Late Credit Card Payment Fees

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When I became a widow I had a credit score of 800.

My husband liked to sign up for credit cards.  At his death, there were 33 on his credit report. I started canceling the credit cards in his name. Of course, I was the second card holder on many of those cards.

As I talked to financial advisors, going to classes on financial management and credit, and started purchasing a house, I was advised to STOP CANCELING THE CREDIT CARDS – that it would have an adverse effect on my credit score. Fine. So I stopped. The credit cards are in a drawer. I really don’t know where my credit score is right now. Last time I checked (when I got the mortgage on my townhome) it had dropped to 760.  I suppose I should go to the bank and ask if my current mortgage holder will run another score for me.

Then today, when I picked up the mail, I had a letter from American Express that my last payment was late, and it had triggered the Penalty APR (27.24%). American Express has the fastest turn-around of all the cards/payments that I am required to make. After returning from our cruise in December, I realized that I was close to a late payment on AmEx, so called and made the payment on the phone. I also changed my address in their files.

Imagine my surprise when I got another bill at the old address, and the payment by phone was not recorded as timely.

Soooo…I called American Express.  On the letter where I received the notice of “late payment” there was a number to call to pay online.  However, they could not assist with my late penalty challenge.

So I called the number on the regular monthly bill I had received.  This card is the required Costco Amex. That bill actually had a “Customer Care and Billings” number listed. Please keep in mind that Costco is one of my favorite vendors. The stores are well run, their CEO takes a reasonable salary, the staff are well compensated. I was not surprised that there was a Customer Care number. And I was not disappointed.

After passing through three or four suggestions that I handle my business by computer, I actually was able to talk to a very polite, efficient and effective young man. I explained my challenge with the address change.  He confirmed that the new one was now the one of record, that the latest statement had still gone to the old address , but all future correspondence would be correct.  I also explained to him that as a new widow I was experiencing some challenges with creditors as the changes in address and primary account holder were being made. He could see that I had been a cardholder for sixteen years, and that my payment record was excellent.

Now here was the amazing part – I tried to pay the amount on the statement.  He could see that the prior statement had been paid, and that the only new charge was the $26 late payment fee.  He waived the fee, and confirmed that there was no current balance. He also confirmed that the 27.24% late penalty APR would not go into effect, and that no report would be made to the credit bureaus. It will be interesting to confirm that in the next month or so.

Through all this my little black kitty has been sitting beside me, walking across the keyboard, crawling over the shelves/printer, and making me laugh.  She just somehow knew that I needed some comic relief.

Selling and Donating Cars

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Last March, ten months ago, I found exactly the car that I was looking for – A red Subaru Forester (see the post A New Car). I bought it the day after it magically appeared on the dealer’s lot close to my new town home (although I had NOT purchased the house yet). It has been the perfect car to meet my needs.

At the time that I bought the Subaru, it made me the proud owner of FOUR cars…the one that I now drive, my daughter’s ancient Mazda Protégé, the little red Mazda 6 that had been my husband’s 60th birthday present to himself, and a vintage Toyota Previa van.

In that ten month period, I had disposed of the Previa by donating it to a local charity. They provided a letter stating that they were able to use it in their exempt purpose, even inviting me to the blessing ceremony, where the keys were handed over to the new owner. The Internal Revenue Service has very specific rules on the deductibility of donated vehicles (See IRS Notice 2005-44). It explains that if the charity resells the vehicle, the donor’s deduction is limited to the actual sales price of the vehicle when it is sold by the charity. However, the donor may claim a deduction of the vehicle’s fair market value if the charity makes a “significant intervening use of the vehicle, such as using it to deliver meals on wheels”.  The difference in the deduction is between $250 or $2000.

