All-inclusive vacations can conjure images of food under heat lamps, too many poolside piña coladas, and being trapped on resort grounds. But sun-soaked packages are not the only type of all-inclusives.

Sure, sprawling mega-resorts exist — and their numbers are growing. All-Inclusive by Marriott Bonvoy has spent the last couple of years building a portfolio of nearly three dozen all-inclusive hotels worldwide, mostly in Mexico and the Caribbean.

One of the most highly anticipated is the Marriott Cancun, reopening in early 2024 to include some of the typical all-inclusive amenities: a sprawling property of 450 rooms, a lazy river, waterslides and more.

But guests looking for a more localized and unique experience can still find that type of vacation — with the price of food and activities included.

Consider a different type of all-inclusive travel in 2024

Some all-inclusives are entirely antithetical to stereotypical resort experiences. Wellness and activity take precedence over all-you-can-eat meals. They aren’t necessarily in sunny locales. Guest counts are limited, with just a handful of beds.

Vista Verde Guest Ranch in Clark, Colorado, is among the properties that check all those boxes. At the all-inclusive dude ranch, summer outdoor activities include fly fishing and paddle boarding. Winter options include snowshoeing, ice fishing, skiing and sleigh rides. There are only 12 cabins and three lodge rooms.

Many all-inclusives in this genre, such as the Arctic Watch Wilderness Lodge, may hardly be considered relaxing at all. With 16 cabins located just under 500 miles north of the Arctic Circle, vacationers are encouraged to partake in activities like riding fat tire bikes over the ice. If the ice has already melted, you can sea kayak instead. With no electricity at night and no in-cabin showers (they’re only in the main complex), it’s not glamorous. But it’s still expensive.

Beware the price tag

The cheapest Arctic Watch offering costs $17,500 Canadian (about $13,000) for nine nights, amounting to about $1,400 per night. At Vista Verde Guest Ranch, three-night stays start at $2,695 during the off-season or about $900 per night (though per-night costs decrease the longer you stay).

But not every all-inclusive worth visiting is for travelers with big budgets.

At Minnesota’s family-oriented Fair Hills Resort, cabins are modest and the food resembles what you ate at summer camp. Meals and activities — such as golf lessons, pickleball, and s’mores — are included in most packages. Rates can run just over $200 per adult, per night, and $121 per kid, per night, depending on your stay length.

How to book a better all-inclusive

According to a survey published in April 2022 that was commissioned by Wyndham Hotels & Resorts, which has a robust portfolio of all-inclusives, 77% of travelers believe that an all-inclusive vacation is the least stressful way to travel.

If you’re considering an all-inclusive for your next vacation, here are some tips to consider:

• Think boutique, not blockbuster: Skipping the sprawling resorts in favor of intimate properties can bring more personalized service. It might also better connect you with the destination and its people rather than the hundreds of other vacationers.
• Consider more than just beach locales: Whether it’s the Arctic tundra, a Minnesota summer camp or Colorado dude ranch, some of the most authentic experiences occur at all-inclusives that are far from the beach.

“We are stewards of the western ranch lifestyle, and we enjoy bringing folks into our world,” says Ben Martin, general manager of Colorado’s Vista Verde Guest Ranch.

You might even consider a trip that doesn’t stay in one place. Companies like SpiceRoads Cycling and Backroads offer all-inclusive, multiday cycling tours where you get a guide and bike support on top of meals and nightly lodging.

• Prioritize points: If you do opt for an all-inclusive stay at one of the major hotel chains, take advantage of the opportunity to book properties on points, which can often be earned through credit card spending.
• Embrace shoulder season: Shoulder season, which is the time between tourist season and the off-season, can provide a healthy mix of lower rates and fewer crowds, yet decreased risk of bad weather or businesses that have closed for the off-season.
• Understand what’s truly included: You might never touch your wallet at some all-inclusives. Others charge for add-ons such as snorkel gear or alcohol. A few even tack on resort fees.

Why all-inclusives make sense for travelers

Vista Verde’s Martin says his all-inclusive model avoids making vacationers feel nickel and dimed throughout the stay.

“If a guest is frequently reaching for their wallet, they are constantly being reminded that their stay is transactional,” he says. “It changes the dynamic of our relationship with them.”

And if you can score a deal — such as a stay booked on points or during shoulder season — an all-inclusive can leave a far bigger mark in your memory than your bank account.

This article was written by NerdWallet and was originally published by The Associated Press.

The article How to Book a Unique All-Inclusive Vacation That’s Not Terrible originally appeared on NerdWallet.

The investing information provided on this page is for educational purposes only. NerdWallet, Inc. does not offer advisory or brokerage services, nor does it recommend or advise investors to buy or sell particular stocks, securities or other investments.

