Kiplinger's Personal Finance

go ahead, have a latte

Earlier this summer, the Twittersphere was ablaze when CNBC tweeted out a video in which Suze Orman, the tough-love personal finance guru, excoriates millennials who buy coffee every morning. She claims that the daily ritual of going to Starbucks or Peet’s or wherever they get their caffeine fix and paying $1 to $3 a pop endangers their retirement. It is the equivalent of “peeing a million dollars down the drain,” she says. (You can watch the video at CNBC’s “Make It” YouTube channel.) Suze’s style is in-your-face, preachy and prescriptive. In the video, she says coffee you don’t brew at home is a “want,” not a “need”—which is true, but she taunts her audience. “I would not insult myself by wasting money that way,” she shouts at the camera. “And I…

we’re in the money

I was disappointed when Money announced it would no longer produce a print magazine—but as a communications professional, I understand the pressures and realities of the digital age. I, too, prefer my print version to carry on business travel or read by the pool. I look forward to devouring your issue as much as (and hopefully more than) I enjoyed reading Money—and continuing to master my financial literacy and the freedom that comes with that preparation. DIANNE BAUMERT-MOYIK MELBOURNE, FLA. Your “From the Editor” column in the August issue was an honest overview of the personal finance industry, a great tribute to your former competitor and a hopeful sign for those of us who still like print! MICHAEL CONFIELD WEST POINT, N.Y. You’re fired! When I hired my adviser, we agreed on a 1% fee of…

kiplinger's personal finance

EDITORIAL EDITOR Mark K. Solheim EXECUTIVE EDITOR Anne Kates Smith MANAGING EDITOR Frederic Fane Wolfer SENIOR EDITORS Eileen Ambrose, Sandra Block, Jeffrey R. Kosnett EDITOR AT LARGE Janet Bodnar SENIOR ASSOCIATE EDITORS Nellie S. Huang, John Waggoner, Marc A. Wojno (research) ASSOCIATE EDITORS Miriam Cross, Ryan Ermey, Patricia Mertz Esswein, Kaitlin Pitsker STAFF WRITERS Brendan Pedersen, Rivan V. Stinson CONTRIBUTING EDITORS Lisa Gerstner, James K. Glassman COPY EDITORS Rachel McVearry, Denise E. Mitchell INTERN Sabrina Medler ART DESIGN DIRECTOR Stacie A. Harrison ASSOCIATE ART DIRECTOR Yajaira St. Fleurant ASSISTANT ART DIRECTOR Natalie F. Kress EDITORIAL PRODUCTION MANAGER Kevin Childers ADVERTISING SALES ASSOCIATE PUBLISHER AND NATIONAL SALES DIRECTOR Paul Vizza (202-887-6558; pvizza@kiplinger.com) SALES DIRECTOR Jim Marron (917-621-6627; jmarron@kiplinger.com) DIRECT RESPONSE Anthony Smyth (914-409-4202; anthony@smythmedia.com) ONLINE SALES DIRECTOR OF DIGITAL OPERATIONS AND ADVERTISING Andy Price (aprice@kiplinger.com) REGIONAL ACCOUNT MANAGERS Maggie Kinsky (mkinsky@kiplinger.com), Stevie Lee (slee@kiplinger.com) DIGITAL ADVERTISING CAMPAIGN MANAGER Neshmia Tahir KIPLINGER.COM GENERAL MANAGER Robert Long EXECUTIVE EDITOR…

are you covered for the next disaster?

FEDERAL WEATHER FORECASTS have predicted a “near normal” number of hurricanes for the season that ends November 30. That’s small consolation, though, if you find yourself in the path of one of the nine to 15 named storms predicted to form in the Atlantic this year. And elsewhere in the U.S., other types of natural disasters, from wildfires to floods, continue to inflict billions of dollars in damage to homes and businesses. You can’t control Mother Nature, but you can protect your property. Start by understanding what your homeowners insurance will—and won’t—cover. Damage caused by wind, wind-driven rain, and water that comes in your home through the roof, windows or doors is usually covered by your homeowners insurance policy. But your policy won’t cover water that comes from the ground up. For…

a break on inherited iras could disappear

THE SECURE ACT RECENTLY passed by the U.S. House of Representatives is full of retiree-friendly provisions. But when we covered the bill in our July issue (see “Ahead”), we glossed over one not-so-popular provision of the law designed to help pay for them: killing off the “stretch IRA.” This estate-planning tool allows non-spouse heirs to inherit an IRA and “stretch” withdrawals over their life expectancy—meaning that they could leave much of the money in the account to grow tax-deferred for decades. (If it’s a traditional IRA, they’ll pay taxes on the withdrawals; if it’s a Roth, they’ll pay no taxes.) But under the SECURE Act, most younger heirs would have to withdraw the money within 10 years. Lawmakers seemed to believe that IRAs are supposed to be used for retirement, not as…

what your adviser isn’t telling you

Barbara Roper is director of investor protection for the Consumer Federation of America and a member of the Securities and Exchange Commission’s Investor Advisory Committee. What are the main provisions of the SEC rule for brokers, which goes into effect June 30, 2020? In theory, brokers—firms or individuals in the business of selling securities—are supposed to act in the customer’s best interest and are prohibited from placing their interests ahead of the customer’s interests. However, the SEC never defines “best interest.” And the rules are virtually identical to how Finra [the Financial Industry Regulatory Authority] interprets its existing standard for brokers to make “suitable” recommendations. How will brokers handle disclosures and conflicts of interest? They have huge leeway to decide how to comply. They can provide boilerplate, vague disclosures about costs, conflicts…