AND – on Friday, my brother was able to sell the Mazda 6 to CarMax. One of the great gifts I have received in the last ten months is a series of meetings with two professionals. One is a CPA who has been a friend and colleague for many years.  The second is a Wealth Planner whose clientele include a significant number of widows. Even with my background in finance, I do not know how I could have managed the financial challenges without their continuing sound advice. At our last meeting, I was bemoaning the fact that I had not been able to find a buyer for the Mazda 6.  Both suggested taking the car to Car Max (they had both done that in the past).  I had not even considered that option, thinking that because they were going to resell the car, the price that they offered would be very low.

HERE ARE THE FACTS related to my Mazda 6.  When I purchased the new Subaru, they offered me only $4500 to trade in the Mazda.  Last week at CarMax, I was offered $8000 (and that was ten months later!) So…DO NOT automatically trade in an older car when purchasing a new one! Make sure you at least get a quote from CarMax! They made an offer that was good for seven days.  My brother was selling the car for me. It provided enough time for me to sign the title and send it overnight it to him in another city. Now, strangely enough, when he presented the notarized title, they demanded a Power of Attorney as well (which I also sent by FedEx).  We have an excellent Credit Union in town where I keep my more liquid funds.  I had walked in the first day with the title, and they notarized it for no fee.  The SECOND time I went in, the attorney I had spoken with the day before said, “They don’t need the Power of Attorney!” I just smiled at him and asked him to please provide the document, which he did, again for no fee.  One thing that I have learned over the last ten months is that it is much simpler to provide information which people request than try to convince them that they really don’t need it!

I currently own only TWO cars, instead of FOUR.

Now, if I could just reduce the number of houses from two to one I would be in great shape!

The House – Part 1

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A house is so many things when a family has “grown up” there.  When we moved to our current home, my son was 6, and I was pregnant with my daughter. My son is now 31, my daughter soon to be 24. It is a rambling four bedroom, 2800 sq. ft.  house – and now I am the only full-time resident. The real estate market is higher now than any time in the last eight years. The house next door (smaller) just sold for a surprisingly high amount.

So – I have today requested a formal independent appraisal from a firm not related to any real estate agency. I have not received the estimate yet, but assume the appraisal itself will cost about $500. In the next couple of days I will interview three real estate agents and choose the one that is most willing to meet with my requirements – (no major cost to prep for sale).

To make life more interesting, a condo that I have been watching in another city (in the mountains, close to my sisters) has just gone on the market. My sister looked at it yesterday and confirmed that it is in move-in condition. I am planning to go look at it this weekend (it is about 5 hours away), and make an offer of earnest money if necessary to hold it until I can get there.

But, my daughter has not yet been accepted at the transfer school of her choice, and it is a month before she would start there (I do expect her to be accepted, but am a little disconcerted that she has not been confirmed yet).  It would take me much longer than that to “de-clutter” 30 years of accumulated minutiae (i.e. junk – you know, 15 Christmas boxes, 1000 books, files from accounting clients over a 20-year career). Help is on the way on that front.  Monday a cousin who has been a military family (moving every 3 to 5 years) is coming to help with the tossing process.

I love this house – the modern, large kitchen, a great screen-in back porch where it sounds like you are in an aviary on early summer mornings, a great, large living room that my baby-grand piano doesn’t dominate, a two-story playscape in the woods built by the four brothers-in-law (including my husband) .  My daughter definitely does not want the house to be sold–she’s lived here all her life. But I do not love the traffic of a large city, being five hours from my family, and an old house that needs a good clean-out and painting.

It is time to make the change, now probably sooner rather than later, though hard on us all.

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!!

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.

