Your Money Adviser: Starting to Build a Credit History

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Your Money Adviser: Mobile Banks Gaining Popularity With Young Consumers

Then she heard about GoBank, one of a new breed of mobile banking services aiming at fee-averse customers, especially 20-somethings or “millennials,” accustomed to doing everything on their smartphones. She now uses it as her sole bank.

Ms. Goetze is a fan of a GoBank feature that lets her check her balance quickly on her phone, without having to log in to her account. “I love, love, love it!” she said. She doesn’t pay any monthly fee; GoBank lets users choose their fee (from zero to $9 a month), and right now she opts to pay nothing. But she said she may start paying $1 a month, now that she has been using GoBank for a while and likes it. She estimates she would have had to pay about $12 a month with a traditional account.

Old-fashioned banks, of course, also offer mobile banking apps, and branchless banks aren’t new either. But the upstarts, which include Simple and Moven, especially appeal to younger customers and others on a tight budget because they shun most fees, including dreaded overdraft fees, and have no minimum balance requirements. Each differs slightly in their offerings, but all aim to simplify payments and help users closely track their spending. They’re meant to be used when customers are on the fly, rather than sitting down at a computer.

The new alternatives work with traditional banks to hold deposits, so the money in your account is F.D.I.C.-insured. GoBank is the mobile banking arm of the Green Dot Corporation, which markets reloadable prepaid debit cards and owns Green Dot Bank, which holds the funds deposited via GoBank. Simple and Moven are in effect banking services, rather than banks, but they work with traditional banks to handle the actual banking functions behind their mobile apps. Simple’s deposits are held at Bancorp Bank, based in Delaware (a spokeswoman said Simple may also partner with other banks in the future as it grows), while Moven’s are held at CBW Bank, which is based in Kansas. But customers access the service through their mobile apps or websites.

The new mobile banks are gaining in popularity. Simple became available to the public in July 2012 and now has about 80,000 customers, said a spokeswoman, Krista Berlincourt. Simple currently requires users to email a request for an invitation to join, before allowing them to register. The approach acts as a fraud deterrent and also lets the company ramp up its systems to meet demand, she said.

Moven is still in its testing phase, and also asks customers to submit an invitation, said Alex Sion, Moven’s president; he says the service has “a couple of thousand” customers. One of its distinctions is that it offers users the option to make payments directly from their phone, by tapping the phone on a payment terminal, he said.

The new mobile models are evolving, but show promise by focusing on what the customer wants to do, rather than relying on banking terms that most millennials don’t care about, said Jennifer Tescher, chief executive of the Center for Financial Services Innovation. Simple’s users, for instance, can see their “safe to spend” balance, which takes into account pending bills. Young people like to have quick access to check their balances, she said, because they have been hard hit by the slow economy and are on tight budgets. “They care about having a terrific user experience that’s easy to use and understand, and works in real time,” she said.

Jim Bruene, founder of the Netbanker blog, said the new mobile banks had a “hip” aura that appeals to young people. GoBank, for instance, offers a budgeting tool called Fortune Teller. Users can ask whether a purchase for a certain amount is a good idea, and the system will respond based on your spending — usually with a mildly sarcastic remark (“Think. When did you last see your mind?”).

Email: yourmoneyadviser@nytimes.com

Your Money: Finance Class on the Web, for Students of All Ages

After all, there are few entirely conflict-free places where investors can educate themselves on the topic, and there’s little to no money-related guidance offered within the public school system, which is where the financial groundwork should really be laid.

Joshua Rauh, a finance professor at the Stanford Graduate School of Business, is acutely aware of that. And it’s why he felt compelled to open his graduate-level course on the finance of retirement and pensions to the masses. “My goal is to try to empower people to make better decisions about their finances with an eye toward retirement and for retirees who are thinking about managing their money,” Professor Rauh said, “whether it is buying an annuity or having a spending rule.”

The course, which is offered free online, begins on Monday. I sat for nearly half of his online video lectures — on topics like “saving for retirement” and “making smart decisions as a stock market investor” — earlier this week. Watching remotely means you won’t be party to the discussion that will emerge from the Socratic method Professor Rauh uses in his traditional classroom on campus. And there are already 13,000 students, so it’s hard to expect any personal attention.

But there’s plenty that students will take away from his lessons, which you can watch anytime after the lecture is released, much as you might watch any series on your DVR. “A person that would really benefit is someone who is 40 and realizing they really need to start putting together a plan for retirement and haven’t thought much about it,” he said, though he says he believes that it will be equally helpful for people of all ages.

There aren’t many other places to turn, particularly where it costs nothing but your time. When I informally polled financial literacy advocates, financial planners and other experts if they knew of any other comprehensive retirement courses, they couldn’t come up with any, though one person mentioned the instructional videos at Khan Academy. (If you know of any classes, please share them in the comments section online).

Without any instruction manual, “people have to be their own chief financial officer,” said Annamaria Lusardi, a financial literacy advocate and economics professor at the George Washington University School of Business, who teaches a class on personal finance. “The large majority of the population lacks the knowledge of basic but fundamental concepts, from the power of interest compounding, to the effects of inflation, to the workings of risk diversification.”

This course may be a good place to start. Each of the 10 video lectures are about 45 minutes long, but they’re broken into bite-size segments, all of which were well produced and relatively engaging. As Professor Rauh explains each concept, animated visuals and colorful graphs appear alongside him, which helps make the concepts easier to grasp.

Each lecture includes a mix of financial theory and prescriptive advice, some of which people with a reasonable base of investment knowledge may already know: actively managed mutual funds aren’t worth the money, so buy index funds. Don’t time the market. Stocks don’t become less risky the longer you hold them.

But the illustrations that accompany the advice — how retiring in 2009, for instance, would have resulted in a nest egg 28 percent smaller than one resulting by retiring in 2012 — are instructive. “It’s not a rocket science idea, but people don’t see it without having it illustrated for them,” Professor Rauh said.

All of the lessons are rooted in what he calls “the economist’s view” of personal finance, which is built on the idea that there are no free lunches in financial markets, and that you can generate potentially higher returns only if you take substantial risk as well. It’s a message woven through his lectures. At times, it almost seems as if there should be a red blinking sign behind Professor Rauh that reads, “Proceed with caution. Stocks ahead!”

He clearly wants the lesson to linger long after you leave his virtual classroom and find yourself in a commission-based stockbroker’s office. “Too often, people just budget on the basis of an ‘expected return’ on their assets without thinking about the range of possible outcomes,” he explained.

He also explains why economists also believe that more people — not all, but more — should buy annuities. Not the high-priced complex contraptions sold to unwitting seniors, but the plain-vanilla immediate annuities, where you pay a giant pile of cash to an insurance company in exchange for a guaranteed stream of income for life.

Your Money Adviser: Annual Enrollment for Medicare Opens

Traditional Medicare covers hospital stays and outpatient visits on a fee-for-service basis, and you don’t need to do anything if you’re satisfied with your coverage. But if you buy an additional Medicare Part D prescription drug plan, or if you have chosen coverage through a private Medicare Advantage managed care plan, it’s wise to pay close attention, because details can change significantly from year to year. Premiums may go up, drugs may be dropped from the menu of covered medicines and doctors you like to visit may leave your network.

“The decisions you make in open enrollment can impact you for the entire year, or even longer,” said Nicole Duritz, the vice president of health education and outreach at AARP.

Medicare Advantage plans often carry low or even no premiums and most include prescription drug coverage, so they’re often attractive to people on fixed incomes. They usually restrict care to a network of doctors, however. Offerings vary widely from state to state, and even within states. About 14 million people, or more than a quarter of Medicare beneficiaries, are enrolled in the plans.

The federal Department of Health and Human Services says the average Medicare Advantage premium for 2014 is expected to be $32.60 a month, up $1.64 over this year. But premiums vary and it’s possible some plans may have much larger increases. The federal government has been cutting payments for the plans to bring costs into line with those for traditional Medicare.

Fred Cicetti, a 72-year-old retiree in Lincoln Park, N.J., said he was dismayed to learn that his insurer had discontinued his no-premium Advantage plan for 2014; a plan being offered with relatively comparable coverage came with a premium of $153 per person. That meant more than $300 a month to cover himself and his wife.

By calling around, he was able to find another plan with roughly the same coverage through a different insurer, with a premium of about $70 a month. “We found a solution that works for us,” he said. “But people really have to dig.”

If you have traditional Medicare and buy a stand-alone plan for prescription drug coverage, there are more choices this year, according to an analysis from the nonprofit Kaiser Family Foundation. Medicare beneficiaries will, on average, be able to choose from 35 drug plans, up from 31 last year, the report found. Most plans now use “preferred” pharmacy networks, so you’ll pay more if you buy your medicine elsewhere.

Most people don’t change drug plans, even though those who do switch often save money, a separate report from the Kaiser Foundation found. “People do tend to stick with the plan they’ve selected,” said Patricia Neuman, a Medicare policy expert and one of the study’s authors.

That may be because it is time-consuming for seniors to sit down with all their medications and calculate what their costs would be under a new plan, compared with their current plan, she said. “A lot of people think the juice is not worth the squeeze,” she said.

The federal government estimates that the average monthly premium for Medicare drug coverage in 2014 will be $31.

Here are some questions about Medicare open enrollment:

¦ Will the current federal government shutdown affect Medicare open enrollment?

The federal Centers for Medicare and Medicaid Services, the government agency that oversees Medicare, says open enrollment won’t be delayed.

