Why Disability Insurance Is Critical

Most people understand why having life insurance is a good idea: Nobody wants to leave their survivors in a financial lurch if they were to die suddenly. But what if you suffer an accident or illness and don’t die, but rather, become severely disabled? Could you or your family make ends meet without your paycheck, possibly for decades?

Although most people are entitled to Social Security disability insurance (SSDI) benefits if they’ve paid sufficient FICA payroll taxes over the years, the eligibility rules are extremely strict, applying can take many months, and the average monthly benefit is only about $1,150.

So what are your other disability coverage options? Many companies provide sick leave and short-term disability coverage to reimburse employees during brief periods of illness or injury. Some also provide long-term disability (LTD) insurance that replaces a percentage of pay for an extended period of time.

But employer-provided LTD plans usually replace only about 60 percent of pay and the money you receive is considered taxable income, further lowering your benefit’s worth. Plus, such plans often have a waiting period before benefits kick in, will carve out any SSDI benefits you receive, and cap the monthly benefit amount and maximum payout period (often as little as two years).

Thus, even if your employer provides basic LTD, you might want to purchase additional coverage. Just be prepared: LTD insurance can be expensive. Yearly premiums may cost 1 to 3 percent of gross income, depending on plan features, your age, and whether you have preexisting conditions.

First, see if you can buy supplemental coverage through your employer’s plan – their group rate will be cheaper than an individual policy and you probably won’t need a physical exam. Or see if any professional or trade organizations you belong to offer group coverage.

If not, you’ll have to buy an individual policy. A few of the things to keep in mind:

  • The younger and healthier you are, the lower the premiums you’ll be able to lock in.
  • Some policies won’t pay benefits unless you can’t perform the duties of your own occupation, while others specify that you must be physically unable to perform any job (the latter coverage is much cheaper).
  • Look for a “non-cancelable” policy, which means the insurer can’t cancel or refuse to renew your policy – or raise the premium – if you pay on time.
  • The longer the waiting period before benefits are paid, the lower the premium. Thus, if you have enough sick time and savings to wait 120 days before payout, your premiums will be significantly less than for a 60-day waiting period.
  • Some policies only provide benefits for two years, while others pay until your normal Social Security retirement age – most cover somewhere in between. The shorter the term, the lower the cost.
  • Many plans exclude preexisting conditions, mental health or substance abuse issues.
  • For an additional fee, policies with a “future purchase option” allow you to increase coverage as your wages rise, without having to take another physical or rewrite the policy.
  • Check whether the benefit payout amount is fixed or if cost-of-living adjustments are made periodically. The latter type is more expensive but offers better protection against inflation if you’re disabled for many years.

Bottom line: If you became seriously disabled it could easily wipe out your savings and put your family in financial jeopardy. Before you actually need it, investigate what disability coverage you already have and what other options are available.

By Jason Alderman

Having Trouble Paying Your Heating Bill? LIHEAP Could Help

The chill of winter can be offset with the pleasure of curling up inside a warm home. Turning on the heat and settling into your favorite chair to open a new book or watch a movie feels even better when snow falls or rain patters against the windows. Unfortunately, some families have to choose between paying high winter utility bills and buying groceries or gas for their cars. The necessity of food and transportation often wins.

Fortunately, there are assistance programs. One such program, the federal Low Income Home Energy Assistance Program (LIHEAP), helps low-income households with heating or cooling costs, during an energy-related crisis (such as a shutoff notice from your utility) and with weatherization improvements.

If you, a parent or a friend are struggling to make ends meet this winter, LIHEAP and similar programs might be able to help keep your home warm.

Apply as soon as you can if you think you’ll need assistance. The federal government provides the funding for LIHEAP, but the programs are run at the state level. The money gets distributed on a first-come-first-served basis and states give priority to households with children, elderly or disabled members. Often the largest benefits are awarded to the homes with the most need.

States open their winter applications at different times, and you should apply for LIHEAP right away if you think you’ll have trouble paying for heating.

LIHEAP won’t cover your entire utility bill, but it can help keep your home warm. LIHEAP’s heating benefit is only intended to help you pay to heat your home. For example, if you’re heating unit runs on gas, the program will contribute towards your gas bill, but not your electricity bill.

You might only be able to receive a benefit once every 12 months, but it can make a big difference for your finances. For the fiscal year 2014, the most recent data available, over 5.7 million households received heating assistance and it offset an average 45.9 percent of recipients’ annual heating costs.

