Social Media 101: Tips From a Recent Seminar

Earlier this year, I taught a class called Social Media 101 to introduce older adults to the basics of three frequently used social media platforms: Twitter, Facebook, and LinkedIn. Below is a summary of the class content:

Positive and Negative Effects- Social media is a lot like credit cards. If used responsibly, there are positive impacts: convenient purchases and money-saving rewards points (credit cards) and education, collaboration, and community building (social media). On the flip side, if used in negative ways, credit cards can result in overspending, debt, and anxiety related to unpaid bills. Negative impacts of social media include privacy and time-use concerns, connecting people to do bad things, and mental health issues such as anxiety, depression, and FOMO (fear of missing out).

 

Outreach Potential- Facebook and YouTube are the most widely used social media platforms. If Facebook were a country, it would be the largest in the world with a “population” of about 2.6 billion users, which exceeds the populations of the world’s two largest countries, China and India. It is, therefore, not surprising that many businesses and non-profit organizations actively engage with Facebook, in addition to millions, or in the case of Facebook, billions, of individual users. India has the highest number of Facebook users, followed by the United States and Indonesia.

 

“Whys” for Social Media Use- Effective social media users have a “why?” In other words, one or more reasons why they take the time to use one or more social media platforms. Common “whys” include: to stay connected with friends and family, to obtain local and national news, to promote a brand/business or get hired for a job, to learn new information, to follow respected thought leaders, to share opinions, and to be part of a group of people with similar interests.

 

Social Media Game Plans- Each social media platform needs a game plan. For example, will its messaging be “professional/business use only” (e.g., LinkedIn), “personal use only” (e.g., Facebook), or both. If someone wants to combine personal and professional messaging on one social media platform (e.g., Twitter), will they use one account or two? Answering these questions is especially important when someone has a business-related account. Posting personal information on an account meant for business can confuse followers and raise questions about the account owner.

 

Messaging “Guardrails”- It is useful for social media users to determine their “wheelhouse,” i.e., topics that they will post messages about because they are an area of interest and/or expertise. In addition, content creators should determine “off limits” content, such as politics or controversial topics. Having these “guardrails” established in advance can help users determine what (and what not) to share online and to “stay within their lane.” Examples of guardrails are: positive words, pretty pictures, useful information and links, no politics or controversial topics, and no shaming or blaming.

 

Visuals Increase Engagement- Visuals attached to a social media posts “slow people down” and increase the odds they will stop to read the text of a social media message. Research has found that visuals increase social media engagement  (i.e., likes, comments, shares, direct messages) by about three times  Examples of social media visuals include stock images, personal photos, hand-drawn sketches, PowerPoint jpeg images, images created using online platforms such as Canva, bitmoji avatars, photo collages, charts and tables, and short video clips called gifs.

 

Strong Profile and Quality Photos- Social media platforms provide an opportunity for users to describe themselves within a designated number of words. Personal descriptions should be consistent with a social media user’s game plan (i.e., is the platform for personal or business use?). Retirees will typically have different profiles than workers and will likely list leisure, versus career-oriented, pursuits. Experts in web design recommend using two high quality (1,500 x 1,500 pixel) photos or logos for the head shot of the account owner and the header image at the top of the page.

 

Requests to Connect- Whether they are called followers (Twitter), friends (Facebook), or connections (LinkedIn), social media platforms have mechanisms for people to reach out to others and connect so that they are able to view each other’s content. Similarly, there are commands (e.g., “unfollow” on Twitter and “unfriend” on Facebook) where people can “disconnect” from each other. Before accepting a request to connect, answer four key questions: Do you know the person? What is his/her relationship to you? Do you have things in common? and Is he or she a positive person in real life?

 

In summary, social media can be a force for good…or not. It depends on how you use it. 

This post provides general personal finance information and does not address all the variables that apply to an individual’s unique situation. It does not endorse specific products or services and should not be construed as legal or financial advice. If professional assistance is required, the services of a competent professional should be sought.

 

 

Ten Tax Planning Tips for 2022

Now that 2021 income tax season has been over for a month and the dust has settled, it is time to start some serious tax planning for 2022. Planning now provides seven months to take action and/or implement changes to avoid a stressful “tax scramble” at the end of the year. In an earlier blog post, I described 12 tax planning topics for 2022.

 

In this post, I continue the conversation with ten tax planning tips for 2022 (in no particular order) for readers to consider:

¨    Plan for Tax Benefits That Go Away- On a recent webinar, I heard stories about dramatic increases in 2021 tax refunds for families with children resulting from the expanded child tax credit and child and dependent care credit. “Normal” tax rules apply in 2022, however, which may require a withholding change for many families to avoid getting a smaller refund, or owing tax, in 2023. To do this, file a new W-4 form or make larger estimated payments.

