SoFi

If you’re like most borrowers, particularly those with six figures’ worth of student loans from graduate or professional school, you might find that looking at your student debt square in the face is a downer, but repayment can be managed.

Is refinancing a good idea? It can be. When? When you can snag a lower interest rate and in a few other situations.

Student Loan Repayment Plans

Chances are you set up a student loan repayment plan after graduation and figured you’d revisit it later — when you’re making more money, when your career is more secure, when you have more time. The standard repayment plan for federal student loans is 10 years. Direct Consolidation Loans have a repayment period of 10 to 30 years.

Putting off the repayment thought is understandable. After receiving your undergraduate or graduate degree, your focus is on other things (like building a career).

But if you let that nebulous “later” turn into “never,” the repercussions can be costly. At some point, refinancing your student loans could potentially save you a significant amount of money. You just need to figure out if it is the right move for you.

When to Finance Your Student Loans

1. Your Current Student Loans Have High Interest Rates

Look at the interest rates you’re paying on your student loans, particularly federal Direct Unsubsidized Loans (graduate or professional), federal grad PLUS loans, and/or private student loans.

Depending on how high your loan balance is and how much you could reduce the interest rates by refinancing one or more loans, your cost savings may be significant.

2. Your Financial Situation Has Improved Since You Took Out the Loans

Maybe you were a starving student when you took out federal or private student loans, but ideally your financial situation has improved with time. This is great news for your bottom line, because a higher credit score and income help a borrower qualify for lower interest rates.

If you expect to stay on an upward financial trajectory, you might even consider refinancing to a variable-rate student loan, which will have a lower starting interest rate than a fixed-rate loan. Variable rates are tied to market fluctuations, though, which means rates that are very low today are likely to go up at some point.

The upshot is that a variable-rate loan could be a good option for a qualified borrower who intends to pay off the loan at a relatively fast pace.

3. You Don’t Plan to Use Certain Federal Student Loan Benefits

Borrowers who go to work in the public sector may qualify for the Public Service Loan Forgiveness program. Some federal programs also offer relief for borrowers who experience financial hardships (such as student loan deferment and forbearance, income-driven repayment plans, and the graduated repayment plan).

If you expect your income to be unpredictable or you’re looking into qualifying public service employment, it probably wouldn’t behoove you to refinance federal student loans. But refinancing could make sense if you don’t plan to tap into any of the federal programs listed above and you can gain a lower rate.

Recommended: Looking for more guidance on your student loans? Explore SoFi’s Student Loan Help Center for tips, resources, guides, and more!

4. You’re Going to Take Out a Large Loan

For loans like mortgage loans, lenders will look at your debt-to-income ratio, among other things. DTI is your monthly debt payments per month, including your future mortgage payments, divided by your gross monthly income. A low DTI generally signals better odds of loan approval and better interest rates.

Decreasing your monthly student loan payment by refinancing, with, say, a long loan term, could lower your DTI.

It might make sense to refinance your student loans at least six months before buying a home or making any other large purchase. That will give you time to recoup the points lost after a hard credit inquiry.

Once the mortgage or other big loan has been secured, you could refinance again, this time picking the lender offering the lowest rate, not just the lowest payment. You can refinance student loans as many times as you wish.

If you think student loan refinancing may be a good option for you, the next step is to check out several refinancing providers to compare interest rates and other features.

Refinance Student Loans With SoFi

You can refinance both federal and private student loans into one new loan with SoFi in an easy, all-online process. You can get your rate in two minutes.

SoFi also offers access to an extensive member network through complementary member experiences like happy hours and dinners.

Which means you could gain more than cost savings when you refinance student loans.

FAQ

When should I refinance my student loans?

It might make sense to refinance as soon as you have a stable income and good credit that can usher in a lower rate.

Can I refinance student loans after buying a house?

Buying a home creates new debt, and that can make refinancing student loans more difficult. But by waiting several months or even a year to refinance, the dust can settle on the mortgage decision.

Is refinancing my student loans a good idea?

If you’re struggling to repay federal student loans, you might consider an income-driven repayment plan or federal student loan consolidation.

But if you can qualify, your income is stable, and you would save money by refinancing federal or private student loans, that might be a smart move.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

It may not be a fun thing to think about or talk about, but it’s important to get your estate planning organized. Unfortunately, death doesn’t just happen to other people. We should all get our affairs in order so that our loved ones can focus on grieving and moving on once we pass.