Only one-third of men correctly estimated how long a 60-year-old man in the U.S. could expect to live, according to a 2022 TIAA Institute survey. And fewer than half of women got it right for a 60-year-old woman.

Advisers call this — understanding how long you’ll live in your retirement years — longevity literacy. It’s a crucial part of your retirement strategy, and it’s important that you and your financial professional are on the same page. You should be talking about things like what your planner is using as your life expectancy, how you’ll cover future health care costs and whether you need to account for any spending related to aging parents.

Getting this right means your money will last for as long as you do. Here are the questions to ask your adviser.

1. What are you using as my life expectancy?

No one can know when they’re going to die, but your health and family history can help your planner make a good guess. How long did your parents live, or your grandparents? Do you have any health conditions?

Planners often work with software that can model what will happen to your finances if you die at different ages, based on the assumptions you’re making. You can explore various scenarios together and decide what makes the most sense.

“If you’ve got longevity in your family, let’s boost it up to [age] 97 or even 100,” says Timothy Knotts, a CFP in Red Bank, New Jersey. “We want to make sure we don’t have this thing that keeps you up at night, which is, ‘Am I going to run out of money?’”

2. What should I be doing about long-term care?

The big wild card in your financial plan is whether (and how long) you’ll need long-term care. There’s a reasonable chance you’ll need some kind of support, so talk to your planner about the best way to prepare.

You may want to plan to purchase long-term care insurance at some point, or a hybrid policy that combines permanent life insurance with a long-term care rider. Or it may be better to self-insure and plan to use savings for long-term care needs if insurance is too expensive.

“It’s something that unfortunately many of us aren’t good at — the risk and uncertainty thing,” says Paul Yakoboski, a senior economist with the TIAA Institute. “This is where an adviser could be extremely valuable — to help us understand likelihoods and scenarios and the costs attached to them.”

3. How should I prepare to pay for health care needs?

You may have seen Fidelity’s statistic that a 65-year-old couple today may need $315,000 to pay for health care expenses in retirement. It’s a daunting figure. But making the right health care decisions once you’re eligible for Medicare can help.

“I think if people have Medicare and a Medicare Supplement, I’ve actually found they have a pretty good chunk of their health care paid for,” says Clark Randall, a CFP in Dallas.

This is because Medicare Supplement Insurance, otherwise known as Medigap, can pay for most out-of-pocket costs associated with your Medicare plan. As long as you can pay the premiums, many of your costs may be covered if you have a big health event.

“We also build in some percentage for out-of-pocket expenses,” Knotts says.

4. Should we include any planning for my parents?

If there are older adults in your life who may need your support later, make sure your adviser knows this and builds it into your retirement plan to the extent that’s possible. Do you anticipate bringing them to live with you or potentially moving in with them? Do you expect an inheritance, or do you expect to have to help pay their bills?

“I will ask, ‘Do your parents have enough money to support themselves in retirement?’” says Catherine Valega, a CFP in Winchester, Massachusetts. Clients may be doing everything right, she says, but it doesn’t mean their parents have done everything right.

Considering these questions may facilitate a conversation with your loved ones about the future, which can be helpful for everyone. If they’re young enough, you can also encourage your parents to look into long-term care insurance for themselves.

This article was written by NerdWallet and was originally published by The Associated Press. 

The article The 4 Longevity Questions You Should Ask Your Financial Planner originally appeared on NerdWallet.

Valentine’s Day might put you in the mood to look for love online. Unfortunately, criminals are also on the hunt, but for victims, not romance.

“Meeting people online has opened the door to romance fraud,” says Kim Casci-Palangio, program director of the peer support program at the nonprofit Cybercrime Support Network in Ann Arbor, Michigan. “You feel you can trust them,” she says, adding that cybercriminals often cultivate relationships for months before asking for money.

Reports to the Federal Trade Commission show consumers lost $1.3 billion in 2022 to romance scams. While romance scams can happen to anybody, here are some strategies experts suggest to reduce your risk of falling for one:

Beware of online relationships that move fast

People are often eager to move relationships forward quickly, especially around official holidays, says Eva Velasquez, president and CEO of the Identity Theft Resource Center, a nonprofit organization that provides advice and assistance related to identity theft. She suggests going slowly instead.

Scam artists, Velasquez explains, tend to shower their targets with affection, proclaiming their love early. Then, the victim feels compelled to send money when the scam artist says they need it. “They make up some excuse like an accident,” she explains. If their target doesn’t send it to them, they move on to the next victim.

