HSAs: Good, Great, and Not So Much

Health savings accounts can be a great way to save on medical expenses and reduce your tax liability when he goes in tax-deferred and it's there when the doctors bill arrives, but is the HSA a good deal for everyone to even qualify for an HSA, you must have a highly technical health plan. Even then, it may not be the best financial planner teacher Rob West tells us who get the most out of a health savings account now at today's broadcast is recorded but we do have some phone calls all lined up but I think you find very interesting and informative. If I'm Steve Moore great to join us for moneywise law so well.

I think I'm confused here. I thought if you qualify for a health savings account because were you did qualify for health savings account because you have a health plan with sky high deductibles, then an HSA is the way to go right.

That's not using this not always the case.

Well first of all we really like HSA's. If you qualify if you can qualify them there a great way to accumulate tax-deferred savings for medical expenses and many financial advisors say there is good or better than some retirement plans because any 65. The penalty for using the money for nonmedical reasons, goes away, but money used for medical bills is still tax-deferred. So there are real win-win, but not for everyone who has a high deductible health plan. What here's why.

Some advisors think that's the case they break down eligible folks into three groups, one where HSA's work great one where they're just good and one where you'd be better off without one. Okay, let's start out on a positive note. What group of HSA fears are hidden in the great groupware works best. While these are the folks who don't need to tap into those phone funds right away on short-term healthcare that allows them to stockpile the cash for retirement. It's such a good deal that some advisors will actually tell you to pay medical bills out of pocket so that you can just let the money in your HSA keep running for retirement.

This group typically has low medical expenses and rarely reach their health plan deductible there also young and can accumulate more money over a lifetime.

By the way, you can contribute up to $3450 for an individual and 6900 for family plus an additional thousand for people 55 or over. So this group can maximize their HSA's potential by investing the money in mutual funds or stocks and not spending it. They're not like spec a flexible spending account so the money keeps rolling over from year to year and earns interest because in some flexible spending account, you lose the money if you don't use it right all of them on the FSA yes okay I let sounds good for folks in that group young healthy able to contribute to the max. But what's it like in the next groupware and HSA is only a good idea. This group actually makes up the majority of folks who have health savings accounts. They have to tap into the account to meet their medical expenses.

In fact, 55% of HSA owners exhaust their total balance every year and an HSA is still good for them. Well yes because they are able to take advantage of tax savings. The money they put in in use for medical expenses is tax-free, so it's still a good deal even if they can't use the account to build retirement savings. So there's one more group left here people who are eligible for an HSA, but maybe shouldn't have one right but for this group. It's not the HSA. That's the problem it's the high deductible health plan that they have to begin with.

Those plans mean you'll be paying $1350 for an individual 2700 for family and medical expenses before the plan kicks in. And even then you're still paying 10 to 40% of covered services.

In most cases.

Now if your meeting these deductibles and still paying a lot out of pocket every year or know that you're going to meet them in the next few years I health savings plan is like using a Band-Aid when you need a tourniquet what you really need to do and that cases get on a more expensive health plan with lower deductibles. Let's great information, but how would an HSA actually be better than a conventional retirement plan after age 65.

Sure, if you withdraw money from a retirement account after age 59 1/2. You're taxed on it but you don't pay a penalty. You can use the money for anything, but you do pay taxes on all of it no matter what you use it for with an HSA after age 65. If use the money for nonmedical expenses. Your tax audit that Angel probably have more medical expenses than you would.

Earlier in life.

And when you use the money to meet those medical expenses. Well, it's tax-free and that's how it's better than a conventional retirement plan. It's called double radii we may have given people a drink from a fire hose here. Great information but a lot of it. I check with your local people at your place of employment for all the specifics that pertain to you will be right you like your life to be infused with joy.

