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Will Yahoo Breach Compromise Credit Cards? Probably Not

It’s password-changing time again.

Yahoo’s announcement that a “state-sponsored actor” had pilfered data, potentially including concealed passwords, from half a billion accounts in late 2014 represents one of the largest such security breaches ever disclosed. The “good” news — if we can call it that — is that the passwords were concealed and that the hack doesn’t appear to have directly involved credit cards or bank accounts, according to Yahoo’s announcement.

Credit card accounts probably won’t be affected. But “probably” is not “certainly.” If you tend to reuse passwords across multiple sites, now’s the time to stop, and to change those passwords. And Yahoo is still encouraging people to check their credit reports.

Not another Target

When you hear “data breach,” you might think of what happened to Target in 2013. About 70 million customers were affected, and — worse — 40 million credit card numbers were stolen. Millions of customers had to worry about fraudulent activity on their cards as a result.

The Yahoo breach is roughly seven times as big as the Target one, but for affected consumers, it’s not seven times worse.

The difference has to do with what was stolen. In Yahoo’s case, the stolen information included names, email addresses, phone numbers, dates of birth, concealed passwords and, in some cases, security questions and answers both unencrypted and encrypted, according to a news release from the company. Yahoo also notes that the ongoing investigation suggests that “stolen information did not include unprotected passwords, payment card data, or bank account information.”

The passwords were also “hashed,” according to Yahoo. That means they were run through a “mathematical function that converts an original string of data into a seemingly random string of characters,” according to Yahoo.

Signs of a potential hack reportedly emerged earlier this summer on the “dark web” — a space of the internet unreachable by search engines, where illegal dealings can go undetected. A hacker tried to sell what was supposedly 200 million Yahoo accounts for 3 bitcoins, or roughly $1,860, Motherboard reported in August. That’s on the cheap side, if you consider that login credentials for banks around the world go for “between US$200 and US$500 per account” in marketplaces like these, according to a white paper by Trend Micro.

What could happen

The credentials stolen in the Yahoo breach aren’t that valuable as long as the passwords are concealed. But there’s still a risk that hackers could glean more information from the breach than we think.

Take the passwords, for example. When passwords are hashed, they’re essentially useless. But it’s possible that hackers could “unhash” those passwords, says Al Pascual, senior vice president and head of fraud and security at Javelin Strategy & Research.

“There is software such as Hashcat and John the Ripper which is designed to crack passwords,” Pascual says. “It takes time and processing power, and even then not every password is typically decrypted.”

If hackers were successful at unhashing some of the passwords, they could run scripts to hit as many websites as possible to see where those passwords work, Pascual says. That could affect consumers who use the same password for every account.

Even if that proved successful, though, hackers probably wouldn’t be able to get at your financial accounts. Major banks and issuers have security software that locks users out after multiple failed sign-in attempts. However, Pascual says some smaller issuers don’t have this capability.

Phishing scams are another potential result of the breach, and one that Yahoo is anticipating. The company stressed that the email it sent to those affected by the breach “does not ask you to click on any links or contain attachments and does not request your personal information” — requests that are common tactics in phishing emails. Your credit card information might not be affected by the Yahoo breach directly, but it might be compromised if you give your log-in credentials to someone pretending to be Yahoo via email.

» MORE: Crooks want your credit card points

What to do about it

If you received notice from Yahoo that you were affected by the breach, here are three things you can do to guard against potential fraud on your credit cards and other accounts:

  1. Change your passwords. “People tend to not update their passwords unless they absolutely have to,” Pascual says. Hackers see that as a major opportunity. So if you use the same password for all your accounts, don’t just update your Yahoo password — update your other passwords, too. At the very least, make sure the passwords you use on your credit card and bank accounts aren’t the same ones you use on websites that look like they were designed by sixth-graders in 1999.
  2. Read emails carefully. Don’t reply to emails purporting to be from Yahoo — or any company, for that matter — if they prompt you to provide a password, username or any other personal information, or ask you to click a link. Fraudsters use urgent-sounding emails like these to get valuable information out of unsuspecting consumers.
  3. Check your credit report and financial accounts. Although Yahoo’s breach didn’t include financial data, “we encourage you to remain vigilant by reviewing your account statements and monitoring your credit reports,” according to a statement from the company.

You can get a free credit report once a year from each of the three major credit bureaus: Experian, Equifax and TransUnion. Go to AnnualCreditReport.com. If you detect signs of fraud on your credit card account — say, unfamiliar purchases — call your issuer right away and report it. The law sharply limits your financial responsibility on bank account fraud and credit card fraud. Even if your credit card is indirectly affected by this breach, you probably won’t have to pay for it.

Claire Tsosie is a staff writer at NerdWallet, a personal finance website. Email: claire@nerdwallet.com. Twitter: @ideclaire7.

