Self-Driving Cars: Are the Safety Features Worth It?

by Gerri Willis

You’ve been hearing about it for a long time now – the advent of the self-driving car – and while it seems like science fiction, the reality is, that we are getting darn close to vehicles that can do all the heavy lifting for you. They call it “Intelligent Drive” at Mercedes Benz, a number of bundled driver-assist features that allow the car to drive itself. There are cameras to augment sensors on the car, steering-assist and even brake assist. Take your hands off the wheel and the car literally drives itself. I recently went to Consumer Reports test track to drive a Mercedes S550 to find out exactly what it’s like to be behind the wheel of a car that drives itself. And, the answer is this: It’s not easy to give up control!

For example, when we tested the brake assist feature, rolling up to a barrier at 20 miles per hour, I found it too irresistible to punch the brake before the car did itself. To me, it’s just a little creepy giving up that much control over to a machine. On the other hand, if I were nodding off at the wheel on a dark and stormy night, I might be glad to have such a feature. There’s also a warning when you stray out of your lane and a park assist feature. The package on this particular model costs $2,800, but you can find other vehicles with some of these features integrated into the overall cost of the vehicle. The 2014 Jeep Cherokee can parallel park you, although I found the experience uncomfortable since it makes the move super quickly and, in my case, would have ended up on the curb had one existed. However, the Jeep’s blind spot monitoring was terrific.

I am not sure I would pay for all these features – not now anyway – but there are two features that all of these cars seemed to have that I would love to see as standard features. One is a back-up camera. I own a crossover and I find the ability to see behind my car is constrained. A rear-view camera would be welcome. The blind spot detection was also a bonus. Bottom line: I’m not sure I’m ready for all this technology yet, but some of it is much appreciated. 

 

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Avoid College Tuition Sticker Shock

by Gerri Willis

Sticker shock. That’s exactly what a lot of parents across the country are feeling as they study the financial aid package being offered to their prospective college freshman. For that reason, if you are part of the sticker shock crowd, you’ll want to look in every nook and cranny you can for the scholarship dollars.

Normally, you’d expect your high school counselor to help you find grant money, but given that the ratio of counselors in any given school is typically 500 to 1, you’re best off scouring the field yourself. Where to start? Rob Franek, Princeton Review Vice President, says that the biggest sources of free money for college students are federal government and institutional grants, which together comprise 79 percent of all the grant dollars out there. But don’t ignore grants given out by employers and states, which make up 21 percent of the free money available.  Don’t forget the local Lion’s Club and your church.

Your child will be competing with fewer people for those dollars, even if the grants are small.  And, then there are off beat scholarships, like the ones for left handers, which are worth searching out.

The biggest bucket of money, no doubt, is doled out by the schools themselves to lure the students they really want to attend. You put your name in the hopper for this money by filling out the FAFSA – that’s the Free Application for Federal Student Aid. 

The good news is this – according to Franek – just a third of college students pay the full sticker price for college. By checking out websites like scholarships.com, you can bring down your total costs of college!

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Appealing to a College for More Financial Aid

by Gerri Willis

The excitement of getting accepted by a college or university can pop like a balloon once you start getting your arms around just how much money your child’s education will cost you. This is the time of year that prospective students start getting their aid package for the upcoming school year and if you aren’t happy with what you see, you may want to appeal the school’s decision and ask for more.

Be advised: The process is delicate. College administrators don’t like to think of what they are doing as negotiating your package, so tread lightly. Kal Chaney, the author of “Paying for College Without Going Broke,” suggests starting by asking the college for information about their appeals process. Some may have a form, others may ask you to provide a letter. Review your aid forms and make sure that any errors are pointed out to the school. If your financial situation has changed, if there has been a job loss in the family or any unusual expenses, inform school administrators. To get their attention, make sure you document any income changes, even if for example, mom and dad are now also supporting an elderly relative. 

