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If our net worth were displayed on our foreheads for all to see, libraries would be mobbed and used cars would be status symbols.

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Taking It With You

DEEP DOWN INSIDE, I want to be the richest person in the graveyard.  I retired at age 62, confident in our financial plan to survive market fluctuations. We saved over 25% of our income for nearly three decades. Perhaps a bit too much, but we lived well and always had sufficient funds to raise a family, maintain our household, and put our children through postgraduate education. If anything, our retirement spending level is conservative, based on a 40 year time frame for both my wife and I. We have a slightly nuanced financial plan. Suffice to say it is reassuring to know that we are beyond financial security if we simply maintain an inflation adjusted 4% withdrawal rate. Indeed, calculations suggested we could double our pre-retirement budget, with no worries or loss of sleep. Risk be damned! Slowly, we made a conscious decision to spend more. At first it was tough to break old habits. I mean, frugality runs deep in my immediate family. You could use my brother and I as chromosomal templates in a genetic search to discover the frugality gene.  My wife and I now go out for coffee without blinking an eye at paying nearly 6 bucks for a cup of Joe (plus tip). We don’t hesitate to escape the Houston heat by scarfing 5 dollar a scoop ice cream. We no longer plan our restaurant outings according to Happy Hour schedules or local senior discounts.  Even so, three years into retirement, our annual spending remains well below what our financial plan says we can safely afford.  Time to up the ante. We bought season tickets to the symphony and added a dinner date before the performance. We took international vacations twice a year, exploring new countries and cultures. We drove to national parks and treated ourselves to overnights in hotels instead of motels. We gifted our children, with hopes they would bolster their own long-term savings. Gosh, we even made significant charitable gifts to institutions we only previously dreamed of supporting.  Spending is easy. Spending wisely is a challenge. Ironically, the strong stock market since our retirement has made it remarkably difficult to spend our money as initially planned. It sounds counter intuitive, but let me explain.  Our retirement portfolio allocation has a stock to bond ratio of 75:25.  The stock component primarily matches total market returns. Specifically, our stock component has grown more than 65% since we retired. Because of this, we put aside 10 years of safer funds (bonds and cash equivalents) to weather any potential market storm. We successfully navigated the immediate sequence of return risk (SORR) hurdle, that pesky danger of facing a poor investment market performance in earliest years of retirement.  We feel both blessed and safe. We sleep well at night. Our financial calculators now indicate that we can spend even more than original predictions. Yet that realization is causing me angst. After all, we spent a lifetime saving, scrimping and sacrificing to reach this point. Indeed, we value the concepts of avoiding excess, of seeking value and purpose in purchases. Our goals were never to impress the neighbors, but rather be content and grateful with what we have.   I want people to know I had a choice about how I spent my accumulated dollars. I chose a life of frugality, questioning everything I purchased. Do I really need that new phone? My current one makes calls, surfs the web, and navigates when I need directions.  Do I need a new car? My dented 11 year old Honda gets me safely to my destinations. Shall I purchase the kayak I’ve been eyeing, or simply rent one for the two times a year I brave the waters?  Perhaps the real measure of a successful retirement is not how much money remains at the end, but whether those resources were used in ways that enriched the lives of others and brought meaning to our own. Financial independence now gives us choices, and a freedom after decades of disciplined saving. It is okay if I leave this world with more than enough funds still in the bank. There are values I learned along the way; those of prudence, generosity, gratitude, and the quiet confidence that comes from living well below one's means. In the end, wealth is simply a tool; character is the true legacy. Perhaps the goal isn't to die with the largest portfolio, but to know that every dollar reflected the values by which we chose to live. Therefore, if I can’t spend it all according to my values, I guess I’m okay with being the one of the richest men in the graveyard.  Jeffrey K. Actor, PhD, was a professor at a major medical school in Houston for more than 25 years, serving as an academic researcher with interests in how immune responses function to fight pathogenic diseases. Jeff’s retirement goals are to write short science fiction stories, volunteer in the community and spend time in his garden. Check out his earlier articles.
Read more »

The Economy of Expectations

"Or perhaps follow social media that sets a better example. Anyone got any suggestions?"
- DAN SMITH
Read more »

Locking it in

"….there are lots of ways to achieve a good financial base, and following the textbook probably isn’t required if you find something else that works for you. General George Patton once said “A good plan, violently executed now, is better than a perfect plan next week." Leave out the violently executed part and I think his quote supports your point. My take away is that a good plan implemented now is usually better than a perfect one later. Sometimes later never comes. "
- DAN SMITH
Read more »

The Intentional Spendthrift

"Mark, I spent a week and a half in Portugal in May. Spent time in Lisbon and Porto and Braga (for a wedding). Fantastic time! Most time was spent in larger cities including 5 prepaid excursions. My wife and I definitely followed the “spend freely and enjoy the trip” mind set. Did you happen to visit the westernmost point on the European continent?"
- Andy Morrison
Read more »

