The Safest Place in Your Apartment During a Tornado

Tornadoes are no joke. With winds that can top 250 miles per hour, these storms can clear a path a mile wide and 50 miles long. Emerging from afternoon thunderstorms, tornadoes usually include hail and high winds. This is why you need to take cover when the warning siren goes off.

The average alert time for a tornado is 13 minutes, but there are environmental clues one is on its way. The sky transforms into a dark, greenish mass and begins to roar like an oncoming train.

Tornadoes can happen anywhere

Tornadoes occur all over the world, but, “In terms of absolute tornado counts, the United States leads the list, with an average of over 1,000 tornadoes recorded each year,” according to the National Centers for Environmental Information.

The U.S. experiences tornadoes all over the country, but one particular area gets hit the hardest. Known as Tornado Alley, the area covers South Dakota, Nebraska, Kansas, Oklahoma, Northern Texas and Eastern Colorado.

tornado alley map

Source: Accuweather

Whether you live in an area where tornadoes are common or not, it’s important to know how to stay safe in your apartment. Just as you create a plan for many emergency situations, know where to go in your apartment during these destructive storms.

Staying safe in an apartment building

On average, tornadoes move at speeds of about 10-20 miles per hour. They rarely travel more than six miles, which means they can damage a whole section of town. For that reason, if a tornado is in your area, seek shelter.

Basement

While basements are not an option in all apartment buildings, get low if you can during a tornado. Heading to the basement or even the sub-level of a parking garage offers the most insulation against the weather.

If your building doesn’t have a basement, try to get to the lowest floor if you can, regardless of whether or not it’s underground.

Interior rooms

The next safest option during a tornado is any area fully-inside the building. This means no outside walls. Under a stairwell, an interior hallway or even a room within your apartment can work. Make sure there are no windows.

Crouch down as low as you can get with your face down. Cover your head with your hands for extra protection or bring in a bike helmet to wear during the storm. Because of your location, there’s still a chance for debris to fall, so protecting your head is important.

Bathroom

Even if they have an exterior wall or windows, bathrooms are safe because the thick pipes inside the walls insulate you during a tornado. Climb into the bathtub if you have one and bring in your bed’s mattress to serve as a cover.

Closet

These are usually interior rooms by design, making closets a good choice to ride out a tornado. Pull your clothes off their hangers and grab any bedding from the shelves to insulate yourself. Don’t forget to close the closet door for even more protection.

tornado

Avoid dangerous areas

Tornadoes kill about 80 people each year, according to John Roach at AccuWeather. There was a decrease in tornado fatalities in 2018, with only 10 Americans dying. This is the lowest number since record-keeping started in 1875.

Yet, people still lose their lives to these dangerous storms. While knowing the safest places to be in your apartment during a tornado, you should also know what areas to avoid.

Windows

With gusting winds strong enough to shatter glass, windows become dangerous during a tornado. Even worse, once a window breaks, all kinds of debris can blow inside.

If you can’t stay completely clear from windows during a tornado, do your best to block them and protect yourself. If you can, duct tape a blanket over the window or slide a big piece of furniture in front to keep glass out of your apartment.

Heavy objects

While it may seem like a good idea to slide under your bed or inch behind a heavy dresser for protection during a tornado, it’s not. These pieces of furniture can shift during a storm or even fall through the floor. You don’t want to get pinned under or against something so heavy you can’t move.

Preparing for a tornado

If you live in an area where tornado warnings are common, consider creating a tornado evacuation kit to have on hand. These can include items you’d need to safely and easily exit your apartment after a tornado passes, such as:

  • Portable radio
  • Flashlight
  • Extra batteries
  • Cell phone charger
  • Bottled water
  • Spare set of car and apartment keys
  • Photocopy of your driver’s license
  • Cash

Having these items ready can make it easier to evacuate your building after the storm.

Remaining safe after the tornado passes

Being safe doesn’t stop once a tornado passes. Dealing with the aftermath of this type of storm includes new dangers. Make sure to watch out for fallen or exposed utility lines, downed trees or limbs and debris.

Exercise extreme caution when leaving your apartment building. If enough damage occurs, you may have to stay out of your apartment. You may not see the dangers, so it’s important to wait for an official word before reentering. When you can, take pictures of any damage to your own property since you’ll most likely have to file an insurance claim.

Preparing for the unexpected such as weather, fire or even flood means having the right supplies and the best information on how to stay safe.

The post The Safest Place in Your Apartment During a Tornado appeared first on Apartment Living Tips – Apartment Tips from ApartmentGuide.com.

Source: apartmentguide.com

What is a Health Savings Account (HSA)?

A Health Savings Account (HSA) is a convenient way to store funds specifically for medical expenses. If you qualify for an HSA, you will get to enjoy a few tax advantages as well. While this might sound like an ideal setup, not everyone is eligible for a health savings account. To qualify for a health savings account, you must be enrolled in a high-deductible health insurance plan (HDHP). The details of these plans are revised every year by the Internal Service Revenue (IRS), which sets the bar for:

  • The minimum deductible a plan must have to be considered a HDHP.
  • The maximum amount that a customer who purchases a plan is able to spend out-of-pocket.

The benefits of a health savings account

Here are some of the key advantages of having a health savings account:

  • It covers a large variety of medical expenses: There are many different kinds of medical expenses that are eligible, such as medical, dental and mental health services.
  • Pretty much anyone can make contributions: Contributions to your health savings account don’t have to be made by you or your spouse. Employers, relatives, friends or anyone who would like to contribute to your account can do so. There are limits, however. For example, in 2019, the limit for individuals was $3,500 and $7,000 for families.
  • Pre-tax contributions: Since contributions are generally made at your employer pre-taxes, they are not considered to be part of your gross income and are not federally taxed. This is usually the same case when it comes to state level taxes as well.
  • After-tax contributions are tax-deductible: Any contributions made after taxes are deductible from your gross income on your tax return. Doing so minimizes the amount you would owe on taxes for that year.
  • Tax-free withdrawals: You can withdrawal money from your account for approved health care costs without having to worry about federal taxes. Most states do not tax, either.
  • Annual rollover: Any unused HSA funds that are left over by the end of the year get rolled over to the following year.
  • Portability: Even if you change health insurance plans, employers, or retire, the money in your health savings account will continue to be available for qualifying health care expenses.
  • Having a health savings account is convenient: Most of the time, you will receive a debit card that is connected to your health savings account. This way, you can use your debit card to start paying for eligible expenses and prescription drugs on the spot.