Another issue to consider: If you have received better offers from other schools that are ranked similarly, it’s worth your time to let school administrators know. Many may match or even beat the offer, depending on just how much they want your little John or Wendy at their institution.

Chaney says parents should be sure NOT to accept the offer of admission until the package is appealed and to never use the word “bargain” or “negotiate” with the aid office. (Even though that is exactly what you are doing).

Keep in mind, it’s not just low income families who get financial aid. For the first time, the average household income of financial aid applicants will top $100,000, according to Noel-Levitz, a college consulting firm. Bottom line, it doesn’t hurt to ask for additional help. Just be careful how you do it.

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Decoding a College Offer Letter

by Gerri Willis

It’s that time of year when prospective college students all over the country are getting acceptance letters and financial aid packages. If you or a member of your family is part of this group, steel yourself. Confusion is the most common reaction to these packages. What’s more, you may be disappointed. That’s OK, it’s also that time of year when you can ask college administrators to step up the grant money.

But first, understand the package itself. The big headline is whether your son or daughter (or yourself) has been accepted. Congratulations if the answer is yes. Step No. 2 is to understand just how much this is going to cost. It’s not simple, given the way most of the award letters are written. A third of the award letters don’t include the full cost of sending Junior to school. Yes, it will include tuition and some fees, but other major costs, like books, transportation and living expenses are omitted, says Mark Kantrowitz, in his new book, “Filing the FAFSA: The Edvisors Guide to Completing the Free Application for Federal Student Aid.”

Watch out; too, for whether the money the college is willing to give you is a grant, which does not have to be paid back, or a loan, which clearly does have to be paid back. You’d think it would be easy to discern this from the letter, but unfortunately it is not. Loans are often not labeled as loans. So you’ll need to check with the school to make sure you understand which money is free and which has to be paid back.

When comparing offers, you’ll need to understand what the net costs to you will be. Beware: The letters include a net cost figure, but these often include loans. So, do the math on your own. Calculate a true cost of attendance and subtract grants, scholarships and gift aid – money you will not have to pay back. Then compare these figures across institutions.

The good news is that it pays to ask for more – more free aid. Thirty to 50 percent of families who ask for additional money from private colleges and universities get it. Many Ivy League schools will match needs based on offers from other schools. Or if your financial situation is changed through job loss, for example, you may be able to get more money. The key, here, is that it doesn’t hurt to ask. Insiders, however, say you’re best off not describing the conversation as a “negotiation.”

Bottom line, get the details before accepting the offer. Be sure you understand just how much money you and your family will be on the hook for, and what free money or grant aid you will get.

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More Bang For Your College Bucks

by Gerri Willis

If there’s one regret most college students seem to have it’s this:  That they spent too much for their college education. I see the problem up close and personal here in New York City, where it’s not uncommon for a journalism student to graduate from an Ivy League or near-Ivy League school with $100,000 in debt. Given the fact that starting salaries in journalism are low, it’s no wonder these students struggle.

One rule of thumb prospective college students and their parents should use is this: Your four-year total college tab shouldn’t exceed the starting annual salary in your field of choice, that’s according to Kal Chany, founder of Campus Consultants and author of “Paying for College Without Going Broke.”  Chany says meeting that hurdle may be easier said than done, and added, “There is no one size fits all answer.”

To be sure, though, some students will find it difficult to hold to that rule of thumb, and for that reason, many apply for student aid. The FAFSA is the most critical tool to accessing that aid and you can still make application for federal student aid now for the 2014-15 school year. Even if you don’t think you’re eligible for assistance, Chany says it’s important to apply. Other common mistakes people make in applying for federal aid include using the wrong year’s version of the form, waiting to be accepted to college to apply for aid and even using an incorrect Social Security number.

But it’s not enough to simply borrow a lot of money. If you want to keep your costs low, you’ll seek out schools that have the best return on your dollar. The average cost of a four year degree at Harvey Mudd College as an eye popping  $229,500 with average annual scholarships of $27,763, but the return on investment over 20 years is over a million dollars. Graduates of MIT, the California Institute of Technology and Stanford University all enjoy similar high rates of return, according to an evaluation by PayScale.

