Personal finance: Keep holiday spending under control this season

Posted by: Andrew Pia

Written by: Kathy DiCenso

As the year comes to a close, spending in most households heads up -- on holiday gifts, entertainment and, depending on where you live, on already high energy costs.

It's easy to lose control. So make a plan now to minimize debt while putting money where it absolutely needs to go.

Put your current finances under a microscope

Call it a gift from you to you. If you're trying to get your finances in order, plan a visit now with a financial adviser, such as a certified financial planner professional. This meeting should extend beyond your holiday spending to setting goals for saving, investing and extinguishing debt and setting financial goals for the future. You also can examine your spending patterns and the emotional drivers behind many of our financial decisions.

Create a holiday budget

If you have credit card debt now, you don't want to elevate those numbers. Set a spending number you will not exceed and start setting aside cash in an account to cover it. When should you make the budget? As early in the year as possible, but if you haven't started shopping yet, figure out how much money you can realistically set aside and stay as close to that number as you can.

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Money Monday: The Best Personal Finance Stories from the Weekend

Posted by Ka Lee Angel Lee

Here is a run down of the personal finance stories you might have missed this weekend:

In Forbes, we wrote about why long-term investors might want to think twice before investing in gold (whether the metal itself or stocks from gold mining companies), how to push for a better retirement plan at work and how to avoid costly mistakes in your Individual Retirement Account.

The New York Times, meanwhile, discussed how investors are in better shape with the Dow at 10,000 now than they were with the Dow was at 10,000 in 1999.

Los Angeles Times columnist Kathy M. Kristof (a sometimes Forbes contributor) listed steps to take before the end of the year to lower your tax bill.

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Choosing the right card

By Alma Zhumagulova

There are many payment options available nowadays: cash, checks, credit and debit cards and other types of cards. Soon after their invention, credit cards became widely popular in American society – one of the top payment methods. However, after the financial crises hit the wallets of consumers, the statistics have shown that now credit cards are out and debit cards are in.
While it might seem that debit cards are very safe and convenient, there are several cons to this payment option too. On the plus side, debit cards are very easy to obtain and are equivalents of cash, i.e. they let you pay for your purchases with your own money while not having to carry vast amounts of cash. However, if your debit card information is stolen, then you have much more responsibility for unauthorized payments than with the credit card. So paying with a debit card for online transactions is not the best idea. Another drawback is that debit cards don’t help you improve your credit score while they might “help” you worsen it: overdraft and other debit card fees are reported to credit bureaus and you cannot dispute them once they are incurred. Before choosing one or another method of payment you should consider all the pros and cons of each and also the purposes that you use them for as well as your long term goals.

Sources:
http://money.cnn.com/2009/11/02/pf/debit_card_pitfalls/index.htm
http://www.mortgageloan.com/credit-versus-debit-cards-know-the-differences-2845
http://www.sayeducate.com/2009/05/13/debit-card-usage-increases-credit-card-usage-decreases/

Parking Payout

Posted by Shawn Gao

When I came back from NYC, I drove with two parking violation tickets in car, which is 100 dollar each. Without knowing any parking policy, I was fined in front of parking signs, which said “No Parking Without Commercial Vehicle”, but before I parked in that place with asking one police in that area. I cannot see why the parking violation fee in NYC is so expensive by comparing with violation fee in Syracuse, which is 35 dollar each.
People in cities also claim what they happened when they got the violation tickets. For example, Mr. Robert who did not find out a violation ticket which was find 5 years ago, and received a letter from city collection agent for his added- up penalty $1,012. Only choice that he had is either write a check to payout or hire a lawyer. As that second option would have cost at least twice as much, he really had no choice at all.
What can people do? City councilman Bernard argue if collection agent could limit fines to no more than five times the original penalty. However, other officials are considering whether limiting fines would decrease the parking revenue or not.
I would hope the city will still choose to do the right thing.
1. http://www.baltimoresun.com/news/opinion/editorial/bal-ed.parking15nov15,0,1543290.story
2.http://weblogs.baltimoresun.com/news/opinion/2009/11/upcoming_editorial_baltimores.html
3.http://greatergreaterwashington.org/post.cgi?id=4065

Tips for making college more affordable

Posted by Lindsey Connell

(CBS) For many parents, saving for college is a daunting task. Stephanie AuWerter, Editor of SmartMoney.com, has some tips for making college more affordable.

Between inflation, student competitiveness and school selectivity, college costs are rising - fast. Your best bet is to start saving now so that you have some money put away for your children when they're ready to start college. "In 18 years, these numbers could be $175,000 for a public school and $375,000 for a private school [for four years]," says AuWerter.

For starters, try a 529 college savings plan. "The account grows tax deferred and withdrawals taken for college costs are tax free," says AuWerter. Picking the right plan, however, can be a little tricky. AuWerter suggests looking at your home state's plan first, but if the investments aren't great or the fees are too high, look elsewhere. For a breakdown, click here to visit SmartMoney.com's article on the best and worst 529 plans.

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What to do to save for college

Posted by Lindsey Connell

It is important to know both how to save and when to start saving for college. The first important thing to know is that the sooner you begin saving, the better. Parents should begin putting money aside for their child’s college fund the moment they are born. Also, once the child begins working, they should immediately begin putting aside a percentage of their income for college. Another helpful tip is to invest in stocks because stocks are best for your college saving portfolio. Besides this, most people saving for college think they have to have the entire amount saved, but loans and grants can bridge the gap between what you have saved and what the school costs. Even with this in mind, it is important to save as much money as possible because with the economy down and more people requesting scholarships and loans, the chance of getting one is slightly more challenging. Another tip is to consider 529 college plans but it is important to know that they can be extremely expensive. With this plan, the account grows tax deferred and withdrawals taken for college costs are tax free.

http://money.cnn.com/magazines/moneymag/money101/lesson11/

http://money.cnn.com/2005/08/10/pf/saving/willis_tips/index.htm

http://www.cbsnews.com/stories/2008/04/20/uttm/main4029687.shtml

Do not let money ruin your honey

By Jameel Murray

Money issues are often cited as one of the top reasons for divorce in the United States. Recently, Shaquille O’neal and his long time wife Shaunie O’neal filed for divorce. Shaunie O’neal claimed that her former husband hid and kept money away from her while the Cleveland Cavaliers star claimed his wife mismanaged funds which included her buying a house for their personal trainer. The couple did not sign a prenuptial agreement, which would give Shaunie O’neal half of the couple’s assets. This story is yet another example of how important financial responsibility is to keeping a healthy relationship.
Managing finances as a couple is extremely important. Whether a couple both are financially well off or not, differences in the money management of a couple would cause major difficulties in a relationship. Money is one of the most sensitive subjects of any relationship. Studies have shown that the spouse that makes the more money tends to control all the financial decisions in a relationship. Many financial advisers suggest that couples have two separate checking accounts. This would allow both couples to individually manage their funds.

sources: http://www.nydailynews.com/gossip/2009/11/10/2009-11-10_shaqs_wife_shaunie_0neal_files_for_separation.html

http://www.fool.com/personal-finance/saving/how-to-guide-manage-money-with-your-mate.aspx

http://www.msnbc.msn.com/id/20108870/ns/today_technology_and_money-money_matters/

Asian Real Estate Investment Market Buoyed in 3Q

Posted By Shawn Gao

The Asian real estate investment market continued to gain momentum in the 3Q of 2009 as capital values generally stabilised, sentiment improved and the bid-ask spread narrowed, particularly for quality yield-accretive assets in prime locations.

Direct real estate investment in Asia jumped 25 percent quarter-on-quarter to an estimated US$9.1bn. Hong Kong accounted for 36 percent of the total volume followed by China, Korea and Taiwan. However, overall transaction volume remained low in the first nine months of 2009, falling by 49 percent year-on-year according to CB Richard Ellis’ 3Q 2009 Asia Investment MarketView report.

The office sector attracted US$4.7bn of investment during the quarter, or 52 percent of the total flow of capital. Residential properties accounted for 16 percent, with the retail sector comprising 13 percent of the total volume. Despite the relatively low transaction volume in the hospitality sector, a total of six hotel transactions worth a combined total of US$300m were concluded during the quarter, surpassing within three months the five transactions recorded in the first six months of 2009. Transactions involving industrial properties also showed signs of improvement with a total of 24 deals concluded between July to September, a similar figure to the total number of deals completed in the first six months of the year.
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There is hope

By Jonathan Tse



On the week of November 7th, there was an all time low of 502,000 first-time claims for unemployment insurance since the week of January 3rd. Some believe that this could be a sign that the problem of joblessness is beginning to be solved and that unemployment rates may begin to decline. This number of first-time job claims was much lower than expected since the estimate for this week was 510,000. It is believed that this is a sign that companies are cutting jobs at a slower pace than at the beginning of the year, but economists say that joblessness rates are expected to rise until they peak during mid-2010. The reason for this is that analysts say that claims must fall to approximately 450,000 or below to indicate that the economy is adding jobs. The concern that there will be a jobless recovery still worries many, but the government is working to improve the situation. President Obama announced that he plans to hold a new jobs forum and economic growth in December. Also, last week President Obama signed a bill that would provide 20 more weeks of jobless benefits to the unemployed. This plan will be funded by extending the long-standing unemployment tax on employers to 2011.

http://money.cnn.com/2009/11/12/news/economy/initial_claims/index.htm
http://www.reuters.com/article/ousivMolt/idUSN0243717320091112
http://www.nytimes.com/2009/11/13/business/economy/13econ.html?_r=1&ref=business

How to Budget Money During College

Posted By,
Meredith Anderson

College tuition is expensive enough these days. When we budget our money we might not realize how much er spend on our daily expenses. Rent, eating out, books, clothes, alcohol, and daily coffee runs, are expenses that we might not always budget for but in reality probably spend the most on.