Behind The Finery

"Thanks Mark. I had a slightly different take. If I go out for some form of entertainment, I would usually expect the whole event to be less than $100. But when just the deposit is $100, that's well out of my league!"
- greg_j_tomamichel
Read more »

State Farm Dividend

"Lucky for you that StF provides good service. After they challenged a simple $275 auto glass claim on a rental car, I wholly disagree. For anyone living in CA, they will not write any new home, renters, or umbrella policies. Note that StF has significantly changed their sales rep compensation model, favoring those reps who grow their biz and punishing reps who do not. Expect a shaking out period by longtime reps."
- Scott Dailey
Read more »

Make the Attic Great Again

"Nearing your 80s and a new Z in the garage; you rock, John!"
- DAN SMITH
Read more »

Traditional or Roth

THE CHOICE BETWEEN a traditional retirement account or a Roth is a frequent topic on HumbleDollar. The choice is generally framed as a choice between paying taxes up front (a Roth), or deferring taxes until withdrawal (traditional). I thought it would be interesting to evaluate a real-life example of how this choice might work out. In December of 2016 my wife and I had an opportunity to each open a Roth IRA. My wife took a partial sabbatical that year, and that, combined with maxing out our 401k accounts, gave us a chance to each open a $4,500 Roth IRA. The maximum allowable contribution that year was $6,500 for those 50 and over. Up until then we had assumed that our marginal tax bracket would likely be lower in retirement, and focused on contributing to our employer’s traditional 401k plans. Despite that, we decided to move forward with opening a Roth IRA. I thought it would give us some tax diversity, and the opportunity to do Roth conversions when, and if, it made sense in the future.  In December of 2016 we opened Roth IRAs at Vanguard and invested the $4,500 in their S&P 500 Index Fund. Those initial funds have been invested for almost 10 years. Over that decade we have added some additional funds, and have done a few conversions. I recently did a quick analysis to see how my Roth experience would have compared to investing in a traditional IRA.   In 2016, our marginal tax bracket was 28%.  To contribute the $4,500 required $6,250 of pre-tax income. Due to some financial engineering over the last year, including selling our second home in late 2025, I expect our 2026 marginal tax bracket to stay within the 12% bracket. I’ve been looking at this closely because I’m considering doing a Roth conversion later this year. The table below shows the comparison between the Roth performance, and what a traditional IRA would have produced. The annual rate of return was determined using Nick Maggiulli’s S&P 500 Historical Return Calculator. Roth vs Traditional The table shows that the Traditional IRA would have been the better choice, producing about $3,500 more in available funds, or about 22% more. This demonstrates that the primary driver in choosing between a Roth and a traditional qualified account is a consideration of the tax rates at the time of contribution and at the time of distribution. There have been a number of changes to the tax code in the last decade that have contributed to the result, but I certainly didn’t predict any of them.  If you guess wrong, you pay the price in a higher tax bill. In the example above, the extra $1,750 invested in the traditional account produced an additional $6,143.31 in earnings. The lower tax rate at the distribution of the traditional IRA results in the $3,500 in extra funds. Even though the Roth IRA had tax free earnings growth, the initial larger tax rate overcame that advantage, when compared to the traditional IRA.   Because of my pension and my wife’s social security benefit, 85% of her social security benefit is taxable income, so that is not a consideration in our tax calculation. I used Dinkytown’s 1040 Calculator to run a series of estimates of our 2026 tax return to assess if we want to execute a Roth Conversion this year. We are still 4 years from taking RMDs, and I will start my Social Security in a year when I turn 70. My current thinking is a conversion of about $40,000 will keep us in the 12% bracket. There would also be a small NJ state tax impact. My simple analysis reinforces what I’ve been taught. Roth contributions make the most sense when you think your current tax bracket is lower than when you expect to withdrawal the funds. There are secondary considerations, like no tax diversification, no RMDs, and uncertainty about future tax rates. If you intend to pass the funds to heirs, it might make sense to perform Roth conversions today at the 22% tax bracket if you intend to pass these accounts to heirs who may be in their peak earnings years. Not sure? I believe I recall several HumbleDollar contributors write something about splitting the difference?   Richard Connor is a semi-retired aerospace engineer with a keen interest in finance. He enjoys a wide variety of other interests, including chasing grandkids, space, sports, travel, winemaking and reading. Follow Rick on Twitter @RConnor609 and check out his earlier articles.
Read more »