Menacing Medical Bills

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This morning was an amazingly positive experience. After talking with a cousin that assists with insurance challenges, I attacked the four medical bills for my husband’s fatal heart attack –  LabCorp, cardiologist, ambulance, hospital – about $5000 outstanding. After making it through all the telephone trees, I was able to talk to a person on the first call with all of them except the hospital.  There, I had to wait for a return call, then navigate another phone tree to finally talk to a person. Altogether, it took about an hour for the process with the four bills. Thankfully, my husband’s insurance seems to be paying everything in two tiers.  He was a state employee, and Blue Cross was the primary payer.  AND, because he was over 65, Medicare was the secondary payer. Prior to this morning, none of the billing entities knew about the Medicare. Between the two insurers, what I heard today was that there will be no outstanding balance once Medicare makes their payments. Unfortunately, when my husband died, we also lost our health insurance.  The only way that my 23-year-old daughter and I were able to get reasonably priced coverage was through the Affordable Care Act. My husband was with the same employer for 32 years, while I changed every two or three years to work in nonprofits with infrastructure challenges. Through the Act we have gotten excellent, reasonably priced coverage . The one negative outcome is dental insurance.  We have the best dentist in the country and I am not willing to give that practice up to use one available through the Affordable Care Act. I have decided to stay with our great dentist (for 20 years) and gamble that there will be no major catastrophic event. This process has shown itself to be a continuation of the uncanny coincidences and positive experiences that have happened since I became widowed.

The Big International Bank

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I have finally decided to fire the Big International Bank.

I have too many bank accounts, and my needs have changed. For a couple of years I have kept my accounts opened at the Big International Bank (henceforth “BIB”), thinking that perhaps I would need that flexibility again, but today have decided that I can let it go.

My favorite BIB interaction happened when I was traveling in Alaska a couple of years ago.  At 4AM my BIB banker called because they had been bought out, and my bookkeeper (NOT in Alaska) had attempted to complete a transaction that did not meet the new conglomerate’s criteria. As politely as possible, I first told my banker friend that I really did enjoy waking at 4AM, and yes, please do give my bookkeeper the access she needed to complete the transaction.

Last summer another BIB moment came when I called my BIB to tell them that I was taking their credit card to Europe. Instead of thanking me for the information, they asked to speak to my husband so that he could verify as the primary account holder—even though I was the one who opened the accounts, and was indeed the only person who ever talked to them about our finances!  I (not very politely) informed him that I would NOT ask my husband to come to the telephone. Nor would I be taking his card to Europe with me nor, indeed, ever using it again! Even though I am now the de facto Primary Account Holder, my card and my money will be l housed in a less male-centric environment.

In stark contrast, yesterday my daughter and I spent the better part of an hour opening a new account for her at the State Employees Credit Union (so she could close her BIB account). It was a delightful experience – and not a word was said about my lack of a y chromosome.  I cannot use their credit card in Europe, unfortunately… but I have found that need met through other means.

Interviewing Financial Advisers

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One person that I hope to find is an adviser that is honestly interested in assisting women to take charge of their assets, whether they are financial, real estate, or other property. This would involve some sort of tool that, with a minimum of detailed input, would give the client a good feel for the assets she holds,  their true value, and their liquidity. Then when a decision about purchases, investments, or sales was required, she would be able to make it with a complete picture of what that would mean to her over an extended period of time. If she had to raise cash, she would have already planned for its source, anticipated when those needs might occur, and their true cost in the short and long term. So far, I have met with three different representatives, presenting them with this challenge.  It will be interesting to see what results my search yields!

The first post: The Death Certificate

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Tomorrow it will be four weeks since my husband died of a sudden heart attack.

Through this blog I will track through the processes required as I encounter challenges and surprising supports from friends, family, my husband’s former employer and the rest of the legal system surrounding a death.

Yesterday, I finally received the death certificates – after going through two required corrections. MANY things cannot happen without death certificates, the most important of which is beginning the process for collecting on life insurance policies.

Cash flow has been my biggest challenge so far ,besides getting out of bed in the morning. Seven days before my husband died, my temporary job ended. He was on Spring Break from teaching, so we had a nice leisurely week together.  Luckily, a family member loaned me enough cash to get past the the first 30 days (my husband died at the end of the month, but his salary for the month of March is going into the Estate). There was an employee death benefit – but it takes six weeks to process after receipt of the death certificate.

So – I am writing this knowing that the first big hurdle is past.