There are a couple things that will help reduce our expenses by a lot. Reducing your meal plan to only purchasing a realistic amount is a good start. Most of us have double the meals we actually use a week. Right there is hundreds of dollars a month we can save. Buying used books is not as fancy as brand new ones, however each semester you can save a couple hundred on books that are already highlighted, and you probably won't look at ever again! Of course then there are the simple things that can save us over time. Making our own snacks, coffee, and evening reusing notebooks will add up after four years.

Its important to stay informed about your finances. Try to use cash as much as possible and make simple lists and spread sheets to keep track of your expenses. It is true that not everything we learn in college will matter after graduation, however the way you manage your money will be a life time lesson to remember.




Sources:
http://collegelife.about.com/od/moneyfinances/qt/savingmoney5.htm
http://www.msnbc.msn.com/id/14448831/
http://www.bankrate.com/brm/news/sav/20000814b.asp

Personal Finance: Time to get serious about Roth IRAs

For so many years, people have planned for retirement thinking that they would pay lower taxes than they paid while working. However, it’s no longer a sure thing.

Many people have saved money toward their retirement by putting it into tax deferred accounts. They will have to pay taxes on that money as they take withdrawals. Approximately 85 percent of Social Security benefits will be taxed for many of these tax deferred savers.

In 2001, the federal deficit was out of control and tax cuts were set by President Bush that are set to expire in 2010. This creates a chance that tax rates will be much higher than they were over the last decade.

Roth IRAs were created in 1997 tax legislation. Roth IRAs allow workers to put away money that could build tax-free for retirement. Contributions to Roth IRAs do not qualify for tax deductions, but the money that is withdrawn years later, in retirement, is not taxed. That is especially beneficial to younger savers whose accounts have many years to earn interest, dividends and gains that can compound over time. The law that created Roth IRAs also included provisions for allowing taxpayers to convert their existing tax-deferred IRAs into Roths.

But Roth IRAs have had their limits, too. Only taxpayers who earn less than $105,000 ($166,000 for joint filers) in 2009 can contribute the maximum amount ($5,000 per person, with a $1,000 additional catch up contribution for folks 50 or older) to a Roth IRA. And only people earning less than $100,000, single or married filing jointly, can convert their traditional IRAs to Roths.

In 2010, some of those rules will change. That $100,000 limit disappears, so folks with higher incomes can convert traditional IRAs to Roth IRAs. Deciding whether to do that, and how to go about it, is going to be difficult and complex. Here are some considerations.

Source 1

Source 2

Source 3

Posted By: Amy Nightingale

Celebrities are in Debt Too

In our current economy, we all seem to focus on the common persons’ financial issues. Yet we should keep in mind that celebrities get hit just as hard, maybe even harder, than us. They are human too and have the same financial issues as others whether they are bogged down from the stock market decline or are obsessed with purchasing items that they know they can’t afford. Anyone can get wrapped up in a specific lifestyle and lose track of their budgets and overall financing. For example, Mike Tyson was commonly known to make outrageous purchases which put him into some major debt over the years. His most news worthy purchase was a set of tigers! Apparently he was paying about $500,000 per month to keep up his lavish lifestyle, even though he couldn’t afford it. He was a person who spent money on whatever he wanted. Another celebrity who was financially hurting a few years ago is Donald Trump. Even though this man owned multiple hotels, plazas and casinos his own personal liabilities came to $900 million alone. About a decade ago, Trump’s three casinos and Plaza Hotel were pushed into bankruptcy. He also lost his yacht and Trump shuttle, and lost his mansion and $14 million in his divorce. It goes to show that the common person is not the only one with financial issues.

References:
http://moneycentral.msn.com/content/SavingandDebt/P75072.asp
http://www.gotdebt.net/85-even-celebrities-sink-deep-in-debt.html
http://www.nationalpayday.com/education/news/19-celeb-loan.asp

By: Kelsey Hoffman

Investing by burgers and beer

By Beth Kowitt, reporter
November 3, 2009
Posted by Alma Zhumgulova

NEW YORK (Fortune) -- You decide you're going to have some friends over to watch a little NASCAR. You hit the supermarket and buy some burgers, hot dogs and a 12-pack. You get home, fire up the grill, turn on the tube and let your dog out.

What does all this have to do with investing?

Steaks, beer, cable, car racing, pets -- those are all businesses that Intrepid Capital (ICMBX) fund manager Mark Travis owns stock in. They don't exactly fit the traditional definition of consumer staples, but even in an economic downturn, he says they're not going away.

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How to invest $10,000 right now

By Harry Domash

Posted by Lily Mei

You're not rich. You own a few mutual funds in a 401k or an individual retirement account. And you're ready to take the next step: to buy a few stocks with $10,000 or so sitting in certificates of deposit or languishing in a bank account.

But how do you get started?

Let's begin by admitting this much: All of us, no matter how good we are at stock picking, are going to pick an occasional loser. That's why diversification is important. How many stocks must you own? Opinions vary, but dividing your $10,000 into 10 chunks of $1,000 each is probably sufficient. With many discount brokers charging less than $10 a trade, the commissions won't be significant.

However, different folks have different investment needs. I'll describe three strategies, including links to screens to see today's picks. Feel free to mix and match the stocks turned up by the screens or stick with the strategy that best suits your needs.

I used free online tools to build these three screens. The first two use StockScreen123, arguably the most capable free screening tool available on the Web. The third uses the Finviz.com screener, which I find easier to use but not as capable.

As tools, screens work best if rebalanced every six months. Rebalancing means that after six months, you'd rerun the screen and update the portfolio based on the new screen results.

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Increase in Roth IRA Conversions

Posted By, Meredith Anderson

In retirement, your paycheck might go away, but taxes won't.
Still your tax bill can be hard to predict. To have some control over how much you pay the government each year, you should have both taxable and non-taxable accounts from which to draw your retirement income.
Imagine it this way. Perhaps early in retirement you choose to continue to work part time and supplement your income from retirement savings accounts. The combined income may put you into a higher tax bracket. However, if you take some money from a Roth IRA that year, because withdrawals are nontaxable, it could help keep you in the lower bracket.
In later years if you're not working and hitting the next highest tax bracket isn't an issue, you can pull more money from a traditional IRA or 401(k) account.
This type of tax diversification is one of the primary reasons people choose to put some of their money in a Roth IRA, or convert to such an account.

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GETTING PERSONAL: Wealth Transfers for Family Businesses

NEW YORK (Dow Jones)--The same weak economy that has stymied some family businesses' plans to sell their operations makes conditions ideal for transferring ownership within the clan.

"With business valuations depressed and interest rates near historic lows, owners can use wealth-planning strategies, such as trusts and other techniques, to pass bigger slices of their businesses to their heirs more cost-efficiently," says Joseph Fahey, the national director of business planning services for Wells Fargo & Co.'s Private Bank.

This can be achieved through a combination of tax-free gifting and sale techniques that freeze the value of a business at today's trough in the business cycle, advisers say.

Cornelia Spring, Northeast Head of Wealth Advisory for J.P. Morgan's Private Wealth Management, says she advises business owners on setting up short-term grantor retained annuity trusts, or GRATs, which are used to pass assets to heirs free of gift and estate tax. If shares held in the trust appreciate at a faster rate than a special Internal Revenue Service rate--which is 3.2% in November--then the upside value goes to the heirs at the trust's maturity.

"It's a way to transfer ownership to the next generation. There is no limit on how much or how often you do this, so it can be a powerful tool if repeated multiple times," she says.

Click here to read more.

Posted by Kelsey Hoffman

Why Most Twentysomethings Don't Understand Personal Finance

By: MIA SAINI (OC), HARBUS Board of Directors & Section Representative

Posted: 11/9/09

Planning a wedding? Worried about how to pay off your student loans? Debating if you want to buy or rent an apartment next year after graduation? These are all decisions that can be made if one has a command of his or her personal finances and financial goals, both in the short-term and long-term.

As a personal finance junkie, I am often asked how I developed my knowledge on personal finance when I never had formal training during all my years of being schooled or even while I was working at Goldman Sachs. My knowledge of personal finance was built by various encounters with really smart financial experts I met after I graduated from college and was about to enter the "real world." Because there were very few fun resources out there to teach me this stuff, I found learning the information to be very boring but nevertheless extremely useful to how I planned to live my one wild and precious life.

When I found out one of our classmates, Alexa von Tobel, decided to take a leave of absence from HBS to pursue her dream of launching a website to make personal finance fun and exciting, I was thrilled for future generations of smart twentysomethings to have the ability to finally develop a mastery over their finances.

Right before Alexa graduated from Harvard College in 2006, she was sitting around a table with a group of friends, discussing how ridiculous it was she had never had a single class on personal finance. Ironically, Alexa was going to work as a trader at a hedge fund and had just deferred Harvard Business School for two years. Similar to me, Alexa realized the dearth of her personal finance knowledge was extremely apparent. After scouring various resources, she kept finding herself dissatisfied with what was readily available. She found that most personal finance education tools rarely began with the basics and that none spoke directly to her.