The drawbacks to having a health savings account

While there are many advantages to having a health savings account, there are a few things to consider. For one, in order to qualify for an HSA, you must hold a high-deductible health insurance plan. The tax benefits might entice you to purposely sign up for insurance coverage under one of these health plans but think before doing this. Here are some of the disadvantages to having a health savings account:

  • The High-Deductible Health Plan: These types of health plans can end up being a lot more expensive in the long run, even with an HSA. If you have other options for health insurance that offer lower deductible, definitely consider those and don’t only choose a High-Deductible plan so that you can open an HSA.
  • You need to stay on top of your spending: If you have an HSA, you need to be willing to hold yourself responsible for recordkeeping. Keep track of all of your receipts so that you can prove you spent your HSA funds on eligible expenses.
  • Taxes and penalties: Using money from your HSA on other expenses that do not qualify as eligible health care expenses could result in you owing taxes. If you do this before the age of 65, you will have to pay taxes with a 20% penalty tacked on. If you are 65 or older, you will be responsible for paying taxes, but the penalty gets waived.
  • Fees: Sometimes, health savings accounts will charge additional fees, either per month or per transaction. Check with your HSA institution for more information on extra fees.

How an HSA works

In many cases, if your employer offers high-deductible health plans, they probably offer health savings accounts as well. Talk to your employer to find out what they offer. If your employer doesn’t offer HSAs, then you can sign up for a separate one through a different institution.

You get to decide how much you would like to contribute to your HSA annually, but keep in mind that you cannot exceed the HSA contribution limit. Once you are set up with an account, you will either receive a debit card or a series of checks that are linked to your HSA. Right away, you will be able to use the funds in your account for:

  • Deductibles
  • Copays
  • Coinsurance
  • Other eligible health care expenses that your insurance does not cover.

Generally, you cannot use HSA funds to pay your insurance premiums.  HSAs are not the same as flexible spending accounts, because HSAs rollover. Once you turn 65, you are no longer eligible to make contributions to your account, but you can still use the available funds for eligible out-of-pocket expenses. If you use the funds for non-eligible expenses, you will owe taxes on these amounts.

Investment Opportunities

Another benefit of HSA that you may or may not have heard of is that you can invest the money in mutual funds and stocks. If this is something that you are interested in, seek advice from a financial advisor for more information.

What is a Health Savings Account (HSA)? is a post from Pocket Your Dollars.

Source: pocketyourdollars.com

How to Save Money for an Apartment

Whether you’re hoping to move out of your dorm, upgrade your current space, or finally live roommate-free for the first time—the financial logistics of renting an apartment can be overwhelming. The good news is, you probably can afford an apartment as long as you know how to save. When you budget efficiently, the cost of […]

The post How to Save Money for an Apartment appeared first on Apartment Life.

Source: blog.apartmentsearch.com

Does Renters Insurance Cover Your Car?

Auto and renters insurance may seem as if they overlap a bit, but when you compare the two different types of policies, the differences start to stand out. Car and renters insurance actually work hand-in-hand, with each providing unique coverage for your car and belongings. Auto insurance covers any damage that occurs to your car […]

The post Does Renters Insurance Cover Your Car? appeared first on The Simple Dollar.

Source: thesimpledollar.com

NYC Noise Complaints Increase 279% in Just 4 Months

Even Americans who haven’t visited know that New York City never sleeps. Endless streams of people on the street and taxi cabs clogging the roadways are just part of the ceaseless movement in the city. With a population nearing nine million people, New York City always has something going on within its five boroughs.

With all the commotion, it’s safe to say that New York City could be one of the loudest cities on earth. However, it seems that New Yorkers are getting tired of the noise more than usual this year. From COVID-19 lockdowns to widespread protests, New York City has become quite chaotic lately — is this the cause of the increase in noise complaints?

Methodology

We analyzed data from NYC OpenData, which includes a database of 311 calls placed within the city. We looked at noise complaint calls placed from February 1, 2020, to June 30, 2020, and from February 1, 2019, to June 30, 2019.

We also used available population estimates from the U.S. Census Bureau to weigh noise complaint call data in relation to the population of each New York borough: The Bronx, Brooklyn, Manhattan, Queens and Staten Island.

Noise complaints rise 106% in one year

a line graph showing an increase in new york city noise complaints from 2019 to 2020

It’s no secret that New York City is a noisy place –– the bustling streets and never-ending traffic jams create quite the cacophony of sound. However, it seems like residents are complaining about noise more than ever, especially since last year. Total complaints more than doubled from this time last year, increasing by 106 percent. 

Here’s a breakdown of the data between 2019 and 2020: 

Month 2019 2020 % Change
February 26,839 27,781 3.51%
March 33,567 37,396 11.41%
April 39,059 39,373 0.80%
May 40,339 77,628 92.44%
June 58,845 105,240 78.84%

Noise complaints increased by over 106 percent from 2019 to 2020 (within the measured time period). The city also saw a 97 percent increase in complaints from the beginning of April to the end of May 2020, marking the largest jump in noise complaints so far this year. These increases paint a striking picture of the considerable changes in city life over the last several months.

COVID-19, lockdowns and protests in NYC

an illustration showing a 279% increase in total noise complaints in New York City from February to June 2020

The beginning of March marked the start of quarantines, lockdowns and panic over the COVID-19 pandemic. With such a huge population density (27,000 people per square mile), New York City quickly fell into chaos as the virus spread through the city –– as of June 30, there were over 212,000 confirmed cases of COVID-19 in New York City alone.

Quarantines and lockdowns within the city meant millions of people began working from home. With so many now at home from 9 a.m. to 5 p.m., it’s no surprise that New Yorkers had more to complain about when it comes to noisy neighbors and the sounds of city traffic. The data reflects this timeline perfectly, showing a difference of nearly 10,000 additional complaints logged in March (compared to February).

