Your Email Address Can Be Used Against You

We have a lot of passwords to remember these days. It’s understandable that we forget them every now and then. It’s usually pretty simple to get them reset so you can start again. However, while very convenient, this can also be risky. When you forget your password, many websites will allow you to enter your email address to get a link via email to reset it. Nothing else is required. A persistent criminal can use email addresses to get access to accounts like PayPal or even your financial institution, where the payoff could be very big.

Jim Stickley of Stickley on Security wanted to prove this to a group of conference attendees. He wrote an app designed to collect the emails that went out to the users who forgot their passwords. He asked for volunteers who agreed to download an application that appeared to be a WiFi signal booster. They didn’t know what the demonstration was about, but willingly installed the app on their mobile devices knowing it would be of no real harm under those circumstances.

The app stealthily perused the devices and collected information from it, including email addresses. He could simply go to PayPal or Amazon, for example, request a password reset and intercept the emails sent. He then clicked the included links, changed the passwords, and had control of those accounts with no one knowing what happened.

In addition to getting access to certain online accounts, he was also able to peruse everything in the person’s email account. This is significant because there is a lot of information that can prove very valuable to someone who doesn’t have the best intentions.

The conference attendees agreed to be part of the above exercise, but there are thousands of malicious apps available on the Internet from third parties and even in the official app stores that don’t always ask for permission to access your information.

The danger that lurks on the Internet is perhaps not as dangerous as a mugger lurking in a dark alley. However, it does have its own version of that mugger and the dark alley. Read reviews of apps you consider for download and don’t sideload them. Use multifactor authentication (MFA) whenever offered, be skeptical of links and attachments you receive in email messages, and be conservative with the information shared on social meeting and online networking sites.

No one is going to look out for you or your information better than you. So take time to learn about the dangers and how to protect yourself. Stickley had no intention of using the information he gathered for evil. Others aren’t so courteous.

© Copyright 2017 Stickley on Security

Understanding Different Types of Student Loans

If you or a family member will be attending college soon, you’ve probably noticed that the sticker price for a college education has risen considerably in recent years. According to Sallie Mae’s National Study of College Students and Parents for 2015, families spent on average $24,164 for college in the 2014-15 academic year, and 38% of them borrowed at least some money to help pay the tab.

Though the costs can be steep, a college degree is a good investment in the student’s future. To get the best value from that investment, however, it’s prudent to make sure you get the right type of student loans for your individual situation.

Private Student Loans

For most people, federal student loans are a better deal than student loans from private entities like banks, colleges, and other lenders. This is because private student loans – though they can be used to pay for the same types of things as federal student loans – are structured much like other types of personal loans. Interest rates can be quite high – into the double digits — and they’re often variable, so there’s uncertainty about exactly how much you’ll owe. Also, repayment options are generally not flexible, and some may even require repayment to begin while the student is still in school.

Federal Student Loans

Federal student loans, which carry fixed interest rates, are generally available to all students – even those from affluent families – and most require no credit check and no cosigner. Though you accrue interest while in school, you generally won’t be required to begin repayment until you graduate. And, those with financial need may qualify for subsidized loans, which reduce their costs even more. After you graduate, if you experience financial hardship, you may be able to reduce or postpone your payments. In some cases, you can even have the debt forgiven through public service work.

So, given the many advantages of federal student loans, why would anybody take out private student loans?

Well, it’s those high costs mentioned above. While federal loans are a good deal, there are limits to how much a student can borrow, and that may not be enough to cover their college costs. However, though a college degree will usually pay off, it’s important for students to take a hard look at their earning potential after college when deciding how much to borrow. A smart rule of thumb is to borrow no more than what you expect to make in your first year of employment after graduation – this ensures a reasonable debt load that can probably be paid off within ten years or so.

And remember, neither federal nor private student loans are likely to be forgiven, even if you declare bankruptcy. So, even if you can borrow more, it’s wise to take on the minimum amount of debt you absolutely need.

BALANCE

Prepare for Major Life Expenses with Tax-Advantaged Accounts


College tuition, a new pair of glasses and retirement may seem unrelated, but the tax law says otherwise. By knowing how and where to save your money, you could pay for each of these expenses with tax-advantaged – or in some cases income-tax-free – money.

Individual Retirement Agreements (IRAs) and 401(k)s are perhaps the two most well-known examples of these types of accounts. But they’re not alone. With educational and medical expenses in mind, consider the following types of accounts and how you might be able to use one to help yourself or your family.

Invest your college fund in a 529 plan. State-sponsored 549 plans come in two forms. Prepaid tuition plans let you lock in today’s rate for in-state public schools and 529 college savings plans allow you to invest your savings based on your goals and risk tolerance. Contributions aren’t a federal tax write-off, but if you invest in your state’s plan, there might be a state income tax write-off.

As new parents ourselves, my wife and I made the decision to start preparing for our son’s education with a 529 college savings plan. However, the state where we live doesn’t offer a tax incentive. After diligently researching our options, we chose to establish the account in another state.