What Students Can Do When For-Profit Colleges Close

It’s an uneasy time for students of for-profit colleges. Mass school closures have dominated the headlines recently, and more uncertainty is on the way: The Department of Education said Thursday it will no longer recognize the Accrediting Council for Independent Colleges and Schools, the largest accreditor of these colleges.

That’s significant because without accreditation, for-profit colleges can’t receive federal student aid, which is their primary source of revenue. Without that funding, these schools won’t be able to operate.

Fallout from Corinthian, ITT

The Department of Education’s announcement was a response to a recommendation made to it in June by the National Advisory Committee on Institutional Quality and Integrity. The committee ruled that ACICS should no longer be recognized by the federal government, citing a lack of oversight of its institutions, including the now-shuttered Corinthian Colleges and, most recently, ITT Technical Institute, which closed in September and left 40,000 students high and dry nationwide. Both schools’ closures left thousands of students without degrees, burdened by loans and with their educational futures in limbo.

ACICS says it will appeal the department’s latest decision, leaving final say in the hands of Secretary of Education John B. King. Experts say King is likely to announce a final decision by the end of the year, before his term concludes. If the appeal is rejected, colleges accredited by ACICS will have 18 months after the decision is finalized to secure accreditation by another federally recognized agency. Schools that can’t find a new accreditor are likely to close.

A changing landscape

Accreditation recognizes that a college or university upholds the standards of quality necessary for its students to earn credentials in a professional field or be admitted to other recognized institutions.

Increased scrutiny of accreditation agencies and the for-profit sector has altered the landscape for these institutions and their students, according to Kevin Fudge, director of consumer advocacy and ombudsman at American Student Assistance, a nonprofit centered around education finance.

Vocational and trade schools once typified for-profit colleges, until the industry ballooned with the advent of online education. Schools such as University of Phoenix — now a nonprofit — considerably broadened the reach of for-profit schools by attracting nontraditional students. In recent years, for-profit colleges have been chastised for their high price tags and low completion rates, as well as lower-paying jobs and high instances of student loan default among graduates.

ACICS first received federal recognition in 1953 and most recently was the accrediting agency for nearly 250 schools and hundreds of their campuses. It’s unclear which accreditors those schools will turn to now. Schools with sound practices or existing accreditations from other agencies aren’t likely to have a problem maintaining accreditation. But institutions with shakier foundations, such as those already being monitored for their financial and recruiting practices, may have a more difficult time finding an agency to accredit them.

Fudge advises students to carefully weigh their options. “It illustrates the importance for students to be wise consumers,” he says. “If you think your school is one that might be under scrutiny, you can check with the school about its current accreditation status.”

Unfortunately, the federal government is offering no independent means of assessing or obtaining information about a particular school’s status, except for its list of schools under financial scrutiny, known as Heightened Cash Monitoring.

What you can do

Obtain your educational and financial records early so that if your school closes — or is on the brink of shutdown — you’ll have the documents you need to move forward. Graduates will want to obtain copies of their transcripts. Here are your options and the consequences if you have federal loans.

Apply for closed school discharge

Under a closed school loan discharge, all of your federal loans will be dismissed. That amount discharged will not count as taxable income on your federal return. If your school loses accreditation but doesn’t close, this option won’t be available.

If you’re eligible, you can apply with your federal loan servicer only if a school closes while you’re enrolled and haven’t completed your program, or if the school closes within 120 days after you withdraw from a program without a degree. However, you are not eligible if you completed a comparable educational program through a teach-out program elsewhere (more on that below) or have completed all coursework for your intended degree.

Seek borrower defense to repayment

To receive relief under a provision called borrower defense to repayment, you would have to demonstrate, in court, that your school violated laws in its state when it came to educational services or loans. The Department of Education is expected to soon release guidelines about borrower defense, since the right has not been exercised en masse in the past.

Reid Setzer, deputy director of policy and legislative affairs at Young Invincibles, a nonprofit focused on engaging young adults in political issues, pointed to the lack of structure when Corinthian Colleges closed. “When Corinthian went down, there was no playbook,” he says, citing the sheer volume of students eligible for the option. But by the time more closures occur after the start of the 18-month clock, borrower defense regulations may be available.

You can submit a claim for loan forgiveness as well as reimbursement for any payments already made. You can work with an attorney, but it’s not required. After submitting a claim, your loans will be placed into forbearance and collections on any defaulted loans will be suspended. However, interest will continue to accrue.

Transfer to another school or teach-out

While your school is finding a new accreditor, you can continue to access federal aid, but you might want to consider transferring.

“If a school isn’t soluble, you might not want to keep funneling money to them,” Setzer says. “You have a right to get out of those schools and attempt to transfer, which we know can be difficult.”

Transferring can be problematic because credits obtained under a school that is no longer accredited or has closed may not be transferable to another institution.