Would you like to interject an internal dimension into even the most ordinary day father Randy own horn says you can when you discover the treasure principle and a concise powerpack style is newly revised and updated book offers a six step plan. Finding the pleasure and eternal rewards of the treasure principle what you discover. Life will never look the same treasure principle is available when you click the store, but moneywise live.org our friends and sound mind investing have been helping Christians reach their financial goals since 1990 with step-by-step guidance for investors.

Just getting started making choices in a 401(k) or getting ready for retirement all grounded in God's word, yes my slogan is financial wisdom for living well.

More information is available online. Sound mind investing SMI website also includes articles, and money and investing sound mind.org it's the Sunday morning service were approaching the crucial point one person in the congregation is just holding on. Let's take a look inside his subconscious captain. We just can't take anymore as many banks have completely one night attention span is shot. I can only give you half and pulse Bella Scotty. We need more power. The sermon lasts for another 20 minutes. I'm sorry Capt. do not like Karen just to maintain his life support systems is the Bible too much for your memory banks. God wants you to understand his word.

He wrote it down.

The Bible contains the key to eternal life to spend time in God's word and tell others about the only way the truth and the life of Jesus Christ. And if that is robbing you of freedom and peace of mind. Christian credit counselors can help where a nationwide nonprofit counseling organization has helped over 3000 individuals in the last 27 years get out of credit card debt 80% faster while honoring that data and phone to learn how Christian credit counselors can help you visit Christian credit counselors.org Christian credit counselors.or call 800-557-1985 two moneywise live time. This was today's financial choices and decisions.

Reminder, we are not live today. We are previewed, but we have some followers all lined up in advance. I think you enjoy the calls. Enjoy the conversation and probably come away with something very practical to apply to your own finances. Let's go to Miami Florida engineering what you question for Rob so we are on our side. Whether we should pay off my book will start tackling our market currently on the debt snowball car yeah I love this question because as we look at the moneywise pie which you can see a visual on that it moneywise live.org to scroll down three quarters of the way, you'll see that we allocate money to living, giving, owing and growing in a level one we want to have a spending plan. We want to start giving in our debt area we want to pay off high interest credit card debts and then we want to save for an emergency fund of $1500 will paying off the credit cards ultimately 3 to 6 months expenses. We moved to level II. We want to move toward consumer debt.

And I like the idea of you paying off the car, then perhaps taking that monthly payment and then start putting that in savings specifically allocated to your next car in a way that's going to allow you to replenish that over time, and we want in our savings or grow category.

We want to start saving for retirement 10 to 15% as a goal. The next step would be as you look toward other debts.

If you have student loans.

I would go there next before your mortgage and here's why. Typically it's a higher interest rate. If you're itemizing you can deduct the mortgage interest. Thirdly, it's not usually a smaller balance so you can pay that off quicker and when you do that money is then put back into your budget versus your mortgage which is going to take a much longer period of time you not see the benefit of that money being freed up to allocate to other things. So I would attack your student loan debt first Jenae and then I would look toward that mortgage and accelerate that at the very minimum look to put one extra payment a year, but if you can do even more than that, we'd love for you to certainly have that paid off.

By the time you retire, if not before.

There's a lot of information there, though. Does that make sense along yeah are you just contributing anything to retirement. At this point okay and tell me about the options you have there. Do you have access to a 401(k). We will follow at home with my children.

Okay yes you can have any matching available. Jenae okay I would take a full advantage of that matching right now even while you're paying off debt. Now if you had credit card that I would say don't do it. But given that he's got the matching there. That's 100% return on your money as he puts it in so I take full advantage of that and then really focusing on that the student loan debt. Once the student loan debt is paid off. I would try to get your retirement contributions up to 10 to 15% of his take-home pay, even if that means you're not gonna pay off the house as quickly because remember compounding works most effectively over a long period of time when you're consistently investing, which is called dollar cost averaging. So let's start taking advantage of that matching the 401(k) as soon as that's available at while were paying off the rest of your student loan debt, and then let's bump that up to 210 to 15%.