Of course, a “getting your affairs in order before death checklist” may not rank as the ultimate way to kick off a relaxing weekend, but you will rest easy once it’s all said and done. Luckily, it’s not nearly as painful as you might think. It can be less painful than doing your taxes every year. Here, we break it down for you into 12 steps.

12 Estate Planning Must-Haves

Estate planning isn’t just something for retirees or people with multiple homes. All of us need to take this step and determine how and by whom decisions will be made if we are incapacitated or near the end of our life. We also need to funnel our assets to the appropriate people when our time on earth is over.

It can sound grim, we grant you that, but it’s actually a gift to your loved ones to get all of this taken care of. So let us take you through the dozen items to wrangle so you know your affairs are in order.

1. Last Will and Testament

This is super-important because it outlines how your estate (your assets) will be divided. A will is a legal document that serves a couple of important functions. Wills are mainly used to specify how you want to distribute your assets. Assets can include things like personal property, real estate, cars, bank accounts, art, jewelry, or stocks. Despite what some people think, you can give your assets to anyone. You aren’t limited to immediate family. You can even donate your assets to charities or nonprofits if you wish.

A will also ensure that the people you care about are taken care of after you have passed away. If you have any children, a will can name whom you intend to become their guardians if you die. It can also do the same for pets.

You can create a will online using digital tools (you will need it signed and witnessed, though) or work with an attorney, often for under $1,000, to create one.

Recommended: What Happens If You Die Without A Will?

2. Proof of Identity

When the time comes for a will to be put into effect, an executor of the estate plays a crucial role. This individual, who you can name in your will, carries out your will’s instructions. To help this person do their job, make sure you have all of your IDs in one place. Documents you will want to have may include:

•   Birth certificate

•   Social security card

•   Armed forces discharge papers

•   Marriage certificate

•   Prenuptial agreement

•   Divorce certificate

This will make following your directives that much easier.

3. Digital Logins and Passwords

In recent years, our digital lives have become inextricably woven into our “real life.” It’s not uncommon for people to have dozens of digital accounts, containing vital information about our assets. Should you fall ill or suddenly die, your loved ones will likely need to access some of them. For example, you may have financial account information there, and email may be how you interact with some of your closest friends and colleagues. Fortunately, there are many ways to properly document and keep track of your online accounts. Whether you use a digital vault, an integrated password manager, or simply pen and paper, you should establish a system for your loved ones. You can pass this information along to your financial power of attorney to deal with, or you can name a digital executor to close your accounts and distribute your assets.

4. Property Deeds and Titles

Any titles you have for cars, homes, or real estate need to be gathered and put in a safe place. Details on that “safe place” need to be shared with one or two key people in your life, like your next of kin and/or your will’s executor. However, just gathering these items doesn’t mean you can necessarily spare your loved ones the process known as probate. Probate is a potentially complicated and expensive process in which a deceased person’s property is reviewed and allocated. Having a will is of course an important step, but with real estate, for example, things can get complicated even with that document in place. To skip the probate process, you can create a revocable living trust (which is discussed below), and then transfer ownership of your properties to it and list the trust as the current owner.

It’s important to remember that any names on titles or deeds will overrule anything you write in a will. For example, if you bought a car with your ex-wife a few years before you got a divorce and her name is still on the title, it won’t matter whose name you write in your will. She will inherit the car because it is her name that is on the title.

5. Revocable Living Trust

Above, we mentioned the potentially drawn-out and expensive process of probate and why you would want to take steps now to help your loved one’s avoid it later. Let’s drill down on one way to do just that. A revocable living trust is a type of legal instrument that allows you to use and control your property while you’re alive, but also change who inherits it at will. If you have one legally established, it allows all of the assets you entrust to it to skip probate, meaning your beneficiaries can receive your assets much more quickly.

After you’ve created a revocable living trust, you must also name a ‘successor trustee’ to manage your trust. This person will be responsible for distributing your assets to the proper beneficiaries.

Recommended: What Is A Trust Fund?