If your school is on the path to closure, it may offer students a teach-out program in which you finish your coursework at another institution that has agreed to take on students from your school. Be sure to check on the status of a new institute using College Scorecard.

Transferring or enrolling in a teach-out program will render you ineligible for a closed school loan discharge, but you may be able to pursue borrower defense.

Options for private loans, grants, military

Federal loan borrowers may have options in the event of a school closure, but if you have private loans or grant funds for education, or if you paid cash for your tuition, little relief is possible.

Private loan borrowers: While federal loan borrowers may have options, private loan borrowers will still be responsible for repayment. Contact your lender or servicer to see what assistance may be available.

Pell Grant recipients: There’s no way to reimburse students for distributed Pell Grant funds, which means the amount already disbursed will still count toward a student’s six-year maximum eligibility.

GI Bill benefit recipients: The U.S. Department of Veterans Affairs doesn’t have the authority to reset GI Bill benefits for a student when a school closes, even if a student cannot transfer credits. If a school is no longer approved by the VA as an institution where GI Bill benefits may be used, students can’t continue to use those funds at that location. Students can transfer to a new school and continue to receive GI Bill benefits.

State tuition recovery funds

For students who don’t qualify for federal debt assistance, there may be one last resort. If your state offers a tuition recovery fund or student protection fund, you may be able to receive some compensation for lost costs and educational opportunity due to a school closure. Fund availability and qualifications will vary from state to state, so check with your state’s post-secondary or licensing agency.

Once the clock begins ticking for ACICS accredited schools to find a new agency, you’ll have 18 months to make your decision about your educational future. Contact your school to learn more about the status of the process.

Anna Helhoski is a staff writer at NerdWallet, a personal finance website. Email: anna@nerdwallet.com. Twitter: @AnnaHelhoski.

What You Need to Qualify for a Credit Card for Bad Credit

When you have damaged credit, those “easy-to-get” credit cards aren’t always easy to get.

Even with credit cards for bad credit, issuers vet applicants carefully against several requirements, known as underwriting standards, to find customers who are less likely to default. In some cases, federal law also requires issuers to get certain information before extending credit to a borrower.

If you want to qualify for a secured credit card — that is, a card that requires a cash deposit — or an unsecured card for bad credit, here’s what you’ll need.

An identification number, an address and other personal information

Required for all U.S. credit cards.

No matter where you apply for a credit card, your issuer will always want to know who you are. Provisions of the USA Patriot Act designed to combat terrorism and money-laundering require issuers to get your personal information.

For most people, providing name, address and birthdate is the easy part. But if you’re new to the U.S., filling out the Social Security number field might be a stumbling block. If you don’t have an SSN, you can get an individual taxpayer identification number. If you skip these sections altogether, or if you’re under 18, your application will be rejected.

Income

Required for all U.S. credit cards.

Issuers must check that borrowers have an “ability to pay” before extending them credit, under the Credit Card Act of 2009. But depending on the issuer, that can mean different things.

At the very least, your issuer is going to ask about your annual income, to make sure you have one. If you’re over 21, this includes all the income to which you have “reasonable expectation of access.” That means you can include your partner’s income.

Most secured cards don’t have minimum income requirements. But some take your debt and monthly living expenses into consideration. The Capital One® Secured MasterCard®, for example, will deny your application if your monthly income doesn’t exceed your rent or mortgage payment by at least $425, according to its terms.

If you’re applying for an unsecured credit card from a major issuer, you’ll likely have to meet a minimum income requirement — usually $10,000 or $12,000 per year. If your income is too low, or you’re carrying too much debt, your application might be rejected.

A security deposit

Required for all secured cards.

Unlike “regular” credit cards, secured cards require cash collateral when you open a new account. Typically, you need to put down at least $200 or $300 for a security deposit, which then determines your credit limit. For example, a $300 deposit would get you a $300 limit. If you fall behind on payments, the issuer keeps that deposit. Otherwise, you’ll get your money back when you close the account in good standing or upgrade to an unsecured credit card.

If you’re having trouble coming up with that kind of money, it’s usually best to save up for a secured card with a lower deposit requirement. Unsecured credit cards from subprime specialist issuers — or issuers that focus on borrowers with bad credit — may seem appealing, but could end up costing you over $100 more in fees each year, according to a NerdWallet study.

A checking or savings account

Requirement varies by issuer.

A checking or savings account gives you a secure place to store money and can help you build an emergency fund. But often it’s also required for funding a secured card’s security deposit or used by issuers to determine your financial stability. If your ChexSystems record is keeping you from opening an account, look for a bank or credit union that offers a second-chance checking account in your area.

A credit history without serious negatives

Requirement varies by issuer.

