New Job Can Present Opportunity For More Benefits Than Just Salary

Ray’s Take: Google employees have access to free food, a bowling alley, bocce courts and a fleet of electric cars to drive during work hours. Campbell Soup Company has onsite childcare and kindergarten. Cisco Systems gives employees free acupuncture. L’Oreal employees get access to nap pods.

While most companies aren’t able to offer these fancy benefits and perks to their employees, there are many important legal and financial aspects to consider when offered a new job and asked to sign an employment contract. Contract negotiations can be difficult and stressful. Many times high-level executives use an experienced employment law attorney to assist them in reviewing these documents. You may not be looking for a job at that level yet, but the market is getting tighter shifting more negotiating strength to potential employees.

In addition to the usual salary and benefits, take time to understand your equity grant benefits. Some questions to ask are, “Is the grant tax-advantaged incentive stock options, non-qualified stock options, stock appreciation rights or restricted stock units?” “What is the vesting period for the equity grant?” “If stock options are granted, what is the exercise price?”

If going to a company where acquisitions could be possible, ask about a “Golden Parachute.” These are benefits guaranteed to you in the event you are fired as a result of a takeover of the company. If this happens, are you entitled to terminate employment and receive the golden parachute payment?

You will also want to consider certain liability protection coverage within the scope of your job. Does the company have Directors’ and Officers’ (“D&O”) insurance coverage?

One last thought as the jobs markets further tighten, there’s more to life than cash and benefits. You’ll be spending at least a third of your time working. Now may be the time to negotiate for quality of life. After all, this is not a dress rehearsal.

It’s always a good idea to get help from an experienced attorney when reviewing an employment contract.

Dana’s Take: For parents taking a break from work and recently-retired adults, it’s a tough call whether to re-enter the job market or not. Benefits can tip the scales toward work.

A non-employed spouse may return to work when a self-employed spouse needs family healthcare coverage. Consider part-time work that provides healthcare. A part-time Apple Store employee once told me how shocked he was to receive healthcare benefits. It’s rare but possible.

If a company contributes to retirement savings or matches employee savings, this could be incentive to get back in the saddle. For the recently-retired, re-entering the workforce could also mean delaying tapping into Social Security savings for a bigger paycheck later.

Whether it’s for the employee discounts or a safety cushion of savings, jumping back in the workplace can pay off now and later.

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Should You Lease or Own a Car?

Ray’s Take: According to the Lease Market Report by Edmunds.com, lease volume has doubled in the U.S. in the last five years and the automotive market is on the verge of a fundamental shift in consumer behavior about the value of owning a new vehicle – particularly when the purchase has to be financed.

Deciding whether to lease or buy a car is a personal decision that is usually based on how many miles you drive per year, your credit history and lifestyle.

Leasing is a good option for those who want a low monthly payment, prefer to have a new car every few years and want to avoid repair costs.

Keep in mind that you must have excellent credit to lease and when you do, a portion of the car’s depreciation and financing costs can be deducted on your taxes if you use the car for business purposes.

But leasing can be tricky. Ignoring the fine print can cost you dearly, like early termination penalties, excess wear fees and other hidden costs. Make sure you are clear on the financial commitment you are about to make by getting a detailed written estimate from the dealership with all fees, including monthly payments, down payment, title and registration and delivery charges. Add your insurance cost to that to see the big financial picture.

I recently suggested that a client go a year on Uber rather than buying or leasing. When we did the math at the end of the year, she was better off and loved not having to deal with parking! Transportation is changing. Buying and owning a car was a significant part of the American culture for a long time, but this may soon go the way of the landline.

On a recent family vacation to Chattanooga my son and I took an Uber to Rock City while Dana and our daughter used the car for a show in another city. All went well until I opened the Uber app to go back to the hotel. Nothing. No cars available – at any price. We got a taxi – and I still own a car – for now.

Dana’s Take: I know folks who have leased cars and have not enjoyed or repeated the experience. The additional charges for bumps and scratches were just too annoying and costly.

Searching for a gently used car is one money-smart option. My college friend and I have been looking at electric cars, so we were green with envy when a colleague scored a 2-year-old electric car with only 11,000 miles for about a fourth of the cost of that luxury model new. We will keep looking for a deal like that.

Whether buying new, used or leasing, choose a car plan that fits into your financial goals.

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Money Left Unclaimed in Dormant Accounts

Ray’s Take: It’s crazy to think that there are billons of hard-earned dollars left behind or forgotten about in dormant accounts all across the world. But with that much money left unclaimed, there are clearly many reasons accounts go dormant. Moving to another state and forgetting to close accounts is the usual culprit.

In 2017, significant changes were made to the Tennessee unclaimed property law. The revised law reduced dormancy periods for many property types from five years to three years and introduced new provisions for specific property types – including health savings accounts, custodial accounts and stored-value cards. Dormancy periods vary by state and type of account.

To become dormant, the owner of the account must not have initiated any activity for a specific period of time. Financial institutions are required by state law to make an attempt to contact the owners of the dormant accounts. If this is unsuccessful, unclaimed money in the account is transferred to the state’s treasury department – meaning they get your money.

If you think you have forgotten accounts and unclaimed money, the best place to begin your search is www.Unclaimed.org, the website of the National Association of Unclaimed Property Administrators (NAUPA). This free website contains information about unclaimed property held by each state.

