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What to Look for In Your Homeowner’s Insurance Policy

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Homeowner’s Insurance Policy

If you’ve been a renter for most of your adult life and you recently bought a home, making the switch from a renter’s policy to a homeowner’s insurance policy may seem daunting. Now it’s about more than just your possessions — if something breaks or goes awry in your home, it’s totally up to you to fix it … but will your homeowner’s insurance help bail you out?

When doing your research there are some important things to keep in mind. If you’re currently shopping around for a homeowner’s policy that’s right for you, be sure to check on the following points to see if they’re included:

1. Are all of your possessions covered, and under what circumstances?

The whole point of having homeowner’s insurance is to safeguard your possessions and your overall home from certain environmental hazards and vandalism so that if something were to happen, you aren’t held liable for replacing everything at full value. In actuality, though, your homeowner’s policy will come with certain restrictions and stipulations in terms of what they’ll cover you for. For example, most common policies should cover you for any damage to either your possessions or your property in events like storms, fire, theft or vandalism. Get all the details on what events your policy will cover you for before signing up. A good policy should also provide you with shelter costs in the case of an emergency as well, so if you are temporarily displaced from your home because of a flood or fire, the insurance should foot the cost of a hotel bill.

2. What isn’t covered?

It’s fine and dandy to listen to a list of hazards for which your possessions are covered, but it’s always a good idea to keep in mind some of the environmental hazards that might be missing from your policy list. For example, depending on where you live in the country your policy might cover you for windstorms, but if your area is prone to tornadoes, you might consider paying for some additional coverage to be sure you’re safe. On the flip side, some companies actually exclude tornadoes and hurricanes from policies in high-risk areas, so you’ll definitely want to be sure you know the details of what your policy does and doesn’t cover as it relates to the typical weather in your area. Water damage is another big one to check in on. Do your research to find out if flood damage or earthquakes, etc., are common in your area, then make sure your policy has you covered (it typically isn’t) and check to see if additional coverage in this area might benefit you, as well.

3. What is the liability coverage like?

As a homeowner, you’ll also be responsible should someone injure themselves on your property and decide to sue. Check with your homeowner’s policy to make sure you’re being provided with liability coverage in case this happens to you.

4. What happens when your possessions are traveling?


Just because your policy is a homeowner’s policy doesn’t mean that you stuff should necessarily always be in your home to be covered. Whether it’s an item that was stolen from your car or a laptop bag that was lost in transit, find out if your policy covers your items when they’re outside of your home, as well.

5. Beware of bugs and infestations


You’d be hard-pressed to find a homeowner’s policy that covers things like bedbugs and termites, since most companies just consider dealing with this type of thing par for the course of owning a house. There’s really not much to be done about it, other than to recognize that these things aren’t covered, and to start saving up in a separate savings account for any household things that might go wrong that you’ll have to pay for out of pocket.

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Survey Reveals How Consumers Will Spend Stimulus Money: Groceries, Bills and Savings Top the List

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

In the face of the coronavirus pandemic, many Americans are dealing with furlough, unemployment, reduced pay or climbing health care costs. To offer support, Congress has passed a historic $2 trillion relief package that includes direct payments for eligible Americans.

With millions of taxpayers slated to receive relief checks in the coming weeks, many are making plans for how to spend the unexpected windfall. A new survey from MagnifyMoney of more than 1,000 Americans reveals that for most, the relief check is a necessity. Nearly half of survey respondents said they plan to use the money on essentials like groceries and bills, underscoring the current fragile state of Americans’ finances.