Some credit cards, like the OpenSky® Secured Visa® Credit Card, don’t run credit checks. But most do. Usually, issuers do this to look for red flags that your financial life might be getting worse, not better. For instance, for the Discover it® Secured Card – No Annual Fee, “Factors such as income, bankruptcy, debt and judgments” — for example, liens or lawsuits — “may impact your ability to be approved,” according to a statement from Discover. Among major issuers, these types of warnings are typical.

Try to improve your credit as much as you can before applying for cards — say, by getting caught up on payments on your existing accounts. If a recent bankruptcy is keeping you from an approval, find out whether you can get a credit card with your local bank or credit union. While cards that skip credit checks are an option, they tend to be more expensive.

» MORE: Applying for a credit card after bankruptcy

A clean history with the issuer

Requirement varies by issuer.

Bad blood can sometimes get in the way of a credit card approval. If you’ve defaulted on your payments with a certain issuer before, that issuer likely won’t approve your application for a new card. Instead of dwelling on the past, start a clean slate by working with a different company. Remember, many banks are happy to get your business. Look for a lender that gives you a chance to rebuild your credit on good terms.

Claire Tsosie is a staff writer at NerdWallet, a personal finance website. Email: claire@nerdwallet.com. Twitter: @ideclaire7.

Mortgage Rates Today, Friday, Sept. 23: Lower Again

Thirty-year and 15-year fixed mortgage rates as well as 5/1 ARM rates were all lower again this morning, according to a NerdWallet survey of mortgage rates published by national lenders Friday.

Rates on 30-year fixed home loans are at their lowest level in two weeks, according to the NerdWallet Mortgage Rate Index.

NerdWallet provides clarity to all of life’s financial decisions. Hal M. Bundrick, CFP Mortgage Rates Today, Friday, Sept. 23 (Change from 9/22) 30-year fixed: 3.62% APR (-0.01) 15-year fixed: 3.04% APR (-0.02) 5/1 ARM: 3.53% APR (-0.02) Mortgage rates likely to move higher by year-end

The Federal Reserve left short-term interest rates alone this week, but that doesn’t mean mortgage rates won’t move higher. Steve Hovland, director of research for HomeUnion, an online real estate investment management firm, sees the potential for mortgage rates to rise, despite the Federal Open Market Committee’s decision to stand pat.

“Rates are almost certain to move by year-end, barring any catastrophic economic news. The capital markets are expected to lift borrowing costs well ahead of December’s meeting, once again leaving the FOMC catching up to the market rather than setting it,” Hovland said in an analysis. “Last year, average mortgage rates drifted up approximately 25 basis points (0.25%) between the September and December meetings.”

Although a lot of attention is given to Fed policy decisions, it is important to remember that mortgage rates remain extremely low by historical standards, Hovland added.

Homeowners looking to lower their mortgage rate can shop for refinance lenders here.

NerdWallet daily mortgage rates are an average of the published APR with the lowest points for each loan term offered by a sampling of major national lenders. Annual percentage rate quotes reflect an interest rate plus points, fees and other expenses, providing the most accurate view of the costs a borrower might pay.

More from NerdWallet Compare online mortgage refinance lenders Compare mortgage refinance rates Find a mortgage broker

Hal Bundrick is a staff writer at NerdWallet, a personal finance website. Email: hal@nerdwallet.com. Twitter: @halmbundrick.

Ask Brianna: Should I Delay Goals While I Repay Student Loans?

“Ask Brianna” is a Q&A column for 20-somethings, or anyone else starting out. I’m here to help you manage your money, find a job and pay off student loans — all the real-world stuff no one taught us how to do in college. Send your questions about postgrad life to askbrianna@nerdwallet.com.

This week’s question:

“I want to get married, buy a house and hit other adult milestones in my 20s and 30s, but my student loan debt is holding me back. Should I put off other goals while I repay my student loans?”

Feeling stymied by student loans is becoming a defining part of being a 20- or 30-something. The numbers are stacked against us: College is more expensive, we’re taking on more debt to afford it, and it’s harder for us to repay the money we borrow.

According to the College Board, the average public four-year college’s net price — the amount you pay for tuition, fees, room and board after accounting for scholarships, grants and tax benefits — jumped from $9,940 a year to $13,320 from 2003-04 to 2013-14. Not surprisingly, the average amount of student loan debt at graduation went up 56% between 2004 and 2014, the Institute for College Access & Success reports. Meanwhile, the median household income fell 6.5% between 2007, the year before the recession hit, and 2014, according to the U.S. Census Bureau.

Your concerns are real, and don’t let anybody tell you that you just shouldn’t have taken out student loans, or that you should have chosen a more lucrative major when you were 18 and couldn’t plan past your next meal.

But there are ways to make your student loan payments more manageable so you can afford a wedding, a down payment and other trappings of adulthood. You can also recast your expectations of what you’re supposed to achieve in your 20s and 30s to lessen that feeling of falling behind.

