tim-hudson

The “B” Word

Mon, 06 Feb 2023 16:02:02 GMT

The "B" Word

by Tim Hudson

Budgeting. On the best days, it can feel like a four-letter word.

After a loss, it seems impossible. But I’ll get back to that.

Chocolate & Coffee Creamer

For many years I have struggled with carrying around an extra 20 pounds on my frame. See, I really enjoy eating. And if it’s chocolate, why stop at two helpings? To offset this eating style, I decided to work out. As long as I work out, I can eat whatever I want, right? But the pounds kept coming, and my pants kept getting tighter. I needed some help.

I hired a nutritionist, and he made me start counting calories. Ugh. I didn’t think it would do any good. I thought I knew how many calories I ate per day. As it turns out, I had no idea how many calories I was eating and what the caloric content of some of my favorite foods were. My favorite coffee creamer had around 150 calories per cup, and I would drink two cups a day. Yikes!

After a couple weeks of counting calories, I discovered which foods I ate because I really liked them and which foods I ate out of habit. I went down from two cups of coffee to one and easily cut 150 calories out of my diet that I can use for something I like more. Chocolate, anyone?

So how does this story relate to budgeting, especially after you have lost a spouse? Budgeting, like counting calories, can reveal a lot about your spending habits. You may not be aware of what you’re spending, like my coffee creamer. Hopefully these next few paragraphs will give you some things to consider that may be of benefit to you.

At First, Simplify

If your spouse recently passed away, please do not feel the pressure to come up with a budget immediately. I advise newer widows to put a lump sum in their checking account -- usually 3-6 months of what you think it will cost to pay all of your bills. Remember, this is not the time to be exact down to the penny. This is the time to have one less thing to worry about. You may wonder where you might get this money. I would advise taking it from life insurance proceeds, an investment account, or another source you may have access to. The most important thing at this time is to allow yourself to grieve.

I am not advocating spending wildly. I am just saying that paying a few late fees won’t hurt you in the long run. Giving yourself a little grace and room to breathe can be helpful when you feel like your world is upside down and you are trying to find a new normal.

Hold on Big Decisions

Also, do not make any major or irreversible financial decisions in the first 6-12 months. You may have to sell the house or the extra car, move closer to the kids, or buy an investment product you don’t understand, but all of these decisions can wait. Too often widows tend to make a permanent decision that cannot be reversed -- or reversed without great financial or relational cost. If this is something that you are thinking of doing, ask yourself: Why do I have to make this decision now? Will waiting affect the decision?

You may want to talk to an unbiased third party you trust, who can walk you through the pros and cons of these decisions. Some of the most rewarding work I get to do with widows is walk them through some of these decisions. Interestingly, most of the time when I have one of these conversations, I feel like I am the one that learns something.

Take a Look: Track

When you’re ready, I encourage you to track your receipts for one month without making any changes. Don’t curb your spending yet. Just start paying attention. Every time you buy anything -- from coffee at the gas station to a meal out with friends or family to gifts or a pack of gum at the grocery store – keep the receipts. After the month is up, put all of your receipts on a table. Go through them, asking yourself: What helps me live life to the fullest? (For me – you guessed it – CHOCOLATE.) Then ask yourself: What am I spending out of habit? Like my coffee creamer, what do you spend mindlessly that really doesn’t add to your joy? (Now, be sure you are deciding for yourself, not taking advice from a family member or some book or a well-intentioned friend.)

Once you see how you spend your money, you can make a more educated decision on what to keep spending money. You will be able to use your money on what you enjoy and what serves a purpose in your life. And you will see what you can potentially get rid of -- things that don’t bring a lot of joy to your life. If this seems a little overwhelming, it may be good to talk with a financial advisor or an unbiased friend that can be a sounding board for you.

One other thought: money, like food, has been used for a long time to cover up or mend something that you are not comfortable with in your life or you are trying to hide. Although I am not a counselor, I do believe that having these harder conversations with ourselves or someone who is trained to help you may be of great benefit.

Make it Work for YOU: Build

After you establish where you are with your spending, you can then start to build a budget based off of what your needs are -- mortgage, car payment, power bill, water bill, and things that you have to have to live. You will then see what you have to spend on discretionary items – things that make your life enjoyable and get you excited about your day. Again, I cannot stress enough -- please do not let someone influence you about what should be important to you or what you should cut out. If going to Starbucks every morning for a cup of coffee is really fun for you, and this is a way you choose to spend your discretionary money, go for it! After all, if you are ever at a Starbucks in South Carolina and see some tall guy drinking a soy latte, come and say hi.

