents, and have a friend, mentor, or your attorney look over everything with a skeptical eye. Don’t try to convince them it’s legit; ask them to convince you that it’s an MLM.
3. The lottery
There’s no more open and honest get-rich-quick scheme than the lottery!
Playing the lotto in tiny doses can be fun when you expect to lose. My better half and I buy a ticket or two per year and fantasize about how we’ll fill our 20-car garage.
Then we lose and laugh.
But playing the lottery with even the faintest expectation that your investment will eventually pay off is a slippery slope – both financially and psychologically.
Read more: Why You Should Never Play The Lottery – And How To Better Spend Your Money
What they promise
Whether it’s $10,000 or $10,000,000, you’re just a scratch away from winning life-changing money.
What really happens
It’s better to gamble your money in Vegas than to play the lottery.
I say that because generally speaking, you have a 5% to 30% chance of beating the house in a Vegas casino (WSJ). Your chances of winning the lottery are 1 in 300 million (CNBC).
But what about a non-jackpot? Can you profit from buying scratch-offs?
“Scratchies” typically list their odds of winning on the back of a card, usually between 5% and 20%. Your chances of winning something are better – but your chances of profiting are still extremely low.
Lotteries are also inherently problematic and controversial. Supporters say they benefit society by generating tax revenue – but it’s worth considering where that revenue is originating.
A mass study on the lottery’s net impact on society found that “the percentage of income spent on the lottery is significantly higher for players with low family incomes and low education,” hence the lottery’s ignominious nickname: “a tax on the poor.”
While it may be more transparent, make no mistake – the lottery is just as bad of a get-rich-quick scheme as an MLM (just with much worse odds).
4. Phony job listings
This one’s more of a straight-up scam than a scheme – and even as far as scams go, it’s pretty nefarious. FBI Special Agent, Jeanette Harper writes:
“Fake Job Scams have existed for a long time but technology has made this scam easier and more lucrative.”
What they promise
A supposed rep from a legit-looking company – or even one pretending to be from a company you’ve heard of – will reach out and say they’re hiring for a high-salary role.
They either say “no experience necessary” or that you’d be perfect for it, and since they want to fill the role right away, they’ll just do the interview via a chat window.
Before your start date for your high-salary role, they’ll need to add you to payroll and benefits – so you’ll need to pass along your W-9, 1099, and/or a scan of your ID.
What really happens
The scammer uses this sensitive information to steal your money and/or identity.
How to spot a phony job listing
Fake job opportunities are pretty insidious, but at least they’re pretty easy to spot. Here are some of the telltale signs:
The job listing appeared on social media (nearly all legit companies recruit via job boards, LinkedIn, or by referral only).
The rep’s email address doesn’t match the company name.
The company has no website/social media/LinkedIn presence (or a sketchy one).
The rep won’t reveal themselves – they won’t share their own personal data nor will they get on a video call with you – they insist on communicating via chat.
Everything they’re telling you seems oddly vague.
The interview process is moving oddly quickly – you’re accepted in minutes or hours, when the real-world process takes days or weeks.
The rep wants money – such as a $25 fee to submit your application.
5. COVID-era robocall scams
At the risk of sounding indelicate, the COVID-19 pandemic has created a target-rich environment for robocallers who peddle MLMs, phony jobs, or shady website building services.
To give an example, the FTC is going after scam company National Web Design for sending out millions of illegal robocalls specifically targeting people who’d just lost their jobs, guaranteeing them passive income if they just paid a little upfront.
I try not to use the term evil lightly…
What they promise
Here’s what National Web Design told its victims: you could earn up to $400 a day as an Amazon affiliate. Just let us build your site for $2,000 and your passive income awaits.
What really happens
The scammers may actually deliver a product, but it never works as advertised. You’re out $2,000 and they never pick up the phone.
How to spot a robocall scam
If someone calls you offering a job or passive income opportunity, it’s a scam. But don’t just hang up – report their call as spam on your phone and report the company to the FTC using this form.
BONUS: how to prevent robocalls in the first place
You can help stem the flow of robocalls to your own phone by adding your number to the official Do Not Call Registry. Don’t worry, it’s free and 100% legit.
The second thing you can do is to never, ever, ever give your phone to a business unless it’s essential to your wellbeing. Even companies that claim to “protect your privacy” will still sell your data to their partners (since it’s not a violation of their own privacy policy).
