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Asking a financial expert if theyre working in your best interest when giving you advice on your retirement account seems like a simple enough question. That question is now getting a little more complicated.

Known as the fiduciary rule and set by the Labor Department to take effect in April 2017 ” but then delayed by the Trump administration until at least June 2017 and some parts until January 2018 ” the rule simply requires people in the financial services industry to put consumers best interests ahead of their own.

Without this rule, financial advisers could steer clients to mutual funds with excessive fees or have other conflicts of interest such as higher bonuses or prizes. The Obama administration put the loss at $17 billion a year from retirement accounts for such conflicts.

The fiduciary rule would prohibit advisers from concealing any potential conflict of interest, and required that all fees and commissions must be clearly disclosed in dollar form to clients. It also expanded the definition of a financial adviser not just to someone giving ongoing advice, but to any professional making a recommendation or solicitation.

President Donald Trump has delayed the rule, which is now under review. Some groups have said they may sue the administration if the rule is weakened or killed.

The fiduciary rule is necessary, supporters say, because most financial advisers arent held to a legal standard requiring them to put a clients interests first ” much like a doctor or lawyer must do.

Instead, financial advisers can legally act in their interests first and can earn bigger commissions for more expensive products that they sell. They can earn more by giving bad advice, and its legal.

To avoid this problem, consumers can look for fee-only advisers who charge a one-time fee for financial advice. They dont earn a commission for steering customers into one investment product over another.

Before the rule was scheduled to be implemented, some investment firms had changed their prices on funds to appeal to consumers. Some high-fee products were removed and some companies eliminated commission-based sales practices entirely. Some also created new products that are less expensive for consumers.

If you work with a financial adviser, ask them if theyre a fiduciary and if theyre obligated to act in your interests above their own. If not, you may want to switch advisers.

Hope you found these tips helpful! Contact me for more insights and info.

Published with permission from RISMedia.

Coming up with the down payment on a home can be hard enough, and one way to make a home more affordable is to spread out the mortgage payments over 30 years.

But 30 years can be daunting, and that time can be cut down with a 15-year mortgage. Its a lot more expensive in the short-term than a 30-year fixed-rate mortgage, but pays off through greater long-term savings.

Here are some things to consider when weighing a 15-year vs. 30-year mortgage:

Saving Money
It can be difficult to see the long-term benefits when looking at a monthly mortgage bill that will be 50 percent higher over 15 years instead of 30.

Paying a home loan off in half the time requires a larger payment, of course, but it can save you tens of thousands of dollars in interest charges. Why? Not only is more principal paid earlier, but interest rates on 15-year mortgages are usually better than other loans types.

Heres an example of a $200,000 mortgage at 30 vs. 15 years:

Mortgage type: 30-year 15-year
Interest rate: 4.5 percent 4 percent
Monthly payment: $1,013 $1,479
Total interest: $164,813 $66,288

Thats almost a savings of $100,000 by going with a 15-year loan. Divide that savings over 15 years and its about $555 saved per month.

Borrowers should make sure they have enough income to afford it, are able to manage their household debt and have money in liquid savings for emergencies.

Building Equity
Repaying a mortgage faster not only saves you money in the long run, but you build equity in your home faster, too. If home prices rise, your equity could grow as well.

This is good for many reasons, including making refinancing easier by lowering your debt-to-income ratio. While it wont improve your cash flow, it should make it easier to get approved for a home equity loan or home equity line of credit.

An Easier Retirement
Another big advantageif you plan to retire in the next 10 to 20 years, you won’t have to worry about mortgage payments during your retirement. Instead of a house payment, you can use that money for retirement expenses.

If you continue paying a 30-year mortgage into retirement, you may have to pull money out of your savings to make the payments.

Published with permission from RISMedia.

A federal program helps low-income families buy a home with a unique method meant to encourage saving: It matches dollar-for-dollar what they save to buy their first home.

The Individual Development Account, or IDA, doesnt offer a lot of money to help with a down payment ” up to $2,000 in federal matching funds with more contributions possible from local IDA programs ” but its a start.

Participants can start by saving as little as $25 ” matched to as much as eight to one, depending on the program, though most offer one-to-one matches. Income levels must be 200 percent below their states poverty level.

With an 8:1 match, IDA participants can raise much more than the $4,000 total with federal matching, and could have $10,000 or so for a down payment on a house.