Financial Fraud

RECENTLY, A FELLOW—let’s call him Tom—contacted me with a distressing story of financial fraud. I’ll describe what happened then review steps you might take to prevent this same sort of thing. Tom first noticed there might be a problem when he spotted a larger-than-average withdrawal from his checking account. The payee was a 529 college savings plan. But because Tom and his wife—let’s call her Jane—have 529 accounts for their children, the transaction almost went unnoticed. Tom assumed it was a transfer into his own family’s account. But when he mentioned it to Jane, she noted that they had stopped contributing to their 529. That prompted them to investigate further. What they found was that scammers had set up a new 529 account in Tom’s name. They then initiated an electronic funds transfer to move more than $2,000 from Tom and Jane’s checking account into the new 529 set up by the thieves. The intention presumably was to then withdraw the funds from the 529, at which point the theft would become unrecoverable. How were the thieves able to initiate the transfer from Tom and Jane’s bank? This is the part that’s distressing: They took advantage of the widely-used Automated Clearing House (ACH) system. Unfortunately, this system has key weaknesses that make it susceptible to fraud like this. First, it allows funds to be “pulled” out of an account. That’s in contrast to a wire transfer, which can only be “pushed” out by someone with access to the account. So a thief would only need your name, account number and bank routing number to siphon funds from that account. And unfortunately, that information is printed on the front of every check, making it accessible to someone looking to perpetrate this type of scheme. Once the thief had the new 529 account set up in Tom’s name, it was just one simple step to initiate a transfer from Tom and Jane’s bank since the accountholder’s name was the same on both accounts. It was so seamless that if Tom hadn’t been reviewing the transactions in his account, he might never have noticed the theft. According to the FBI, losses due to cybercrime have increased from $1 billion per year to $21 billion over the past 10 years, and ACH theft is a tactic thieves are using more frequently, so it’s worth looking at strategies to help keep your accounts secure. Here are six recommendations.
  1. Secure the login to your bank account by setting up two-factor authentication. And if your bank supports it, use an authenticator app, rather than text messages, for the authentication codes. Ideally, if your bank supports it, switch to a passkey. This is a newer technology that represents a significant advance over traditional passwords. Most importantly, they aren’t vulnerable to phishing attacks. They’re also easier to use, providing one-click logins, and you can store passkeys in a password manager. For those reasons, more websites are beginning to support passkeys. I’d make the switch as soon as your bank makes them available.
  2. Set up alerts through your bank to monitor activity in your checking account. Every bank is different, but most allow you to set up email- or text-based alerts to let you know when transactions above a specified threshold are processed, or when other types of activity occur.
  3. Monitor your transactions. These days, it can be hard to keep an eye on every account. Households often have one or more bank accounts plus credit cards and electronic payment services like Venmo or Zelle. Most people realistically don’t have the time to review every account in real time. That’s why I recommend a service like Monarch or YNAB, which are web-based versions of traditional budgeting tools like Quicken. These services can pull in transactions from all your accounts and present them in a consolidated list, making review much easier. If you kept Monarch or YNAB open in a browser window on your home computer, you could scroll through recent transactions whenever you have a spare minute.
  4. To narrow the circle of people who have access to your account information, try limiting the number of paper checks you write. Especially with Zelle and Venmo as alternatives for making payments, this is getting easier. If you do write paper checks, be sure to use a gel pen and to avoid freestanding mailboxes. Those steps can help prevent a related type of fraud, as Jonathan Clements explained a few years back.
  5. Pay attention to notifications of data breaches. Unfortunately, breach announcements seem to occur so frequently that we’ve become immune to them. It’s worth paying attention, though, to understand which particular pieces of information have been stolen. If it looks like your banking information is included in a breach, it might be worth opening a new account, inconvenient as that would be.
  6. Have your guard up against unsolicited phone calls, emails or text messages. If someone is contacting you about an “account security issue,” or claims to be calling from your bank or from the IRS, be especially wary. Those are common tactics for creating a sense of urgency that can cause people to let their guard down.
What if, like Tom and Jane, you spot a fraudulent transaction in your account? Then it’s important to report it as quickly as possible. Regulation E can limit your liability, but the faster you report a suspicious transaction, the more protection it provides. Liability is limited to just $50 if a theft is reported within two business days, but that exposure increases to $500 if it’s reported later. And after 60 days, there are no guarantees. Thieves, unfortunately, don’t seem to sleep, which means that we need to be more vigilant than in the past, and need to be continuously vigilant. As personal finance author Mike Piper wrote recently, “Cybersecurity should be considered another core area of personal finance—no different from insurance planning, for instance.” Adam M. Grossman is the founder of Mayport, a fixed-fee wealth management firm. Sign up for Adam's Daily Ideas email, follow him on X @AdamMGrossman and check out his earlier articles.
Read more »

A bleak picture for retirement in the future?

"To me, it is only bleak, if you do not prepare. You make choices, and most people live for today, not when they are 65 to 90 years old in retirement. That may work for some, but for most not so much."
- William Dorner
Read more »

The best state to retire? Take a close look.