¦ Where can I review my Medicare options?

Go to the Medicare Plan Finder at Medicare.gov. (Don’t go to the new federal health care exchange created by the Affordable Care Act; that’s for people under 65 who want to shop for private insurance coverage, not for people on Medicare.)

¦ What if I’m confused about my choices?

You can call Medicare at 800-633-4227. Or if you prefer help in person, try the State Health Insurance Assistance Program, known as SHIP. A list of programs by state is available on the program ‘s Web site.

Listening Post: China Rails at U.S., Seeing Its Own Money at Risk

But China does not have many options beyond wringing its hands. Despite its efforts to steer its economy away from exports and toward domestic demand, China generates billions of dollars of excess cash that it needs to park somewhere. And for all the chaos in Washington, Treasury bonds remain a safer investment than most of the alternatives.

That dependence may help explain the stridency of a recent commentary published by the official Xinhua news agency. It called for the replacement of the dollar as the world’s reserve currency “so that the international community could permanently stay away from the spillover of the intensifying domestic political turmoil in the United States.”

“As U.S. politicians of both political parties are still shuffling back and forth between the White House and the Capitol Hill without striking a viable deal to bring normality to the body politic they brag about,” the news agency said, “it is perhaps a good time for the befuddled world to start considering building a de-Americanized world.”

Chinese officials made similar noises five years ago, when the United States was being buffeted by a banking crisis. In March 2008, the leader of China’s central bank, Zhou Xiaochuan, proposed creating a new “supersovereign currency” that would diminish the importance of any individual national currency, not least the dollar.

But economists who follow China’s monetary policy say that while Beijing has somewhat diversified its foreign exchange reserves, it continues to rely heavily on Treasury bills and other American government-backed debt.

Part of the problem is the lack of easy alternatives: euro-denominated debt has been hurt by the European Union’s crisis, except in Germany. Analysts estimate that 60 percent of China’s $3.66 trillion in reserves are still in dollar-denominated debt, though the precise numbers are a secret.

In its commentary, Xinhua embellished its call for a new reserve currency with a scathing indictment of the United States’ broader role in the world, saying that the Obama administration claimed “the moral high ground” while covertly “torturing prisoners of war, slaying civilians in drone attacks and spying on world leaders.”

Edwin M. Truman, an economist and former Treasury Department official, said: “This is political blather. It is a politically defensive response to the choices China has made.”

That does not mean a brush with default will not have long-term damaging consequences for the United States. Even if China continues to buy Treasury bonds, economists said, it may opt for those with shorter maturities, which would drive up long-term interest rates in the United States, hurting home buyers and owners of small businesses.

The sour taste from the budget impasse will also motivate the Chinese to intensify their efforts to deepen their own debt markets. Already, China has negotiated swaps for its currency, the renminbi, with the European Central Bank and other institutions, a step toward making the currency convertible and, someday, a rival to the dollar and euro.

“This gives them a kick in the pants to do it,” said Kenneth S. Rogoff, professor of public policy and economics at Harvard and a former chief economist of the International Monetary Fund.

Any decline in the status of the dollar will be gradual, said Mr. Rogoff, who pointed to the erosion of the British pound sterling over several decades as a precedent. But, he said, “Memories are long: you do this once, you do this twice, and people start to think.”

President Obama appeared to have those long-term effects in mind when he was asked last week what message he had for big bondholders like the Chinese and Japanese. After saying that he had assured world leaders that the United States would continue to pay its bills, he noted that the specter of default, and the fact that the United States had flirted with it once before, could sow lasting doubts overseas.

“We saw what happened in 2011,” Mr. Obama said. “I think the assumption was that the Americans must have learned their lesson, that there would be budget conflicts, but nobody again would threaten the possibility that we would default. And when they hear members of the Senate and members of Congress saying maybe default wouldn’t be that bad, I’ll bet that makes them nervous. It makes me nervous.”

For all the anxiety, though, the prevailing belief overseas is that the United States will avert a default. At last weekend’s meetings of the World Bank and I.M.F. in Washington, Mr. Rogoff said, none of the visiting finance ministers expressed genuine fear that Congress and the White House would not find a way out.

The fiscal deadlock, he said, cast such a long shadow over the gathering that the ministers did not have to dwell on the financial and structural problems in their own economies.

China is a case in point. While the Chinese government has taken steps to shift its economy from a dependence on exports toward one fueled by domestic demand, the progress has been fitful. At the behest of its exporters, it continues to artificially depress its exchange rate, which it does by using its export earnings to buy dollars and other foreign currencies.

In the first quarter of this year, economists say, the Chinese government added more to its foreign exchange reserves than in all of 2012.

On one level, China’s $3.66 trillion hoard is a symbol of its financial might. But on another, it has tied Beijing’s hands. China’s central bank, the People’s Bank of China, cannot dump its Treasury bonds without driving down their value and incurring a painful loss on paper.

“This is certainly a wake-up call for them that holding U.S. government securities is not risk-free,” said Nicholas R. Lardy, an expert on the Chinese economy at the Peterson Institute for International Economics. “What they should be doing is quit adding to their foreign reserves.”

This article has been revised to reflect the following correction:

Correction: October 15, 2013

An earlier version of this article misspelled the name of the president of China’s central bank.  He is Zhou Xiaochuan, not Zhao.

Your Money: Questions Often Asked About Health Law

Those who managed to create accounts or peruse the plans offered in their state left with many questions about the Obama administration’s health care plan. Among them: What does all of this mean for my 26-year-old child, who is now too old to remain on my own policy? The premium subsidies are based on my income, but what if I have no idea what I may earn next year? How is “modified adjusted gross income” calculated anyway?

Last week, my column addressed the broad outlines of how the exchanges will work, from how the different tiers of coverage would be structured to what types of individuals would qualify for tax credits on their premiums.

Dozens of additional queries landed in my in-box this week. Here’s are some of the most frequently asked questions and an attempt at answering them:

Q. I haven’t seen any discussion about students. My son will be 26 next month, and thus can no longer be on my plan. He is a full-time student in another state and fully dependent on my financial support. Do you know where he fits into this system?

— Mark Alper, Berkeley, Ca.

A. Adult children lose coverage through a parent’s policy on their 26th birthday. But they can then immediately enroll on the exchange — even outside the open enrollment period, which ends on March 31. Individuals under age 30 may also qualify for a “catastrophic” plan, which carries a lower premium but a very high deductible (equivalent to the out-of-pocket maximum, or $6,350 for a single person, in 2014). Tax credits, however, cannot be applied to catastrophic plans.

Q. My difficulty and confusion is I don’t actually know what my annual income is or will be in the coming fiscal year. I am a freelance classical musician, meaning I have seasonal employment from as many as 20 employers in a year and I file tax returns in seven states and three countries.

— gibarian, San Francisco

A. The experts I spoke with said you needed to make your best educated guess when estimating your income. The exchange will verify it by checking your tax return from last year as well as your current income. (The federal government has contracts with firms that provide that information.) If your self-attested income varies by more than 10 percent when compared to those two sources, you will be asked to provide more documentation, according to a spokeswoman at the Department of Health and Human Services.

Q. I have very little annual personal income, but am fortunate to have other savings/resources that would allow me to pay for one of the better plans with higher premiums. (I have no access to any employer-sponsored plan). I am willing to enroll in one of these better plans on my state’s health exchange even if I don’t get any subsidy for it. (I seem to earn too little to qualify for a subsidy anyway.) Will I be allowed to do this, and do this without penalty or added taxes?

— KRyan, New York City

Q. I am currently unemployed but have a sizable trust fund. Do I qualify for discounts/tax credits when buying health insurance? Will I be required to show my federal tax return?

— Jory, Columbus, Ohio

A. You can certainly buy coverage on the exchanges when you don’t have coverage through an employer. Whether or not you pay full price or qualify for a premium tax credit depends on your modified adjusted gross income, which is based on your latest tax return (and yes, the exchanges will check your return).

If your household’s modified adjusted gross income is from 100 to 400 percent of the federal poverty level (that’s $11,490 to $45,960 a year if you’re filing as an individual and $23,550 to $94,200 for a family of four), you may be eligible for a premium tax credit, according to CCH, a tax and accounting service.

Several readers had questions about how the modified adjusted gross income is calculated. It’s basically your “adjusted gross income,” which can be found on line 37 of your 1040 tax return form. But it requires that you add back certain items like nontaxable Social Security income, tax-exempt interest and foreign-earned income, Mark Luscombe, a principal analyst at CCH, said.

The figure also includes income from items like dividends, interest, real estate and retirement account withdrawals. So even if you do not have much earned income, but have significant income from other sources, you obviously won’t qualify for financial assistance.

Premium tax credits and cost-sharing subsidies are generally based on your household income, which includes your spouse and any dependents for whom you file a personal exemption and who also earn enough money to file a return, he added.

Q. I get insurance through my employer. My same-sex husband has little to no income and will be using the exchange. Our state of residence (Virginia) is letting the federal government run the exchange. Our state does not recognize our marriage, but the Internal Revenue Service does. How will he determine income when using the exchange?

— S.G., Eastern U.S.

A. The I.R.S. said last month that all married same-sex couples would be treated as married for federal tax purposes, regardless of where they live. And starting in the 2013 tax year, all married couples will be required to file their returns together as either “married filing jointly” or “married filing separately.”