6. Bad online business courses
Here’s one that I fell for.
To my credit, it wasn’t named so blatantly – and I can tell that the instructor was being sincere in his advice – but it was still bad advice that I paid an embarrassing amount of money for.
Bad online courses always seem like good investments upfront. They’re taught by people who’ve “made it” in the industry and who promise to tell you all of their “best money-making secrets.”
They’re also sold to you at a weirdly high discount (e.g. 97% off) and sometimes, you even have to apply to be in the course.
But crappy online courses aren’t just dangerous due to high cost and missed expectations – they can teach you the wrong things that actually hinder your progress and take months to unlearn.
What they promise
Sellers of “How To Get Rich In XYZ Industry” courses promise exactly that – that you can make millions in a certain industry by simply following in the instructor’s footsteps.
What really happens
The advice you learn in an unaccredited online course can range from good to bad to downright toxic. And if you’re new to an industry, it can be hard to distinguish which is which.
You could be paying for advice that could win new clients – or immediately turn them off.
That’s why you’ll want to be extremely careful who you learn from. Some instructors truly are at the top of their industry and their tips are worth their weight in gold.
But others are on their way out – their way of doing things in their industry no longer works, so they’re packaging and selling bad and outdated advice to make up for lost income.
How to spot a bad online course
Part of the challenge to spotting bad online business courses is that they’re often marketed exceedingly well – so well, in fact, that if it’s a course in How To Make Millions Selling Bad Online Courses, maybe it’s worth it!
Facetiousness aside, here are some of the signs that the course you’re considering isn’t worth it:
The instructor has limited, outdated, or vague experience – e.g. they’ve “worked with dozens of Fortune 500 companies” but won’t say who, in what capacity, or how much they actually earned.
The course promises or downright guarantees income. No course can guarantee income, so that’s a huge red flag.
High-pressure sales tactics. If the vendor of an online business course gives you a short time window to decide, or says the price will increase in 13 hours, just shrug and hang up the phone.
No reviews or ratings. If the instructor can’t point to a single successful past student, that’s probably a sign that one doesn’t exist – and you won’t be the first.
A high price tag. Finally, if a 3-day “Mastermind” costs thousands of dollars, that could be a sign that the instructor values his or her advice. It could also mean that they need the money because their clients dried up.
7. Mystery shopper scams
Mystery shopping is when a restaurant, retailer, or third-party data company will hire you to go into a store or restaurant and report back on your experience. Mystery shoppers are often paid a flat fee per assignment, and sometimes even get the product/meal reimbursed, too.
From what I’ve heard, it’s a fun gig if you can get it. But since lots of folks are interested, the scammers are taking advantage.
What they promise
Mystery shopping scams often start with a text stating that you can earn $200 to $500 per assignment by becoming a secret/mystery shopper or “filling out a survey.”
All you have to do is visit a retail store, purchase a product or a gift card, send it to a specific address, and report on your experience. You’ll be compensated upon completion. Easy $500.
This may sound like an obvious scam, but in the victims’ defense, this isn’t too far removed from how legit mystery shopping works.
What really happens
In the case of the scam, you send the product or gift card and are never compensated. To rub salt on the wound, the scammer may sell or abuse the personal data you gave them.
How to spot a mystery shopping scam
Luckily, the Mystery Shopping Professional Association (MSPA) publishes a running list of all the mystery shopping scams they’ve seen.
If you don’t see the potential scam listed there, cross-reference it with their free online directory of legitimate mystery shopping companies.
Summary
To a pandemic-stricken society, get-rich-quick schemes are becoming harder to spot and more seductive all at once.
But by helping yourself and your loved ones avoid them, you can protect your money and ride out the storm.
Massachusetts has the highest percentage of adults with a bachelor’s degree or higher in the country — outside of Washington, D.C. — and it’s home to elite schools like Boston College, Harvard University, Massachusetts Institute of Technology and Tufts University.
Massachusetts may have some of the most expensive colleges in the country. But the commonwealth offers more financial aid options than many other states, including valuable tuition waivers, grants and scholarships.
The cost of education in Massachusetts
The Massachusetts public higher education system consists of 15 community colleges, nine state universities and five University of Massachusetts campuses. Students can also attend more than 90 private schools within its borders.
Here’s how much you can expect to pay for a year of tuition, required fees and room and board as a full-time undergraduate student in Massachusetts, based on 2020-21 average rates as reported by the National Center for Education Statistics:
Public four-year school (in-state): $28,317, about $6,980 higher than the national average.
