Day: March 10, 2020

Pence: Americans won’t get ‘surprise’ medical bills for coronavirus tests

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People who get tested for the COVID-19, the disease caused by the new virus SARS-CoV-2, don’t have to worry about getting a surprise medical bill, Vice President Mike Pence said Tuesday.

“We want people to get tested,” Pence said at a White House meeting with President Donald Trump and leaders from private health-insurance companies. Health-insurance company CEOs have pledged that patients won’t get unexpected bills after being tested for the novel coronavirus, and they’ve also agreed to waive co-pays for people covered by their plans, Pence said.

Pence said he spoke on behalf of insurers who cover some 240 million Americans, either through private insurance or through Medicare or Medicaid. By Tuesday afternoon, the U.S. had 804 cases of the coronavirus, and 28 deaths.

Pence’s announcement came after several major insurers — including Aetna CVS, +0.94%, Cigna CI, +7.76%, Blue Cross Blue Shield ANTM, +6.31%, UnitedHealth UNH, +2.99%, Anthem and Emblem — had already pledged not to charge patients out-of-pocket costs for the coronavirus test. At Monday’s White House meeting Humana HUM, +4.50%, Centene CNC, +8.23% , and Kaiser Permanente joined the list. Some analysts expect insurers will have to raise premiums next year to cover the unanticipated costs of the coronavirus.

Previously, the governors of California, New York, Vermont, Washington and Maryland had said insurance companies in their states wouldn’t be allowed to charge patients for the coronavirus test.

Some public-health experts have warned that Americans may be reluctant to get tested for the sometimes-fatal novel coronavirus COVID19 if they’re worried about paying for the test. Stories about patients racking up hefty hospital bills related to coronavirus have sparked fears about its potential financial toll on individual consumers.

Surprise medical bills, which typically happen when a patient gets unexpectedly charged for out-of-network health care, affect many Americans. One in five Americans who undergo elective surgery — or surgery that they schedule in advance — incur unexpected out-of-network medical bills, a recent study published in the Journal of the American Medical Association found. The average surprise bill was $2,011.

The contagious, sometimes fatal novel coroanvirus has been spreading in the U.S., and public health officials have raced to test potentially infected people to help halt transmission. The Centers for Disease Control has slowly ramped up testing, after a slow start. A total of 2.1 million tests were available as of Monday at public health labs in all 50 states, as well as at other sites such as hospitals and commercial labs, Health and Human Services Secretary Alex Azar said Monday.

Worldwide, there were 118,100 COVID-19 cases and 4,262 deaths as of Tuesday afternoon; about 64,391 people had recovered, according to data published by the Johns Hopkins Whiting School of Engineering’s Center for Systems Science and Engineering.

Republicans are far more likely than Democrats to think the coronavirus threat is ‘exaggerated,’ new survey finds

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As U.S. health officials confirm more cases of the new coronavirus, a new survey suggests that Republicans are more likely than Democrats to believe COVID-19 concerns are overblown.

Some 62% of Republicans and Republican-leaners say the seriousness of COVID-19, the disease caused by the new virus SARS-CoV-2, is “generally exaggerated,” according to a new Axios/SurveyMonkey poll of 4,633 adults conducted last week. Just 31% of Democrats and Democrat-leaners and 35% of independents said the same.

Greater shares of Democrats than Republicans also said they were likely to avoid large events like concerts or sporting events (67% vs. 49% “very” or “somewhat” likely); public spaces like malls, theaters or restaurants (53% vs. 37%); and social gatherings at friends’ and family members’ homes (38% vs. 25%).

The Centers for Disease Control and Prevention have said that community-based interventions like “social distancing” — defined as “remaining out of congregate settings, avoiding mass gatherings, and maintaining distance (approximately 6 feet or 2 meters) from others when possible” — can help slow the disease’s spread, among other measures. A vaccine isn’t yet available.

Democrats and Republicans in the survey agreed, however, on how they would react to a federally mandated two-week self-quarantine for people exposed to the disease: Only 22% of respondents from both parties said such a measure would threaten personal rights and freedoms. Independents were slightly more likely to say the same, at 30%.

There were 116,588 COVID-19 cases and 4,090 deaths globally as of Tuesday afternoon; about 64,391 people had recovered, according to data published by Johns Hopkins University’s Center for Systems Science and Engineering. The U.S. had 791 cases as of Tuesday afternoon.

As the 2020 U.S. presidential race forges ahead, the coronavirus outbreak has hit the U.S. economy and further inflamed partisan tensions. Sen. Bernie Sanders, a Vermont independent, and former Vice President Joe Biden — the top vote-getters in the Democratic primaries — have criticized President Trump’s response to the outbreak and said they would do a better job.

House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer, the top congressional Democrats, have also publicly urged Trump to “prioritize the needs of American workers and their families before the needs of major corporations” while responding to the outbreak.