Okay.

All right.

Thank you for your call today. God bless you. Thanks, Jenae the skill of the music city I go there two or three times year stand on the street corner wait to be discovered never happens, but George nice to have you with us today.

What's in your mind's eye.

By the way Steve I would for a dollar in the hat if I walked in, so you would you if you walk by their scrolling yeah so far.

People just asked me to stop taking that is from the Lord. Hello George nice to have you there sir, how can we help you will know how people like me will not last thing I haven't been on.

Thanks for bursting Michael George but will try to help you nonetheless is just the coming yeah my buddy Rob. I learned so much from your show last night and interesting. My wife been working through what may be an antiquated model now.

Now that I'm so my question kinda comes from that angle and that I called in but show a number of months ago asking about whether we should hold onto a rental property are not in your infinite wisdom. You said that we should go ahead and sell it and we just closed on it last week and by God's good grace and sovereignty with women delayed a lot of money so we have worked our way quickly through destination 012 and three and so now we've got about 40 grand remaining to pour into what was and is destination, four and five, and so I was wondering what may be the best.

All the big points in destination for those which are heard start to college our retirement for a business and save for major purchases. Those are all factors that are family involved with and we also have primary mortgage which I know kind of that nation. Five so that we are just wondering what the best use of that money would be. I know you just talk to Jenae about dollar cost averaging sure and then you know that. So if I given you enough information. What helpful to get some context to our listeners, George and when George is talking about is what's called the compass money map. Our good friend Howard Dayton, the former host of this program and regular contributor at compass, finances, God's way@compass1.org is just a wonderful ministry and we rely on their books and the navigating your finances God's way small group study and they were really helpful resource called the Money map that tells you what your objectives are.

Each of seven destinations on your way to true financial faithfulness and what George is saying is that he's arrived the destination for which means he's only got his emergency fund of 3 to 6 months expenses. All consumer debt has been paid off his car loans, student loans, is using a budget he's giving and all credit card debts are paid off. So that's great. Let me ask you, George, are you contributing right now to a long-term retirement plan so we will a little more organically emergent on we pretty much put that on hold. I know my wife finally went back to work on putting 5% loan to her retirement plan. And I've recently asked her to check in with human resource format that don't know the answer but I also have a Roth IRA.

My wife lost and she also had traditional rollover in the previous job we have not been giving the courtyard investing at all and that currently. Okay I think that's really your next priority is to try to get that out to that 10 to 15% target of your overall income between you and your wife combined.

If there matching I would include that matching in that 10 to 15% because that's money going into retirement savings but that would be your goal. Whether that's through additional contributions to her 401(k) retirement plans you have and or contributing to the Roth or the traditional IRA. Second thing is make sure you have whatever resources are already in retirement accounts invested properly. So depending on how much is in those IRAs. In some cases you may want to combine them if it's to traditional's are to Roth's and then make sure your invested properly according to your goals and objectives. And if you need some help with our friends, of sound mind investing.org would be a great resource. What is that long-term major purchase savings that you talked about. Well, we will earn and I assume that at some point they will not be worth repairing. So I was thinking that we were… That long that I barely liberal amount for that out so that the more immediate and long term. I like that you do need to be saving to replenish that fund, but I think the key is your time.

Being able to save over time in compounding inside the retirement plan, especially with the tax deferral is really critical. So I think that's where I would focus. Next is trying to get that up to that 10% target while you're saving for the car fund and then ultimately up to 15% is really where I would head from here, but it sounds like you're doing a great job. So congratulations on your hard work.

Thanks for your encouraging comments earlier as well George, we appreciate and thank you George you guys really seem like you're heading in the right direction with God's blessing and always nice chat with you. You're listening to moneywise live he's Rob West times more your you and it's a pleasure to have you with us today. Don't call were not live or prerecorded, but we are uncertain times, place, and Michael blue's new book financial help is a hands-on study to help just a short assessment will show you where you are now long before age is financial wisdom and action plan in writing transform your finance right now requesting financial support, moneywise live with the gift of $25 more moneywise live and work to which the parent is not God. Everything you have or do anything you might think put you in bondage.

