Tag Archives: Retirement

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Ready to start budgeting and tracking your money? See our article Budgeting Tips from Mint — and subscribe to our blog for more budgeting help.

Budgeting Calculators

We’ve also got some calculators that can help you figure out exact dollar amounts for your budget:

How Much do I Need for Emergencies? Saving enough money for emergencies is the first step in setting a budget. Don’t be caught by surprise. How much do you need in your emergency fund?

How Much Should I Save to Reach my Goal? Are you budgeting for a house, vacation or retirement? Quickly find out if you’re saving enough to reach your goals on schedule.

Value of Reducing or Foregoing Expenses. Small changes in your daily routine can add up to big budget savings. Find out how much.

How Much Does Inflation Impact my Standard of Living? How much will you need in 5, 10 or 30 years to maintain your standard of living?

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Financial Lessons Learned During the Pandemic

2020 has shaped all of us in some way or another financially. Whether it is being reminded of the importance of living within our means or saving for a rainy day, these positive financial habits and lessons are timeless and ones we can take into the new year. 

While everyone is on a very unique financial journey, we can still learn from each other. As we wrap up this year, it’s important to reflect on some of these positive financial habits and lessons and take the ones we need into 2021. Here are some of the top financial lessons:

Living Within Your Means

It’s been said for years, centuries even, that one should live within one’s means. Well, I think a lot of people were reminded of this financial principle given the year we’ve had. Living within your means is another way of saying don’t spend more than you earn. I would take it one step further to say, set up your financial budget so you pay yourself first. Then only spend what is leftover on all the fun or variable items.

Setting up your budget in the Mint app or updating your budget in Mint to reflect the changes in your income or expenses is a great activity to do before the year ends. Follow the 50/20/30 rule of thumb and ask yourself these questions:

  • Are you spending more than you earn?
  • Are there fixed bills you can reduce so you can save more for your financial goals? 
  • Can you reduce your variable spending and save that money instead?

The idea is to find a balance that allows you to pay for your fixed bills, save automatically every month and then only spend what is left over. If you don’t have the money, then you cannot use debt to buy something. This is a great way to get back in touch with reality and also appreciate your money more. 

Have a Cash Cushion

Having a cash cushion gives you peace of mind since you know that if anything unexpected comes up, which of course always happens in life, you have money that is easy to liquidate to pay for it versus paying it with debt or taking from long-term investments. Having an adequate cash cushion this year offered some people a huge sigh of relief when they lost their job or perhaps had reduced income for a few months. With a cash cushion or rainy day fund, they were still able to cover their bills with their savings.

Many people are making it their 2021 goal to build, replenish, or maintain their cash cushion.  Typically, you want a cash cushion of about 3- 6 months of your core expenses. Your cash cushion is usually held in a high-yield saving account that you can access immediately if needed. However, you want to think of it almost as out of sight out of mind so it’s really there for bigger emergencies or opportunities that come up.

Asset Allocation 

Having the right asset allocation and understanding your risk tolerance and timeframe of your investments is always important. With a lot of uncertainty and volatility in the stock market this year, more and more people are paying attention to their portfolio allocation and learning what that really means when it comes to risk and returns. Learning more about which investments you actually hold within your 401(k) or IRA is always important. I think the lesson this year reminded everybody that it’s your money and it’s up to you to know.

Even if you have an investment manager helping you, you still need to understand how your portfolio is allocated and what that means in terms of risk and what you can expect in portfolio volatility (ups and downs) versus the overall stock market. A lot of people watch the news and hear the stock market is going up or down, but fail to realize that may not be how your portfolio is actually performing. So get clear. Make sure that your portfolio matches your long term goal of retirement and risk tolerance and don’t make any irrational short term decisions with your long-term money based on the stock market volatility or what the news and media are showcasing.

Right Insurance Coverage

We have all been reminded of the importance of health this year. Our own health and the health of our loved ones should be a top priority. It’s also an extremely important part of financial success over time. It is said, insurance is the glue that can hold everything together in your financial life if something catastrophic happens. Insurances such as health, auto, home, disability, life, long-term care, business, etc. are really important but having the right insurance policy and coverage in place for each is the most important part.

