Financial Smarts: Are You Prepared for the Unexpected?
While you may be living a comfortable lifestyle, what would happen if you lost your job tomorrow? Almost half of Americans say that if they lost their primary source of income tomorrow, they could only maintain their current lifestyle for three months or less.
A recent study commissioned by the Million Dollar Round Table (MDRT) and Harris Poll, revealed that many Americans, even those considered financially successful, do not account for unexpected risks during financial planning.
A majority of Americans (61 percent) say their family would assume debt if the primary earner passed away tomorrow, with 38 percent of U.S. adults saying the debt would be $10,000 or more. Additionally, only half of Americans (50 percent) have life insurance. Of those who have any dependents, 47 percent say their dependents would run out of money without their personal income in two years or less if they were to pass away tomorrow.
Americans are also not taking into account the possibility of disability or illness while planning for their financial future. One in 20 Americans (5 percent) are unemployed and unable to work because of disability or illness, but only 20 percent of U.S. adults have either short-term and/or long-term disability insurance. Of those Americans who do have disability insurance, only 39 percent believe it would be enough to cover their long-term care and medical expenses if they were to have an accident.
And it’s not just lower-income Americans who are vulnerable to financial risk. On average, those surveyed say their household has two sources of income, with 40 percent having income of $74,000 or more.
Future college expenses also pose a potential financial risk for many Americans. Although college expenses are rising faster than inflation, only 36 percent of parents with children under the age of 18 in their household are saving for their children’s college education.
Lack of college savings may be a result of many Americans still working to pay off their own student loan debt. According to the Quarterly Report on Household Credit and Debt from the Federal Reserve Bank of New York, Americans currently owe $1.31 trillion in student loan debt.
To help protect you and your family from these risks, talk to a financial planner and come up with a course of action for a secure financial future.
Making Sure Your Central Air Unit is Ready for Action
As temperatures rise, our thermostats get lowered. Make sure your Central Air Unit system is up for the challenge with some simple maintenance checks from Baltimore-based Winstar Home Services.
Replace your air filters
Air filters work overtime in the winter, so be sure to replace your filters. Dirty air filters make your Central Air Unit system work harder than it needs to. This puts strain on the system, which can cause bigger issues and lead to higher utility bills.
Check and clear your unit’s drainage line
Most Central Air Unit units have a drainage line at the base of the cabinet. In order for the unit to run properly, the hole needs to be clear. To make sure the drainage line works properly, use a paper clip or a wire to ensure the hole is clear of any obstructions.
**Marina’s Tip: Buy a small water/air/blower vacuum system in Home Depot. It will be the best $30.00 you can will invest. Open the the drainage line once a month in both ends of the drainage and blow to the outside, vacuum from the inside of the unit**. Tips for Healthier Homes
Check your duct work for issues
Your home’s duct work, or ventilation system, can often be the cause of poorly distributed air, which means you’re spending more money on cool air that isn’t making its way into your house. Check for leaky connections and return vents, damaged or fallen insulation, and ensure your vents (both incoming and outgoing) are not blocked or obstructed by rugs or furnishings.
Test your unit
Turn on your AC and let in run briefly to see how it performs. If there are any problems, address them right away.
Make sure you conduct these tests before temperatures hit their peak.
How-to Buy a Home in a Tight Market
We all know the equation about how to buy a home in a tight market: low inventory means higher prices. Also known as a tight market, this setting can be stressful for buyers, who are trying to snap up their dream home but keep running into competition. According to the National Association of REALTORS® , attempting to purchase a house in this type of market can make the already complex process of buying a home even more overwhelming.
To help buyers successfully get through the buying process in a tight inventory market, NAR offers these five suggestions:
Determine and stick to a budget. Before beginning the house hunting process in a tight market, prospective homebuyers should receive pre-approval from one or more lenders to verify the amount of money they are qualified to borrow. Then, after taking into account additional costs of ownership such as taxes, utilities and insurance, buyers should determine a final budget they can comfortably afford. When listings are scarce, bidding wars can drive up prices, so buyers must be prepared to walk away if the asking price surpasses their budget.
Identify desired neighborhoods and home wants versus needs. When housing inventory is tight, buyers may need to compromise on what they believe they want from a home. Certain wants, such as stainless appliances or hardwood floors, can be added later. However, if a buyer wants to be in a specific school district or have a decent sized backyard, those cannot be addressed later and must be taken into account during the house hunting process.
Be ready to make a decision quickly. In a seller’s market, homes rarely stay on the market long, so when a house that is in their budget and checks off all of their needs come along, buyers should not hesitate. Buyers should be ready to submit an offer quickly, or they may risk missing out on the home altogether.
Bid competitively and limit contingencies. It is tempting to submit a low offer as a starting bid, but in a seller’s market buyers need to put forward their highest offer from the very beginning or they are likely to lose out on the home. It is also important to remember that in multiple bidding situations it is not always the highest offer that is most attractive to the seller but the one with the fewest contingencies. Removing restrictions related to the sale of a current home and being flexible with things like the move-in date can make a bid stand out to a seller.