The insurance exchanges will also see you as married. In fact, if you’re a married couple buying insurance on the exchange — gay or straight — you’re required to file a joint federal return, the Treasury Department said. (Why? Imagine how many more people would qualify for subsidies if they used “married filing separately” status.)

Your Money: A Guide to the New Health Insurance Exchanges

But after much anticipation, the curtain will finally rise on the exchanges next week, providing millions of consumers with an online marketplace to compare health insurance plans and then buy the coverage on the spot.

The exchanges are likely to be most attractive to people who qualify for subsidized coverage. Individuals with low and moderate incomes may be eligible for a tax credit, which can be used right away, like a gift card, to reduce their monthly premiums. People with pre-existing conditions will no longer be denied coverage or charged more (this applies to most plans outside the exchanges, too). And all of the plans on the exchanges will be required to cover a list of essential services, from maternity care to mental health care.

“In today’s individual market, it’s like Swiss cheese coverage,” said Sarah Dash, a research fellow at the Health Policy Institute at Georgetown University. “Consumers should have an easier time figuring out what they are getting for their money.”

But it’s still going to take some time to analyze the plans and their costs, which are expected to vary widely across the states. And the coverage may still pinch many families’ budgets. Fortunately, there’s a six-month window, from now to March 31, for people to figure it all out.

Here’s some information to get you started:

Q. Where can I apply or get more information on the exchanges?

A. To avoid fraud artists, enter through the front door: Healthcare.gov. From there, you can find links to the exchange offered in your state. Alternatively, you can call 1-800-318-2596.

Q. When does coverage go into effect?

A. You can apply as early as Oct. 1, but coverage won’t begin until Jan. 1. The enrollment period for coverage in 2014 closes on March 31, 2014. After that, you can enroll only if you have a major life event like a job loss, birth, marriage or divorce.

Q. What sort of coverage will be offered?

A. All plans will have to provide the same set of essential benefits, including prescriptions, preventive care, doctor visits, emergency services and hospitalization (this also applies to most individual and small-employer group plans sold outside of the exchanges). Plans can offer additional benefits, or different numbers of visits for services like physical therapyso you’ll need to do a side-by-side comparison to see what fits your needs — or at least the needs you can anticipate.

Q. How are the plans structured?

A. There are four plan levels, each named for a precious metal. They all generally offer the same essential benefits, but their cost structures vary. The lower the premium, the higher the out-of-pocket costs.

The bronze level plan, for instance, has the lowest premiums, but will require consumers to shoulder more costs out of pocket. They generally cover 60 percent of a typical population’s out-of-pocket costs, and include deductibles, co-payments and coinsurance. The silver plans cover 70 percent; gold, 80 percent; while platinum covers 90 percent (and therefore carries the highest premiums).

If you buy a plan on an exchange, your annual out-of-pocket costs cannot exceed $6,350 for individuals and $12,700 for a family of two or more in 2014. Catastrophic plans are also available to people under age 30 or those suffering a financial hardship. These carry high deductibles (equivalent to the out-of-pocket maximum, or $6,350 for a single person, in 2014). You cannot apply tax credits to these plans, either.

Premiums will vary across the states because of a variety of factors, from market competition and the underlying cost of care to the negotiating power of the exchanges, according to Kaiser research.

Q. If the costs with plan levels are similar, how will plans differ within the metal levels?

A. Networks of doctors and hospitals will differ, and cost-sharing structures may also vary. One plan might have lower deductibles and higher co-pays, whereas another plan may have a separate deductible for prescriptions. Various medications may also be covered differently. “If you are someone who is taking medicines, make sure you know what your drugs will cost in the various plans being offered,” said Cheryl Fish-Parcham, deputy director of health policy at Families USA, a Washington consumer advocacy group.

Q. Will I be eligible for a premium tax credit (subsidized coverage)?

A. People with income between 100 percent of the poverty line (or about $23,550 for a family of four) and 400 percent of poverty ($94,200 for a family of four) are eligible for a tax credit to defray premium costs. (All income eligibility is based on your modified adjusted gross income; the online version of this column links to a guide explaining how that is calculated).

The tax credits are set up so that consumers will not have to pay more than a certain percentage of their income, ranging from 2 percent for those with incomes of up to 133 percent of the poverty level ($15,282 for a single and $31,322 for a family of four) to 9.5 percent for those with income of 300 to 400 percent of the poverty level, according to the Center on Budget and Policy Priorities. The dollar amounts of the credits are calculated based on the costs of the second-to-lowest-cost silver plan available to you.

Kaiser has a calculator that can give you an idea of your eligibility.

Q.Can I get help with my out-of-pocket expenses, like deductibles?

A. People with incomes between 100 percent of the federal poverty line ($23,550 for a family of four) and 250 percent ($58,875 for a family of four) are also eligible for cost-sharing reductions, which means you’ll pay less for items including deductibles and co-payments, and you’ll have lower out-of-pocket maximums.

Your Money: Tighter Rules Will Make It Harder to Get a Reverse Mortgage

Now the rules are about to change again.

As a result, some people with heavy debt who were hoping a reverse mortgage would solve their financial problems may find that it is no longer a viable option. Under the new rules, which go into effect on Sept. 30, many borrowers will be able to get access to even less of the value locked in their home — about 15 percent less — compared to the maximum available now. The rules also put new limits on the amount of money that can be taken out in the first year, which may further deter the most distressed prospective borrowers.

“The changes really put the product on track as a long-term financial planning tool as opposed to a crisis management tool,” said Ramsey Alwin, senior director of economic security at the National Council on Aging.

The Federal Housing Administration, which insures most reverse mortgages, is making the changes in an effort to strengthen the program, which allows people 62 and older to tap their home equity without making payments. Lenders get their money back once the house is sold.

Since the economic crisis, more homeowners withdrew the entire pile of cash they were eligible for all at once, which strained the program’s reserve funds (lenders were also paid more when borrowers took large sums, and reverse mortgage experts say lenders prodded borrowers in this direction). Declining home values also hurt the program’s overall finances, since lenders often could not recoup the full loan amounts when the houses were ultimately sold.

The F.H.A. hopes that the changes, particularly the limits on how much can be withdrawn in the first year, will encourage people to tap their home equity slowly and steadily, in a way that will enable property owners to stay in their homes as they age. That’s a change that several consumer advocates, along with members of the industry, agree was necessary.

Up until now, just about anyone could qualify for a reverse mortgage. But perhaps the biggest change to the program will go into effect early next year, when borrowers will also need to prove that they have the wherewithal to pay property taxes and insurance over the life of the loan. If they cannot, they will have to set that money aside — and that could consume much of the loan’s proceeds.

There is still a little time to get a mortgage using the current program. As long as prospective borrowers go through the required financial counseling and receive a case number before Sept. 28, they will be able to qualify under the current rules.

Here’s a closer look at how the changes will affect prospective borrowers:

FIRST-YEAR LIMIT There will now be a limit on the amount of money that can be withdrawn in the first year. A homeowner eligible to withdraw a total of $200,000 in cash, for example, would be allowed to get only $120,000, or 60 percent of that sum, in the first year.

There are exceptions. Some homeowners will be able to draw a bit more if their existing mortgage, along with other items like delinquent federal debts, exceed the 60 percent limit. Homeowners are required to pay off those items — which regulators call “mandatory obligations” — before qualifying for the loan. So borrowers can withdraw enough to pay off these types of obligations, plus another 10 percent of the maximum allowable amount (in this case that’s an extra $20,000, or 10 percent, of $200,000).

Credit cards are not considered a mandatory obligation, so people with significant credit card debt may find they can’t withdraw enough money to pay those loans off, said Christopher J. Mayer, professor of real estate, finance and economics at Columbia Business School, who is also a partner in a start-up company, Longbridge Financial, that provides reverse mortgages. “There will be fewer financially distressed borrowers for whom a reverse mortgage will provide a satisfactory solution,” he added. “The product will be more attractive for people using it as part of a retirement plan.”

Your Money: Gay, Married and a New Land of Federal Taxation

Many of those couples who fought long and hard to win that right may pleasantly find themselves paying Uncle Sam far less and may even get a refund from previous years. (But plenty of others will pay more.)

The Internal Revenue Service this week set down the rules that will cost or save a particular couple money. That will depend on how much they earn, whether both spouses are working, and whether, together, they earn too much to claim the same sort of tax-saving deductions and credits they did when they were filing as singles (many of which phase out as income rise).

The rules also begin to clarify how couples residing in the 37 states that do not sanction same-sex marriages will fare. (Warning: Filing state returns won’t be easy, but not so bad that you’ll consider moving.)

Gay couples can now plan for how their financial lives will change when it comes to federal taxes, even though big questions remain about benefits like Social Security and veterans’ benefits. The ruling applies to a broad range of tax rules where marriage comes into play, and some will result in major savings. Some couples will no longer have to pay thousands of dollars in taxes on the value of their spouse’s health insurance, something their opposite-sex peers did not have to pay. Individuals can inherit a spouse’s retirement account and other assets without any extra tax implications. Nonworking spouses will be able to open an I.R.A. on their spouse’s earnings record. And the list goes on.

“The Supreme Court opened the door to nationwide recognition of same-sex marriage, but the Internal Revenue Service swung it wide open,” said John McGowan, who heads the lesbian, gay, bisexual and transgender practice at Northern Trust.

First the best news: If you would have received a refund by filing a joint federal return, you can generally collect that money for the last three years. (Keep reading, I’ll tell you how below). If you would have owed money, you are under no obligation to pay more.