Your physical temple.

Any backup from.

I'm not saying that we do not have. This is not to bring glory to God to show his glory's power. Not saying I think is just destroying the body. Self inflicted distraction and you see how we can now that Bible study 930 30 Central no problem agreeing with you more about our money than most of us imagine Jesus is more about our use of money and possessions and about anything else, including both heaven and hell in managing God's money on the Randy Elmore and breaks it all down in a simple, easy to follow format that makes it the perfect reference to if you're interested in gaining a solid biblical understanding of money, possessions and eternity managing God's money is available when you store moneywise live.org it's moneywise live were here Monday through Friday, at this time. We love chatting with boats all across the country. Reminder today's program we are chatting with lots of folks but we're not live.

We're off today and so were prerecorded and we do what we normally do, which is lineup colors well in advance were pleased with that were pleased to go to Baltimore, Maryland. Now Ann Robinson had a Carol Carol were so glad you called today how can we help you card my credit card my credit card company here that yes yes that's right, Carol. You bring up a great point. I think what you're referring to is on a recent program. We talked about an exercise that a good friend of ours did, where he went a cash only and used envelopes is the envelope system with specific envelopes for certain discretionary categories to see if he would spend less than the net result even after the rebate was that he did in his conclusion was that the reason that happened was he didn't want to part with the money and so when he actually had to hand over cash. He concluded that there were certain purchases that he just opted out on because you didn't want to give up the money and pull it out of the envelope. Now, does that mean we should never use credit cards. Absolutely not. We actually don't say that what we say is only use credit cards in the context of a balanced budget and use the card for budgeted items and take full advantage of any rewards or rebates you get a special of their cash rewards and you're not paying any kind of annual fee of any kind which I'm sure you're not, so I don't any problem with what you're doing. I think it's just important to recognize that when we use cash for certain things.

Some may find, in fact, many may find that they'll actually spend less then even the rebate just because of the emotional connection we have with our cash. Does it make sense yeah yeah but I appreciate you sharing how you handle things.

I assume Carol you live on a on a budget, give a written plan on I have to be real careful, absolutely. What system do you use do you track it on a spreadsheet or do you use a smart phone app are given envelopes as to how do you do it all. I like that's great. What we appreciate you waiting on the program today. May God bless you, thank you very much Carol. I Bless yes he is. People like Carol really that don't have the kinds of problems we talk about a lot, which is people who just don't feel it when they use credit cards so they tend to overspend and many people just don't have a budget it's kind of flying by the seat of your pants but you know she's she's well organized an organization really is key. Whether it's the shoes in your closet or what's in your wallet.

That's exactly right Rob, I got an email question here from Rita. She says dear Rob, my name has been on my son's credit card since he began college he is not a spender and has been saving to buy a house. We both like to take my name off the card we have to cancel it and apply for another card. Would that lower his credit score. Yes. Well Rita what you're likely going to find is that the lender is not willing to take you off the account. Keep in mind as soon as they drop your name off there going from two people that they can rely on to make sure the balance is paid down to one which is not in their best interest.

Now keep in mind you can in fact close the card and assuming he has the credit score and the income and the ability to qualify on his own.

That would be the very best way for you to accomplish what you're looking to accomplish and that is for him not to be attached to your card but for him to have his own credit card that he takes out in his own name. Will that lower his credit score know it shouldn't. You know if he has an inquiry that may temporarily lower it, but to think the key is make sure you're on time payer and you keep your utilization well under 30%. I would say, better yet, pay it off in full every month and tell him the first month that he doesn't go ahead and cut it right. Information that's the voice of Rob West. Our host, and it's a pleasure to have you with us today to visit our website. It's a brand-new updated website looks pretty snazzy. We think check it out moneywise live.oh. Investing is more than just returns. It's an expression of who you are and what you value is the way you invest your money reflect your identity as a Christian that eventide we design investments for performance and a better world so you can invest with the confidence to reach your financial goals while remaining true to your Christian values and commitments.