"Iowa has no tax on any retirement income, social security, pension, IRA, 401k, etc. That's great, but then comes the post RMD years and those withdrawals I don't spend begin to earn funds subject to Iowa income taxes, a flat rate of 3.8%. They more than make up for the retiree income with a higher property tax, 1.33% versus the US median of 0.99%."
- Mark Eckman
Read more »

Percentage that “age in place”

"As you mentioned, we had to provide a lot of financials for our CCRC. Besides our IRA’s, I have a pension with survivor benefits and we each have social security. Besides that, we each have Long Term Care insurance. Outside of our monthly fees, the insurance , since we are in our mid-70’s, is our largest monthly expense. Our CCRC is non profit and the contract states their intention to provide lifelong care. We decided to do a non refundable entrance fee. But we do get a discount on our charges if we need the medical services of the CCRC"
- BillWCP
Read more »

Taking It With You

DEEP DOWN INSIDE, I want to be the richest person in the graveyard.  I retired at age 62, confident in our financial plan to survive market fluctuations. We saved over 25% of our income for nearly three decades. Perhaps a bit too much, but we lived well and always had sufficient funds to raise a family, maintain our household, and put our children through postgraduate education. If anything, our retirement spending level is conservative, based on a 40 year time frame for both my wife and I. We have a slightly nuanced financial plan. Suffice to say it is reassuring to know that we are beyond financial security if we simply maintain an inflation adjusted 4% withdrawal rate. Indeed, calculations suggested we could double our pre-retirement budget, with no worries or loss of sleep. Risk be damned! Slowly, we made a conscious decision to spend more. At first it was tough to break old habits. I mean, frugality runs deep in my immediate family. You could use my brother and I as chromosomal templates in a genetic search to discover the frugality gene.  My wife and I now go out for coffee without blinking an eye at paying nearly 6 bucks for a cup of Joe (plus tip). We don’t hesitate to escape the Houston heat by scarfing 5 dollar a scoop ice cream. We no longer plan our restaurant outings according to Happy Hour schedules or local senior discounts.  Even so, three years into retirement, our annual spending remains well below what our financial plan says we can safely afford.  Time to up the ante. We bought season tickets to the symphony and added a dinner date before the performance. We took international vacations twice a year, exploring new countries and cultures. We drove to national parks and treated ourselves to overnights in hotels instead of motels. We gifted our children, with hopes they would bolster their own long-term savings. Gosh, we even made significant charitable gifts to institutions we only previously dreamed of supporting.  Spending is easy. Spending wisely is a challenge. Ironically, the strong stock market since our retirement has made it remarkably difficult to spend our money as initially planned. It sounds counter intuitive, but let me explain.  Our retirement portfolio allocation has a stock to bond ratio of 75:25.  The stock component primarily matches total market returns. Specifically, our stock component has grown more than 65% since we retired. Because of this, we put aside 10 years of safer funds (bonds and cash equivalents) to weather any potential market storm. We successfully navigated the immediate sequence of return risk (SORR) hurdle, that pesky danger of facing a poor investment market performance in earliest years of retirement.  We feel both blessed and safe. We sleep well at night. Our financial calculators now indicate that we can spend even more than original predictions. Yet that realization is causing me angst. After all, we spent a lifetime saving, scrimping and sacrificing to reach this point. Indeed, we value the concepts of avoiding excess, of seeking value and purpose in purchases. Our goals were never to impress the neighbors, but rather be content and grateful with what we have.   I want people to know I had a choice about how I spent my accumulated dollars. I chose a life of frugality, questioning everything I purchased. Do I really need that new phone? My current one makes calls, surfs the web, and navigates when I need directions.  Do I need a new car? My dented 11 year old Honda gets me safely to my destinations. Shall I purchase the kayak I’ve been eyeing, or simply rent one for the two times a year I brave the waters?  Perhaps the real measure of a successful retirement is not how much money remains at the end, but whether those resources were used in ways that enriched the lives of others and brought meaning to our own. Financial independence now gives us choices, and a freedom after decades of disciplined saving. It is okay if I leave this world with more than enough funds still in the bank. There are values I learned along the way; those of prudence, generosity, gratitude, and the quiet confidence that comes from living well below one's means. In the end, wealth is simply a tool; character is the true legacy. Perhaps the goal isn't to die with the largest portfolio, but to know that every dollar reflected the values by which we chose to live. Therefore, if I can’t spend it all according to my values, I guess I’m okay with being the one of the richest men in the graveyard.  Jeffrey K. Actor, PhD, was a professor at a major medical school in Houston for more than 25 years, serving as an academic researcher with interests in how immune responses function to fight pathogenic diseases. Jeff’s retirement goals are to write short science fiction stories, volunteer in the community and spend time in his garden. Check out his earlier articles.
Read more »

The Economy of Expectations

"Or perhaps follow social media that sets a better example. Anyone got any suggestions?"
- DAN SMITH
Read more »

Locking it in

"….there are lots of ways to achieve a good financial base, and following the textbook probably isn’t required if you find something else that works for you. General George Patton once said “A good plan, violently executed now, is better than a perfect plan next week." Leave out the violently executed part and I think his quote supports your point. My take away is that a good plan implemented now is usually better than a perfect one later. Sometimes later never comes. "
- DAN SMITH
Read more »

The Intentional Spendthrift

"Mark, I spent a week and a half in Portugal in May. Spent time in Lisbon and Porto and Braga (for a wedding). Fantastic time! Most time was spent in larger cities including 5 prepaid excursions. My wife and I definitely followed the “spend freely and enjoy the trip” mind set. Did you happen to visit the westernmost point on the European continent?"
- Andy Morrison
Read more »