There are services that offer to search for unclaimed inheritance money for a fee. Unless you have reason to suspect that there is a significant sum of unclaimed money out there or your loved one lived abroad, it makes more sense to conduct the search yourself.

I saw a funny commercial suggesting that some people who’ve changed careers keep their old business cards just to remember where their old 401(k) accounts were. Be sure to keep track of all your accounts and never let them go dormant. Even though a dormant account is inactive, it is still subject to fees and maintenance charges, which can erase the balance of your account over time or even put you in the negative.

Dana’s Take: Have you visited your storage unit or lockbox lately? In them, you may find some of your very own unclaimed property, like rare coins or family jewelry. It’s funny how we move these collectibles around, but don’t actually use them. Consider a family meeting to decide what to do with family valuables.

Fees on storage units really add up, and most of what they hold is guilt. Often storage units hold sentimental things, which are the hardest to release. In Peter Walsh’s excellent book, Let It Go, he emphasizes that our hearts and minds hold the memories of cherished loved ones, not the objects themselves. Find a nonprofit like Habit for Humanity’s Re-store and donate once-loved treasures to help others.

Check your storage spaces and see if it’s time to free up some physical and emotional space.

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Protect Yourself From Identity Theft

Ray’s Take: Back in 2013, I turned down $1.5 million dollars that I was awarded by a Nigerian prince. He just needed my name, address and social security number to wire the millions directly to my bank account. I also won the lottery several times over the last several years. I completely forgot to send my personal information to the “lottery office” so unfortunately I didn’t get all those winnings.

 

Everyone has stories like these if you use any kind of technology and while these examples of identity theft seem comical, there were 16.7 million victims of identity theft last year. Thieves stole over $16.8 billion dollars from U.S. consumers. Identity theft happens once every two seconds. Basically, you are more likely to become a victim of identity theft than having your car stolen or your home burglarized.

 

There are all kinds of identity theft programs out there that offer identity theft protection plans such as Experian, LifeLock and Identity Guard, just to name a few. If you don’t have room in your budget for these protection plans, here are some basic things you can do to keep your information safe.

 

Income tax identity theft cost the IRS approximately $6 billion last year. File your tax return early to beat criminals to the punch. Make sure your anti-virus security software is up-to-date on all of your devices. Keep your passwords and security questions secure and change them frequently. And limit the use of your ATM card and use your EMV chip credit card whenever possible.

 

The bottom line is there is no privacy anymore and there is nothing that can protect you 100 percent. Simply do what you can to keep your personal information safe and teach your children to protect their identities as well.

 

To report identity theft, visit the Federal Trade Commission website to file a claim, then call the three major credit bureaus to create a fraud alert for your file. In addition, contact your banking institution and complete a police report at your local law enforcement office.

 

Dana’s Take: Since most businesses know us as a number, instead of a face, identity theft has become a real headache. Back in the 1950’s most merchants recognized the faces of their customers but then again, you also couldn’t order a book from Amazon at midnight.

 

Since identity theft seems to be a growing part of modern life, we might as well be prepared for it. Your bills will keep coming and not all creditors are patient. Keep a backup card with an account that will never go in your wallet. Also, keep your money in more than one bank so you can continue to pay your bills while the financial institutions sort out the situation and to protect your credit rating.

 

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Financial Literacy and Adults

Ray’s Take: Can you explain what risk diversification is? Can you identify the effects of inflation? Do you know how to calculate interest? If you answered yes to these three questions, you are better off than 43 percent of Americans and a whopping two-thirds of the world’s population, according to Maggie McGrath in an article written for Forbes Magazine about the results from the first-ever S&P Global FinLit Survey.

 

Also, according to this survey, only one-third of the world’s population is financially literate. The U.S. was ranked a dismal 14th in financial literacy compared to all other countries in the world.

 

By definition, financial literacy is the ability to understand how money works in the world. This means knowing how someone earns and makes money, how to manage it, how to invest it and how to donate it to help others.

 

We have a financial literacy problem in America. Former Federal Reserve Chairman Ben Bernanke, said, “Widespread problems like the subprime mortgage market and the resulting rash of foreclosures and bankruptcies illustrate just how serious this lack of financial education has become in today’s world.”

 

“Financial ignorance carries significant costs. Consumers who fail to understand the concept of interest compounding spend more on transaction fees, run up bigger debts, and incur higher interest rates on loans. They also end up borrowing more and saving less money,” said the authors who compiled the S&P FinLit Survey.

 

When it comes to money and your finances you can never stop learning. There are always new trends, products and situations where you need to spend time researching and educating yourself.

 

There are lots of resources available to help you improve your financial literacy. You don’t necessarily need to attend a class or join an online course. Read as much as you can. You can go “old school” with The Wall Street Journal or Barron’s. Or you can go global with The Economist. Always remember that there’s someone on the other side of every transaction who may or may not have your best interest at heart.

 

Dana’s Take: Rather than facing financial realities and learning how to manage money, some people prefer to spend as if they were their financial “dream self.”

 

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Name SearchWatch Service'>Peter Walsh’s book, It’s All Too Much, he says that we often keep possessions that reflect our “dream selves.” For instance, my “dream self” throws big outdoor parties, so I must keep a dozen tiki torches. Since I have not accomplished this, I should grieve that they represent a dream not realized and get rid of them.

 

Similarly, I think we make financial choices based on our dream selves and not in the reality of our actual paycheck. This is called aspirational spending. Financial education can help people get where they want to go.

 

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