6. Debts

It would be nice if all debts vanished when our lives ended, but, sorry, that’s not how things work. Your beneficiaries are going to need to know about and potentially address your debts (these are often paid out from your estate before the remaining assets are distributed). To smooth the process, compile a list of all your debts. This may include things like:

•   Auto loans

•   Credit cards

•   Mortgages

•   Personal loans

•   Student loans

On your list include contact information for the lender, your account number, login information, and approximate debt amount. For credit cards, include a list of frequently used credit cards and ones you simply have but rarely use. If you have a lot of open cards in your name, and aren’t quite sure how many you have, you may want to get a free credit report from Annual Credit Report .

7. Non-probate Assets and Beneficiaries

If you have assets that are able to skip probate, meaning they can be transferred directly to the named beneficiaries after you die, then you should keep up to date on naming beneficiaries (say, if a death or divorce has occurred) and keep a list of these assets with account details. Which details exactly? Details like where any paperwork or policies are, account numbers, and contact information for the issuing entity are a good place to start.

Non-probate assets include such things as:

•   Insurance policies

•   401(k) accounts and IRAs

•   Pensions

Non-probate assets should not be listed in your will because any designations you make with each institution will override anything you write anyway.

8. Financials

While you are gathering all of your estate materials, make sure to keep a neat list of all your login and password information for the following:

•   Bank accounts

•   Car insurance

•   Credit cards

•   Health insurance

•   Home insurance

•   Life insurance

•   Loans

•   Pension plans

•   Retirement benefits

•   Tax returns

If everything is online, you may want to make sure every account is listed along with your other digital accounts in your password manager or digital vault.

9. Advance Healthcare Directive

An advance healthcare directive (also known as an AHCD) allows you to decide, in advance, how medical decisions should be made on your behalf if you are unable to communicate your wishes. AHCDs typically have two parts: designating a medical power of attorney (you may also hear this called a healthcare proxy; we share more on this below) and a living will.

A living will describes and outlines your medical care wishes just in case you are ever unable to communicate them to your healthcare providers or loved ones. It can describe any aspect of healthcare preferences, and can include things like:

•   End-of-life requests

•   Medications

•   Resuscitation requests

•   Surgeries and surgical procedures

10. Power of Attorney

This is an important part of putting together your estate-planning checklist. The goal here is typically to make sure that, if you were incapacitated (say, due to dementia or a medical emergency), someone could act on your behalf. When you give someone power of attorney, that person then has legal authority to manage all of your affairs. There are two types of power of attorney: financial and medical.

A financial power of attorney is responsible for:

•   Accessing your bank accounts to pay for healthcare, bills, groceries, and any other housing needs you have

•   Collecting upon any debts you have

•   Filing taxes on your behalf

•   Applying for benefits, such as Medicaid

•   Making investment decisions on your behalf

•   Managing any properties you own

A medical power of attorney (also sometimes referred to as a healthcare proxy) is responsible for:

•   Choosing which doctors or care providers you see

•   Deciding what type of medical care you receive

•   Will advocate if there are disagreements about your care

It’s not uncommon for one person to be designated as both a financial and medical power of attorney, but they don’t have to be the same person. It often provides tremendous peace of mind to know you have designated who will look after your best interests in the situations outlined above.

11. Funeral Wishes

Okay, take a deep breath for this one. It may sound morbid at first, but wouldn’t you want your earthly remains and any celebration of your life to reflect your wishes? So it can make sense to spell out what you want to happen to your body (say, burial, cremation, organ donation).

You can also detail funeral wishes. This typically includes things like what type of music you want to be played or passages to be read, and you can even specify that you want charitable donations instead of flowers.

Whatever you decide, just make sure you communicate your wishes. Unlike other things on this list, there isn’t a formal, legal document you need to sign, but you can usually include your wishes somewhere in your will.

12. Speak with an Estate Planner

Now that you’ve read almost all of this estate planning checklist, you should still consider getting some skilled guidance. Even if you’re completely comfortable writing up legal documents, it’s a good idea to visit an estate planner to make sure you’ve covered all of your bases. He or she may have recommendations for you that can save everyone money and better protect your beneficiaries.