 

¨    Determine Your 2022 “Safe Harbor”- The safe harbor rule is an “income tax get-out-of-jail-free card” to avoid an IRS under-withholding tax penalty. It works like this: withhold 100% (110% with an adjusted gross income or AGI more than $150,000) of tax owed for the previous year (i.e., 2021) or 90% of current year (2022) tax liability using a W-4 form at work for job-related income tax withholding; withholding for Social Security, a pension, and required minimum distributions through account custodians; and/or quarterly estimated payments using IRS Form 1040-ES.

¨    Improve Your Tax Records- If disorganized records were a problem for 2021 taxes due in 2022, set up a better system. Since there is no longer a non-itemizer’s charitable deduction in 2022 and only about 10% of tax filers itemize, you’ll probably have fewer receipts to save. Common filing methods include file folders, a large envelope, and a designated desk drawer. To err on the side of caution in the event of an audit, experts advise keeping tax records for at least six years.

 

¨    Set Up Spreadsheets- Taxpayers with recurring income and/or expenses (freelancers, landlords, Airbnb and VRBO hosts, employees with side hustles, etc.) should consider purchasing software or setting up a simple Excel spreadsheet to aggregate their business income and expenses throughout the year.

 

¨    Ramp Up Retirement Savings- Consider increasing retirement savings in a tax-deferred employer retirement savings plan (e.g., 401(k), 403(b), and traditional IRA). Saving even 1% more of pay can make a difference in later life. There are online calculators like this one than can show you what you could save. Also consider some savings in taxable and/or tax-free accounts so you have tax diversification (i.e., assets that are taxed in different ways).

 

¨    Beware Roth IRAs- There’s nothing wrong with Roth IRAs. They are a great retirement savings tool. However, if your 2022 income could be close to the limits to make contributions ($144,000 for individuals and $214,000 for couples filing jointly in 2022), it may be best to wait until early 2023 when your actual income is known. Otherwise, you may need to do an excess contributions withdrawal and pay tax on any money that an early contribution earned.

 

¨    Consider a SEP- With millions of Americans quitting jobs during the last year and many becoming part-time freelancers or full-time entrepreneurs, a simplified employee pension (SEP) can be a great retirement savings option. Depending on business income, SEPs often have higher contribution limits than IRAs. The deadline for making 2022 SEP contributions is the tax filing deadline in April 2023. Take time now to research potential account custodians.

 

¨    Plan for IRMAA- Older adults on Medicare should project their 2022 income as best they can, although it is difficult to know now what taxable mutual fund distributions or self-employment earnings might be. If income appears to be on track to trigger an income-related monthly adjusted amount (IRMAA) Medicare surcharge, it may be wise not to aggravate the situation with taxable capital gains and Roth IRA conversions. Seek professional advice, if needed.

 

¨    Determine “Bunching” Potential- Bunching is a legal tax minimization strategy where taxpayers aggregate sufficient tax-deductible items to exceed the standard deduction for their age and tax filing status. The 2022 standard deduction is $12,950 for individuals ($14,700 age 65+) and $25,900 for married filing jointly ($28,700 if both spouses are age 65+). An example of a bunching strategy is combining three deductible items: state income and local property taxes up to the $10,000 cap; unreimbursed medical expenses for an elective procedure, and charitable donations.

 

¨    Tax-Saving Actions- Now is the time to do research, seek professional advice, and determine “process steps” for strategies to reduce your taxes in 2022 or beyond. Five examples are tax-loss harvesting, Roth IRA conversions, qualified charitable contributions (age 70½ +), setting up a donor advised fund, and increased contributions to a tax-deferred retirement savings plan, health savings account or HSA (if eligible), or flexible spending account or FSA (if available).

This post provides general personal finance information and does not address all the variables that apply to an individual’s unique situation. It does not endorse specific products or services and should not be construed as legal or financial advice. If professional assistance is required, the services of a competent professional should be sought.

 

 

Facebook at Its Best: Education and Collaboration

Facebook (FB) has had its fair share of criticism in recent years. Concerns include privacy breeches, failure to monitor and take down divisive or questionable content, and encouraging FOMO (fear of missing out), unhappiness, and even depression when FB users are exposed only to the curated best side of others and become anxious about “likes” for their content.

Much like credit cards, FB has two sides: as a negative tool with harmful effects and bad actors and 2. as a positive tool for education, positive collaboration, and information sharing. I'm going to do a 180º turn from Facebook's many "issues" (nobody says problems anymore!) and share a positive example of how FB helped members of my Florida community.