For the 2013 tax year, all legally married couples will be required to file their returns together as either “married filing jointly” or “married filing separately,” according to the Treasury and Internal Revenue Service, which announced the rules on Thursday. That’s the case even if, for instance, a gay couple legally married in the District of Columbia goes back home to Virginia where gay unions are not allowed.

Here are some answers to several questions that may be on couples’ minds:

WILL I OWE MORE TAXES OR LESS? Generally speaking, couples will pay less in federal income tax when one person earns much less than the other or does not work at all. High-income couples with two working spouses will probably pay more. That’s the marriage penalty. You’re welcome.

A married same-sex couple in which one spouse earns $100,000 and one stays at home with their child will save about $4,200 in federal taxes by filing a joint federal return, according to Pan Haskins, an accountant in Oakland, Calif., who works with gay couples.  (If the same couple lived in a community property state like California, Washington or Nevada, their federal taxes would be the same as married couples in other states, but they would pay about $600 more than they pay now.)

RETROACTIVE REFUNDS? If a couple would have received a federal tax refund had they filed a joint return, they are entitled to claim that money for three years from the date the return was filed or two years from the date the tax was paid, whichever is later, according to the I.R.S. So generally speaking, most people will be able to amend their returns for 2010, 2011 and 2012. Taxpayers should use I.R.S. Form 1040X, which will allow them to amend previous returns.

AM I OWED ANYTHING ELSE? Perhaps. Unlike straight married couples, most gay individuals with same-sex spouses who were covered by their employer’s health plan owed income taxes on the value of that coverage (unless the employer paid them for the employee, which some companies did). In addition, these workers also paid for their portion of the premium using after-tax dollars instead of being able to pay pretax and reduce their taxable income.

If you paid those extra taxes, you can claim a refund on both of those items, according to the I.R.S. (which said it would be issuing streamlined procedures to help taxpayers). So if you paid extra income taxes on, say, $3,000 worth of health insurance annually for each of the last three years, or $9,000, you could get a nice chunk of money back, depending on your tax bracket.

WHAT ABOUT STATE TAX RETURNS? If you live in a state that recognizes your union, your life just got much easier. Couples residing in places like California, Massachusetts or New York can file a joint federal tax return as well as a joint state return, just as opposite-sex couples do.

But it’s not entirely clear what will happen in each of the states that do not recognize same-sex marriage, experts said, since some states require that a taxpayer’s state return filing status mirror their federal return. “I love that state taxing authorities are having to wrestle with this,” said Patricia Cain, a professor at Santa Clara University School of Law and an expert on sexuality and federal tax law. “It does remain to be seen, but it is likely that you won’t be filing jointly at the state level” if your state does not recognize your union.

If that’s the case, filing your state tax return will become more cumbersome. Each spouse will probably need to fill out a dummy federal return as if they were filing on their own (either as single or head of household) and then transfer the information on that return to their state return, which also must be filled out as single or head of household, according to tax experts. “It will be awkward, it will be time-consuming, but not necessarily difficult,” said Nanette Lee Miller, who leads the lesbian, gay, bisexual and transgender practice at Marcum, an accounting firm.

Your Money: One Dip Into a 401(k) Often Leads to Another

After workers borrow money from their 401(k) retirement account, they may find that it becomes easier to come back for another loan — and perhaps even another. And yet another one after that.

Fidelity, which houses the 401(k) plans of more than 12 million workers, recently studied the behavior of these so-called serial borrowers. It found that this sort of repeat borrowing can put a serious dent in long-term savings, especially if the employees cannot continue to save as much while they pay the loan back.

And that’s what tends to happen with this group. “Once they broke the barrier, they went back and took more and more,” said Jeanne Thompson, vice president for market insights at Fidelity. “They find it’s probably easier than going to the bank to get a loan, so it becomes a bad habit.”

This type of borrowing can be a most attractive alternative to banks: the average interest rate for a 401(k) loan right now is about 4.25 percent (most plans add one percentage point to the prime rate, according to the Plan Sponsor Council of America’s 2011 report, though the formula does vary across plans). With the exception of a mortgage refinance, and perhaps a home equity line of credit, it is hard to beat that rate. Compared with credit cards and personal loans, which now average 15.31 percent and 11.41 percent, according to Bankrate.com, it seems prudent.

The government does not take a 10 percent penalty on the amount borrowed, as it does when a person cashes out of a 401(k) before retirement.

By and large, it looks like sensible people are using this vehicle. Repeat customers, Fidelity found, were typically in their 40s and 50s: people who have saved enough to actually take multiple loans and who also have a lot of competing needs: college tuition, perhaps, and aging parents to look after.

Ms. Thompson also suspects they’re using the money to pay off medical bills and credit card debt, though call center representatives reported that at least some people are using the money for luxury items like Jet Skis and vacations. A small fraction of borrowers even took out loans as little as $200. On average, someone who took three or more loans over the 12-year period earned $80,000.

But how sensible is it? Fidelity studied the patterns of 180,000 borrowers who were active participants in a 401(k) plan over the last 12 years. Among this group, the majority — two-thirds of employees — took more than one loan over that time period. But 25 percent of borrowers came back for a third or fourth loan, while 20 percent came back to their retirement account five times or more.

Even though borrowing appears to beget more borrowing, other experts cautioned that these workers may not be lacking self-control, but are simply using the loans to absorb some long-lasting financial shocks, like a spouse who lost a job. Over all, the number of 401(k) loans hasn’t significantly changed: about 10.6 percent of Fidelity plan participants took out new loans in the first three months of this year, which tracks close to the industry average. About 30 percent of all participants who took out two or more loans, or more than 1.7 million workers, still had more than one loan outstanding at the end of June.

“That a lot of people have more than one loan doesn’t mean that they are dysfunctional,” said David Laibson, an economics professor at Harvard who focuses on behavior. “It could mean a lot of things. It could mean that the household is in some financial distress. And for that household it might be a perfectly legitimate response.”

Fidelity didn’t survey the borrowers. It just observed their behavioral patterns. But it did find that the amounts that people borrowed decreased over time, particularly when they had taken at least three loans. “It’s almost a different mind-set versus the people who take just one,” Ms. Thompson posited.

Whatever the reason, it’s clear that serial borrowing can permanently impair your long-term savings. The money is no longer invested, so you may lose investment earnings. (When you borrow from a 401(k), the money is taken from your account, without penalty, and you pay yourself back with interest, typically through payroll deductions.)

Your Money: Win a Lottery Jackpot? Not Much Chance of That

This is exactly the sort of logic that, over the last year, led millions of people to spend $5.9 billion of their hard-earned dollars on Powerball alone. They spent nearly $69 billion on all lottery games in 2012, according to two lottery trade groups.

It is also precisely the kind of mental trap the Powerball people want you to fall in; they tweaked the game rules last year, doubling the price of tickets to $2 to raise more revenue and create more eye-catching jackpots.

And the state agencies running the games advertise heavily that it could be you making off with millions of dollars.

The odds of winning, however, remain infinitesimal: Powerball players, for instance, have a 1 in 175 million chance of winning. You have roughly the same chance of getting hit by lightning on your birthday.

Even though some people may be able to intellectually grasp what that means, the Multi-State Lottery Association can predict with clocklike certainty that on Saturday night, with a jackpot worth about $40 million, 13 million to 15 million people will buy tickets. Those ticket buyers are all thinking they have a shot of defying the odds.

That is why the lottery is called a tax on people who don’t understand math. Lower-income individuals who play but don’t win are hurt the most because they’re wasting a greater share of their income on the games. That’s also why the lottery is often called a regressive tax on the poor.

Sure, last year the games returned $19.41 billion to the states that sponsored them, according to the North American Association of State and Provincial Lotteries, which represents 52 lottery groups. But that’s not why anyone plays them.

What’s the big motivation to volunteer to pay this tax? Psychologists say it has more to do with our all-too-human propensity to run with the dreamlike possibilities it creates in our minds.

“For emotionally significant events, the size of the probability simply doesn’t matter,” said Daniel Kahneman, the Nobel-prize winning psychologist. “What matters is the possibility of winning. People are excited by the image in their mind. The excitement grows with the size of the prize, but it doesn’t diminish with the size of the probability.”

So ticket buyers allow themselves some momentary escapism since it costs only $2, thinking about what they would do with all that money. And they’ll ignore all of the well-known horrors and pitfalls that many lottery winners encounter, whether it’s a severe depression or blowing through all of the money in a form of self-sabotage that ends with them living in a trailer down by the river. This phenomenon of feeling anxious and undeserving, among other things, is what some experts call “sudden wealth syndrome.” It may afflict people who benefit from all sorts of success or windfalls, whether from the sale of a valuable business, signing an N.F.L. contract or inheriting a huge sum from a maiden aunt.

“Money that is much more than you’re used to sounds unlimited,” said Susan Bradley, a financial planner and founder of the Sudden Money Institute, who has worked with several lottery winners. “If you don’t have someone to help you, yes, you can go through extraordinarily large amounts of money, and, even worse, you can be in debt. It can really happen.”

Plugging some numbers into this dream provides some perspective. Winners wanting to be able to safely spend $1 million a year for 55 years (adjusted for inflation) would need about $36 million, after taxes, to invest, according to calculations by Northern Trust. (Those numbers also factor in annual taxes and investment expenses.) They would need to set aside nearly $15 million in high-quality bonds to know they would always have 15 years of spending in stable investments. To cover the remaining 40 years, they would need to put another $21 million in a diversified stock portfolio.