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Posted By: Amy Nightingale

Debt Management

By Quang Nguyen




Many people say that the average Americans are loaded with the credit card debts. According to CardWeb.com, each American household has at least $10,700 credit card debt on average. However, having debts on your balance sheet not specifically a bad thing.

If you borrow for a home or college tuition, it usually makes good sense. But before you borrow money, just make sure that you can afford to pay back and try to find the best rates. Besides this, in common sense, most of the debts are bad. So always rely on the credit card to pay for things you don’t really need is not the right thing to do. So how to make your debts under control?

First of all, you can get a handle on your spending, which means make sure you think carefully before any purchase --- Do you really need the product or service? Can you afford it?

Secondly, always pay off your highest interest rate debts first. The key to get out of debt in an efficient way is to pay off the debts which charge the most interest. Once the highest debt is paid down, move to the second highest debt, and so on. In addition to this, watch where you borrow is also an important factor to make your debt under control.

Finally, there is one more thing to keep in mind --- get help as soon as you need it. If you think you are not capable to pay off your debt on time. You should start to seek for help immediately before it turns to be a financial disaster. There are many reputable debts counseling agencies may assist you with mange your debts and improve your financial situation. So don't feel hesitate to get advices from these professional agencies.

References:
http://www.mint.com/blog/train-wreck/debt-management-the-bike-that-crashed-me-financially/
http://www.cgmahq.org/Assistance/Programs/Deb.htm
http://cardweb.com

Make money in 2010: The economy

Posted by Quang Nguyen




You may not feel as if we're out of the woods yet. But the consensus among the 50 leading economists regularly surveyed by the Blue Chip Economic Indicators is that the recession is indeed over, and from a technical standpoint at least, probably ended in the summer.

You're right, though, to feel less than sanguine about this pronouncement. The majority of those economists put growth at just 2.5% next year, and several believed 1.7% was closer to the mark -- well below the U.S. long-term average of 3%.

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Making College Affordable

By Linda Stern

WASHINGTON (Reuters) - The college application process that dominates senior year for many high school students is always stressful, but this year it's even worse.

A report from the College Board shows that college costs continue to rise far faster than parents' salaries: In-state public schools are pushing $20,000 a year and it costs double that to attend the average private college.

At the same time, college savings account balances have fallen, other costs have risen as many parents face unemployment, debt problems and other financial challenges. And more students than ever are applying for college, providing increased competition for the most coveted seats and scholarship programs.

Feel discouraged yet? Don't be. Instead, remember that there are many, many paths to happiness and success that don't run through Harvard yard or Yale's central campus or even straight through any four-year program.

Go out and talk to folks in their mid 20s, and you'll discover many, many people in great jobs and happy relationships who transferred into (and out of) those top name brand schools, took pre-college breaks, started at community colleges, finished at their state schools or took myriad other routes to their current situations.

So avoid worrying and avoid the stress-spewing mother (you know who she is) who waits for you in the parking lot at all of the soccer games wanting to know how your kid is doing on his apps.

Click here for more information

Could the Supreme Court Boost Mutual Fund Fees?

Posted by Jonathan Tse



By David Bogoslaw

Investors in mutual funds may need to brace themselves for higher fees in the future if a case under review by the U.S. Supreme Court results in a substantially different legal standard for judging whether or not fund advisory fees are excessive. On Nov. 2, the Supreme Court heard oral arguments in Jones v. Harris Associates LP, in which the plaintiffs—individual shareholders in the Oakmark Funds—claim the mutual fund adviser, Harris Associates, violated its fiduciary duty by charging them fees that were double those the adviser charged institutional investors.

What complicates the case is the fact that Chief Judge Frank Easterbrook of the Seventh Circuit Court of Appeals, in ruling for the defendants, rejected Gartenberg v. Merrill Lynch Asset Management, a decision by the Second Circuit Court of Appeals in New York in 1982 that has served as the legal standard by which all excessive-fees cases have been evaluated for nearly 30 years.

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Strategy on Buying Health Insurance

By Quang Nguyen




Insurance is what most people planning to get when living in the United States. Since the medical cost is too high, it is important to get the right insurance. Especially with the current economy, with the increasing amount in medical cost, Americans should look for plans best fit for themselves and prevent from looking for ones with lowest premiums. Choose the plan that’s most important to you.

You can begin with the group plans from your employers. Group plans are usually a lot cheaper than individual plans. I suggest you should get insurance and health benefits from your employer even if they might pay you less than someone else that do not offer benefits.

There are 3 main types of insurance plans you can select. The first one is health maintenance organization (HMO). The second one is preferred provider organization (PPO). The last option is high deductible health plan. Fee-for-service still exists, but the use of it has been decreasing.

Choices are limited if you choose HMO, because you can go to doctors that are associated with HMO’s network. The advantages are that you don’t have to pay deductible and co-payment, and it is a low-cost option.
For PPO you can go to the doctors without its network and only pay a small portion of co-payments. High deducible health plan allows deductible to be higher. The plan is connected with a health savings account. You can save pretax amount in the savings account and withdraw it when you need to pay for deductibles.

In conclusion, it is important to find the insurance plan that fits you. Different people have different needs. A single mom might have a different insurance plan than a senior citizen. You should talk to your doctors before purchasing an insurance plan in order to make sure it covers your needs.

References:
Source 1
Source 2
Source 3

Be a smarter charitable giver

Posted by Quang Nguyen




When it comes to charitable giving, some well-intentioned moves can backfire.

Here's how to make sure your donations have the biggest possible impact, whether you're giving on a large scale or a small one.

Don't be swayed by a pretty face. You like to think you give money based on the worthiness of a cause, but less elevated emotions are often involved. According to a 2005 study led by economist John List at the University of Chicago, people are far more likely to give when a fundraiser is an attractive woman rather than a plain Jane.

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Where is the economy going?

By Jonathan Tse



We are now in the worst recession since the Great Depression. Although the economy seems to be recovering, increasing at a 3.5% rate in the past July-September quarter, the unemployment rate continues to rise. For the first time since 1983, the unemployment rate has hit double digits. In October, the unemployment rate was 10.2, representing almost 16 million jobless Americans. October was the 22nd consecutive month of rising unemployment, which is the longest record of growing joblessness in the past 70 years. The unemployment rate is expected increase beyond 10.5 percent because employers are still reluctant to hire. Demand for oil and other commodities have also been on a decrease as consumers are still not confident in the market and are not willing to spend. Oil prices have dropped 2.8% in October during the same time payrolls for workers dropped $190,000. President Obama signed a new unemployment insurance bill last Friday that not only aids homeowners and the jobless, but also aids businesses. This bill allows businesses to recognize their losses from 2008-2009 and to apply them to any of the past 5 years, before 2008, so they are able to get tax refunds on the taxes they paid in those five years. The only catches are that companies who have accepted TARP money are not eligible and tax refunds for the fifth year are reduced by 50%. This will benefit companies who have suffered the most during the recession.

http://www.google.com/hostednews/ap/article/ALeqM5gNiyJ905Ho0Ur96V2TQhsBX19lGwD9BQ6PG00
http://www.bloomberg.com/apps/news?pid=20601087&sid=a_GNhLXtDs0M&pos=2
http://money.cnn.com/2009/11/05/news/economy/tax_breaks_for_business/index.htm?postversion=2009110611

Daycare is A Major Cost for Working Parents

By: Sara Sindelar

When people start up a job they don’t always factor in the cost of childcare for the future. When you have both parents working and their children are under school age, daycare is a must. If it is a nanny, which can get very expensive, a public or private day care or a family member who will help out you need an option. Daycare is a must for working parents to keep their jobs. With rising fees like licensing and inspections that are being proposed are causing fear among parents. The issue of daycare varies across the nation. Some states are fighting for the best option for the residents while others are raising fees and getting strict on laws.

Daycare today is growing in cost averaging from $250 to $1250 per month. Some companies offer daycare but costs are still high. When looking for a job daycre may be something you think about in your compensation package. Another way to discount your daycare costs is to see if your employer offers a tax-free spending account for childcare like most offer a health care tax free spending account. Though this is not something recent graduates may be looking into in a job it is something to think about for the near future.

http://www.washingtoncitypaper.com/blogs/citydesk/2009/11/05/daycare-fight-continues-union-files-new-lawsuit/

http://www.kgun9.com/Global/story.asp?S=11404009

http://www.babycenter.com/0_daycare-centers-how-much-do-they-cost_6056.bc

The downside of debit cards

Posted By: Sara Sindelar

Rising rates and soaring credit-card fees mean many are switching to debit cards. But there are risks to using debit cards as well.

By Gerri Willis, CNN personal finance editor

November 2, 2009: 3:40 AM ET

NEW YORK (CNN) -- Out: credit cards. In: debit cards. As more and more Americans shun traditional credit cards, they're turning to debit cards. But you should know there are downsides to debit cards too.

1. Security

This can be a big issue -- You know that if your credit card is stolen, you're not responsible for unauthorized charges over $50. But if your debit-card number is stolen, you have fewer protections. First off, you have to report any misuse within two days to get the same $50 limited liability. If you miss that deadline but you report the loss or misuse within two months, you could be on the hook for up to $500. After 60 days, your liability is unlimited. Card issuers do have different policies though-so make sure you go through the fine print says Curtis Arnold of cardratings.com.