Go with the Flow: Flexibility

Sometimes we think that once we have a budget, we have to stick with it forever. I strongly disagree with this idea. Budgets are fluid and can be changed from month to month. Some months you may spend more on gifts, some months you may travel more, and some months you may entertain more. That is the beauty of having a budget that can change every month. Most likely your needs won’t change much from month to month. It is the wants that will change. So if you know that you are going to spend more in December on gifts, maybe cut back for that month on some wants and just put them off for a month or two. You are in charge and can decide how you want to do this.

Credit Cards

The classic question: Why not put a little on your card and pay it off later? Especially during the summer months when we travel more, or during the holiday season when expenses tend to soar. If you do not have the money to cover the expenses, NEVER EVER put money on a credit card. It is a trap that is designed for you to lose every time. According to LendingTree, Americans have over $928 billion in credit card debt (1). Credit card debt is a mountain that is really hard to get out from under, so please do not ever use a credit card if you don’t have the money to pay it off every month. If you use credit cards, be careful to always have the money available before you buy something. And only buy what you were planning to buy. Avoid extra stuff that you don’t need. I personally use credit cards for the traveling perks and the points, but it is not for everyone. If you don’t like this idea, that is completely fine.

If you have gotten this far and you want some more resources, please feel free to visit our website, www.voyagefinancialpartners.com . We have many helpful complimentary resources that you can use. If you would like some help with your budget, or if you just want a listening ear, feel free to reach out. We will gladly help you or refer you to someone that can. helpinghand@voyagefp.com or 843-285-7076 .

@2023 Voyage Financial Partners, 300 N Cedar Street, Suite A, Summerville, SC 29483

Securities & Advisory Services offered through CreativeOne Securities, LLC Member FINRA/SIPC & an Investment Advisor. Voyage Financial Partners & CreativeOne Securities, LLC are not affiliated.

https://www.lendingtree.com/credit-cards/credit-card-debt-statistics/

Wills, POAs, and How Not to be Like Famous People

Wed, 01 Feb 2023 17:59:02 GMT

Wills, POAs, and How Not to be Like Famous People

by Tim Hudson

I have always been fascinated by the number of famous people who die without a will. Everyone from Picasso to Bob Marley to Michael Jackson, Prince, and Amy Winehouse and every 1980s kid’s most favorite singer, Kurt Cobain. You would think that people who have amassed as much money as these people have would have taken the time to decide where their money and belongings should go when they die.

So why do famous people and not-so-famous people postpone getting their affairs ready for when they die? I think one reason is that nobody wants to think about death. It is quite morbid. Another reason may be that it can be difficult to decide who should get all of your possessions: your kids, a charity, or your favorite pet. Family dynamics can be very difficult at times, and you may or may not be talking with all of your children. Or perhaps one of your children is more successful than the other, and you feel like it wouldn’t be fair to give the same amount of money to each. Lastly, most of us are too busy with things that have to be done today to take time for something that can be put off.

What If I Don’t?

We will cover the basics of planning how to move your money and possessions to who ever you feel should receive them. But first, let’s cover what happens when you do not have a will or trust in place when you die, like our famous friends above. Most states have laws that govern what happens when you die without a will (called intestate succession or probate ). Basically, the courts decide who should get your assets. This process can be very time consuming, tedious, and something most people never want to do again. For the sake of making this a shorter blog post and not covering every scenario, each state and situation will mean a different outcome. The rules will differ based on your state and your unique situation. If you are remarried with step kids, that will be different than a single person with no kids. The best thing to do is talk with an attorney in your state and get the best advice on your situation.

Wills

A will is the first thing most people should have. It should be regularly updated. We recommend updating at least every 5 years because life changes, and what worked five years ago may not still be working now. So what is a will exactly? It is a document that spells out how you want your assets to be distributed when you pass away. If you have minor children, it can also appoint guardians to care for your children while they are still minors. Your favorite piano, that chair you love, bank accounts, your favorite pet, and anything else you value. Think of it as a chance to leave what is important to you to the people who are important to you. It will also name an executor (usually a person or trust) that is in charge of making sure your wishes are carried out. It is VERY IMPORTANT that you keep the original version of your will. Depending on your state, you may have to go through a few more steps if you do not have the ORIGINAL VERSION.

