What Are the Capital Gains Tax Rates for 2021 vs. 2022?

The federal income tax rate that applies to gains from the sale of stocks, mutual funds or other capital assets depends on how long you held the asset and your taxable income. Gains from the sale of capital assets that you held for at least one year, which are considered long-term capital gains, are taxed at either a 0%, 15% or 20% rate.

However, which one of those long-term capital gains rates – 0%, 15% or 20% – applies to you depends on your taxable income. The higher your income, the higher the rate. If you’re working on your 2021 tax return, here are the capital gains taxable income thresholds for the 2021 tax year:

2021 Longer-Term Capital Gains Tax Rate Income Thresholds

Capital Gains
Tax Rate

Taxable Income
(Single)

Taxable Income
(Married Filing Separate)

Taxable Income
(Head of Household)

Taxable Income
(Married Filing Jointly)

0%

Up to $40,400

Up to $40,400

Up to $54,100

Up to $80,800

15%

$40,401 to $445,850

$40,401 to $250,800

$54,101 to $473,750

$80,801 to $501,600

20%

Over $445,850

Over $250,800

Over $473,750

Over $501,600

The income thresholds for the capital gains tax rates are adjusted each year for inflation. To see how the thresholds will change from 2021 to 2022, here are the figures for the 2022 tax year:

2022 Capital Gains Tax Rate Thresholds

Capital Gains
Tax Rate

Taxable Income
(Single)

Taxable Income
(Married Filing Separate)

Taxable Income
(Head of Household)

Taxable Income
(Married Filing Jointly)

0%

Up to $41,675

Up to $41,675

Up to $55,800

Up to $83,350

15%

$41,675 to $459,750

$41,675 to $258,600

$55,800 to $488,500

$83,350 to $517,200

20%

Over $459,750

Over $258,600

Over $488,500

Over $517,200

The tax rate on short-term capitals gains (i.e., from the sale of assets held for less than one year) is the same as the rate you pay on wages and other “ordinary” income. Those rates currently range from 10% to 37%, depending on your taxable income. To see what rate you’ll pay, see What Are the Income Tax Brackets for 2021 vs. 2022?

Surtax on Net Investment Income

There’s an additional 3.8% surtax on net investment income (NII) that you might have to pay on top of the capital gains tax. (NII includes, among other things, taxable interest, dividends, gains, passive rents, annuities, and royalties.) You must pay the surtax if you’re a single or head-of-household taxpayer with modified adjusted gross income (AGI) over $200,000, a married couple filing a joint return with modified AGI over $250,000, or a married person filing a separate return with modified AGI over $125,000. Use Form 8960 to calculate the surtax.

Under the current version of the Build Back Better Act, which is being considered by Congress, the surtax would be expanded to cover NII derived in the ordinary course of a trade or business for joint filers with modified AGI over $500,000, single or head-of-household filers with modified AGI over $400,000, and married people filing a separate return with a modified AGI over $250,000. The proposed legislation would also clarify that the surtax doesn’t apply to wages on which Social Security and Medicare payroll taxes (i.e., FICA taxes) are already imposed. The Build Back Better Act was passed by the House in December, but it has stalled in the Senate.

Source: kiplinger.com

18 Student Loan Mistakes to Avoid

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Additional Resources

Most students have to borrow student loans to go to college. But very few know anything about them. That’s pretty scary considering you’re likely to take on several tens of thousands of dollars in debt. And making mistakes with that much money could cost you just as much. 

Take it from me. I borrowed six figures to get a doctorate to work in a notoriously low-paying field. And thanks to taking advantage of years of deferments, forbearances, and an income-based plan designed to help borrowers with high debt and low income, I now owe twice what I originally borrowed. 

Don’t make my mistakes. Instead, learn about the most common student loan borrowing and repayment errors. That way, you can avoid an overwhelming amount of student loans and get out of debt faster.

Student Loan Mistakes to Avoid

Most student loan borrowing and repayment mistakes deal with misunderstanding what you’re borrowing, how interest works, how to pay off debt quickly, and how to avoid default. Steer clear of these top mistakes to ensure you borrow smartly and don’t end up in over your head. 

Mistake 1: Applying for Aid at the Last Minute

The Free Application for Federal Student Aid (FAFSA) is the gateway to qualifying for all financial aid of any kind. That includes federal grants and student loans as well as state grants and most institutional aid — the grants, scholarships, or loans offered by your school. 

The FAFSA opens for applications every Oct. 1, and you must complete it by June 30 before the academic year you need aid for. You must complete a new FAFSA every year you plan to enroll in school.

Many colleges and universities also require additional forms, such as the CSS profile (short for the College Scholarship Service profile), which dives even deeper into your family’s financial situation. So check with the financial aid office to find out what they are, and stay on top of deadlines. 

But note that states and colleges have limited grant resources. And those resources tend to go to the students who apply early. In other words, they’re first come, first served. So the earlier you get your applications in, the better.

And while the federal government is unlikely to run out of education loan funds, if you miss the FAFSA deadline, you’ll have to resort to private loans, which are costlier and feature less favorable repayment options.

Apply as early as possible to ensure you get as much grant and scholarship aid as you can qualify for. The more grants you can get, the fewer loans you’ll need to borrow.

Mistake 2: Borrowing Too Much

It’s possible to borrow every cent you need to finance your education anywhere you want to go to school. But it’s crucial to ask whether you should. Getting in over your head with student loan debt can have catastrophic consequences. I’m living proof.

I needed a doctorate for my original career plan of teaching college. But few college professors earn enough income to manage the types of monthly payments I had along with other living expenses. That’s how I ended up in the deferment-forbearance cycle.

And it’s not easy to get out of. 

Thanks to a loophole in the Public Service Loan Forgiveness Program I was counting on and how colleges operate, my teaching position doesn’t qualify me for forgiveness. Additionally, discharging student loans in bankruptcy is currently so difficult it’s nearly impossible. And settling federal student loans isn’t any easier. 

The first step to reducing overwhelming student loan debt is to exhaust every other means of paying for college, including scholarships, grants, and work-study. Search online for scholarship aid using a national scholarship database like Fastweb.

And never count on options like the Public Service Loan Forgiveness Program. Historically, the government’s made it nearly impossible to get. Do your homework to increase your chances of getting it and apply for it if you qualify. But don’t base your student loan repayment strategy on it.

Additionally, consider less expensive colleges. State schools tend to give most students the best value. It only matters where you go to college for a select few graduates, such as those looking to build connections with specific financial or law firms. 

Finally, do a cost-benefit analysis. I found out the hard way all degrees don’t pay off, so as much as you want to pursue your passion, it might not be worth it financially.

Search sites like Glassdoor or PayScale to find out how much you can reasonably expect to make in your chosen field and compare that to the cost of school. As a rule, don’t borrow more than you can expect to earn as your annual salary your first year out of school. That ensures you can pay it off in 10 years or less. 

Mistake 3: Not Understanding How Loan Forgiveness Works

Historically, the Public Service Loan Forgiveness Program has been notoriously difficult to qualify for. The program was overhauled in the fall of 2021. But until then, only 2% of applicants who believed they qualified had their loans forgiven.

Much of that is likely due to bureaucratic mismanagement, hence the overhaul. However, the mismanagement led tens of thousands of borrowers into making payments under the wrong repayment programs. 

On Oct. 6, 2021, the government announced Temporary Expanded Public Service Loan Forgiveness, which allows previously nonqualifying payments to be counted toward loan forgiveness as long as those payments are certified before Oct. 31, 2022.

But moving forward, it’s crucial that borrowers are clear about the rules of loan forgiveness. You don’t want to find out after 10 years that your application is ineligible and you have to start all over.

To qualify for loan forgiveness, you must:

  • Have Federal Direct Loans. Private loans don’t qualify for forgiveness, nor do other types of federal loans, such as Perkins loans. If your federal loans aren’t direct loans, you can consolidate them into a direct loan to qualify. 
  • Work Full-Time for the Government or a Nonprofit. Payments only qualify while you’re employed full-time for an American federal, state, local, or tribal government or qualifying 501(c)(3) nonprofit organizations. That includes military service, Peace Corps, and AmeriCorps but excludes labor unions and partisan political organizations.
  • Enroll in an Income-Driven Repayment Program. No other repayment options qualify. But even if your income is so low your calculated payment under the plan is $0, being enrolled qualifies you. 
  • Make 120 Qualifying Payments. They don’t have to be consecutive, but they must qualify, meaning you have to make them under an income-based plan.
  • Submit the Forgiveness Certification Form Regularly. You must fill out and submit a Public Service Loan Forgiveness Program certification form yearly and each time you switch employers. While not required, doing so ensures the payments you’re making qualify for forgiveness and allows you to make any changes you need to before you’ve made too many nonqualifying payments.

