A Great Meeting with the Finance Guys

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Today I had a great meeting with two financial advisers who have been working with me since a month after my husband’s death.  One is a CPA and was a colleague many years ago in my first position in an accounting firm. The other is a younger financial manager interested not only in financial planning, but also in helping clients make wise financial decisions in their lives.

I have presented a financial plan for myself, with the benefit of their knowledge and guidance, and now am charged with developing a curriculum for widows to help with money management. That is my goal for the next month – a community college non-college curriculum targeting new widows, especially those who have had little responsibility for their finances until the death of their spouse.

The text that I will be using is an excellent resource, Moving Forward on your Own by Kathleen M. Rehl (also a widow). The planning tool will be in Microsoft Excel, so no commercial software package will be required. The task is to make the course relevant for all widows, regardless of their financial background.  Even as a CPA, it has been a challenge to corral all the moving pieces into a new model that will provide basic decision-making data, and yet simple enough for periodic updates.

Today, the three of us sat around the table discussing our different methods of basic financial management.  We had three distinct styles: One of us used Quicken, downloading all financial transactions from the bank into the software. The second made most transactions through his credit card, doing the management piece monthly when the credit card statement arrived. I pay my bills through online bill pay, sometimes writing paper checks, and do most day-to-day business by cash (giving myself an allowance every week as a budgeting tool).  As we discussed these three very different styles, we realized that my challenge will be to make the course relevant to all three of these money management styles, including the widow who has basically had no financial responsibility during her marriage.

Wish me luck!!

A new college?

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My daughter is a lovely, gifted, bright person, with a diagnosis of high functioning Asperger’s Syndrome.  College has been a challenge, but now she seems to have found her career as she trains to become a sign language interpreter.

She entered a community college thinking that if she was successful in that program she would have an Associates Degree in two years (after which she could get a Bachelor’s Degree, which she needs to become a certified interpreter).  What we didn’t know was that there were two years of prerequisite sign language classes required before students are supposed to be able to have the skills to enter the interpretation program (which had an excellent reputation). After two years in preparation, my daughter ultimately had to take a nationally proctored exam. To continue to the Interpreter level classes, you must pass the exam.  Given once a year, it was administered two weeks after her father died.

Results did not come for three months.  She did not pass, nor did anyone in her class that did not have a deaf individual in their immediate family (i.e., if you did not know how to sign before you entered the program, you did not pass).

So, now we are on a crash course to transfer to a state university with an excellent program.  The two-year degree will not be an option, but this appears to be the best path for now. So – last week we completed the on-line transfer application and ordered transcripts. Tomorrow we go to campus to talk to faculty, tour the campus, and ask about housing.

There is no easy answer here, but hopefully the new plan will move everything in a forward direction again.

The “Social Security Workshop”

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One of the important pieces of money management after a spouse dies is the coordination of both the husband’s and wife’s benefits.  I signed up for a workshop last Saturday that I hoped was going to explain (so that I could understand) how the coordination would work to the surviving spouse’s best advantage. The person offering the workshop was quite knowledgeable, but had a preprinted “booklet” and was using slides that had different material on them, so I was having a hard time keeping up with the details. After about an hour and a half I had pretty much decided that this was just another presentation that did not take the audience’s comprehension into consideration when presenting the material. Because I have some experience teaching adults, I find this especially frustrating.

But with thirty minutes to go, the presenter turned to the true topic of the entire two-hour presentation: A simplistic, extremely pessimistic financial model which shows the “baby boom” bankrupting the treasury resulting in the eventual loss of the Social Security System. His solution to this challenge is to invest in annuities! (ALL of your money in annuities that would survive the collapse of the Social Security System and a stock market major adjustment).

Now, I have to admit that this is one possible scenario with the tsunami of graying baby-boomers, but I was truly incensed that his ONLY offered solution was to purchase annuities which – wait for it – he happened to sell, and he would be glad to schedule an appointment before you left that day, adding “The appointments are going fast since the classes have been so well attended.”

This very topic is one that I have been reading about for a while, especially the Social Security portion since it will be an important part of my financial stability for the coming years (and I will write about it later when I feel I can present a balanced view of facts).

BUT I can ASSURE you that investing ONLY in annuities is NOT the answer.

There are many knowledgeable people providing excellent information to assist those of us who are retiring.  There are fewer people addressing the specific needs of widows, which is the reason I have entered on this project. But PLEASE be careful when someone offers “the only solution” to a complex problem.  Buyer Beware!!

The Cars

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The letter came Saturday afternoon about 4:00 from the Department of Motor Vehicles (DMV):

“DMV has received the fees submitted for the issuance of a plate and/or sticker for the vehicle listed above.  However, our records indicate that this vehicle has not been inspected within 90 days of the plate expiration as required…this prohibits the vehicle from being registered until the vehicle has been inspected.

OK – so – Monday morning is inspection time!

Bright and early Monday morning I called our excellent car maintenance shop and ask if I could come in for an “emergency” inspection.  No problem.

Ah, but not so fast!  I forgot to take the letter with me, and when the mechanic entered the information in the DMV system, it said that the car’s inspection was valid for another year.