Trump, who is reportedly considering options including a payroll tax cut and paid sick leave, has accused media outlets and Democrats of spreading fear and trying to leverage the outbreak for political advantage.

“The Fake News Media and their partner, the Democrat Party, is doing everything within its semi-considerable power (it used to be greater!) to inflame the CoronaVirus situation, far beyond what the facts would warrant,” Trump wrote Monday on Twitter TWTR, +3.35%.

Personalities on Fox, the president’s favored news outlet, recently offered divergent opinions on the severity of the outbreak: Fox News host Tucker Carlson warned that COVID-19 was a “real” threat that was “definitely not just the flu,” while Fox Business host Trish Regan called criticism of Trump’s response “yet another attempt to impeach the president”

(Fox News and Fox Business share a common parent with News Corp NWSA, +3.78%, which is also the parent of The Wall Street Journal and MarketWatch.)

The CDC says that immediate risk of exposure to the virus “is thought to be low” for the majority of people noting that there isn’t widespread circulation in most U.S. communities. But it also cautions that people living in areas with community spread of the virus are at elevated risk and that “more cases of COVID-19 are likely to be identified in the United States in the coming days, including more instances of community spread.”

“It’s likely that at some point widespread transmission of COVID-19 in the United States will occur,” the agency said.

Ethereum Drops to $200 Levels as Crypto and Global Markets Crash

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Ethereum (ETH) price has continued to fall after a dreadful weekend, which saw the price drop to around $198, wiping out last week’s gains. The cryptocurrency is currently trading slightly above the $200 support level and faces a nervy week in which it could drop as low as $170.

Ethereum Drops to $200 as Crypto Markets Crash

The coin has had a stellar year to date, having started the year at $130. It reached $280 in mid-February, outperforming even Bitcoin (BTC) in its percentage climb. However, there has been a market-wide sell-off as of late, with Bitcoin falling below the $8,000 level in the last week of February. ETH shed $50 and dropped to $220 and is continuing to suffer.

Following the massive market-wide sell-off, the combined market capitalization of cryptos has dropped from $264 billion to around $226 billion. This is because of growing market concerns that coins will lose most of the gains they have accumulated since the beginning of the year. Since cryptocurrencies are volatile assets, it is important to note that a 20% move in either direction is something to expect from a near-term perspective.

Cryptocurrencies Impacted by Crashing of Global Markets

In the event that ETH rebounds from its current level, it could likely test the $219 resistance level in the short-term, although this will need a surge in volume as a catalyst. The most important thing to note is that the decline in crypto prices cannot be compared to what global markets are experiencing.  However, for Ethereum, the concern is whether bulls are in control of the markets or whether the crashing of global markets will continue to impact the coin.

>> How the Bitcoin Halving Could Affect BTC Price in the Near-Term

This year, Ethereum has made some progress, and the launch of ETH2.0 has been boosted by the rollout of technical improvements. ETH2.0 will be a significant upgrade for the network, as it will add new features and shift to a Proof of Stake consensus.

Featured image: DepositPhotos © sadsadang

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Airlines are slashing ticket prices for domestic flights amid the coronavirus outbreak — and prices could stay low into summer

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Even with spring break just around the corner, airlines have cut airfare prices for domestic flights in United States significantly in a bid to gin up more bookings despite coronavirus fears.

Airfare dropped in price by an average of 14% between March 4 and March 7, according to a new report from travel booking website Hopper. That’s in spite of the fact that demand for domestic travel has actually grown more than usual in recent months, as Americans have grown wary of traveling abroad as the novel coronavirus has spread across the globe.

Hopper’s report is based on data gleaned from billions of airfare price quotes the company collects every day.

Demand for domestic travel is up 6.5% since the first week of January, Hopper found. This time last year, flight demand had only increased 1.3% over that same period of time. Comparatively, demand to Asia has fallen 23% since the start of 2020 and demand to Europe has dropped 5.8%.

Read more:Should I cancel my flight? Will recirculated air on a plane spread coronavirus? Here’s what you need to know before traveling

“The move from airlines came as business travel has dropped dramatically as corporations are advising employees to limit corporate travel for the time being and many large conferences like SXSW are being cancelled,” Hopper economist Hayley Berg wrote in the report. “Airlines are slashing prices to further incentivize leisure travel within the U.S.”

Price declines for certain destinations have been even more pronounced. Miami has seen the biggest average price drop at 35%, followed by New York City and Las Vegas, which both have had 29% declines.

Certain routes are even more heavily discounted. For instance, a round-trip flight between New York City and New Orleans costs as little as $97, which is 68% lower than the average price, per Hopper.

These low prices could continue for many months to come, as the coronavirus situation develops. The decline in oil prices that has resulted from the outbreak could push prices even lower, according to Hopper.

“Low oil prices are likely to continue unless oil producers can align on a unified reduction in production to re-stabilize supply and demand for oil in the market,” Berg wrote. “Low oil prices and volatile demand for travel in the industry will likely mean prices will remain low for travelers through spring and potentially into summer 2020.”