See all the rules at StudentAid.gov. 

Mistake 4: Taking Out the Wrong Type of Loan

There’s more than one type of student loan. But it’s generally best to exhaust your resources for federal aid before turning to alternatives. 

That said, while rare, some students may find the caps on how much you can borrow in federal direct loans don’t cover the total cost of attendance. 

Fortunately, graduate students and parents of undergrads can borrow PLUS loans up to the total cost of attendance. So there’s no need for many students to resort to other sources. If that’s not an option for you, students can sometimes borrow from their state government or the school they plan to attend. 

But the primary source of alternative loans for student borrowers is private student loans from banks or credit unions.

Federal student loans almost always win out over private student loans because of their lower fixed interest rates, flexible repayment options, borrower protections, and the potential for forgiveness.

But if you’re planning to borrow PLUS loans and definitely won’t qualify for the Public Service Loan Forgiveness Program, it’s worth it to find out whether you could get a better deal on a private loan if you have excellent credit. 

Mistake 5: Not Shopping Around for the Best Interest Rate & Terms

If you decide to borrow private student loans, always shop around for the best loan you can qualify for.

Private lenders compete for your business. So going with the first lender you find could mean leaving a better rate on the table.

Use a comparison site like Credible, which matches you with prequalified rates from up to eight lenders with only a soft inquiry on your credit report, which doesn’t affect your credit score. That way, you can compare all your student loan options in one place. 

But it’s not only interest rates that should matter to your bottom line. The best private student loan companies offer various borrower perks in addition to low rates.   

For example, most lenders reduce your interest rate when you enroll in autopay. And some reduce your rate even further with loyalty discounts for doing other business with them, such as opening bank accounts or taking out personal loans. 

Some lenders also offer perks for specific borrowers, such as special payment plans for medical and dental students during their residencies. And some even offer unique perks like free financial coaching or career planning services.  

Just remember to read all the fine print so you know exactly what loan terms you’re agreeing to before you sign. For example, it may lack options for deferment if you fall on hard times or a co-signer release option. Don’t be lured by a shiny interest rate on its own.  

Mistake 6: Not Understanding How Variable & Fixed Interest Rates Work

The rate is only one piece of the interest puzzle. How that rate works also affects how much accrues over time. 

For example, all federal student loans come with fixed interest rates set each year by law. That means the rate stays the same for the life of the loan, which could be a good or bad thing, depending on the interest rate during the year you borrowed. 

But some private student loans have variable interest rates. These fluctuate with market conditions. Although the variable rates are generally the lowest offered rates, it’s because the borrower is assuming the risk that the rate won’t go up, which is likely if you take 10 or more years to repay your student loans.

If you already have a variable-rate private loan, look into refinancing to a fixed-rate loan while rates are low. 

And once you start making payments, contact the student loan company to find out if there are any ways to lower the interest rate, like signing up for an autopay discount.

Mistake 7: Not Understanding Interest Accrual & Capitalization

Another factor to consider is when the interest begins to accrue (accumulate). On subsidized federal loans, that doesn’t happen until after you graduate, leave school, or drop below half-time enrollment. Thus, whatever you borrowed is what you owe up until the day you’re no longer enrolled full time. 

But interest on unsubsidized federal and private loans starts the moment you get the money. So on graduation day, you owe a higher balance than you originally borrowed.

Worse, that interest is capitalized (added to the principal balance as though it were part of what you borrowed) once you graduate, leave school, or drop below half-time enrollment. Since interest accrues according to the principal, that means you’ll then be earning interest on the interest.

Fortunately, you can reduce or even eliminate the burden interest can cause. Make small monthly interest payments while you’re still in school. That ensures none accrues and capitalizes on graduation. 

If you have to, take on a part-time job. As long as you keep it to part-time hours, it shouldn’t interfere with your studies, and a well-chosen college job comes with numerous benefits, like teaching you the money management skills you need to pay off those loans after college. 

Mistake 8: Co-Signing a Loan Without Understanding the Consequences

In some cases, a co-signer can help a student qualify for a loan or get a lower interest rate. 

But co-signing their loan comes with a great deal of risk. You’re taking on equal responsibility for the loan. That means if they make a late payment or miss one entirely, it could impact your credit score. And if they default on the loan, the loan company will come after you for the balance.

And it doesn’t matter how responsible or well-intentioned the borrower is. No one can predict the future, and they could fall on hard times. 

There are several programs designed to help people who have trouble paying back federal loans — if they enroll in them. But private lenders are especially hard to work with. Either way, there are risks associated with co-signing for a student loan. 

If you do agree to co-sign, ask them to look for a company with a co-signer release option, which absolves you of responsibility for the debt after the student makes a certain number of on-time monthly payments.

If not getting help means they can’t attend college, a parent PLUS loan gives you more control than co-signing a private loan. You can borrow up to the total cost of their attendance, but the loan will be in your name. 

If you want, you can still agree that they’re responsible for paying you back (though that agreement isn’t legally enforceable). Plus, if you experience financial hardship, you have access to federal repayment plans and borrower protections.

However, don’t sacrifice retirement savings or go into debt paying for your kids’ college. It could leave you unprepared, potentially placing a financial burden on them later.

Mistake 9: Putting Off Making a Repayment Plan

Many borrowers get lulled into thinking they can wait until after they graduate and their six-month grace period ends before they have to start worrying about their student loans. But you need to prepare your budget long before then.

A student loan payment could easily be $400 per month (maybe more). That’s a hefty chunk of anyone’s take-home pay. But recent grads won’t make as much as established professionals in any field. 

And if you don’t think about it for the first six months post-graduation, it’s easy to establish a post-college life that doesn’t leave room for it, such as upgrading your apartment or buying a new car.

Before you graduate, find out what your monthly payment will be. You can check your student loan balance by creating a student account at StudentAid.gov.

Then, build the rest of your post-college budget around your monthly student loan payment. That ensures you won’t take on more financial obligations than you can afford. Unfortunately, that may mean living that ramen-eating college lifestyle for the first couple of years after you graduate. 

Mistake 10: Choosing the Wrong Repayment Plan

The automatic student loan repayment schedule is 10 years of fixed payments, but it’s not the best option for all borrowers.

You don’t want to string out payments for decades unless it’s necessary. But income-driven repayment plans, which forgive any remaining balance after you make 240 to 300 (20 to 25 years) of qualifying payments, may be a saving grace for borrowers with high debt and low income. 

And for those entering public service fields, an income-driven repayment plan is the gateway to the Public Service Loan Forgiveness Program, which forgives any remaining balance in as few as 120 qualifying payments. 

But even if you stick to the standard 10-year plan, you still have options. 

For example, you can repay your loans on a graduated plan, which lets you make smaller payments at the beginning. Your payments then gradually rise every two years. This plan is ideal for those who must start in a lower-paying job but expect their income to increase substantially as they gain work experience.

Use the loan simulator at StudentAid.gov to see how much you can expect to repay under different repayment plans. It shows your monthly payments, total amount owed, and any potential balance you could have forgiven under an income-driven repayment plan as well as the date you can expect to have your loans paid off.

Use this information to weigh your options. Ask yourself: 

  • Is it better to pay off your loans as quickly as possible by sticking to the standard 10-year plan? Is that realistic at your current income? 
  • How big will your payments be 10 years down the line if you opt for graduated repayment? Are you likely to make enough money for that to be practical? 
  • Is it better to make your current situation more manageable through an income-driven or extended repayment plan? 

Lowering your monthly payment will have consequences since it means more interest will accrue. But the loan simulator can give you an accurate picture of what those consequences will look like. 

Mistake 11: Only Making the Minimum Payment

The longer you sit on debt, the more it costs you thanks to the interest. So if you have any wiggle room in your budget, put whatever money you can toward your student loans to pay them off as quickly as possible. 

Even small amounts can make a big difference.

For example, if you borrowed $40,000 in student loans at 6% interest, your monthly payment would be $444. But if you paid $500 a month instead — a difference of only $56 — you’d save $1,957 in interest and have them repaid a year sooner.

If you can, opt for a side gig or cut your expenses. Additionally, put any windfalls — like tax refunds, gifts, or inheritances — toward your loans.  

But this is key: When you make any extra payments toward your loans, ensure you indicate the company should apply it to the principal. The more you pay down the principal, the less interest accumulates.

Mistake 12: Refinancing Without Considering the Pros & Cons

Refinancing is a common strategy for lowering the cost of debt, whether it’s a mortgage refinance or a student loan. But while refinancing can score you a lower interest rate, interest rates aren’t the only consideration.

When you refinance a student loan, you can only do so through a private refinance lender. That means you lose access to all the benefits of federal student loans, including federal repayment plans, borrower protections, generous deferment and forbearance options, and federal loan forgiveness. 