Key findings

  • We asked consumers how they’ll spend their stimulus check, should they receive one. The top two responses were paying for groceries and paying for bills. Additionally, 44% plan to save at least some of the money.
  • The checks are a necessary reprieve for most of the survey respondents, as nearly 7 in 10 (69%) said they need the stimulus money. Another 26% said that while they don’t necessarily need the money, it will help. Just 6% said they don’t need it.
  • While many said the check will help, they aren’t necessarily certain it will be enough. Most of our respondents (40%) said the stimulus check will relieve “a few” of the difficulties they’ve been facing, while 10% said they’ll still be experiencing a significant level of financial difficulty. The good news is that 18% said the stimulus money will remove all of the difficulties they’re facing due to the pandemic, and another 17% said it will alleviate most financial difficulties.
  • Consumers are split in terms of satisfaction with the monetary value of the stimulus checks. About 41% think the check amount is “just right,” though 39% think it’s too small. Only 4% thought the amount was too large.
  • About half (49%) of respondents agree with the income limit proposed by the government. However, 21% think the threshold should be lowered so that higher income individuals would receive even less. On the other hand, 11% said there should not be an income limit.
  • Some will have to wait longer than others to receive their funds. About 8% of our survey respondents don’t have a bank account, which would slow down the time it takes for them to have access to those funds because they’ll be waiting for a check to arrive in the mail instead of the funds being direct deposited in their bank account. Meanwhile, less than 60% have direct deposit set up with the IRS.
  • Nearly all consumers we surveyed (85%) think the government’s plan is a good idea. The intention of the stimulus checks is to help counter the negative financial and economic impacts of coronavirus.

How Americans are spending their stimulus checks

Our survey found that the stimulus checks, being distributed as part of the coronavirus relief package, are acting as a safety net for many Americans. When we asked respondents what they plan to spend their stimulus check on (they could select all answers that applied), the top two answers were to pay for groceries (45%) and to pay for bills (43%).

Meanwhile, we found that 29% of respondents plan to use their check to make their rent or mortgage payment, 26% are going to put some of it in savings and 18% plan to put all of the money in savings.

Generational and income-level differences in stimulus check spending

When looking at how different generations intend to spend their relief checks, we found that millennials were more likely than any other generation to say that they plan to use their relief check to pay for bills (49%) and to pay their rent or mortgage (37%). Understandably, the youngest generation — Gen Z — was the age group most likely to plan to use their relief check to pay off student loans (11%). They were also the generation most likely to put either all of their check in savings (21%) or most of it (39%).

Our survey also revealed that households with lower incomes were, for the most part, more likely to use their relief checks to pay for necessities, such as groceries, bills or housing costs. Meanwhile, we found that 7% of households that make $100,000 or more annually plan to donate their entire relief check to charity or someone in need.

Americans that need stimulus checks the most

Overall, our survey revealed that the relief checks are much needed, with 69% of survey respondents saying that they personally need the financial assistance. That’s in comparison to 26% of respondents who said that they don’t really need the check but that it will help and just 6% who say they don’t need it at all.

Across all generations, the overwhelming majority of respondents said they indeed needed the relief payment. However, Gen Zers were far more likely to say that they didn’t need the relief check (10%) compared to millennials, Gen X and baby boomers. One possible explanation for this could be that Gen Zers could have parents or other older adults supporting them financially. Not surprisingly, our survey also found that households with less than $25,000 in annual income were far more likely to say they needed the relief check (80%), compared to 50% of households that make $100,000 or more.

Of survey respondents who said they did not need the relief check, nearly half (45%) said they still do not feel guilty about receiving one. However, 10% of those who said they do not need the check admitted to feeling guilt over receiving the check and plan to donate it. Another 10% that feel guilty, though they still intend to use their check. Meanwhile, 35% of respondents who said they don’t need a check don’t expect to receive one — which are likely people who make too much money to qualify.

Do Americans think the stimulus checks are enough?

While Congress moved swiftly to provide relief to families facing financial turbulence, our survey found that many Americans (39%) do not think the checks are enough. The checks are for up to $1,200 per eligible adult and up to $2,400 for couples filing joint returns, with an additional $500 per child under the age of 17.

Though many are dissatisfied with the amount of the checks, 41% of Americans think that the amount of the stimulus checks is just right. Another 4% even said that the amount is too much.

As for the income thresholds that apply to the relief checks — which start at $75,000 for individuals and $150,000 for jointly filing married couples — nearly half (49%) of survey respondents said that they agree with the U.S. government’s decision to implement income thresholds as well as with the income limits they chose. Another 21% agreed that there should be income limits but thought those limits should be lower, while 9% thought the limits should be higher. In contrast, 11% said that there should not be an income limit at all.