Not long after my solo life adventure began, I took one of my three cars to this shop (which we had been using for many years) and let them know that this was the one area of our marriage that my husband had managed completely by himself.  I did not have to track on any maintenance issues at all.  My husband did everything from tires to oil changes. Therefore, I had NO IDEA what the car needed (well, somewhere in my deepest darkest memories I remember my dad telling me to get oil changes every 3000 miles).

When one of the two female owners told me this, she also asked, “Is it possible that the letter is for the other Mazda?” Ah, yes, my daughter’s (much) older car – not my husband’s little red sportster. Such insights are one of the many advantages in taking ALL of your cars to the same mechanic all of the time…even for oil changes…which I had already decided to do earlier.  All the records in one place, someone checking for routine needs on a regular basis.

So…..I get to go back this afternoon with the other Mazda (and the letter) and see if I can become “legal” again.

Father’s Day with the Kids

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Of course Fathers Day was going to be a challenge.  Both of my children are adults. That makes the issue of the recent loss of my husband more complex but definitely still present.

My son teaches High School and coaches soccer, so the weekend agenda began with the World Cup Games. That was a great help.  He enjoyed himself watching expected and unexpected victories while my daughter and I drifted in and out, participating as the tenor of the games dictated.

Saturday night we all went to dinner at a great restaurant that the four of us had visited many times with bitter-sweet memories. Sunday my daughter’s mission was to fulfill a promise she had made to her Dad – to dress our one-year-old cat in the jersey of her dad’s favorite college team.   Around this activity I tried to make quiches for “brunch.”

The two required trips to the college gear store (of course the first jersey didn’t fit!) kept both my son and me engaged with my daughter for the rest of the afternoon.  Brunch turned into dinner as we settled in for a World Cup game (the quiches surprisingly delicious dispite the disruptions).

All-in-all, the weekend was successful as we all came together and created new memories. It will not be easy for a long time, and maybe never, but we will keep walking those new paths as a family.

 

Menacing Medical Bills (2)

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Today I received a follow-up from an earlier call related to outstanding medical bills.  The Hospital’s initial bill showed a balance due of $637. I had called and told them that my husband was enrolled in Medicare Part B as well as his Blue Cross Blue Shield Insurance (BCBS), an answer which satisfied all the other outstanding medical bills from the first calls.

My total emergency room (ER) Explanation of Benefits (EOB) showed two amounts not paid by insurance –

Copayment of $291

Coinsurance of $345.

The Copayment is a fixed amount charged whenever you use a particular service (like that $20 you have to pay each time you fill a prescription).

The Coinsurance is a percentage of the total cost of the service (in this case, about 10%).

Next I called the Human Resources Department of my husband’s employer (he was a State employee) and asked if his share of the ER bill at $637 was correct. The State provided the BCBS coverage.  I knew it had required him to enroll in Medicare Part A (it is available premium free if you have 40 calendar quarters of work in which you paid Social Security – my husband had 40 years with the State).

The HR department provided the “big picture” – Part A pays for inpatient hospital visits, Part B helps with other medical services, and Part D assists with prescriptions.  He had Part A only (free). The Part B premium is $105 per month, so he did not have that coverage.

Sooooo…it looks like the copay and deductible are “reasonable” at 10%, so I am pulling out my checkbook. I am very glad it was NOT twenty percent!

 The Lawyer and Avoiding the Estate Account

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My husband and I were frugal throughout our careers, and always contributed to any plan that offered an employer contribution. He was a community college instructor, I worked with nonprofit organizations. We anticipated both of us living to the age of 80 (and beyond), so we saved our money anticipating 20 to 30 more years with income only from his teacher retirement, Social Security, and our savings. We have accumulated an amount that I assumed would throw me into an Estate Account requirement (for those who don’t know, if the deceased spouse has accrued more than $30,000 in separate assets, the surviving spouse generally must establish an Estate Account).

I applied to the IRS for a Tax ID number for said account. However, thanks to the guidance of my lawyer, that number will not be needed. Fortunately, we had set up all our financial assets (investment account and checking/savings accounts) as joint with right of survivorship, so all of the assets passed to me, avoiding the Estate.  The joint accounts also did not count toward the $30,000 “year’s allowance” for widows in my conservative Southern state.

In our state, the house also passes to the surviving spouse, not counting toward the “allowance” (providing husband and wife purchased the house as a couple). What I have left are three cars, my husband’s last paycheck (written after his death) and a few other small odds and ends.  I will have to take a trip to the state Department of Motor Vehicles, with a Death Certificate, to transfer title of two of our cars to my name – still not meeting the $30,000 threshold (the cars are quite ancient with very low market values).

This is a MUCH less arduous process than I initially anticipated – thinking I would have to set up an Estate checking account, leave it open for a year to satisfy claims against the Estate, and make a public declaration.

I also have a great lawyer: a young woman who is generous and efficient with her time, even returning part of the initial fees she collected as “not utilized”.

There is yet another benefit of our relationship.  The second week after my husband died I had the substantive meeting with her (please note that I called her at 9:00 AM the morning after he died for specific guidance on anything that needed to be done immediately, which she provided, graciously.  It was Sunday morning). My late-twenty-something niece was visiting, so she accompanied me to the meeting with the lawyer.  My niece is in one of the longer-term arrangements common to young people.  She and her boyfriend co-habit an apartment, but there is absolutely no legal commitment/relationship between the two. When we left the meeting with our lawyer, her first comment was “now I see why people get married.” An astute observation.