Qualifying for LIHEAP assistance. States, tribes and territories have some control over the services, qualifications, aid limits and application process for the LIHEAP program in their area.

You can review each state’s income eligibility for the fiscal year 2017 on this table. The state or local organizations that distribute funds also consider applicants’ utility costs, family size and location. Renters and homeowners could be eligible for LIHEAP assistance, but you might not qualify if you have subsidized housing.

Being qualified doesn’t guarantee that you’ll get assistance. Each state receives a set amount of funds for the year, and on average only 20 percent of qualified household receive benefits.

How to apply for LIHEAP. Often you’ll apply for LIHEAP at a Community Action Agency (CAA), local non-profit organizations that help administer federal, state and local grant programs. Some states let you complete the application online, otherwise you may need to mail, fax or hand in an application.

The Office of Community Service’s website has contact information for each state and territory, including a link to a website where you’ll find state-specific eligibility guidelines and program information.

As part of the application process, you may need to share identifying and financial information, including:

  • Recent utility bills.
  • Recent pay stubs, or a profit-and-loss statement if you’re self-employed.
  • Documentation for other income, such as Social Security benefits.
  • A lease or property tax bill as proof of your address.
    Your Social Security number.
  • A list of people living in your home, their relation to you, dates of birth and incomes.
  • A copy of a utility termination notice, if you received one.
  • Your energy provider’s information.

If you’re having trouble with your state’s website, or want to help someone who isn’t computer savvy, you can call the LIHEAP Clearinghouse’s National Energy Assistance Referral (NEAR) at 1-866-674-6327 (TTY: 1-866-367-6228).

Bottom line: When the temperature drops, heating costs can quickly rise. You shouldn’t have to suffer, and LIHEAP could help provide much-needed financial aid. You can look for additional assistance programs using the Benefits.gov search tool. Also look into state-based programs and payment plans or assistance from your local utility.

By Nathaniel Sillin

Amazingly Realistic PayPal Scam Seeks Your Sensitive Details

There is yet another phishing scam targeting PayPal users. This one is an example of how the fraudsters and scammers are getting pretty good at tricking their victims. It even uses the actual PayPal logo (or an incredibly well-done facsimile of it), the PayPal color schemes, and claims there is an issue with the user’s account that needs to be corrected. Until it is, there will be limited access and functionality to the account.

The email received is not bad, but still does have the tell-tell signs of phishing, if you are paying close attention. There are few language mistakes (for example, one heading is “What the Problem’s”) and there is a generic greeting of “Dear Customer.” It also has a sender address that is nothing similar to PayPal’s domain (in the example seen, it was “notice-access-273.com”).

However, if the reader is tricked into thinking there is a problem, the button included in the email that supposedly goes to the PayPal login screen, actually goes to a fake site. Now, the phoniness of that site is very difficult to detect. It has the PayPal logo nicely done. At the bottom are the logos for a 100% secure site by Symantec, but the wording is not quite right: “Secured & Certificate by Symantec.” If you are looking for the green lock next to the URL to ensure you have landed on a secure site, you will see it. Per ESET, the thieves are transmitting the form over an HTTPS link.

Along the side of the screen are some FAQs about having limited access. A subsequent screen after clicking the “continue” button has a list of items to fill in. These include address, social security number, and mother’s maiden name.

Always be on the lookout for phishing. With the plethora of data breaches occurring these days and the sophistication of the fraudsters on the rise, it’s ever more important to pay close attention when an email is received that says something is wrong with an account that stores such sensitive information. Never click links or attachments included in those. Go directly to your account and login from a previously saved link or by manually typing the URL into the address bar. If you receive a suspicious email or find a fake PayPay-related site, you can report it to PayPal as well. There is more information in its Help Center.

PayPal is a particularly attractive target for such scams because it’s tied to payment card and bank account numbers. If they get your login credentials, it’s not much more effort for them to steal from you. Always take the time to read messages carefully and if there is any suspicion at all, don’t click.

© Copyright 2017 Stickley on Security

Lost iPhone Provides ID Thieves Great Opportunity to Go Phishing

There is an account of someone online who was relieved of his iPhone while vacationing in Italy. It was stolen out of the rental car when he was away for a couple of hours. While these things happen all the time, what happened to him later is quite interesting. His story provides a couple of lessons. The first one is a good reminder. Don’t leave your smartphone unattended in your car. That just invites theft; even if you live in a small town in the middle of the U.S. where you know most of the people in town.