Recommended: Estate Planning 101: The Basics of Estate Planning

The Takeaway

While it can be a difficult topic to think about, estate planning takes time and patience. If you have children, dependents, or a spouse, clear up a weekend and do it as soon as possible. Life happens fast even in the best of circumstances

Estate Planning Made Easier: SoFi and Trust & Will Partnership

Now that you know the steps involved, here’s a super-simple way to approach some of these to-do’s: with a digital estate planning partner. No in-person sales pitches or long phone calls required! SoFi has joined forces with Trust & Will^*, a leading provider, and offers a 10% discount to help you purchase Guardian, Will, or Trust-based estate plans.

Interested in the easy and reliable route to estate planning? Check out what’s offered by SoFi in partnership with Trust & Will.

Photo credit: iStock/Kerkez

^*Trust & Will, a leading digital estate planning platform, is offering a 10% discount specifically for SoFi members. No promo code required. The 10% discount is automatically applied at checkout to the initial purchase of any Guardian, Will, or Trust-based estate plan.
SoFi member benefits are provided by third parties, not by SoFi or its affiliates. Providers pay royalty fees to SoFi for the user of its intellectual property. These fees are used for the general purposes of SoFi. Some provider offers are subject to change and may have restrictions. Please contact the provider directly for details.
Trust & Will 961 West Laurel Street San Diego, CA 92101 United States
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

SOPT1121010

To legally drive in most states, you need to have car insurance, with the minimum amount determined by your state of residence. We should really refer to “car insurance minimum coverages,” in plural, because requirements can exist for liability insurance, property damage, medical expenses, uninsured/underinsured coverage, and personal injury protection, among other possibilities. This post will provide a general overview using the most current information available. Verify information for your particular state to make sure you have the appropriate requirements for car insurance.

Car Insurance Requirements By State

Take a look at Alabama’s requirements for car insurance: 25/50/25. This means that the state requires $25,000 of bodily injury liability insurance per person with $50,000 for all bodily injuries that take place within a single accident and $25,000 in property damage per accident. This is the general format we’ll use while adding other insurance information about a state when available and applicable.

Which States Don’t Require Insurance?

You may notice that two states are not in this list: New Hampshire and Virginia. That’s because they don’t require car insurance, per se, although they do have laws on the subject.

In Virginia, if you don’t have car insurance, you pay a $500 fee, which is more than the average cost of liability insurance in the state.This fee does not, though, provide the driver with any coverage. So they are responsible for any damages they inflict when at fault in an accident and for compensation for any medical injuries and/or property damage.

In New Hampshire, there are no fees associated with not having car insurance but the at-fault driver is responsible for paying for any damages when they are at fault in an accident.

If a driver decides to buy car insurance in either state, then the car insurance minimum coverage in each is 20/50/25.

Recommended: How to Get Car insurance in 5 Simple Steps

Understanding Required Coverages

Here are definitions for key auto insurance terms connected to coverages:

•   At fault: A driver is “at fault” when an action they took or didn’t take caused the collision.

•   Liability insurance: This pays for the other driver’s/drivers’ car repairs (property damage) and medical bills (bodily injuries) if you’re at fault in an accident.

•   Uninsured and underinsured motorist coverage: This protects drivers and passengers alike if the other motorist has little or no car insurance. The bodily insurance portion covers medical costs while the property damage portion pays for vehicle repairs.

•   Personal injury protection: This helps to pay for accident-related medical expenses for the insured driver and the passengers, regardless of who is at fault.

Liability auto insurance may also cover loss of income, legal fees if a lawsuit occurs, and/or funeral costs. The property damage coverage can go beyond paying for vehicle repairs, also covering a fence, bicycle, shed, or building — as just four examples — that was damaged in an accident.

Exceptions to State Minimum Car Insurance Requirements

As already described, New Hampshire and Virginia take a different approach to car insurance requirements. As another approach, in the state of Kentucky, a driver can have 25/50/25 coverage or a policy with a $60,000 limit. In Maine, as another example, you can have the menu of coverages as described above or a $125,000 policy. Because each state is different, it’s best to verify what insurance is required by law where you live and what options exist.

In more than half of the states, a driver can decide to purchase a bond from the state instead of buying car insurance. Specifics vary by state (but none of the bond amounts are small) and these funds are used if you cause an accident. Any time that the state pays an injured party (from an accident where you are at fault), the money must immediately be reimbursed by you to the state along with interest. The bond is connected to the driver, not the vehicle, so it provides coverage to any vehicle driven by the bondholder.

Recommended: How Does Car Insurance Work?