Lower your student loan payment

Affording your student loan bills should be your priority because the consequences of default can be severe. When you default, the government, for instance, has the power to withhold your pay or seize your tax refunds to collect your unpaid federal loan debt.

If you’re having trouble making your payment, switch to an income-driven repayment plan. These options can reduce your monthly student loan bill to 10% or 15% of your income. Check whether you’re eligible for student loan forgiveness, too: Public Service Loan Forgiveness will make your remaining loan balance disappear after 120 on-time payments if you work for a nonprofit or government agency.

Refinancing can also help you manage your student loans. A private lender will pay off your current debt and issue you a new loan at a lower interest rate. You must qualify based on your income, credit score and job history, so it’s best for those who aren’t in danger of falling behind on payments. You’ll also lose certain benefits if you refinance your federal loans.

Set your own expectations

Before you lament the cushy lifestyle your loans robbed from you, remember that those loans helped get you a college education. A degree earns 25- to 34-year-olds an extra $20,000 a year on average compared with those with a high school education, according to the National Center for Education Statistics.

Yes, you might hit those classic adult milestones later — but you’ll still hit them. Starting about age 27, homeownership rates are higher among those who took on debt to go to college than those who didn’t go to college at all, according to a recent report by Susan M. Dynarski, a senior fellow at the Brookings Institution and a professor at the University of Michigan.

Keep in mind, too, that buying a house isn’t the ultimate sign you’re an adult, and putting it off doesn’t make you a failure. Helen Ngo, a certified financial planner and principal at Capital Benchmark Partners in Atlanta, says her 20- and 30-something clients who recently graduated with medical, law and other graduate debt aren’t eager to buy homes.

“Most of them just want to make money and pay off debt and travel,” she says.

Is that such a problem? Given the chance, I know you’d get rid of your student loans tomorrow; I would, too. But if they got you a degree, they were probably worth it. Work them into your budget, plan for the future anyway, and know that you don’t have to meet anyone’s expectations but your own.

Brianna McGurran is a staff writer at NerdWallet, a personal finance website. Email: bmcgurran@nerdwallet.com. Twitter: @briannamcscribe.

This article was written by NerdWallet and was originally published by The Associated Press.

Marijuana legalization initiatives could inject $7.8B into economy

Voters in nine U.S. states will decide on marijuana legalization initiatives come November. And if just seven of those initiatives pass, a new report says those states could inject $7.8 billion into the nation's economy by 2020.

>> Read more trending stories

Of course, marijuana is still illegal under federal law.

But Arizona, Nevada, Massachusetts, Maine, Montana, Florida and California are all voting to loosen their own pot restrictions.

And the report from New Frontier Data and Arcview Market Research says it could mean big money.

The study also claims the entire cannabis industry in the U.S. could hit $20.6 billion by 2020, which is slightly less than what was predicted earlier this year.

Still, as New Frontier's CEO said in a statement, "The cannabis industry is one of the fastest growing sectors in the economy and continues to astonish those in and out of the space."

Currently, 25 states and the District of Columbia have laws legalizing marijuana in some form.

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How to Escape Low-Yield Bank Savings Options

By Kirk Kinder

Learn more about Kirk on NerdWallet’s Ask an Advisor

There’s no doubt that the returns you can find on cash holdings these days are less than attractive. Traditional bank savings vehicles — such as checking accounts, savings accounts, money market deposit accounts and certificates of deposit — often yield less than 1% per year. Longer-term CDs — say three years — occasionally yield closer to 1.5%.

You don’t have to accept those paltry rates. There are some ways you may be able to get better returns without taking on too much additional risk.

I-bonds

The first option is I savings bonds, or I-bonds. They’re issued and guaranteed by the U.S. government, and their returns consist of two components. The first is an interest rate that remains fixed for as long as you own the bond — currently at 0%. So why in the world would you want one? The answer is the second component of the return: a variable inflation rate, hence the “I” in I-bond. The rate is adjusted twice per year.

Over the past few years, the total return on these bonds has surpassed 3% at times. The inflation component has returned just 0.85% during the past year, but that still beats the returns you’d receive on many money market accounts and even some long-dated CDs. The gains are also exempt from state and local taxes, and you can defer federal taxes until you redeem the bonds.

But there are downsides to I-bonds. First, you can only buy $10,000 worth each year. Married couples can bump this up to $20,000. You also have to hold I-bonds for at least one year, which means they’re not an appropriate place to keep immediate living expenses — but then, neither are longer term CDs. Finally, if you redeem the bonds within the first five years, you won’t receive the last three months of interest. Even with that penalty, they often still yield more than traditional bank savings vehicles.

Peer-to-peer lending

Another option is peer-to-peer lending. These platforms let you play the role of the banker, loaning money directly to borrowers. With the banks cut out of the equation, you receive a higher return and borrowers pay lower costs.