Behind The Finery

"Thanks Mark. I had a slightly different take. If I go out for some form of entertainment, I would usually expect the whole event to be less than $100. But when just the deposit is $100, that's well out of my league!"
- greg_j_tomamichel
Read more »

State Farm Dividend

"Lucky for you that StF provides good service. After they challenged a simple $275 auto glass claim on a rental car, I wholly disagree. For anyone living in CA, they will not write any new home, renters, or umbrella policies. Note that StF has significantly changed their sales rep compensation model, favoring those reps who grow their biz and punishing reps who do not. Expect a shaking out period by longtime reps."
- Scott Dailey
Read more »

Make the Attic Great Again

"Nearing your 80s and a new Z in the garage; you rock, John!"
- DAN SMITH
Read more »

Traditional or Roth

THE CHOICE BETWEEN a traditional retirement account or a Roth is a frequent topic on HumbleDollar. The choice is generally framed as a choice between paying taxes up front (a Roth), or deferring taxes until withdrawal (traditional). I thought it would be interesting to evaluate a real-life example of how this choice might work out. In December of 2016 my wife and I had an opportunity to each open a Roth IRA. My wife took a partial sabbatical that year, and that, combined with maxing out our 401k accounts, gave us a chance to each open a $4,500 Roth IRA. The maximum allowable contribution that year was $6,500 for those 50 and over. Up until then we had assumed that our marginal tax bracket would likely be lower in retirement, and focused on contributing to our employer’s traditional 401k plans. Despite that, we decided to move forward with opening a Roth IRA. I thought it would give us some tax diversity, and the opportunity to do Roth conversions when, and if, it made sense in the future.  In December of 2016 we opened Roth IRAs at Vanguard and invested the $4,500 in their S&P 500 Index Fund. Those initial funds have been invested for almost 10 years. Over that decade we have added some additional funds, and have done a few conversions. I recently did a quick analysis to see how my Roth experience would have compared to investing in a traditional IRA.   In 2016, our marginal tax bracket was 28%.  To contribute the $4,500 required $6,250 of pre-tax income. Due to some financial engineering over the last year, including selling our second home in late 2025, I expect our 2026 marginal tax bracket to stay within the 12% bracket. I’ve been looking at this closely because I’m considering doing a Roth conversion later this year. The table below shows the comparison between the Roth performance, and what a traditional IRA would have produced. The annual rate of return was determined using Nick Maggiulli’s S&P 500 Historical Return Calculator. Roth vs Traditional The table shows that the Traditional IRA would have been the better choice, producing about $3,500 more in available funds, or about 22% more. This demonstrates that the primary driver in choosing between a Roth and a traditional qualified account is a consideration of the tax rates at the time of contribution and at the time of distribution. There have been a number of changes to the tax code in the last decade that have contributed to the result, but I certainly didn’t predict any of them.  If you guess wrong, you pay the price in a higher tax bill. In the example above, the extra $1,750 invested in the traditional account produced an additional $6,143.31 in earnings. The lower tax rate at the distribution of the traditional IRA results in the $3,500 in extra funds. Even though the Roth IRA had tax free earnings growth, the initial larger tax rate overcame that advantage, when compared to the traditional IRA.   Because of my pension and my wife’s social security benefit, 85% of her social security benefit is taxable income, so that is not a consideration in our tax calculation. I used Dinkytown’s 1040 Calculator to run a series of estimates of our 2026 tax return to assess if we want to execute a Roth Conversion this year. We are still 4 years from taking RMDs, and I will start my Social Security in a year when I turn 70. My current thinking is a conversion of about $40,000 will keep us in the 12% bracket. There would also be a small NJ state tax impact. My simple analysis reinforces what I’ve been taught. Roth contributions make the most sense when you think your current tax bracket is lower than when you expect to withdrawal the funds. There are secondary considerations, like no tax diversification, no RMDs, and uncertainty about future tax rates. If you intend to pass the funds to heirs, it might make sense to perform Roth conversions today at the 22% tax bracket if you intend to pass these accounts to heirs who may be in their peak earnings years. Not sure? I believe I recall several HumbleDollar contributors write something about splitting the difference?   Richard Connor is a semi-retired aerospace engineer with a keen interest in finance. He enjoys a wide variety of other interests, including chasing grandkids, space, sports, travel, winemaking and reading. Follow Rick on Twitter @RConnor609 and check out his earlier articles.
Read more »