Take time and review all the insurance coverage you have and make sure it is up to date and still accurate given your life circumstances and wishes. Sometimes you may have a life insurance policy in place for years but fail to realize there is now a better product in the marketplace with more coverage or better terms. With any insurance, it is wise to never cancel a policy before you a full review and new policy to replace it already in place. The last thing you want is to be uninsured. Make sure you also have an adequate estate plan whether it’s a trust or will that showcases your wishes very clearly. This way, you can communicate that with your trust/will executor’s, beneficiaries, family members, etc. so they are clear on everything as well. 

Financial lessons will always be there. Year after year, life throws us challenges and successes to remind us of what is most important. Take time, reflect, and get a game plan in place for 2021 that takes everything you have learned up until now into account. This will help you set the tone for an abundant and thriving new financial year. 

The post Financial Lessons Learned During the Pandemic appeared first on MintLife Blog.

Source: mint.intuit.com

How Long Does It Take to Refinance a House (+ 5 Ways to Speed Up the Process)

We’re all looking for ways to cut down on expenses — especially fixed expenses that lock us into a contracted bill month after month. One common way to spare your budget is to decrease your living expenses, including your house payment. Refinancing your loan could help cut down on your mortgage payments and could update your loan terms, saving you money. If you’re considering refinancing, you may ask, “how long does it take to refinance a house?”

Refinancing your home can be tedious but it could help your budget in the long run. Luckily, we’re here to help by sharing the typical refinancing process and detailing how to make it as efficient as possible.

How Long Does It Take to Refinance?

How Long Does It Take to Refinance?

Typically, refinancing a house takes 45 days, but it may vary depending on your financial situation and your lender vetting process. Preparing your financials early and picking the appropriate lender for your case are a few factors that could help the timeline of your updated mortgage loan. To speed up the refinancing application process, skip to our section below or keep reading to refinance your home in seven steps.

Steps to Refinance Your Home

Refinancing your mortgage has its positives and potential negatives. You could decrease your monthly mortgage payments, get a shorter loan period, or lock in a better interest rate. But you could also end up spending more on application fees or face prepayment penalties. Before speaking with a lender, research the refinancing process, requirements, and added costs that could deter your ideal result.

The 7-Step Home Refinancing Timeline

Step 1: Define Your Financial Goals

Start by asking yourself what you’d like to get out of a refinancing loan agreement. Do you want to shorten your loan term? Do you want to secure an interest rate lower than your current rate? Or, do you want both? Determine your ideal end result, verify your investment choice, and seek a lender that supports your goals.

Step 2: Compare Lenders (and Reviews)

Ask around or search online to find the right lender for you and your goals. Pick out a few professionals you’d be interested in working with and ask them their rates, terms, and requirements. To help narrow down your lender options, seek out reviews online or ask for referrals in your network to ensure you pick the right choice.

Step 3: Double-Check for Additional Fees or Costs

Refinancing a loan can rack up a bill you may not be aware of until after you start the loan process. Attorney, application, inspection, appraisal, and title searches are a few refinancing tasks that you could be charged for. To budget for these expenses, save a bit extra from each paycheck or assess your current savings account using our app. If you have enough saved, start inquiring about this loan. If you don’t, put extra cash into savings each month until you have enough to cover the extra charges.

Mortgage Refinancing Documents

Step 4: Apply for Your Best Loan Estimate

Once you’ve found the right loan for your financial goals, the next step is to fill out your application.. To submit your application, you may have to provide proof of income, assets, debts, and other forms that complete your financial portfolio. These documents may be helpful in the application process:

  • Proof of income: W2 earnings statements, 1099 DIV income statements, Federal tax returns for the last two years, bank statements for the last few months, recent paycheck stubs.
  • Credit information: your credit score and your credit reports from the last three years will be pulled for you, upon your approval.
  • Proof of assets: reports from your checking, savings, retirement, and other investment accounts.
  • Proof or insurance: providing evidence of your homeowners and title insurance.
  • Debts statements: statements of any debt accounts open — student loans, credit cards, current home loan, auto loans, etc.