It may still be worth it to you, depending on the rate you can get. But it’s crucial to weigh that against all you’d be giving up.

Even if the private interest rate is lower, the future is unpredictable, and you never know if you could need those federal benefits. And you’ll lose all access to federal loan forgiveness with a refinance.

On the other hand, if you have private student loans, there’s no reason not to refinance. 

Mistake 13: Postponing Payments Unnecessarily

Both federal and private student loans have multiple options for deferment and forbearance. These allow you to temporarily suspend payments for various reasons, including full-time enrollment in school, economic hardship, military deployment, and serving in AmeriCorps. 

Sometimes, deferment or forbearance makes sense, such as while you’re enrolled in school. But prolonged use of these options just increases your overall balance because interest keeps piling up. 

Interest accrues on all but subsidized federal loans during deferments. And it accrues on all loans during forbearance. Additionally, that interest is capitalized (added to the principal balance) at the end of the deferment or forbearance. 

Only use these options when absolutely necessary. And if possible, make interest payments during periods of deferment or forbearance to prevent its accrual. 

If you’re deferring or forbearing for economic hardship and anticipate the hardship will last longer than a month or two, apply for an income-driven plan instead. 

Depending on the severity of your situation, your monthly payments could be calculated as low as $0. And some plans don’t capitalize interest and even have interest subsidies, which means the government covers the interest on your loans for a specified period.  

Additionally, those $0 “payments” count toward potential student loan forgiveness. But only periods of economic hardship deferment count toward the forgiveness clock. No other form of deferment or forbearance qualifies. And there’s a cap on how long you can defer for economic hardship.

Plus, if your financial situation changes, you can always change your repayment plan. 

Mistake 14: Missing Payments

Missing payments can result in late fees. The student loan company tacks these onto your next month’s minimum payment. So if you had a hard time paying this month, it won’t be easier next month. 

Plus, when you make your next payment, your money covers fees and interest before going toward the principal. So multiple fees could mean paying your principal down slower. And interest accrues according to the principal balance, so the higher you keep that balance, the more interest you pay.

Worse, if you miss enough payments, it can result in a default of your loans, which comes with severe consequences, such as damaged credit or wage garnishment or seizure of your tax refunds, Social Security benefits, or property. 

There’s never a reason to miss a payment on a federal student loan if you’re facing financial hardship. Simply call the company and let them know. Depending on what you qualify for, you can choose from multiple options, including deferment, forbearance, or an income-driven repayment plan.

Private lenders are tougher to work with, as fewer repayment options are available. But many are still willing to work with you if you explain the situation. Most of the top lenders have limited programs for deferment or forbearance in times of economic hardship. 

Mistake 15: Keeping Your Assigned Payment Due Date

Student loan companies allow you to adjust your monthly due date. That can be helpful if you’re having trouble stretching your dollars from one paycheck to the next.

Plus, if your bills are anything like mine, most of them are due at the same time of month. Thus, if you get paid biweekly, adjusting your due date to a different time of the month can make things easier.  

If you want a different due date, contact the company handling your student loans and ask if you can adjust your due date to one more beneficial for you. You may even be able to change it through your online account.

Ensure you get confirmation of the new date in writing. That protects you if you get hit with any late fees in error. Additionally, ask when the new date takes effect. It could take a billing cycle or two, depending on the lender. 

Mistake 16: Falling for Student Loan Scams

Many borrowers have reported receiving phone calls, emails, letters, and texts offering them relief from their student loans or warning them federal forgiveness programs will end soon if they don’t act now.

But the services these scam debt relief companies offer usually steal borrowers’ money or private information rather than grant any actual relief. 

Other student loan scams take fees for helping students apply for income-driven repayment plans or consolidate their loans. However, borrowers never have to pay to sign up for any federal repayment programs. They only need to contact the company in charge of their loan.

In general, if someone contacts you, avoid giving them any personal information. No matter who they claim to be, either tell them to send their request in writing or say you’ll call them back. Then verify their story by contacting your student loan company at their listed phone number or through their website.

Additionally, never pay an upfront fee for student loan services. The government doesn’t charge application fees for any of their loan programs. They also won’t claim an offer is only available for a limited time since all the terms are set by law every year and are available to all students.

For more red flags to watch for, check out the Department of Education’s tips on avoiding student loan scams. 

Mistake 17: Forgetting to Update Your Contact Information

You are responsible for making all your loan payments whether you received the bill or not. Additionally, the lender in charge of your loan can change, and you need to ensure you’re able to receive that information so you always know who to contact about paying and managing your loans.

Thus, it’s on borrowers to ensure the company in charge of their student loans has all their current contact information, including mailing address, email address, and phone number. That’s especially the case if you moved after you graduated or listed a parent’s address on your application forms.

Log into your student loan account to ensure your contact information is current. 

If you don’t know who services your student loans, check with your school’s financial aid office. For federal loans, you can always create an account on StudentAid.gov.

Then, each time you move, get a new email address or change your number, update that info with the company handling your student loans.

Mistake 18: Not Asking for Help

Paying off student loans can be overwhelming, especially if you’re dealing with low income or a large amount of debt. Depending on your circumstance, it could feel like you’re drowning and may never escape.

Trust me, I know how it feels. And I’m hardly alone. A simple online search reveals dozens of stories of borrowers who’ve consistently paid on their loans yet owe more than ever thanks to the compounding effects of interest, which often feels like quicksand. 

But paying late or not at all only makes the situation worse. Damage to your credit report can make it difficult for you to rent an apartment, buy a car, or even get a job. And default can leave you subject to wage garnishment, steep collection penalties, and even lawsuits.  

But hope isn’t lost. There is help. Resources exist for borrowers who need an extra hand.

The first step is to reach out to the student loan company. See if there’s a payment plan that’s manageable for you. Even if there isn’t, let them know what payment you can afford, and go from there. 

If the company is uncooperative, contact the federal student loan ombudsman. 

Borrowers can also reach out to nonprofit student loan counselors, such as the National Foundation for Credit Counseling or The Institute of Student Loan Advisors. These organizations work with borrowers to help them figure out the best strategies for dealing with their loans and overall financial health. 

Alternatively, if you’ve reached the point of needing to settle your student loans or file for bankruptcy, seek an attorney who specializes in student loans. For private student loan help, try The National Association of Consumer Advocates. For federal student loans, search the American Bar Association.


Final Word

The United States is currently experiencing a student loan crisis because of how the debt has impacted American lives.

It’s affected borrowers’ ability to save for retirement and buy a home. It’s also impacted people’s ability to start a family or even choose a job for passion over a paycheck.

And it can do so for decades. Many millennials who’ve entered middle age continue to face debt repayment. And many feel college wasn’t worth it as a result.

But you don’t have to be one of these statistics. I write about student loans precisely to help others avoid my mistakes. Learn from this list so you can borrow wisely and avoid overwhelming student loan debt.  

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Sarah Graves, Ph.D. is a freelance writer specializing in personal finance, parenting, education, and creative entrepreneurship. She’s also a college instructor of English and humanities. When not busy writing or teaching her students the proper use of a semicolon, you can find her hanging out with her awesome husband and adorable son watching way too many superhero movies.

Source: moneycrashers.com

Best Online Life Insurance Companies for 2022

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Additional Resources

In the old days, applying for life insurance was tedious, time-consuming, and stressful. The process took weeks to complete, much of that spent waiting on the results of a medical exam. And you didn’t know how much your policy would cost until everything was said and done — or even if you’d qualify for a policy at all.

Fortunately, the old days are over, at least for life insurance applicants who apply online. Also known as algorithmic underwriters or algorithmic insurance companies, online life insurance companies give you an up-or-down decision within minutes, often without a medical exam or many questions about your medical history. You can apply over lunch or dinner and then get on with life.

Best Online Life Insurance Companies

Not all online life insurance companies are created equal, of course. These are among the very best.

Each of the companies on this list does at least one thing really well, and our top pick offers the best overall value for the widest number of potential applicants. Here’s what you need to know about each.

Best Overall: Ladder

Ladder Life Insurance Logo

Ladder is one of the best life insurance companies. It tops our list of the best online life insurance companies thanks to a potent collection of strengths:

  • Up to $3 million in term life insurance coverage without a medical exam — double what most competitors allow
  • In-home medical exams for policies larger than $3 million — the application process remains all-online otherwise
  • Choose from 10- to 30-year term coverage options
  • Option to scale down coverage over time without reapplying
  • Approval within minutes for many applicants
  • Backed by national insurers with strong financial strength ratings

Best for Fast Approval: Bestow

Bestow Life Insurance Logo

Bestow earns its spot as one of the best no-exam life insurance companies thanks to a streamlined digital application and underwriting process that produces results in as little as five minutes. If Bestow doesn’t need any additional information from you, you can apply for life insurance and get an up-or-down approval decision during your coffee break.