Work with a Realtor®. All real estate is local, so it is important to work with an agent who is a Realtor®, a member of the National Association of Realtors®, and who is familiar with the areas and neighborhoods the Home Buyers are considering. Realtors® are the most trusted resource for real estate information and have unparalleled knowledge of their communities; they can give buyers the competitive advantage needed in a tight market.
Rents Appreciating Faster in Suburbs as Demand Intensifies
Renters up against ballooning costs in sought-after cities have steadily spread outward for rent relief—but now, costs are climbing in areas outside of cities, too.
In fact, according to a recently released report by Zillow, rent appreciation is accelerating faster in suburban areas than urban ones, with the median rental cost in suburban areas up 2.5 percent year-over-year, while the median rental cost in urban areas is up 2.3 percent.
“Because walk-able urban centers close to amenities are typically a big draw for renters, you’d expect rents to rise faster in the city than in the suburbs—which is exactly what we’ve been seeing until very recently,” says Dr. Svenja Gudell, chief economist at Zillow, “but a handful of factors are helping turn the tables and beginning to push suburban rents up at a higher clip. These include deteriorating rental affordability in expensive urban cores; new apartments, albeit high-end ones, opening downtown compared to relatively few in outlying areas; and preferences among some renters toward the space offered by single-family homes in the suburbs.”
The difference represents a shift from one year ago, when urban rental costs were up 5 percent year-over-year and suburban rental costs were up 3 percent. There are starker disparities in appreciation in in-demand urban areas and their suburban counterparts, including in Nashville, Tenn., and San Francisco, Calif.
“Rents themselves are still lower in the suburbs, but if demand keeps growing for suburban rentals and supply continues to lag, that will also start to change,” Gudell says. “As more formerly urban renters move to the suburbs in coming years, we’ll likely start seeing more apartment buildings and walkable amenities popping up in those communities.”
Modest Economic Forecast as Fed Gears Up for More Rate Raises
Fannie Mae’s Economic & Strategic Research (ESR) Group kept its latest forecast dependent on the Trump Administration’s policies, projecting modest growth for the economy, as well as some breathing room for the pressured housing market.
“Our economic forecast remains unchanged in April as we continue to await details on the new administration’s plans,” said Doug Duncan, chief economist at Fannie Mae, in a statement. “We’re intrigued by the disparity between elevated consumer and business optimism and signs of decelerating first quarter economic growth; however, we expect growth to rebound this quarter as special factors that weighed on growth partially unwind.”
Consumer confidence, which gauges consumers’ perceptions of business and labor market conditions, hit a 16-year high in March, according to The Conference Board. Consumer confidence in housing, specifically, was split between homebuyers and sellers, with sellers expressing more optimism overall.
In terms of monetary policy, the ESR Group expects the Federal Reserve to raise the key interest rate—which has an effect on mortgage rates—two more times in 2017, totaling three raises for the year.
“With the firming of the Fed’s favored measure of inflation [and] reduced labor market slack, and the more hawkish tone of the Federal Open Market Committee at its March meeting, we foresee that the Fed will hike rates two more times this year, in June and September, and announced a change to its reinvestment policy in December,” Duncan said.
New-home sales tacked on another month of gains, with sales of new, single-family homes up 5.8 percent to 621,000, according to the U.S. Census Bureau and the Department of Housing and Urban Development (HUD). The average new-home sales price was $388,200, while the median was $315,100. New-home listing inventory was 268,000—5.2 months supply.
The Good News?
“There is good news and bad news in [the latest] New Residential Home Sales data release by the Bureau of the Census,” says Joseph Kirchner, senior economist at realtor.com®. “The good news is that new-home sales jumped for the third month in a row, to about the same as last year’s peak in July. Already this spring market is challenging last year’s high water mark.
And The bad News?
“The bad news,” Kirchner says, “is that sales are increasingly concentrated at the mid- to upper-end of the price range. Sales of affordable new homes under $200,000 dropped to 12 percent from 17 percent of the market since last April. Home prices are climbing faster than incomes, and affordable and starter homes are few and far between. This is going to keep many would-be buyers on the sidelines.”
New-home sales are paralleling the path of home prices, which, as recently reported by the S&P Dow Jones Indices, rose 5.8 percent in February.
Americans Find Moving More Stressful Than Weddings
After the excitement of finding a new home comes the stressful task of moving into it. Despite its stressors, moving is inevitable; The U.S. Census Bureau projects 40 million Americans will add another home to their list this year, with 65 percent moving between Memorial Day and Labor Day. According to SpareFoot.com, Americans have moved an average of six times throughout their lives.
The top findings from SpareFoot.com’s study on the emotional side of moving:
More stressful than a wedding. Surprisingly, 58 percent feel moving is a bigger challenge than wedding planning!
Argument starter. Stress often leads to arguments, so it makes sense that 31 percent of Americans who have moved in with a partner– including 46 percent of Millennials – have had some of their worst arguments while moving.