Financial Fraud

RECENTLY, A FELLOW—let’s call him Tom—contacted me with a distressing story of financial fraud. I’ll describe what happened then review steps you might take to prevent this same sort of thing. Tom first noticed there might be a problem when he spotted a larger-than-average withdrawal from his checking account. The payee was a 529 college savings plan. But because Tom and his wife—let’s call her Jane—have 529 accounts for their children, the transaction almost went unnoticed. Tom assumed it was a transfer into his own family’s account. But when he mentioned it to Jane, she noted that they had stopped contributing to their 529. That prompted them to investigate further. What they found was that scammers had set up a new 529 account in Tom’s name. They then initiated an electronic funds transfer to move more than $2,000 from Tom and Jane’s checking account into the new 529 set up by the thieves. The intention presumably was to then withdraw the funds from the 529, at which point the theft would become unrecoverable. How were the thieves able to initiate the transfer from Tom and Jane’s bank? This is the part that’s distressing: They took advantage of the widely-used Automated Clearing House (ACH) system. Unfortunately, this system has key weaknesses that make it susceptible to fraud like this. First, it allows funds to be “pulled” out of an account. That’s in contrast to a wire transfer, which can only be “pushed” out by someone with access to the account. So a thief would only need your name, account number and bank routing number to siphon funds from that account. And unfortunately, that information is printed on the front of every check, making it accessible to someone looking to perpetrate this type of scheme. Once the thief had the new 529 account set up in Tom’s name, it was just one simple step to initiate a transfer from Tom and Jane’s bank since the accountholder’s name was the same on both accounts. It was so seamless that if Tom hadn’t been reviewing the transactions in his account, he might never have noticed the theft. According to the FBI, losses due to cybercrime have increased from $1 billion per year to $21 billion over the past 10 years, and ACH theft is a tactic thieves are using more frequently, so it’s worth looking at strategies to help keep your accounts secure. Here are six recommendations.
  1. Secure the login to your bank account by setting up two-factor authentication. And if your bank supports it, use an authenticator app, rather than text messages, for the authentication codes. Ideally, if your bank supports it, switch to a passkey. This is a newer technology that represents a significant advance over traditional passwords. Most importantly, they aren’t vulnerable to phishing attacks. They’re also easier to use, providing one-click logins, and you can store passkeys in a password manager. For those reasons, more websites are beginning to support passkeys. I’d make the switch as soon as your bank makes them available.
  2. Set up alerts through your bank to monitor activity in your checking account. Every bank is different, but most allow you to set up email- or text-based alerts to let you know when transactions above a specified threshold are processed, or when other types of activity occur.
  3. Monitor your transactions. These days, it can be hard to keep an eye on every account. Households often have one or more bank accounts plus credit cards and electronic payment services like Venmo or Zelle. Most people realistically don’t have the time to review every account in real time. That’s why I recommend a service like Monarch or YNAB, which are web-based versions of traditional budgeting tools like Quicken. These services can pull in transactions from all your accounts and present them in a consolidated list, making review much easier. If you kept Monarch or YNAB open in a browser window on your home computer, you could scroll through recent transactions whenever you have a spare minute.
  4. To narrow the circle of people who have access to your account information, try limiting the number of paper checks you write. Especially with Zelle and Venmo as alternatives for making payments, this is getting easier. If you do write paper checks, be sure to use a gel pen and to avoid freestanding mailboxes. Those steps can help prevent a related type of fraud, as Jonathan Clements explained a few years back.
  5. Pay attention to notifications of data breaches. Unfortunately, breach announcements seem to occur so frequently that we’ve become immune to them. It’s worth paying attention, though, to understand which particular pieces of information have been stolen. If it looks like your banking information is included in a breach, it might be worth opening a new account, inconvenient as that would be.
  6. Have your guard up against unsolicited phone calls, emails or text messages. If someone is contacting you about an “account security issue,” or claims to be calling from your bank or from the IRS, be especially wary. Those are common tactics for creating a sense of urgency that can cause people to let their guard down.
What if, like Tom and Jane, you spot a fraudulent transaction in your account? Then it’s important to report it as quickly as possible. Regulation E can limit your liability, but the faster you report a suspicious transaction, the more protection it provides. Liability is limited to just $50 if a theft is reported within two business days, but that exposure increases to $500 if it’s reported later. And after 60 days, there are no guarantees. Thieves, unfortunately, don’t seem to sleep, which means that we need to be more vigilant than in the past, and need to be continuously vigilant. As personal finance author Mike Piper wrote recently, “Cybersecurity should be considered another core area of personal finance—no different from insurance planning, for instance.” Adam M. Grossman is the founder of Mayport, a fixed-fee wealth management firm. Sign up for Adam's Daily Ideas email, follow him on X @AdamMGrossman and check out his earlier articles.
Read more »

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Get Educated

Manifesto

NO. 9: WE SPEND too much time fretting over our investments—where there’s limited room to add value—and too little on other financial issues, like taxes, insurance and estate planning.

act

HAVE A FAMILY talk about college. How much financial help can you give your children? If they’ll need to shoulder part of the cost, tell them long before they start eyeing colleges. What career do your teenagers plan to pursue? If they’ll likely end up with a modest income, counsel them against colleges that will require taking on hefty student loans.

think

END-OF-HISTORY illusion. This is the belief that we’ve changed significantly in the past—in terms of things like our values, our personality, and the food and music we like—but we won’t change much going forward. This belief can make us resistant to change. It also means our choices today may backfire, because our future self may have different likes and dislikes.