Many states let non-residents invest in their 529 plans and you can compare the state-based benefits, investment options, fees and contribution rules when choosing your plan. The College Savings Plans Network (CSPN) has tools to compare 529 plans by features or by state.

If the money is spent on qualified educational expenses, such as tuition, fees or school supplies, you don’t pay federal income tax (and may not have to pay state income tax) on investment gains.

Provide financial support for a disabled person using an ABLE account. News of a life-changing disability could come at any time. Following the Achieving a Better Life Experience (ABLE) Act in 2014, states can now sponsor ABLE savings accounts. Like 529 plans, contributions may be tax-deductible on the state (but not federal) level and the investment earnings can be withdrawn tax-free to pay for qualified expenses related to a mental or physical disability.

Beneficiaries must meet two criteria to qualify for an ABLE account: the disability must have begun before they were 26 and it must have “marked and severe functional limitations.” Anyone can contribute to the beneficiary’s ABLE account, and there is a limit on the total annual contributions – $14,000 as of 2017.

For individuals dealing with a disability and those taking care of a loved one, an ABLE account could make it easier to manage and plan finances. Generally, if you have a disability you’re disqualified from some types of federal government aid if you have over $2,000 in assets. The first $100,000 in an ABLE account doesn’t count against the limit for non-Medicaid services, and the entire account balance doesn’t count against the Medicaid limit.

Collectively known as ABLE 2.0, several new bills may increase the annual contribution for those who have a disability and are working, increase the eligibility age to 46 and allow families to rollover money from a 529 college savings plan to an ABLE account.

Make medical expenses more affordable with an FSA. Some employers offer a Flexible Spending Account (FSA) as a benefit to their employees. Employees can fund the accounts by putting aside a portion of their paychecks. You can then spend the money on qualified medical expenses, including eye exams, glasses and dental procedures, without paying income tax.

FSA accounts have a use-it-or-lose it provision and the money you don’t use could be forfeited at the end of the year. Employers could, but aren’t required to, allow employees to roll over up to $500 each year or give them an additional two-and-a-half-month grace period to use the money.

Bottom line: Paying for higher education, covering medical-related expenses and saving for retirement are three important financial goals. Incorporating tax-advantaged accounts into your long-term plan could be a win-win for your wallet. You might be able to save money now by lowering your tax bill and lower your effective costs later by withdrawing and using the money for qualified expenses.

by Nathaniel Sillin

Top Ten Verizon 2017 Breach Report Takeaways

Verizon recently released the tenth annual edition of its Data Breach Investigations Report. Inside was a lot of information based on 40,000 analyzed incidents and nearly 2,000 confirmed data breaches. While there are a lot of significant statistics and a plethora of good cybersecurity related information, there are a few important takeaways for any organization to consider, including that smaller organizations are also victims of data breaches and training might just be the most important tool in the cybersecurity toolbox. The top ten are listed below.

The 2017 report determined:

-61% of attacks were against businesses with fewer than 1,000 employees.
-75% of the attacks were perpetrated by outsiders, but 25% were from the inside.
-81% of the breaches leveraged stolen and/or weak passwords.
-24% were against financial organizations.
-73% were financially motivated attacks.
-95% of phishing attacks that led to a breach were followed by some type of software installation. Of those, -66% were via malicious email attachments.
-51% of the attacks involved malware.
-1 in 14 users were convinced via trickery to click on attachments or links in email messages. Unfortunately, -25% of them did it more than once.
-60% of the breaches involved some type of physical security breach. This category includes, but is not limited to insiders stealing data, snooping, or someone inside providing data to a competitor.
-88% of the intrusions fell into one of nine categories (in no particular order): Denial of Service (DOS), web application attacks, Point of Sale (POS), payment card skimming, physical theft and loss, crimeware such as ransomware, cyber-espionage, privilege misuse, and miscellaneous errors. This last category is defined as involving such items as publishing errors, improper disposal of information, and misconfiguration, as well as mailing paper documents to the wrong recipient; which was the most common.

While there are numerous areas on which to focus as a result of the findings in this report, there are a couple that should be high priority:

1. Train employees on the nine categories that see the highest number of intrusions.

2. Ensure that everyone who opens email knows how to identify potentially malicious attachments and links. Then provide continual awareness training to keep on top of the most recent threats.

3. Have a solid policy on creating strong passwords, teach users how to create good ones, and require them to be changed regularly.

Training should not happen one time and then put aside for a year or more. People forget and get too busy to pay attention to tiny indicators. Phishers get more creative. Threats evolve. Training should continually evolve along with them.

© Copyright 2017 Stickley on Security

Life Stages: How to Manage Your Finances Through the Years

There are certain times in life when particular money management areas need special focus. The list below may remind you of areas of your finances that need special attention now or in the near future. Bear in mind that our stages are generalizations: some people are married with children in their twenties while others do not have dependents until their 50s, if ever. Whatever your situation, it’s important to plan ahead to accommodate the coming changes in your financial situation.

20s

This is a time when you probably finish your formal education and begin your first “real” job. Now is the time to start developing sound financial habits for a lifetime.