A time for parents to be selfless. Prior to a move, 69 percent of American parents claim they prioritize their child’s needs over their significant other’s needs.
It takes longer with kids. Like with most things you do with your children, the actual process of moving with children can take up to eight days longer, on average.
Finder’s keepers. Wading through sentimental items may make your move take longer. The study found that 81 percent of parents admit they have kept a child’s possession, even when given permission to get rid of it.
**Marina Sarabia 2 Cents: The Big 3: Selling your house, job relocation cross country, buying new home. If your relationship can survive that, you’re strong to take anything coming your way!
(Family Features)–Turning your home into the living space of your dreams takes effort and commitment, but while the weather is warm and motivation is on your side, it’s time to put your visions to the test.
Whether you choose to start your renovation poject on the inside or outside, for fun or for function, the important part is committing to getting it done and doing it right. That includes finding the right materials and products to suit your specific needs and style, whether it’s for closet organization, a beautiful kitchen upgrade, adding features like skylights or anything in between.
Your dreams and desires for your home are attainable and within your reach, so long as you’re devoted and willing to put in the time to have a more functional home .
Natural Light and Fresh Air from Above
You can brighten your space in an eco-friendly way with Energy Star-qualified, solar-powered fresh air skylights which provide natural light and ventilation to reduce energy costs. Adding solar-powered blinds can further increase energy efficiency. These products, along with installation costs, qualify for a 30 percent federal tax credit. To find certified installers, visit whyskylights.com.
Versatile Home Storage
It’s time to get organized. Turn any closet or area in your home into a designer-inspired storage showcase. Find free design, inspiration and organization solutions at closetmaid.com/suitesymphony.
Ideal for enjoying a serene cup of coffee or welcoming guests for some outdoor fun, you can liven up your backyard space with a patio furniture set to help both aesthetically and functionally. The right set for your deck, patio or yard can lend a pleasing element to the eye and a comfortable spot to sit and eat, drink or rest after a friendly game of whiffle ball. Available in myriad colors and combinations, look for patio furniture that matches your style and personal preferences.
Find a comfortable temperature and enter your most relaxed state at any time with your own backyard hot tub. The gateway to a restful opportunity, a hot tub gives you a chance to close your eyes and unwind whether it’s the end of a long day or starting out your Saturday morning. With varying options like in-ground or above and a multitude of sizes, plus the ability to tune individual jets to your liking, a backyard hot tub can be the perfect personal oasis.
A Finishing Touch
Bring everything together in a kitchen or bathroom with the subtle feature that can sometimes be forgotten – the faucet. Extravagant or simple, modern or classic, the faucet can serve multiple aesthetic purposes like catching attention upon entering the room or simply complementing the design elements around it. Adding the final touch with the right faucet can be a beautiful way to wrap up a room.
**Marina Sarabia’s 2 Cents: Dare to scramble your rooms if the size or use of them don’t make sense. If you have a family room/den and a living room, but the the dining room/area is way too small of an area to accommodate a formal dining table, make it a reading/meditation area or chatting area. When was the last time you used your living room? Make that important piece of your real estate your formal dining and have as many family members and friends over for Thanksgiving Dinner!
I recently attended a workshop on water conservation. Depending on which part of the country you live in, water conservation and preservation are a hot subject. One of the presenters said that if every homeowner did just one thing, it could make an exponential difference toward ensuring we could pour fresh drinkable water every time we turn the tap. That one thing is installing one or more home rain barrels.
Our contacts at the Missouri Botanical Garden says a key to maximizing your property’s sustainability is conserving water and controlling water runoff.
– Water plants only when they need it. Lawns only need about 1 inch of rain a week. Set up a rain gauge to record weekly rainfall.
– For lawns, use a low-angle spray instead of oscillating sprinklers as they result in less water loss due to evaporation.
– Position watering devices to prevent water loss by water falling in storm gutters, walkways or in the street.
– Use drip irrigation or soaker hoses instead of oscillating sprinklers as they result in less water loss due to evaporation.
– Position watering devices to prevent water loss by water falling in storm gutters, walkways or in the street.
– Add mulch beds to help retain soil moisture.
– Set up a rain barrel to collect rainwater for watering plants.
Elsewhere on your property:
– Plant a rain garden or developing a swale to help retain water in the soil and prevent runoff.
– Install a cistern to collect water to use for plants, washing clothes, bathing and other non-potable uses as local ordinances allow.
– Investigate the use of grey water use in your area.
– Remove hard surfaces in your landscape to allow water to percolate into the soil and not run off in storm gutters. Replace with a porous surface if needed.
– Incorporate “rainscaping” features such to manage storm water.
– Don’t use the hose to wash off your driveway, deck or walkway. Instead use a broom or an electric blower (gas-powered blowers produce more pollutants).
**My 2 Cents: The use river rocks where water tends to sit after a heavy rain, it’s a great inexpensive way to manage storm water.