Most IDAs are funded by the federal government and are run by nonprofit groups and financial institutions, and grantee programs are required to raise an equal contribution of nonfederal funds. It can take from six months to several years to save for a down payment on a house through the program.

To earn the matching dollars, some IDA programs require account holders to take financial literacy classes and training on homeownership; they are also provided counseling and instructions on how their local program works.

More than 60,000 IDAs have opened in the U.S. since Congress established them in 1998. The Administration for Children and Families is the federal agency that provides the federal half of the match.

IDAs arent just used for buying a home. The matching money can also be used to repair an existing home, go to college or start a business.

Getting help with a down payment through IDA can benefit both lenders and homebuyers, who are less likely to default on home loans after participating in the program. IDA participants are 2 – 3 times less likely to lose their homes to foreclosure than other low-income buyers, according to a 2010 study from the Corporation for Enterprise Development and the Urban Institute.

An IDA might not be for everyone. But for families that can afford to save small amounts of money over time, matching money from an IDA can help them get a good start on a down payment and homeownership.

Published with permission from RISMedia.

There are many ways parents can help their children purchase a home: contributing to a down payment, helping with closing costs, co-signing a mortgage or allowing their kids to move back home so that they can save money.

While most of these avenues involve giving your children money, deciding where that money should come from is an important decision. For parents nearing retirement, pulling money from a savings account or a 401(k) retirement account can be problematic if the money is needed for retirement. Without it, they could end up moving into the house they helped their children buy.

A poll by loanDepot found that more parents are planning to help their millennial children buy their first home. Sixty-seven percent said they planned to pull the money from their savings account.

Here are the percentage of poll respondents who planned to use other sources of parental support:

• Refinancing their own home: 8 percent
• Taking out an unsecured personal loan: 8 percent
• Selling equities: 5 percent
• Borrow from 401(k): 4 percent
• Sell primary home: 2 percent

For the parents who do pull money from their savings account to help with a down payment, theres some disagreement with their children over whether the financial support is a gift, loan, inheritance or something else, the poll found.

Most parents (68 percent) view it as a gift, while more millennials (36 percent) viewed the financial support as a loan to be repaid (29 percent).

A down payment on a home is the most common form of assistance from parents, with half of those polled planning to help in that way on future purchases. The other methods were:

• Allowing their kids to continue living at home to save money: 33 percent
• Paying other expenses so the children could save money: 30 percent
• Kids moved back home: 22 percent
• Help with closing costs: 20 percent
• Co-sign the mortgage: 20 percent
• Help pay down student loan debt: 18 percent
• Help pay their rent for a period of time: 8 percent

Allowing an adult child to move back home so they can save money may be the least costly option for parents wanting to help their children buy a home, as it shouldnt require parents to pull money from their savings or retirement accounts that they will surely need down the road.

Published with permission from RISMedia.

Closing costs are 2-5 percent of the purchase price of a home, resulting in an average of $3,700 in fees for paperwork required to buy a house. Thats a lot of money to come up with when you may have already put everything toward a down payment.

Some fees from mortgage lenders are required by federal law to be the same, and there isnt much you can do to change these costs listed in a HUD settlement statement ” origination, underwriting, administrative and doc-preparation, among others.

Other closing costs, however, can be negotiated. Here are some to check into:

Lender fees: All customers must legally be charged the same lender fees by a lender, so you cant negotiate them. But you can shop around for a lender with low fees, as seen in their good faith estimates, which shouldnt differ from the HUD statement.

Higher loan rate: If youre willing to pay a higher loan rate, then lenders will discount the fees. Those can be added to the loan and are seen through a slightly higher monthly mortgage payment.

Title insurance: This type of insurance is required to protect the lender and you if there are undiscovered liens against the property. Shop around for lower title insurance or negotiate the fee.

Home insurance: Lenders require a home insurance policy, which can cost from $300 to $1,000 a year, depending on where you live and the type of home. Shop for an insurer that offers discounts for certain factors, such as having multiple policies, a new roof or specific home improvements.

Negotiate with the seller: If youre in a buyers market, ask a home seller to cover part of your closing costs. The worst that can happen is they say no.

Add costs to the loan: If none of these tactics work and you still have difficulty paying closing costs, ask your lender to add them to the loan. Instead of paying these costs all at once, youll be able to pay them over 30 years or however long your home loan is for; you wont feel the financial pain as much over time.

Published with permission from RISMedia.