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Tips For Paying Off That Holiday Debt

By Jennifer Rossettini, CFP®

Shoppers in the U.S., on average, incurred $1,054 in debt over the 2017 holiday season. If those shoppers chose to pay only the minimum payment of $25, they would still be paying off that debt (until 2023) and, at the average interest rate of 15.9%, would end up paying a total of $500 extra in interest. If you find yourself with unwanted debt once the 2018 holiday season winds down, you may be wondering what to do about it.

The first step is to take an inventory of your debt. For each credit card used, write down the outstanding balance and the interest rate. Once you are armed with that information, you can decide where you want to begin. Logic often tells us to pay off the highest interest rate cards and/or largest balances first, and that is often the best course of action. However, there are some reasons you may want to start with the lowest interest rate cards. For example, those retailers that get you to buy big ticket items with the promise of 0% interest during a promotional period often have a catch: they defer the interest, and if you do not pay off every cent of that purchase before the end of the promotional period, the retailer will add all of the interest that would have accrued onto your balance. Another reason for paying off smaller balances first is that it motivates you to continue onto the next one.

 Other than deciding which debts to pay off first, one needs to determine where the extra outflow will fit into their budget. One consideration is to look for ways to generate more cash. For example, if your credit card offers a rewards program, you can often use cash back rewards to pay down the balance or even trade frequent flier miles for cash. Jean Chatzky also suggests selling your unused electronics, reselling unused gift cards, checking for unclaimed money, cashing in on insurance policy dividends and rewards, and taking advantage of shopping portals and cash back applications.[1]

Another consideration is to look for ways to reduce other expenses in order to free up some extra cash to pay off those debts. For example, packing lunch instead of buying lunch every day could save you $50 per week or $200 per month. Try not to add to the debt during this pay back period. Avoid using your credit card to make up a budget shortfall and instead use “envelope budgeting”: set aside actual cash to pay for certain variable budget items, such as eating out, entertainment, transportation, etc., and when that cash is gone, spending on that item ends for the month.

Of course, the best way to avoid a similar problem next year is, once this year’s debt is paid off, take advantage of the above budgeting techniques and save that extra cash for next year’s holiday spending.


[1] https://www.nbcnews.com/better/business/how-pay-holiday-debt-faster-ncna836256

Ask Kit Kat – Loyal Dog in CA

Hook Law Center: Kit Kat, what can you tell about Madison, the  Anatolian shepherd dog, who reunited with his 75-year-old owner after the California Camp Fire?

Kit Kat: Both are Anatolian shepherds, large dogs with thick fur, who need a lot of space. She says, “These dogs are livestock guardian dogs, they do not do well in heat, they do not do well in small enclosures. They protect their property.” Temporarily, she and her husband are living in a mobile home park, so the dogs are staying at their home site alone, with Gaylord bringing them their food on a daily basis.

According to Marlene Johnson, who owns Anatolian shepherds and founded a Facebook group called Livestock Guardian Dogs and Positive Training Methods, “Madison is a perfect example of a livestock guardian dog. He braved a natural disaster and went right back to where he belonged and stayed there until his owners and working buddy returned.” How he survived the fire is a mystery, but one of the rescue workers hypothesizes that he somehow managed to outrun the fire, and then circled back to his home area. Quite a dog, wouldn’t you say? (Hilary Hanson, “Loyal Dog Found Guarding Home Weeks After Wildfire Burned It to the Ground,” Huffington Post, Dec. 10, 2018)

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Posted on Monday, December 31st, 2018. Filed under Senior Law News.

No! You Cannot Disinherit Your Spouse.

By Shannon Laymon-Pecoraro, Esq.

Many clients come to our office and want to limit an inheritance to, or completely disinherit, a spouse, due to a number of reasons.  It could be that they want to ensure their children are provided for after their death, or that the spouse does not want to disrupt eligibility for public benefits. Regardless of the reason, the law clearly outlines rights your spouse has to your estate. As a result, with few legal defenses, such as abandonment,agreement or murder, you cannot completely disinherit your spouse.