We call this investing makes the world rejoice more is available@besteventide.com invest eventide.com Christian healthcare ministries enables believers to meet their healthcare costs affordably, biblically and compassionately. It's not insurance but a voluntary cost-sharing ministry based on the biblical example of Christians sharing each other's needs and members are defined under the law for not having health Christian healthcare ministries might be your health cost solution call 800-791-6225 or visit CH ministries.org Moody radio is found in Psalm 91 through 60 because he loves me, says the Lord. I will rescue knowledge is will you call on me and I will answer. I will be with him in trouble. I will deliver him and honor with long life I will satisfy him and show him my salvation, that is Psalm 9114 through 16. Moody radio's of the week. Call one 800 buying a home is the largest most nerve-racking perches. Most of us ever make. It doesn't help that you're entering a maze of unfamiliar words and confusing options that can leave you intimidated frustrated and afraid. You can take advantage of navigating the mortgage maze by Dale Vermillion helps you clear up the confusion on rack your nerves and make the best mortgage decisions possible with confidence navigating the mortgage maze available when you click the start button moneywise live.org is on drugs, but Annapolis has agreed to back control goals by police and require officers to try to stop any other officers I see using improper force New York City Mayor Bill de Blasio says the light is not a protest over the death of George Floyd were largely peaceful. The Palacios is the 8 PM curfew though will continue through Sunday as planned. US forces carrying out two sets of air strikes against the Taliban in western and southern Afghanistan strikes were the first following a brief cease-fire declared by the insurgents or major Muslim holiday last month starts closing out the week with a bang up or a closely watch report on the jobs market surprised investors, employers, adding 2.5 million jobs a night without getting 829 points today. The NASDAQ had 100.agape, the S&P tucked on 81 this is SRM news moneywise today talk about the Bible and your money and what God has to say about managing it managing it well is a good steward. Let's go to Cleveland, Ohio hello Jean, what's on your mind today wonderful things.

So I called and I love program to know how to get a lot of good information from you guys lately about the relative state. I bought a home in 2003 and 2008 2009 there was a really great crash and the property. Now you get.

I bought a home for hundred 27 now, and currently all 90 out and interest is 5.1% and I did talk with the County auditor and had them to reappraise the house because they were appraising at lower value and they only went up a couple of out on how out I mean how out around their neck comparable so there's no and I don't know what to do with the how we act. We do love love how black other than letting them foreclose on an even know where I don't know what you help me out with the values again. He said it's you owe about 190. Is that right now. Don't know 99 90,000, and we believe it's worth at wired about 115 Natalie and you know what crash and whatnot but the auditor on appraised it at 69th out yet with the assessed value.

Jean is really not what it's could be sold for. So what you would need to do to determine the actual value of the home is probably get to a broker's price opinion from a local real estate broker or you could engage a realtor to actually do a CMA comparative market analysis and really help you determine what's the likely value of the home. If it were to be sold, which is going to be different and higher than what the county assesses it out for property values and taxes because that's really the value here and it's good and what could be that it's more in line with that 115 that you think it's worth, which would mean that you have about 25,000 in equity in the home.

Beyond that, if you're not planning on selling it and you can afford the mortgage payment then you know it doesn't really matter what it's worth today. Because you can continue to live in it. So tell me about that. What is your budget look like and are you able to make the mortgage payment and cover all of your other expenses. Mortgage payment is not an issue.