Don’t miss:Coronavirus: Separating facts from hype— and what’s the risk for older people?

Trimming airfares isn’t the only step airlines have taken to attract bookings. Many airlines, such as United UAL, +7.69% , Delta DAL, +0.82% and American AAL, +8.47%, have waived flight change and cancellation fees for new bookings made in the month of March seemingly in an effort to assuage the concerns of Americans who might be nervous about making travel plans right now.

Nevertheless many carriers, including Norwegian NWARF, +0.81% and Qantas QAN, +10.83% , have signaled that they will be cutting flights and grounding portions of their fleet in response to the weak demand the coronavirus outbreak has caused.

TaxWatch: Stocking up on thermometers, first-aid kits and hand sanitizers? You may be able to use your Flexible Spending Account

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Hand sanitizers, medical masks and thermometers are some of the products flying off the shelf as people stock up in preparation for a worsening outbreak of COVID-19, the disease caused by the novel coronavirus. They might have to brave long lines and empty shelves looking for the household goods. Or they might be able to buy the items using tax-free money from flexible spending accounts — emphasis on “might.”

Flexible spending accounts, or FSAs, are tax-advantaged accounts that employers offer to workers. Approximately 29 million Americans now have the accounts, according to one estimate. Account users can use up to $2,750 in pretax income into the account and typically have a year to spend the money on eligible health-related goods, services and prescription costs.

There’s strong demand now for health and safety products as the coronavirus spreads, according to Nielsen NLSN, +5.74%. Hand sanitizer sales in late February were up 313% versus a year ago Medical-mask sales were up 114%, even as the Centers for Disease Control and Prevention advised people not to wear them. Thermometers were up 80% and first aid kits were up 52%

Thermometers and first-aid kits are fully eligible for purchase with the tax-advantaged money.

These are all things consumers can buy with FSA money, but some are easier to buy with these funds than others. Thermometers and first-aid kits are fully eligible for purchase with the tax-advantaged money, according to, an online store where customers can buy eligible goods with their account money.

Thermometers and first-aid kits have long been popular sales items on the site — but they’re especially hot now, according to Jeremy Miller, CEO and founder of Health-E Commerce,’s parent company. There’s been a 51% rise in thermometer sales during the last week of February versus earlier in the month, and a 52% increase in first aid kit sales, Miller said.

Hand sanitizer and disposable face masks currently require a “letter of medical necessity” before your employer’s plan will authorize a purchase with your FSA money. The letter can come from a health-care professional, such as a doctor, nurse or dentist, explained Rachel Rouleau,’s compliance director.

Also see:As coronavirus infections spread, demand for oat milk is outpacing hand sanitizer

Plan administrators are following the Internal Revenue Service’s lead. The Internal Revenue Service determines which products count as providing “medical care” and are eligible for purchase with FSA money. The answers can be tricky. For example, consumers can use the funds to buy the direct-to-consumer genetic testing kit from 23andMe, but not dental floss, bug spray or nitrile gloves. These gloves are an alternative to latex disposable gloves, which can be purchased with FSA funds.

Given the rising concern over the coronavirus, further guidance and broader IRS rules on items like masks and gloves would be a good thing, Miller and Rouleau said.

The IRS did not immediately respond to a request for comment.

Consumers can use FSA money for other health supplies that organizations, such as Harvard Medical School, say people should have if they need to stay home for an extended period amid the COVID-19 outbreak.

• Prescription drugs and medicines are eligible for payment with FSA money with a doctor’s prescription.

• Over-the-counter remedies for fever and pain, like acetaminophen and Ibuprofen, can be purchased with FSA money, but the customer needs a doctor’s prescription. The same rule applies for cough drops, cough suppressant and cough syrup.

Consumers need a prescription to use the FSA money for the over-the-counter items because of a 2011 change to the Affordable Care Act, Rouleau said. The company backs a pending bill that would undo that requirement, she said.

Typically, account holders operate on a “use it or lose it” basis and forfeit any money they don’t use before the plan year expires. But employers can allow employees to roll over a maximum $500 in unused money after the plan year expires, or they can allow two-and-half month grace period spend all leftover money.

Low oil prices are good news for American drivers — if they can take advantage of them

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A steep decline in oil prices would most likely help Americans at the gas pump — but it’s not clear whether people will be hitting the roads much this spring.

Oil prices CL00, +6.58% fell precipitously Monday, triggering a massive sell-off that saw the Dow Jones Industrial Average DJIA, +0.40% shed 2,000 points Monday and the S&P 500 SPX, +0.69% drop nearly 8%. Driving the plunge in oil prices BRN00, +6.19% was the breakdown in negotiations between OPEC and Russia around whether to cut production in response to the coronavirus.

While oil prices rebounded in Tuesday trading, the possibility of a price war among major oil producers remains. And either way, oil demand has weakened considerably in recent weeks as the COVID-19 outbreak has prompted a widespread decrease in travel as people shelter in place to avoid getting sick and countries like Italy have ordered citizens to stay put.