Truths

NO. 98: INSURANCE companies typically pay out less in claims than they receive in premiums. Result: For most buyers, insurance will be a money loser—which is what you want, because it's a sign that life is good. But because it’s a money loser, you should only insure against major financial risks, while committing to cover smaller losses out of your own pocket.

Financial life planner

Manifesto

NO. 9: WE SPEND too much time fretting over our investments—where there’s limited room to add value—and too little on other financial issues, like taxes, insurance and estate planning.

Spotlight: Careers

Man vs. Machine

COULD HUMBLEDOLLAR be replaced by a website chock-full of articles created using artificial intelligence? The short answer: It would be remarkably easy—and I fear readers wouldn’t object, especially if they didn’t know how the articles were generated.
To show what’s possible, I requested eight personal-finance articles from three freely available artificial intelligence (AI) tools, ChatGPT, Google’s Gemini and Microsoft’s Copilot. The first of those articles is published today, with the other seven appearing over the next four days.

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A Crisis of Competence?

Do you think we are moving toward a competency crisis in this country? I told this story in a comment on an article a few months back:
“Seven years ago, I bought a 2005 Outback. Despite the pink slip being clearly written by the dealer, the title came back with ‘Culter’ as my last name. I went to AAA for advice and they filled out a correction form for me. The title was revised to read ‘Renneth Culter’.

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Am I Retired?

I retired from a 38-year engineering career with a large electric power generation company on September 5, 2023. On September 11, 2023, I began an encore career—part time, on-call—with a small engineering firm. In the winter, I worked very few hours. Some weeks I only logged a single hour. I felt like a retiree and started to self-identify as one. As we moved into spring, more contracts came in and I started working more hours. For the past several months,

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Going Back to Work (Briefly)

I’ve read with interest posts such as Jonathan’s Taking Center Stage and Those Who Follow, both which touched on the pluses and minuses of taking on a part-time job in retirement. The conversation in the comments for both of those posts was great, too. Below, I share my own recent experience of re-entering the job world at age 64.
In my past HD posts I have written how, in our mid-60s, my husband and I appeared to be gliding into retirement.

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Requiem for a CEO

A former CEO of my old company passed away this week at age 89. Of the half-dozen or so company CEOs that passed through during my tenure, Joe had made the biggest impression on me. Of course, I was way down the food chain so my interactions with him were limited.
My first encounter with him was as a newly hired engineer for the Philadelphia Electric Company. The company had a program in which engineers were exposed to different divisions of the company during their first year.

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Selling our business – contemplating what’s next

So, we have signed the contracts. We have advised all our staff. We are talking to our customers every day about the sale, about the new owners and how it will be “business as usual”, how they can expect the same service that they have been used to.
We have already received lots of really positive and quite humbling feedback from our customers. Even those that could be challenging at times have been really generous in their praise and thanks.

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Spotlight: Marsh

Why Wait?

Several months ago, I wrote of my wife's and my decision to simplify our financial lives by reducing our investments to the bare minimum. Our thinking is in the same vein as our editor's, and a number of others in the HumbleDollar community, judging from my recollection of reader comments. Now, I know that many others have a different opinion of where to place their money, and that's okay. I'm not implying they're wrong. Indeed, I freely admit that I don't know the future, and time may show that their decision is justified. But, given the uncertainties of life, of our health and mental capacity as we age, is the chance of a little more gain worth the risk of greater loss from the gradual erosion of our ability to nimbly manage a complex portfolio? And what of the present? An interest in investing is, perhaps, the thickest common thread that brings us together here. It's an intensely interesting hobby for many of us. But with time ticking progressively faster, is it a habit that keeps us from other pursuits that may bring more happiness? We each have our own answer to that question, but aside from taxes and similar good reasons for keeping the complexities in place, why wait to embrace simplicity?    
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A Bit More Humble

I LOVE TO PLAN. My wife, Sharon, often catches me nestled in my chair, gazing out a window at a distant object as my mind wanders even farther afield. My musings become scribbles on a scrap of paper, destined for discussion with Sharon at length over coffee and long walks. Eventually, we hammer out the settled strategies we think will best bring us happiness in adventures ranging from our next hike to the next few decades of life. Of course, I know our intended track, or even the final destination, may change over time. I'm just a little boat on a big sea, blown about by winds and carried along by deep currents that may push me far off my charted course. Still, though it may be somewhat of an illusion, I cling to the comfort of control. Smooth sailing. And for most of 2025, life was comfortable. In April, I shifted to part-time work as a physical therapist. I termed my new lifestyle “semi-retirement”. My reduced salary, added to Sharon’s contribution from a few hours’ work each month, still gave us enough income from our jobs to cover expenses, with leftovers for a little investing and so forth. Along with that, we gained enough new-found, free time to pursue a bit more fun while catching up on projects around the house. As an added bonus, I expected delaying full retirement a couple of years might lead to more happiness in the decades ahead. How so? Because my post-retirement plan was still a work-in-progress. “I studied and planned for two years before I retired,” Mike told me at a large family gathering. In his mid-70s, his excitement was evident as he recounted his active lifestyle. At home, his schedule includes participation in our state’s Master Gardener program and regular trips…
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Take a Seat