It actually $848 a month and I will write not behind heaven. You know ever been behind delete the monthly bills and whatnot. I have about five months where emergency saving if need be. But you know talk about refinancing, but it doesn't make sense to refinance to me because the interest rate that we have now at 5.1%. And what would that do with that.

It put it in a longer time frame.

All well. A couple of things I wouldn't be terribly concerned about the equity position because it's again likely that you're either at a good position where you are, even in terms of what you owe versus what it's worth, but what's more likely is that it's worth more than what you oh so you're not upside down number two, you're able to afford the current mortgage payment. That's a good sign and I would say just continue on. It may make sense to refinance it because you if you have good credit, potentially you could get it down to around 4%. If you could save a point, then I would be inclined as long as you plan to stay for at least five years and you don't extend the term, meaning that if you have 15 years left on this mortgage, you're knocking to get a mortgage of more than 15 years that may though even with the lower interest rate pusher payment over what you're able to afford you would need to look at that, but if you could afford the payment you don't extend the term you plan to stay in the house and you can save at least a point that I think it may make sense for you to refinance. But at the very least, I would just sit tight and continue making that mortgage payment and just be encourage that you have a home you can afford and that you love Jean.

We appreciate your phone call today and we certainly hope that that helps you as you work through this. Thanks very much a time for one more Chicago Illinois Maia what situation are you facing one and then a lighter okay.

Just a couple nine found in helping a lot that we have and were wondering where to just allocate our money where to parent. We only have about 19 emergency saving family living expenses. We have a car that had a low interest rate and we have a mortgage and we have learned that is really, currently $81,000 is six point learned a few different loan compiled together government land at 6.8. Most of them at .8 interest alone every month is like $420 accumulating because it's such a large we just don't know where least in Chile Palatine one actually looked into it. Refinancing loan is that you have a financial hardship like that you can postpone payment if we go to a private lender. That's no longer an option. If we do refinance interest rate would be lower that 30 years it would be a 15 year payoff, but the payment would go out the couple hundred dollars and were worried about whether or not we can aimed well my I appreciate that background that's really helpful I would say first of all, be encouraged.

You're doing the right things you're thinking about the right things. I love the fact you got this one months in your expenses in your emergency fund. Let's continue on a systematic basis try to increase that I would like for you.

The chart start contributing to 401(k). If you have any matching so you can take advantage of that. But keep your budget really lean and let's continue to focus on the student loans. I'm with you if you have to raise your payment even though you're bringing the interest rate down with giving up the flexible repayment options that the government offers. That would make me a little nervous because of you had a disruption in your income, something unexpected comes your way, you wouldn't have that to fall back on. Even as a temporary stopgap and it could really create a difficult situation for you, so I'd stay the course, even though it's difficult at times it can feel like are we ever going to get there. Just keep trusting the Lord. Be faithful in your giving diligent in your savings. Keep your lifestyle and check just continue to attack their student loans snowball those debts if you can from lowest to highest balance as well. Thank you very much will be right there to save all joint trust microbrews financial hands-on study showed 4 inches of financial wisdom help my power right now you support lines not gift of $25 lines. My dental work and I'm here to help you understand God's purpose for your life to the eyes of a layman. Archers are full of overachieving Christians lacking joy in their lives. I know because I was there giving generously by time and resources of loving our pastor without having that bouncer myself, I knew something was busy but had no idea what it was until I met her building with in the space of an hour with a man I didn't know it never saw again. My life was radically and forever changed. God brought Herbert in my life to ignite my life with his razor focus on this one thought God's called all of us to seek and save the loss that none should be lost. That's why God sent his son to this earth would God's purpose for dying becomes your purpose for living. Your joy will be full. Your job is ignite revival outside the walls of the church by moving everyone every day closer to Jesus. You need help doing that. Go to RTW.com sheltering in place as one of us will retreat into an emotional shelter trying to get something Billy Graham and many are trying to flee from situational business situation without trying trying to run running all across God has provided everything by surrendering your life to Jesus Christ more find peace with God. That is fine piece with God.net from the Billy Graham evangelistic Association. Do you know the seven things not to do with your money and uncertain times, and would you like to know the 10 ways to trim your budget amid the current pandemic you get those answers and much more. When you subscribe to the new money wise magazine will receive valuable expert articles and easy-to-follow advice will even get access to exclusive podcast episodes and your subscription is free access to the money wise magazine moneywise live.work/lineup is talk about counselors and help you with your money with finances, budgeting, things like that certificate of advisors you may be asking where do I find all of that. Well, it's easy to find.