Private four-year school: $65,784, about $19,471 higher than the national average.
Community college (in-state): $5,529, about $2,028 higher than the national average.
Financial aid options in Massachusetts
In Massachusetts, the cost of a public university for an in-state student is less than half the cost of attending a private school. But to qualify for the lower, in-state rate, you must be a qualifying resident.
To qualify for in-state rates in Massachusetts, you must live in the state for at least 12 months prior to enrollment. If you’re applying to a community college, you have to live in the state for six months before enrollment.
You may be asked for documentation or proof of residency. Eligible documents include:
Federal and state income tax returns.
Employment pay stubs.
A Massachusetts high school diploma.
Deferred Action for Childhood Arrivals (DACA) students can qualify for in-state tuition if they meet the residency requirements. However, they aren’t eligible for other state-based aid, such as grants or scholarships.
Undocumented students without DACA status aren’t eligible for in-state tuition or state-based aid.
Residents may be able to use one or more of the following state financial aid programs to offset the cost of education:
529 plans.
Scholarships.
Tuition waivers.
Student loan repayment assistance.
529 plans
For families who want to help their children pay for school, a 529 plan can be an excellent tool.
Massachusetts has two options:
U.Fund College Investing Plan
U.Fund College Investing Plan is a 529 investment plan in Massachusetts run by Fidelity. It allows you to invest and potentially grow your contributions to pay for a child’s education. There is no minimum to get started, and contributions are deductible on your Massachusetts income tax return. You can deduct up to $1,000 each year if you’re single, or up to $2,000 if you’re married and file a joint return.
Massachusetts also operates the Baby Steps program for children born or adopted in the state. If you open a U.Fund College Investing Plan account within one year of your child’s birth or adoption, the state will deposit $50 into the 529 to jump-start your savings.
U.Plan Prepaid Tuition Program
U.Plan Prepaid Tuition Program is Massachusetts’s prepaid tuition plan. It allows you to buy college credits at today’s rates, and your child can redeem them at participating Massachusetts colleges and universities in the future.
This plan has another perk: if your child chooses a school that doesn’t participate in the U.Plan program, you can cash out the fund and receive all of the contributions plus interest based on the consumer price index. There are no federal or Massachusetts tax consequences to cashing out the account.
In-state tuition
Massachusetts has some top public colleges and universities, and they’re about half the cost of private schools. However, Massachusetts is also part of the New England Regional Student Program (RSP), which allows Massachusetts residents to enroll at out-of-state New England public colleges and universities at a discount.
More than 2,500 undergraduate and graduate programs are part of the network. Eligible institutions are in Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont.
Massachusetts grants
Grants, a form of gift aid, are typically issued based on financial need. Massachusetts offers seven state-operated grant programs.
Foster Child Grant Program
For current or former foster children, the Foster Child Grant Program provides up to $6,000 in annual grant funds. You must be between 18 and 25 at the start of study to qualify, and you can receive the award to attend a public or private school in Massachusetts for up to five consecutive years.
MASSGrant and MASSGrant Plus
The MASSGrant and MASSGrant Plus programs are for undergraduates with unmet financial need. Award amounts are based on the student’s household income but can cover the student’s remaining tuition and mandatory fees. However, these programs won’t pay for room and board. MASSGrant Plus may cover other expenses, such as textbooks or school-required fees.
Massachusetts Gilbert Matching Student Grant Program
The Massachusetts Gilbert Matching Student Grant Program provides funding to private schools to give grants to students. Eligible undergraduate students can receive from $200 to $2,500 per academic year, but the funds can only be used at participating private schools within the state.
Cash Grant Program
The Cash Grant Program is a complementary program to the Massachusetts Need-Based Tuition Waiver Program (see below). It provides students with grant money to pay for additional education-related expenses, such as mandatory school fees, at eligible public colleges and universities.
Part-Time Grant Program
Part-time students at public or private schools who are Massachusetts residents for at least one year prior to the start of study may qualify for the Part-Time Grant Program. Award amounts vary, but the minimum amount is $200.
Public Service Grant Program
For children or spouses of individuals killed or missing during their work as public duty servants in Massachusetts, the Public Service Grant Program covers up to the total cost of tuition at qualifying schools.