-Establish credit and maintain a good payment record. —Do not charge more than you can pay off in 3 months (or better yet, within the month).
-Set up an emergency savings fund, typically 3-to-6 months’ living expenses. Keep this money as liquid (accessible with few, if any, penalties) as possible.
-Start learning about investing and establish an automatic savings program to reach your financial goals.
-If you can, buy a home, or start saving for the down payment.
-Make sure you are taking full advantage of the savings benefits available to you through your employer: 401(k) or 403(b), et cetera.
-Make sure you have adequate insurance coverage (life, home, auto, health, disability, liability).

30s

-If you have children, begin investing for their education.
-Continue to keep credit under control and avoid paying finance charges and annual fees.
-Write a will or review the one you have.
-Review your insurance coverage in light of changes in your family situation, increasing assets, or professional activities.

40s

-As your income grows, look for investments and savings plans that shelter some of it from taxes.
-Use a retirement planning software program or see a financial planner to figure out exactly how much you’ll need to have saved to maintain your lifestyle in retirement.
-Step up personal and employer-sponsored retirement savings accordingly.
-Review your investment allocation and make sure you are still well diversified.

50s

-Review your will and estate plan.
-Pay off your debts. Depending on the going rates for different types of investments, it may or may not be wise to pay off your mortgage now.
-Maximize your savings for retirement.
-Make sure your growing assets are protected by liability insurance.

60s

-As you near retirement, switch a portion of your investments to low-risk types to produce income rather than higher-risk growth.
-With life expectancy increasing, make sure a portion of your retirement nest egg is invested so that it continues to outpace inflation.
-Maintain your health and long-term-care insurance.
-Remain wary of scams aimed at seniors.
-Research reverse mortgages if you are a homeowner. -You may need to tap the equity in your property to supplement your retirement income.

BALANCE
Revised February 2016.

Safely Cut the Cost of Elective Medical Expenses

Whether it’s a matter of comfort, appearance or safety, there are many medical procedures that you may want or need, but your health insurance won’t cover. Laser eye surgery may fall into the want category for most people and it can be a hefty investment with each eye costing several thousand dollars. For those wanting to start a family, infertility treatments, which can cost over $10,000, may be closer to a need. Yet most states don’t require health insurance to cover treatments.

Considering the lasting impact that these and other procedures can have on your life, you may not want to seek out the least expensive option. However, that doesn’t mean you should forgo attempts to save altogether. From tax-advantaged accounts to comparison shopping doctors, there are many approaches to safely cutting costs.

See if you could get a tax break. Although tax breaks don’t lower a medical procedure’s price, tax deductions can decrease your taxable income and by using a tax-advantaged account you may be able to pay for some medical procedures with income-tax-free money.

  • Take a medical expense tax deduction. If you itemize your tax deductions, you can get a deduction for your qualified medical expenses that exceed 10 percent of your adjusted gross income. Laser eye surgery and some fertility enhancement treatments may qualify. However, cosmetic surgery doesn’t unless it’s related to a congenital abnormality, disfiguring disease or an injury resulting from trauma or an accident.
  • Use an employer-sponsored flexible spending account (FSA). Some employers offer FSAs as an employee benefit. You can make tax-deductible contributions to the account each year and withdraw the money tax-free to pay for qualified medical expenses, including health insurance deductibles and copayments. However, this approach could require planning as you may forfeit remaining FSA money at the end of each year.
  • Enroll in health insurance with a health savings account (HSA). An HSA account is similar to an FSA in that you can contribute pre-tax money and withdraw funds to pay for eligible medical expenses tax-free. HSAs don’t have the use-it-or-lose-it requirement, but to qualify for an HSA account, you need to enroll in a High Deductible Health Plan (HDHP) and can’t be eligible for Medicare.

Ask your health insurance company about discounts. Even when a health insurance provider doesn’t cover a procedure, members may still be able to save money by going through their insurance.

For example, health insurance generally won’t cover the cost of laser eye surgery, but your provider may offer a 5 to 15 percent discount if you get the surgery at partner eye care centers.

Health insurance requirements can also vary from one state to another, and you should double-check your benefits before assuming something isn’t covered. Infertility treatment is one of these gray areas, as some states require health insurance plans to provide coverage while others do not.

Compare costs from different providers. Varying medical costs sometimes make headlines when patients find out that a $3,000 medical procedure at a hospital could cost several hundred at a nearby clinic. If it’s not an emergency, there are websites that you can use to comparison shop nearby medical centers and get estimated prices.

Some people also look for savings in other countries. Medical tourism is a growing industry, and millions of people travel outside their home countries seeking lower costs, higher-quality services, treatments that aren’t available at home, a relaxing environment to recover in or a combination of several of these factors. While the U.S. is a destination for some medical tourists, Canada, Southeast Asia, Latin America and parts of Europe are also popular.

Bottom line: Although you may not be able to convince your health insurance company to cover what it considers an elective procedure; you can turn to other methods to save money. As with other large expenses, you can take a dual big- and little-picture approach by looking for tax breaks that lower your effective cost and savings opportunities that can reduce a procedure’s price.

by Nathaniel Sillin