The end of May 2020 came with a new noise in New York City: protests. This unrest was widespread across New York City, with protests in all five boroughs. The sheer volume of these protests can be seen clearly in the data we analyzed. From the beginning of May to the end of June, noise complaints increased by 79 percent. Additionally, complaints of “loud talking” more than doubled from the beginning of April to the end of May, about the time when the protests began.

Battle of the boroughs: Who complains the most in NYC?

Despite having a smaller population than other boroughs, The Bronx has logged the most noise complaints in 2020 so far –– a total of 81,869 complaints logged from February to June.

Because populations differ across the five boroughs, we divided each borough’s total complaints by its respective total population to find comparable percentages.

Borough-specific data is below:

  • The Bronx: 81,869 total complaints (6 percent of the population)
  • Manhattan: 74,661 total complaints (5 percent of the population)
  • Brooklyn: 73,899 total complaints (3 percent of the population)
  • Queens: 49,469 total complaints (2 percent of the population)
  • Staten Island: 6,635 total complaints (1 percent of the population)

A borough rich in local culture, The Bronx has been called the birthplace of hip-hop and salsa, is home to Yankee Stadium and boasts one of the most diverse populations in the city. This diversity could be related to a higher volume of noise complaints, especially since a 2017 study published in the Environmental Health Perspectives Journal determined that neighborhoods with higher poverty rates and larger minority populations experience more noise pollution than other neighborhoods.

New York City explodes with fireworks

From the beginning of April to the end of June this year, complaints about illegal fireworks increased by a staggering 283,595 percent –– only 19 complaints were logged in April, while complaints in June totaled 53,902. Brooklyn is seeing the majority of complaints about fireworks, with approximately one in three complaints originating from the largest of the boroughs.

Fireworks are the second most complained-about noise in New York City from February to June, with loud music and parties taking the first place prize for the most complained-about noise (157,823 total complaints during this time period). With this in mind, it’s important to note that 311 OpenData categorizes these complaints in their own section, rather than grouping them with other noise complaints.

Here is a breakdown of the noises New Yorkers complained about the most in June 2020: 

  • Loud music and parties: 73,238 complaints
  • Fireworks: 53,902 complaints
  • Traffic: 10,795 complaints
  • Loud talking: 7,213 complaints
  • Construction: 2,014 complaints

While summer fireworks in New York City have always been present, this year is definitely unique. The unusual volume of fireworks has raised many conspiracy theories among New Yorkers, with some claiming the government is using the fireworks to desensitize the public to “war-like sounds.” Others claim the police are using the fireworks as a punishment for the recent protests, while some say New Yorkers are simply bored in quarantine.

Whatever the cause of the fireworks, they are wreaking havoc across the city. Countless residents have been hospitalized with firework-related injuries and the city government has created a police taskforce to curb illegal firework activity, with police donning riot gear and arresting anyone believed to be involved.

New York City has always been loud, but 2020 seems to have turned up the volume in the city. Noise complaints are at an all-time high with no end in sight. If you’re living in New York City this summer, there are easy ways to soundproof your home.

Sources

U.S. Census Bureau | New York City OpenData: 1, 2 | Gothamist | The Atlantic

The post NYC Noise Complaints Increase 279% in Just 4 Months appeared first on Apartment Living Tips – Apartment Tips from ApartmentGuide.com.

Source: apartmentguide.com

How to Find Affordable Life Insurance

Life insurance can be expensive and if it’s essential those high costs can leave a nasty taste in your mouth. You may wonder if it’s worth purchasing a policy at all, which could place your family in jeopardy as they won’t have the cover they need when you pass. 

However, there are a few ways you can bring those costs down and get affordable life insurance. So, don’t despair, and take a look at these top tips for cheap life insurance.

How are Life Insurance Payouts and Premiums Judged?

Insurance underwriters set your premiums and your payout based on the likelihood that you will die during the term. It sounds pretty morbid, but these are for-profit companies we’re talking about and when death is your only liability, there’s no time for gentility. 

It’s something that frustrates everyone who has ever been quoted high premiums, but it’s important to see things from the perspective of the underwriter. If you’re 100 pounds over your ideal weight, your risk of heart disease, cancer, and countless other diseases increases, and you become more of a liability. 

It doesn’t matter how much you convince them that you’re on a diet and will lose all of that weight eventually—as things stand right now, you’re more of a liability than someone who weighs 100 pounds less.

Of course, it’s possible to be 140 pounds and unhealthy, just as it’s possible to be 240 pounds and healthy, and this is an argument that many applicants make. But those are the exceptions. The oldest woman ever smoked until the day she died and made it halfway through her 122nd year, and everyone knows of at least one smoker that continued the habit well into their 70th and 80th year, seemingly unaffected. 

However, the average smoker will die 10 years before their non-smoking counterpart and their risk of contracting a host of diseases increases exponentially for every decade that they stick with the habit. Should a life insurance company dismiss your habit just because of a 122-year-old French woman? Of course not. 

These are statistics and probabilities; they focus on the most likely and the most common. By their very nature, there will always be exceptions and outliers. A life insurance company doesn’t care about any of these because as long as they focus on the events that are most likely (obese policyholders and smokers will die young; preexisting medical conditions are more likely to reoccur than if they didn’t exist at all) the premiums will exceed the payouts and they will turn a profit. 

Start Early

The sooner you apply for life insurance, the better your chances of getting a high payout and a low premium. Age is one of the biggest factors in determining your mortality risk. A 20-year-old has a high chance of surviving a 30-year-term, but for every additional year, those odds decline and by the time they hit 55, the odds are no longer in their favor.

Starting early doesn’t just protect your loved ones if you die before your time, it also gives you more options. This is when whole life insurance policies are at their most beneficial. These will payout regardless, even if you live to be 100. The life insurance company will still benefit, however, because many of these policies either lapse because of non-payment (a lot can happen in those 80 years) or the policyholder takes the cash value.

They’re like a life insurance policy and saving account bundled into one, but they become less viable as you age.

Make Big Changes

You probably knew this tip was going to be here, but it’s worth mentioning: If you smoke, stop; if you’re obese, lose weight. We can’t stress enough how much of a difference these things will make to your life insurance application.