Once this person discovered his phone was missing, he went into Find My iPhone and entered his phone number and a note to call him in case it was found. Essentially what ended up on the lock screen was “This iPhone has been lost. Please call me” with a phone number and button to press to call. After that, he simply went on with his vacation confident that his data was secure and that no one could activate the phone.

Eleven days later, he received a text and email that his phone had been found. What was in the email was a very professionally done message with a link that he was to click in order to see the last location of his iPhone. Sounds great, until he clicked the button. He started to enter his Apple ID credentials and before he got too far, he had second thoughts. That was because he suddenly realized it was a phishing scam.

He noticed the address at the top of the screen and it didn’t look like Apple would use it. It was “show-iphone-location.com.” It also had no indicator that the site was using a secure certificate, as the Apple site would. He also looked up the owner of the site and it was registered to someone in the Bahamas. There were other warning signs as well, but you get the picture.

If you use the “Find My iPhone” feature on your device, use caution about what you put into the text box should you need to use that app. Never enter your email address, because that allows someone to potentially phish for sensitive details. In addition, be a bit on edge about any telephone calls you may receive from Apple claiming someone found your iPhone. It is highly unlikely that Apple would call you. They might send email to the address you have on file in your account and they might even text you, but it’s doubtful they’d place a phone call. That said, should you receive one tell the caller thank you and hang up. Contact Apple separately using a number on their official support site. Never give anyone who calls you unexpectedly or unsolicited, sensitive information or login credentials.

In this story, the victim assumed that the thieves got his name from the “Medical ID” information stored on his phone, before he had a chance to lock the device. There is a place where you can put in certain information such as your name, blood type, allergies, and emergency contact information that is available even when the iPhone is locked. If the thieves indeed used that, they could have found his name there and searched online. Since his name is very unique, they could have figured out his email address using online searches and social engineering.

However, if the phone has been locked in the Find My iPhone app, it only shows on the lock screen what is written in the boxes when you filled it in iCloud. So if you don’t add your name, email address, social media handles, or any other identifying information, thieves won’t know how to find you in other ways.

Also, when filling in the medical ID section, consider putting in limited information. Since it could very well save your life, some information such as allergies to medications might be very useful. However, using your first name and the first names of your emergency contacts might be preferred over including last names too.

If you are one of those people who don’t lock their phone, it is highly recommended that you do. Had this one not been, whoever took it could have run off with a wealth of information. After all, think about all the details we keep in them these days: Our name, contact numbers, email addresses, banking and financial apps, access to home security systems, health data, social media apps with automatic login selected, etc. Which brings us back to the first tip and just don’t leave valuables in your vehicles.

© Copyright 2017 Stickley on Security

Make the Most of Your Rewards Program Membership

I’m often intrigued and sometimes inspired by stories of people traveling the world using points and miles. There’s a well-known (within certain circles, at least) man who earned over a million airline miles by purchasing more than $3,000 worth of pudding during a special promotion in 1999. Or, you might have heard about people using coupons during a grocery store’s membership-only sale to get food and household products for free.

While I might not be as enthusiastic as some world travelers, or as extreme as some couponers, I do see the benefit in a program that’s free to join and offers you potentially money-saving perks. However, I also know it’s important not to get so caught up that I wind up spending more money than I would otherwise. As a friend of mine loved to say, “never spend a dollar to save a nickel.”

The perks of membership. There are many loyalty or rewards programs to choose from and the rules and benefits can vary. For example, a grocer’s program might offer the same in-store savings and exclusive coupons to all its members. By contrast, travel rewards programs often have tiers, different levels of membership with varying benefits depending on how often you travel or how much you spend. While the basic tier may offer discounted hotel rates or free Wi-Fi, the higher tiers might come with free room upgrades (including to coveted suites) and guaranteed early check-in and late check-out.

Recognize why companies might have rewards programs. When you’re a big fan of a company or product, getting rewarded for your loyalty can be great. After all, it’s a free perk if you were going to make the purchase anyway. But try not to get too attached to a particular company or product based solely on the rewards program.

Buying something simply because you get a discount as a member, or making a purchase “for the points,” might be a waste. You could find yourself with a pantry full of products that are slowly going bad, or paying more for a trip because you didn’t comparison shop the offerings from other airlines or hotel chains.