MILESTONES MARK the growth of a child as she moves from infancy through school age. In similar fashion, we adults tend to measure our life’s progress with “firsts” or other significant events. Perhaps we remember the feeling of maturity that came with our first kiss or our first job. Milestones help us attach meaning to the course of a life that sometimes seems beyond our control. Financial milestones often command special significance, like my first “real” job at age 15. My older brother got me hired by a company building a bank. My parents surprised me with unusual lenience by letting me drive myself in a borrowed vehicle, though I was still a few months from having an unrestricted license. On my first day, my initial task was enlarging the vent hole for the concrete vault with a hammer and chisel. Next came breaking up a sidewalk with a sledge hammer. I thought I was lucky to be called away from that work, but instead found myself hauling heavy landscaping timbers in the rain at the boss’s friend’s beach house. I got back to the jobsite wet and covered with sand. When I pointed out to the foreman that I’d had no lunch, he begrudgingly let me leave with the admonition to “hurry back.” Instead, I hurried to my truck, hurried home and never looked back. I don’t say that with pride, but I have no regrets. Despite my rough start, followed by a few tough years, my financial journey eventually smoothed out. The milestones began passing by with some regularity for my wife and me. Whether frugal by nature or nurture, our aggressive saving—and lack of troubles—left ample money from each paycheck to ladle into growing retirement accounts. I kept close tabs on the burgeoning balances, excited to see…
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Getting Old

I COULD BE KIND TO my home and say it has rustic charm, but that would be pretentious. The truth is, it’s an old house, built in 1930 by my maternal grandparents. It sits on a remnant of the farm my family once owned. It’s a place I love, and where I’d like to grow old, and therein lies the challenge. More than 20 years ago, my father and I extensively renovated the house inside and out. Within the house, every surface was replaced or refinished. My wife gets credit for a share of the painting. We gave it air conditioning to tame the hot, Georgia summers and a furnace to take some of the chill out of winter. The house is still old and drafty, however. Warmth from the wood heater in the fireplace, fed by trees that I cut on the property, draws the family near when nights are frigid. Though the inside of the house is mostly neat, I can’t say the same for the surrounding property. The rambling yard is decidedly weedy, divided by haphazard beds of old-fashioned bulbs and flowering shrubs lovingly planted by my grandmother, supplemented by annual additions from my wife and me. On three sides, it’s difficult to tell where the yard ends and the surrounding small woodland begins. Out back, the old smokehouse, which once held hams and bacon, is now home to a clutter of tools and is in obvious need of repair. The dilapidated barn is beyond repair, and is waiting to be put out of its misery. Wildlife wanders about when Lottie the Labrador retriever is asleep on the porch. This year, on St. Patrick’s Day morning, after letting Lottie out of her kennel, a familiar sound rang out from near the vegetable garden. From our porch, my wife…
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Social Security Alert?

My mother received an email today from "Social Security Administration"  warning of "Important Changes to Access Your Social Security Account!" It states that "soon you will no longer be able to sign into your online Social Security account using your username and password." It goes on to say in the future, only a Login.gov or ID.me.account, and ends with a big button that says "Sign In to Your Account." I suspect this is bogus. Has anyone else received a similar email?
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Keeping Calm

Planning often costs nothing but time. Even then, the hours we devote to it can buy us buckets of happiness. Some plans may go no further. No matter. There’s no harm done. We’ve spent no money and taken no risk.  A personal financial plan, on the other hand, can be costly–whether it’s implemented or not. For instance, if we don’t do what we know we ought, actions like making a Roth conversion or moving money out of a high-fee mutual fund, we could find our finances treading water. Or, if we follow a poorly-conceived plan, we might even go under. My wife and I hope to sidestep both pitfalls as we put the money plan for our senior years into motion. But I’m finding I can’t avoid facing the emotional cost of changing the habits and thinking I’ve developed over years of nurturing our retirement savings. Dripping in. I recently cut back on my work hours as I phase into retirement. Along with my work schedule, however, my paycheck also got pruned. That means less salary for all purchases, including new shares of stock.  Even so, my wife and I have no logical reason to feel pinched for money. Currently, my part-time pay covers the usual expenses for my family’s frugal lifestyle. There’s even enough left over for low-key leisure pursuits, like the limited travel that keeps us close to our elderly mothers. My employer also pays the bulk of my health insurance premium. And I have an array of other benefits, including a generous allowance for paid time off. Meanwhile, our finances are underpinned by investment accounts at all-time highs. We can’t take credit for their growth. Our heaviest lift was plunking part of each paycheck into index funds during decades of a mostly soaring stock market. Those steady…
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