If you’re a smoker and you’re obese, you’re a massive liability. Statistically speaking, you’ll be beating the odds if you make it to your 60th year, which means a 30-year term stops being a viable option when you’re just 31! If that’s not enough to scare you, then there’s nothing we can say that will.

By quitting cigarettes and dropping a few dozen pounds, you improve your chances of living a long and full life, which, in turn, means you’ll get cheaper life insurance premiums.

And these are not the only changes you should consider making. Many applicants fail to calculate just how much of a liability they become when they partake in extreme sports and activities such as base jumping, parkour, sky diving, and rock climbing. Some of these are riskier than others, but in all cases, the underwriter will compare them to the averages to determine your likelihood of dying young.

Roughly 10 skydivers will die for every 1 million that jump on a regular basis. However, more than 40 times as many will die from base jumping and you’re 30 times more likely to die from extreme mountaineering than you are from base jumping. 

Some of these are less risky than you might think. For instance, you’re twice as likely to die from walking than you are from horseback riding, as the former puts you at risk of major pedestrian accidents. 

You’re also more likely to die from getting out of bed aged 45 than you are from SCUBA diving. So, assess the risks, try to look at your situation from the underwriter’s perspective, and make changes where necessary without giving up all the things that you enjoy.

Wait

You can apply for life insurance as soon as you lose weight or give up risky and dangerous activities. You can reap the benefits straight away when you do this, but the same can’t be said for everything. 

Smoking is a great example of this. If you quit smoking today, you will need to wait at least 12 months before that has an impact on your life insurance policy. It only makes sense when you consider the majority of short-term cessations will result in relapse. 

The underwriter also wants to protect their bottom line, because you won’t start feeling the health benefits until several months have passed and before that time elapses, you’re still a high risk for many diseases and conditions.

Look for Group Life Insurance 

If you can’t get life insurance by applying directly, you may be offered it through an employer. Group life insurance is offered to large groups of people and is typically provided by employers.

You probably won’t get the same extensive cover, but you will get some cover, and this is a great alternative if you’re struggling to seal the deal yourself.

Only Buy What You Need

It’s tempting to get a big payout when you’re buying life insurance as that payout can then provide a good life for your loved ones. But life insurance shouldn’t be like winning the lottery. It’s not designed to allow them to quit work and spend the rest of their lives sipping champagne on Mediterranean cruises.

The payout should cover all of their needs for several years, while also repaying any debts that you (or your loved ones) have. If you have a mortgage, it can also go towards repaying this.

Many life insurance experts recommend that you stick with the absolute basics in situations where the remaining family members can still support themselves. For instance, let’s suppose that you’re a 50-year man in relatively good health. You earn roughly the same money as your wife, but she’s 10 years younger than you and you also have a son at college and a mortgage with $50,000 left to pay.

In this case, the payout should be at least $50,000, plus the size of remaining debts. However, you don’t need to include all debts in this. Some debts, including all federal student loans, will die with you, which means your son or your wife won’t be burdened with them. For example, if you cosigned on a $20,000 federal student loan and also have $10,000 in joint credit card debt, a death benefit of $60,000 will be enough.

That way, your wife can clear the mortgage and debt in full, thus reducing monthly liabilities and putting more money in her pocket at the end of the money. If she ever faces a financial crisis, such as the loss of a job, she’ll have a fully paid house to use as collateral and can take loans and equity loans as needed.

This is the best way to provide for your family after your death without crippling your finances in the present.

And Finally, Take Your Time

The sooner you apply, the better. But that applies to years and not weeks, so don’t feel like you need to rush. If you’re not sure about the process and need a little advice, spend some more time reading through articles and guides and speaking with current policyholders.

Providing yourself with a little extra shopping time will also make it easier to compare and to find the best life insurance rates and the best payouts based on your specific budget and situation.

How to Find Affordable Life Insurance is a post from Pocket Your Dollars.

Source: pocketyourdollars.com

How Much Life Insurance Do I Really Need?

Since it doesn’t have an immediate benefit – like health or auto insurance – life insurance may be the most underestimated insurance type there is. But if you die, life insurance will likely be the single most important policy type you’ve ever purchased.

And that’s why you have to get it right. Not only do you need a policy, but you need the right amount of coverage. Buying a flat amount of coverage and hoping for the best isn’t a strategy. There are specific numbers that go into determining how much life insurance you need. There are even numbers that can reduce the amount you need.

Calculate what that number is, compare it with any life insurance you currently have, and get busy buying a policy to cover the amount you don’t have. I’ll not only show you how much that is, but also where you can get the lowest cost life insurance possible.

How to Calculate How Much Life Insurance You Need

To make it easier for you to find out how much life insurance you need we’re providing the life insurance calculator below. Just input the information requested, and the calculator will do all the number crunching for you. You’ll know exactly how much coverage you’ll need, which will prepare you for the next step in the process – getting quotes from top life insurance companies.

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Now that you have an idea how much life insurance you need, the next step is to get quotes from top life insurance companies for their best life insurance products. And the best way to get the most coverage for the lowest premium is by getting quotes from several companies. Use the quote tool below from our life insurance partner to get those offers:

What to Consider when Purchasing Life Insurance

To answer the question of how much life insurance do I need, you’ll first need to break down the factors that will give you the magic number. You can use a rule of thumb, like the popularly quoted buy 10 times your annual income, but that’s little more than a rough estimate. If you use that as your guide, you may even end up paying for more coverage than you need, or worse – not have enough insurance.

Let’s take a look at the various components that will give you the right number for your policy.

Your Basic Living Expenses

If you’re not using budget software to track this number, a good strategy is to review and summarize your expenses for the past 12 months.

When you come up with that number, the next step is to multiply it by the number of years you want your life insurance policy to cover.

For example, let’s say your youngest child is five years old and you want to be able to provide for your family for at least 20 years. If the cost of your basic living expenses is $40,000 per year, you’ll need $800,000 over 20 years.

Now if your spouse is also employed, and likely to remain so after your death, you can subtract his or her contribution to your annual expenses.