Step 5: Start the Loan Process and Appraise Your Home

It’s now time to begin the loan process and appraise the value of your home. Once you’re approved for your loan, it’s time to get your home inspected, appraised, and conduct a title search. To ensure you’re on track with your timeline, prepare all your documents ahead of time. Skip to our section below for more ways to speed up this process.

Step 6: Wait for Underwriters to Cross-Reference

Now, the underwriters take it from here. Underwriters double-check your financial information to ensure everything is accurate before approving your loan. Your creditworthiness and debt-to-income ratio are generally the key factors underwriters will look at. Your property details, including when you bought your house and your home’s value, are a few other determining factors. This process may be the longest time constraint, taking a few days up to a few weeks.

Step 7: Close Your Loan to Lock in Your Interest Rate

Once your loan is approved and you’ve agreed upon your terms, it’s time to lock in your rate. This stage is commonly known to stretch your timeline as well. It can take your lawyer anywhere from one day to two months to settle your current loan and redeem your property. Keep in mind, this is typically where you pay the brunt of your fees whether you’re approved or denied. These fees may include closing costs and application fees.

Ways to Speed up the Application Process

credit score of 620 or higher, it may be the right time to check in on your score. Use our app to see your credit score, your credit history, and helpful tips to boost your ranking.

  • Avoid taking on more debt: Your credit score is impacted by your debt. Maxing out your credit card could negatively impact your credit score and cost more in the long run. Focus on paying off debts and only spending your readily available money to free up more credit utilization.
  • Stay away from applying for new credit: Additionally, inquiring about new debt opportunities could drop your credit score up to eight points. Next time you’re offered a new credit card or a deal on a car loan, take a few days to analyze the potential credit changes that could impact your refinanced mortgage.
  • Do what you can to accommodate your appraiser and lender: During this process, you may run into a couple issues — such as needing different paperwork or extra signatures. While life can get busy, do your best to make your appraisers and lenders live’s easy. Doing so could speed up your process and earn you a better home loan in no time!
  • Refinancing your home takes time, but it can be well worth it in the long run. Getting a lower interest rate and a shorter term length could lessen your payments going towards interest. Use our app and our loan calculator to see what refinancing could do for your budget.

     

    The post How Long Does It Take to Refinance a House (+ 5 Ways to Speed Up the Process) appeared first on MintLife Blog.

    Source: mint.intuit.com

    How Long Does It Take To Buy A House?

    How long does it take to buy a house? The answer is: it depends. You can buy a house in a matter of weeks or it can take you anywhere from 4 to 6 months. The question is how ready are you? It can take a long time, and that’s just learning about various mortgage options or improving your credit score.

    So understanding the various factors involved in buying a house can give you an estimate of how long it will take you to buy the house

    Check out now: 5 Signs You Are Not Ready To Buy A House

    How long does it take to buy a house? A step-by-step guide.

    It can take a homebuyer a few weeks to several months to complete the home buying process. But when determining how long it will take you to buy a house, you first have to find out if you will be pre-approved for a mortgage. There is no sense of shopping for a house to then realize you can’t afford it.

    If you are interested in comparing the best mortgage rates through LendingTree click here. It’s completely free.

    I. How long does it take to get a pre-approved mortgage letter in order to buy a house?

    If you’re serious about buying a house, it’s important to get pre-approved for a mortgage. So when it’s time to make an offer, the seller will know you’re serious. If you don’t have one handy, the seller will likely move to the next buyer.

    Getting pre-approved for a mortgage in order to buy a house can take longer. That is because you have to make sure your financial situation is in shape. For example, your income-to-debt ratio, your down payment, and your credit score must be good. That’s exactly what a mortgage lender will look at.

    Even when these things are in order, shopping and comparing mortgage rates and fees can take several weeks.

    Let’s take a look on how long it will take you to get these things in shape before buying a house.

    Click here to compare mortgage rates through LendingTree. It’s completely FREE.

    A. How good is your credit score?

    A low credit score can make buying a house take longer, because it can take months to a year to improve a bad credit score.