Read more:‘Pasta started flying off supermarket shelves in Milan.’ Italians struggle to adjust to the New Normal amid nationwide coronavirus lockdown

It’s a major turnaround from the beginning of the year when oil prices jumped to the highest level in more than six months as tensions mounted between the U.S. and Iran after an Iranian military leader was killed in an American airstrike. In that case, experts suggested that Americans might be insulated from the overseas increase in oil prices when it came to the price U.S. consumers pay for gas because American oil production has increased substantially since the Second Gulf War.

But with demand for oil severely constrained by the coronavirus outbreak, Americans should expect cheaper gas. “The most major component of the price of gas at the pump is the cost of oil,” said Sarah McCrary, CEO of GasBuddy. “As oil prices go down, we will see reductions in costs in price per gallon for consumers at the pump.”

As fuel prices decrease overall, the difference in gas prices from one gas station to another will grow.

How those reductions in gas prices play out at the local level will vary greatly. When fuel prices decrease overall, the difference in prices from gas station to gas station grows, McCrary said. In Miami, the spread between the cheapest and most expensive gas stations is 54 cents per gallon.

Part of this spread relates to where individual gas stations get their fuel and the price they pay for it. But gas revenue is only one part of a gas station’s profit — most gas stations actually have larger margins with their convenience store business. So some gas stations will lower gas prices in order to attract customers who will purchase not only gas, but also snacks, drinks and other items from the store. “If overall demand decreases, and prices at the pump are not enough to bring consumers in, it will hurt other parts of their business,” McCrary said.

Whether oil — and gas — prices continue to fall remains to be seen, experts said. “There’s never been a historical period that can lend credence to where we are now,” said Devin Gladden, manager of federal affairs at AAA.

How much further gas prices fall will depend on whether people want to drive

There are two conflicting trends in the market right now that could increase or decrease gasoline demand — and both are related to the coronavirus.

Airline, hotel and cruise stocks have tumbled in recent weeks as people have cancelled travel plans out of concern over the illness outbreak. With the popular spring break travel season fast approaching, it’s unclear whether people still will opt to go on road trips.

Also see:As recession fears mount, here’s why home prices may not plunge alongside the stock market

But that doesn’t mean people aren’t driving. “We’re hearing reports of people driving more in their cars because they don’t want to be on planes or public transportation,” McCrary said.

‘We’re going to see gas prices start off the spring cheaper, when they would normally otherwise rise.’

— Devin Gladden, manager of federal affairs at AAA

Whether the overall fear of traveling right now outweighs people’s preference for driving in lieu of mass or public transportation remains to be seen. If demand does increase, that could temper the decline in prices; otherwise, prices could drop even further given low traffic to gas stations.

Either way, this spring looks poised to be one of the cheapest in many years when it comes to gas prices. The spring months typically see higher prices because fuel refineries must switch their machinery over in order to produce fuel tailored to the summer rather than the winter. Gas in the summer is more highly refined to reduce pollution in the hotter weather, but this process is more expensive.

“We’re going to see gas prices start off the spring cheaper, when they would normally otherwise rise,” Gladden said.

How can I protect my 401(k) from a coronavirus-driven market downturn?

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How can investors protect their 401(k) and other retirement savings from being depleted when they’re watching the stock market drop?

All three major stock indexes fell at the market open on Monday. The S&P 500 SPX, +0.73% fell more than 7%, causing a halt in trading for 15 minutes, while the Dow Jones Industrial Average DJIA, +0.44% fell more than 5% and the Nasdaq Composite COMP, +0.97% was down 4.3% that morning. The indexes rebounded at the open on Tuesday.

The last month has been hard on investors. Stocks fell into correction territory in February, around the time fears of the coronavirus spreading and affecting global economies began.

See: ‘Moment of silence for every boomer’s 401k’ — internet erupts with gallows humor as market crumbles

For most investors, the money already in 401(k) plans should stay there — especially if retirement is a few decades away, advisers say. But there are strategies to avoid losing that money — and even making more. “It is very important to have a plan irrespective of market conditions — in good and bad times,” said Jay Spector, a partner and wealth adviser at Barton Spector Wealth Strategies in Scottsdale, Ariz.

It’s also important to note that the money is not yet lost until investments are sold. Even if an account balance is lower today than it was yesterday because of market volatility, the account holder hasn’t yet lost that money — unless of course they were to sell their investments.

Here are a few ways you can protect your 401(k), according to financial advisers — some suggestions have little to do with the account itself.

Don’t touch it

Market volatility is normal, as is an investor feeling overwhelmed by his account balance moving sporadically. The best time to come up with a financial plan is before the markets act up — and to stick with it, said Scott Bishop, executive vice president of financial planning at STA Wealth Management in Houston. “Now may turn into a very good buying opportunity, but you should not ‘speculate’ on emotion,” he said. “Rather, have a plan and follow it.”