In February, I taught a class at a local community adult education center and heard a story about a fraud case that I felt I had to share with others, to warn them. So I posted the following message on the community FB page:

 

I just heard a true story from a local older adult (read: someone just like us) while teaching a class this morning. The person's credit card information was recently hacked by someone who placed a skimming device on a gas pump at a local gas station within 4 miles of our community. The victim only has one credit card and is now without any credit card access for a week or so until a new card arrives.

Here are 4 take-aways for everyone to consider:

1.   Consider paying cash for gas. I always pay cash for gas (to avoid possible skimmers) and at restaurants (to avoid dishonest waiters who could skim my account number- or take a cell phone photo of it- and commit ID theft). Nobody touches my credit card but me. It is a risk reduction strategy.

2.   If you use a credit card for gas, a red-flag for skimming machines is when you have to swipe your card multiple times to get the transaction to go through. If this happens, stop swiping and notify gas station staff of the issue with the pump.

3.   If you use a credit card for gas, try to use pumps closest to where gas station workers are. According to ID theft experts, pumps farthest away from where workers can see them are more likely to have skimming devices placed on them. The victim used a pump on the outskirts of the gas station.

4.   Have a second "Plan B" credit card just in case unexpected events like this happen.

Again, a true story from a local older adult that we can all learn lessons from.

From, there, community members shared additional cautionary advice related to credit card and online security. Not only did they discuss skimming devices, but also personal security strategies, RFID (radio-frequency identification) sleeves, and contactless “tap and go” credit cards that have the icon used to identify Wi-Fi on them. They also shared tips and fraud warnings of their own. Below are some examples:

¨    Another credit card tip. We use a credit card just for online purchases. It has a low line of credit attached to it. This way, if the card number is compromised, it will be easy to spot.

 

¨    Most credit cards allow you to set up alerts when the card is used for a transaction above a set dollar amount. I have all of mine set up to notify me of any transaction over 1 cent. So, I get an immediate text message whenever my cards are used. I've caught scam transactions this way and immediately contacted the credit card company.

 

¨    If you tap and pay with your card, it uses a different technology. You cannot be skimmed with tap and pay.

 

¨    Be careful using the drive-through cash machine at your bank also. Our debit card was compromised at our own bank. The drive-through machine is serviced by an outside vendor. Lesson learned. A branch of the bank in question is located close to our community.

The FB posts reminded me of a threaded discussion for an online college course where students are expected to read what their peers have posted and contribute new information to the conversation that adds value. However, in this case, the posts were not being graded. Instead, they were completely organic, positive, and helpful. 

Facebook (and other social media) has the potential to live up to its promise of connecting individuals in a positive way. My initial post about credit card fraud is an example.

This post provides general personal finance information and does not address all the variables that apply to an individual’s unique situation. It does not endorse specific products or services and should not be construed as legal or financial advice. If professional assistance is required, the services of a competent professional should be sought.

Frugal Spending Tips for Your Next Road Trip

This post is excepted from an article that I wrote for my brother Michael's website about preparing for a road trip during these challenging financial times with rising food, gas, and travel expenses. 

My brother Michael, a professional photographer and avid motorcyclist, started the website Roadcraft USA to share his passion for beautiful scenery and fun and interesting road trips, especially the two-wheeled kind. What do I know about motorcycles and professional photography? Absolutely nothing. Nada. Zilch. Basically, no “street cred,” whatsoever. 

My “wheelhouse” is personal finance. 

Nevertheless, Michael and I collaborated on an article about money-saving road trip tips. I wrote the words and he added all the pretty pictures. Below is the section of the article that describes money-saving tips for food, lodging, and gas.

       

Ready For a Road Trip? 

No matter what your travel style, start planning your road trip by setting some goals:

 

¨     Do you want a structured itinerary or to go “where the road takes you”?

¨     What would you like to do or see (e.g., beaches, wineries, national parks, sporting events)?

¨     Are there people you want to visit along the way?

¨     Are there new foods and restaurants you want to try?

 

Next, create a financial framework by answering the following questions:

 

¨     What is the total amount of money needed to fund your trip?

¨     Do you need to save the money or is it already in the bank?

¨     What are anticipated expenses for different aspects of the road trip (e.g., food, gas, and lodging)?

¨     Do you have money set aside for unanticipated expenses (e.g., vehicle repairs and price increases)?

Frugal Travel Hacks

Everyone wants to get as much value as possible for their travel budget and not overpay for goods and services. The following ideas are like a menu in a New Jersey diner. There are a lot of options to select from so pick those that best fit your personality, lifestyle, and mode of travel (e.g., motorcycle or car).