    A conventional loan will usually require a 640+ credit score.

    In fact, your credit score is the number 1 item mortgage lenders look at to decide whether to offer you a mortgage. And if it is not where it’s supposed to be, you might get rejected.

    Luckily for you there are other ways to get a loan with much lower credit score: FHA loans.

    FHA loans only require a credit score of 580 with 3.5% down payment. You may get qualified with a 500 credit score, but you’ll have to come with a 10% down payment.

    So before you get into the fun part of shopping for a mortgage or visiting homes, it’s best to know what your credit score is and take steps to improve it.

    You can get a free credit score at Credit Sesame.

    B. Fix errors on your credit report.

    Fixing errors on your credit report in order to get pre-approved for a loan in order to buy a house can take 30 days.

    According to Transunion, “most investigations are completed within 2 weeks, but some may take up 30 days.”

    Again, we recommend you get a free credit report at Credit Sesame. A credit report will give you a detail analysis of your credit history, how much debt you owe, and how creditworthy you are, etc. If there are any errors or inaccuracies, fix them immediately so there’s no surprise when you’re actually applying for a mortgage.

    The best way to do that is by filing a Transunion dispute or Equifax dispute.

    C. Do you have a down payment for the house?

    How long it will take you to buy a house will also depend on whether or not you already have money saved up for a down payment.

    Unless you’re going to buy the house with outright cash, you’ll need a down payment. And saving for a down payment can take a long time. Depending on your income and expenses, saving for a down payment on a house can take years.

    Assuming, for example, you want to buy a house that will cost you $450,000, and you’re using a conventional loan to finance the house. With a 20% down payment, you will need to come up with $90,000.

    Let’s say again, because of other monthly expenses, you can only save $1500 a month for the down payment.

    You see how long it will take you to save for a down payment to buy the house? 5 years. And that doesn’t even take into account other upfront costs of buying a house, such as closing cost.

    While it’s possible to get a mortgage with a down payment as low as 3.5% of the home purchase price, it’s advisable to put at least 20% down. The reason is because you will avoid paying private mortgage insurance (PMI), which protects the lenders in case you default on your mortgage.

    Home buyers with a down payment below 20% are usually charged with PMI.

    Another reason for a larger down payment is that it reduces the cost of the mortgage, grows equity much faster, and saves you on interest over the life of the loan.

    As you can see, it can take you as much as 5 years from the time you’re thinking about buying the house to the time you’re actually ready to start the process.

    But once you have taken care the things above, buying a house can go a lot faster.

    II. How long does it take to find a real estate agent?

    Average time: 1 day to a month

    Once you have been pre-approved for a mortgage, the next step is to find an experienced real estate agent. Finding a good real estate agent can take a day to a month. Websites such as Zillow and Redfin list real estate agents you can use.

    III. Shopping for a home.

    Average time: a few weeks to a few months

    With the help of a real estate agent and your own due diligence, finding a home can can go faster or take longer depending on available homes, the season and your desired location.

    But experts say on average it can take a minimum of three weeks to a few months.

    IV. Making an offer, negotiation, and inspection.

    Average time: 1 to 10 days

    Once you have found the home of your dream, the next step is to make an offer. You and the seller can go back and forth negotiating the price.

    Once your offer has been accepted, you and the seller sign something called a purchase agreement. Then, the next step is to hire a professional to inspect the home for defects. Depending on your state, a home inspection must be completed within 10 days. And if the inspection finds some defects in the house, that could delay the process.

    V. How long does it take to close on a house?

    Average time: 30 to 45 days.

    Once the inspection is done, your lender will need to officially approve you for the loan. And depending on the lender, it can also affect how long it takes to buy a house. You may need to provide additional documents. But the lender will need to assess the home for its value. And depending on the program (whether it’s conventional loan or FHA loan) it can take anywhere from 30 to 45 days to close on a home.

    Bottom line

    When asking yourself this question: “how long does it take to buy a house?” The answer is : it depends. If you have your credit score, your down payment, your other finances under control, you can buy your house in two months or less. But if you have to save for a down payment, fix errors on your credit report, raise your credit score, the whole home buying process can take years.