Portfolios should be diversified with numerous asset classes, under both equities and fixed investments. “Asset allocation and diversification still work,” said William Parrott, president and chief executive officer of Parrott Wealth Management in Austin, Texas. “A balanced portfolio of stocks, bonds and cash will treat you well over the long term.” Financial advisers will typically incorporate the risks of market volatility and potential downturns when drafting a financial plan and portfolio’s asset allocation.

Cash is, at times, king

“You can always look at cash as being ‘safe,’” said Thomas Rindahl, a financial adviser at TruWest Wealth Management Services in Phoenix. Along with contributing to a 401(k), workers nearing retirement should keep some money outside of the market. Some investors may feel compelled to buy as much in stocks as they can while prices are down, but they also need to set some cash aside for emergency funds, as well as a pile they could draw down if they do retire soon.

Those nearing retirement should try to refrain from withdrawing from their retirement portfolios, as a way to protect themselves from the “sequence of returns” risk, which is when investors withdraw from their principals and not gains. Doing so potentially deflates any future returns.

“If you need your money in one year or less, do not invest in the stock market,” Parrott said. He suggests keeping money in cash or short-term investments, such as U.S. Treasury bills or Certificates of Deposit. For those retiring within the next five years, at least three years’ worth of expenses should be in cash, short-term CDs or U.S. Treasurys, he added. “For example, if your annual expenses are $100,000, then your cash holdings should be $300,000.”

What’s the difference between a 401(k) and a Roth 401(k)?
Ask your adviser about these investment ‘tools’

Annuities, which are insurance products, are another way to provide protection of principal, as well as generate guaranteed income, Rindahl said.

There are many types of annuities, which are created using contracts that should clearly spell out the terms, such as time frame for premiums and benefits paid. Annuities overall can be complex products and difficult to understand, so it’s important investors work with financial planners and insurance professionals to make the safest decision for their personal situations. There are a few questions they should ask before incorporating one into their retirement plan.

Congress passed sweeping retirement legislation called the Secure Act in December, which incorporated numerous rules to help bolster Americans’ future financial security. One provision was to expand access to annuities in 401(k) plans, in an attempt to safeguard Americans from outliving their nest eggs.

Also see:How much of your 401(k) retirement plan is affected by market volatility?

Keep adding money to the plan

Another way to protect your 401(k)? Keep contributing to it. Many investors use drops in the market as an opportunity to buy into equities, and then wait for them to rebound.

Those nearing retirement may want to hold on to a job, or for those already in retirement, take up part-time work to add an extra source of income. Continuing to work is one way to avoid withdrawing from retirement assets, and is beneficial because it adds more to the portfolio. “Find ways to generate income,” said Jake Northrup, founder and a financial planner at Experience Your Wealth in Bristol, R.I. “The ability to turn up and down your income is such a powerful planning tool to protect against down markets.”

Next Avenue: How do you keep busy in retirement? Here’s a to-do list for your first day

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This article is reprinted by permission from

You’re standing alone on the edge of a cliff, staring off into a vast unknown. Is this you, thinking about retirement?

Or as one man told me during my research into the new retirement: “So I wake up in the morning, go to the fitness club and have coffee at Starbucks while I check my email. It’s 9 a.m. Now what?”

Financially, he could retire. But he’s still working, in part because he likes it, but partly because he’s scared to death.

And he’s not alone.

If you’ve reached 65, the odds (depending on your gender and marital state) can be close to 1 in 10 that you’ll make it to 100. So, if luck and good health are with you, you’ve got a chance of having maybe at least three good decades ahead after you leave your full-time job.

Demographically, we’ve never been here before. This is totally uncharted territory. No guidebooks, and not a lot of role models either. We’re all pioneers.

My Harvard M.B.A. helped me in my business career, but it didn’t tell me about this. So, I’ve been interviewing some 500 men and women, writing and holding workshops, all trying to answer one key question: How do people actually do this new retirement?

The 3 C’s of retirement

Based on what I’ve found out, let me suggest a plan for Day One of retirement:

It’s about the 3 C’s.

Clean out your closet

Really. Now this can be your actual closet(s), or your home office or your garage. The point, Marie Kondo notwithstanding, is to give you something useful to do.

But, of course, it’s not just the physical act of cleaning out these spaces that’s helpful. It’s about the virtual act of making space, clearing out old stuff and giving you a more literal clean slate for building your new life.

Don’t miss: 2 gorgeous countries with ‘high quality’ health care — where you can live on less than $2,500 a month

I don’t need to tell you that retirement is one huge transition, especially if — for years, or maybe as long as you can remember — you’ve been used to the structure of worklife and the social environment of the workplace. So, mark the transition physically by tossing out the old stuff. That way, you can make both mental and physical space for the new.

Start to cultivate your curiosity

Now’s the time to explore.