In fact easier now than ever for its at the brand-new updated moneywise live website moneywise live.org there are links to free resources. Things like budget templates things to get you going in that regard radio archives past radio programs. Also how to find find a certified kingdom advisor in your area wherever you are in the United States and also how to connect with a budget coach at no charge. Get all of that and much more. When you visit our newly updated website moneywise live.O RG now back to our callers, Fort Lauderdale, Florida Roy, we know you been holding. We do appreciate that and what you question $2000 in credit card 21 something old on it and went to and the house needs a lot of it. Now I would think maybe you maybe 50 or 60,000 near the house. I was wondering if I should try to get out on loan to consolidate my car and then and try to fix the house. I'm sure if I can get that money out of the one thing that is not a good idea to make unsecured loan secure in me well and I appreciate this background Royce of 50,000 in credit card and then with the $21,000 mortgage. Are you able to meet your expenses on a monthly basis. Are you able to cover the minimum payments on all the credit cards plus keep the core mortgage current in all your expenses on a given month are you falling further and further behind in adding to that credit card yeah sometimes I am 70 more difficult to be a credit card and sometimes I'm getting a late on them might credit this to someone but I'm planning that I'm finding it really hard to these God because three of these cards. I think it's over 303 4360 each month and most of that is on its interest.

Okay, here's what I like for you to do. Roy is a first step and then feel free to call us back if you have further questions. We really need to solve for this credit card debt that's really what's creating so much of this challenge and if you're continuing to it were just going to make this situation worse. Let's put the repairs on hold right now unless they're absolutely critical like you have further damage to the home because water is pouring in or something like that and let's try to figure out a situation to get those credit cards paid on time and with the balances going in the right direction.

The best way to do that is through a debt management program. I want you to call her friends at Christian credit counselors. In fact, if you have a computer you can do it online Christian credit counselors.org there to go through your budget with you there to look at all your credit cards. They're going to determine how much interest there.

They can save you. And there probably can build get those interest rates way down. You're going to pay a similar maybe a little bit lower monthly payment but it's gonna be paid off 80% faster because you're going to have so much more going to principal on a monthly basis, the cards will be closed you'll be able to pay them off much quicker if we can do that in line with the balanced-budget get a little bit going to savings even $50 a month now. When you have an event come up that you didn't plan on or you have a little bit lower income in the month you've got a bill a savings account that's growing that you can tap into were not going back to the credit cards.

So let's start there.

Don't refinance the mortgage, call her friends. Christian credit counselors.org and then will will pick back up with you. If you have other questions. At that point right we do appreciate that.

We wish you the very best and feel free to call us back down the road. Once you connect with those folks and they get you in some sort of a plan. If you have further questions. Again, feel free to give us a call around Carol called her. She didn't want to be on the air as she's in Arkansas and I were going to try to read her question. She has a grandson who is 2 1/2 of that, they opened up a mutual fund for the birth mom refused to give them the young man's Social Security number, the birth mom wanted to be the guardian of the account and didn't like the fact that that they were were trying to become the guardians. Is there anything better Morris or something better they could do for their grandson is currently in her name. Yeah, it's probably a POD account was called, payable on death and it's in their name meaning. That's their account they own it outright, but at their death. He would receive the account, the grandson, one of the challenges with that type of account is that that money would go to him and he be able to use it however he wants. Depending on his age and level of maturity, spiritual maturity, financial maturity, it may or may not be a good thing. I do like the fact that their generous they're wanting to put this money aside form and they're doing it away were to be able to grow and accumulate. I'd recommend for Carol, Steve, a 529 plan. It would require that this money be specifically allocated to college.