So in thinking about it, it’s not even worth playing unless the jackpot is more than $75 million, because the state and federal government take about half in taxes.

Part of that fantasy is that winners would start buying fast cars and big homes, not to mention stuff for all of your family members along with their children’s education. It’s easy to see how they could run through the money, as hard as that may seem to believe with $36 million in hand. Of course, if you want to live even larger — more homes, more cars, more ex-spouses, servants, accountants, lawyers, other lawyers to watch the lawyers — you’ll need far more. Probably more like $100 million, after taxes.

“If they make it to the fifth year with enough money to securely handle their life going forward and all of their relationships are intact, they are probably going to make it long term,” Ms. Bradley said.

So let’s get back to the probability of all of this ever even happening.

Buying more tickets improves your odds, but not by much. So if you want the fantasy, just buy one. Buying more doesn’t make the fantasy any richer.

It would take centuries of ticket buying before you even make a dent. If you purchased roughly 126,000 tickets a month for the next 80 years, for example, you could improve your odds to 50 percent, explained Gary A. Lorden, emeritus professor of math at California Institute of Technology (who, for the record, has bought a single ticket three times over the last decade; he split the last one with his grandson).

“The difference is like moving from a big house to a small house to make it less likely a meteor will strike your roof,” he said.

Good luck with that.

Your Money: An $18 Million Lesson in Handling Credit Report Errors

That indifference should surprise no one who has ever tried to deal with any of the three big credit reporting agencies, Equifax, TransUnion and Experian. “You feel trapped, like you are in a box,” said Ms. Miller, a 57-year-old nurse who works in a dermatologist’s office. “You have no control over this, and you can’t call them up and say, ‘You’re fired.’ ”

So she tried suing. That worked.

A jury in Federal District Court in Portland, Ore., last week awarded her a whopping $18.4 million in punitive damages, which, according to consumer lawyers, is the largest individual case on record.

If you think this has taught Equifax and the other credit reporting companies a lesson, you are a lot more optimistic than close observers of the industry. They say that despite the huge judgment, little is going to change for the millions of Americans who discover errors in their credit reports.

The credit bureaus are willing to tolerate these errors — and settle with consumers out of court — as a cost of doing business, according to credit experts and lawyers who work on these cases.

“Their business model is to keep doing the same thing over and over again,” said Justin Baxter, the lead lawyer on Ms. Miller’s case. “They can buy off a number of consumers with small dollar amounts and get rid of the vast majority of cases. To Equifax, that’s the cost of doing business.”

Ms. Miller made every effort to fix her report, exactly as consumers are advised to do. She initiated the company’s dispute process about seven times, and in most instances, Equifax would spit back a form letter saying it needed more proof of her identity. So she sent her pay stub and her phone bill. When that didn’t work, she sent her pay stub and her driver’s license. And when that failed, she sent her W-2 form and an insurance bill — at least three times.

But nothing ever changed: Ms. Miller, a model financial citizen who once had the credit score to prove it, had become mixed up with another, much less creditworthy Julie Miller. After she was denied a line of credit from KeyBank, she discovered 38 collection accounts on her credit report, none of which belonged to her, along with an inaccurate Social Security number and birth date. Her financial life was no longer her own.

Mixed files, as they are known in the credit industry, most frequently involve people who share common names with individuals who have similar Social Security numbers, birth dates or addresses. These errors are notorious for being among the most difficult to fix, credit experts said, and require human intervention to untangle the mess. But given the huge number of disputes, the process to address them is largely automated. And that is the excuse the industry advances to consumers who get stuck in its web.

The bureaus often outsource thousands of disputes daily to workers overseas. Those workers, often overwhelmed by the sheer volume of cases, are largely told to translate the problem into a two- or three-digit code that defines the gist of the problem (account not his/hers, for instance) and feed it into a computer.

But that process won’t untangle a mixed credit report. The reason files become mixed to begin with can be traced back to the computer formula the bureaus use to match credit data to a specific person’s credit report. It allows credit data, say a late payment on a credit card, to be inserted into a person’s file even if the identifying information isn’t an exact match. In other words, the system might add a late payment to the credit report of someone like Julie Miller even if the Social Security number is off by two digits or a birth date is off by two years, but enough of the other identifying information matches. That’s roughly what happened to Ms. Miller.

Partial matches aren’t always wrong, of course. Solid estimates on the number of mixed files are hard to find, though a 2004 study from the Federal Trade Commission said that partial matches occurred in about 1 to 2 percent of credit files, citing data from the bureaus. That might not sound like much, but when you consider that there are 200 million individuals with credit files at each of the big three bureaus, that translates to two million to four million consumers.

Kitty Bennett contributed reporting.

Your Money: Aiming to Bring Financial Planning to the Masses

If Alexa von Tobel has her way, however, financial advice will be as widely available — and affordable — as any other mass-produced consumer product or service. Think gym memberships. It will become the perfect wedding gift for your best friend, or for adult children after they have their first baby.

As the founder of LearnVest, an online financial advisory that she started four years ago, Ms. von Tobel, 29, repeats these themes several times over the course of a recent meeting to underscore what she has set out to do: deliver comprehensive and conflict-free financial advice to the middle class.

“Financial advice shouldn’t be a luxury,” said Ms. von Tobel, a petite blonde with a big personality, in the company’s loftlike offices in New York. “We want to disrupt the industry.”

If her plan works, she would be among the first to crack the code, using both technology and bona fide certified financial planners — the gold standard among advisers — to make this sort of help more accessible to millions of Americans. Most individuals do not have terribly complex financial lives, nor should they need to spend several thousands of dollars to get the advice they need.

But for LearnVest to succeed, Ms. von Tobel will need to sell its product — one that, let’s face it, feels a little like eating your vegetables — to a vast number of customers across the country.

LearnVest, which started in 2009 as a budgeting Web site directed at women, just received another large round of financing from big-time investors, which will allow it to hire more planners and support staff as well as open a training and adviser hub in Phoenix. The company raised $16.5 million, which comes on top of the nearly $25 million raised since its inception.

The plan is to beef up its operation so it can handle the big distribution partnerships that are in the works, including a potential deal with American Express, one of its new investors. The company has broad plans to provide its newly designed product: a seven-step, customized financial plan. Ms. von Tobel, who dropped out of Harvard Business School to start the company, also said it was working with employers and financial planning firms to sell its program within 401(k)'s.

Most financial planners focus on wealthier people, whom they can charge $1,000 to $3,000 for a financial plan, or collect 1 percent of their assets, on average, to manage their money. In contrast, LearnVest charges a $399 upfront fee and $19 a month, or $608 annually. You can pay less for help on a specific goal, like paying off debt or starting a budget.

Ms. von Tobel, who is represented by William Morris Endeavor, the talent agency, has worked hard to raise the company’s profile — as well as her own — in the world of personal finance, though she has not yet reached Suze Orman status. A book by Ms. von Tobel will be released in December.

At the moment, her company does not have much direct competition, aside from the smattering of unbiased advisers that charge a flat or hourly fee. Several relatively affordable online financial firms have cropped up in recent years — including Betterment, Wealthfront, Flat Fee Portfolios and FutureAdvisor — but their focus is much narrower. These companies help assemble and manage low-cost investment portfolios. But they won’t determine how much you can afford to spend on a mortgage, what sort of life insurance you should buy and whether you should be saving more for a child’s college tuition or your own retirement.

Personal Capital, an online wealth management firm, also combines real advisers with technology, but it, too, focuses on money management and requires a minimum investment of $100,000. NestWise, a unit of LPL Financial, opened last September and probably comes closest to competing directly with LearnVest. It has 23 advisers who use technology to connect with its clients, but not all are certified financial planners. Its most expensive service costs about $825 for the first year and $575 annually thereafter, though it will manage your money for about 1 percent of your assets, in addition to the cost of the underlying investments.

So what do you get at LearnVest for $19 a month? Since the company became a registered investment adviser last year, it can now offer investment advice. Ms. von Tobel says she is ripping a page from Weight Watchers’ playbook with the most recent version of its service: a seven-step action plan, which begins with a diagnostic call that typically lasts 45 to 90 minutes. “You can be someone who is extremely sophisticated with millions of dollars or a doctor with $200,000 in debt,” said Ms. von Tobel, who became a financial adviser earlier this year. “But you should still go through this process.”

(So far, most customers are college-educated people between 25 and 55 with incomes of $70,000 or more.)

The advisers save time by leaning heavily on the company’s technology: a planner could see where you overspent on dinner the night before by viewing your online profile.

Your Money: Rules for Reverse Mortgages May Become More Restrictive

Right now, practically anyone who is breathing can qualify for a reverse mortgage — no underwriting or credit scores necessary. But that might be about to change.

Most reverse mortgages, which allow homeowners 62 and older to tap their home equity, are made through the Department of Housing and Urban Development, whose Federal Housing Administration arm insures the loans. But declining home prices after the housing crisis took a big toll on the federal program. So did the popularity of one type of mortgage, which allowed homeowners to withdraw the maximum amount of money available in a big lump sum.

The F.H.A. eliminated that type of loan this year. And over the last few years, in an effort to strengthen the program, the agency raised its fees and reduced the amounts people could borrow.

But now, the F.H.A. says it will need to take even bigger steps by the beginning of its new fiscal year in October.

Because of the turmoil in the housing market and because many borrowers in the program didn’t have enough money to pay their property taxes and homeowners insurance over the long term, the F.H.A. wants to require borrowers to undergo a financial assessment. It may also factor in borrowers’ credit scores, something it has not done in the past.