That might be looking into taking online courses or classes at a nearby college — extension courses, continuing education programs and opportunities to audit classes. You could also visit your community’s website to see what recreation and educational programs are offered locally.

Try googling “lifelong learning near me.” You may be amazed at what your search turns up.

If you’re up for brand-name online learning from top institutions, check out the 2,500+ free classes on the MOOC (Massive Open Online Course). Or hang out with the experts on cooking, magic, poker, screenwriting and more at ($15 a month).

Or sign up for yoga or Tai chi at the community center.

Or take a hobby for a test drive. You could go to the Apple Store and learn how to edit your photos. Enroll in a painting class, try ceramics, learn glassblowing …. You’re not making a lifetime commitment here. Maybe you were meant to be a wood carver, maybe not. See what takes hold.

Or volunteer by seeing what’s up on, a nonprofit portal listing over 100,000 volunteering opportunities in nearly 100 U.S. cities.

Or plan to visit exotic places you’ve always wanted to see.

Also see: Why having a bucket list can be a big mistake

If you want to combine travel and volunteering, check out a website like, from the world’s largest voluntourism community.

This could be the time to begin reviving your passions. Think back to what you loved as a kid, the dreams you had before you had a mortgage and school tuitions. Join a model railroad club. Dust off the clarinet you’ve kept on the top shelf all these years. Sit down to start writing the novel you once began.

While you’re indulging your curiosity, here’s the third C: Coast 

In other words, on Day One of retirement, talk yourself into taking your time to figure out where life will take you.

Enjoy your newfound freedom and don’t expect to create your new life plan overnight.

Many people take a couple of years — enjoyable years — to get in touch with distant family, spend more time with friends, get back in physical shape, join book clubs or religious groups or political groups. What’s the hurry?

This is your chance to discover, and uncover, the authentic you. Said one woman I interviewed about the retirement she and her husband have begun: “We’re finally living the life we want to lead.”

The word retire comes from the French: “to withdraw,” “to pull back.” Yikes. No wonder we find the idea of retiring uncomfortable.

It’s not about pulling back, it’s about jumping in with both feet. Or, to change the image, about taking wing and soaring off that cliff.

Creating a new life is exhilarating and it’s an opportunity most of us never thought we’d get.

Sure it’s a change of mind-set. Sure, it’s about crafting a new identity. It’s a time to reinvent, to redefine who you really are…to refocus on what you think is really meaningful.

So, when you come back home from the farewell party at the office, prepare for the luxury of sleeping in and then get up to start your next chapter — you’ve got a plan for Day One.

Connie Baher is a writer and lecturer on reimagining retirement, and a sought-after career transition specialist. Author of “The Case of the Kickass Retirement,” she has written for the Boston Globe, the New York Times and other print and online media. She is a Harvard M.B.A., an entrepreneur and a former tech executive.

This article is reprinted by permission from, © 2020 Twin Cities Public Television, Inc. All rights reserved.

NerdWallet: This couple paid off $179,000 in less than 4 years and rebounded from bankruptcy

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This article is reprinted by permission from NerdWallet.

In this series, NerdWallet interviews people who have triumphed over debt. Responses have been edited for length and clarity.

Rashad and Nirvanna Muhammad

How much: $179,000 in 3 years and 10 months

Rashad Muhammad, a school principal and part-time real-estate agent, started racking up debt while attending Bethune-Cookman University in Daytona, Florida. That’s where he met his wife, Nirvanna, who had her own financial struggles.

Although he had a football scholarship, injuries led Muhammad to take out student loans during his junior year. After graduating, he took out more loans to pursue a master’s degree in educational administration.

We had to tell the judge our total debt out loud and I remember hearing someone chuckle in the background. It was eye-opening and humiliating.

— Rashad Muhammad

The couple merged finances after getting married in 2005, combining their student loans, credit card debt and car loans, and later moved to Texas in 2007.

As their family started to grow, their debt grew, too — at one point reaching $250,000. Their debt weighed heavily on Muhammad, especially when Nirvanna temporarily stopped working as a teacher in 2011 to have their second child.

Feeling desperate, the couple decided to file for Chapter 7 bankruptcy in 2011. [Editor’s note: In some cases, bankruptcy is the best option for handling overwhelming debt. If your non-mortgage debt is more than 40% of your income or would take more than five years to pay off, consult with a bankruptcy attorney.]

The process eliminated their unsecured credit card debt, but it didn’t dramatically alter their finances — or their spending habits — overnight. They still had student loans. They also took out new car loans to replace the cars they lost during bankruptcy. In the midst of having their third child in 2012, they amassed more credit card debt. By the spring of 2013, they owed $179,000.

Over nearly four years, the couple took steps and made sacrifices to pay it all off. By January 2017, they were officially debt-free.

Today they live comfortably in Fort Worth, Texas, with their three children, ages 7, 9 and 13, and are able to afford vacations and save for retirement.