Paraprofessional Teacher Preparation Grant Program
Residents employed for at least two years as paraprofessionals in Massachusetts who wish to become certified teachers can take advantage of the Paraprofessionals Teacher Preparation Grant Program. It provides up to $7,500 per academic year for programs leading to a Massachusetts teaching certification.
Massachusetts scholarships
Massachusetts has several scholarships for students who display exceptional academic achievements or who have overcome significant personal obstacles. Depending on the award, eligible students can receive scholarships that cover up to 100% of the tuition cost. There are seven state-operated scholarship programs:
Agnes M. Lindsay Scholarship Program
The Agnes M. Lindsay Scholarship Program is for students attending public universities in Massachusetts. Students must have a demonstrated financial need and be a permanent resident of a rural area with fewer than 15,000 inhabitants. Award amounts vary by year.
Christian A. Herter Memorial Scholarship Program
Students who qualify for the Christian A. Herter Memorial Scholarship Program will receive an award that covers up to half of their calculated financial need at any university in the continental U.S. The scholarship is for Massachusetts residents who have overcome difficult personal circumstances, such as poverty, abuse or illness. Students must be nominated in the 10th or 11th grade by a school or qualified community agency or organization.
Early Childhood Educators Scholarship Program
To increase the number and quality of teachers and care providers, Massachusetts created the Early Childhood Educators Scholarship Program. Students pursuing degrees in early childhood education or related fields at select universities may be eligible for up to $4,500 per semester. Awardees must commit to working in an eligible program for at least one year.
Massachusetts High Demand Scholarship Program
The Massachusetts High Demand Scholarship Program is for students pursuing degrees in high-demand disciplines that will help address the state’s workforce needs. Eligible students attending a Massachusetts public university can receive up to $6,500 per year. Students can apply by completing a separate application through the MASSAid portal.
John and Abigail Adams Scholarship
The John and Abigail Adams Scholarship provides students with a credit that can pay for up to eight semesters of undergraduate education at a state college or university. The scholarship is awarded based on the student’s performance on the 10th grade Massachusetts Comprehensive Assessment System (MCAS) test.
One Family Scholarship Program
Low-income, head-of-household parents who are at risk of homelessness or who have experienced homelessness within the past year may be eligible for the One Family Scholarship Program. Award amounts vary, but it can cover tuition and living expenses for eligible students pursuing a degree at a Massachusetts school.
Paul Tsongas Scholarship
The Paul Tsongas Scholarship is awarded to students with high scores on the SAT or ACT and a GPA of 3.75 or higher. Eligible students can qualify for a waiver of mandatory tuition and fees at a state university.
Tuition waivers in Massachusetts
In addition to scholarships and grants, Massachusetts operates several tuition waiver programs. Depending on the program, you could qualify for a full or partial waiver of your tuition costs.
Career Advancement Program Tuition Waiver
Public school teachers within the first three years of teaching may be eligible for the Career Advancement Program Tuition Waiver. It waives the cost of one graduate-level course per year for up to three years.
Categorical Tuition Waiver
Veterans, Native Americans, senior citizens (over 60), members of the U.S. armed forces, and clients of the Massachusetts Rehabilitation Commission or the Commission for the Blind can qualify for the Categorical Tuition Waiver. It waives the full cost of tuition at public colleges and universities within the state.
Collaborative Teachers Tuition Waiver
The Collaborative Teachers Tuition Waiver encourages teachers to become mentors to full-time student teachers from public colleges and universities. The program waives the cost of one graduate-level course at a public school for each mentoring teacher.
Department of Children and Families (DCF) Foster Child Tuition Waiver and Fee Assistance Program
Graduate Tuition Waiver
To encourage students to enroll in graduate school, the state created the Graduate Tuition Waiver program. The waiver’s value varies by year, but it can be used for tuition at public schools like the University of Massachusetts.
High Technology Scholar/Intern Tuition Waiver
Incentive Program for Aspiring Teachers Tuition Waiver
MassTransfer Tuition Waiver Program
The MassTransfer Tuition Waiver Program is for students who earned an associate degree at a Massachusetts community college and are transferring to a participating public school. It waives the cost of tuition for up to two years.
Massachusetts Educational Financing Authority (MEFA) Prepaid Tuition Waiver Program
Need-Based Tuition Waiver Program
Commonwealth September 11, 2001 Tragedy Tuition Waiver
Children or spouses of those who died or went missing due to terrorism on Sept. 11, 2001, can qualify for this waiver, which covers up to 100% of tuition at a state school.