Under the current law, a spouse is entitled to a percentage of your estate based on the length of the marriage,with the maximum percentage vesting after fifteen years of marriage. The elective share calculation is based off the decedent’s augmented estate, which takes into account not only the assets in the probate estate, but accounts for such things as the value of assets in the spouse’s personal estate, assets received by the spouse outside of the estate (for example, a fifty percent interest in a house that was held jointly), and the value of assets received by others before and after death. Historically, the value of the elective share was required to pass outright to the spouse, but, under current law, you can satisfy this claim by having such share pass to a marital trust, and if the spouse is incapacitated, to a special needs trust.

In addition to the claim for an elective share, a spouse may have other claims and allowances. The spouse may claim a family allowance, which may be paid as a lump sum not to exceed $24,000 or in periodic installments not to exceed $2,000 per month for one year.  There may also be a claim for exempt property and a homestead allowance, each valued at $20,000.

Because various factors and deadlines apply to the various items addressed herein, you should not attempt to file these claims on your own. In some circumstances, if you claim an elective share in lieu of the gift provided to you under a Will, you may receive less than was originally provided to you. Similarly, planning around the elective share can be complicated and a failure to seek qualified legal advice could result in an unintended expensive legal process. Many experienced estate planners will be able to help navigate these issues and recommend alternative solutions. 

Kit Kat

Ask Kit Kat – Talking Blue Jay

Hook Law Center: Kit Kat, what can you tell us about the blue jay at the Virginia Aquarium & Marine Science Center in Virginia Beach who meows like a cat?

Kit Kat: Well, it’s a male and his name is Chi. As a hatchling, he was raised by an elderly woman who mistook him for a cockatoo. There were several cats in the household, and he picked upon their meowing. After a while, the woman was no longer able to care for her pets, so she asked a wildlife rehabilitator to find the jay a home. The rehabilitator realized immediately that this was a wild bird who had been raised in captivity and would not make a good candidate to be released outdoors permanently. So Chi was offered a home at the Virginia Aquarium & Marine Science Center. He lives in the Upland River room near the front entrance of the main building, along with some turtles, fish, ducks, and other birds native to the area.  He’s been there since 2009.Chi is estimated to be about 16 years old.

Chi is extremely social. He has a girlfriend—another blue jay—whose name is Nigel. He and Nigel happily greet visitors and munch on seeds and meal worms, staples of their diet. Not only can Chi make cat-like meows, but he can sing half a musical scale, as well as make a catcall sound—when he sees someone he deems attractive. He’s quite a character! (Stacy Parker, “Kitty twitter—Blue Jay at Virginia Aquarium, raised as a pet, meows like a cat,” The Virginian-Pilot, Nov. 22, 2018, p.1 & 4)

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Distribution of This Newsletter

Hook Law Center encourages you to share this newsletter with anyone who is interested in issues pertaining to the elderly, the disabled and their advocates. The information in this newsletter may be copied and distributed, without charge and without permission, but with appropriate citation to Hook Law Center, P.C. If you are interested in a free subscription to the Hook Law Center News, then please telephone us at 757-399-7506, e-mail us at mail@hooklawcenter.com or fax us at 757-397-1267.

Posted on Thursday, December 13th, 2018. Filed under Senior Law News.

Don’t Become a Victim of the “Grandparent Scam”

By Emily Martin, Esq.

What is the “grandparent scam” and how does it work?

Unfortunately, seniors are often the targets of scams looking to cheat them out of their money – often to the tune of tens of thousands of dollars. Although it has been around for years, in recent months, there has been a resurgence in the number of seniors falling victim to the “grandparent scam.”