Going Beyond Car Insurance Minimum Coverage

So far, this post is focusing on what insurance is required by law. But how much car insurance do you really need? That’s another question entirely.

For example, even when your state doesn’t require comprehensive coverage, if a vehicle is being financed or leased, the lender will likely require that you have this type of coverage. This covers physical damage to a vehicle that isn’t caused by an accident. This can include weather damage, theft or vandalism, hitting an animal, and other damages. Even if a vehicle is paid off, it often makes sense to include this coverage in your policy because the cost is small in comparison to what repair or replacement costs would be if the vehicle is damaged or stolen.

Collision coverage goes beyond accident-related damage and can cover costs if you run into a tree or building, hit a pothole, for example. If paying for damages out of pocket would be challenging or your risk tolerance is low, you might consider having this coverage.

Then there’s guaranteed auto protection (GAP) that can protect you as your vehicle’s value depreciates. If that car is totaled in an accident or stolen, then GAP would pay the difference between what you owe on it and its actual cash value. This allows you to pay off your loan or lease and then get any remainder from the insurer. Typically, you need full auto insurance in order to add the optional GAP.

Lowering Car Insurance

To lower your car insurance, here are tips to consider:

•   Get quotes. Using an online comparison tool can make your search especially efficient. The Insurance Information Institute recommends that you get at least three quotes. To check out the insurer’s financial health, you can use Standard & Poor’s, AM Best, or another rating service — and/or contact your state insurance department to see if there are any complaints about them.

•   Talk to your current insurance provider and ask them what discounts they can offer you. They may give you a better premium to keep your business.

•   See which discounts you may qualify for: a good driving record, a vehicle with anti-theft features, carpooling/remote working, going paperless with statements, or other strategies.

•   Find out how much you can save if you bundle other insurances with your car insurance. This can be homeowners or renters insurance, for example, or perhaps you can combine car insurance policies for multiple vehicles.

•   Consider a higher deductible, which is the out-of-pocket amount you’d have to pay before your insurance kicks in to pay a claim. This can lower your premium significantly, but if you have an accident, you may need to use your personal savings before the insurer pays your claim.

•   Reevaluate coverage needs. If your car is older, you may not need all of the coverages you once did. That said, you’ll want to balance what you can save today on premiums with what might happen tomorrow if an accident or other covered event occurs. You’ll need to keep state minimum car insurance in mind, of course.

The Takeaway

Most states have minimum requirements for car insurance (and when they don’t, they still have coverage parameters that must be met). This post shares insight into the types of coverages as well as the amounts that each state requires. To find the right insurance policy for your needs, you can compare multiple car insurance rates from top insurers and see quotes in just a matter of minutes.

Photo credit: iStock/Weekend Images Inc.

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

¹SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc’s service. Vehicle Identification Number is confirmed by LexisNexis and car values are provided by J.D. Power. Auto Tracker is provided on an “as-is, as-available” basis with all faults and defects, with no warranty, express or implied. The values shown on this page are a rough estimate based on your car’s year, make, and model, but don’t take into account things such as your mileage, accident history, or car condition.

Insurance not available in all states.
Gabi is a registered service mark of Gabi Personal Insurance Agency, Inc.
SoFi is compensated by Gabi for each customer who completes an application through the SoFi-Gabi partnership.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

This article is not intended to be legal advice. Please consult an attorney for advice.

SOPT1021004

If you’re thinking, ‘Do I need a will?’ chances are, the answer is yes. Thinking about a will can feel morbid and unnecessary, especially when you’re young, healthy, and still growing your wealth. And it’s true that not everyone needs a will, especially if you’re single and growing your worth. What’s more, because the term “will” can be used to encompass end-of-life directives, it can confusing to know exactly what people mean if they say, “You should have a will.”

So, we’re here to clarify the topic. Read on to learn exactly which documents are needed if the worst were to happen and you were unable to make your end-of-life wishes known.

What Does a Will Really Do?

Simply speaking, a will dictates what will happen to your assets when you die. It can also be used to provide direction for who will care for any children and pets you have. Without a will, your property will be passed on according to state law, which means that your belongings may go to your spouse or nearest surviving relative, like a parent or sibling.