Its features include:

  • Term life insurance only
  • Term lengths from 10 to 30 years
  • Policy death benefits as low as $50,000
  • Coverage up to $1.5 million per policy with no medical exam required
  • Open to applicants ages 18 to 60
  • A+ (Superior) financial strength rating from A.M. Best

Best Premium Membership Rider: Haven Life

Haven Life Logo 1

Haven Life is one of the best online term life insurance companies around, but it really shines for a reason that’s not directly related to insurance. Haven Life offers the best premium membership rider — an optional add-on filled with potentially valuable features.

That rider is Haven Life Plus. It’s free to policyholders wherever it’s offered and provides at least $150 in annual value to policyholders. It includes:

  • A customizable and legally binding will that you can store online
  • A subscription to Adaptiv, a workout video and music library
  • A subscription to Timeshifter, an app designed to fight jet lag
  • A subscription to Lifesuite, a secure digital storage vault
  • A 15% discount on eligible MinuteClinic products and services

Haven Life has some additional features worth noting, including:

  • Term life coverage up to $3 million with a medical exam
  • No-exam coverage up to $500,000 through Haven Simple
  • AgeUp, an annuity product that can supplement your retirement income after you turn 90

Best for Nontraditional Underwriting: Sproutt

Sproutt Life Insurance Logo

Sproutt is an online life insurance broker that uses an innovative model called the Quality of Life Index (QL Index) to assess life insurance applicants’ risk. 

While it doesn’t completely replace traditional considerations in Sproutt’s application process — or in the underwriting processes of the insurers Sproutt works with — the QL Index goes beyond the usual medical and lifestyle information to consider factors like:

  • How often you exercise and what kind of exercise you do
  • How much and how well you sleep
  • Your emotional health
  • Your eating habits and overall nutrition
  • Your work-life balance

Additional features:

  • Access to fully medically underwritten term life, no-exam life (simple issue life insurance), and guaranteed issue life insurance
  • Multiple types of permanent life insurance available, including whole, universal, and variable universal
  • Get quotes within minutes
  • Apply directly with the insurer with help from Sproutt agents 

Best for Guaranteed Issue Life Insurance: Ethos

Ethos Life Insurance Logo

Ethos is rare among online life insurance companies because it offers permanent life insurance. Most competitors stick with term life.

Ethos’ permanent life insurance offering is a low-value whole life insurance policy for people between the ages of 66 and 85. Its features include:

  • Death benefit between $1,000 and $30,000
  • Guaranteed issue life insurance, meaning you can’t be turned down for medical reasons
  • No expiration, meaning the policy is effective until you die or stop paying premiums
  • Guaranteed level premiums, meaning your premiums won’t increase over time
  • Accidental death is covered right away
  • Nonaccidental death coverage kicks in two to three years after the policy effective date in most cases

Ethos’s term life offering is no slouch either. Its benefits include:

  • Amount of coverage ranges from $20,000 to $1.5 million
  • 10- to 30-year terms
  • Guaranteed renewable after the term ends, albeit at a higher premium

Best for Higher Coverage Limits: Fabric

Fabric Life Insurance

Fabric offers online life insurance policies with coverage up to $5 million. That’s an unusually high limit for a streamlined, all-online application process. And Fabric offers a no-exam option for applicants with uncomplicated health histories, although not up to the $5 million coverage limit.

Additional features:

  • Accidental death coverage available up to $500,000
  • A+ (Superior) financial strength rating
  • Low pricing, with monthly rates starting as low as $1 for $1 million in coverage
  • Will-making services available
  • Secure online vault for financial and personal documents at no additional cost

Best for Price Transparency: Walnut

Walnut Life Insurance Logo

Walnut sets itself apart with what it calls “price-first” term life insurance. Basically, you know how much you’ll pay for 10-year term coverage before you apply, making it easier to fit a new monthly payment into your budget (or decide to go a different direction). You never have to take a medical exam as a condition of coverage.

Walnut also offers a broad lineup of value-adds through a premium membership program included in the cost of insurance. Starting at $10 per month, this includes subscriptions to:

  • Headspace Plus, an app offering guided meditation and self-directed therapy
  • ClassPass Digital, a library of home workout videos
  • Dashlane Premium, a password manager and auto-fill app

According to Walnut, this package is a $25 monthly value. If you want even more, upgrade to a Digital Protection membership for an additional monthly fee and enjoy:

  • 24/7 access to a cyber support helpline
  • Up to $1 million in stolen funds reimbursement if you’re the victim of identity theft

Best Online Broker for Life Insurance Only: Quotacy

Quotacy Life Insurance

Quotacy is an online insurance broker specializing in life insurance quotes. In fact, a life insurance quote is the only type of insurance quote you can get through Quotacy. 

Quotacy’s narrow focus on life insurance gives it some advantages over other online insurance brokers:

  • Access to term life policies as long as 40 years — elsewhere, policies generally top out at 30 years
  • Access to a variety of types of life insurance, including term life
  • Multiple permanent life insurance options, including whole life policies and universal life policies
  • A five-minute, all-online quote creation process
  • Dedicated agents who understand life insurance
  • A vast insurer network that ensures competitive life insurance rates

Best Online Broker for Other Policy Types and Bundles: Policygenius

Policygenius Logo

Policygenius is an all-purpose online insurance quote aggregator. Unlike Quotacy, it focuses on a variety of different types of insurance, including: 

If you’re shopping for more than one type of insurance right now, Policygenius is your best choice for fast answers. And if you’re paired with a life insurance provider that offers other types of insurance too, there’s a good chance Policygenius can hook you up with a money-saving bundle discount. 


Methodology: How We Select the Best Online Life Insurance Companies

We use several criteria to evaluate online life insurance companies and select the very best for our readers. Some relate to the application process or policy underwriting, while others speak to the overall user experience and quality of the insurers themselves.

Financial Strength and Customer Satisfaction

Third-party financial strength ratings assess insurers’ ability to pay out death benefits in the future. When possible, we use ratings from A.M. Best, a highly respected rating agency that specializes in the insurance industry.

Customer satisfaction is another important measure of insurer quality. The top authority for customer satisfaction ratings in this industry is J.D. Power, which ranks life insurance companies and life insurance products annually.

Policy Types Available

Many online life insurance companies offer term life insurance only. Those insurers that also offer permanent life insurance coverage generally require medical underwriting for it, lengthening the application process.

That said, if you prefer to have both options available when you apply, you’ll want to focus your attention on insurers that can accommodate.

Term Options

Online term life insurance policies typically range from 10 to 30 years. Some insurers offer shorter-term policies, down to five or even two years. 

Unless otherwise specified in the terms of the policy, you can renew your policy once the initial term expires. However, this may require another round of underwriting and will definitely involve a higher premium.

No-Medical-Exam Options

One of the core benefits of online life insurance is the seamless application process. This process is helped along in many cases by a lack of medical underwriting. 

The insurer might ask some basic questions about your personal and family medical history and lifestyle. It’ll check your answers against your health records as well. But it won’t require you to undergo a medical exam as a condition of coverage.

No-medical-exam coverage costs more than fully medically underwritten coverage because it provides less information about your risk of premature death. However, this is a price many would-be policyholders are willing to pay, especially if they have reason to believe a medical exam would turn up health-related red flags.

The best insurers for no-exam coverage have high coverage limits — above $1 million — and terms of at least 20 years for younger and middle-aged applicants.

Coverage Amount (Death Benefit)

Online life insurance death benefits typically range from as low as $25,000 to $50,000 for final expenses insurance to upwards of $1.5 million. If you have higher life insurance needs, look to an insurer that can accommodate — Haven Life’s coverage amounts range up to $3 million, for example.

Policy Add-ons (Riders)

Many online life insurance companies offer policy add-ons, also known as riders. Some of the most common include:

  • Return of premium riders, which reimburse the policyholder for premiums paid during the policy term
  • Accelerated death benefit, which allows terminally ill policyholders to claim a portion of the death benefit before they die
  • Accidental death rider, which pays out an additional death benefit if the policyholder dies in an accident covered by the rider

Online Life Insurance FAQs

You have questions about getting life insurance online. We have answers.

Do You Need to Get a Medical Exam When You Apply for Life Insurance Online?

Often, no. If you’re applying for a life insurance policy worth less than $500,000, you probably won’t have to get a medical exam if you don’t want to. Many insurers offer no-medical-exam coverage as high as $1 million or $1.5 million, and a few go higher still — up to $2 million or $3 million.

That said, if your top concern is paying as little as possible for coverage and you have no known health issues, opt for the medical exam. As long as the exam doesn’t raise any red flags about your health, you’ll pay less for a policy that requires one.

