Money Management

Driving without insurance is illegal in most states, but plenty of people do it anyway. Here’s how drivers can protect themselves. [[{“value”:”

Pretty much every state requires its drivers to have insurance to get behind the wheel. At a minimum, they usually need bodily injury and property damage liability coverage to protect others on the road.

This alone can cost hundreds, if not thousands of dollars per year, depending on the driver’s accident history and location. For some, the price tag is so steep that they choose to skip coverage altogether. But that’s a huge problem — and not just for those breaking the law.

These 10 states have the most uninsured drivers

The following 10 states had the highest rates of uninsured drivers in 2019, according to the Insurance Research Council:

Mississippi (29.4%)Michigan (25.5%)Tennessee (23.7%)New Mexico (21.8%)Washington (21.7%)Florida (20.4%)Alabama (19.5%)Arkansas (19.3%)District of Columbia (19.1%)California (16.6%)

Some of these states, like Michigan, have above-average insurance premium costs, which are likely too much for some to afford. But uninsured drivers are on the road in every state, and in some, they’re becoming more common.

A recent J.D. Power survey revealed that South Dakota saw a 106% increase in uninsured drivers from the second half of 2022 to the first half of 2023. New Hampshire, West Virginia, Oregon, and Indiana also saw increases of 36% or more during this time period.

The problem with uninsured drivers

Uninsured drivers pose an obvious problem to themselves. Most states assess fines, suspend licenses, and even jail those who are caught driving without insurance. And when these drivers apply for coverage again, they’ll pay a lot more.

Uninsured drivers also risk massive bills if they cause an accident. With no insurance, they’ll have to pay the full bill out of pocket. This could be tens or hundreds of thousands of dollars if someone is injured. The risks clearly outweigh the short-term gain of skipping premiums.

But even insured drivers are at risk when uninsured drivers are on the road. Most states’ minimum coverage requirements won’t help a driver out if they’re hit by an uninsured driver. Those seeking this protection must invest in uninsured and underinsured motorist coverage.

This pays for a driver’s medical and auto repairs if they’re hit by a driver who doesn’t have car insurance or who doesn’t have enough to cover the full extent of the damages. In some states, the amount of uninsured motorist coverage a driver chooses must equal their liability coverage limits while other states enable policyholders to choose how much coverage they want for each.

Uninsured/underinsured motorist coverage is always an option, even in states where it’s not required. Adding it will increase the policy’s premiums, but the only way to know how much is to get quotes from the best auto insurers.

Compare prices with and without the coverage to decide whether it’s worth the investment. If it’s too expensive, seek out coverage from other providers or consider raising the deductible to lower the premiums. It only takes a few minutes, and it could save drivers major headaches in the event of an accident.

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Sometimes, when a stock gains value, it can cause issues. Read on to see why. [[{“value”:”

Buying stocks is something I’ve been doing for quite some time. And I’ve always been a fan of the “buy and hold” strategy, where you identify quality businesses and hold onto their shares for years or decades to get the maximum benefit and return out of your investments.

One such stock that I’ve held for many years is Apple. Over the past year, Apple’s stock price has risen more than 22%.

That’s a good thing for me in theory, since it means my shares are now worth more money. If I were to sell them today, I’d get a much higher price than what I paid initially.

The problem, though, is that I don’t want to sell my Apple shares. Like I said, I’m a “buy and hold” investor, so ideally, I’d like to keep my existing shares in my portfolio for many more years. But I need to unload some shares in short order for one big reason.

Big gains can throw your portfolio off balance

Apple isn’t the only stock I own whose value has risen over the past year. But based on the number of shares I own and the amount of growth Apple stock has seen, I’m now in a place where Apple consists of more than 5% of my portfolio.

Only I have a personal rule to never have a single stock comprise more than 5% of my portfolio. I like a well-diversified portfolio, and because of this, I feel that generally speaking, no single stock should occupy more than 5% of it.