Before the agency can do either, it needs Congressional approval. The House gave its assent last month, but it’s unclear whether the Senate will follow suit.

If the F.H.A. fails to get Congress’s blessing, it will have to take more draconian actions in the coming months, according to F.H.A. officials who did not want to be named because they were still working with Congress on the issue. That means that effective Oct. 1, yet another of its reverse mortgage products will probably be eliminated, leaving borrowers with options that would allow them to get access to 10 to 15 percent less cash than they can now.

“Instead of using a scalpel, they will have to use a hatchet,” said Christopher J. Mayer, professor of real estate, finance and economics at Columbia Business School, who is also a partner in a start-up company, Longbridge Financial, that provides reverse mortgages.

Borrowers who are now contemplating what is called a HECM (pronounced HECK-um) Standard (for home equity conversion mortgage) reverse mortgage should know that it could disappear in the fall. (Of course, that doesn’t mean borrowers should rush out and get one. We will probably know the fate of the loan sometime next month.)

With all reverse mortgages, the amount of cash you can obtain largely depends on the age of the youngest borrower, the home value and the prevailing interest rate. The older you are, the higher your home’s value and the lower the interest rate, the more money you can withdraw. You don’t have to make payments, but the interest is tacked onto the balance of the loan, which grows over time. When borrowers are ready to sell (or when they die), the bank takes its share of the proceeds from the sale, and borrowers or their heirs receive whatever is left, if anything.

Right now, using a “standard” reverse mortgage, a 65-year-old borrower with a home worth $400,000 could tap about $226,800 in cash or a line of credit after various fees, according to calculations by ReverseVision Inc., a reverse mortgage software company.

Borrowers can receive the money in several other ways, too, including payments over the life of the loan or in installments in higher amounts over a specific term.

If the F.H.A. were to eliminate the standard mortgage, the same borrower could instead use the “saver” reverse mortgage, which has lower fees but permits you to withdraw less: this homeowner could withdraw about $194,800, or 14 percent less than the “standard,” in cash or a line of credit, after all fees. (Another “saver” option would also be available; see the chart accompanying this article for more specifics).

F.H.A. officials told me that they would prefer to keep all of the agency’s mortgage offerings and instead put rules into place that would help ensure that they accept only borrowers who can actually afford to pay their property taxes and homeowners insurance, which is required to avoid foreclosure. Nearly 10 percent of reverse mortgage borrowers are in default because they failed to make those payments.

Your Money: Taking a Cue From Bernanke a Little Too Far

You can hardly blame them. Investors have been fleeing bonds in droves; a record $76.5 billion poured out of bond funds and exchange-traded funds during the month of June through Wednesday. That exceeds the previous record, according to TrimTabs, when $41.8 billion streamed out of the funds in October 2008 and the financial crisis was in full force.

But the rush for the exits really means one thing: investors are betting that interest rates are about to begin their upward trajectory, something that’s been expected for several years now.

Their cue came from the Federal Reserve chairman, Ben Bernanke, who recently suggested that the economic recovery might allow the central bank to ease its efforts to stimulate the economy. That includes scaling back its bond-buying program beginning later this year.

So the big fear is that interest rates are poised to rise much further, driving down bond prices; the two move in opposite directions.

A Barclays index tracking a broad swath of investment-grade bonds lost 3.77 percent from the beginning of May through Thursday, according to Morningstar. United States government notes with maturities of 10 years or longer, however, lost an average of 10.8 percent over the same period.

Making a bet on interest rates is no different from trying to predict the next big drop in stocks, or jumping into the market when it appears to be poised to surge higher. These sort of emotional moves are exactly why research shows that investors’ returns tend to trail the broader market.

And it’s also why many financial advisers suggest ignoring the noise, as long as you have a smart assortment of bond funds that will provide stability when stocks inevitably tumble once again.

“It’s a futile game to base portfolio moves on interest rate guesses,” said Milo Benningfield, a financial adviser in San Francisco. “We don’t have to look any further than highly regarded Pimco manager Bill Gross, whose horrible interest rate bet against Treasuries in 2011 landed him in the bottom 15 percent of fund managers in his category that year. Investors should take a strategic approach designed around the reason they hold bonds — and then sit tight whenever hedge funds and other institutions shake the ground around them.”

The main reason longer-term investors hold bonds, of course, is to provide a steadying force. And though today’s lower yields provide less of a cushion — the 10-year Treasury is yielding about 2.5 percent — bonds still remain the best, if imperfect, foil to stocks.

“The role of bonds in a portfolio has always been to be a ballast or a diversifier to equity risk,” said Francis Kinniry, a principal in the Vanguard Investment Strategy Group. “And that is very true today. Yields are low, but this is what a bear market in bonds looks like.”

So, yes, losses are indeed more probable than they have been in recent years. From 1976 through Jan. 31, 2013, high-quality bonds yielded an average of 7.3 percent, according to a recent Vanguard , which provided a nice cushion. For instance, if you had a portfolio of 60 percent stocks and 40 percent bonds — and stocks fell by 20 percent — the overall portfolio would have lost 9.1 percent. If the market plummeted 40 percent, the entire pile of money would be worth 21 percent less.

The situation is a bit different now. Assuming a more conservative average return on bonds of 1.9 percent — a reasonable estimate based on bond yields now, according to Vanguard — the same 20 percent drop in the stock market would cause the overall portfolio to decline by about two percentage points more, or 11.2 percent. If the market plummeted by 40 percent, the portfolio would lose 23 percent.

“Investors have been conditioned by higher bond yields going into both bear markets in the last decade to believe that bonds will substantially offset stock declines,” Mr. Benningfield added.

So perhaps the loss from the bonds somehow feels worse because it’s not something investors are accustomed to. And the memories of the stock market collapse of 2008-9 are still fresh enough.

“People are using adjectives like ‘blood bath’ and ‘devastation,’ but we are talking about a negative 3 percent return,” said Mr. Kinniry, referring to the Vanguard Total Bond Market Index fund, which is down by that amount year-to-date.

Even the big bond market sell-off in 1994, which many refer to as a “massacre,” doesn’t seem quite as violent as that moniker suggests. As Mr. Kinniry points out, the same index fund lost 5.3 percent that year, after interest rates spiked by 2.83 percent. If the same sort of situation were to play out now, he said the returns would be significantly worse because bond yields are lower than they were back then. “You might lose about 8 percent,” he said, adding that losses could be deeper depending on how quickly rates rose, among other factors. But typically, “we’re talking about single-digit losses.”

Still, some advisers suggested taking a closer look at your overall allocation to stocks, particularly if you’re not well diversified, since bonds will provide less protection.

For most investors, holding bonds through low-cost index funds remains the most prudent course. People who invest in individual bonds don’t have to worry about fluctuations in their price because they can continue to hold the bond and collect their interest payments until maturity, at which point they’ll collect its face value (unless, of course, the bond issuer defaults). But you need to have a good pile of cash — some experts say $500,000, even more — to assemble a diversified portfolio of municipal and corporate bonds (though you don’t need quite as much for Treasuries, since they’re backed by the government).

You can figure out how sensitive your fund is to interest rates by looking at its duration, which essentially measures how long it will take to receive all of your money back, on average, from interest and your original investment. Generally speaking, for every percentage point that interest rates rise (or fall), a bond’s value will decline (or increase) by its duration, which is stated in years. Bond funds with shorter durations are less susceptible to interest rate risk — the faster a bond matures, the thinking goes, the more quickly you can reinvest the money at a higher interest rate.

That means a fund like the Vanguard Total Bond Market Index fund, which has a duration of 5.5 years, would decline by about 5.5 percent. But since the fund also pays investors income — it has a yield of about 1.7 percent — it would actually only post a total loss of about 3.8 percent. (Future returns would be one percentage point higher, too, thanks to the rise in rates).

But if even that feels too risky, experts say you can put some of your bond money into a diversified index fund with an even shorter duration. The trade-off, of course, is that you will earn less income. That might not matter once you remind yourself why you own bonds at all.

Your Money: Limiting the 401(k) Finder’s Fee

It is an employer’s legal duty, after all, to look after their employees’ interest in overseeing the accounts.

A series of lawsuits making their way through the courts have raised questions about whether employees are being overcharged for the accounts.

Experts say the suits and new federal rules have helped bring the fees down to a more reasonable level, and have prompted at least some employers to adopt less murky fee arrangements that more clearly separate what they are paying for investments and what it costs to administer the plan. But the fees workers pay can still vary widely and be hard to discern.

One recent lawsuit was brought on behalf of employees at Cigna by Jerome J. Schlichter, a lawyer whose success in similar cases has caused some anxiety among human resources executives. His firm, Schlichter Bogard & Denton, has brought 14 similar lawsuits over the last seven years on behalf of 401(k) plan participants. Typically, the suits claim that the employees were paying too much in fees. Several employee benefit experts have said that Mr. Schlichter’s cases and others have resulted in lower charges as other employers began to fear attracting lawsuits of their own.

“It’s unfortunate that it took litigation to focus attention on costs,” said Fred Reish, a lawyer with Drinker, Biddle & Reath in Los Angeles and an expert on the federal law that governs 401(k) plans. “But it clearly has.”

More recently, another force has been putting pressure on 401(k) fees, which typically include investment and administrative expenses. Last summer, the Labor Department started to require the companies that provide 401(k) plans to disclose more details on fees. Given the complex way these companies price their wares, the new rules are making it easier for employers to comparison-shop. (A separate rule required employers to provide more fee disclosures to employees.)