Peer-to-peer lending platforms conduct credit analyses on borrowers, and you can review each borrower’s profile before deciding whether to invest. You can also diversify your investment by making several small loans or asking the company to pick loans for you using credit or interest rate criteria you set. Of course, these investments aren’t backed by the Federal Deposit Insurance Corp. the way checking, savings and money market accounts and CDs are.

Prosper and Lending Club are two of the most popular peer-to-peer lending platforms; they’ve been around since 2006 and 2007, respectively. The industry is still quite new compared with the traditional banking system, so it has its growing pains, and you should be sure you’re comfortable with that before investing. That said, Lending Club and Prosper have successfully loaned individuals billions of dollars.

Lending money to people you don’t know or losing federal backing might scare you. But peer-to-peer companies have years of data on default rates, which are quite low for the highest-graded loans. According to Lending Club, less than 1% of the total issue amount of A-graded loans was charged off between Q1 2007 and Q2 2016. And with annualized returns of about 5%, those top-graded loans still trump traditional savings options even with the risk of default.

The loans’ potential illiquidity is another downside. Platforms exist to sell the loans, but you might not find a buyer or get the full value of the loan. And peer-to-peer lending isn’t authorized in every state. Ask your state’s securities regulator if it is in yours.

Even without FDIC backing, and acknowledging the default risk and lack of liquidity, peer-to-peer lending is worth considering as an alternative to savings options such as money market accounts and CDs.

Escaping low yields

If you have three to six months of emergency savings safely socked away, you can consider investing any savings beyond that in these alternatives. You still need to keep enough cash in your checking, saving or money market accounts or short-term CDs to cover immediate expenses, but if you’re looking to escape the low-yield universe of bank savings accounts, you may want to explore these options.

Kirk Kinder, CFP, is a fee-only financial planner and the principal of Picket Fence Financial with offices in Maryland and Florida.

This article also appears on Nasdaq.

The Most Affordable Time of Year to Buy a Home

While it may be more convenient to buy a home in the summer before school starts, waiting until fall or winter can save you big dollars, a new NerdWallet study found.

To determine the most affordable time to buy, NerdWallet analyzed the past two years’ worth of listings and sales in the 50 most populous U.S. metro areas using data from Realtor.com. NerdWallet found that home sale prices — the amount a buyer actually pays — in the nation’s largest metro areas typically peak during the summer, dip in the fall and are lowest in winter, potentially saving off-peak buyers thousands of dollars.

Key takeaways
  • Summer is typically the most expensive time to buy. In the majority of metro areas analyzed, home sale prices peak in June and July. Inventory is also highest those months, but so is competition.
  • Sale prices fall in autumn. Home listing prices don’t fall dramatically once summer ends — they only decrease less than half a percent in the fall. But sale prices take a noticeable dip. In the 50 metro areas, home sale prices dropped 2.96% on average — that’s a drop of $8,300 on the median home — from summer (June through August) to fall (September through November).
  • Home sale prices are usually lowest in winter. If you can wait a little longer to buy, hold off until January or February, when homes cost 8.45% less on average than in June through August. January had the cheapest sale prices in 29 of the 50 metro areas, and February had the cheapest prices in 19 areas.
Where prices drop the most

The degree of seasonal decreases in home sale prices varies across metro areas. In our analysis, the metro area of Hartford-West Hartford-East Hartford, Connecticut, experienced the largest drop in price from summer to fall at 8.2%. The Cleveland-Elyria, Ohio, metro area had the second-largest drop at 8.0%, and the Birmingham-Hoover, Alabama, metro area came in third with a 7.6% drop in price from summer to fall.

“If your circumstances give you the freedom to be able to choose the best time to look to sign a contract on a new home, there’s no question that the market dynamics favor you the most to do that in the dead of winter, ideally in January or February, right before the activity starts to heat up,” says Jonathan Smoke, chief economist for Realtor.com.

To see the most affordable time to buy a home in each metro area and view the full methodology, read the full report.

Emily Starbuck Crone is a staff writer at NerdWallet, a personal finance website. Email: emily.crone@nerdwallet.com. Twitter: @emstarbuck. Daniel Tonkovich is a data analyst at NerdWallet. Email: dtonkovich@nerdwallet.com.

2016 Toyota Mirai Fuel Cell: Back to the Future, Again

Review: 2016 Toyota Mirai Fuel Cell

One of only two fuel cell electric cars on the U.S. retail market, the Toyota Mirai — like the plug-in electric Tesla — aims to marry creature comfort and cutting-edge technology.

What you’ll like: Responsive luxury car for the long-awaited “hydrogen highway.” Super-comfortable seats, edgy look, space-age dashboard and years of free fuel.