Watch for common red flags

Another sign of romance fraud is if the person you are interacting with asks you to communicate off of the dating app, such as by using WhatsApp or email, says Ayleen Charlotte, whose story of being tricked by a romance scam was featured in the Netflix show “The Tinder Swindler.” Charlotte now works with BioCatch, a fraud prevention firm, as a scam advisor and banking customer advocate.

“They want you in a more personal environment to get to you,” Charlotte says, where they can interact with you on their own terms without any limits imposed by dating apps.

Casci-Palangio says another sign that something is amiss is if the person you are communicating with declines to have video calls with you or meet in person. They might cite reasons such as living overseas, serving in the military or working on an offshore oil rig.

“They may not be who they say they are,” Casci-Palangio says. They might also be using canned scripts that they send to multiple people; using terms like “honey” instead of your name is a sign you could be communicating with a scammer.

Do your own research

If you start to wonder about the person you are communicating with online, it’s time to go into investigative mode. Casci-Palangio suggests starting with a reverse image search of their profile photos. You can upload any photo to images.google.com to generate results. You might discover the images actually belong to someone else or are used across multiple sites with different names and identities.

“But they could also be using a newly created image. Having no online footprint is also a red flag,” she adds.

Melanie McGovern, national spokesperson for the Better Business Bureau, a nonprofit that promotes marketplace trust, suggests taking notes on your interactions so you can notice any inconsistencies. If your love interest mentions a high school they attended, then look it up and confirm whatever other facts you can.

“Make sure you’re asking all kinds of specific questions,” McGovern says, especially if they share a sad story about a sick relative or other compelling tale. Then, go back and ask the same questions a week later. “If they can’t remember details, you should be skeptical,” she says.

Avoid exchanging money

One common scenario involves the scam artist encouraging you to send money for an investment or asking you to accept a large deposit, which you then forward to another account. But then, the first check doesn’t clear and your own money vanishes, warns Seth Ruden, BioCatch’s director of global advisory.

“Don’t take funds from people you’ve never met, and don’t offer to circulate funds for others,” Ruden says. “If you authorize a money transfer, you are probably responsible for it,” he adds, which means you might never see your money again.

Let go of shame and report the fraud

“A lot of people feel stupid for falling into any type of scam, and that’s the taboo I want to take off. You are not stupid. This is what a fraudster does. This is their job,” Charlotte says.

To help victims feel less alone, the Cybercrime Support Network organizes groups for them to meet weekly to help process what they experienced and find emotional support. “Usually they haven’t told anyone yet because they’re embarrassed,” Casci-Palangio says.

People who have experienced romance scams can also get support and help others by reporting to their bank’s fraud department, as well as the FTC, a state’s attorney general’s office, the FBI, a local police station, the Better Business Bureau’s Scam Tracker and the Identity Theft Resource Center, among others.

Charlotte notes that “scams can happen to any of us. The right scam just has to find the right person at the right time.”

This article was written by NerdWallet and was originally published by The Associated Press.

The article Romance Scammers: They Call You Honey, but Don’t Send Them Money originally appeared on NerdWallet.

If you’ll be in college next year, don’t expect financial aid offers anytime soon. Colleges won’t begin receiving processed FAFSAs — Free Applications for Federal Student Aid — until mid-March, the U.S. Education Department said on Tuesday.

“We will email students when their information has been shared with their schools and when they can access official aid calculations on their StudentAid.gov account,” U.S. Department of Education Under Secretary James Kvaal said in a press call after the announcement.

Once colleges receive processed FAFSAs, they can start building financial aid packages, which may include loan eligibility, grants, scholarships and estimated cost of attendance. That process takes another few weeks. The earliest students could get financial aid offers is the first week of April. Colleges will likely rethink the typical May 1 decision date to allow students and families enough time to consider their aid packages, says Karen McCarthy, vice president of public policy and federal relations at the National Association of Student Financial Aid Administrators.

“It’s reasonable to think that many more states and institutions will be having those conversations about their deadlines, how far they can push those and still be able to get all their work done,” McCarthy says. “It really affects all of their timelines leading up to the beginning of the next school year.”

Biggest makeover in decades

The mid-March processing delay is the latest in a long string of missteps for the new 2024-25 financial aid form, which has undergone its biggest makeover since the 1980s. The FAFSA usually launches on Oct. 1 for the following academic year; this year, it “soft launched” three months late, on Dec. 30.

FAFSA users faced myriad glitches during the soft launch when the form was available for as little as 30 minutes per day. The online form is now available 24/7, and most technical issues have been resolved. However, some students — like those with undocumented parents — remain unable to complete the form.

In late January, after the form had already been live for nearly a month, the Education Department acknowledged a major math error that would have left $1.8 billion worth of aid on the table.

Until the Education Department’s announcement on Tuesday, colleges were still working under the assumption that they would begin receiving processed FAFSAs by the end of January, McCarthy says.