How Much Does Online Life Insurance Cost?

How much you pay for an online life insurance policy depends on a number of factors:

  • The policy value — coverage amount or death benefit
  • The policy term — the longer the term, the higher the premium
  • The type of policy — term life is always cheaper than permanent life
  • Your personal medical history
  • Your family medical history
  • The results of your life insurance medical exam if you take one
  • Your age when you apply
  • Your lifestyle, including whether you use or have ever used tobacco and whether you have any risky hobbies

The best way to estimate your life insurance cost is to use an online quote aggregator like Policygenius or Quotacy. 

What Do You Need to Apply for Life Insurance Online?

To apply for life insurance online, you’ll need some or all of the following:

  • A good idea of how much life insurance you need
  • Basic personal information, like your address and Social Security number
  • Basic financial information, such as your annual income
  • Your height and weight
  • Your recent medical history
  • Information about your lifestyle and personal habits

If required, you’ll need to take a medical exam in the days or weeks after you send in your initial application for coverage. Many insurers offer in-home exams, but some ask you to visit a testing facility. 

You’ll also need to give your consent for the insurer to pull your Medical Information Bureau file. This file contains important information about your medical history and previous insurance applications, helping would-be insurers check the information you provide on your application against the public record.  

Is Life Insurance Worth It?

Often, yes. One of the most harmful myths about life insurance is that only certain people need it, such as parents of young children or people with lots of debt. In fact, there are many reasons to buy life insurance:

  • Covering final expenses, such as funeral and burial costs
  • Preventing major debts from passing to a surviving spouse or partner
  • Covering higher costs borne by survivors, such as child care and health insurance
  • Covering future education expenses for your children
  • Protecting your business partners’ financial interests
  • Maintaining your survivors’ standard of living
  • Creating a store of cash value that you can borrow against during your lifetime

Chances are, at least one of these reasons applies to you. And if that’s the case, some form of life insurance is probably worth it.


How to Choose the Best Online Life Insurance Company

These are the best online life insurance companies on the market right now, but that doesn’t mean they’re interchangeable. The best choice for your life insurance needs might not be the best choice for your neighbor — or even your spouse.

To choose the best online life insurer for you, think about why you’re applying for life insurance in the first place.

Do you want an affordable term life policy that lasts until you pay off your house in 15 years? Do you want to make sure your future kids’ college education is paid for, 20 or 25 years down the road? Do you want a policy that lasts indefinitely, creating a cash value reserve that you can tap as you age and possibly establishing generational wealth for your heirs?

Likewise, think about what you want out of your relationship with your insurer, beginning with the application process. Are you willing to pay more to forgo medical underwriting? Or do you prefer a seamless, super-fast application process that produces an answer — and an active policy — within minutes?

It’s your call. Fortunately, you can’t go wrong with any of the options on this list.

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Brian Martucci writes about credit cards, banking, insurance, travel, and more. When he’s not investigating time- and money-saving strategies for Money Crashers readers, you can find him exploring his favorite trails or sampling a new cuisine. Reach him on Twitter @Brian_Martucci.

Source: moneycrashers.com

This Surprising Generation Saves Best for Retirement

Younger and older workers in an office
fizkes / Shutterstock.com

Saving for retirement is like eating our peas and carrots: We know we should do more of it, but few of us do.

However, it appears that some generations are better than others when it comes to putting away money for their golden years. In fact, one surprising generation can teach the rest of us a thing or two about building a solid financial future.

Recently, Empowering America surveyed more than 2,500 Americans to learn more about how they are saving and preparing for retirement. Following is a look at how four different generations are doing.

1. Baby boomers

Baby boomer couple looking at their finances
John Keith / Shutterstock.com

Participants in this generation contributing to retirement plans: 83.9%

We give boomers a bit of a pass for their sagging savings rate, which is the lowest among the generations surveyed. After all, a decent percentage of boomers are already in retirement and therefore no longer saving for it.

Still, Empowering America characterizes the last-place finish of baby boomers as somewhat surprising, and it is likely that more than a few members of this generation regret not having saved more for their golden years.

If you are among them, check out the tips from Money Talks News founder Stacy Johnson in “I’m 55 and Have No Retirement Savings — What Should I Do?” While you might be a tad past that age, the advice is still great for anyone who is older and only has saved a little.

2. Generation X

Dmytro Zinkevych / Shutterstock.com

Participants in this generation contributing to retirement plans: 85.7%

Members of Generation X are not ready to retire just yet, but they can see the promised land just over the horizon. They are doing a better job than boomers of saving, but younger workers still are outpacing them.

While it might be too late for a baby boomer with no savings to end up rich, workers who belong to Generation X still have time. So, if your goals are ambitious, check out “5 Ways You Can Save $500,000 in 15 Years.”

3. Millennials

A millennial Black couple happily packs to move to another city
fizkes / Shutterstock.com

Participants in this generation contributing to retirement plans: 86%

This much-maligned generation is doing a surprisingly good job of saving for retirement. If you are a millennial, don’t worry about the steady stream of sneers you hear from baby boomers and members of Generation X. It appears that you are going to get the last laugh.

4. Generation Z

Generation Z friends
Rawpixel.com / Shutterstock.com

Participants in this generation contributing to retirement plans: 86.8%

In these trying times, here is a heartening statistic: The working members of the youngest generation surveyed are doing the best job of saving for retirement.

This is especially good news because the earlier you start saving, the more time your money has to compound — and the wealthier you are likely to get.

So, if you are a member of one of the older generations, don’t curse at the young whippersnappers around you or holler for them to “get off your lawn.” Treat them nicely, and maybe they will give you a loan — or at least teach you some valuable lessons about the right way to save.

Can’t find a friendly member of Generation Z to guide you? Sign up for the Money Talks News’ retirement course, The Only Retirement Guide You’ll Ever Need.

Money Talks News founder Stacy Johnson is your guide for the course — a 14-week boot camp intended for those who are 45 or older. It can teach you everything from Social Security secrets to how to time your retirement.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

Here’s What to Do Before Debt Collectors Start Calling

Take your car insurance bill, for example. When’s the last time you checked car insurance prices, anyway? You should shop your options every six months or so — it could save you some serious money and help you avoid missed payments.
Make sure your bad credit doesn’t give the debt collectors more ammo to use against you. Sign up for free (it only takes about 90 seconds) and see how much you could improve your score.
Kari Faber is a staff writer at The Penny Hoarder.
***Like Cooper, 60% of Credit Sesame members see an increase in their credit score; 50% see at least a 10-point increase, and 20% see at least a 50-point increase after 180 days.

1. Get Rid of Dings on Your Credit Report and Raise Your Score

If you went to the hospital without insurance or you haven’t met your deductible yet, doctors’ bills can be pretty steep.
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A website called Insure.com makes it super easy to compare car insurance prices. All you have to do is enter your ZIP code and your age, and it’ll show you your options.
If your bills are lower, there’s less of a chance you’ll miss a payment due to lack of funds. And no missed payments means no debt collectors calling you every single day. But a lot of these money-sucking bills are ones you can’t cancel.
And the truth is, your credit card company doesn’t really care. It’s just getting rich by ripping you off with high interest rates — some up to 36%. But a website called AmOne wants to help.
Most Americans have some sort of debt — and not all of it is good debt, like a mortgage, car loan or student loans, which are considered good investments.

2. Stop Paying Your Credit Card Company Insane Interest Rates

Privacy Policy
The good news? A free website called Credit Sesame makes it easy to put your credit score on track to reach your debt-free goals. We even talked to one guy, James Cooper, of Atlanta, who used Credit Sesame to raise his credit score nearly 300 points in six months.*** He says they showed him exactly what to do — he was even able to open his first credit card.
Using Insure.com, people have saved an average of 9 a year.
What could adding 300 points to your score mean for your goals? It could easily save you thousands of dollars over the life of a car loan or mortgage.
Yup. That could be 0 back in your pocket just for taking a few minutes to look at your options.
Source: thepennyhoarder.com

3. Lower Your Bills to Avoid Missed Payments

While it doesn’t make the debt disappear (you are still liable for these payments), a payment plan makes paying off these debts more manageable and will keep the debt collectors off your back so long as you make each monthly payment.
If you have a low score with a few dings on your report, you won’t get access to decent interest rates on your loans. That means you’ll be paying more in interest and less on the actual loan amount — taking you sometimes years longer to pay it off and thousands of dollars more. If it’s a mortgage, the cost of your poor credit score could mean tens of thousands of dollars gone to waste.
The benefit? You’ll be left with one bill to pay each month. And because personal loans have lower interest rates (AmOne rates start at 2.49% APR), you’ll get out of debt that much faster. Plus: No credit card payment this month.
Thankfully, doctors and hospitals can be willing to work with you. Some medical providers will offer a discount if you’re strapped for cash, and most are open to payment plans. So instead of 0 out of pocket today, you could be paying a little over a month for the next six months.
If you have credit card debt, you know. The anxiety, the interest rates, the fear you’re never going to escape and the debt collectors will set up camp on your doorstep forever…