As a glimmer of good news, our survey found that the majority of respondents (74%) said that the relief checks will help relieve either some or all of the difficulties they’ve been facing as a result of the coronavirus pandemic. However, 10% of respondents said they will still be facing a significant level of financial difficulty despite the relief check.

When will the stimulus checks go out?

On March 30, the IRS announced that payments will be disbursed within the next three weeks. Those who chose to receive their tax refund via direct deposit, as opposed to mailed checks, can expect to receive their relief check faster.

If you did not share your bank account information with the IRS when filing your taxes, the Department of the Treasury plans to open an online portal that will allow you to share your direct deposit information with the IRS, enabling you to get your relief check faster.

What you should do with your stimulus check

While our survey’s findings revealed that many taxpayers already plan to spend their stimulus checks on necessities like bills and groceries, some might feel uncertain about how to prioritize competing financial needs. Matt Schulz, the chief credit analyst for LendingTree, acknowledges there is no one-size-fits-all answer when it comes to how people should use their stimulus checks, but says it’s important to carefully plan what you do with it.

“If you can put some of the check away to start an emergency fund or build up your current one, that’s probably ideal,” Schulz said. “That’s not reality for millions of Americans, though. For many, this will be about keeping the lights on or putting food on the table. That’s why these checks are so, so important.”

If you’re focused on using your check to demolish debt, Schulz emphasizes the importance of having an emergency fund in place as well. “It’s obviously great to pay down debt, but far too often, people pay off debt and have no savings at all,” Schulz said. “That means that if an unexpected expense comes up, that cost goes right back on the credit card and the person is right back in debt. Having even a little bit of cash in savings can help avoid that situation.”

If you’re on good financial footing, Schulz points out a number of good uses for that money, including:

  • Growing your rainy-day fund
  • Paying off credit card debt
  • Bulking up your retirement savings
  • Supporting your community by spending on small businesses or nonprofits

Methodology

MagnifyMoney commissioned Qualtrics to conduct an online survey of 1,038 Americans, with the sample base proportioned to represent the overall population. We defined generations as the following ages in 2020:

  • Gen Z: 18 to 23
  • Millennials: 24 to 39
  • Gen X: 40 to 54
  • Baby boomers: 55 to 74
  • Silent generation: 75 and older

The survey was fielded March 26-27, 2020.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

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Places Where Taxpayers May Wait Longer for Their Stimulus Checks

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

The CARES Act stimulus checks may offer some relief to taxpayers amid the coronavirus outbreak, but distribution may pose a problem for the millions who don’t use direct deposit to receive their tax refunds. In 2019, 19.8 million taxpayers waited longer for their tax refunds to arrive via paper check. Today, these same taxpayers will have to wait longer again — potentially up to an additional three months — for their stimulus checks.

MagnifyMoney looked at the 100 largest metro areas in the U.S. to determine where taxpayers used direct deposit the most (and least) to receive their 2018 tax refund. Cities with the highest percentages of check-receiving taxpayers are where people will likely wait longer for financial relief to arrive.

Key findings

  • Visalia, Calif., has the highest percentage of taxpayers that will have to wait a little longer for their relief rebates. About a quarter of taxpayers there (25.9%) didn’t use direct deposit to receive their tax refunds in 2018.
  • Fresno, Calif., isn’t far behind — 23.4% of taxpayers there will likely have to wait longer for a check.
  • While Visalia has the highest percentage of check-receiving taxpayers, the New York City metro area, which ranks 11th, has the highest total number of taxpayers who received a check refund in 2018. Approximately 1.78 million taxpayers in the New York City area may have to wait for a paper relief check, compared with the 46,330 taxpayers in Visalia.
  • Oklahoma City and Tulsa, Okla., were the only two cities out of all the metro areas we looked at where the percentage of check-receiving taxpayers was under double digits. Only 9.8% of taxpayers in Oklahoma City and 9.6% of taxpayers in Tulsa didn’t use direct deposit to receive their tax refunds in 2018.
  • When it comes to the actual number of taxpayers waiting the longest for their stimulus checks, our 93rd-ranked metro area of Davenport, Iowa, has the smallest number of check-receiving taxpayers. In Davenport, 21,690 taxpayers will wait longer, or 12.2% of the metro area’s tax-paying population.