Bottom line, plan ahead – in terms of both nailing down as much grant money as you can and finding a college that gives you value for your education dollar.

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Do You Have What It Takes To Put Down Your Credit Card For Good?

by Gerri Willis

What if I told you there is a way you can save your family twenty percent whether you are shopping at the grocery store or the mall -- guaranteed? You’d be surprised, right? Well the reality is that most people who use cash only in their transactions spend 20 percent less than people who pay via credit cards, according to the National Foundation for Credit Counseling.

But how do you do it and just how difficult is it to dump the cards and pay in cash? That's the question we're asking viewers this week as we launch The Willis Report Cash Challenge. In the wake of the credit card breaches at retailers across the country, many of our viewers have been asking questions about just how hard it is to convert to paper (cash) over plastic (credit cards).

More and more people are opting for cash. According to a survey of shoppers conducted by Harris Poll on behalf of Feedzai, a cyber-security firm, forty percent of people who were aware of the data breaches are using cash more and plastic less. The breaches, more than anything else, seem to be spurring people to change their habits. Just last week, beauty retailer Sally Beauty Holdings, became the most recent retailer to go public with the news that hackers had broken into their systems. But the biggest breach occurred at Target, where information about 70 million customers was hacked during the Christmas season. Cyber security experts say it's no longer a question of whether your personal information will be stolen, but when.  

To be sure, the adjustments can be difficult, but the payoffs are greater than just protecting your personal identity, although that's no small thing. Surveys show that people who use cash instead of credit cards spend less. And, it's easy to see why. Giving a cashier your cold, hard cash --the money you toiled to earn -- is a much different experience that handing over your credit card. Using plastic, distances you mentally and emotionally from the transaction. It becomes an exchange that will happen in the future; say a month from now, when you get your credit card statement instead of something that's happening right now. I believe that credit cards are a powerful tool, if used correctly. But most of us use them as a crutch to upgrade our lifestyles beyond what we can afford.

Dumping the cards then has more appeal than ever. But making the change is no small task. What do you do if you have to fly cross country for a family emergency? What if the kids need something for a class assignment Monday and it's already late Sunday night? The challenges are real, but planning is the key to making going cash free work.

Most all-cash families make it work by planning their spending, developing a budget and buying only those things that fit the budget. Look, credit cards, in my view, are a powerful tool, but no substitute for actually figuring out what you should be spending. As a result, different people adopt a "Cash is King" lifestyle in different ways. Some use debit cards, others use checks. Some online shoppers buy gift cards. But the message is all the same. Pay now for what you buy now.     

In the coming weeks and months we will be following viewers who agree to take the challenge. If you believe cash is king, join us. Send us an email at gerriwillis.com or tweet or Facebook me @GerriWillisFBN.

 

Don’t miss The Willis Report 5pmET on FOX Business

Cash Challenge

by Gerri Willis

Can you go credit-card free? That's the question we're asking viewers this week as we launch The Willis Report Cash Challenge. In the wake of the credit card breaches at retailers across the country, many of our viewers have been asking questions about just how hard it is to convert to paper (cash) over plastic (credit cards).

To be sure, the adjustments can be difficult, but the payoffs are greater than just protecting your personal identity, although that's no small thing. Surveys show that people who use cash instead of credit cards can save as much as 20 percent. And, it's easy to see why. Giving a cashier your cold, hard cash --the money you toiled to earn -- is a much different experience that handing over your credit card. Using plastic distances you mentally and emotionally from the transaction. It becomes an exchange that will happen in the future; say a month from now when you get your credit card statement, instead of something that's happening right now. I believe that credit cards are a powerful tool, if used correctly, but most of us use them as a crutch to upgrade our lifestyles beyond what we can afford.