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How to Save on Health Insurance

By: Nicole Nelson

With open enrollment for many plans starting soon, it is important to know how to chose and maximize your health insurance plan. This may mean changing such things as deductibles, co-pays or co-insurance. It could also mean that you should start buying your own insurance, or switch to your spouse’s plan. In determining whether you should sign up for a high or low deductible plan, you should consider how many times you use your coverage during the year. Usually higher deductibles have lower co-pays and lower deductibles have higher co-pays. Therefore, if you are financially stable and a relatively healthy person that doesn’t visit the doctors that often, a lower deductible plan may be a better idea. Also, flexible spending accounts have become easier to obtain and more beneficial. Some employers may also let you have until March of the following year to use these funds. Flexible spending accounts are a good idea because these funds are taken from your pay pre-tax, saving you tax dollars. Also, in determining health care one should look into an HSA (health savings account). These are usually only offered if you have a high-deductible plan. Not all high deductible plans offer an HSA though. There are many options in choosing a health insurance plan. Therefore, all options should be considered in finding the best option for you.

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The Cost of Ending A Marriage

By, Meredith Anderson

Many wouldn't usually think about divorce as a business, however the shocking truth is that divorce is $28 million dollar a year-industry in the United States. The average divorce is about $20,000. When we think of divorce we think of how sad and emotional it is for everyone involved. We tend not to think about the finical price tag on happiness.

When a relationship is bad and you want to get out of it to be happy, its unfortunate that money can be a reason that keeps you in it. Its ironic how much money can break up the marriage in the first place but keep people in the marriage because the cost of divorce is more then they can afford.

So how does it get so expensive? In most divorce cases lawyers and other legal expenses are required. Lawyers are extremely expensive and many times two are needed. We tend to forget that with divorce comes separate living situations, so many times a new home must be obtained. Finally one of the hardest and most expensive parts of divorce is when children are involved. Child support, alimony, and other expenses will add up for years to come. You can leave your spouse but you have legal responsibilities to your children.



Sources:

http://money.cnn.com/2009/10/30/pf/marrying_finances.moneymag/?postversion=2009103004




http://www.bankrate.com/brm/news/advice/19990903a.asp



http://www.nytimes.com/2009/10/24/your-money/24money.html?em

Mo' Money Mo' Problems for Antoine

By Jameel Murray

Besides reading of Nicholas Cage squandering his money, there have been numerous reports of celebrities going broke. One recent report has been the unfortunate story of former NBA star Antoine Walker. According to the Boston Globe, Antoine Walker owes over $4million dollars to his creditors. Walker faces up to four years in prison if he is convicted on several felony charges for writing bad checks. Over Walker’s career in the NBA, he earned over $110 million dollars including several endorsement deals. Walker is yet another example of a celebrity who did not manage his money correctly.

According to several sources, Walker was a big spender. He purchased a suit for each game, gambled hundreds of thousands of dollars, and supported 70 friends and relatives. Some also say that Walker’s driveway reflected an auto showroom, filled with Bentleys and other luxurious cars. Walker also picked up the tab on several team dinners, increasing the former All Star’s debt by hundreds of thousands of dollars. The reason for Walker’s situation basically is a consequence of Walker not investing his money wisely. Had Walker taken a course or two on financial planning, he may have been able to live the rest of his life out of debt. Because he is extremely out of shape, he may never get a chance to play on an NBA team to pay off some of his debt. Walker’s only other option is to take his game overseas.

Sources: http://www.sportingnews.com/blog/the_sporting_blog/entry/view/40285/antoine_walker_picked_the_wrong_place_to_do_too_much_the_real_world

http://www.suntimes.com/sports/basketball/1851241,antoine-walker-nba-broke-28.article

http://dealbreaker.com/2009/10/aw.php

Poor Nicholas Cage. Literally.

It turns out that Celebrities are just like the rest of us- they hate paying taxes just like all the rest of us do. The latest celeb to fall victim to a public personal-finance debacle is Nicholas Cage. According to sources, Cage owes about $6million in unpaid taxes from 2007 to the IRS. He owes more than $350,000 for back taxes from 2002-2004.

Cage's financial troubles are due to speculative real estate investments and accounting techniques. He is now involved in a $20 million dollar lawsuit. He is being forced to sell major assets and investments at a signicantly lower price which he will take as a loss. Cage is faced with huge tax liabilities because of one of his accountant's incomeptence, misrepresentations, and recklessness. His biggest mistake was a failing to file his client's income taxes.

In order to rake up some cash to pay all of his taxes, Cage is being forced to put the following properties up for sale:

His Bel Air mansion for about $10 million.

His Las Vegas digs, also for roughly $10 million.

A $3.55 million mansion in New Orleans' Garden District. Described as "haunted."

A 24,000-square-foot $12 million mansion in Rhode Island.

Source One

Source Two

Source Three

Posted By: Amy Nightingale

Marrying finances - for the second time

Posted by: Nicole Nelson

Written by: Karen Cheney

When Kimerby and Tony Simmons were married last month at a vineyard in the foothills outside Atlanta, they participated in the African-American tradition of jumping over a broom - an act symbolizing their entrance into a new phase of life together.

For Tony, 41, this was the second time making such a leap, his previous marriage having ended in divorce. That breakup "put a big dent in my finances," says the software sales executive. "I thought there was no way I was getting into another relationship."

But then, on a flight from Chicago to Atlanta, he met Kimberly. And, soon, he fell in love. "It was the flight that changed our lives," says Kimberly, 39, for whom this is a first marriage.

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The downside of debit cards

By Gerri Willis
Posted by Jameel Murray

NEW YORK (CNN) -- Out: credit cards. In: debit cards. As more and more Americans shun traditional credit cards, they're turning to debit cards. But you should know there are downsides to debit cards too.

1. Security

This can be a big issue -- You know that if your credit card is stolen, you're not responsible for unauthorized charges over $50. But if your debit-card number is stolen, you have fewer protections. First off, you have to report any misuse within two days to get the same $50 limited liability. If you miss that deadline but you report the loss or misuse within two months, you could be on the hook for up to $500. After 60 days, your liability is unlimited. Card issuers do have different policies though-so make sure you go through the fine print says Curtis Arnold of cardratings.com.

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Senior's Benefits of 're-tiring'

Posted By, Meredith Anderson

People who began collecting Social Security at age 62 and restart their retirement benefits at 70 would get about 76% more a month. The catch is that they must repay what they had already received.

By Kathy M. Kristof Personal Finance
November 1, 2009

The Social Security Administration recently announced that retirees would get no cost-of-living adjustments this year -- and maybe not even next year -- because the inflation measure it uses to determine them has declined for the first time in more than three decades.

Congress and the administration are working on legislation to provide seniors a $250 consolation prize, a one-time check that would amount to about 2% of the average senior's benefits. But retirees may be able to do far better than that by taking advantage of a loophole in the Social Security law. Using this loophole, which allows you to "restart" your retirement benefits years after you've retired, can be risky. But if you're healthy, have some savings and are under age 70, it may well pay off in spades.

Someone who originally retired at age 62 and "re-retires" at 70, for example, would boost monthly benefit payments by 76%, said Brett Horowitz, a certified financial planner with Evensky & Katz in Coral Gables, Fla.

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How to survive this holiday season

By Alma Zhumagulova

Results of numerous surveys conducted on this year’s holiday spending plans show that this year many of the respondents intend to spend less than last year. Everyone is looking for large sales discounts and coupons (at least 20%), free deliveries and competitive pricing. In response to that many retailers are already having sales and discounts, for example, Wal-Mart and Target are decreasing their prices on toys and other gifts.
The top gifts of this holiday season are clothes and small but smart electronics such as notebooks, MP3 players, e-Books etc. Gift cards are promising to be one of the most popular gifts of this season averaging at $35 per card as found by Deloitte’s 24th Annual Holiday Survey. The top store destinations of this season are department stores, grocery stores, internet electronics stores, and candy and sweets stores.
During these difficult times many of us are struggling to make presents to all the loved ones while not overspending when the money is already tight. The right decision is to develop and stick to a certain holiday budget and a gift list. To avoid excessiveness one should set aside some amount of cash for holiday gifts so that one would always remember that the budget is restricted when shopping for gifts. Starting the holiday shopping early on is another good tactic; it gives more time to comparison shop and helps avoid last minute rushes. Now is a good time to get more creative with gifts: make them yourself, arrange fun gift exchanges with family members and friends, organize parties-as-gifts, and make group gifts to a family. Lastly, if you are out of options, give gift certificates for smaller amounts that although being small give the recipients a choice to get what they want.

Sources:
http://www.nacsonline.com/NACS/News/Daily/Pages/ND1102094.aspx
http://abcnews.go.com/Entertainment/WireStory?id=8948891&page=2
http://www.minyanville.com/articles/shopping-retail-consumer-walmart-sales-target-hasbro-mattel-limited-clothing-toys-holiday-cadbury-books-clothes-amazon-apple-electronics/index/a/25242
http://www.alvaradopost.com/articles/2009/10/29/community/doc4ae9f02f096bb757915954.txt

10 Tips to Save on Holiday Gifts

Given the shaky job market, holiday budgets are tighter this year. According to a survey by PriceGrabber.com, 53 percent of consumers are planning to spend less on gifts. Retailers are anticipating greater demands during the holiday season because of higher-than-expected Halloween purchases this year, says Ken Burke, the founder of MarketLive, which does E-commerce research. Already 30 percent of those surveyed have begun their holiday shopping, with 22 percent having started in October. So to avoid the winding lines and sold-out merchandise, here are 10 tips to save you time and money as you kick off your holiday shopping:

1. Comparison-shop online
Left with excess inventory last year, retailers are going to sell fewer items in stores this holiday season. As a result, more people are going to go online for research, price comparison, and convenient shopping, says Burke. In PriceGrabber.com's survey, 70 percent of consumers said they're planning to research and comparison-shop online for the holidays. One way to do that is through sites like ComparisonShopping.com, which aggregates product search results from the 10 leading websites for price-comparison shopping, including BizRate, PriceGrabber.com, NexTag, and Shopzilla. These sites have vendor prices, reviews of vendors and items, and product descriptions. Also, visit FreeShipping.org, which provides free shipping coupon codes for more than 1,710 stores. Other websites have threshold free shipping, where shipping doesn't cost anything after a minimum purchase; Amazon.com, for example, provides free shipping for members whose purchases are over $25.