Food and Beverages

Eat Out Sparingly- Try to eat only one meal a day at a restaurant, if possible. Pack foods such as granola bars, dried fruits, peanut butter, muffins, and canned juices for breakfast, or select hotels that include a free continental breakfast. Many hotels offer perks (e.g., free breakfast and swimming pools) to attract visitors.

Keep Food Cool- Pack food in a cooler (or buy it when you arrive at a destination) and stay at hotels with a refrigerator and/or microwave oven in the room. This lets you save leftover food from a restaurant or order take-out food rather than a sit-down meal. Pack some re-sealable food storage bags or plastic containers.

Rethink Restaurant Drinks- Consider sticking with complimentary water at restaurants because beverages add to the cost of eating out. If someone skips 208 glasses of soda (four a week) at $3 each- or 104 beers or glasses of wine (2 a week) at $6 each- that’s $624 in annual savings.

Bring Your Own Beverages- Space permitting, bring your own beverages on a road trip. Examples: bottled water, soda, and low-cost wines available at Trader Joe’s and Aldi supermarkets. Another way to spend less on wine and soft drinks is to “stretch” them with a large cup of ice so they last longer and you can buy less.

Split an Order- Consider sharing an entrée- but check first to see if there is an additional “plate charge” for shared meals. Appetizers and desserts are also great for sharing. Instead of individual desserts at a restaurant, buy a dessert item (e.g., cake or pie) at a supermarket to enjoy afterward.

Eat Out for Lunch- When you eat out, consider going to restaurants at lunchtime, rather than dinner, because the cost is generally less. You might also consider combining lunch and dinner into one meal by having a late afternoon “linner.” Lunch menu meals- and lower prices- are generally in effect until around 3 pm.

Lodging

Join a Group- Travel with a group of people such as family members, friends, or members of a motorcycle club. Some people save money by sharing vacation expenses (especially lodging and food) with others. An example is renting a multi-room condo, beach house, or cottage and sharing rent and food costs.

Find Coupons- In some high-traffic areas (e.g., busy interstate highways and state tourism welcome centers), tourist guidebooks are chock full of coupons to save money on hotels and food. Check the “fine print,” however, for exclusions such as weekends and holidays and whether an advance deposit is needed.

Search Online for Deals- Look for deals on hotel room rates through booking websites (e.g., Kayak, Expedia, and Priceline) and compare them to rates available on hotel websites. Again, check the terms and conditions of each pricing arrangement (e.g., advance deposits and refunds).

Travel Off-Peak- Take your road trip during times when crowds are smaller and prices for lodging of any type (e.g., hotels, campgrounds, RV parks) are likely to be lower. Consider traveling during the less expensive “shoulder season” right before and after high-cost peak season dates.

Join Rewards Programs- Sign up for hotel rewards programs and accumulate points. Concentrate on a few hotel chains so points grow faster. When you have earned enough points for a free stay (this will vary by hotel brand, location, and time of year), cash in your points for free hotel nights.

Stay Local- If money is tight, be a “local tourist.” Visit local historical sites or parks and learn more about where you live. Plan “daycations” (inexpensive one-day trips) and “staycations” (experiences at or near home) in lieu of travel to distant areas. Focus on doing fun things together as a family or group of friends.

Gas

Travel Efficiently- The easiest way to save money on gas is to drive less. This is true whether commuting to work or taking a road trip. With this is mind, plan your road trip using one of many available trip planning apps that calculate the time and distance between places and build a travel map.

Find Cheap Gas- Gas prices vary from state to state and even within the same town! Gas stations close to major highways often charge more than others…because they can. Use a gas app like GasBuddy and Waze to find the cheapest source of gas where you need it.

Pay With Cash- Many gas stations charge less per gallon for cash purchases (vs. credit cards) because they avoid credit card processing (a.k.a., interchange) fees. Paying with cash also avoid the risk of having a credit card skimmer placed on a gas pump to steal personal data.

Join a Fuel Rewards Program- Sign up for a fuel rewards program at a supermarket or warehouse club and accumulate points to earn free or reduced price gas. When you have earned enough points for a reward, cash in your points to save money.

Time Your Fill-Ups- Travel experts recommend filling up early in the work week (i.e., Sunday and Monday) or at the end (i.e., Friday) and to avoid the middle of the week, especially Thursdays. Of course, on a road trip, when you need gas, you need gas. This is when gas apps come in handy.

Check Tire Pressure- All the travel experts agree that underinflated tires decrease gas mileage. Many gas stations have inexpensive “do it yourself” machines where users can check their tire air pressure and inflate tires that need air.

This post provides general personal finance information and does not address all the variables that apply to an individual’s unique situation. It does not endorse specific products or services and should not be construed as legal or financial advice. If professional assistance is required, the services of a competent professional should be sought.