More and more people are opting for cash. According to a survey of shoppers conducted by Harris Poll on behalf of Feedzai, a cyber-security firm, forty percent of people who were aware of the data breaches are using cash more and plastic less. The breaches, more than anything else, seem to be spurring people to change their habits. Just last week, beauty retailer Sally Beauty Holdings, became the most recent retailer to go public with the news that hackers had broken into their systems. But the biggest breach occurred at Target, where information about 70 million customers was hacked during the Christmas season. Cyber security experts say it's no longer a question of whether your personal information will be stolen, but when.  

Dumping the cards, then, has more appeal than ever. But making the change is no small task. What do you do if you have to fly cross country for a family emergency? What if the kids need something for a class assignment Monday and it's already late Sunday night? The challenges are real, but planning is the key to making going cash free work.

Most all-cash families make it work by planning their spending, developing a budget and buying only those things that fit the budget. Look, credit cards, in my view, are a powerful tool, but no substitute for actually figuring out what you should be spending. As a result, different people adopt a "Cash is King" lifestyle in different ways. Some use debit cards, others use checks. Some online shoppers buy gift cards. But the message is all the same. Pay now for what you buy now.

In the coming weeks and months will be following viewers who agree to take the challenge. If you believe cash is king, join us. Send us an email at gerriwillis.com or tweet me @GerriWillisFBN.

Don’t miss The Willis Report 5pmET on FOX Business

What You Need To Know Before Signing Up For Health Insurance

by Gerri Willis

Monday is a big deadline for the Affordable Care Act. It’s the date by which all of us have to be able to prove we have healthcare coverage or face a hefty penalty on our 2014 taxes next year. So far, the Department of Health and Human Services say signups have failed to meet goals. The administration had said it wanted seven million people to sign up, but only five million have done so, according to the most recent government report. So, you can bet the healthcare.gov website will be pretty busy over the next several days. Here’s what you need to know if you plan to sign up:

Before you go to the web to enroll, talk to your doctor to find out whether he or she is affiliated with any of the insurers offering plans through Obamacare. Best case scenario, you’ll want to stay with any service provider you are already using to make sure that your care is seamless. Once you are armed with that information, head to healthcare.gov, that’s the federal website. In some states, you’ll do your shopping on this site, but in others you’ll be directed to a state site for assistance. Depending on where you live, you may find a dizzying array of plans or only a few. Don’t be confused by the names of the plans. Words like “exclusive,” “premier” and “predictable cost,” have virtually no meaning, except to the insurers themselves. Instead, focus on the level of coverage. Policies are available in four categories from the least to the most generous: bronze, silver, gold and platinum.

According to one analysis of the insurance offerings, you’re best off considering the bronze plans first. According to Dr. Scott Gottlieb, here’s why: You can’t trade up to a better benefit by buying gold or even platinum plans. The benefits are the same regardless of the category or “metal” that you choose. Gottlieb says that the only difference with the plans is the structure of the co-pay and deductibles. As you pay higher premiums for a gold or platinum plan, your deductibles and co-pay decline. The insurer, according to his analysis, typically covers 60 percent of expected medical expenses in a bronze plan, 80 percent in a gold plan and 90 percent in a platinum plan. So, by buying the costlier plans, you are simply fronting a higher premium to buy down your anticipated out-of-pocket costs. The doctor networks are all the same, as are your access to drugs. 

Once you choose a plan and make a payment, be sure you get a clear confirmation that your choice is confirmed. One man I interviewed on The Willis Report, thought he was enrolled and even had money deducted to pay for the policy, but was ultimately denied coverage. Worse, he suffered a heart attack and was directly billed for $407,000 for care. Making sure you are enrolled and actually have coverage is your responsibility. Contact the insurer directly to make sure all the paperwork has been processed and you don’t get caught without coverage when you need it.