“Schools had already restructured their timelines in terms of awarding and when things would happen with regards to aid offers, and so now they’ve thrown that all into disarray again,” McCarthy says.

On Jan. 24, a group of lawmakers led by two Republicans — Sen. Bill Cassidy of Louisiana and Rep. Virginia Foxx of North Carolina — sent a letter to the Government Accountability Office calling for an investigation of the Education Department’s rocky FAFSA rollout.

“The Department of Education had three years to prepare the rollout of the updated FAFSA. Their inability to do their job has real consequences for students and families,” Sen. Cassidy said in a statement Tuesday. “These unacceptable delays from the Biden administration creates the real likelihood that many students will forgo college because they cannot choose a school without knowing their eligibility for student aid.”

Students and parents: Here’s what you can do

Despite the FAFSA delay and confusion, it’s still important to fill out the form. Otherwise, students won’t be able to qualify for federal student loans, grants, work-study and some scholarships. There’s no income limit to qualify for aid, and you might get more than you expect.

Submit the FAFSA as soon as possible. Even with the major processing delay, your FAFSA will record a time stamp when you submit it. Since some types of financial aid have priority deadlines or are first-come, first-serve, submit the form soon to qualify for the most aid.

Remember the paper FAFSA is an option. If your parents are undocumented and can’t complete their portion of the FAFSA, you may want to wait a few weeks until the online process opens. But if you have any upcoming priority financial aid deadlines, you can complete the PDF version of the FAFSA. It’s available in English and Spanish on StudentAid.gov. You’ll need to mail the completed paper form to the Federal Student Aid office.

Confirm your financial aid deadlines. If you’re a prospective student, reach out to your potential schools to see if they’ve moved their FAFSA and college decision deadlines. If you’re a current student, confirm the financial aid timeline at your school. All students should check financial aid deadlines for their state and any scholarships to which they’re applying.

Ask for assistance. Free FAFSA help is available. Reach out to your high school’s college counselor or the financial aid offices at your school (or potential schools), search for college access nonprofits in your community or call the Federal Student Aid office at 800-4-FED-AID.

Here’s the bright spot: the new FAFSA is easier and quicker to complete for many students. Some will need to answer only 18 questions, down from 103 possible questions in previous years. With a new financial aid eligibility formula, at least 1.5 million students from low-income backgrounds are expected to qualify for the maximum Pell Grant award — $7,395 per year.

The article More FAFSA Delays Likely to Slow Aid and College Decisions originally appeared on NerdWallet.

In the first Federal Reserve meeting of the year, the central bank paused rates for the fourth time in a row Wednesday. More than half a year since the last rate hike, a hoped-for cut could be on the way — but don’t count on it just yet.

The stock market sank as hopes were dashed for a rate cut in March, but it began to recover as Powell softened some of the sentiment expressed in the Fed’s announcement.

“We have six months of good inflation data,” Powell said. “The question really is: that six months of good inflation data — is it sending us a true signal that we are in fact on a path — a sustainable path — down to 2% inflation? That’s the question. And the answer will come from some more data.”

A decline in the federal funds rate would be a welcome change for consumers, who have seen interest rates spike for mortgages, credit cards and more since the Federal Reserve began hiking rates in March 2022 to combat rising inflation.

But we’ve come a long way in two years. Inflation has continued to slow, but not quite enough for the Fed, and that slowdown has been primarily in goods, not services. Wednesday’s announcement indicated that the Fed is still waiting to see a continued downward trend.

Last week’s Personal Consumption Expenditure (PCE) price index — the inflation proxy the Fed values most — showed core inflation, minus volatile food and energy prices, grew 2.9% over the last 12 months. By comparison, the PCE released by the Bureau of Economic Analysis in January 2023 showed core PCE grew 4.7% from the 12 prior months.

Based on current data Powell said the Fed doesn’t believe the U.S. has reached a soft landing, that is, inflation coming down sufficiently following financial tightening without sliding into a recession. “We’re not declaring victory at this point. We think we have a ways to go,” said Powell.

But it’s unlikely the Fed would wait to get the inflation rate down to 2% — its target goal — before it begins making rate cuts.

Taking its cue from the Fed’s announcement, the futures market’s CME FedWatch Tool is mixed on the Fed’s next move in March. While the tool pegged odds at about even for a March rate cut before Wednesday, estimates were shifting to a more pessimistic outlook after Powell’s remarks.

However, there are multiple federal data reports for the Fed to factor into its plans before it makes any decisions, including two more jobs reports and multiple additional inflation reports.

The article When Will the Fed Cut Rates? More Data Needed, Powell Says originally appeared on NerdWallet.