DPOAs

The second important document to have is a Durable Power of Attorney (DPOA). A DPOA allows someone to act on your behalf, should you not be able to act because of incapacity, mental decline, or some reason that keeps you from speaking for yourself. Think of an automobile accident or the late stages of a disease like Alzheimer’s. Think of the care for your children, should the occasion arise. DPOAs are a lot like umbrellas: you may not use them very often, but they are great when you need them.

HCPOAs

The third important document is a Health Care Power of Attorney (sometimes referred to an Advance Care Directive). These are occasionally included in a DPOA, though sometimes they are stand alone documents. It allows you the opportunity to name someone that can speak on your behalf when it comes to medical emergencies or you become too ill to speak for yourself. This is very important and overlooked many times because we don’t want to think of ourselves in this type of situation where we would need one. Talk with your family if you want to be an organ donor or if you don’t want certain procedures preformed on you. Deciding to take a family member off of life support is never easy, but can be made a little easier if you have had a conversation about this before you are in that situation.

What Else?

What else is there to consider? How do you want your funeral to go: passages to be read, songs to be sung, burial or cremation, flowers or donation to a local charity you like, meals to be served or not served. This takes a lot of uncertainty off of your family when they are going through one of the hardest times of their lives, your death.

How about your beneficiaries on life insurance or retirement accounts? Are they up to date? Is your ex-wife or ex-husband the beneficiary and your new spouse is not? Unfortunately, there are too many stories of a former spouse getting an inheritance because beneficiaries were not updated. Did you give money to a charity that really matters to you? Is your money going to go where you currently want it to go?

How about your checking and savings accounts? Do you have named beneficiaries for those accounts? Most banks and brokerage houses allow for a Transfer on Death (TOD) or Payable on Death (POD) designation that allows you to name beneficiaries. This allows the money to go straight to your beneficiaries and avoid the lengthy probate process the same way it would for a life insurance or retirement account.

Action Items

So, if you have a will and your estate is in order, fantastic! If not, I would suggest taking 30 minutes to an hour with your favorite beverage and start the process by writing down who you want to get what when you pass away. Talk to the people that matter to you, and after you have thought this out, tell them your intentions. I think you will find that most people will be relived that you have taken this burden off of their plates. I would than talk with a great Estate Attorney about setting up the proper estate documents that you need. Cost tends to vary greatly by location and level of work that needs to be done. Most attorneys, though, will tell you upfront what their costs are for this type of work.

Although only an attorney can write estate documents for you, I would be happy to answer any questions you may have. Feel free to contact our office at helpinghand@voyagefp.com or 843-285-7076 .

@2023 Voyage Financial Partners, 300 N Cedar Street, Suite A, Summerville, SC 29483

Securities & Advisory Services offered through CreativeOne Securities, LLC Member FINRA/SIPC & an Investment Advisor. Voyage Financial Partners & CreativeOne Securities, LLC are not affiliated.

Romance Scams

Tue, 17 Jan 2023 15:32:31 GMT

Romance Scams

by Tim Hudson

The Hook

The following story is hypothetical. There once was a lady who was strong and intelligent, who had recently lost the love of her life. Let’s call her Jane. They had been married for many years and did almost everything together. Although Jane missed him every day, she was learning to chart her new course without him. Out of the blue, she received a friend request on social media from someone that she didn’t know who lived in another state. In a weird way he had a lot of the same physical attributes as her late husband; not identical, but close enough. Replacing her husband was not something that interested her. Jane was just looking for some companionship, someone to talk with, someone to help with the lonely days. It all started innocently enough, messaging back and forth throughout the day. She felt an instant connection. His compliments were so nice after so long. The messaging soon turned to phone calls and texts, and she felt like this was really going somewhere. He really seemed to care. He asked Jane about her family, personal information, finances. In fact, all he wanted to do was talk about her, not himself. It was refreshing to have someone so interested. Jane felt giddy about the new opportunity, so she overlooked the growing number of red flags. He asked her not to tell her friends. (After all, he said, they wouldn’t understand what the two of them had.) He mentioned he was engaged in many projects at work and traveled frequently. He also would never do any type of video call with her because between work, his kids, and his lack of technology skills he didn’t have time -- at least that is what he said. To make it up to her he would come visit soon.

The Ask

Then out of the blue he had a medical issue at work, and his child had been in the hospital. He told Jane a heart-wrenching story that any person with a heart would believe. She felt torn. It was just a little money at first, a few thousand dollars. He promised he would pay her right back. In fact, to help her he had a special account set up so to make it as easy as possible for her. Jane sent the money to him, glad to help her new friend. He thanked her and promised to pay her back as soon as possible. A few days passed, and unfortunately, this medical emergency that he found himself in got worse and worse. He called, heartsick that he may lose his child, unless they did a major procedure that would cost tens of thousands of dollars. With a plea that brought tears to Jane’s eyes, he asked if he could borrow a large amount of money. He knew it was asking a lot, but he was out of options. She decided to send the money. It would hurt her retirement a little bit and Jane would have to cut back some, but she was helping the person that professed his undying love for her. It was a chance worth taking.