Stanley Z. Koplik Certificate of Mastery Tuition Waiver
UMass Exchange Tuition Waiver
The UMass Exchange Tuition Waiver allows University of Massachusetts students to attend partner institutions without a tuition charge. Eligibility varies by school.
Valedictorian Program Tuition Waiver
Students who were valedictorians of their Massachusetts high school may qualify for the Valedictorian Program Tuition Waiver. If eligible, the full cost of tuition at public schools is waived.
Washington Center Program Tuition Waiver
Through the Washington Center Program Tuition Waiver, students at Massachusetts public colleges and universities are placed in internships in government offices, communication organizations, law firms and professional associations. Students can also qualify for a waiver of mandatory school fees and receive a $2,000 housing scholarship.
MEFA was created by the Massachusetts state legislature to offer low-cost college financing to families. It issues student loans to college students nationwide, and it also offers student loan refinancing.
For undergraduate students, repayment terms are 10 or 15 years. All loans have a fixed interest rate starting at 4.89%, and there are no origination fees.
For graduate or professional students, the repayment term is 15 years. Rates are fixed and start at 5.74%.
Eligibility is based on your credit score, income and whether you have a co-signer.
Massachusetts No Interest Loan Program
While anyone can apply for a MEFA loan, the Massachusetts No Interest Loan Program is more limited. It is a state-funded loan program that issues loans with 0% interest and 10-year repayment terms. Eligible students can borrow from $1,000 to $4,000 per academic year, with a lifetime maximum of $20,000.
It’s only available to Massachusetts residents of at least one year who are U.S. citizens or permanent residents. Eligibility is based on financial need as determined by the Free Application for Federal Student Aid (FAFSA).
Other financial aid programs in Massachusetts
Students can also qualify for up to $250 each semester to pay for other expenses, such as transportation or textbooks.
Student loan repayment programs in Massachusetts
The average student loan balance per borrower in Massachusetts is $33,710, according to a NerdWallet analysis of 2022 Federal Student Aid Office data. If you are a Massachusetts resident with outstanding student loans, you may be eligible for help with your debt through the following state loan repayment program:
Massachusetts Loan Repayment Program for Health Professionals
Primary health care professionals, in areas including dental, medical and mental health, who commit to work for at least two years full time (or the part-time equivalent) in an eligible facility in a high-need area can qualify for up to $50,000 in student loan repayment assistance.
How to apply for financial aid in Massachusetts
To apply for Massachusetts financial aid programs, complete these steps:
Submit the FAFSA. Many of the state’s programs are awarded based on your financial need. Your need is determined by the information you submit on the FAFSA, so submit it ahead of the May 1 state deadline for priority consideration.
Create a MASSAid account. You can create an account through the MASSAid portal.
Complete a separate application. Some programs have their own applications. For example, the Christian A. Herter Memorial Scholarship Program has a separate application through MASSAid for nominators to fill out. Review the award requirements and fill out any necessary forms to apply.
If you have questions about state-based aid or how to apply for different programs, contact Massachusetts’ Office of Student Financial Assistance (OSFA) at 617-391-6070 or by visiting the OSFA website.
With mortgage rates currently at 7.04%, many first-time homebuyers – typically millennials – will be forced to continue to rent.
But the U.S. housing market is not a monolith, so today we’re going to look at some markets where affordability is within the normal renter’s reach.
In a study published this week, First American economist Ksenia Potapov analyzed the share of homes that are affordable to the median renter in any given market. She defined an affordable market as one in which the median renter can afford 50% or more of the homes for sale based on the renter’s household income, the prevailing 30-year mortgage rate, and the assumption that one-third of pre-tax income is used for a mortgage with a 5% down payment.
Here’s what she found:
There are only four markets in the U.S. in which the median renter in that market could afford half or more of the homes – Buffalo (59%), Pittsburgh (56%), Detroit (54%) and Cleveland (54%).
Meanwhile, the least affordable markets were Los Angeles (1%), San Diego (2%), San Francisco (2%), Salt Lake City (4%), and San Jose, Calif. (4%). The California cities are stalwarts on lists such as these, but Salt Lake City — which attracted tech workers during the pandemic — is a new entrant.