What you won’t like: Little access to that free fuel — only a handful of stations, almost all in California. Pricey. Small trunk.

What you don’t know: There’s a better chance of getting blown up by the gas tank in your car than the hydrogen tank in the Mirai.

Price: $57,500 sticker price, $499 a month to lease — but tax incentives and other perks bring both down. Details below.

Gallery (click to expand) What’s different about the Mirai

There’s been talk about the “hydrogen highway” for years, a network of hydrogen fueling stations filling up cars that emit only drops of water so clean you could drink it. Sounds great, doesn’t it? But that vision of the future is 10 years away. And it’s always been 10 years away.

Until now.

Toyota, along with Honda and Hyundai, is putting its money where its corporate mouth is, finally offering a car powered by electricity generated by a fuel cell. The 2016 Toyota Mirai is now for lease or sale for those who can afford the high price tag and have a sense of adventure. The Hyundai Tucson Fuel Cell is already available for sale and lease in California, and Honda’s Clarity Fuel Cell is expected to enter the market by the end of 2016.

The Mirai, a luxury sedan loaded with high-tech safety features, stickers at $57,500. But that price is reduced substantially by many factors we’ll discuss later. It can travel up to 312 miles on a fill-up and takes about five minutes to refuel from a growing network of hydrogen fueling stations around Los Angeles and San Francisco. Two “connector stations” — one along Interstate 5 and one on the 101 freeway in Santa Barbara — make it possible to drive the Mirai between L.A. and the Bay Area.

The Mirai is, in a sense, an electric car that gets its power from a fuel cell rather than from electricity stored in a battery. The main advantage of the fuel cell car over an electric car with a battery is faster fill-ups and a longer range.

How it drives

The Mirai is a midsize luxury sedan with touch screens, mounted in a swoopy dashboard, that provide stats on the driving experience, including fuel efficiency and battery charge levels (yes, it has a battery to briefly store electricity from its regenerative braking system, which activates a generator while braking or slowing down). The leather seats are comfortable and provide strong lateral support as if the car was built to be driven hard on winding roads.

A touch of the go pedal gives a surge of acceleration typical of electric cars. The Mirai’s drive train makes an assortment of soft sounds — whining and buzzing — many of which are typical of electric cars. Overall, the engine noise is nearly silent and the road noise is very low, delivering a solid, upscale ride.

On a very short test drive, the suspension was firm but comfortable, handling potholes with ease. The brakes were spongy and unresponsive, which is typical of hybrid and electric vehicles, due to the regenerative braking technology.

What’s included

The front-wheel drive Mirai comes in only one trim level, so the only decision you need to make is among the four available exterior colors. The sedan is packed with advanced safety features such as blind spot monitoring, lane departure warning, automatic emergency braking and adaptive cruise control. It also comes with several other perks:

  • Free fuel for 3 years, or up to $15,000 worth, whichever comes first.
  • An 8-year/100,000-mile warranty for the fuel cell components.
  • Free maintenance for 3 years/35,000 miles.
  • Roadside assistance for 3 years.
  • Complimentary rental car for trips outside the network of hydrogen fueling stations (up to 7 days per year).
  • Carpool stickers for the HOV lanes.
Pricing: A Nerd crunches the numbers

Leasing: Most customers will lease the Mirai, because technology is progressing quickly, and after the three-year lease is over, more advanced cars will be available. The lease payment is $499 a month for three years with $3,649 due at signing, totaling a pricey $21,613 for three years of ownership. But wait — a California Air Resources Board (CARB) rebate of $5,000 wipes out the down payment while also covering almost three monthly payments, bringing the ownership total cost to $16,613 for three years.

And it gets even better. Compare the Mirai, with its free hydrogen perk, with the similar-sized Toyota Avalon, which Fueleconomy.gov says has a $1,350 annual gas bill, and that adds up to a savings of $4,050. Now the out-of-pocket three-year total is only $12,563, or a monthly cost of about $350 (excluding registration and insurance costs).

Buying: Discounts and lease deals may pop up in the future. But for now, figure you will have to pay the sticker price of $57,500. Toyota sweetens the deal by offering 0% financing for 60 months. Furthermore, a $7,500 “Trailblazer” rebate and the $5,000 CARB rebate bring the price down to a still-pricey $45,000.

Knock off another $4,050 you don’t have to spend on gasoline, and you are at $40,950. Some buyers might also be able to use the $8,000 federal tax credit, which would bring the Mirai to an optimistic final price of $32,950 — about the price of a 2016 Toyota Avalon.

Nerd’s-eye view

There are many unknowns in the future of the fuel cell car. Perhaps the biggest is the availability and cost of hydrogen. If the hydrogen highway expands across the country and the cost of the fuel cell technology comes down, it could signal a clean alternative to gasoline-powered cars. But cheaper electric cars are already available, and charging stations are more plentiful. So you have to wonder whether the viability of fuel cell cars will perhaps remain 10 years in the future, after all.