In some cases, this can be fine. But for people with children or people who own a home, this may not be ideal. Not only that, but dying without a will may put a burden on surviving relatives, leading to a costly and complex process.

In short, a will can communicate your wishes. For instance, it can:

•   Dictate who the executor (the person who administrates the will) is

•   Make a plan for how property will be distributed

•   Make a plan for how children or pets will be cared for

•   Make a plan for how debts and taxes will be paid

Creating a will does not need to be a long and complicated process. But it does need to be legal. While handwritten wills are acceptable in some states, they may be subject to additional scrutiny and may still need a signed witness to be valid.

Recommended: How To Make a Will: 7 Steps

What Does a Will Not Cover?

Let’s review some terms to see what different documents do:

•   A simple will determines what happens to your assets after you die.

•   A living will and other advance directives dictate what may happen if you were incapacitated and unable to make medical decisions. Both can be drawn up at the same time. These are legal documents that spell out medical treatments you would and would not want to be used to keep you alive. It typically communicates your preferences about other decisions, such as pain management or organ donation. In addition, if you have very specific wishes about whom you want to make financial and healthcare decisions if you were to be incapacitated, a living will can document those. This can be helpful if, for example, you’re not married but would want your partner (and not your parents) making these decisions if you were unable to make them yourself.

The guidelines and requirements for creating these documents can vary state by state. Attorneys, as well as online planning templates, can provide the documents to cover all potential end-of-life what-ifs, including creating a living will and advance directive, as well as a standard will to cover all bases.

Recommended: What Happens If You Die Without A Will?

When Do You Need a Will?

In a nutshell, you need a will if you have a spouse, children, or considerable assets. A will can take the guesswork out of matters if you were to die and can avoid legal complications.

Even if your life is relatively “simple” to unpack, a will can ensure there are no uncertainties and that your survivors are crystal clear about your wishes. Some times to consider a will:

•   When you want to leave things to family and friends. These may not be valuables but could be meaningful, sentimental items

•   When you own property

•   When you have a spouse and/or children

•   When you want to provide to a charity

•   When you have a positive net worth

•   When you have a complicated financial picture

In short, a will can help answer any questions your survivors may have, simplifying a process that may be emotion-filled. It can also help provide peace of mind that if you were to die, your loved ones will have a road map.

Are You Married? You Need a Will

You may think a will isn’t necessary if you’re married. After all, your assets will simply go to your spouse, right? It’s not that simple. State laws do differ. Typically, but not always, spouses, domestic partners and blood relatives are first in line when it comes to receiving inheritance. Having a will ensures that you direct where you want your estate to go, protecting the interests of those closest to you.

Another issue comes up when you pass away without a will, which is known as being intestate: the state gets involved in a potentially lengthy process called probate. A court-appointed administrator will identify legal heirs and determine how your estate is divided and bills are paid, according to the laws of your state. This can make for a complicated situation in which your spouse must wait for an inheritance, potentially causing financial hardship.

There’s another reason why a will is valuable if you’re married. It’s likely you and your spouse will create what’s known as a mutual will (these should be created with a lawyer’s help). After one partner dies, the remaining party is bound by the terms of the mutual will. This kind of document can, for example, be used to ensure that property gets passed to the deceased’s children rather than to a new spouse. In this way, a will can smoothe family dynamics in the future and ensure that your wishes are followed.

Recommended: Joint Will: What Is a Mutual Will?

Do You Have Kids? You Need a Will

One motivating factor for creating a will is when a couple has children. A will not only allows you to choose a guardian for your children, but it also allows you to name a guardian for your children’s finances — and they don’t necessarily need to be the same person.

It’s important to create a will even if the assumption is that the child’s other parent will look after the children. Not only can a will provide a template for a what-if situation if both parents were to pass away, but it can also ensure that your children will receive the share of your estate that you desire when they’re older.

Having a will can minimize disruption in case the worst were to happen and one or both parents were to pass away. If there is no will, the court will decide, and while the court will keep the best interests of the children in mind, the parents are the ones who know the kids best and may have the best solution.

In short, a will allows you to make sure:

•   Children are cared for by the people you wish

•   Children’s finances are cared for by the people you wish

•   Adult children will receive the inheritance you desire them to have

•   Any unique circumstances regarding child care is taken into account

Do You Have a Positive Net Worth? You Need a Will

Even if you’re single, a will may make sense if you have a positive net worth (aka, more assets than debt), which may include owning a house. Depending on your net worth, you may consider creating a trust. This can help your family avoid the probate process.