Where taxpayers may have to wait longer for their stimulus checks

On the map below, you’ll find the 100 largest American metro areas ranked in order of highest to lowest percentage of taxpayers who opted to receive their 2018 tax refund by check. The places ranking highest on the list are where taxpayers are most likely to experience delays receiving stimulus payments, given the lag in getting a paper check in the mail compared with money that’s direct deposited into your account.

Taxpayers in California are more likely to be left waiting for their stimulus checks, with half of the top 10 metro areas located in the Golden State. This includes Visalia, Fresno, San Jose/San Francisco, Modesto and Sacramento.

The cities in the bottom 25 — where the lowest percentages of taxpayers within the 100 largest metro areas received refunds by check — are scattered among states in the South and Midwest. Tennessee taxpayers, in particular, seem well-positioned to receive their relief payments quickly — four metro areas in the bottom 15 are in Tennessee, including Chattanooga, Nashville, Johnson City and Knoxville.

What to do if you didn’t use direct deposit

If you’re one of the millions of U.S. taxpayers who don’t use direct deposit for your tax refunds, there are some actions that you can take and options available to ensure you receive your economic impact payment sooner rather than later.

1. File your 2019 tax return as soon as possible

The IRS will distribute these economic impact payments according to the information on taxpayers’ 2019 or 2018 tax returns, whichever is most recent. They will pull your income information as well as your payment method, whether that is direct deposit or paper check. You will need a valid Social Security number to be eligible for the payment.

If your information has changed since your 2018 tax return, it’s best to file your 2019 taxes before the IRS starts automatically sending out payments within the next three weeks. Expediting your filing is even more beneficial when you’re expecting a tax refund, which can provide some extra cash relief. However, the federal tax return deadline has been extended to July 15, 2020.

Individuals who typically don’t have to file a tax return do not need to file a simple tax return to receive the rebate. Instead, the IRS will pull information from Form SSA-1099 or Form RRB-1099 to determine benefits for senior citizens, Social Security recipients and railroad retirees. If you do not typically file a tax return but do not use those forms, you may want to file a simple tax return anyways.

2. Provide your banking information to the IRS online

The U.S. Department of the Treasury is expected to release an online portal “in the coming weeks” for individuals to provide their banking information to the IRS. This will allow you to easily update the IRS on any changes to your banking information.

You can check the IRS’s coronavirus information page for the latest updates.

3. Open an online bank account

Unfortunately, the reality in the U.S. is that about 8.4 million households don’t even have a checking or savings account into which they can direct deposit their tax refund according to the 2017 FDIC National Survey of Unbanked and Underbanked Households. These tend to be lower- or volatile-income households, meaning those already vulnerable and at-risk households may have to wait longer for the government’s stimulus payments to arrive.

If you or someone you know does not have a bank account, consider opening an online bank account so you can more quickly benefit from the stimulus payments. Online bank accounts are less likely to charge monthly service fees, which is often a reason why households are unbanked in the first place. Online savings accounts are also more likely to pay more in interest, which means your money grows while staying safe inside the account. Plus, opening an online bank account doesn’t involve visiting a bank branch, so you can maintain social distancing.

If you’re having trouble opening a traditional bank account due to a rocky financial past, second chance bank accounts are made to help you get back into the banking world. Issuers of these accounts have less strict background requirements, which opens up the opportunity to continue banking even if you have a history of account closures. These accounts are more likely to come with fees, however, which helps issuers cover potential losses.

Methodology

In March 2020, MagnifyMoney examined local-level 2018 tax filing season data from the IRS to identify where taxpayers in each of the 100 largest metros were more and less likely to receive their tax refunds by direct deposit.

For more information on the rest of the stimulus package, refer to our hub page.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.