Joining a rewards program could lead to overspending if you’re not careful. Recognizing that the programs could be designed to get you to spend more, and more often, can help you refrain from overspending. Here are a few additional ways to make sure you maximize your benefits.

Don’t double-count your savings. You’re tricking yourself if you consider the rewards points from a retailer’s program as savings when making a purchase and then consider the same points as savings (again) when you redeem them for store credit. Count the rewards once, or don’t make them part of your buying decision at all.
Keep your programs organized. Points in some programs expire if you don’t use them within a specified period or have recent account activity. You could use a website, app or spreadsheet to help track your accounts, how many points or miles you’ve earned and when they expire.
Another way to avoid overspending is to consider your net cost when comparison shopping. To do this, you’ll need a list of the dollar value of each programs’ rewards points. You could take a shortcut and copy the values other enthusiasts place on each program’s points. Or, you could make estimates of your own based on trips or purchases you regularly make.

Now you’ll know when 1,000 points are worth $1 or $10 and can plan your purchases accordingly. In the end, you want to be able to make as close to an apples-to-apples comparison as possible, inclusive of the value you place on the rewards.

Bottom line: Consumer rewards programs offer a wide variety of benefits, including exclusive savings and complimentary perks. While it’s often free to join the programs, and you could get rewarded for doing so, keep the big picture in mind and be careful about letting your membership lead to unnecessary purchases.

By Nathaniel Sillin

3 Ways to Live a Debt Free Life

There is one thing the majority of us are guilty of and often times it happens so fast, we don’t even realize it until it is too late–over-extending ourselves financially. It starts off when we are kids with a shiny new bike or the latest (and most expensive) video game system; and it extends all the way into adulthood with our houses, cars, clothes, and vacations.

Madonna’s old statement still rings true over twenty years later– we all just live “in a material world,” and because of it, most of us are always left desiring something that is just out of reach. Whether you are living on your own for the first time at college or starting over again later in life, it’s important to stay grounded when it comes to your finances.

One of the greatest positions you can put yourself in life is to be debt free; it simply means you have the financial flexibility to have options that people who are in debt unfortunately do not. It may seem like a daunting task, but living debt free starts on a basic concept–being smart enough to avoid accumulating an owed amount that is greater than the amount you can afford.

Here are three expert suggestions that can keep you and your family out of harm’s way on the proper path to financial freedom.

Be Smart with your Credit Cards– While there is nothing more dangerous than a freshly freed college kid with a credit card, letting our cards get the best of us is something that is certainly not solely reserved for the youth of the world. That is why a credit card should be looked at as a means to pay for emergencies much more than a false sense of purchasing ability.

Additionally, it is wise took into the many different options available to you as different cards offer different reward programs; still, experts recommend that it is best to use a card with benefits for big purchases only when you have the necessary funds elsewhere to pay for it. Remember, extending yourself, even for one billing cycle, can subject you to significant interest penalties.

There have been many studies done to show that swiping a card receives much less consideration then parting with cash; there’s just not as much of an attachment to it. Do not be one of the many who blindly swipes each month with no concept of the final bill until it hits their inbox.

Build Your Savings Early and Contribute Often – It’s always smart to start putting a little money to the side for savings the moment you begin to consistently earn a paycheck. If you are younger, it’s typically a fund for summer vacation or books in college, but as you get older, the concept of savings evolves and takes on a whole other level as both a retirement and emergency fund.

While it is not only fun, but important to live in the now and enjoy life, you should also begin pooling together anything you can spare to start a proper account as soon as possible. From there, set aside a small amount every other paycheck or bonus check to help grow the fund. Remember to keep in mind the most important rule of maintaining a savings account, though; the fund is for savings, not for spending!

Know Your Realistic Price Range for EVERYTHING– Whether it is the clothes you wear, the car you drive, or even the amount of times you go out to dinner, it is absolutely imperative that you know your true limit for spending. It’s easy to get carried away and follow trending styles or overdo it while out at the bar or at the game with your buddies, but haphazardly spending money can quickly put you in a financial bind.

That is why it is very important to establish a base line cost for common items and an understanding of certain situations, if any, allow for you to deviate from them. It’s okay to treat yourself on occasion, but don’t let it become too much of a habit until you can fully afford to do so. Playing it smart during routine purchases will allow you to keep more money to the side for big one off situations like buying a home.