You can also be very specific about how you want your assets allocated in the future. For example, you may want to provide gifts to charity upon your death.

You also want to check your beneficiaries for any accounts, including retirement accounts and life insurance policies. The named beneficiary takes precedence over who’s named in a will, so it can be a good idea to double check that the named beneficiary is the person you want to receive those assets.

Are You Young, Single, Asset-free, or Without Kids? You Don’t Need a Will (Yet)

While you may not need a will if you don’t have any dependents, property, or assets, it’s still worth thinking through what you do own. For example, if you have a life insurance policy or retirement account, make sure the beneficiary you name matches who you would want to have those funds as time passes.

But a will can ensure there is no confusion over your wishes, especially if you have pets to be cared for or mementos you know would be meaningful to the people in your life.

How to Set Up a Will

A 2021 survey of over 2,500 people from Caring.com, a caregiver website, found that the past year made more people realize the importance of having estate planning documents. However, 2 out of 3 people don’t yet have a will. One big justification: Not enough time to create a will.

However, creating a will does not need to be complex. Online templates can walk you through the process. An online template may be free or may cost $100 and up, depending on the complexity. More expensive templates may be state-specific and detailed.

One critical aspect: Make sure the will is legal in your state. This may mean the will needs to be notarized and signed in front of witnesses. Once you have a will completed, it can be a good idea to make several copies and let the person you’ve named executor know where they can find the will in case you were to die.

If you have multiple, complex assets (such as several jointly-owned properties or properties jointly-owned with different people) you may need an attorney. This may cost $1,000 and up but can give you the peace of mind that everything is covered.

The Takeaway

While creating a will may not exactly be a fun activity, it doesn’t need to be very time-consuming or expensive. It’s an important process that can deliver some valuable peace of mind for the future. It lets you know your “house is in order,” and that your wishes are clearly captured. With a will in place, your worldly goods go where you want them to go, and you ensure that loved ones are taken care of in the way you see fit. When you get these documents done, you’ll also save those nearest and dearest to you from having to deal with legal red tape during an emotionally challenging time. Yes, death and wills are a topic many of us would like to avoid. But being pragmatic and taking care of this important legal concern is the right, responsible step to take.

The Simple Way to Protect Loved Ones: SoFi and Trust & Will

To help you with this important process and make sure it isn’t arduous, SoFi has partnered with Trust & Will^*, the leading online estate planning platform in the U.S. — to give our members 10% off their trust, will, or guardianship estate plans.

Photo credit: iStock/evgenyatamanenko

SoFi member benefits are provided by third parties, not by SoFi or its affiliates. Providers pay royalty fees to SoFi for the user of its intellectual property. These fees are used for the general purposes of SoFi. Some provider offers are subject to change and may have restrictions. Please contact the provider directly for details.
^*Trust & Will, a leading digital estate planning platform, is offering a 10% discount specifically for SoFi members. No promo code required. The 10% discount is automatically applied at checkout to the initial purchase of any Guardian, Will, or Trust-based estate plan.
Trust & Will 961 West Laurel Street San Diego, CA 92101 United States
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

SOPT1121004

With gasoline and home heating oil prices surging since the Russian invasion of Ukraine, consumers are looking for ways to cut their gas bills.

Crude oil prices have risen to their highest level since 2014 amid the war in Ukraine, which began in February 2022 — and has no clear path for a ceasefire in sight. Gasoline and heating oil are some of the petroleum products derived from crude oil, so higher gasoline and heating oil prices may be around for some time.

Fortunately, motorists and homeowners can save money on gas by embracing energy-efficient practices. Here are some of the easiest ways to reduce the pain both at the pump and when paying for heating costs.

15 Ways to Pay Less for Gas for Your Car and Home

Here are 15 ways you can pay less on fuel for your car and home heating system:

1. Follow the Speed Limit

Following the speed limit can help you save money on gas. In general, gas mileage decreases rapidly as you accelerate above 50 mph. Driving 55 mph rather than 65 mph can improve your gas mileage by 15%, according to the U.S. Environmental Protection Agency.