With the federal minimum wage mired at $7.25 an hour since 2009, many cities and states have been taking it upon themselves to set the bar higher. And sometimes, higher again.

In fact, minimum wage earners in 22 states and 38 cities and counties got a pay bump on Jan. 1.

Today, the highest minimum wages, by state and Washington, D.C., are in D.C. ($17), Washington ($16.28), California ($16), Connecticut ($15.69) and New Jersey ($15.13). In addition, New York, Massachusetts and Maryland all have minimum wages of $15.

On the more local level, 58 cities and counties have minimum wages set higher than their state’s wage. All of the top 10 are in the West, and the top three cities are close neighbors:

1. Tukwila, Washington: $20.29.
2. Seattle: $19.97.
3. SeaTac, Washington: $19.71.
4. West Hollywood, California: $19.08.
5. Mountain View, California: $18.75.
6. Emeryville, California: $18.67.
7. Sunnyvale, California: $18.55.
8. Denver: $18.29.
9. San Francisco: $18.07.
10. El Cerrito, California: $17.92.

This year’s state and local minimum wage increases are estimated to impact 9.9 million workers, according to the Economic Policy Institute, which tracks minimum wage changes.

Of those 22 state increases on Jan. 1, 14 were due to automatic inflation adjustments. Two other places have automatic adjustments on July 1 each year: Washington, D.C., and Oregon. But the state with the highest increase as of Jan. 1 was Hawaii: a $2 increase to $14, representing a 28% bump.

Who is most likely to earn minimum wage?

A 2023 Bureau of Labor Statistics report highlights the demographic characteristics of workers making minimum wage or less in 2022. These workers are most often:

• Young: 45% are under the age of 25.
• Women: 2% of women compared to 1% of men.
• Black: 2% are Black compared to 1% among all other race and ethnicity groups.
• Part-time workers: 3% work fewer than 35 hours per week compared to 1% of full-time workers.
• In the leisure and hospitality industry: 3 in 5 of all workers at or below the federal minimum wage level work in restaurants, bars and other food services.
• Students, those with some college experience or associate degree holders: 2% have some college experience or hold a two-year degree compared to 1% of workers without a high school diploma or those with a bachelor’s degree and higher.

Since 2009, the federal minimum wage has stayed stuck at $7.25 per hour. It’s the longest stretch without a wage increase since the U.S. first instituted a minimum wage in 1938, federal data shows.

It’s worth noting, however, that while 20 states have the minimum wage set to the federal minimum level, that doesn’t mean the majority of hourly paid workers aren’t earning more. In Louisiana and Mississippi, for example, 3% of hourly paid workers are earning $7.25 per hour. And in Alabama and Utah, it’s just 1% of hourly paid workers.

Among all hourly workers in the U.S., 0.18% earn the federal minimum wage and 1.1% earn below the federal minimum as of 2022, according to the Bureau of Labor Statistics. Those who earn below the federal minimum of $7.25 are typically tipped workers who are required to be paid a federal minimum of a $2.13 cash wage in addition to tips.

Even though most hourly workers are making more than the federal minimum, it’s still not enough to keep up with inflation — especially the elevated inflation of recent years. According to the Bureau of Labor Statistics’ inflation calculator, $1 in 2023 has only 70% of the buying power as $1 in July 2009, when the federal minimum wage was last increased. So that means $7.25 per hour today was worth $5.11 per hour in 2009.

Legislative efforts to increase the federal minimum wage since 2009 have fallen flat. The latest proposal is the Raise the Wage Act proposed last year by Democrats in Congress. It would increase the federal minimum wage incrementally to reach $17 an hour by 2028. Every year thereafter, minimum wage adjustments would be tied to median wage growth.

The article These 10 Cities Have the Highest Minimum Wage in the U.S. originally appeared on NerdWallet.

For some, the new tax season might serve as a stressful reminder of past taxes that have yet to be filed and paid. Taxpayers owed over $120 billion in back taxes, penalties and interest in 2022, according to the IRS. And there soon may be more concrete reminders coming: The IRS resumed sending automated collection notices for unpaid taxes in 2024 after pausing them “due to the unprecedented effects of the COVID-19 pandemic” in February 2022.

If you’re one of the many taxpayers who owe tax debt this season, addressing the issue sooner rather than later can save you from penalties, interest and other more serious consequences. And you can get started even if you can’t afford to pay in full. Here’s what you can do to get back on track.

If you get a notice, read it

The longer you delay reading and responding to unpaid tax notices, the more serious your tax situation could become.

If you continue to ignore notices, the IRS may resort to severe measures, including tax liens, wage garnishment, asset seizure and passport restrictions. And if you owe state taxes, you could face additional collections and garnishments.