Typically, the “grandparent scam” works like this: you get a call from someone pretending to be your grandchild. This person explains that she is in trouble and needs money immediately. Perhaps she is in jail and needs money for bond or is stuck in a foreign country in needs money to get out. Typically the caller will include enough detail to make the story seem realistic. The “grandchild” will often ask you not to tell your child (their parent) that they are in trouble. They ask you to wire money to a specific location or to give it to a third party, who is usually someone posing as a lawyer or police officer. Once you wire the money, the scammers break off all contact – usually making it impossible to recover your losses.

There are many ways these scammers choose their targets. They may purchase “lead lists” with information about older people or people they can get lots of personal information about. Often, scammers peruse social media to find information about potential targets, such as whether they have grandchildren or how old they may be.

How to handle the scam it if happens to you

The first and most important step to take is not to panic if you get this type of call. Often the scammers call in the middle of the night, when you may not be thinking clearly and may be more likely to believe what you hear. Always verify the person’s identity by asking questions someone else could not answer – such as the name of their first pet. Call other family members to see if they have heard from your grandchild – or even try to call your grandchild’s personal telephone to see if they are okay. In no circumstances should you send money until you are absolutely positive that your grandchild is in trouble and that the money is going to the correct party.

If you realize you have been scammed after you have sent money but before it has been picked up, you may be able to retrieve it. Unfortunately, if the money has already been picked up, it is most likely gone for good – along with the scammers who took it.

How to protect yourself from being targeted by scammers

In order to prevent your email and computer from being hacked, use a firewall and anti-virus/anti-spyware software. Don’t open email attachments from strangers or even from friends and family when the attachment seems strange.

Make sure all of your social media accounts are private, so that scammers cannot see your personal information. And if you receive a telephone call from a number you don’t recognize, it may be best to screen the call until you determine it is legitimate.

 

Kit KatAsk Kit Kat – What Can Horses See?

Hook Law Center: Kit Kat, what can you tell us about how horses see color and distance as compared with humans?

Kit Kat: Well, this is extremely interesting. Some new information is coming out of Britain. Research at the University of Exeter indicates that horses neither perceive color nor distance in the same way that humans do. Obviously, improving our understanding could not only make it safer for the horses, but for humans, too, who are riding or jumping on these majestic animals.

To examine how horses actually see, researchers at the University of Exeter did some research. What they found is that horses cannot tell the difference between reds, like true red and orange, and green. Therefore, the ubiquitous use of orange on crossbars and take-off boards for fences and hurdles is probably not very helpful for the horse. They see orange as green, so to use it as a marker is absolutely no help at all. Humans have three types of cone cells in their eyes, while horses only have two.

Also, according to other scientists such as Janel L. Jones, who has a Pd.D. in cognitive science and wrote an article in Equus magazine, horses cannot see items from as far away as humans do. What a human can see at 30 feet from an object, a horse can only see that same object when at a distance of 20 feet. With the speed at which horses are travelling, that could make a significant difference. Poor color perception combined with poor depth perception could be responsible for some of the accidents which occur at a track.

With this new information in hand, the British Horseracing Authority (BHA) will begin experimenting with different colors in some of their training locations and gathering input from trainers and riders. Already the use of white and yellow for fences and jumps has yielded improved data for the way the horses jumped. “If it’s clear that horses are confident, respectful of the fence and jumping cleaner and better, then the authority will look at rolling it out to a number of racetracks.” Traditional orange marking may be a thing of the past! Stay tuned.  (Bianca Britton, “New research on horse eyesight could improve racecourse safety,” www.CNN.com, October 23, 2018)

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Distribution of This Newsletter

Hook Law Center encourages you to share this newsletter with anyone who is interested in issues pertaining to the elderly, the disabled and their advocates. The information in this newsletter may be copied and distributed, without charge and without permission, but with appropriate citation to Hook Law Center, P.C. If you are interested in a free subscription to the Hook Law Center News, then please telephone us at 757-399-7506, e-mail us at mail@hooklawcenter.com or fax us at 757-397-1267.

Posted on Monday, December 10th, 2018. Filed under Senior Law News.
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