2. Avoid Aggressive Driving

Aggressive driving, including speeding and rapid acceleration, can lower your gas mileage by 33% on the highway and by 5% on city roadways. Motorists who avoid aggressive driving can realize cost-savings by burning less fuel on roads and highways.

3. Remove Unnecessary Weight

Removing unnecessary weight from your vehicle can save money on gas. Storing an extra 100 pounds in your vehicle could reduce your miles per gallon by up to 2%, according to the U.S. Department of Energy.

4. Use Cruise Control on Highways

Using cruise control on highways can help you save up to 14% on gas by maintaining a continuous speed. Constantly accelerating and decelerating burns more fuel, which gives you less bang for your buck on the road.

5. Keep Tires Properly Inflated

Keeping your tires properly inflated can improve your gas mileage by 3%. Conversely, driving with underinflated tires can decrease your gas mileage by 0.3% for each unit drop in pounds per square inch (psi) of air pressure.

6. Stick With Regular Gasoline

Gasoline prices vary by their octane level, with regular being the cheapest and premium being the most expensive. Unless your car requires premium fuel, you can save money by sticking with unleaded regular gasoline as opposed to choosing midgrade or premium alternatives.

President Joe Biden has predicted gas prices will go up further as a result of Russia’s invasion of Ukraine. The potential for crude oil prices to continue rising may motivate some observers to invest in energy stocks. Others may see this as an ideal time to invest in utilities.

7. Don’t Idle When Parked

Allowing your car engine to run idle while parked is wasteful. Idling can consume up to half a gallon of fuel per hour, according to the U.S. Department of Energy. You can save gas money by turning off your car when it’s parked.

8. Search Online for Cheapest Fuel Stations

Some gas stations may offer cheaper fuel than other gas stations in your geographic area. You can search online for the cheapest gas stations in your area. Websites or apps like GasBuddy can help you find the lowest gas prices in your city or town.

9. Reduce Aerodynamic Drag

Your vehicle has to overcome wind resistance or aerodynamic drag whenever you drive it in the open. Reducing aerodynamic drag can save money on gas, and motorists can reduce aerodynamic drag by driving with the windows closed.

10. Minimize A/C Usage

Minimizing your vehicle’s air conditioner usage can save gas money. Using the air conditioner in some cases can reduce your vehicle’s fuel economy by more than 25%, which is akin to paying more at the pump over time, according to the EPA and U.S. Department of Energy.

11. Clean or Replace Air Filter as Necessary

Cleaning or replacing your vehicle’s air filter as necessary can save gas money, particularly if you’re driving an older vehicle manufactured before 1980. Older vehicles may feature a carbureted engine that becomes less fuel efficient when operating with a clogged air filter, according to the U.S. Department of Energy.

12. Get Engine Tune-Ups as Needed

Getting engine tune-ups as needed can improve gas mileage by an average of 4%, according to the U.S. Department of Energy. An engine tune-up is a comprehensive inspection that determines whether any components of the engine need to be replaced.

13. Consider New Vehicle Options

You can consider buying a new or used vehicle with better gas mileage to save money on gas. Consumers can also consider buying all-electric vehicles to move away from gasoline and diesel fuel entirely.

14. Insulate Your Home

Homeowners can save up to 15% on heating and cooling costs by air sealing their homes and adding insulation in attics and other areas of the home, according to the EPA. This could be a worthwhile investment considering how the Ukraine invasion may affect oil, gas, and clean energy investments.

15. Lower Your Thermostat

Homeowners can save money on their home heating bills by setting their thermostats to 68 degrees Fahrenheit. The Delaware Public Service Commission says you can save 5% on your home heating costs for every degree you lower your thermostat below 70.

Considering the global economy and looking at oil and natural gas to understand Russia-Ukraine, homeowners in the New England and Mid-Atlantic states may consider thermostat adjustments as a cost-saving measure.

The Takeaway

The price of gasoline and heating oil may stay at its high level – or even rise as the conflict in Eastern Europe continues. Feeling the pinch in their wallets, consumers may want to try changing their habits and practices to be more energy efficient.

Another simple way to save money on gas is to pay for it using a credit card that offers cash back. [cc_three_percent]

Photo credit: iStock/ADragan

[three_percent_disclaimers]

¹See Rewards Details at SoFi.com/card/rewards.


Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.


SOCC0322021