Also read: This 34-year-old paid off $81,000 in student debt, but not before it took a toll on her mental health

Muhammad spoke with NerdWallet about recovering from bankruptcy, what he learned about tackling debt as a couple and which financial goals they’re prioritizing now.

What was your total debt before you declared bankruptcy and when you started your repayment journey? What is it today?

Before bankruptcy, it was around $250,000. We had $30,000 on one car, $25,000 on another car, $125,000 in student loans and $70,000 in credit card debt. After bankruptcy, we ran up more credit card debt and had to get new car loans. By March of 2013, we had $179,000 of debt. Today we are debt-free except for the remainder of our 15-year mortgage.

How did you originally end up in debt?

I went to college on a football scholarship and knew nothing about finance at the time. I didn’t know anything about saving and had been living paycheck to paycheck my entire life, which I thought was normal. My wife also had student loans and credit card debt.

As a football player, I wasn’t allowed to have a part-time job because it was considered illegal to work while playing football. After I got injured during my junior year, I started taking on student loans. I also got a master’s degree after graduating, so I went up to $59,000 in student debt.

What made you two decide to declare bankruptcy and what was the process like?

My wife had to take off a few months of work when we had our daughter in 2011, and the debt was overwhelming. When this second baby came, we were making decent money, but all the money was going back to our debt. We felt like we were drowning and had no way out. We had thought about doing it [declaring bankruptcy] for a year, but it was so taboo.

Also see: Why are so many people over 55 going bankrupt?

We had to go to a bankruptcy attorney, who filed a petition, and then we had a day in court. It was a day I’ll never forget. Our son was in preschool at the time, and our daughter was still a baby. We had to tell the judge our total debt out loud and I remember hearing someone chuckle in the background. It was eye-opening and humiliating.

How did bankruptcy affect your finances?

We lost our house and cars. We thought it could provide us some relief to move forward, but it didn’t solve all of our issues. You still have to rebound and recuperate. While bankruptcy eliminated our unsecured debt, we still had $125,000 in student loans and had to get two more cars — $22,000 in car loans — since we don’t work near each other. We also had a third child in 2012 and ended up running our credit card back up to $32,000.

What steps did you take to pay off the rest of your debt?

When we were on one income, we cashed out some of my wife’s retirement to help pay off the student loans. [Editor’s note: While it’s tempting to halt retirement savings or pull retirement funds out to speed your debt payoff, NerdWallet recommends against it. Amassing enough for retirement depends heavily on interest and returns compounding over many years.]

We used the debt snowball method. None of our interest rates were astronomical, so we knocked out the smaller loans first. Seeing two or three loans disappear quickly was powerful. We also completed Financial Peace University [Dave Ramsey’s nine-lesson class] in 2014. Any tax returns went to paying off debt.

We cut back on vacationing — only going to Atlanta and Florida to see family — and stopped eating out as much. We also drove older cars. For example, we got a 2003 Honda Pilot, which we kept for eight years. We didn’t care what people thought about what we drove.

What kept you motivated during your debt payoff journey?

We knew we wanted to be debt-free, but the “why” was the real motivation. Looking at the end goal — to start saving for retirement — helped a lot. I couldn’t really dig deep into paying off debt and save for retirement at the same time, and it ate at me knowing that I was missing out on opportunities for compound interest. We knew we’d be able to save more once we were debt-free.

We will teach our kids to only buy things they have money to buy. For their birthdays, we put money in their college funds.

— Rashad Muhammad

What have you learned about navigating debt as a couple?

My wife is the free spirit and I am the nerd; I like spreadsheets and she hates them. We had to understand each other’s strengths and weaknesses.

I’d go to my wife and say, “Hey babe, we’re down to $22,000 in debt, so let’s see how we can get it down to $18,000!” I learned that as the numbers came down, the more reluctant spouse starts to get on board.

Aside from that, it was so important for us to combine finances and make sure we both had equal say. I’ve always made 60% to 70% of our income, but it’s our money.

Read: How wiping out $1.5 trillion in student debt would boost the economy

We will teach our kids to only buy things they have money to buy. For their birthdays, we put money in their college funds. We went on a cruise recently, and our kids were blown away. They’ll remember the cruise when they’re older, but they won’t remember a $15 toy. Experiences, not things, make us happy.

Why did you decide to get a house during your debt payoff period?

When we lost our home from filing for bankruptcy, we knew we wanted to get another one, but we wanted to get it the right way. That meant finding a home we could afford and getting a loan that fit our needs. We bought our home in May 2015, and paused our debt payoff — only paying the minimum — during this period [between October 2014 and May 2015]. We went through Neighborhood Assistance Corporation of America [a homeowner assistance program], which didn’t require a down payment and had low interest rates. We went with a 15-year mortgage.

We didn’t wait until we were debt-free to buy a house. If we had, we would have bought at the top of the market and would probably have paid 20% more for the same house. We have a little more than 10 years to pay it off, but there’s no rush because the interest rate is low.

What would you have done differently?

