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Early Retirement Withdrawals – How and When to Conduct a Withdraw

IRS data has shown that Americans lose approximately $5.7 billion per year on early withdrawal penalties when they take out funds from their 401k Retirement Plans or IRAs before meeting the minimum age requirements (59 ½). In 2020, Section 2202 of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) created an exemption for early distributions related to the coronavirus pandemic in which individuals could withdraw up to $100,000 from their retirement accounts without being subject to the 10% early withdrawal penalty (though they would have to count the distributions as part of their income for tax-reporting purposes for the next 3 years). To qualify for the no-penalty early withdrawal – which was extended into 2021 thanks to the … Read more

Taxes Working From Home – 3 Important Considerations During COVID-19

by Hank Coleman

As millions of taxpayers prepare to file their 2020 taxes, a question that many telecommuting employees, independent contractors, and freelancers are wondering is: which of my remote work expenses can I write off on my taxes, and how much? Here’s what you need to know about taxes working from home. Taxes Working From Home The answer varies widely, depending on your employment classification, expenses incurred during the pandemic, whether your employer reimbursed you for remote work-related expenses, and which state you live in. To help you understand what your tax situation might look like this year, here are three of the most important things to know before filing your 2020 taxes: Employees vs. Independent Contractors The Tax Cuts and Jobs … Read more

Pros and Cons of Putting Less Than 20% Down Payment on a House

by Hank Coleman

Why I Don't Mind Losing Money as a Landlord

For decades, 20% has been the golden standard for down payments on a home, but is that still the case today? With more and more Millennial consumers entering the housing market – many of them already averaging $27,000 in non-mortgage debt – lenders have increasingly offered favorable options to help individuals and families achieve their homeownership dreams without requiring the full 20% down payment beforehand. After all, a 2020 report from the National Association of Realtors found that a whopping 30% of 22-29 year-old homebuyers agreed that “saving for a down payment” was the hardest part of the home-buying process (20% of 30-39 year-olds agreed with this statement as well). Of those survey respondents, 59% of the 22-29 year-olds and … Read more

Top 4 Key Financial Planning Strategies for Dual Income No Kids (DINK) Couples

by Hank Coleman

The costs of having kids have skyrocketed over the past several years, as expenses like childcare, education tuition, and other essentials continue to outpace average inflation rates. For dual income no kids (DINK) couples, kid-related costs won’t factor into your financial planning efforts for the most part, which means your budget, savings goals, and investment strategies will look pretty different from other families’ finances. Regardless of the reasons why you’re child-free, it would be best if you still had a solid financial strategy in place to ensure you and your partner are secure in both the short and long term as a dual income no kids (DINK) couple. You may not need to worry about affording childcare, contributing to 529 … Read more

Top 5 Essential Ways the COVID-19 Pandemic Will Change Personal Finance

by Hank Coleman

When Covid-19 first hit the U.S. in the spring of 2020, we witnessed one of the largest and fastest unemployment spikes in American history. While the stock market has rebounded to all-time highs during the pandemic, Main Street has been spiraling downward. Covid will change personal finance. The Center on Budget and Policy Priorities estimated that 11% of adults in the U.S. didn’t have enough to eat over the past 7 days (compared to 3.4% of adults who reported insufficient access to food over the course of 12 whole months before the pandemic). The CBPP data from January 2021 also showed that 21% of adults were behind on rent, and 35% had reportedly struggled to pay for typical household expenses … Read more

The Top 7 Finance Books Money Q&A Readers Are Buying on Amazon

by Hank Coleman

Over the past three months, Money Q&A readers have bought several personal finance books through the blog’s Amazon affiliate links. I thought that it would be fun to look at these seven. It’s no surprise that most readers are buying are part of my Top 10 Personal Finance Books list. The list shows the books that I think should be on everyone’s bookshelves and nightstands next to your bed. You can see the full list here. These Top 10 Personal Finance Books are the ones that have meant the most in my life. They’re the ones that I have highlighted passages, dog-eared pages, and reread over and over. If you haven’t read them, I definitely think you should push them … Read more