Four Questions to Ask Before You Open Your Wallet

 
	Four Questions to Ask Before You Open Your Wallet Even if you have the best of intentions, it’s easy to overspend. According to a Gallup poll conducted June 9-15, 2014,* 58% of people who had shopped during the previous four weeks said they spent more at the store than they originally intended to. Even if you’re generally comfortable with how much you spend, you may occasionally suffer from a case of buyer’s remorse or have trouble postponing a purchase in favor of saving for a short- or long-term goal. Here are a few key questions to consider that might help you fine-tune your spending.
 

How will spending money now affect me later?

When you’re deciding whether to buy something, you usually focus on the features and benefits of what you’re getting, but do you think about what you’re potentially forgoing? When you factor this into your decision, what you’re weighing is known as the opportunity cost. For example, let’s say you’re trying to decide whether to buy a new car. If you buy the car, will you have to give up this year’s family vacation to Disney World? Considering the opportunity cost may help you evaluate both the direct and indirect costs of a purchase.

Some other questions to ask:

  • How will you feel about your purchase later? Tomorrow? Next month? Next year?
  • Will this purchase cause stress or strife at home? Couples often fight about money because they have conflicting money values. Will your spouse or partner object to your purchasing decision?
  • Are you setting a good financial example? Children learn from what they observe. What messages are you sending through your spending habits?

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Choosing a Retirement Community

Retirement Community

Perhaps you’ve seen ads for a new “over 55″ luxury condominium development in your town. Or another winter of shoveling has finally convinced you that it’s time to move to a warmer climate. You’re looking forward to life in a retirement community, but with so many options, how do you choose the right one?

 

Beginning the search

 

The first step is to think about where you want to live, how you want to spend your retirement years, and what type of home you can realistically afford. All retirement communities are designed with the needs of older adults in mind, but they provide different living arrangements, activities, and services.

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I just bought a vacation home. Do I need to purchase a specific type of insurance?

Vacation HomeInsuring a vacation home is different from insuring a primary residence. As a result, you’ll want to purchase insurance that is specifically geared to provide coverage for this type of property.

 

When insuring a vacation home, the type and cost of coverage will vary, depending upon the insurance company and the state in which your vacation home is located.

 

Most insurers offer at least some type of insurance that is specifically designed for second/vacation homes. Coverage under these types of policies can range from standard coverage that protects against certain named perils, to more comprehensive coverage that protects against all perils unless specifically excluded in a policy. Continue reading

Will my homeowners insurance policy cover hurricane damage?

HurricaneIt depends. While the types of coverage offered by standard homeowners insurance policies vary, windstorms are one of the basic perils that most standard homeowners insurance policies will cover. This means your policy should compensate you for loss/damage to your home that results from a hurricane or other windstorm (e.g., broken windows, torn roof, damage from fallen trees).

 

Keep in mind that if you live in an area of the country that is prone to hurricanes (e.g., the coastal region of Florida), an insurance company may exclude coverage for hurricane damage from a standard homeowners insurance policy. And even if an insurance company does provide coverage, homeowners insurance policies in states that are at a high risk for hurricanes often contain a separate, higher deductible for hurricane damage.

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