The cost of college and of the total cost of attendance, but it would give him the resources to be able to further his education could be done in a way where it's it's their account but for his benefit could even be put in the parents name, but it would be for the sun and then they could contribute to it.

The money would be invested and that it would be something that would be a real blessing to him down the road.

Apart from that that they don't have his Social Security number. They couldn't do a uniform gift to minors act, which would be a custodial account so they probably just need to stick with this POD, but I think the 529's can be the best option okay and Carol. We appreciate your your contacting us today and we hope that information helps you. Thanks so much.

Brought home another email okay just that one thing that Social Security number is going to be an issue even for the 529 if they were to open it there to have to have the Social Security number, so I think the next step is probably to sit down with mom and dad just say here's our heart, we want to try to bless them. We want to do something for him. We think college is a great thing what you think and see if you can create some alignment around what you're doing and why and see if they be willing to help you and in terms of opening the account, we used to tell people just several years ago not to give their Social Security number for an ID when you check into your doctor or just about anywhere these days that has an office of the first thing they want to know is what your Social Security number are we beyond that, is that almost impossible not to do or cannot do these days.

I'm not ready to say that. Actually, I would be very suspect about giving out your Social Security number to people that asked for it. Often times your doctor.

For instance, will ask for it, but it may not be necessary because, you know, even though they may say they needed and it may be for insurance purposes. I would see if there's a way to get around that, because who knows where they're storing it and how secure that information is your golf course going to have to provide anytime you're opening a financial account that's a requirement as a part of the federal rules and rags, but I wouldn't be volunteering that information I be pushing back wherever possible and what works for me is when asked for the number I give them your number and so far I'm I'm good yeah yeah I'm glad I mixed of the digits in riches, Rich Russells, so I see. So as a broadcasting team would just sort of passing it down past who passing the buck you are and here's an email from Melanie. She says I'm 66 years old, single and in good health. I'm on a fixed retirement income and working part-time. I'm carrying debt of $36,000 from six major credit cards and a student loan I'm making on-time payments above the minimum of my FICA score is 706. Should I go to a debt management program or sell my home and rent a condo or anything else you would suggest she 66 years old. Yeah well I think the key here is we want to try to get out of this debt as quickly as possible that you have a good credit score. That's great. You've obviously managed your financial situation well to this point, I think the key Melanie moving forward is how can we get out from under this certainly a debt management program, something we like to help you pay off this debt credit card debt 80% faster. Assuming you want to stay in this home.

If you were planning on downsizing anyway then you might as well go ahead and sell the home. Begin renting get out from under the credit card debt in full.

Assuming you have some equity that you could put toward it right size your budget be completely debt-free. Which would you would feel very good and that if you have a surplus at that point you could begin saving up for the purchase of another place if you wanted to own something. So I think it really comes down to your plans for your living situation. If this really is your forever home and it fits in the long term plan that I would said that management programs can help you pay off this debt much quicker if you were planning on downsizing. Anyway, I'd probably do it pay off the debt and then you feel a lot better at that point right well we hope you feel a lot better from listening and for tuning in today moneywise live is a partnership between Moody radio and moneywise media and we certainly appreciate their partnership and yours. Thanks so much for tuning in for listening for calling and for telling others about us if you'd like to send Rob Weston email make it brief, just a couple of lines than the address is questions@moneywise.org questions at moneywise live questions@moneywise.org website is moneywise live.org and my thanks to Jim and Amy gabbing to you and Judy for joining us today and doing all the tech stuff behind the scenes and again thank you for listening. Have a great remainder of your day. Join us again next