Finally, Obamacare requires everyone to have some sort of coverage, whether its ACA offerings, Medicare, Medicaid or employer-sponsored coverage. The first-year penalty for not having coverage is 1 percent of your annual income or $95 whichever is greater. If you miss the deadline, you’ll have to wait for the 2015 enrollment period to get coverage unless you experience a major live event like marriage or divorce. To be sure there may be exceptions to the deadline. Some states will accept enrollments after Monday. Check the healthcare website for details.

 

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Before You Buy Gluten-Free Products

by Gerri Willis

You can’t go anywhere these days without running into gluten-free products. Whether you’re at the grocery store or in a restaurant, the gluten-free option is everywhere. Heck, even the Girl Scouts this year are offering gluten-free cookies. The question is do you need to buy them?

Gluten-free, according to the Federal Government means getting rid of the protein found in wheat, rye and barley. People with severe gluten allergies, a condition called celiac disease, try to stay away from gluten. But those folks make up only one percent of the population. What’s going on now is the food manufacturers are promoting these foods to everyone as healthier.

And, it’s working. The business of gluten-free products is expected to grow 50 percent in the next few years to $15 billion in sales by 2016. Today’s gluten-free products are purchased by 11 percent of customers – more than ten times the number with celiac. At the same time, wheat flour consumption has fallen to a 22-year low, according to the U.S.D.A. So these non-wheat products are popular with loads of health-conscious consumers who believe in its benefits. Experts say as many as 18 million people or 6 percent of the population may have sensitivity to gluten.

But here’s the rub: These products are more expensive than their more common counterparts – way more. Consumer Reports estimate that gluten-free products can cost two to three times more than regular non-gluten free products. What’s more, you don’t have to pay the premium price to stay away from wheat in some categories. Plenty of foods are naturally gluten-free, like polenta, rice-crackers and nuts. 

Even so, food makers are on the bandwagon. General Mills, whose brands include Bisquick and Pillsbury, have begun reformulating products to remove gluten. It’s already reformulated Chex and plans to introduce gluten-free brownies, cookies and cakes next year. Likewise, the grocery store chain, Wegman’s, is now the country’s largest seller of gluten-free products. New brands, like Udi’s and Glutino, are taking advantage of the trend.

Just keep in mind as you shop the supermarket aisles that cheaper options may be available.

 

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Avoiding an IRS Audit

by Gerri Willis

Avoiding the audit should be goal No. 1 when it comes to your taxes this year. And, here's where an ounce of prevention can prevent a pound of cure. Here's what to be on the lookout for: 

  • If you are a high earner, you are more at risk for an audit. Taxpayers earning $200,000 or more have an audit rate three times more than the general population. And if you're earning  a million dollars, you're chances jump to one in nine. The lesson of the story: The more you make, the more careful you need to be with your filings. 
  • The home office deduction. It's everyone's favorite, unfortunately not everyone should take it, and this year the rules have changed. You can opt to use a simplified formula that maximizes the write-off at $1,500. Whether you use the new calculation formula or not, make sure the space you say you're using as a home office is used exclusively for that purpose. 
  • Non-cash charitable contributions are a favorite area of scrutiny for the IRS.Many families like to give the old family clunker as an in-kind gift to their favorite non profit. If you choose to do so, be sure the car is properly valued. 
  • You claim deductions that are disproportionate to your income, such as large charitable contributions, substantial mortgage interest or real estate taxes. The IRS knows average deductions for filers of varying incomes. If your deductions are out of line, you may get a second look. Having said that, don't back away from deductions you are due. 
  • You forget to claim income. If you get incomes from various sources, you'll need to report it, even if the 1099 form doesn't reach your mailbox. That's because the employer will no doubt report your pay to the IRS on their income tax form. It's easy to lose track of these payments over the course of the year. Keep good records. 

Finally, if the worst happens and you do get contacted by the IRS, don't panic. Chances are what you're experiencing is a "correspondence audit," meaning it is a request for more detailed information conducted by letter. You may be well able to handle this yourself by supplying the missing information. 

 

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