Personal Finance | featured news

I will never forget the moment that my soon-to-be ex-husband and I sat in our mediator’s office as he illustrated our finances on a chalkboard. “There really aren’t any assets,” he told us. But there was $4 million of debt—from bad investments, lawsuits and failed business deals that I knew nothing about.

No one likes paying legal fees, but tax deductions can make them a lot less painful. With a 40% tax rate, $10,000 in deductible legal fees costs you only $6,000. But if your legal fees are to get divorced or because a family member sues you for slander, the legal fees are purely personal and non-deductible. See How To Make Divorce Less Taxing. Distinguish purely personal expenses from investment expenses.

My husband and I recently refinanced our mortgage, and the bank sent us our credit scores during the process. Both scores were good, but my husband’s was 30 points higher than mine. This puzzled me, because we share the same spending and bill-payment practices.

In a recent blog post, my colleague, Nancy Anderson, writes about “Three Common Estate Planning Mistakes That You Can Easily Avoid.” It’s not surprising that these mistakes are so common since in my experience, estate planning is the area with the most widespread confusion and unfortunately, this confusion can lead to those very mistakes, costing so much in time, money, and stress to people’s families.

It costs a lot more to get free checking as banks significantly have boosted the average required minimum balance this year to $723, according to data released Monday by Bankrate.com.

How is your portfolio doing since the 2008 financial crisis? If you’re like most Americans, it’s probably healed some. After all, stocks are up about 13 percent since October 2008. Bonds are up about 30 percent. “Winnie-the-Pooh” is doing a bit better. A 1926 first-edition copy of the fabled children’s classic can fetch nearly four times what it did in 2008 — a return of almost 300 percent.

A two-income American family with an average income that dutifully invests in a 401(k) plan using typical strategies will lose $155,000 – or about 30 percent of what they should have saved for retirement -- to Wall Street fees, according to a study by an economic justice advocacy organization.

A couple of weeks ago, I responded to a couple of questions about paying off your mortgage early. This week, I got the opposite question. Given record low mortgage rates, does it even make sense to ever pay off your mortgage at all?

You can get bad tax advice or no tax advice in just about any area of life, but from my reading of tax cases and some personal observations, I think that if you want to get really bad tax advice, you should get divorced.

I don’t know whether I will be among the winners of tonight’s Mega Millions lottery—the chances are extremely low, but I do have a simple investment advise for the winner (s): DON’T PAY SOMEONE TO LOSE YOU MONEY!