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Posted by Kelsey Hoffman

Personal Finance: Investing by gender

Men are from risk; women are from caution

SOUTH BURLINGTON — Women and men have different investment habits: Women tend to be more conservative while men are more willing to risk their savings with an aggressive portfolio, a longtime financial adviser said.

“Women, as a whole, are conditioned to seek safety and avoid risks,” said Heidi Clute, owner of Clute Wealth Management in South Burlington. “It’s part of our upbringing.”

“Most women tend to be a lot more conservative in asset allocation strategies,” said Clute, who has been advising clients on financial matters for 29 years. “Women tend to be more defensive in where they invest their money. And men tend to be more aggressive.”

Women on average live longer than men — meaning savings must be stretched for additional years. Women typically earn less than their male counterparts, prompting them to invest more conservatively, Clute said.

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Posted by: Amy Nightingale

Pay less to stay warm this winter

Posted by Jonathan Tse


Money Magazine) -- This year you can score a rare recession-induced break on your energy bill: The combination of a weak economy and a production boom has dropped the cost of heating with natural gas to a six-year low and is keeping a lid on other heat sources as well. But you can still save more. These questions will help you figure out the most cost-effective ways to keep out the cold.

How much will I pay for heat this winter?

If you use natural gas, you'll spend $434 to $1,044 to keep your home toasty, according to the Energy Information Administration. That is 3% to 22% less than last year. You'll also catch a break if you use propane, which is a byproduct of natural gas, since propane prices are forecast to fall 12%. If you heat with oil, you won't be so lucky: Depending on where you live, you'll spend $912 to $1,722, or 0.3% to 18% more. Electric heat costs will range from $792 in the West to $1,526 in the Northeast.

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How to Avoid Dumb Investing Mistakes

By: Lily Mei

Due to recent economic downturn, it has affect many investors decision to moved their money into cash or bonds this time around. To avoid any as I call it “dumb” investing mistakes, the best remedy as Christopher Long, a certified financial planner recommends is to set up a “play” account where you can trade the market to your heart’s content without harming your long-term investments.

He also states to transfer at least 5% of your total assets to an Independent Retirement Account. The reason behind transferring to an IRA account is that with this account any gains you incur buying and selling securities will be shielded from taxes until you withdraw the proceeds, hopefully after you have already retired.

Long also mentions that the only downside with this account is that in the case where you do incur losses, you won’t be able to use them to offset gains in other accounts, as you would be able to do so if you held securities in a taxable account.

Setting up the “play” IRA accounts seems to work particularly well for couples. Long often says that he “encounter husbands who are new and market junkies and incorrigible traders, but whose wives are anxious to take a much more hands-off approach to investing.” With this play account, it gives the husband the freedom to trade and their wife the comfort that in the worst-case scenario, the damage will be limited.

Sources
http://www.moneymorning.com/2009/10/09/stock-pickers-market/
http://portfolio-management.suite101.com/article.cfm/common_investment_mistakes_to_avoid
http://seekingalpha.com/article/54628-10-investment-mistakes-to-avoid

Personal Finance: Credit card companies pump up rates, fees

By Claudia Buck
Posted by Alma Zhumagulova

If you've got a credit card, you've likely been zinged already.

Higher interest rate? Yep. Lower credit limit? That, too. New fees for late payments? Absolutely.

In the months since Congress clamped down on what it deemed as "unfair and deceptive" credit card practices, dozens of credit card companies have been busily hiking fees, rates and penalties in anticipation of stricter rules.

In the last few weeks alone, Bank of America tacked annual fees of $29 to $99 onto some cards and Citibank jumped some annual interest rates to nearly 30 percent.

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Barter for the Services You Need

By: Jessie Bruyn

Camille Tominaro's vacation home near Hunter Mountain in New York could use some new floors and a good paint job, but she doesn't have the money to hire a professional to do the work.

So, to get the job done, she is using another form of currency: her house. In exchange for getting the home improvements done, Ms. Tominaro is offering painters and carpenters a free stay in the vacation home.

Cash-strapped consumers are increasingly bartering to get needed products and services. If you're considering bartering, here are a few things you should know:

Web sites that allow people to post ads for barters, such as Craigslist.org and U-Exchange.com, can help you track down someone who provides a service or product that you want and needs what you have. You can place an ad detailing what you're looking for and what you have to offer in return. You also can respond to an ad you think would be a good fit.

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Donate Your Stuffs

posted by Shawn Gao
When we entered supermarkets, like Wegmans and Price Chopper, in the account desk, there were sign that show we donate money for every time we shop there. These signs are trying to let us know that many hungers need our help. And there maybe something we can do for them. For example, we can donate something for them, In Syracuse, there are many places accept people’s donations. At the end of every term, students can donate their needless books and clothes in the students’ centers. Also, there is a donation center in Erie Blvd where may accept a variety of things that people don't want to have. During economy recession, many people are hungry to death. For people who don't desire money and food so much can do something to help out the poor. After the Halloween, people may have a great amount of candy left. For these candies, people can donate these candies in the original wrapper to those donation centers. Before donations, remember to call the centers to make sure whether they accept those candies or not. People can do something good for the poor with some institutions. Ronald MacDonald House Charities, which includes a program that provides housing for parents of children staying in nearby hospitals. Some people may need help from others. Let us donate something.
1.http://online.wsj.com/article/SB125702566786620951.html
2.http://online.wsj.com/article/SB125694047773419513.html
3.http://online.wsj.com/article/SB125702415622320915.html

Can You Save $500 In Time For The Holidays?

Posted by: Jessie Bruyn

You've seen the green-and-red peeking out between the Halloween decorations and you're already starting to fret. There's a little over seven weeks before the December holidays, and you haven't saved a penny for gifts or entertaining.

If racking up more debt with your credit cards doesn't sound like much of a way to celebrate, the solution may be an austerity plan. For instance, if you slash $65 a week from your regular spending, you could have $500 to spend on the holidays.

Sound like a possibility?

Money management experts say such drastic measures are not the best way to plan for the holidays. "Do you want to go through the process of self-deprivation in order to make this work?" asked Bruce McClary, a financial educator and spokesman for Clearpoint Credit Counseling Solutions. It would be far easier to cut back the guest list for the holiday bash or find ways to give gifts that don't come from a store, he said.

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Credit Card Fraud

Posted by: Jessie Bruyn

Credit Card Companies Are Still Looking For Ways to Make Profits

By: Sara Sindelar

Credit Card companies have always been tricky in getting as much money as they possibly can out of a cardholder. There are 5 ways that card companies really get you. First is rate hikes where they automatically increase your borrowing rate without telling you. Second is adding on new fees to your card. These can include inactivity fees, annual fees, monthly fees, overcharging fees, these can be endless. Third is making a higher monthly minimal payment jumping from 2% to 5% without any advance notice till you receive your bill asking for more money. Fourth is decreasing the amount of rewards you get for swiping your card. Lastly is decreasing your credit limit. A lot of consumers have complained about purchasing something and getting their card denied. The card companies will also cancel your card if it is inactive as a safety precaution but not good when you go to use it and it is denied. These added fees and increases in payments are really hurting cardholders especially those who are living pay check to paycheck and rely on credit cards to make it through.

Congress is working on a reform bill that came out in May for credit card companies to stop all of their pricey tricks. The first part, which will start in February, will put limits on when issuers can raise rates on existing balances and new cards. Congress is hoping that this bill will help credit card holders but there is a great fear that the companies will keep finding ways around it to make a profit.

http://www.thedenverdailynews.com/article.php?aID=6195

http://www.fortmorgantimes.com/ci_13674428

http://money.cnn.com/galleries/2009/news/0910/gallery.credit_card_evil_things/index.html

Remodeling? It's a waste of money

Posted by: Lily Mei

By Liz Pulliam Weston
MSN Money

There could be one upside to the real-estate implosion. Plunging prices finally could shatter our national delusion that home improvements are somehow an "investment" in our homes.

Think about it:

* With a real investment, you commit your money and hope to make some kind of profit.
* With remodeling, you're all but guaranteed a loss.

Even at the real-estate market's peak, most remodeling projects didn't pay for themselves.