If your spouse contributes $20,000 per year to your basic living expenses, you can cut the life insurance requirement in half, allowing $400,000 to cover basic living expenses.

But in considering whether or not your spouse will continue to work after your death, you’ll need to evaluate if that’s even possible. For example, if you have young, dependent children, your spouse may need to quit work and take care of them.

Alternatively, if you have a non-working spouse, there’ll be no contribution from his or her income toward basic living expenses.

In either case, your need to cover basic living expenses will go back up to $800,000.

Providing for Your Dependents

It may be tempting to assume your dependents will be provided for out of the insurance amount you determine for basic living expenses. But because children go through different life stages, there may be additional expenses.

The most obvious is providing for college education. With the average cost of in-state college tuition currently running at $9,410 per year, you may want to gross that up to $20,000 to allow for books, fees, room and board and other costs. You can estimate a four-year cost of $80,000 per child. If you have two children, you’ll need to provide $160,000 out of life insurance.

Now it may be possible that one or more of your children may qualify for a scholarship or grant, but that should never be assumed. If anything, college costs will be higher by the time your children are enrolled, and any additional funds you budget for will be quickly used up.

Life insurance is an opportunity to make sure that even if you aren’t around to provide for your children’s education, they won’t need to take on crippling student loan debts to make it happen.

But apart from college, you may also need to provide extra life insurance coverage for childcare. If your spouse does work, and is expected to continue even after your death, care for your children will be necessary.

If childcare in your area costs $12,000 per year per child, and you currently have a nine-year-old and a 10-year-old, you’ll need to cover that cost for a total of five years, assuming childcare is no longer necessary by age 12. That will include three years for your nine-year-old and two years for your 10-year-old. It will require increasing your life insurance policy by $60,000 ($12,000 X five years).

Paying Off Debt

This is the easiest number to calculate since you can just pull the balances from your credit report.

The most obvious debt you’ll want paid off is your mortgage. Since it’s probably the biggest single debt you have, getting it paid off upon your death will go a long way toward making your family’s financial life easier after you’re gone.

You may also consider paying off any car loans you or your spouse have. But you’ll only be paying off those loans that exist at the time of your death. It’s likely your spouse will need a new car loan in a few years. Use your best judgment on this one.

But an even more important loan to pay off is any student loan debt. Though federal student loans will be canceled upon your death, that’s not always true with private student loans. Unless you know for certain that your loan(s) will be canceled, it’s best to make an additional allowance to pay them off.

Credit cards are a difficult loan type to include in a life insurance policy. The reason is because of the revolving nature of credit card debt. If your death is preceded by an extended period of incapacitation your family may turn to credit cards to deal with uncovered medical expenses, income shortfalls, and even stress-related issues. An estimate may be the best you can do here.

Still another important category is business debts, if you have any. Most business debts require a personal guarantee on your part, and would be an obligation of your estate upon your death. If you have this kind of debt, you’ll want to provide for it to be paid off in your policy.

Covering Final Expenses

These are the most basic reasons to have life insurance, but in today’s high cost world, it’s probably one of the smallest components of your policy.

When we think of final expenses, funeral costs quickly come to mind. An average funeral can cost anywhere from $5,000 to $10,000, depending on individual preferences.

But funeral costs are hardly the only costs associated with total final expenses.

We’ve already mentioned uncovered medical costs. If you’re not going to include a provision for these elsewhere in your policy considerations, you’ll need to make a general estimate here. At a minimum, you should assume the full amount of the out-of-pocket costs on your health insurance plan.

But that’s just the starting point. There may be thousands of dollars in uncovered costs, due to special care that may be required if your death is preceded by an extended illness.

A ballpark estimate may be the best you can do.

Possible Reductions in the Amount of Life Insurance You Need

What’s that? Reductions in the amount of life insurance I need? It’s not as out-in-orbit as you may think – even though any life insurance agent worth his or her salt will do their best to ignore this entirely. But if you’re purchasing your own life insurance, you can and should take these into consideration. It’s one of the ways you can avoid buying more life insurance than you actually need.

What are some examples of possible reductions?

Current financial assets.

Let’s say you calculate you’ll need a life insurance policy for $1 million. But you currently have $300,000 in financial assets. Since those assets will be available to help provide for your family, you can deduct them from the amount of life insurance you’ll need.

Your spouse’s income.

We’ve already covered this in calculating your basic living expenses. But if you haven’t, you should still factor it into the equation, at least if your spouse is likely to continue working.

If you need a $1 million life insurance policy, but your spouse will contribute $25,000 per year (for 20 years) toward your basic living expenses, you’ll be able to cut your life insurance need in half.

But be careful here! Your spouse may need to either reduce his or her work schedule, or even quit entirely. Either outcome is a possibility for reasons you might not be able to imagine right now.

What About a Work Related Life Insurance Policy?

While it may be tempting to deduct the anticipated proceeds from a job-related life insurance policy from your personal policy, I urge extreme caution here.

The basic problem is employment related life insurance is not permanent life insurance. Between now and the time of your death, you could change jobs to one that offers a much smaller policy. You might even move into a new occupation that doesn’t provide life insurance at all.

There’s also the possibility your coverage may be terminated because of factors leading up to your death. For example, if you contract a terminal illness you may be forced to leave your job months or even years before your death. If so, you may lose your employer policy with your departure.

My advice is to consider a work policy as a bonus. If it’s there at the time of your death, great – your loved ones will have additional financial resources. But if it isn’t, you’ll be fully prepared with a right-sized private policy.

Example: Your Life Insurance Requirements

Let’s bring all these variables together and work an example that incorporates each factor.

Life insurance needs:

  • Basic living expenses – $40,000 per year for 20 years – $800,000
  • College education – $80,000 X 2 children – $160,000
  • Childcare – for two children for 5 years at $12,000 per year – $60,000
  • Payoff debt – mortgage ($250,000), student loans ($40,000), credit cards ($10,000) – $300,000
  • Final expenses – using a ballpark estimate – $30,000
  • Total gross insurance need – $1,350,000

Reductions in anticipated life insurance needs:

  • Current financial assets – $300,000
  • Spouse’s contribution toward living expenses – $20,000 per year for 20 years – $400,000
  • Total life insurance reductions – $700,000

Based on the above totals, by subtracting $700,000 in life insurance reductions from the gross insurance need of $1,350,000, leaves you with $650,000. At that amount, your family should be adequately provided for upon your death, and the amount you should consider for your life insurance policy.