4. Try to Negotiate Your Payments and Get On a Payment Plan

In just 90 seconds, Credit Sesame will give you access to your credit score, any debt-carrying accounts and a handful of personalized tips to improve your score. You’ll even be able to spot any errors holding you back (one in five reports have one).
Ready to stop worrying about money?
You don’t need a perfect credit score to get a loan — and comparing your options won’t affect your score at all.  Plus, AmOne keeps your information confidential and secure, which is probably why after 20 years in business, it still has an A+ rating with the Better Business Bureau.
Debt happens.
Credit Sesame does not guarantee any of these results, and some may even see a decrease in their credit score. Any score improvement is the result of many factors, including paying bills on time, keeping credit balances low, avoiding unnecessary inquiries, appropriate financial planning and developing better credit habits.
What does your credit score have to do with debt? Turns out — it can be a major factor in you getting out of debt quicker. <!–

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Credit card debt, medical debt, overdue bills and high interest loans are just a few of the types of bad debt that can wreak havoc on your life. They can destroy your credit, snowball into even more debt and, yep, have the debt collectors hounding you to pay up.

Factoring Inflation into Your Retirement Plan

Right now, inflation is top of mind for everyone, perhaps especially retirees.

Inflation is important. But it is only one of the risks that retirees have to plan for and manage. And like the other risks you have to manage, you can build an income plan so that rising costs (both actual and feared) do not ruin your retirement.

Inflation and Your Budget

Remember that in retirement your budget is different than when you were working, so you will be impacted in different ways. And, of course, when you were working your salary and bonuses might have gone up with inflation, which helped offset long-term cost increases.

Much of your pre-retirement budget was spent on housing — an average of 30% to 40%. Retirees with smaller or paid-off mortgages will have lower housing costs even as their children are busy taking out loans to buy houses, and even home equity loans to pay for home improvements.

On the other hand, while health care looms as a big cost for everyone, for retirees these expenses can increase faster than income. John Wasik recently wrote an article for The New York Times that cited a recent study showing increases in Medicare Part B premiums alone will eat up a large part of the recent 5.9% cost of living increase in Social Security benefits. As Wasik wrote, “It’s difficult to keep up with the real cost of health care in retirement unless you plan ahead.”

Inflation and Your Sources of Income

To protect yourself in retirement means (A) creating an income plan that anticipates inflation over many years and (B) allowing yourself to adjust for inflation spikes that may affect your short-term budget.

First, when creating your income plan, it’s important to look at your sources of income to see how they respond directly or indirectly to inflation.

  1. Some income sources weather inflation quite well. Social Security benefits, once elected, increase with the CPI. And some retirees are fortunate enough to have a pension that provides some inflation protection.
  2. Dividends from stocks in high-dividend portfolios have grown over time at rates that compare favorably with long-term inflation.
  3. Interest payments from fixed-income securities, when invested long-term, have a fixed rate of return. But there are also TIPS bonds issued by the government that come with inflation protection.
  4. Annuity payments from lifetime income annuities are generally fixed, which makes them vulnerable to inflation. Although there are annuities available that allow for increasing payments to combat inflation.
  5. Withdrawals from a rollover IRA account are variable and must meet RMD requirements, which do not track inflation.   The key in a plan for retirement income, however, is that withdrawals can make up any inflation deficit. In Go2Income planning, the IRA is invested in a balanced portfolio of growth stocks and fixed income securities. While the returns will fluctuate, the long-term objective is to have a return that exceeds inflation.
  6. Drawdowns from the equity in your house, which can be generated through various types of equity extraction vehicles, can be set by you either as level or increasing amounts. Use of these resources should be limited as a percentage of equity in the residence.

The challenge is that with these multiple sources of income, how do you create a plan that protects you against the inflation risk — as well as other retirement risks?

Key Risks That a Retirement Income Plan Should Address

A good plan for income in retirement considers the many risks we face as we age. Those include:

  1. Longevity risk. To help reduce the risk of outliving your savings, Social Security, pension income and annuity payments provide guaranteed income for life and become the foundation of your plan. As one example, you should be smart about your decision on when and how to claim your Social Security benefit in order to maximize it.
  2. Market risk. While occasional “corrections” in financial markets grab headlines and are cause for concern, you can manage your income plan by reducing your income’s dependence on these returns.  By having a large percentage of your income safe and less dependent on current market returns, and by replanning periodically, you are pushing a significant part of the market risk (and reward) to your legacy. In other words, the kids may receive a legacy that reflects in part a down market, which can recover during their lifetimes.
  3. Inflation risk. While a portion of every retiree’s income should be for their lifetime and less dependent on market returns, you need to build in an explicit margin for inflation risk on your total income. The easiest way to do that is to accept lower income at the start.  For example, under a Go2Income plan, our typical investor (a female, age 70 with $2 million of savings, of which 50% is in a rollover IRA) can plan on starting income of $114,000 per year under a 1% inflation assumption. It would be reduced to $103,000 under a 2% assumption.

So, what factors should you consider in making that critical assumption about how much inflation you need to account for in your plan?

Picking a Long-Term Assumed Inflation Rate  

Financial writers often talk about the magic of compound interest; in real numbers, it translates to $1,000 growing at 3% a year for 30 years to reach $2,428. Sounds good when you’re saving or investing. But what about when you’re spending? The purchase that today costs $1,000 could cost $2,428 in 30 years if inflation were 3% a year.

When you design your plan, what rate of inflation do you assume? Here are some possible options (Hint: One option is better than the others):

  • Assume the current inflation of 5.9% is going to continue forever.
  • Assume your investments will grow faster than inflation, whatever the level.
  • Assume a reasonable long-term rate for inflation, just like you do for your other assumptions.

We like the third choice, particularly when you consider the chart below. Despite the dramatically high rate of today’s inflation that affects every result in the chart, the long-term inflation rate over the past 30 years was 2.4%. For the past 10 years, it was even lower at 2.1%.

A Long-Term View Smooths Inflation Spikes

A table shows what a $1,000 item would cost today if purchased in years ranging from 2020 to 1991, showing inflation rates of 6.9% currently, down to 2.4% for 30 years.A table shows what a $1,000 item would cost today if purchased in years ranging from 2020 to 1991, showing inflation rates of 6.9% currently, down to 2.4% for 30 years.

Managing Inflation in Real Time

Whether you build your plan around 2.0%, 2.5% or even 3.0%, it is helpful to realize that any short-term inflation rate will not match your plan assumption. My view is that you can adjust to this short-term inflation in multiple ways.

  • Where possible, defer purchases that are affected by temporary price hikes.
  • Where you can’t defer purchases, use your liquid savings accounts to purchase the items, and avoid drawing down from your retirement savings.
  • If you believe price hikes will continue, revise your inflation assumption and create a new plan. Of course, monitor your plan on a regular basis.

Inflation as Part of the Planning Process

Go2Income planning attempts to simplify the planning for inflation and all retirement risks:

  1. Set a long-term assumption as to the inflation level that you’re comfortable with.
  2. Create a plan that lasts a lifetime by integrating annuity payments.
  3. Generate dividend and interest yields from your personal savings, and avoid capital withdrawals.
  4. Use rollover IRA withdrawals from a balanced portfolio to meet your inflation-protected income goal.
  5. Manage your plan in real time and make adjustments to your plan when necessary.

Inflation is a worry for everyone, whether you are retired or about to retire. Put together a plan at Go2Income  and then adjust it based on your expectations and investments. We will help you create the best approach to inflation and all retirement risks you may face.

President, Golden Retirement Advisors Inc.

Jerry Golden is the founder and CEO of Golden Retirement Advisors Inc. He specializes in helping consumers create retirement plans that provide income that cannot be outlived. Find out more at Go2income.com, where consumers can explore all types of income annuity options, anonymously and at no cost.

Source: kiplinger.com

18 Great Jobs For Retirees for Flexibility and Extra Cash

But true personal shoppers are more likely to purchase clothing and accessories than groceries. A personal shopper often finds items and then sends photos and descriptions to the person who hired them to get approval.