However, the IRS and state tax agencies will always try to contact you before escalating to more extreme measures. If you show the agency that you’re willing to pay — even if it’s not the full amount — you can avoid the worst outcomes.

Set up a payment plan

Most taxpayers can set up short- or long-term payment plans, including installment agreements, through the IRS website. To apply for one online, you must owe less than $50,000 in combined tax, penalties and interest for a long-term plan or less than $100,000 for a short-term plan. The agency waives setup fees for low-income taxpayers and has options for businesses, too.

Once you contact the IRS and set up a plan, the government will stop sending notices about your tax debt because collection has already been accomplished, Portera says.

If you have an existing payment plan, you can update it to account for this year’s taxes.

Contact a pro

Not everyone with overdue taxes needs a tax attorney. But if you’re dealing with tax authorities, owe large amounts of money or have a tax situation that you feel unable to handle on your own, Portera recommends enlisting the help of a licensed tax professional, such as a certified public accountant, enrolled agent or tax attorney.

When you don’t file your return, the IRS puts together a substitute return for you with a proposed assessment of what you owe. This tax return the IRS files for you is “almost always going to be not in your favor,” says Robert Persichitte, a CPA at Delagify Financial in Colorado who has experience working with clients in urgent tax situations.

According to Persichitte, some tax preparers will look at your substitute return for free and tell you if it needs to be amended. Sometimes, a licensed tax professional can negotiate with the IRS to reduce the amount you owe. In serious cases, they may help you apply for an offer in compromise, an agreement with the IRS that settles your tax liability at a lower amount.

Remember, though, that tax relief isn’t usually a quick fix — and promises of a dramatic cut to your tax debt may be a scam.

“If it sounds too good to be true, guess what? It usually is,” Portera says. The process for negotiating a reduced tax bill is complicated, he notes. If a tax relief company can’t deliver and fumbles communications, he adds, it could result in more interest and penalties for you, and no resolution.

For low-cost options, contact the Taxpayer Advocate Service or your local Low Income Taxpayer Clinic, which provides free or low-cost assistance for low-income taxpayers.

Don’t forget about current tax returns

When taking care of overdue taxes, don’t forget to file taxes for 2023.

Even if you have overdue penalties — or don’t have the funds to pay this year’s fees in full — stay compliant with the IRS by filing your returns annually. The agency is much more likely to waive your penalties or even agree to reduce your tax debt if you have a history of compliance.

Claire Tsosie, an assigning editor at NerdWallet, contributed reporting to this article.

This article was written by NerdWallet and was originally published by The Associated Press.

The article Tackle Overdue Taxes This Year originally appeared on NerdWallet.

A couple of years ago, I wrote a column about how to have a retirement worth saving for. It ended with a quote from personal finance educator Barbara O’Neill, who reflected on how the pandemic disrupted many retirees’ plans.

“It wasn’t just two years lost, it was two good years,” O’Neill said then. “You don’t know how many of those you have left.”

One of my younger colleagues objected to that sentiment, saying it was a jarring ending to an otherwise upbeat column. But my older co-workers got it. Those of us who currently have good health and energy don’t know how long those blessings will last. There’s no guarantee we’ll get to enjoy the retirements we have planned.

That lesson was driven home in July 2023, when a longtime colleague died at age 61. We’d had many talks over the years about the retirement he had envisioned. It’s heartbreaking that his dreams will never happen.

But his death was the push I needed to make my own decision. By the time you read this, I will have retired from my job at personal finance site NerdWallet.

Making the decision was surprisingly hard

When our financial planner told us we could afford to retire, my initial reaction wasn’t joy but bemusement.

I’ve been writing about retirement planning for three decades and saving for even longer, but it was always a goal in the distant, misty future. Making the decision felt like jumping off a cliff.

Would I be OK without the intellectual challenges, social interactions and sense of satisfaction I get from my job? Had I accomplished everything I wanted to in my career? And just how much would I miss that nice, steady paycheck and all the wonderful benefits NerdWallet provides, including massively subsidized health care?

Doing what a journalist does: Research

At this point, I have to acknowledge the huge privilege of even having a choice about when to retire. Almost half of retirees leave the workforce earlier than they planned, according to the Employee Benefit Research Institute. Some are laid off or forced out. Others have health issues or must care for loved ones who are sick or disabled. Many people keep working out of necessity: They have bills to pay and too little savings.

Knowing all that didn’t make the choice easy, however. So I did what I do best: copious research. I found it hugely helpful to read O’Neill’s book, “Flipping a Switch: Your Guide to Happiness and Financial Security in Later Life.” Another good read is “Independence Day: What I Learned About Retirement from Some Who’ve Done It and Some Who Never Will,” by Steve Lopez, my former Los Angeles Times colleague.