Once again, if you have life insurance at work, think of it as a bonus only.

The Bottom Line

Once you know how much life insurance you need, it’s time to purchase a policy. Now is the best time to do that. Life insurance becomes more expensive as you get older, and if you develop a serious health condition, it may even be impossible to get. That’s why I have to emphasize that you act now.

Crunch the numbers to find out how much life insurance you need, then get quotes using the quote tool above. The sooner you do, the less expensive your policy will be.

The post How Much Life Insurance Do I Really Need? appeared first on Good Financial Cents®.

Source: goodfinancialcents.com

3 Things Rideshare and Delivery Drivers Should Know About Car Insurance

A woman drives her car.

Food delivery and ridesharing are great ways to earn extra income. The market for food delivery has increased as restaurants have had to adapt to COVID-19 precautions, and just about everyone could use some extra income as we continue to navigate life during a pandemic.

If you’re considering joining a food delivery or rideshare company as a driver, you need to be sure you have the right insurance coverage. If you’re in an accident, you want to be able to replace your car or fix it so you can keep working.

As you review your car insurance, here’s what you need to know:

You have a coverage gap

Rideshare and delivery companies offer some insurance coverage while you are on your way to pick up passengers or food and while you are transporting passengers or food. However, when you have your app on and are waiting to accept a delivery, neither your personal car insurance or your rideshare company offers coverage. 

If you are in an accident while you’re waiting to accept a job, you won’t have any insurance coverage. You’ll be on your own for covering the resulting costs and may have to deal with other issues.

Look for an insurance policy to cover the gaps

To protect yourself and cover this gap, you’ll want to purchase an additional policy or a policy that adds rideshare coverage to your personal policy. These policies and riders are commonly called rideshare insurance. However, they are commercial auto coverage policies that offer insurance coverage when you use your car for business.

Choose a reliable and highly rated insurer for your policy. Check the insurer’s financial strength to gauge the company’s financial stability and ability to make claims payments. Reading customer reviews can give you a sense of the customer experience with the insurer, which can also help you find a good company.

As you shop for policies or riders that can be added to your personal auto coverage, you can use companies like Policygenius to compare policies across multiple insurers. The ability to compare quotes and policies quickly and efficiently makes it easier to find a good deal. This can also be beneficial if you’re also shopping for personal auto insurance coverage.

Before you buy a policy, understand how it works:

  • What is the deductible? This is the amount you’ll pay before the insurer starts to pay for covered damage.
  • How much is the premium? This is the monthly fee you pay for insurance coverage.
  • Does the policy have a benefit maximum? This is the most an insurer will pay. Once this limit is reached, the rest of the expenses are your responsibility.
  • What coverage is offered—collision, liability, comprehensive, medical payments, income loss, etc.? Car insurance policies are highly customizable because you can choose how much and what kind of coverage to buy.

Car insurance requirements vary by state. Liability coverage for property damage and physical injury is most commonly required. Some states require additional coverage for uninsured or underinsured motorist insurance or Personal Injury Protection (PIP). PIP coverage offers coverage for lost wages according to your policy’s terms.

Making a claim for lost wages will depend on whether your state is an at-fault or no-fault state. You may need to file a claim with the other driver’s insurance, use your uninsured or underinsured motorist insurance, or PIP coverage.

Keep in mind that you typically have to have the same level of coverage on your personal insurance as you do with your rideshare coverage. Knowing the cost and kind of protection offered by your policy will help you find one and choose coverage that will meet your needs.

Communicate with your personal car insurance carrier

If you’re driving for hire and do not communicate that to your car insurance company, you could lose your coverage. Insurers can end your policy and no longer offer you coverage if you don’t communicate clearly about your car usage. 

While communicating and getting commercial auto coverage added to your policy can cost more, you’ll be better protected if you have the right coverage and won’t have to worry about your insurer rescinding the policy. Communicating with your car insurance company about how you’re using your car will ensure that you have the coverage you need, which will give you peace of mind and benefit you in the long run.

Set yourself up for success

Before you sign up with a food delivery or rideshare service, understand what coverage your company offers and where the coverage gap is. This will help you know what to look for as you evaluate rideshare or commercial auto insurance policies.

If you’re happy with your current auto insurance provider, start by asking them what they offer. You can also compare what your current insurer provides with what other insurers are offering to check that your company is competitive.

Purchasing insurance to cover the gap will give you peace of mind and financial protection if you’re in an accident. It will also protect your car, which is essential to your ability to work as a rideshare or food delivery driver.

The post 3 Things Rideshare and Delivery Drivers Should Know About Car Insurance appeared first on Credit.com.

Source: credit.com

How Much Does Long-Term Care Insurance Cost?

long-term care can help you or a loved one live comfortably well into their Golden Years

A 55-year-old can expect to pay a long-term care insurance premium of $2,050 per year on average, according to a 2019 price index survey of leading insurers conducted by the American Association for Long-Term Care Insurance (AALTC). That will cover $164,000 in benefits when the policyholder takes out the insurance and $386,500 at age 85. (Policies often include an inflation rider.) However, long-term care insurance costs vary widely, depending on factors like your age, health condition and the specific policies of your insurance carrier. The AALTC estimates that a single 55-year-old can pay around $1,325 to $2,550 a year for a policy. That’s why it’s important to shop around to find the best rates and terms. You should also speak with a financial advisor who can help you plan the future.

How Much Does Long-Term Care Insurance Cost?

The AALTC provides the following estimates of annual premiums based on its 2019 study of different long-term care insurance carriers.

Annual Premium Estimates Status Age Premium Single Male 55 $2,050 Single Female 55 $2,700 Couple 55 $3,050 (Combined cost)

Keep in mind, though, that these are only averages based on a pool of data gathered from leading insurance carriers. The costs of long-term care insurance can vary widely,  depending on several key factors. We explore some of these below.