A security guard who does not carry a weapon serves as a presence to discourage inappropriate behavior. While many large businesses like Target or Wal-Mart hire security personnel from a service, small employers such as charitable or service organizations are likely to hire someone who is reliable and gives the appearance of authority.
You are more likely to work on an hourly wage determined by your experience and amount of work you are required to perform. There are also job firms that provide virtual assistants; you can sign on with them and accept work as it is offered to you.
School bus drivers can earn up to per hour. They have regular hours with the opportunity to earn extra for field trips or outings. Some states require a specific license (a Commercial Drivers License, or CDL, for example) or require you to pass a test to qualify.
Hourly pay for security guards without weapons training is likely to be between and . Night-time security guards are likely to make more than daytime ones.
Plan on some up-front costs, such as a portable bar (if the host doesn’t have one) and basic bar tools. The host is expected to supply the alcohol and mixers. And to protect against possible liability you might want to consider an annual liability policy.

18 Part-time Jobs for Retirees

Many small or civic organizations cannot afford, nor do they truly need, a full-time bookkeeper or accounting service. They are not in it for the money. Often, they are charitable or non-profit organizations. But they need occasional bookkeeping, often with an eye towards tax advantages.
Recent news reports indicate there are many job openings for school bus drivers.
There are no actual nanny or babysitter licenses or certifications in the United States, but many families require that nannies be bonded, which is a guarantee of service. It is a protection against someone failing to show up for work; one such failure forfeits the bond and that area of work is no longer available to that nanny.

1. Substitute Teaching

If you can memorize lots of cocktail recipes, if you have an outgoing personality and a steady hand, and if you’re willing to cut people off if needed, this could be a fit for you. Your best bet might be starting out tending bar for people you know and then building a network of referrals.
Some high-end clothing stores offer personal shopper services as well. These positions might be a little less “personal,” as they might be a one-day relationship. But the concept is the same.
Security guards who carry weapons require special training and weapons licensing, and is an entirely different job pursuit, perhaps not as well-suited to a retirement job.
Many people reach so-called retirement age and are in no way done with being productive. Many continue in freelance jobs and part-time gigs, whether in a brick-and mortar setting, from home, or even outdoors.

2. School Support

A part-time bookkeeper job often requires simple financial recordkeeping or upkeep of other financial records. Part-time bookkeepers are usually former accountants or have experience as a bookkeeper. They may be asked to track invoices, but most companies use financial services for paychecks.
You have a good head for numbers. You are in charge of your own finances, and you perhaps worked in an accounting role at a previous job.

3. Tutoring

While “retirement income’’ or “retirement job” might seem like oxymorons, they are a more reasonable pursuit today than in years past due to advancing life expectancies and improved health among older citizens.
Depending on the particulars of the job, a commercial driver’s license might be required. Different states have different laws regarding licensing for shuttle bus drivers. A different license might be required if the bus holds a certain number of people or is a particular weight. Your state motor vehicle website will tell you what’s required in your state, and any potential employer will know, too.
Freelance bartending doesn’t require bartending school and can earn you good money working at large events or small, private parties. Hourly pay for freelance bartenders can be anywhere from to even before tips.

A senior woman drives a school bus.
Getty Images

4. School Bus Driver

According to Indeed, the average hourly pay for a freelance writer is a bit over , but you are often paid by assignment or by word, so the pay varies. If you have knowledge in certain topics like science and medicine, the pay can be higher.
As of this writing, Ziprecruiter showed more than 34,000 virtual assistant jobs, suggesting that a virtual assistant could make up to ,000 a year, depending on the work required.
Pay is often dependent on the age of the players and the competitive level of the organization, but officials are likely to make at least per game. At higher levels where certification is required, you can earn 0 per game.

5. Shuttle Bus Driver

There are dozens of different types of shuttle bus driver jobs. Most hotels have shuttles to and from airports. Senior citizen homes, churches and community centers often offer shuttles to shopping areas or grocery stores. Hourly pay for shuttle bus drivers can average above per hour, and that’s not including tips from satisfied riders. Like school bus drivers, shuttle bus drivers have regular hours.
Source: thepennyhoarder.com

6. Conducting Tours

Most of the examples here require your physical presence on-site, but there are remote jobs, too, such as virtual assistant and customer service work that can be done from the comfort of your home.
Child care might be a bit of a political football these days, but rarely has it been more necessary. Single parents or two-parent families that require or want two incomes are likely to need child care, and that could take the form of a nanny or frequent babysitter.
These positions can be part- or full-time, and they pay well. So if you plan to collect Social Security benefits, make sure to check how your wage impacts your benefits.
Many seasonal jobs are defined by the weather, which is defined by the time of year and the climate where you live. Seasonal jobs are popular, never go out of style (except when the season changes), and can actually be a fun job to look forward to.
Most school districts have lenient requirements for substitute teachers, often requiring just a bachelor’s degree with no teaching experience.
Craigslist or neighborhood job sites are great ways to search for these positions, but your best bet is to work with your personal network. Let people know that you would be willing to work as a nanny or frequent babysitter, and, with the proper recommendation, you could have a very gratifying retirement job.

7. Patient Advocate

The job of a patient advocate is to assist someone who is struggling to cope with the healthcare system. A patient advocate deals with paperwork and appointments, and communicates with healthcare providers to get information on diagnosis, treatment and followup procedures.
As such, typical hourly pay is as a call center representative.
Personal shoppers who go after groceries or staples are likely to make typical hourly pay of to . Those who work for a service are likely on a wage or salary determined by the service rather than by the client.
Being a patient advocate does not require any particular educational degree, but it is possible to become certified in this role.

An elderly man babysits two girls. He plays guitar on the couch while the two of them listen to him play.
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8. Child Care Provider

The job is likely to include more than just driving, however. You may be asked to supervise students on the bus, and you may be called upon to discipline rowdy students or those who are making the trip unsafe. A tolerance for children of all ages is probably an important requirement.
If you have an advance degree, you may also qualify to be an adjunct instructor at a community college or four-year university.
Kent McDill is a veteran journalist who has specialized in personal finance topics since 2013. He is a contributor to The Penny Hoarder.
Virtual assistants are independent contractors who offer business services virtually. Those services can include website management, website design, marketing assistance, social media postings, blog writing, email correspondence or any number of clerical duties that can be carried out with a computer and phone. This kind of work is often well-suited to flexible hours.
For between and an hour, you can earn money pet-sitting in a home or, if the pet happens to be a dog, you can walk the animal. Pet-sitting is a good job for retirees who want to work outdoors without a lot of physical requirements other than being able to walk while pulling or being pulled.
While there are occasional situations where someone needs a one-off writing assignment, freelance writer jobs often offer consistent, if sporadic, work. A retiree who can write could have a client for years. Check out this Penny Hoarder article on 18 places hiring freelance writers.

Looking for a fun part-time side gig? Here’s how you can earn money visiting theme parks as a Disney nanny.

9. Virtual Assistant

Any task that can be done virtually via computer is likely to be requested by a virtual assistant. Firms would rather pay a freelancer than an employee to do the work.
Pet sitter/walker is also a good line of work to get into because one job can lead to another. Pet owners tend to concentrate around each other, and they will give recommendations to other pet owners about a reliable person who can watch Fido or Fluffy while they are on vacation.
Ski resorts in the winter and water parks in the summer are two great examples of places that require seasonal employees. It is not necessary to be a ski instructor or a lifeguard, either. These places require assistance in areas outside of their main purpose: security, transportation, customer service. Even the National Park Service hires seasonal temps.
Businesses, organizations and sites that host tours come in many shapes and sizes, from historical sites to museums, from outdoor walking tours to behind-the-scene workplace tours. They can be an everyday part of a business or scheduled by appointment. What they all have in common? A tour leader.

10. Bookkeeper

The Penny Hoarder’s Work-From-Home Jobs Portal makes the remote-job hunt easy. Our journalists scour the web for the best gigs, vet the companies and aggregate the latest listings in one place.
Nannies are likely to make an hour on average. Babysitter earnings vary widely by affluence of the neighborhood. Check out The Penny Hoarder’s tips on how to get paid up to an hour babysitting.
While high-level programs require officials to get licensed or certified, lower-level and youth group programs require just a basic knowledge of the rules. Look around your community for sports leagues in need of umpires or referees.
A babysitter sits in a home with a child or children. A nanny is responsible for getting children to day care or other activities; they are a substitute parent in many cases.

11. Umpire and Referee

If you are going to house-sit the animal, you will likely get paid more for also keeping an eye on the property while the owner is away.
Substitute teachers have never been more valuable than today. Covid has increased the chances that a teacher might be out of the classroom either awaiting test results or recuperating. When that happens, their students need someone to teach — and that could be you.
Although freelance writers no longer provide articles — it’s called content now — freelance writing is a gig that can offer the freedom to accept the assignments you want. There are firms that will connect freelance writers to people or companies in need of blogs, resumes, cover letters, marketing content and more.
This is a good job for retirees who do not mind a bit of boredom.