My husband and I had many, many discussions with our financial planner. We asked her to rerun our plan with different assumptions about what we’d spend, how we’d tap our funds, what the markets might do and what we’d earn with part-time work. This stress testing gave us confidence in our plan.

Our planner also connected us with an insurance agent who helped us figure out health coverage. My husband is old enough for Medicare, but I’m a few years shy of 65 and we have a daughter going to college in another state. I’m glad we have the option to buy health insurance through the Affordable Care Act exchanges. But continuing my employer’s group coverage for my daughter and myself through the Consolidated Omnibus Budget Reconciliation Act (COBRA) turned out to be the most cost-effective option for now.

Our financial plan worked and health care was solved, but emotionally I was still resisting. Ultimately, I realized why. I was looking at retirement solely as an ending.

Looking ahead, rather than back

With previous big life changes — buying a home, getting married, having a child, starting new jobs — excitement about the adventure to come quickly overcame concerns about what I was giving up. I needed to stop focusing on what I was retiring from and start contemplating what I was retiring to.

Today, I’m seeing retirement for what it is: the beginning of an interesting new chapter in our lives. The time I once spent building a career will be invested in travel, volunteering, and deepening relationships with friends and family.

I’m proud of what I’ve accomplished. I’ve won awards, written five books, contributed to the growth of a company (NerdWallet) and its award-winning podcast (“Smart Money”). Most importantly, I’ve helped people solve their money problems. I’ll continue with that last part, but I’m also looking forward to the rest of what comes next.

This article was written by NerdWallet and was originally published by The Associated Press.

The article Retiring Wasn’t Easy — Even After Years of Writing About It originally appeared on NerdWallet.

Last year was tough for potential home buyers: Prices and mortgage rates were high, while the number of homes available was low. But even if rates inch down and inventory climbs — trends many experts expect in 2024 — some nonhomeowners will be content to sit this one out. That’s because renting a home isn’t just a consolation prize, something you do only if you can’t buy. For many, it’s a deliberate choice.

Well over one-third (37%) of renters plan on renting forever, according to NerdWallet’s 2024 Home Buyer Report. For many, it’s a lifestyle choice: Three-quarters of Americans who rent their homes say renting suits their life better than owning right now.

Meanwhile, a smaller share has resigned themselves to renting after a discouraging run as a potential buyer: 1 in 20 Americans who began 2023 with plans to purchase canceled those plans because they changed their mind about buying a home, now or ever, according to the survey.

The decision to rent or buy is complex and goes beyond the financial aspects. Here are four considerations that may make renting not only acceptable but the right choice.

1. Upfront costs of homebuying are substantial

More than half (56%) of renters say they don’t think they’ll ever be able to afford homeownership, according to the NerdWallet survey. Indeed, average mortgage payments are 37% higher than the average rent in multifamily units, according to a recent analysis from CBRE Research, a commercial real estate services and investment firm.

And these monthly ownership costs are far from the only ones tipping the scales. Even in markets where rents and house payments are comparable, buying a house requires upfront costs that far exceed a security deposit. These upfront homebuying costs, including the down payment and closing costs, can easily run into the tens of thousands of dollars.

Saving for these costs can take years of sacrifice, setting aside money that could otherwise go toward retirement or other long-term financial goals — or fun stuff, such as travel. It boils down to what you value, and if your heart isn’t really in it, homeownership might not be worth those sacrifices for the time being.

2. You don’t want to feel tied down

Owning a home makes it more cumbersome to move when you receive a job offer or simply desire a change of scenery. If you’re uncertain of where you want to live long-term, it can be difficult (and costly) to commit to a mortgage. The 75% of renters who say renting suits their lifestyle better than owning would likely nod their heads to this.

There’s no hard-and-fast rule regarding the age at which you should “put down roots.” There’s really no rule at all. If you prefer the flexibility of shorter-term commitments or want to experience many locations before choosing a favorite, renting can give you that.

3. Homeownership requires more ongoing work

Generally, homeowners are advised to set aside 1% to 4% of their home’s value each year for ongoing maintenance costs. The maintenance and repairs of a rental home, on the other hand, are largely left up to the landlord. While the service quality may vary, it rarely comes at an additional cost to the renter. And this isn’t lost on those tenants: 55% of renters prefer renting to all of the expenses and effort of homeownership, according to the survey.

While DIY trends have grown significantly over the years — through popular culture on television and social media, and later through necessity during the early pandemic — not everyone wants to invest in the tools and time necessary to maintain their own home. And those homeowners who choose not to would otherwise have to do the work of hiring someone, another dreadful task.

