Phones were ringing off the hook Saturday morning for the financial planners and credit counselors who volunteered for a free financial call-in program coordinated by the Akron Beacon Journal.
In all, more than 90 calls were taken by the volunteers, though the experts started to lose track of the number of calls they were taking with the fast pace of calls coming in.
On Wednesday, financial experts took 48 calls during the first of the two sessions, which ended with Saturday’s session.
It was the fifth year for the free program, co-sponsored by Apprisen, formerly the Consumer Credit Counseling Service of Northern Ohio, and the Financial Planning Association. Both made counselors and planners available to answer calls.
Certified financial planners Janice Cackowski and Doug Robinson said they took several calls with a similar theme: people who were 65 or older who wanted to know whether they should convert a conventional IRA into a Roth IRA to leave a legacy for their children. The parents wanted to pay taxes on money now to allow the money to continue to grow without a burden of taxes later for their children.
Cackowski and Robinson told callers that there was no straight answer. Converting the IRA to a Roth IRA is a viable option, but they advised that the callers talk to a tax professional to see what they could afford, what made sense for when they should make the conversion and how much to convert while keeping them in a lower tax bracket.
Apprisen counselor Greg Radosevich took a call from a woman who told him she was living paycheck to paycheck. She used her credit cards all of the time and while she was making payments, she still carried balances on the cards. She wondered about consolidating the debt and transferring to a new card with an introductory offer of zero percent interest for a certain amount of time.
Radosevich talked to the woman about budgeting. He also suggested that she change how she used her yearly tax refund, which has been around $4,000 and which she has used traditionally to catch up on bills or home maintenance projects. She should instead use that to establish a savings so she doesn’t have to rely on the credit card so much.
Apprisen offers free 1-hour sessions to consumers to help with budgeting and to talk about whether debt payment plans are worthwhile for them. To schedule an appointment, go to www.apprisen.com or call 800-355-2227.
Cackowski received several questions about mortgages. One caller said the family had $150,000 left on the mortgage for a house that was worth $300,000. The caller also had about $12,000 in credit card debt. The caller wanted to know whether it was wise to refinance the house or get a home-equity loan to pay off the credit card debt.
Cackowski said it was OK to refinance the house to get to a lower interest rate for the house and credit card debt, but that it was imperative that the person not run up the credit card debt again. She suggested that there was a budgeting problem and the person needed to look at the family’s budget. She also said the family needed to be careful because they were increasing the debt on their house for the credit card debt.
Apprisen counselor Cheryl Hall took a call from a father who had co-signed student loans with his adult son, but was just finding out that the son has fallen behind. The loans are worth $35,000 and the father has $8,000 he could pay. Hall suggested that the father look up his credit report to find out about the loan and come up with a plan with the son to work out payments for the loan.
People often have the wrong impression that a financial planner is too expensive. Robinson and Cackowski said planners can charge a flat fee, an hourly fee or work on commission based on products. Often, people don’t need a full financial plan, and just need to get guidance from a professional. To find a financial planner, go to www.fpanet.org or www.cfp.net.