The Year in Review

published 31 December 2009

What a year this has been. The questions I’ve received have gone through an interesting evolution since last January, focusing on pretty much every area of personal finance.

A year ago, readers were extremely concerned about their finances and the future of financial institutions. They were still reeling after the Lehman Brothers and AIG shake-ups in September 2008, and they wondered whether they could count on any financial institutions. Would their insurers, annuity companies and banks go out of business and take their money with them?

After the Bernie Madoff story started to unfold, readers also had a lot of questions about whether they could trust their brokers and advisers. Scam artists came out in full force to try to take advantage of the economic downturn, and readers asked about many suspicious come-ons they received at the beginning of the year. I wrote several columns warning about scams, as well as ones explaining how to research an adviser, when to dump a bad one, and how to make sure your money is protected.

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Retirees were relieved to discover that they wouldn’t need to take required minimum distributions from their shrunken accounts in 2009, and people who lost their jobs wanted to know how to make the most of the 65% COBRA subsidy for health insurance that was included in the February economic-stimulus bill. Readers also asked about the stimulus’s first-time home-buyer tax credit, the tax break for new car purchases and the expanded tax credit for college expenses, as well as who would get extra money in their paychecks and what retirees needed to do to get their benefit checks. Instead of foundering, people started focusing on how to make the most of these new rules and the new reality.

Then the market started to turn around, and the questions gradually shifted from concerns about financial safety and long-term savings to a renewed focus on current expenses. A lot of people asked about health-care reform and health insurance, especially as job losses continued during the summer. Readers wanted to know how to make the most of new credit-card laws -- some took effect in August, and the rest will take effect in February -- and how to deal with changes to rates and rules that their card companies were making in anticipation of the new laws. Members of the military were excited to learn all they could about the new, expanded GI bill. And readers asked a lot of questions about taking advantage of the “cash for clunkers” program and other auto-buying incentives in late summer.

In the fall, routine financial decisions took on a greater sense of urgency. People paid particularly close attention to their open-enrollment choices for health insurance and Medicare prescription-drug coverage as health-care costs continued to rise while paychecks and Social Security benefits did not increase. Readers were looking for ways to stretch their limited incomes as far as possible. And as some of the stimulus benefits started to expire near the end of the year, many readers scrambled to take advantage of them -- and were relieved to discover that the first-time home-buyer credit was extended and expanded to include some buyers who already own a home. The COBRA subsidy was extended as well.

Now many readers ask about issues that they focused on before the meltdown: how to take advantage of tax laws and other strategies that can save them money, protect their assets and lead to future benefits. I continue to receive a ton of questions about pretty much every nuance related to the 2010 Roth IRA rollover rules, and I think that's a good sign. The panic seems to be over. Even though people continue to lose jobs and deal with lower incomes, they're once again asking how to make the most of the system -- not whether the system is going to disappear entirely. Many people can finally look beyond their current struggles to the future.

Here are a few of my favorite columns from 2009 that are still timely as we look ahead to 2010. As always, thank you for sending me your questions throughout the year. I’ve learned so much from all of you, and I hope that the information we’ve provided on Kiplinger.com has helped some of you make it through a very difficult year. Please continue to e-mail me at askkim@kiplinger.com with your questions and comments in 2010.

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Ask Kim

As the "Ask Kim" columnist for Kiplinger's Personal Finance, Lankford receives hundreds of personal finance questions from readers every month. She is the author of Rescue Your Financial Life (McGraw-Hill, 2003), The Insurance Maze: How You Can Save Money on Insurance -- and Still Get the Coverage You Need (Kaplan, 2006), Kiplinger's Ask Kim for Money Smart Solutions (Kaplan, 2007) and The Kiplinger/BBB Personal Finance Guide for Military Families. She is frequently featured as a financial expert on television and radio, including NBC's Today Show, CNN, CNBC and National Public Radio.