“Pre-pandemic, Salt Lake City was an affordable market that fell in the middle of the pack out of the top 50 U.S. markets,” Potapov wrote. “However, rapid house price appreciation during the pandemic dragged Salt Lake City near the bottom of the affordability list. In the fourth quarter of 2019, the median renter could afford 69% of the homes for sale in Salt Lake City. Now, the median renter can only afford 4% of homes.”
According to data from Altos Research, the median home price listed in Salt Lake City last week climbed to $785,000, up from about $540,000 in the fourth quarter of 2019.
Jake from State Farm to California: Drop dead!
California markets like the ones listed above already face a number of challenges, but news over the weekend could make it even more challenging for buyers. Last week we talked about the cost of flood insurance going up by over 200% for some homeowners in the Southeast as both the federal government and private insurers determine how to price the soaring cost of climate risk, or abandon insuring them altogether.
Well, State Farm last week announced that it would halt home insurance sales in California. State Farm is the nation’s largest car and home insurer by premium volume. The insurance giant said it “made this decision due to historic increases in construction costs outpacing inflation, rapidly growing catastrophe exposure, and a challenging reinsurance market.” Existing home-insurance policyholders won’t be affected, though this is clearly not a positive development for the state.
You might remember that a year ago, AIG notified 9,000 wealthy clients that it wouldn’t renew home insurance policies in California. The change was part of a plan by AIG to stop selling home policies in California through a unit regulated by the state’s insurance department. Policyholders were instead directed to another unit, where policies could cost three-to-five times higher than what clients paid under the old plan, with less-generous coverage to boot.
California has experienced record wildfires in the past six years. The state experienced eight of the largest fires in U.S. history and three of the top five deadliest fires.
I am not sure if we should even get into the reconstruction costs in California, which are so high they are almost beyond belief.
What does this all mean for Californians? For starters, I expect that other insurance companies are going to follow suit and availability is going to be a serious problem for homeowners and prove a problem for buyers and sellers alike. As is true in Florida, California has an insurer of last resort — FAIR Plan — for wildfires, but homeowners will still need significant wrap-around coverage. The premiums are quite high under FAIR, too and they cover the dwelling at actual cash value versus replacement cost value.
Cali LOs and agents: Have you had any deals held up because of home insurance issues? Let me know at [email protected]
In our weeklyDataDigest newsletter, HW Media Managing Editor James Kleimann breaks down the biggest stories in housing through a data lens. Sign up here! Have a subject in mind? Email him at [email protected]
If you have a disability that affects your daily life, you may qualify for government or private funding programs. Whether you want to make your home more accessible, find decently priced health insurance, or start a business, there are financial resources designed for you.
Note: though people with disabilities earn across the income spectrum, some of the resources on this list are reserved for people with low incomes (or people whose disabilities make it tough to find employment). If you earn above a certain threshold, some suggestions here won’t apply to you. Others are available to all people with disabilities, regardless of income.
Unless noted otherwise, the resources in this article are specific to people who live in the United States.
What’s Ahead:
Housing
Public housing programs
Depending on availability where you live, you can get on the list for low-cost public rental housing through the federal office of Housing and Urban Development (HUD). You apply at the local level through your state agency.
Note that there are income limits based on the median income in your area, and typically a long waiting list.
Rental assistance for private housing
It’s also possible — and maybe less of a wait — to qualify for rental assistance on private housing of your choice. This map directs you to available housing and other financial help in your city and state.
Vouchers for renting or buying
HUD’s housing choice voucher program, otherwise known as Section 8, includes people with disabilities in its voucher-eligible pool. Vouchers give you financial help to pay all or part of the rent.
You can pick the home or apartment where you want to live, unlike with public housing assistance. But you’re responsible for finding the place and filling out the application.
The income requirements are similar to those for public housing. If you earn less than 50% of the median income for your area or county, you’re eligible.
Non-elderly disabled (NED) voucher program
This voucher program is designed for people with disabilities who wouldn’t otherwise qualify for housing assistance.
There are a few different kinds of NED vouchers. Some help you pay for rentals on the private market. Others set aside units in certain Section 8 housing developments for applicants with disabilities.
Buying a home
For people ready to buy, housing choice vouchers can help pay the mortgage and other miscellaneous homeownership costs. Note that this voucher program is for first-time homeowners, and not every public housing agency offers it.
Find your public housing agency here to learn their voucher specifics.
