My Dollar Plan» Reader Mail on My Dollar Plan

Ask Madison: Reader Mail Volume 5

Madison — Thu, 30 Jun 2011 13:29:58 +0000

Time for another round of reader mail. Let’s jump right in:

Have you heard any update on the mfs class action lawsuit you wrote about some time ago? no word in years…wondering what the disposition is. - Dan

I’ve been wondering too… but I haven’t heard a word on it yet! The FAQs don’t list anymore dates beyond the deadlines to submit claims last year. I’m wondering if one day we’ll just get a check in the mail… wishful thinking?

After I responded to Dan’s email, a few readers reported getting letters in the mail this week with the status of their claims. Be sure to check your mail!

How often do you usually wait between credit card apps? I did a 50k Citi AAdvantage bonus in April but am tempted to take advantage of either the Citi or Chase gift card offer too! – KF

I don’t really have a set amount of time. If the offer is good enough, I apply! The way I figure it, if I am not getting any application denials for too many recent inquiries, then I haven’t been applying for enough. Seriously though, it is a good gauge to see how far you can push the bonuses (as long as you aren’t going to be applying for a mortgage in the near future, in which case I’d be a little more cautious).

A few years ago, I used to pick out my favorite 10-20 offers and apply for them all on one day in one sitting. However, I’m a little more selective now that I have so many credit cards and just apply whenever I find one that I really want.

Reading the email of June 15, 2011 (Should We Move to a Smaller House?), we noticed the cost of $115/sq-ft. The list of expenses seems quite complete. What we were inquiring about is the cost for an architect. Is the cost of $115 include the fees of the architect as well as getting permits etc?

We would like to build our dream home and have even found a drawing of the house we would like to build. We feel we can find the land that suits us but our problem is finding the architect. What was the cost for the architect? – Claudio

The first house we built, the cost of the architect was $5,000. That was for a completely custom house, and the cost per square foot was much higher than $115.

In the next house we plan to build, if we build, we would use one of the builders plans, so the cost of the architect will be included in the the $115 per square foot.

I am a reader of your blog and am looking for a new stock broker to trade stocks with. What broker would you recommend? – Brian

Here’s a recent comparison that I did of online brokers.

My favorite broker is usually whoever is willing to give a sign up bonus for a new account. Without that criteria though, whenever I open accounts for family members, I do so at Scottrade.

I hope that helps!

Personal finance articles of the week:

Real Estate

Investing

By the Numbers

Carnivals

And More!

Written by Madison

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Ask Madison: Reader Mail Volume 4

Madison — Thu, 09 Jun 2011 13:29:31 +0000

It’s been awhile since I answered reader mail, opting instead to send personal emails when I can. However, some of the emails would probably benefit others. While I was on vacation, I skimmed through some of the recent emails; here are a couple reader questions that might be of interest to readers:

Very interested in your credit card arbitrage. Would like to know how I could use this for “refinancing” a current rental property I have. The property has a remaining mortgage of $22,500 at 7.5%. I purchased it about 8 years ago. If I am able to use a credit card transfer offer for the full amount, am I able to use the interest charged, as mortgage interest for the rental, considering I will no longer receive a 1099? – Kim

If you are using interest paid for a rental, and it doesn’t come from a bank in the form of a traditional mortgage, there is a second line on the Schedule E (line 13) where you can report “other interest” for mortgage interest that is not from a financial institution or did not send a 1098. That’s where I report the cost when financing properties with credit cards. Just make sure to keep good documentation of the money trail!

On #7, how much is the modification fee? What kind of mortgage do you have in order to get 3.375%? – Chris [Referring to #7: Modify your mortgage in 16 Ways to Lower Your Housing Costs]

I’ve done two modifications, once I paid 0.5% of the outstanding balance, the most recent time I paid 1.0%. I have the 5/5 Penfed ARM. Also, I modified on a day when the buydown for the 3.375 rate was .125 points; today, the rate is 3.25% with 0 points!

Now, onto the personal finance articles of the week…

Retirement

Investing

By the Numbers

And More!

Written by Madison

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© My Dollar Plan

Ask Madison: Reader Mail Volume 3

Madison — Tue, 17 Feb 2009 14:29:21 +0000

It’s time for another round of reader questions! I often get similar questions from readers, so it helps to share the answers with everyone. If you want to check out previous questions, see:

How do you open an ING account for children? I would like to open one for my 11 year old. Don’t they have a minimum age limit? How do you get around it, joint account? She has a savings account that I would like to link it with. -Thomas

Here’s how I opened the accounts for each of my kids. I use a ING $25 Sign Up Bonus, and select the joint account option, which doesn’t have a minimum age limit. I make the kids the primary account owner so the earnings are assigned to their social security number (and essentially tax free). However, kids can’t transfer money, so I link the account to my checking account.

To make the process a more hands on learning experience for the kids, I have them deposit their piggy bank money at our local bank. Then I transfer it to my checking account, and finally to their savings accounts and CDs at ING. It works pretty well.

The premium federal e-file + state TaxCut from Amazon is $40 (at the time of writing). I know that if you e-file the state return through TaxCut it is another $19.95. However in my state (Virginia), I can e-file for free if I fill in the forms online.

Can I prepare my state return with TaxCut so that I know the numbers are correct, and then just plug them into the free e-file at the state site and I am good to go? I had read something about TaxCut forcing you to e-file your state through them if you opted to prepare your state with them. -Joseph

Glad your state offers the e-file for free. You should be fine. I do something similar, I use TaxCut to file my federal return, but then I prepare, print out and send in my state return. TaxCut never forced me to e-file the state return too.

Waitaminit. Do I understand this correctly? If HALF your Social Security plus ALL your gross income from other sources is less than $25,000, you don’t have to file a tax return? In other words, you wouldn’t pay any income taxes? -Funny about Money [Referring to How Much Money Do You Have to Make to File Taxes?]

Yep, you read it correctly. All the income includes retirement plan distributions, tax exempt interest and other exclusions from income. Here’s more information from the IRS: Are Your Social Security Benefits Taxable?

I just started using Mint in December after I read about it on your site. It appears to no longer support my financial institution — UGHHH. Do you recommend another budget tracking site, whether the info is downloaded or manually input doesn’t matter, I just need a reliable site. -Ann

That sucks that they pulled your bank. Quicken offers a free online version if you want to give it a try.

I use Microsoft Money myself, but not the online version, the software version that goes on the desktop. I had to purchase it, but I can tell you it’s one of those products I can’t live without.

I love your site as I find it very useful, but some of the information sometimes doesn’t apply because I’m from Canada. Do you have a site for Canadians? Or can you direct me to a site that offers great advice for Canadians? -Pamela

My favorite site for Canadians is Million Dollar Journey. It’s a fantastic site and you’ll find a lot of helpful information there.

Written by Madison