Health: Some medical conditions will disqualify you from even being able to purchase a policy, including muscular dystrophy, cystic fibrosis and dementia. That’s because insurers will likely lose money on those policies. Generally, the healthier you are, the less likely you’ll ever need to file a claim – and so the lower your premium.

Age: In general, you’ll pay more in long-term care insurance if you take out a policy when you’re older, since you’re probably less healthy and you’re closer to needing the assistance the policy covers. This is why the AALTCI recommends you begin shopping for long-term care insurance between the ages of 52 of 64.

Marital status: When combined, premiums tend to be lower for married couples than they would be for individuals paying for a personal policy.

Gender: Because women tend to live longer than men and make claims more frequently than their male counter parts, women tend to pay more for insurance premiums. The AALTCI study showed that a single female pays an annual premium of $3,050 on average while the single man that age paid $2,050.

Carrier policies: Each insurance carrier sets its own rates and underwriting standards. In fact, costs for the same services can vary widely from one company to another. This is why you should gather quotes from various carriers. You can also work with an experienced long-term care insurance agent who can gather these for you and help you understand the differences between insurance policies. They can also help you determine the kind of coverage you’re likely to need, so you don’t over-insure.

Should I Get Long-Term Care Insurance?

Long-term care costs can climb high, so you'd want to start saving now.

The average 65-year-old today has a 70% chance of needing some kind of long-term care eventually, according to the Urban Institute and the U.S. Department of Health and Human Services. Of those who need it, most would use it for about two years, but around 20% would require it for more than five years.

The smart money, then, would prepare for this significant cost. To give you a sense of how much bills can run, below are the estimated annual costs of different types of long-term care services, according to Genworth Financial, which has been tracking them since 2004.

Estimated Annual Costs Type of Services Price Private room nursing home $102,000 Assisted living facility $48,612 Home care aide $52,624 Home care homemaker $51,480

What’s more, costs have been rising faster than even inflation. Genworth found that the average cost of home-care services increased about $892 annually each year between 2004 and 2019. The average cost for a private room in a nursing home jumped by about $2,468 each year during the same time period, currently putting the average cost of a semi-private room in a nursing home at $89,297 per year. As noted before, about 20% of Americans will require more than five years of care.

Unfortunately, with these costs, many retirement nest eggs will come up short. And contrary to popular belief, Medicare covers only limited medical costs, e.g., brief nursing home stays and narrow amounts of skilled nursing or rehabilitation services. The scope for Medicaid is even smaller. On average, it covers about 22 days of home care services if you meet very low income thresholds.

Of course, there’s no way of knowing how much long-term care coverage you’ll need. But knowing what long-term care insurance does and doesn’t cover is key to making sure you’re not over- or under-protected.

What Does Long-Term Care Insurance Cover?

Long-term health insurance typically covers services not provided for by regular health insurance. This can include assistance with completing daily tasks like eating, bathing and moving around. In the industry, these are known as activities of daily living (ADLs). Long-term care insurance policies generally would reimburse you for these services in such locations as:

  • Your home
  • Adult day care center
  • Assisted living facility
  • Nursing home

Some policies also cover care related to chronic medical conditions such as Alzheimer’s disease and other cognitive disorders.

But keep in mind that these are generalizations. There is no industry standard that sets ADL requirements for claim eligibility or what kinds of illnesses long-term care insurance will cover. Each insurance carrier makes its own rules.

So it’s essential to understand when coverage kicks in – and for how long. Policies used to provide coverage for life, but now most cap benefits at one to five years. If possible, some experts recommend extending the initial period when you are not compensated for costs (it’s often 90 days) in exchange for a longer period on the other end of receiving benefits. You also will want to know how premiums may increase over time and whether the cap on benefits will, too. Some carriers allow you to place an inflation rider that increases your daily benefit every year. That increase can be up to 3%.

How Does Long-Term Care Insurance Work?

After you apply for long-term care insurance, the insurer may request your medical records and ask you some questions about your health. You can choose the type of coverage you want, but the insurer must approve you.

When the company issues you a policy, you begin paying premiums every year. Once you qualify for benefits, which is often defined by not being able to perform a set number of ADLs, and the required waiting period has passed, you can file a claim. The insurance company then reviews your submitted medical records and may send a nurse to perform an evaluation before approving a payout. Once approved, you will be reimbursed for paid services, up to the cap on your policy.

Ideally, you’ll stay healthy and your long-term care needs will be minimal. Though your premiums will add up over time, this is one situation where you hope not to get your money’s worth. On the bright side, to lessen the hit to your wallet, the government may give you a tax break.

Tax Relief for Long-Term Care Premiums

If you don't lock in your long term care insurance cost when you are relatively healthy, it will only rise as you age and your health declines.

Some or all of the long-term care premiums you pay may be tax deductible at the federal and state level. But you must make these payments toward a tax-qualified insurance policy. Also, you must meet certain income thresholds.

Maximum Deductible Premium

Age Maximum Deduction 40 or under $420 41 to 50 $790 51 to 60 $1,580 61 to 70 $4,220 71 and over $5,220 How to Buy Long-Term Care Insurance

You can purchase long-term care insurance directly from carriers or through a sales agent. The agent can help you shop around for comparable rates. This professional can also help you understand how different policies work and what they offer.

Also, you may be able to get long-term care insurance through your employer. Some allow you to purchase policies at discounted group rates. However, you should get quotes from multiple insurance companies. In some cases, you may find better rates for more suitable policies that aren’t through your employer.

How to Calculate Your Long-Term Care Insurance Costs

Some websites such as Genworth Financial provide interactive calculators that can estimate what long-term care premiums may be like in your area. Prices and policies can vary, depending on the state.

Tips on Paying for Long-Term Care 

  • If you have a health savings account (HSA), you may want to start socking away more money in it for long-term care. Also called health IRAs, these plans allow your money to grow tax deferred. (But you have to have a high-deductible health plan to open an HSA). To find out more, check out our report on the best HSAs.
  • Don’t go it alone. A financial advisor can help you devise an insurance plan and figure out how you’re going to pay for it. If you are in the market to buy insurance now, some advisors are also licensed insurance agents. Use our matching tool to find the right advisor for you.