Read more: Home affordability calculator
Home repair
Government loans for rural homeowners
The U.S. Department of Agriculture (USDA) has grants and loans for rural homeowners who want to retrofit or modify a home to make it more accessible. Use their map to check if your neighborhood qualifies as “rural.”
Grants are reserved for elderly homeowners, but loans up to $40,000 are open to all qualified applicants (at 1% interest, which you really can’t beat).
Home repair for veterans
If your disability is connected to your time in the military, you may qualify for a government grant to buy or repair your home.
These grants are substantial — over $100,000 for fiscal year 2022.
Private home repair aid
Rebuilding Together is a volunteer organization that completes home upgrades and repairs at no cost to homeowners with disabilities.
The National Directory of Home Modification and Repair Resources has links to several funding opportunities, including local loans and grants.
To search state-by-state for home repair grant assistance, try the Rehabilitation Engineering Society of North America’s Catalyst Project directory.
Education
Grants, scholarships, and loans
There are diverse financial resources for students with disabilities at the undergraduate, graduate, and professional levels. Many are geared towards certain disabilities, but some are more general.
Read more: Money Under 30’s guide to filling out the FAFSA
Federal student loan discharge
Student loan borrowers with total and permanent disabilities can apply to have their federal loans partially or fully discharged. You’ll need some documentation to confirm your disability. (Note that this program only applies to certain federal loans).
Savings
ABLE accounts
Achieving a Better Life Experience (ABLE) accounts are tax-advantaged savings accounts (meaning you don’t pay taxes on income you earn from them).
Designed to meet disability-related expenses, ABLE accounts are less expensive alternatives to most trust funds. You can contribute up to $16,000 a year.
If your disability onset occurred before you turned 26, you may be eligible to open an ABLE account. And if you’re taking advantage of income-contingent programs like housing vouchers or food stamps, ABLE account savings won’t affect your eligibility.
Health insurance
Medicaid
You may already know about Medicaid, but in case you don’t, this low-cost (sometimes free) government-funded healthcare coverage is available to people with disabilities and low incomes. Each state has slightly different Medicaid requirements.
Medicare
Medicare, while also free or low-cost, isn’t attached to income. Younger people with disabilities qualify for Medicare, and they can work while receiving Medicare.
If you’re eligible, you can have both Medicare and Medicaid (depending on your health care needs, the extra coverage may be worthwhile).
Read more: What to do when you get medical bills you can’t afford
Paying for prescriptions
Once you qualify for Medicare, you’re automatically eligible for a range of pharmaceutical savings programs, including Medicare Extra Help and state-based assistance for certain prescriptions.
Other financial resources for medication access include:
Living expenses
Social Security Disability Insurance
Social Security Disability Insurance (SSDI) has pretty strict requirements. You may qualify if your disability makes you unable to work, if it’s designated as a total (not partial or temporary) disability, and if you’ve previously worked long enough to pay Social Security taxes.
Its benefits include monthly financial assistance, at a higher amount than its sister program Supplemental Security Income (SSI).
Supplemental Security Income (SSI)
SSI monthly benefits are easier to qualify for than SSDI. You don’t need to have paid into Social Security, but your income can’t be above a certain amount.
You can have a part-time or full-time job and stay on SSI through their “work incentives” program. The goal is generally to transition participants off SSI once they’ve saved enough cash, but each case is different.
Read more: Why disability insurance is the most important financial product you didn’t realize you needed
Employment
If you’re entrepreneurially-minded, the Small Business Administration has a list of resources — including grants, loans, and professional networks — designed for business owners with disabilities.
People with blindness or significant disabilities can browse the job boards and make connections at AbilityOne.
For people on SSI or SSDI benefits, the Ticket to Work program gives referrals, training, and other employment assistance.
Summary
If you need some help paying bills, relocating, or meeting a savings goal, there’s likely to be a disability-related program that matches your needs.
And if you’re financially independent, it’s still worthwhile to check out your aid options — public and private resources can keep more money in your pocket for the future.
Nursing home care can be extremely expensive. According to Genworth’s 2021 Cost of Care Survey, the median monthly cost of a private room is a nursing home is $9,034. That’s over $100,000 a year! And most people will need nursing home care or something similar in their old age: A study from the Urban Institute and the U.S. Department of Health and Human Services found that 70% of Americans who reach the age of 65 need some long-term care during their remaining years.