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Investment Options

By Jonathan Tse


Although stocks have been seen to be steadily rising these past few weeks, it seems that stocks prices have recently stopped rising and are beginning to fall again. Sadly, hopes that the economy may have finally been coming out of the recession have been wrong. It is thought that there will still be some time before true recovery of the economy arrives. A reason for this is the low consumer confidence rating, as consumers are still not very confident to invest as much as they would have before the recession. It is said that the current economic situation parallels the recession of 1973-74 in which the market fell more than 45% and then rebounded 60-70%.
A strategy to make profit during this time of economic hard times is to build a portfolio that is split into five parts: US stocks with constant dividends, mature foreign stocks and bonds, stocks and bonds from emerging markets, oil and commodity stocks and bonds, and bonds that return based on inflation. This type of portfolio diversification will allow investors to make decent profits even while still investing in cheap investments that other investors are afraid to take part in. Exchange traded funds (ETF) are also another option to invest in while the economy is not doing too well. There are five recently launched ETFs that appear to be profitable and will help to diversify one’s portfolio. Some rising countries have new ETFs which investors should look into. The top five include: Vietnam, Indonesia, Peru, Colombia, and Nordic region. International investments are some things to look into to invest in while the economy is in recession.

http://www.businessweek.com/blogs/personal_finance/archives/2009/09/new_normal.html
http://www.investmentnews.com/apps/pbcs.dll/article?AID=/20091028/FREE/910289998
http://www.straightstocks.com/indonesia/five-hot-new-international-etfs-to-consider/

Getting Paid to Take Care of Mom or Dad

Posted By: Sara Sindelar

Edited by NIKKI WALLER

A huge swath of Americans -- nearly a quarter of the adult population -- provide long hours of voluntary care for older or sick family members and friends. These numbers are likely to grow as the population ages and more people live longer.

A small but growing number of families are taking an unusual step to acknowledge family caregivers. Rather than leave uneven bequests for their heirs, they are entering into formal "caregiver contracts," in which adult children or other relatives are hired, for modest salaries, to take care of elderly or disabled family members.

These arrangements, also called personal-service or personal-care agreements, help reward family members for the significant amounts of time, effort and money they often spend taking care of an elderly relative. They also can help reduce the size of a person's estate and may prevent battles between siblings and other family members.

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Getting a Mortgage In This Day and Age

By Jameel Murray

Getting a mortgage can be extremely difficult these days. Mortgage lenders are paying an increased amount of attention to several factors. One of these factors includes a borrower’s credit score. Lenders are requiring that a borrower have a credit score no lower than a 660. This can be one of the determining factors in one’s mortgage payment. In the past, borrowers with a high debt-to-income ratio such as 55 percent were able to receive a considerable amount of loans. After the housing crisis, the maximum percentage of debt ratio is around 40 percent. Another determinant of the amount of loans a borrower may actually receive is the borrower’s actual income. In the past, borrowers were known to exaggerate their earnings but now lenders are requiring borrowers to provide verification of income through a series of paper work. A borrower’s liquidity also determines the amount of loan coverage one may actually receive. Banks are requiring borrowers to have an adequate amount of money available to cover payments.
Even though these requirements may scare some borrowers away from buying a home, there are several options borrowers are presented with. One option may include the idea that borrowers may need to put down a more sizeable down payment on a home. This ensures a lender’s trust in your request for a loan. Borrowers also need to have their finances set before going in for a loan. If finances were erratic, lenders would be discouraged to lend off money. One last option a borrower may have is to purchase a house where the value is going to increase. Banks may deny borrowers loans based on the speculation that a home’s value may decrease.

Sources: http://www.nytimes.com/2008/06/01/realestate/01cov.html?pagewanted=2

http://www.bankrate.com/brm/mstep.asp

http://www.bestsyndication.com/?q=20091025_finding_the_best_home_mortgage_rate.htm

Fun ways to learn Personal Finance

By Alma Zhumagulova

In the face of the economic crisis there have been many articles, news and TV shows on how to avoid financial problems. People became aware of the many mistakes they made in managing their finances. Everyone knows that it is always better to prevent the problems than to try to correct mistakes when they happen, and it is always better to start as early as possible. Recently, the media has been bombarded with suggestions on how to do that. To recover the economy it is necessary to teach the young generation how to avoid the mistakes of the past generations.
PBS runs a show that teaches young adults some basic financial knowledge such as choosing the appropriate credit cards, avoiding and getting out of debt, insurance and retirement planning, budgeting and saving for long-term financial goals.
Universities and colleges are adding personal finance classes to their class offering. George Washington School of Business has added Personal Finance class to its curriculum that is available to juniors and seniors of all majors. Even some high schools are starting to do that, for example, the Medway High School in Massachusetts. The semester long class covers such topics as credit, stock market, debt, income, spending and saving.
However, children and young adults might think that they don’t need to be concerned about these issues at this stage of their life, it might seem too boring and difficult. To increase their interest and teach finance in an easy and fun way there are financial computer games such as Celebrity Calamity in which the player acts as a financial manager of a celebrity, The Great Piggy Bank Adventure – a game for children of age 8 to 14, Stagecoach Island and Moneytopia. The players of these games can make mistakes and learn by them which would be very costly in the real world.
Even though these means of introducing children and young adults to finance do not guarantee that children and teens will learn and remember all the lessons taught, these means will at least help to increase awareness among this age group about the many financial issues they will face in just a few years.

References:
1. http://media.www.gwhatchet.com/media/storage/paper332/news/2009/10/29/News/School.Of.Business.Adds.Personal.Finance.Course-3817252.shtml
2. http://www.chicagotribune.com/business/yourmoney/chi-tc-biz-ym-fun-1025oct25,0,2823992.story
3. http://video.pbs.org/video/1245775469/
4. http://www.boston.com/news/education/k_12/articles/2009/08/20/schools_in_west_suburbs_push_new_personal_finance_curriculum/

Loans Inrease

By, Meredith Anderson

With the economy where it is now people are taking more and more loans. It seems scary to be borrowing money but it’s one of the greatest ways that is keeping the economy stimulated. If people don’t have the money to buy anything business will go out of business. As risky as it sounds people that are taking loans and paying at least some of them are actually helping the economy grow ever so slightly. Business and banks are offering even lower loan rates to attract more people. Auto companies are offering cheaper prices on cars as well as offering lower loan interest rates. Home prices have become more affordable do to the decrease in real estate action. Student loans have increased over the past couple years as well, however, not because of the idea that “this is the time to buy,” but because of the increase in college tuition and the decrease in many families incomes.
All these three types of loans are stimulating our economy now but how will they affect us later? If the economy doesn’t bounce back to where we predict than many people will become even more in debt. The problem with loans is that they seem great and are easy to obtain. Because it is so easy to obtain these loans people are buying homes, cars, and other items that they couldn’t usually afford and will have a lot of trouble paying back even if the economy does turn around.

Sources:

http://www.ed.gov/news/pressreleases/2009/09/09142009.html

http://www3.myautoloan.com/articles/myAutoloan-com-Experiences-Dramatic-Increase-in.htm

http://www.allbusiness.com/business-finance/business-loans/938679-1.html

Strategy on Buying Car

By Quang Nguyen




Most people look forward to buy their first car and their first house. When buying car, people do not think carefully about the process. Here lies the issue, buying a car can be a difficult task and much of the simple steps are commonly overlooked.

First of all, you need to evaluate your current financial situation to find out how much you can afford in terms of whether you are going to finance the car or buy it outright. If you are buying a relatively new car, chances are you will have to finance the car and pay monthly payments.

New vs used is a common question people ask themselves when buying a car. You may be able to afford more car by going used but you know what to expect from the car when buying new. If you take the used route you are going to want to learn about the cars history. Carfax.com is a great site that provides the “medical history” of the car. It will let you know what the cars history has been like in terms of it being in the shop. You will need to know the title of the car. Usually, it is not a good idea to buy salvage title car even though it is very cheap.

In conclusion, you will need to budget yourself properly to ensure that you can afford the monthly payments if you chose to finance the car. You must also take into consideration the cost of insurance as well as put money aside for unexpected costs the car may incur. Maintaining your car can be as much as several thousands dollar each time. Gas can also costs as much as several hundreds dollar a month.

References:
http://auto.howstuffworks.com/buying-selling/car-buying.htm
http://www.carbuyingtips.com/carintro.html
http://www.boingboing.net/2008/08/13/how-to-buy-a-new-car.html

Benefits of a 401(k)

By: Nicole Nelson

A 401k is an employer-sponsored retirement plan. The term 401k comes from the fact that the origination of these types of plans comes from section 401k of the Internal Revenue Code. A 401k plan is a defined contribution plan that lets an employee make pre tax contributions to their plan. 401k plans take money out of employee’s paychecks before they are taxed, reducing taxable income. These funds are then invested into various funds in the 401k plan, decided on by the employee.

401k plans can be very beneficial in retirement planning because of their benefits. One benefit is that the employee is reducing their taxable income, which can be beneficial when paying taxes as opposed to taking money and investing/saving it after being paid. Also, growth in 401k accounts over the year is taxed deferred, again saving money in taxes. Also, many employers give employees the chance to get “free money” from their participation in 401k plans. Employers match contributions (up to a certain percentage depending on the plan) if employees are contributing enough of their own money. Also, it is known that the sooner you start saving, the larger your funds will become in the future. Therefore by putting money into a 401k can easily grow over the years. Another benefit about 401k’s is that you can borrow against your own funds. 401k loans are common and you are technically borrowing your own money. The downside about this is that you loose the chance of earning money on the investments that you will be missing out on because of the loan.

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Unemployed tap their 401(k)s

Posted by: Nicole Nelson

By: Ben Rooney

NEW YORK (CNNMoney.com) -- Nearly half of U.S. workers who left their job last year cashed out their 401(k) accounts, according to a study released Wednesday, despite ongoing efforts to dissuade Americans from doing so.

Hewitt Associates, a global human resources consulting firm, said 46% of employees who left their job last year took a cash distribution from their 401(k) plan.