Benefit experts agree that because of the combination of forces, the cost of running and investing in the plans, on average, have been on the decline for several years.

According to BrightScope, a financial research company that tracks 401(k) plans, the total costs, including fees and administrative expenses, were 0.8 percent of assets in 2011. That’s down from 0.85 percent in 2009.

Still, workers can pay a fairly wide range of fees. Many plans cost between 0.2 and 1.8 percent, but some plans, particularly smaller ones, are more costly.

Fees can make a significant difference. According to the Labor Department, paying just 1 percentage point more in expenses over the course of 35 years could reduce a worker’s retirement savings by nearly 28 percent. Consider a worker with a 401(k) balance of $25,000 who earns 7 percent over the next 35 years. If this person paid 0.5 percent in fees, even if she stopped making new contributions, her account would grow to $227,000 at retirement. But if she paid fees totaling 1.5 percent, her savings would rise to only $163,000, or 28 percent less.

That kind of swing has been at the heart of most of the lawsuits brought by participants.

In Mr. Schlichter’s most recent case, a group of 401(k) participants say that Cigna, the employer, charged them excessive fees (Cigna was using proprietary investments for its own employees; that’s legal, but the fees need to be reasonable). On top of that, the workers say that the employer breached its fiduciary duty — in other words, failed to act in the employees’ best interests — when it sold its retirement division to Prudential in 2004.

Instead of shopping around to be sure the workers would get the best rates, their lawsuit says, Cigna lumped the plan with the rest of the assets it sold, and promised Prudential it could continue to manage their money for at least three years, according to court documents.

Cigna and Prudential dispute the lawsuit’s claims, according to a news release issued by Mr. Schlichter’s firm, which is based in St. Louis, and they said the plan had always been appropriately managed. The proposed $35 million settlement, filed in United States District Court for the Central District of Illinois, requires the approval of an independent financial expert and a judge, he said. The settlement would cover all people in the plan — which had more than $2.8 billion in assets as of 2011, with more than 42,000 participants — from April 1999 through May 31, 2013.

Wealth Matters: For a Fee, Seeking Owners of Unclaimed Money

His father had kept meticulous records, Mr. Sinclair said, and little had changed since his death several years earlier. Mr. Sinclair and his two siblings were also skeptical of the fee the company, Legal Claimant Services, a division of Keane, was seeking: 36 percent of the account’s value.

But this spring, Mr. Sinclair said, Keane told them the unclaimed money was $148,400 in stock. He and other family members decided they needed to account for everything so they could finally close their mother’s estate. At $1.5 million, it was small by federal standards but large enough to owe Ohio estate taxes. So on May 24, Mr. Sinclair, as the executor, signed a contract with Keane to get details on the unknown account for a 25 percent fee.

“Within a matter of days, I got a letter from them detailing what they had found, right down to the numbers on the stock certificates,” he said. “My stomach fell out of my body. I e-mailed them back and said, ‘This is stock we’ve always been aware of, and you didn’t find it.’ ”

The stock, for First Bancorporation of Ohio, which is now part of FirstMerit Bank, was in his mother’s safe deposit box, where it had been for years, he said. Nonetheless, Keane still expected its $37,100 fee.

Stephen Lochner, a representative for Keane, wrote in e-mails shown to The New York Times that the company had based its claim on the fact that $11,400 in dividend checks on the stock had never been cashed. “Please realize that knowledge of the asset or possession of shares doesn’t take away the fact the account is dormant, needs attention and subject to abandoned property laws of the state,” Mr. Lochner wrote.

“If you wish to retain the account, I can provide an updated set of documents for you to complete,” he added. “The revised documents will give you the option to retain most of this account and we can update the address and registration.”

When Mr. Sinclair balked at a fee being charged on the whole account — and not the dividend check, which he admits he did not know about — Mr. Lochner suggested Keane’s general counsel talk to Mr. Sinclair’s lawyer. The company contends the contract is clear about the basis for the fee. The two sides have been locked in a legal dispute, which only this week seemed headed toward a resolution.

It may strain credulity that a company could charge a fee for saying it found something in a person’s safe deposit box. But the amount of unclaimed property in the United States is rising and so, too, is the pressure on companies to find owners of dormant accounts. This has given rise to locator companies that look for account owners and often charge them a fee for informing them about an account.

The National Association of Unclaimed Property Administrators, the membership organization of state unclaimed property offices, estimated that $41.7 billion is sitting in state coffers, where it goes if it has been unclaimed after a period of years. But the amount of unclaimed property that has not reached that point is certainly higher. (In 2011, only $2.25 billion in 2.5 million claims went back to people.)

Common types of unclaimed money include paychecks, utility deposits and life insurance policies as well as bank, 401(k) and brokerage accounts.

Kristina Koutrakos, a managing director at Manchester Capital, which manages money for people with $10 million to $400 million in assets, said that when new clients came to the firm, 30 percent of the time, they had forgotten about some asset. A separate 30 percent of the time — albeit with some overlap — her company finds property that clients never knew they had.

“We’ve found all kinds of stuff, from a $15 stock certificate to 25 acres of land in North Carolina,” she said. “People lose 401(k)’s if they’ve moved around a lot. They forget about stock options or old country club investments.”

Manchester does not charge its clients an additional fee for the search, only a fee to manage money.

Self-Finance or Raise Money? A Quandary for Start-Ups

But while Mr. Stanek and Mr. Moore went after roughly the same market at roughly the same time, they differed in one critical aspect: how they financed their dreams. One quickly raised more than $50 million, while the other mostly self-financed, thus creating a rare opportunity to assess the difference venture capital can make and bring new perspective to an age-old debate.

When Mr. Stanek, a Czech entrepreneur, founded GoodData in San Francisco in 2007, he already had plenty of experience with venture capital. He had sold a venture-backed software development tools company, NetBeans, to Sun Microsystems in 1999 for a little more than $10 million. And in 2006, he sold Systinet, a Web-service company, to Mercury Interactive for $105 million.

After financing the first year of GoodData’s software development with several hundred thousand dollars from his Systinet sale, Mr. Stanek began to seek investors. Eventually, he brought in $53.5 million from the likes of O’Reilly AlphaTech Ventures and Andreessen Horowitz. “We spent three years building a product and we are still building big pieces. That was funded by the V.C.’s and myself,” said Mr. Stanek, 47. “It’s like the printing business. I have to spend money on my printing machine. There’s an initial large investment, and then once you have the printing press running, it’s very predictable. So if we wanted to create a dominant large company, we didn’t have a choice.”

By contrast, before starting RJMetrics, the co-founders, Robert Moore and Jake Stein, worked as junior analysts at a New York venture capital firm, Insight Venture Partners, where they came across entrepreneurs who had built profitable businesses without a lot of capital and put off fund-raising as long as possible. “What happens in those situations is those entrepreneurs do extremely well personally,” said Mr. Moore, 29.

When they started RJMetrics in late 2008, Mr. Moore and Mr. Stein invested $10,000 of their own money. Mr. Moore wrote the first version of the company’s software in his attic in Collingswood, N.J. They did not hire their first employee until 2010, and they moved to an office in Philadelphia, where costs are far less than in New York or San Francisco.

By the time they did raise some money, in early 2012, they had 100 customers and annual revenue of about $1 million. “That put us in excellent negotiating position, because we had a proof point that other companies at our stage didn’t have,” Mr. Moore said. The owners raised $1.2 million, almost all from RJMetrics customers.

The two approaches have created very different companies. RJMetrics signed its first paying customer to a rudimentary prototype just three months after it started. To build revenue, it had to hope for good word of mouth (which it got) because it did not have a sales staff. But bootstrapping, or self-financing, did allow the founders to keep a large percentage of the company’s equity and to avoid the distortion that can come from having money and the demanding investors who supply it.

The venture capital industry views bootstrapping in the face of a big market opportunity as false economy. John O’Farrell, a partner at Andreessen Horowitz, said that it generally took an investment of $75 million to take a software company from start-up to initial public offering. “If you want to capture a big open market, you want to bring in money to grab land,” he said. “If you bootstrap, the tendency is to try to get profitable early so you don’t need to put in more money, but you end up missing a big opportunity.”

GoodData’s war chest allowed Mr. Stanek to staff up for the land grab. The company now has about 250 employees, half dedicated to the product and half charged with sales and marketing. RJMetrics, on the other hand, has 26 employees, more than half of them working in product development and only four on sales and marketing. The company’s first director of marketing started in February.

Inevitably, the companies have gravitated toward different markets. While RJMetrics has gone after small and midsize companies, GoodData has pursued Fortune 2000 clients that demand robust products and have the money to pay for them. RJMetrics had about $1 million in revenue in 2011 and about $2 million in 2012, according to Mr. Moore. Mr. Stanek declined to specify his company’s revenue, but he noted that last year GoodData signed 42 contracts that were each worth more than $100,000 a year, which would suggest an annual run rate of at least $4 million.

Your Money: The Unspoken Stigma of Workplace Flexibility

“Many times these policies are on the books, but informally everyone knows you are penalized for using them,” said Joan C. Williams, founding director of the Center for Work-Life Law at the University of California, Hastings College of the Law, referring to the array of flexible work arrangements some employers offer. “I invented the term ‘flexibility stigma’ to describe that phenomenon. Recent studies have found that it is alive and well, and it functions quite differently for women than it does for men.”