Photo credit: ©iStock.com/FangXiaNuo, ©iStock.com/tumsasedgars, ©iStock.com/syahrir maulana

The post How Much Does Long-Term Care Insurance Cost? appeared first on SmartAsset Blog.

Source: smartasset.com

What Health Insurance Doesn’t Cover: Your Guide

Insurance of any kind can be confusing, but when it comes to medical insurance, it’s really tricky to tell what’s covered and what isn’t. Whether you’re shopping around for a new plan or recently just got on a new health insurance plan, it’s good to know the ins and outs of your health insurance coverage before you end up with a large stack of medical bills that you can’t afford. In this article, we’ll discuss the things that medical insurance surprisingly doesn’t cover so that you can make better decisions about your medical expenses. 

What health insurance does cover

In accordance with the Affordable Care Act (ACA), the Health Insurance Marketplace must now cover a specific set of services at little or no out-of-pocket expense to you. They are also required to cover at least 10 essential health benefits. These essential health benefits (EHBs) include:

  • Ambulatory patient services
  • Emergency services
  • Hospitalization and surgery
  • Maternity and newborn healthcare
  • Mental health treatment and substance abuse disorders including counseling and psychiatric treatment
  • Pharmaceutical drugs
  • Rehabilitation services that provide care for those suffering from disabilities and injuries. 
  • Laboratory services (blood and urine testing, etc.)
  • Preventative and wellness services
  • Pediatric services

In short, a lot of the basic care that you will get on a regular basis should be covered by your health plan. Most of the time your doctor won’t suggest treatments that are not covered by your insurance. In a lot of cases, they will try to familiarize themselves with your health insurance plan so that they can lead you in the right direction. However, don’t leave the all the responsibility in the hands of your doctor. It’s important that you make time to read through your health insurance policy and look for any holes before getting services. 

What health insurance doesn’t cover

If you have a good insurance plan, most of your basic medical needs will be covered, but you might be surprised to know the services that generally are. Here is a list of services that health insurance does not cover:

  • Nursing home services: Most nursing home services are not covered by standard health insurance or even Medicare. However, nursing home care is covered by Medicaid. Many people are confused about this, because they confuse short-term care from a skilled nursing facility with long-term nursing home care. These two things are very different. For example, if you were to suffer from a fall or some other type of injury that required you to get surgery, you would need short-term care in a rehabilitative facility to help you get back on your feet. That kind of care is covered. Full-fledge nursing home care on the other hand, wouldn’t be covered because most health insurance providers place time limits on how long they will cover nursing home services. That being said, Medicare will only cover skilled nursing if the patient stayed for at least three days before staying in the skilled nursing facility. Additionally, the patient must be admitted to the facility for the purpose of seeking treatment for a short-term illness or injury as opposed to a chronic one. 
  • The shots you get before traveling abroad: At some point, health insurance companies decided that they would only cover services and procedures considered to be medically necessary, and travel vaccines didn’t make the cut. Now, we’re not talking about your standard health vaccines like the tetanus or flu shot; those are covered. But for those of you who like to travel, the cost of your Typhoid or Yellow Fever vaccine is coming out of your own pocket. This rule of thumb goes for the vast majority of health insurance policies, including Medicare.
  • Cosmetic surgery: Once again, health insurance policies will usually only cover what is “medically necessary.” It’s safe to say that Botox and lip injections will not be covered by your health insurance policy. However, there are certain surgeries that dance on the line between medically necessary and cosmetic. For example, if you wanted plastic surgery on your nose because you thought it was too big, that’s considered cosmetic. But if you had to get work done on your nose due to issues with your sinuses, then that’s probably going to be considered medically necessary. 
  • Acupuncture & alternative therapies: The rules surrounding acupuncture and other types of alternative therapies such as chiropractic care aren’t as black and white. Coverage for such services like massage therapy, acupuncture, and chiropractic care aren’t part of the requirements for most individual health care plans. However, depending on what state you live in, your health insurance plan might cover chiropractic costs. Say you are involved in a car accident that caused you to suffer from back injuries as a result. There is a good chance that your health insurance plan will cover these services. However, if you are a regular at the chiropractor just because you enjoy it, then it probably won’t be. While the standard Medicare plan does not cover acupuncture, there are some Medicare Advantage cans that can. Keep in mind that with most plans who do cover these types of services, there is usually a limit on how many visits you get. 
  • Dental, Vision & Hearing: If you are shopping around for health insurance plans with your employer, note that dental, vision and hearing services are not covered under a regular health insurance policy. If you want to get insured for these services, you will have to buy separate insurance plans for each one. Keep in mind that a lot of times, these insurance policies don’t have any limits on how much they can charge you in out-of-pocket expenses, so research different dental offices before receiving services. Some people choose to not include a dental plan at all. If you wear glasses or contacts, however, it’s probably worth looking into your options for vision insurance.
  • Weight loss surgery: If you’re considering having weight loss surgery, you might be in luck if you have Medicare or Medicaid. While there is currently not a requirement at the federal level for health insurance plans to cover bariatric surgery, Medicare and many Medicaid plans do cover it. Aside from those two plans, more than half of the states in the U.S. do require there to be at least partial coverage for bariatric survey as an essential health benefit (EHB). Remember that even if the state you live in mandates coverage for this procedure, you may still be responsible for some of the medical bills related to your weight loss surgery. 
  • Preventative screenings: Before we go any further, there are A LOT of preventative tests that are covered by your health insurance policy, but there are some that aren’t. This is where things get confusing for a lot of people. For example, mammograms, cholesterol screenings, and colonoscopies will be covered. But if you need to get Prostate Specific Antigen (PSA) screening, it most likely will not be covered.

  • Certain medications: Once again, there are a ton of prescription medications that are covered by most health insurance plans, since pharmaceutical services are one of the essential health benefits (EHBs). However, health insurers get to choose what to cover and what not to cover. Most healthcare insurance plans will choose to cover the minimum. This means that they will pick a drug from each class to cover, and not cover the rest. Many times, the generic version of the drug you are prescribed will be covered by your health insurance, while the name brand will not.

What Health Insurance Doesn’t Cover: Your Guide is a post from Pocket Your Dollars.

Source: pocketyourdollars.com