The "alarmingly high" number, which was based on a study of 170,000 401(k) participants, has remained virtually unchanged since 2005, the group said.

Pamela Hess, Hewitt's director of retirement research, said employers and policymakers need to work together to change employee behaviors and reduce 401(k) cash-out rates.

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Personal Finance Website to Debut

By William N. White
Posted by Jameel Murray

After the 2008 subprime mortgage meltdown revealed widespread unfamiliarity with the intricacies of personal finance, one former Harvard Business School student is on a mission to educate young people about managing their money.

On Nov. 15, Alexa L. M. von Tobel ’06 will launch LearnVest.com, an interactive financial information Web site geared toward women.

The start-up features personalized information on credit scores, mortgages, and retirement savings, among other fiscal topics. Von Tobel, who is taking a leave of absence from HBS to work on the project, calls it “the Cliff Notes for personal finance.”

“The bottom line is most people don’t know what the difference between a debit and a credit card is,” said von Tobel, adding that most students at Harvard will graduate without ever having taken a class in personal finance.

Von Tobel—who first envisioned the Web site during her senior year at Harvard—said that LearnVest aims to be more personalized than other financial Web sites. It walks users through financial milestones from getting a first job to paying off student loans, then offers gift cards and other rewards when they complete units on the site.

The Web site is designed for women under 30, though von Tobel emphasized that LearnVest is open to anyone.

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Barter for the Services You Need

By: Jessie Bruyn

Camille Tominaro's vacation home near Hunter Mountain in New York could use some new floors and a good paint job, but she doesn't have the money to hire a professional to do the work.

So, to get the job done, she is using another form of currency: her house. In exchange for getting the home improvements done, Ms. Tominaro is offering painters and carpenters a free stay in the vacation home.

Cash-strapped consumers are increasingly bartering to get needed products and services. If you're considering bartering, here are a few things you should know:

Web sites that allow people to post ads for barters, such as Craigslist.org and U-Exchange.com, can help you track down someone who provides a service or product that you want and needs what you have. You can place an ad detailing what you're looking for and what you have to offer in return. You also can respond to an ad you think would be a good fit.

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3 Ways to Improve any Credit Score

Posted by: Jessie Bruyn

How to Play It: The New Normal

By Jonathan Tse



Every decade or so, investors are told to heed a new megatrend, whose chief appeal is, well, its newness. In the ’90s, investors were sold on the notion of a New Economy that wasn’t subject to the old laws of gravity and, among other things, could support higher stock valuations. And one of the best-selling investing books of the past decade was The New Investment Superstars, a tome that canonized a new breed of fund wizards, some of whom later proved to be mortal. Now comes the latest investment fad, the “new normal,” the idea championed by Pimco bond guru Bill Gross that the U.S. has entered a period of diminished expectations that requires investors to rethink their long love affair with stocks.

There’s a certain Biblical undertone to the new normal orthodoxy: After decades during which consumers lived beyond their means, the nation must now endure a long stretch of lean years during which consumers pay down debt. In the minds of Gross and Pimco colleague Mohamed El-Erian, the prospect of a period of no growth means investors should hold as little as 30% in stocks, vs. the 60% long deemed the proper mix. They also recommend holding more fixed-income assets like bonds and bank loans, as well as commodities.

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redit card borrowers will see minimum repayments double under new proposals

posted by Shawn Gao
he move is part of a package of measures announced by the Government to tackle consumer debt amid the recession.
It said forcing credit card companies to raise the minimum monthly repayments would encourage people to focus on paying off their debt.
The minimum amount that the majority of companies currently require card holders to repay should be raised from just 2 per cent of the amount owed, to 5 per cent, it suggested.
The increase could cut the time a borrower takes to repay a £1,800 credit card debt to ten years – compared with 40 years at 2 per cent. It could also reduce the amount repaid by almost £4,000, according to the Department for Business, Innovation and Skills.
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Chinese investment

posted by Shawn Gao

People in China are willing to invest their money in stock market.
Today, many experts predict that China is the first country that gets out of the recession. As result, Chinese GDP for the first three quarters is above 7percent. Comparing with other developing countries, it GDP growth rate is dramatic higher. The consumer’s buying confidence has been built up this year. Chinese people are willing to invest their extra money in Chinese stock market. People opened their bank account in order to get quick money from the stock market. Chinese stock market has already reached the bottom line; now the index of the stock market is above 3000 points. (The beginning of this year is only 1800) Currently, people are spending their money as they did in 2007. The housing price has been gone up. Shanghai and Beijing, lead-housing price in China, have been reflecting Chinese economy is going well. On August, Chinese Government just started its Chinese NASDAQ. Many new IPO have been operated. And Chinese people now are going to allocate some of their extra money in the new stock market so as to build their wealth.
1.http://news.dichan.sina.com.cn/2009/10/27/78236.html
2.http://baike.baidu.com/view/6240.htm
3.http://stock.hexun.com/2009-09-24/121195063.html

Personal loans lose out on rate cuts

posted by Shawn Gao
WHILE interest rates on home loans fell more than four percentage points between August last year and October this year, the rates for personal loans actually rose during that period.
According to figures from Infochoice, the average variable rate on a secured personal loan from a bank rose by 0.77 per cent to an average 11.43 per cent while that of an unsecured personal loan from a bank increased by 0.16 per cent to an average 13.89 per cent.
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posted by Shawn Gao
There are some few things that one has to consider when he is seeking to obtain a new car loan even if he has a bad credit history.
There are some few things that one has to consider when he is seeking to obtain a new car loan (www.crestcarloan.com) even if he has a bad credit history. The first thing that you have to consider is whether your loan options are better on a new car even if you have a poor credit. Basically, the new automobiles haveixed value in the beginning and clear depreciation schedule which gives a lender room to make his or her decision without any doubt.
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Finding gold in little miners

Posted by Quang Nguyen




Top-ranked metals fund manager Mark Johnson says small gold miners haven't recovered from last year's selloff. He shares his favorite picks.

NEW YORK (Fortune) -- A year ago investors fled small gold mining stocks as the desire for high-risk assets evaporated.

Now, even after investors have flooded back into the market, top-ranked gold fund manager Mark Johnson says the junior miners are undervalued, and he's betting on their recovery.

"The best value is at the smaller end of the scale," says Johnson, who is in his 16th year running USAA's Precious Metals and Minerals fund (USAGX).

Junior miners are those with less than 250,000 ounces of annual gold production, which equates to roughly $250 million in revenue at gold's current price.

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Credit Card Reform Bill Tries to Stop Evil Companies

Posted, Meredith Anderson

5 evil things credit card companies can (still) do
The credit card reform bill tries to help cash-strapped customers, but companies are coming up with new ways to boost profits.

Credit card companies are socking it to consumers left and right.
They're hiking interest rates to as much as 36% and doubling minimum monthly payments, frustrating customers who are already cash-strapped and credit-crunched.
In an effort to curb these abusive practices, President Obama signed into law a credit card reform act in May that's rolling out in three parts over 12 months.
At the same time, credit card companies have been hard at work coming up with new ways to boost profits while sidestepping the reforms.

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Personal Finance: The price of putting off a pension

Question: I have a pension that is available to me, and I wonder about beginning the pension now or waiting. If I take it now, I will get $1,183 a month. By waiting, it increases about 7.5 percent each year to a maximum of $2,071 a month at age 65. I am not in need of the pension at this time. - Gary, Baltimore
Answer: You are wise to be analyzing the possibilities rather than taking what's in front of you now and hoping it works out later.

Research shows that only about a third of people try to calculate what they will need in retirement before leaving a job or starting to take a pension. Years later, bad decisions can catch up with them: Once you take a pension, you cannot go back to your former employer and request a do-over when money is tight. And you might not be able to return to work to cover unanticipated living expenses.

The AARP surveyed retirees a few years ago and found that almost half worry about paying their utility bills. This could have been avoided.

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Posted by Kelsey Hoffman

Underlining 'Free' in 'Free Credit Report'

Posted by: Nicole Nelson

Written by:Michelle Singletary

I've been meaning to pull my credit reports for some time.

I, like so many others, am concerned about identity theft or uncorrected errors in my credit files that might ding my credit scores.

When I finally got around to it, I knew to go to AnnualCreditReport.com or call 877-322-8228. I haven't been fooled by those ubiquitous commercials for FreeCreditReport.com with the goofy guy playing a guitar and complaining about how his life is messed up because he didn't check his credit report.

But the Federal Trade Commission has received many complaints from consumers who were misdirected from the official centralized site. Every person is entitled to a free credit report every 12 months from each of the three nationwide consumer reporting agencies -- Equifax, Experian and TransUnion.

to read more click here

Financial games: It can pay to play

Posted by: Nicole Nelson

Written by:Eileen Ambrose

One of the big hurdles to teaching personal finance to children and young adults is how to do so without boring or confusing them with talk of compound interest and annual percentage rates.

Now, there's a growing effort to reach kids on their own turf: online games.

More than 70 percent of people play some form of games, a percentage far higher among teens. Gaming experts see this as an opportunity to pack critical lessons into a fun activity.

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Finding the Best Way to Save for College: 529 Plan

By: Sara Sindelar

Paying for college is one of the biggest expenses for an individual and their parents. In order for people to be able to afford to send their child off to college they need to start putting money aside earlier and earlier so that it can grow to the cost of tuition when the time comes. A CNN survey states that people save about 3.6% of their annual income for college even though they really need to save 5.7%. The percentage increased from 31% to 44% of those who are confident they will not reach their college savings goal. Times are getting tough with the economy and savings is declining fast.