I would have gone to community college and worked for two years while staying at home. If I could talk to 18-year-old me, I wouldn’t have applied for that first credit card without knowing anything about money — that set me on a road of debt, and the most important piece of building wealth is staying out of debt. I remember buying a set of $49 cellphones that didn’t even work.

What’s your income, and what are your financial goals now that you and your wife are debt-free?

My wife and I are both educators, and we’ve gotten 3% raises almost every year. Our joint salary is around $161,000 now. I also earned around $20,000 from real estate last year.

My goal is to make $50,000 from real estate this year and eventually $100,000 a year. That money goes toward retirement, my kids’ 529 plans, taxes and fun.

We want to retire at the ages of 52 and 54, respectively. We’re holding out until we get our pensions. I’ve been motivated by the FIRE [“financial independence, retire early”] movement.

We’re also going to Cabo for our 15th anniversary and have another cruise booked for the entire family for 2021. We couldn’t do these trips before.

What’s an unexpected benefit of being debt-free?

We were at dinner one day and saw a single mom eating with four kids. My wife and I looked at each other and it clicked — we told the server we’d cover her bill and tip. In the past when we had debt, we’d feel guilty doing something like that. How could we help people when we could barely help ourselves? Doing random acts of kindness wasn’t possible before, but it feels so good to be able to do that now.

How to ditch your own debt

If the Muhammads’ story motivates you to tackle your own debt, here are a few things to consider.

  • Weigh the pros and cons of bankruptcy. Filing for bankruptcy is certainly not for everyone, but it may be a smart option if your amount of debt (excluding a mortgage) exceeds 40% of your income, among other factors.
  • Decide which debt payoff method is right for you. The Muhammads used the debt snowball method, which prioritizes small loans, but the debt avalanche method targets debts with the highest interest rates first.
  • Get out of the comparison trap. Driving an older car (versus buying a brand-new one) helped the Muhammads save over time, but they had to shift their thinking. “We’re in a culture where we glamorize others. We see things and think they’re worth having,” he says.
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Valerie Lai is a writer at NerdWallet. Email:

Kelley Blue Book: These 3 EVs are the lowest cost to own over 5 years

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The 5-Year Cost to Own equation is complex and includes things like insurance, fuel economy and interest rates, although the biggest driver remains depreciation. What your vehicle is worth in resale over the long run will have a big impact on your overall costs. While many vehicles may compare favorably to the competition on initial purchase price, varying rates of depreciation result from not only the individual model’s desirability in the resale market, but also the brand’s reputation.

First place: Nissan Leaf

Predicted 5-year cost to own: $40,186

This latest generation Nissan Leaf put most of the doubts that had plagued previous iterations of Nissan’s NSANY, -7.00% pure-electric small car to rest. With a sleeker exterior shape that deserves a “most improved” prize, a modern interior that’s a pleasure to ride and drive in, and a pricing strategy that’s very competitive, the Nissan Leaf takes home KBB’s Best Electric Vehicle 5-Year Cost to Own Award for the third year in a row.

The Leaf’s heritage qualifications are summed up succinctly in our Expert Review: “Electric cars are all the rage these days, but while Hyundai, HYMTF, +19.63% Kia, and Chevrolet are relatively new to the game, the 2020 Nissan Leaf electric marks its 10th year of production. Only Tesla has a longer history of producing a cost-effective, mass-produced electric car.”

Starting at $32,525 for 2020 (including a $925 destination charge), the base-style Leaf is the only electric in this class can still get you near the $25,000 mark after you take advantage of the $7,500 federal tax credit. That Leaf, good for 150 miles on a full charge includes keyless entry, an 8-inch touchscreen, and (applause) Apple AAPL, -7.90% CarPlay and Android Auto.

Also see: Which is better, a Corolla or a Civic? We compare the 2020 models

Nissan’s Safety Shield 360 bundles a reassuring set of safety features that includes automatic emergency braking with pedestrian detection, blind-spot monitoring, and forward-collision warning. It comes standard, as does e-Pedal, where you just take your foot off the throttle pedal for efficient, battery-charging braking all the way to a complete stop.

If you need more range in your Leaf, the Leaf Plus models, starting at $38,200, deliver 226 miles — more than enough to make it your home-based daily driver, as long as you install a 240-volt Level 2 charger — and one more way that an electric car contributes to low-costs daily ownership.

Second place: 2020 Chevrolet Bolt EV

Predicted 5-year cost to own: $42,417

The Chevy Bolt


Stretching to a best-in-class 259 miles of range for 2020, the Chevy Bolt EV offers surprising quiet and driving civility for such a small car. Learn more about the Bolt EV.

Also on MarketWatch: 8 affordable new cars that get at least 40 mpg

Third place: 2020 Hyundai Kona Electric

Predicted 5-year cost to own: $44,910

The Hyundai Kona


With 258 miles of pure-electric range and the best powertrain warranty in the business, the safety-laden Kona Electric is one of the smartest EV buys you can make.

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