But because I’m beyond that point, I now feel that I need to sell my Apple shares and replace them with a different company. See, if I were to continue to hang onto my Apple shares and let that position grow, my portfolio might take a serious beating if Apple were to miss earnings or experience negative news that results in its share price plunging.

Of course, unloading stocks at a profit isn’t so simple. The reason? There are capital gains taxes to think about.

Generally speaking, any time you earn money, the IRS gets a piece of it. So if you sell stock at a profit, you create a tax liability for yourself.

Thankfully, I’ve held my Apple shares for more than a year and a day. This puts them in the long-term capital gains tax category, which has a top tax rate of 20% (your rate will depend on your income).

Short-term capital gains taxes — those that apply to assets held for a year or less — are comparable to taxes on ordinary income and top out at 37%. So the potential to owe money there is a lot higher.

But either way, once I unload some Apple shares, I need to think about what I owe the IRS. And that’s not fun.

Always keep tabs on your portfolio

Owning stocks that gain value over time is a great thing. But it’s important to keep tabs on your portfolio when the assets you own do increase in value, because that has the potential to throw your portfolio out of whack.

You may also want to set a benchmark like I do that tells you when to sell a stock. As mentioned, I’m not comfortable having any single stock comprise more than 5% of my portfolio. You may be comfortable going higher, and that’s fine. But it’s a good idea to establish a system so you know when it’s the right time to sell.

Where to invest $1,000 right now

When our analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has nearly tripled the market.*

They just revealed what they believe are the 10 best stocks for investors to buy right now…

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*Stock Advisor returns as of February 12, 2024

We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Maurie Backman has positions in Apple. The Motley Fool has positions in and recommends Apple. The Motley Fool has a disclosure policy.

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I made a sacrifice in my 20s that helped me for years. Read on to see what it was. [[{“value”:”

My plans as a college graduate were lofty. I figured I’d get a great apartment in New York City (where I worked at the time) and resume the independent lifestyle I’d enjoyed as a college student.

Only then, reality set in, and I realized that renting a place of my own wasn’t feasible. I wasn’t particularly excited about living with roommates, and the pile of educational debt I was on the hook for paying off was pretty daunting.

Plus, my savings account seriously lacked money. Given that I’d been paying college tuition for four years on my own, that was understandable. But all told, I realized quickly that I just wasn’t in a financial position to rent a place of my own. So instead, I moved back in with my parents for a brief period.

Living with my parents had its benefits — including my mom’s delicious cooking and the occasional ride home from the subway on those nights when I had to work late (or just plain stayed out late). But it had its drawbacks in that I was living with my parents. Although 22-year-old me wasn’t looking for a serious relationship, it was hard to bring a date home knowing that my mom and dad were probably watching TV in the next room.

But living at home for a bit after college was actually, to this day, one of the best financial decisions I’ve ever made. And I don’t regret it one bit.

A move that helped me get to a financially stable place

I was fortunate enough to get a good finance job out of college. Through careful spending and frugal living, within about 18 months of getting my degree, I was able to not only pay off the educational debt I incurred, but also, build up a solid amount of savings. My emergency fund then proceeded to bail me out of numerous financial jams during my 30s, when I had more expenses. But that wouldn’t have been possible had I not enjoyed months of free rent by living at home.

During my 30s, I bought a house, had kids, upgraded cars, and took on a host of other expenses that inevitably led to other expenses. My home purchase, for example, led to numerous repairs (despite buying new construction), and I’ve had to pay for a vehicle repair on more than one occasion.

As such, during my 30s, saving money wasn’t so easy. The great job I had in my early 20s came with intense working hours that weren’t sustainable. I swapped that job for lesser-paying work around age 27, which meant that during much of my 30s, my income was lower. Combine that with the aforementioned expenses, and my savings didn’t progress much. But that was OK, because I had the emergency fund I’d built in my early 20s to fall back on.

A move I’d recommend to anyone

It’s hard to move back in with your parents once you go away to college and get to experience a certain amount of freedom. But if you don’t make that move like I did, you might miss out on a prime opportunity to better your finances before you truly have to hack it on your own.