But there are ways to get some of these costs covered, as well as strategies that can help cover any out-of-pocket expenses. We’ll examine four ways to pay for nursing home care, some of which you can implement early in your life to ensure a financially secure retirement. Consider working with a financial advisor if you want more personalized retirement and savings advice.
What Government Programs Will Cover
There are three government programs intended to insure and help cover medical costs for Americans ages 65 and older. Let’s take a look at how each of these may be able to help you pay for nursing home care.
Medicare: Medicare typically doesn’t pay for nursing home stays because it doesn’t cover custodial care. Custodial care is defined as “non-skilled personal care, like help with activities of daily living like bathing, dressing, eating, getting in or out of a bed or chair, moving around, and using the bathroom.” Medicare will only cover nursing home care when you need more advanced medical care — like regular injections that can only be administered by a medical professional. Medicare has additional restrictions and limits, and shouldn’t be counted on as a way to pay for long-term care in a nursing home.
Medicaid: Medicaid will cover 100% of your nursing home care so long as you meet the program’s financial eligibility requirements, according to the American Council on Aging. Individuals typically must have a low enough income and few financial resources to qualify for Medicaid. States limit the amount of income you can earn while qualifying for Medicaid and also typically put a $2,000 cap on the amount of cash and other assets you can have (beyond your home’s value). Additionally, the services must be deemed medically necessary by a physician.
PACE: Some states offer a Program of All-Inclusive Care for the Elderly (PACE), which is a joint Medicare-Medicaid program that can help those who need nursing home care. If you’re eligible and there’s a PACE program in your area, you can apply for care.
What Specialized Insurance Will Cover
Long-term care insurance is a fantastic option that can help you pay for nursing home care if you don’t qualify for government programs. This product is intended to cover the exact kind of care that isn’t often covered by Medicare — custodial care — as well as any specialized care or rehabilitation therapy you need.
Long-term care insurance isn’t cheap, but it can be a lot cheaper than paying out of pocket. The American Association for Long-Term Care Insurance found in its 2023 analysis that a 55-year-old man purchasing long-term care insurance with $165,000 in immediate benefits can expect to pay $900 a year. A woman in the same situation can expect to pay between $1,500 and $3,600.
How Tax Deductions Can Help
According to the IRS, you can deduct some or all of your nursing home expenses on your tax return. A tax deduction is a provision that allows some of your income to go untaxed. For instance, if you make $40,000 in income and qualify for a $5,000 tax deduction, you’ll only pay taxes on $35,000 of your income. While these tax provisions won’t necessarily help you pay for nursing home care up front, they can save you money after the fact.
The IRS specifies that if you’re in nursing home care primarily for medical reasons rather than custodial care, you can deduct the total cost. If you’re in nursing home care primarily for non-medical reasons, you can deduct the cost of any medical care, but not the cost of services such as lodging and meals. To figure out your tax deduction amount, most taxpayers will simply need to total up all of their qualifying medical costs, then subtract 7.5% of their adjusted gross income.
How to Cover Out-of-Pocket Costs
Even if you have long-term care insurance or another plan for covering your nursing home care, you will still want to have some money on hand to finance any uncovered expenses or surprise costs. Plan ahead for these out-of-pocket expenses by setting up a tax-advantaged retirement account.
A good option is to open a Roth IRA to use for these costs. Since you fund a Roth IRA with after-tax money, you won’t be taxed when you withdraw the money as long as you have reached age 59 ½ and the account has been open for five years. And unlike a traditional IRA, you won’t be subject to required minimum distributions (RMDs) at a certain age, so that money can remain invested until you need it.
An annuity is another smart way to cover out-of-pocket expenses or anything insurance won’t cover. An annuity is an insurance product where you pay a certain amount in exchange for receiving payments at a later date. You can specify when you want the payments to start, what schedule you want them to follow and how much you want them to be. You can also purchase an annuity with a long-term care rider to help cover some specified conditions requiring medical care.
Bottom Line
Nursing home care is expensive, but there are ways to plan for it and programs that can help you cover the costs. See how much government programs can help you, look into insurance options and make sure to take advantage of medical expense tax deductions.Lastly,set aside some savings for the costs that won’t be covered by government programs or insurance.
Retirement Planning Tips
Consider talking to a financial advisor about your options for preparing for long-term care costs. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three qualified financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
A related concern is how much life insurance you may need. SmartAsset’s life insurance calculator will give you an estimate of how much life insurance you should have.