This Happens Every Day

Too many times scenarios like this happen every day to widows and widowers and many other people who are scammed out of their money by a supposed lover they recently met online. In fact it has a name: “Romance Scam”. In 2021 the FTC reported losses of 547 million dollars to these types of scammers, but many more have probably gone unreported. ¹ Sadly, those in retirement age who’ve lost a spouse are often targeted because of their access to cash and their loneliness. There are many ways this scam starts, but it usually begins with a friend request or an offer to follow you on a social media platform or dating site from someone who lives in the US but many states away. These scammers will steal another person’s social media platform, pictures, and names, then pretend to be someone that they are not. Once you’ve accepted their request, the scam begins.

Protecting Yourself and Others

What can you do to protect yourself or a friend who you think is going through one of these scams? First, talk to your friends and family anytime that someone asks for money from you, especially if it’s someone that you recently met. Many of these scammers do not want you to communicate with friends and family about them because they will see the red flags the scammer is trying to pull over your eyes. Be very leery of anyone that tries to cut you off from your friends or family. Secondly, be careful what you share online. Social Media is a lot of fun, and it can be easy to post many personal tidbits that in the moment seem harmless. However, it can be used by a scammer to make you a target. Thirdly, go slowly with this new relationship. The scammers want you to fall in love fast and may even propose to you after a very short time. Be friendly but distant, open but cautious. Fourthly, ask a lot of questions about them. In fact, ask them the same questions they ask of you. Be specific. Remember they have fallen in “Love” with you, so it only makes sense you know more about them. Be very cautious telling people you recently met about any of your financial information. Ask for a specific picture of them doing something like pointing to their ear, or a picture with a date in the shot, or in front of a famous building, or their office. A scammer most likely will not be able to produce it and will come up with an excuse as to why they can’t. If that happens, ask for another one. Other red flags to consider: they won’t video chat with you, they make promises to meet you in person but always have an excuse, they seem almost too perfect, they want to isolate you from friend and family, their messages seem copied or pasted, and/or the grammar, spelling, or vocabulary are slightly off.

Never open a bank account for them or send compromising videos or pictures that could be used for blackmail against you. And never send money or cryptocurrency to someone you have never met.

If You Have (or Think You Have) Been Scammed

First and foremost, you are not dumb or stupid. Professional scammers preyed on you during a weak moment and won. Forgive yourself and seek emotional support from those you know and trust. Secondly, if you feel comfortable - tell your story. Silence allows for these scams to continue and get bigger. It may be difficult, but you may be the person that saves one of your friends or family members from having to go through this sort of thing. You can report suspicious profiles or messages to www.ReportFraud.ftc.gov . This may help slow down the scammers. Report all money lost. Call your bank and credit card companies and tell them about the fraudulent charges; they may be able to reverse the transaction(s). If you mailed money to them, you can contact USPS and ask to intercept the package (1-800-876-2455). It may be too late, but it is always worth the try. If you sent a wire, you can contact the wire company and see if the wire can reversed.

Money Gram – 1-800-926-9400

Western Union- 1-800-448-1492

Ria (Non- WalMart) 1-877-443-1399

Ria (Walmart to Walmart or Walmart to World) 1-855-355-2144

Change all passwords and usernames to any and all accounts they may have access to. Update all security software and run a fresh scan. If you feel like your identity was compromised you can go to www.identitytheft.gov . Monitor all credit cards, bank accounts, and any other financial institutions you may have, just to make sure to prevent fraudulent charges or transactions.

Resources and More Information

Below we have listed many articles that can help you if you would like to learn more about this topic. If you have any questions or need any assistance, please email us at helpinghand@voyagefp.com or call us at 843-285-7076 .

@2023 Voyage Financial Partners, 300 N Cedar Street, Suite A, Summerville, SC 29483

Securities & Advisory Services offered through CreativeOne Securities, LLC Member FINRA/SIPC & an Investment Advisor. Voyage Financial Partners & CreativeOne Securities, LLC are not affiliated.

¹ https://www.ftc.gov/news-events/data-visualizations/data-spotlight/2022/02/reports-romance-scams-hit-record-highs-2021