SecureSave reports that 63% of Americans today don’t have the cash reserves to cover a $500 emergency. But you might be able to save 10 times that sum — or more — if you live at home for a period as a young adult.

And heck, there’s nothing wrong with moving back home for a bit as a not-so-young adult if your parents are willing and you need to unload some expenses for a while to pay off debt or build savings. It may be a humbling experience, but it could benefit you for years like it did for me.

Where to invest $1,000 right now

When our analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has nearly tripled the market.*

They just revealed what they believe are the 10 best stocks for investors to buy right now…

See the 10 stocks

*Stock Advisor returns as of February 12, 2024

We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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Older adults and taxpayers with low to moderate incomes may qualify for free tax assistance. Here’s what you need to know about AARP Foundation Tax-Aide. [[{“value”:”

You may want to begin organizing your tax documents soon. April will be here before you know it. But if you need assistance preparing your tax return, there is still time to get help.

One such resource available to eligible taxpayers is the AARP Foundation Tax-Aide program. Volunteers assist taxpayers with their tax preparation and filing needs. Find out more about the program to see if you or someone you care about qualifies for this free resource.

Introducing the AARP Foundation Tax-Aide

Since 1968, AARP has provided free tax help to more than 78 million taxpayers through AARP Foundation Tax-Aide. Trained IRS-certified volunteers assist adults 50 and older and those with low to moderate incomes by helping them prepare and file their federal tax returns. You don’t need to have an AARP membership to receive tax assistance through this program.

The AARP Foundation Tax-Aide is available from Feb. 1 through April 15. Eligible taxpayers can get in-person or online support with their tax needs. There are participating Tax-Aide locations nationwide. AARP has a Tax-Aide site location tool that interested taxpayers can use to find their closest location. You can call a nearby site to schedule an appointment or learn more.

Keep in mind that volunteers can help with most, but not all, tax returns. Help may be unavailable to taxpayers with more unique tax situations like farm income and expenses, virtual currency investments or transactions, or more complex self-employment income situations.

Taxpayers with complex tax situations may want to explore online tax preparation software solutions if they need guidance. Check out our list of the best tax software to learn more.

Get in-person tax support

If there’s a Tax-Aide site near your home, you can get in-person tax help. AARP offers multiple ways for taxpayers to get in-person support. Some options require one visit to a Tax-Aide location, while others require multiple visits.

Need minimal guidance? Taxpayers also have the option to schedule an in-person visit for facilitated self-assistance to have support available while they prepare and file their tax returns.

Get online-only tax support

Taxpayers can also get online tax support through the AARP Foundation Tax-Aide. This solution requires no site visit. Taxpayers upload copies of their documents into the provided software, and volunteers prepare their returns remotely. If you choose this method, you can work with a volunteer online to finalize and file your return. A copy of your filed tax return will be sent to you.

Get access to online tax coaching

For taxpayers who need minimal assistance, online tax coaching is also available through this program. With this alternative tax preparation model, the taxpayer processes their own return. However, a volunteer can help if they feel stuck or have questions.

File your own taxes online for free

Another alternative is self-preparation. This solution is ideal for taxpayers who feel confident handling their own tax needs, but want to avoid paying the expensive tax-filing fees that many tax preparation companies charge. This free service can benefit your personal finances.

Don’t delay filing your tax return

There’s still time to prepare and file your return. But don’t wait too long. You want to ensure you have all the documents you need and allow plenty of time to file before the April 15 deadline.

Don’t ignore free tax-filing resources like AARP Foundation Tax-Aide. Any money saved on avoidable fees like tax-filing expenses, can be a win for your bank account. Want to learn more before you start your taxes? Review our tax-filing guide to learn more about essential tax topics.

Where to invest $1,000 right now

When our analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has nearly tripled the market.*

They just revealed what they believe are the 10 best stocks for investors to buy right now…

See the 10 stocks

*Stock Advisor returns as of February 12, 2024

We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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