4. You’re not convinced it’s a good investment

Well over half (59%) of renters don’t believe buying a home in the current market is a smart investment, according to the survey. Real estate investments, like most investments, don’t come with guaranteed returns. Even if you get a deal on a house and make improvements with the goal of selling it at a profit, things outside of your control (e.g., the economy, a pandemic, etc.) can have a significant impact on the outcome.

About one-third (34%) of renters are embarrassed to admit they rent instead of owning their home, but they don’t need to be. People who lease vehicles likely aren’t ashamed of their choice. Renting a home can be a perfectly logical decision, made after weighing the costs, benefits and how one option simply fits your life better.

The article Why Some Renters Won’t Buy Homes, Even as Mortgage Rates Fall originally appeared on NerdWallet.

About 41% of Original Medicare beneficiaries had Medicare Supplement Insurance, or Medigap, in 2021, according to a February 2023 report summarizing enrollment data from AHIP, a national health insurance trade association. For the other 59%, Medicare has some “gaps” that could be costly.

“There are many gaps in Medicare that a beneficiary has to pay if they don’t have a Medigap,” Kelli Jo Greiner, Minnesota State Health Insurance Assistance Program director, said in an email. “This can add up to be thousands of dollars per year.”

While it’s not mandatory, you might want to purchase a Medigap policy to fill some of the gaps in Medicare Part A and/or Part B. (Medigap doesn’t work with Medicare Advantage policies.)

Deductibles

Medicare Part A has a deductible of $1,632 in 2024, which you owe before Medicare starts to pay for inpatient hospital care.

“Just one hospital stay, you’re going to be paying that $1,632 deductible — so, really fast, your costs can add up,” says Joanne Giardini-Russell, CEO of Giardini Medicare, an independent insurance agency.

Most Medigap plans cover the Part A deductible. And plans with premiums below $136 per month could put you ahead based on that benefit alone.

(New Medicare members can’t buy Medigap plans that cover Part B’s relatively smaller deductible of $240 in 2024, so you’d still owe that amount out of pocket.)

Coinsurance and copays

After you’ve met your deductible, there are out-of-pocket costs for many Medicare services. For example, you pay a 20% coinsurance for most medically necessary outpatient services covered by Part B.

Medicare Part A copays kick in after your 60th day in the hospital. They start at $408 per day in 2024 and get more expensive for longer stays.

All Medigap policies include at least some coverage for Part A and Part B coinsurance and copays. If you use a lot of health care, that coverage could mean big out-of-pocket savings.

Out-of-pocket limits

Unlike many other kinds of insurance, Medicare Part A and Part B don’t have maximum out-of-pocket caps. There’s no limit on what you could owe as copays and coinsurance add up.

“Original Medicare without Medigap would be perilous because we need Medigap for the out-of-pocket limit,” Michael Dayoub, a certified financial planner in Savannah, Georgia, said in an email.

Buying a Medigap policy is one way to put a cap on your yearly costs. Paying more upfront for premiums could pay off by limiting your future out-of-pocket spending.

Is Medigap worth the cost?

You can expect to pay $100-$150 per month or more for the most popular Medigap plan, Plan G, when you sign up at age 65. And premiums can go up based on plan type, age, location and sometimes health status.

That’s a significant added expense — so is it worth it?

Giardini-Russell compares Medigap to car insurance, which you pay for each month, even though you hope not to need it. “It comes down a lot of times to the psychology and peace of mind,” she says. “Are you willing to pay $150 per month for peace of mind?”

“We tend to hear from beneficiaries that they are very satisfied with their policy,” Greiner said. Medigap is worth it if you can afford to pay the Medigap premiums along with your premiums for Medicare Part B and a Medicare Part D prescription drug plan, according to Greiner.

If Medigap isn’t affordable, you might want to look into programs that can help with Medicare costs, such as Medicare Savings Programs and Extra Help subsidies.

People who can’t afford Medigap premiums could also consider Medicare Advantage, according to Dayoub. Medicare Advantage plans are bundled alternatives to Original Medicare sold by private insurance companies. They have out-of-pocket limits, but there are trade-offs to consider, such as limited provider networks.

Enrollment time limits

The best and easiest time to buy a Medigap policy is right as you’re turning 65. Your six-month Medigap open enrollment period starts when you’re 65 and enrolled in Medicare Part B.

During this period, insurance companies can’t use medical underwriting to charge you more or deny coverage based on your health or medical history. After that, it can be more expensive or even impossible to get a Medigap policy.

So if you want to buy in for peace of mind, don’t miss your best chance. You can compare options on Medicare.gov, shop online or work with an agent or broker to find the best policy for you.

This article was written by NerdWallet and was originally published by The Associated Press.

The article Do I Really Need Supplemental Insurance With Medicare? originally appeared on NerdWallet.