A man walks a gaggle of dogs at his dog walking job.
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12. Pet Sitter and Dog Walker

If you are interested in online tutoring, there are many good paying gigs out there. Match your skills to the openings.
So let’s get to work, shall we?
To be successful, you need to be ready to deal with a room full of 20 or so children of varying ages. But it could pay off. School districts in Chicago, for example, pay as much as 0 a day for a full day of work.
This is a classic retirement job that gets you out of the house, allows you to have contact with neighbors, and lets you provide security and safety with another set of adult eyes on the children.

13. Freelance Writer

These jobs require knowledge about the subject and the ability to tell a good story — often while walking backwards.
Competitive sports programs need officials for their games. Baseball, basketball, soccer and football all have leagues at various ages that need officiating. Depending on where you live, the work can be constant. If you get certified for multiple sports, you can work all weekend long and often during the week.
Some stores hold hiring events in October to fill these positions, but they often continue searching for employees throughout the final three months of the year.
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14. Call Center Worker

Most schools are always looking for crossing guards, recess supervisors and other positions. A call to your local elementary, middle or high school could lead you to a good retirement job that would fit your schedule. Even better is searching online for jobs at your school district. This will give you a range of what’s out there.
Who even knows what “retired’’ means anymore?
This is a perfect retirement job if you have a sports background and the ability to withstand criticism.

A senior citizen bartender holds up a pint of beer.
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15. Freelance Bartender

Another idea for animal lovers is pet transporting. If you’ve got a reliable set of wheels and like to drive, getting pets from here to there from owners, maybe be the side gig for you.
Taking classes in CPR or other emergency response techniques, which offer certifications upon completion, can improve your chances of being hired.
Is it the shopping or the buying that you enjoy? If it’s the shopping, then you might consider becoming someone’s personal shopper.

16. Personal Shopper

As much as this is a remote job, it is definitely a people-person retirement job. You are likely to be talking to someone who is upset or unhappy, and you are the first line of communication for the company you are representing. You need to be capable of being friendly and helpful in the face of unpleasant conversation.
Tour guide is one of those jobs that, when you see someone doing it, you think, “Well, I could do that too!”
To be a personal grocery shopper, you probably need only have been in a grocery store from time to time. To be a high-end personal shopper, a knowledge of the fashion industry and current fashions is going to get you better clients.
Remember when you had a summer job as a teenager or a part-time job during your winter break from college? The same logic can work when you’re thinking about some extra retirement income.
The job title describes the job. You are given a shopping list and the means to make the purchase, and you chase after the items.
The responsibilities of a security guard depend on the needs of the company being guarded. There may be requirements that go beyond just being a presence, but the differences depend on the needs of the company.
As you browse these possible jobs for retirees, keep in mind one warning: If you are collecting Social Security, you can only earn a certain amount each month before your benefits are reduced.

Got what it takes to be a mystery shopper? We’ve rounded up four companies that are hiring retail sleuths. 

17. Security Guard

There are hundreds of tutoring companies in the U.S. who work with kids of all ages to enhance their school education or prepare for college entrance exams. If you sign up with one, they’ll match you with work and you won’t need to market yourself as a tutor.
You might have left the career you had in the 40-hour-a-week workforce. But now you don’t exactly want to be glued to your couch watching puppy videos. You want to be active, you want to work, and you want to make a little money to support your fun retirement plans.
Also included in seasonal work are holiday positions during the months of October-December. On-site customer service, truck unloading, shelving of new goods, and custodial services are among the positions for which big box stores are likely to need employees. For example in 2021, we tallied more than 1 million seasonal jobs at national retailers and delivery services.
The average salary for a part-time bookkeeper is around per hour.
This could be a dream job for someone who knows the topic well and likes to retell stories about history, natural science or architecture (among many other possibilities).

18. Seasonal Worker

The hourly pay for these companies ranges from about to . Requirements often are limited to a bachelor’s degree, although exam-prep work might require a recent ACT or SAT test score, or might require you to retake the exam for verbal or math instruction.
Tour guides make an average base salary of per hour. Plus, they are often offered tips by tour participants.
Certainly, many people already have personal shoppers and don’t know it. When they contact a grocery store and provide an itemized list of goods they want, someone does the “shopping,” and the items are then delivered.
If this appeals to you, don’t overlook a special area of knowledge you’ve developed during all those years in the workplace. Know a lot about the manufacturing industry? Maybe you’re just the person to lead tours at a cheese factory.
Writing skills rarely diminish, but the requirements for writing change over time. A knowledge of search engine optimization (SEO) is going to open more doors. Many jobs that use job search websites like Indeed ask for candidates to take a writing test, but many of those are simple grammar or proofreading tests.

Pro Tip
There are plenty of ways to bring in some extra money to augment pension, social security, or other retirement funds. We’ve rounded up 18 ideas for good jobs for retirees that offer part-time opportunities, flexible hours, or both.

Just to be clear, we are talking about taking calls from customers, not making calls. A call center representative answers incoming calls from customers or potential customers and either answers questions or sends the caller to someone else who can answer.
Advocates might also be asked to work with insurance companies to understand coverage and costs. Many are asked to help a client obtain assistance with financial or legal issues. The range of duties can be as varied as the patient’s needs.

Dear Penny: Will My Husband’s Bad Health Choices Drain My Life’s Savings?

Dear Penny,

My spouse suffered from a stroke three years ago. He is unable to work and is receiving Social Security and is very noncompliant about his health. I am currently and have been the breadwinner for this family. 

My concern is that he is going to financially take everything I have saved and worked hard for with his consistent medical expenses. I fear he could end up in a nursing home. 

I have thought about divorce, but I know he would take half of my retirement. I am 62, and I hope to be able to retire at 65. How can I protect my retirement from the possible nursing home and medical expenses? 

-T.

Dear T.,

Watching your spouse jeopardize his health and risk your future in the process has got to be agonizing. Unfortunately, the threat of unmanageable medical bills is far too common since Medicare only covers the first 100 days of skilled nursing care.

Paying for a nursing home can quickly erase a lifetime’s worth of savings. The average cost of a semi-private room in a skilled nursing facility is over $7,700 per month, according to Genworth’s 2020 Cost of Care survey. Eventually, Medicaid will kick in — but only after someone has depleted almost all of what’s called countable assets, which include things like retirement accounts and other investments, cash, bank accounts and homes that aren’t used as a primary residence.



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When one spouse needs Medicaid but the other doesn’t, the non-applicant spouse can typically keep no more than $137,400 of countable assets. That’s not much if you’re expecting a long retirement.

But you do have options for preserving the money you’ve worked hard for over the years. It’s essential that you consult with an elder care attorney. Medicaid planning is extraordinarily complex, and the laws vary significantly by state. You can use the National Academy of Elder Law Attorneys database to search for an attorney near you.

You’re correct in that if you divorced, your husband would probably be entitled to part of your retirement. But most attorneys don’t recommend getting divorced solely to qualify one spouse for Medicaid for a host of reasons that are too complicated to delve into here.

One option you should discuss with an attorney is a Medicaid-compliant annuity. In a nutshell, Medicaid considers the income of the spouse who’s applying for coverage, but the other spouse’s income is off-limits. A Medicaid-compliant annuity takes part of your assets and converts it into a fixed income stream. The payments are based on your life expectancy, calculated according to Social Security’s life expectancy table.

For simplicity’s sake, let’s say you have $257,400 in countable assets, which would put you $120,000 above Medicaid’s threshold. You use that $120,000 to buy an annuity. If your life expectancy is 10 years, you’d immediately start to get payments of $1,000 a month, or $12,000 annually, for the next 10 years.

The insurance company makes its money by investing your principal. It’s a good tool for married couples when only one spouse needs care because, remember, the income of the other spouse isn’t used for Medicaid eligibility.

There are many rules an annuity has to follow to be considered Medicaid compliant. For example, it has to be a single premium immediate annuity, meaning you buy it in a lump sum and the payments start right away. If you’d opt to go this route, it’s important to look specifically for a Medicaid compliant annuity. Annuities advertised as “Medicaid-friendly” often don’t meet all the rules.

If you have debt, you could also use part of your assets to pay it off so you can keep your expenses minimal in retirement. Paying off a mortgage balance, a personal car loan or a credit card balance generally won’t violate Medicaid’s rules. If the two of you own your home, there’s no limit on your home equity as long as you continue to reside there.

You could have other options depending on your state. For instance, if you live in Florida or New York, you may be able to use a spousal refusal strategy, where you essentially sign a written statement refusing to contribute to the cost of your husband’s care.

These are just a few strategies that may be possible in the event that your husband needs long-term care. However, I can’t stress how important it is to consult with an experienced attorney about how to protect your assets. You may not need to take any action right away. But just knowing what options you have will set your mind at ease.

Robin Hartill is a certified financial planner and a senior writer at The Penny Hoarder. Send your tricky money questions to [email protected].

This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.

Source: thepennyhoarder.com