Philip Reed is a staff writer at NerdWallet, a personal finance website. Email: preed@nerdwallet.com.

What to Buy (and Skip) in October

This month, you likely have costumes, candy, decorations and pumpkins on your list of things to buy, not to mention fall clothes and household supplies. There’s a lot to purchase, but shopping for the season doesn’t mean you have to spend a scary amount.

We’ve put together a guide of everything you should buy (and skip) in October so you can snag the sales and avoid paying full price.

Buy: Jeans

Historically, October has been one of the best times to buy jeans. The cold-weather staples have been on shelves since back-to-school season and retailers are now starting to discount them.

The autumn deals on denim have already begun as October approaches. So far, we’ve spotted buy one, get one 50% off jean promotions at stores like Express and American Eagle Outfitters. Buy your jeans this month to expand your wardrobe without breaking the bank.

Skip: Toys

Halloween hasn’t even arrived yet, but you may already be thinking about the holiday shopping season — and holiday toy season. Wal-Mart has released its 2016 holiday toy list, and Toys R Us has unveiled its 2016 Hot Toy List.

If you want to pay the lowest possible price for this year’s new gizmos and gadgets for your children, wait until December. Retailers usually discount toys close to Christmas. In 2015, Amazon offered sweeping toy discounts in the weeks preceding Dec. 25. So if your son or daughter is OK without having a shiny new Star Wars figurine right now, come December you might be able to give both Luke Skywalker and Darth Vader.

Buy: All things outdoor

Most people head indoors when the weather cools down, but October is a good time to focus your shopping on the outdoors. We’re talking about camping gear, patio furniture, outdoor living essentials and more.

Prices on outdoor products tend to be highest when demand is highest. But with summer becoming a distant memory, now is the time to act if you need new camping supplies.

For example, Cabela’s is hosting a 40% off sale on camp furniture. At Lowe’s, Weber Genesis gas grills are now $100 off.

Skip: Electronics

Buy a tent? Sure. But you won’t want to fill your shopping cart with major electronics this month.

We recommend that you hold off on picking up that new laptop, tablet or HDTV for a little while longer. The best time of the year for electronics deals, Black Friday, is just around the corner. You’ve waited this long, so keep up that discipline until the post-Thanksgiving deal blitz arrives on Nov. 25.

In 2015, Black Friday was a blowout. Wal-Mart sold a 50-inch TV for $269. Best Buy took up to $125 off the iPad Air 2. Target slashed Beats headphones by over $100. Deals are expected to rival these levels again in 2016, especially for shoppers who get in line early.

Buy: Halloween candy

In 2015, shoppers who celebrated Halloween planned to spend a total of $2.1 billion dollars on candy alone, according to the National Retail Federation. If you’re one of these spooky celebrants, you’ll likely be looking to buy candy in bulk again this year.

It’s difficult to buy Halloween candy in any month other than October. After all, you don’t want your Reese’s and Butterfingers to go bad before the trick-or-treaters arrive.

We recommend waiting until the end of October to make your purchase. Retailers will be more eager to unload their stock of Halloween supplies — that means costumes and decorations, too — as the holiday draws near. Also, consider bulk candy retailers like Costco or Oriental Trading Co. to lower your average cost per unit.

» MORE: What to buy every month of the year

Skip: Cleaning supplies

If you need a new vacuum cleaner or other floor care device, don’t act this month. If you can get by with your current model for a while longer, you can expect deep vacuum and cleaning supply sales in late November or early spring.

For instance, last Black Friday, we saw big sales on major vacuum brands from stores like Target, Best Buy and Costco. The Dyson V6 stick was up to $150 off, and the Dyson Cinetic Big Ball Animal vacuum was up to $170 off. We expect similar savings this season.

Shop: Columbus Day weekend sales

This Oct. 10, shoppers can commemorate the day Columbus set sail by sailing straight into a weekend full of deals. Department stores in particular are known to host sales in the days leading up to Columbus Day. Last year, Macy’s offered an extra 20% off select sale items, while J.C. Penney took up to 80% off an assortment of clothing and home goods. If you can, reserve many of your non-Halloween purchases for this weekend.

Bonus: National Taco Day

From National Selfie Day to National Coffee Day, there’s a quasi-holiday for just about anything. Restaurants particularly like observing food-themed days, as it gives them another opportunity to drum up business. This month, the day to look out for is Oct. 4, National Taco Day. In 2015, we spotted taco-themed discounts and deals at restaurants like El Torito and On the Border in honor of National Taco Day. Expect similar food freebies again this year.

Courtney Jespersen is a staff writer at NerdWallet, a personal finance website. Email: courtney@nerdwallet.com. Twitter: @courtneynerd.

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