    Click here to compare mortgage rates through LendingTree. It’s completely FREE

    Still wondering how long it takes to buy a house? Read the following articles:

    • 5 Signs You’re Not Ready To Buy A House
    • 10 First Time Home Buyer Mistakes To Avoid
    • 3 Signs You’re Not Ready to Refinance Your Mortgage
    • The Biggest Mistakes Millennials Make When Buying a House
    • 7 Signs You’re Ready To Buy A House

    Work with the Right Financial Advisor

    You can talk to a financial advisor who can review your finances and help you reach your goals (whether it is making more money, paying off debt, investing, buying a house, planning for retirement, saving, etc). So, find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

    The post How Long Does It Take To Buy A House? appeared first on GrowthRapidly.

    Source: growthrapidly.com

    7 Money Steps to Take Before 2021

    With the end of the year rapidly approaching, it’s a good time to take stock of your financial situation as you head into 2021. 2020 has been a strange year, and a difficult year for many people. With many people’s health and/or economic livelihoods affected by COVID-19, many people’s situation looks very different than it did back in January. As we head into a new year, here are a few things that you can do to improve your finances before the end of 2020.

    #1 Put at least $1000 into an emergency fund

    If you don’t have an emergency fund set up to handle unexpected expenses, that is a good first step to putting yourself on a solid financial footing. $1000 may not be enough to handle every possible thing that could go wrong, but it can be enough to handle your car breaking down or an unexpected home expense. If you don’t have at least a minimal emergency fund in place, make a plan for how you can start one before the end of the year.

    #2 Fully fund your retirement accounts

    401k, IRAs, and other retirement accounts have an annual contribution limit that caps the amount that you’re able to contribute each year. Before the end of the year, set aside some time to go through each of your accounts that have an annual contribution limit. Decide for which of those accounts it makes sense to fund before the end of the year.

    #3 Consider donating to charity

    With the increased standard deduction available in recent tax years, not as many people itemize their deductions. But if you do itemize your deductions, then remember that your charitable contribution may be tax-deductible. If you make that charitable contribution before the end of the year, you may be able to deduct it in this tax year — otherwise, you’ll have to wait an entire year before you’re able to deduct it.

    READ MORE: 5 Best Credit Cards When You Make Charitable Donations

    If you’ve already made charitable contributions in 2020, make sure that you have them documented and ready to include on your tax return.

    #4 Make sure you have a financial security plan in place

    Still, using the same username and password on every internet site? It may be time to get a financial security plan in place. With data breaches always a possibility now’s as good a time as any to take some steps to minimize your risk in case of a data breach or a hacker accessing your financial information. One thing that you can do before the end of the year is to set up a password manager to put some variety into your passwords. Another thing is to set up two-factor authentication (2FA) on your important financial accounts.

    #5 Review your credit report

    Each year you are entitled to a free three-bureau credit report once a year from annualcreditreport.com, and the end of the year can be a good time to do that. If you already have a Mint account, you have access to your credit score at any time, but reviewing your actual credit report can make a big difference to your credit report. Between 10 and 21 percent of people have errors on their credit report, and clearing up incorrect or inaccurate information can raise your credit score.

    #6 Use up any money in your FSA

    Flexible spending accounts can be a great way to save money on health expenses. An FSA is typically set up through your employer and allows you to make pre-tax contributions. Any money that you contribute to your FSA is not subject to tax, and you can use that money to get reimbursed for many different types of health expenses. The only downside is that most FSA plans are use-it or lose-it plans. So any money that is left in the FSA at the end of the year is forfeited. Check the details of your plan, and make sure that you use all the money in your FSA before the end of the year.

    #7 Set your financial goals for 2021

    Finally, the end of the year can be a great time to set up your financial goals for 2021. You don’t have to wait until January to start up a new resolution. Meet and talk with your spouse, family, or trusted friends and advisors. Decide where you want to be in one year, in five years and beyond, and start taking the steps to get yourself there.

    The post 7 Money Steps to Take Before 2021 appeared first on MintLife Blog.

    Source: mint.intuit.com