For some women, it gives employers a reason to view them through the lens of motherhood, prompting the strongest form of gender discrimination. Mothers are seen as less competent and less committed to their work, she said, citing other studies. But more surprising is that men who seek work flexibility may be penalized more severely than women, because they’re viewed as more feminine, deviating from their traditional role of fully committed breadwinners.

That may at least in part explain why using flexible work options — which include telecommuting, compressed work weeks and sharing jobs among employees, to name a few — has been slow to catch on, even though more organizations are offering them (at least on paper). Employers have increased options to help workers manage the time and place they work, from 2005 to 2012, according to the Families and Work Institute’s 2012 National Study of Employers. But employers have cut back on alternatives that would enable employees to spend significant amounts of time away from full-time work, like career breaks or moving from part time to full time and back again.

A group of researchers recently examined the stigma of workplace flexibility from all angles in a series of studies published on Friday in The Journal of Social Issues, co-edited by Professor Williams and others. Among other things, the researchers examined the effect of men taking leave after the birth of a child (they were more likely to be penalized and less likely to get promoted or receive raises), as well as the reasons some professional women decide to leave work after having children (working reduced hours resulted in less meaningful work assignments). They also looked at how the perception of women using flexible arrangements differs across class lines: affluent women often receive the message that they should stay at home, while poor women are more likely to hear that they shouldn’t have had children to begin with.

“These studies show that deep-rooted cultural values intertwining work devotion and gender identity drive the flexibility stigma,” said Professor Williams said.

But it is clear that many American families crave flexibility, especially as traditional gender roles of mothers and fathers continue to blur. A study by the Society for Human Resource Management conducted in 2008, the most recent data available, found that 34 percent of human resources professionals polled indicated an increase in requests for these arrangements compared to the previous year.

The reasons are fairly obvious, as more Americans chase the elusive work-life balance. Nearly equal shares of working mothers and fathers report that they feel stressed about juggling work and family life, a recent Pew Research Center analysis found. But while working fathers placed more importance on having a high-paying job, the study found working mothers were more concerned with having a flexible schedule.

In fact, it’s possible that more women would be working if they had such arrangements available to them, and that they felt comfortable using. The share of working-age American women in the work force has been on the decline relative to other developed countries, a phenomenon tied at least in part to those countries’ rapid expansion of family-friendly policies, according to a study by Francine Blau and Lawrence Kahn, both professors of economics at Cornell, published in February.

In 1990, the United States had the sixth-highest share of women in the work force among 22 developed countries, with 74 percent of women ages 25 to 54 working. But by 2010, the share of American women working dropped to 17th place, with slightly more than 75 percent of women working compared to 80 percent outside the country, the research found. They estimate that American women’s participation would have been 82 percent if they had access to the other countries’ policies, which include a right to part-time work. “Maybe we have reached a maximum and we can’t go any higher,” Professor Blau said, referring to the percentage of working women. “But this suggests we could go higher if we worked on these work-life balance issues.”

Flexibility does potentially present a double-edged sword, at least as far as women’s advancement goes. Long, paid parental leaves and the availability of part-time positions may encourage women who would have otherwise been more committed to working to take those part-time or lower-level jobs, Professor Blau explained. And employers, in turn, may be less likely to promote or put women in higher positions if they think they are going to take advantage of flexible arrangements. As it stands now, women in the United States are more likely to work full time than in other developed countries and they are more likely to be in higher-level positions.

“If you have a very extensive network of these family-friendly programs, it can encourage women to take a more traditional role,” Professor Blau said. “It’s an issue of balance. If you don’t have adequate arrangements, then it’s very hard for women to maintain their attachment to the labor force and for employers to invest in the women’s skills.”

But it’s also an issue of perspective. For women to be able to take advantage of these arrangements without judgment, men need to use them freely, too. But that requires viewing men not solely as breadwinners, but as individuals who also have the same choices as women.

“Not only have we put women on the mommy track, we put dad on the daddy track,” said Kenneth Matos, an organizational psychologist and senior director of employment research and practice at the Families and Work Institute, a research group. “We tend to talk about what happens to women, but we don’t talk about what happens to men and we wonder why women are stuck.”

After all, as Professor Williams explained, pressures on men haven’t changed. “Feminism is all about choices — well, choices for whom?” she asked. “Even feminism is putting pressure on men to live up to the ideal of work devotion. So long as that is the state of play, nothing is changing for men. And if nothing is changing for men, nothing is changing for women.”

Both inside many companies and at the national level, workers largely have been left to sort these issues out on their own. But some places are beginning to take cues from other countries that have already carried out national policies to protect workers who want more flexible arrangements. Last month, Vermont passed an “equal pay” law that, among other things, provides employees with the right to request flexible working arrangements and protects them from retaliation for asking. The law requires employers to listen to workers’ pleas twice a year, though they aren’t obliged to grant any requests. “This law is modeled after similar laws in the U.K. and Australia,” said Cary Brown, executive director of the Vermont Commission on Women, “and we believe it’s the first of its kind in the United States.”

Still, most workers still remain at the mercy of their managers. “It is not systematic and it is not reliable and for a lot of people, it depends on whether your supervisors are sympathetic,” said Ariane Hegewisch, a study director at the Institute for Women’s Policy Research. “But you have no guarantees.”

Your Money: Fine Print and Red Tape in Long-Term Care Policies

But some family members are shouldering another type of burden: one that involves piles of paperwork and repeated phone calls, as they are forced to navigate a labyrinth of requirements to collect benefits that the insured spent many years paying.

“There is no possible way an elderly person who is ill and needs help can possibly do this work,” said Fiona Havlish, who coordinated her father’s home care in Pottstown, Pa., before he died last year, a week after his 90th birthday. “It took six to eight weeks to get the insurance into place, and this was working on it every single day. It was an incredible amount of work.”

Ms. Havlish, a former nurse who now works as a life coach in Boulder, Colo., said she first had to find a home care agency that was not only covered by the long-term care policy but one that she felt comfortable entrusting with her father’s care. Later, she had to follow up continually with the aides and doctors to make sure they were filing the proper paperwork so that they insurer would pay. “Three months after he was gone,” she added, “I was still fighting with them over paper.”

At least the bill for her father’s care was eventually paid. In other cases, families have had to fight to overturn denials, and have gone as far as hiring lawyers to file suit. Many Americans now in their 80s and 90s who are collecting benefits — or trying to — bought their policies decades ago when the policies were more restrictive than now. On top of that, many insurers have since left the business after mispricing the policies and failing to judge the economics of the industry, which has made collecting payments even more difficult.

“Everything is not rosy,” said Jesse Slome, director of the American Association for Long Term Care Insurance. “When insurers stop selling or exit the business, many of them hire these third-party administrators to adjudicate claims and that is where interpretations don’t seem to be as liberal.”

Insurance agents who have specialized in long-term care policies for a couple of decades, however, told me that most of the top-rated insurers pay claims without issue. And clearly, claims worth billions are paid each year: An estimated 264,000 people received long-term care benefits at the end of 2012, according to Mr. Slome, and $6.6 billion in benefits were paid that same year.

Still, “the process can be pretty daunting for people,” said Bonnie Burns, a policy specialist at California Health Advocates, an education and advocacy group.

If you need to file a claim on behalf of a loved one, it helps to know why claims are denied and where filers tend to get tripped up. Here’s what I gathered, from longtime brokers, consumer advocates and lawyers who do battle with insurers on these issues:

DEDUCTIBLES In the long-term care world, deductibles work a bit differently than typical insurance policies. The policies have waiting periods, or elimination periods, and they are typically measured in days: 30, 60, 90 or 100 days. So if your policy covers $150 a day for in-home care, and you have a 60-day waiting period, you will typically owe the first $9,000 — 60 times $150 a day — before the policy kicks in.

But the way the waiting periods are counted is critical, too. “If a person is getting home care a few days a week, and the company only counts those days of care toward the waiting period, the total time needed to satisfy the waiting period will be much longer than 60 days,” Ms. Burns said. “So it isn’t just the $9,000, but the total time that has to be satisfied.”

With certain older policies, meanwhile, the insured person must also spend three days in the hospital before the policy will pay any benefits. “Some of these older policies have requirements that most states don’t allow today,” Ms. Burns said. “But these requirements must still be met in these older policies.”

ELIGIBILITY To become eligible for benefits, patients must be expected to need “substantial assistance” for at least 90 days, either because they are suffering from a form of dementia, for instance, or because they can’t perform two basic daily activities from a list of six, including items like bathing, getting dressed and eating. (This applies to certain policies written after 1997.)

“What we are finding today is that when people are getting assessed, they fire on 8 or 10 cylinders on some days and they will trick people,” said Brian I. Gordon, president of MAGA, a long-term care insurance agency in Riverwoods, Ill. “They want to become Superman the day the assessor comes out. And then the insurer may deny the claims.”

Glenn R. Kantor, a lawyer in California whose firm focuses on insurance claims, said he represented a woman, blind from severe macular degeneration who was receiving benefits for home care. But when the representative from the insurer asked her if she could bathe by herself, the woman told the company she could as long as her aide led her into the shower and gave her soap and a washcloth. Shortly thereafter, the insurer cut off her payments.

Then, “they sent her to collections to get the money back,” Mr. Kantor said, because the caregiver was not within arm’s length but left the bathroom to go into the next room while the woman bathed. The insurance company settled, but the terms were confidential so Mr. Kantor could not divulge the insurer or the exact amount it paid.