There are many different ways to save for college with all the investment option available. The most popular method is the 529 plan. A CNN survey states that 43% of people saving for college are using a 529 plan. These 529 plans are state-sponsored programs set up with an asset management company. The individual sets up their account with the company; the income is tax-deferred and the money needs to be spend on educational purposes.

There are a variety of 529s so you have to do some research before picking one out. The key traits to look for are low fees, flexible investment options and diversified portfolios, good performance by fund, and tax benefits. There are so many other options to 529s and you should take these key traits in consideration when picking the option that best suits you especially in the tough times right now.

http://www.chicagotribune.com/business/yourmoney/chi-tc-biz-ym-cruz-1025oct25,0,1624828.story

http://www.cbsnews.com/stories/2009/10/01/earlyshow/contributors/raymartin/main5356031.shtml

http://www.msnbc.msn.com/id/33070796/ns/business-motley_fool/

Financial games: It can pay to play

Online sites provide opportunities to teach lessons to children in a fun way
By Eileen Ambrose Tribune Newspapers October 25, 2009
Posted by Alma Zhumagulova

One of the big hurdles to teaching personal finance to children and young adults is how to do so without boring or confusing them with talk of compound interest and annual percentage rates.

Now, there's a growing effort to reach kids on their own turf: online games.

More than 70 percent of people play some form of games, a percentage far higher among teens. Gaming experts see this as an opportunity to pack critical lessons into a fun activity.

"Think about what games can do that you really can't do otherwise," said Ethan Mollick, an assistant professor of management at the Wharton School of the University of Pennsylvania. "Even in a personal finance class you don't get the chance to experiment, to be in the shoes of someone trying to solve problems.


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Americans expect to focus on personal finance in short term

Posted By: Sara Sindelar

A new survey finds that Americans plan on continuing to increase their savings and investments for the near future.

The survey from First Command found that Americans have less money in their savings accounts and are still paying down their debts at about the same rate as in previous months.

The average amount of money in a short term savings account was said to be $860 in September, down from $1,169 in July but up from $787 in August.

The financial institution noted that more consumers have been applying for debt consolidation loans recently, further adding to the widespread emphasis on personal finance.

In a potential warning sign to the retail industry, the survey also found that 57 percent of consumers plan to scale back their holiday shopping activities this year. This could tie in with a trend where the pace of the economic recovery is held back even as Americans continue to improve their overall personal finances.

By Bill Laforme

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Trend towards health care stocks?

By Jonathan Tse




Recently the stocks that have been performing well are the health care stocks. The reason behind this is the fact that many of the baby boomers are approaching the ages of 50-60 years old. This contributes to the expansion and growth of the health care industry as more elderly people need to purchase health care. It is estimated that in the next 18 years, 4 million baby boomers will reach age 60 and in 2030 the population would consist of 20% elderly people above the age 65. Many people are in conflict because they feel that there is a moral issue involved with purchasing health care stock. Once the economy recovers, some people feel that the health care industry will be one of the fastest growing sectors. Also, because the health care industry has been underperforming for so many years, the stock prices have become very cheap and are now starting to rise in price due to greater performance in recent years. Fears by people on the performance of other industries such as energy and housing have brought more investors to the health care industry, contributing to its current growth trend. Foreign companies have been participating in the recent trend of purchasing health care stock because they are looking for US stocks that are cheap and potentially profitable.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/08/26/BUIE12I1KN.DTL
http://www.forbes.com/2009/10/20/gentiva-amedisys-odyssey-personal-finance-investing-ideas-dress-barn.html
http://money.cnn.com/2009/10/19/pf/funds/forester_health_care.fortune/index.htm?postversion=2009101913

Renting or Selling Your Home?

by Jameel Murray

Because of the current state of the economy that witnessed the sudden decline of property value, many homeowners are faced with a difficult decision, which consists of renting or selling their property. Both options pose significant benefits for the homeowner, but there are also some daunting tasks that homeowners may have to face. If one decides to sell their property, it may generate a great amount of profit that may be used to purchase a new home. However, attempting to sell a home in this current economy may seem like a very difficult thing to accomplish simply because no one is purchasing real estate at this moment.
If a homeowner is not able to sell their property, they can also rent the property out to renters. If your home is in great shape and conveniently located, finding renters may not be a difficult task. The goal of renting is to produce monthly rent to cover expenses such as mortgage, insurance, and property tax. After a considerable length of time renting, homeowners can use the rent as another source of income. Of course there are some cons to renting which includes maintenance and taxation. Maintenance costs are the sole responsibility of the homeowner. If a renter decides to destroy your home, not only does it depreciate the value of the home, it also increases the homeowner’s expenses. Rent is usually taxed as an ordinary income. The tax on rent is gradually higher than the capital gains tax rate. Even though the option of renting does have some downfalls to it, a homeowner may need to seriously consider the option.

Sources: http://www.theepochtimes.com/n2/content/view/24198/

http://www.streetdirectory.com/travel_guide/76029/property_tips/the_advantages_of_selling_your_own_home.html

http://www.rateempire.com/sell/rent.html

Buying Your First Home

By Quang Nguyen



Buying your first home is the ultimate American dream for everyone. Many look at it as a financial decision, however, I suggest you to look at it as a lifestyle decision. If you picture yourself handling the responsibility of taking care of your lawn every week or if you picture yourself as just leaving the condo every night to hang out with friends will result in different housing options. Moreover, mortgage payments require you to save money for at least couple of years so your personality is definitely important when coming to rent or buy. In addition, real estate is immobile, so if you are the type of person who moves every year or the type who stays at one location for many year also counts toward the decision of buying a new home. The neighborhood is also very important since you would not live happily if you live in the wrong neighborhood and has to deal with issues everyday. The goal of owning a home should be for a happy lifestyle instead of a strong financial status.

So when you decide that buying a home is definitely your thing, please think twice on when to buy. Many people think that the real estate market is at the bottom and now is the best time to buy. However, that might not be the case, as the housing market is expected to be much lower. For example, in Miami, it is expected that price would continue to drop 29.9% by next June after it has already fallen 48% for the past three years. The same go for others locations, such as Las Vegas 23.9% and Phoenix 23.4% by June 2010.

When you do decide to buy a home, you really want to buy something special, something that would give your guests an awww when they visit. With the low price on real estate market, it is possible to get yourself that amazing house that you have seen on TV. In Redwood City, CA, a home with elevator and cliff-side setting and bended-roof bamboo originally costed $1.4 million; now you can get it for $1.2 million. In East Hampton, NY, with homes described as "synthesis or architecture, art and science" will take you $4 million. Or do you want to live in a castle? A 1930s cottage and stone castle in California is now on the market for $1.8 million. You want something exotic? How about a house on top of the volcano? With $750,000 and this baby in Newberry Springs, CA, will be yours. How about a lighthouse somewhere in New England like that movie? You can spend $2,873,000 to live in one of those in Deer Isla, ME.

References:

http://finance.yahoo.com/how-to-guide/personal-finance/12819;_ylt=AohAexNh03hSajStj2FjdhUJo9IF;_ylu=X3oDMTE2MzM2N29zBHBvcwMyBHNlYwNob3dUb0d1aWRlcwRzbGsDYnV5aW5neW91cmZp

http://finance.yahoo.com/news/Homes-About-to-get-much-cnnm-699910894.html?x=0

http://finance.yahoo.com/loans/article/107967/strange-homes-for-sale?mod=realestate-buy

FTC Seeking Comments for 2010 Changes on Free Credit Reports

By Faye Mergel
Posted by Jonathan Tse



The Federal Trade Commission (FTC) is changing the way “free” credit reports are marketed. Federal regulators say changes will be in line with the new Credit Card Responsibility and Disclosure (CARD) Act of 2009. The bill was first signed by President Barack Obama on May 22, 2009 with the aim of protecting consumers from onerous fees imposed by creditors. CARD Act also aims at assuring that consumers fully enjoy their rights, including the right to a free credit report once in every twelve months.

Fair Credit Reporting Act (FCRA) entitles every consumer free access to his records with the three major credit reporting agencies (CRAs). The CRAs, Equifax, Experian, and TransUnion, are mandated by federal law to give consumers their free report once a year so they can assess their debt standings. This would help them make better financial decisions since it lets consumers know how well they are doing with their debt management.

However, FTC received several complaints from consumers who are misdirected from the FTC-backed Annualcreditreport.com. As noted by complainants, they were misdirected from Annualcreditreport.com and ended up in commercial sites which claim to offer free credit reports. But it is only after engaging in irreversible deals that they found out about fees charged along their records.

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60-Second Guide to Getting out of Debt

By Motley Fool Staff
Posted by Alma Zhumagulova

Imagine being free of debt -- no more sleepless nights over mounting credit card balances, no more ball-and-chain of debt feeding your anxieties, and no chance of threats from dreaded collection agencies. You can do it! Here's the scoop -- in one minute flat.

0:60 Resolve to spend less than you make
Make it a habit as fundamental as stopping for red lights. Realize once and for all that if you can't pay for it today -- you can't afford it.

0:55 Distinguish between Bad Debt and OK Debt
OK Debt has an interest rate well under 10% -- preferably with some tax advantages to boot. In the best case, what you bought with borrowed funds will appreciate in value. Home mortgages and student loans are examples of OK Debt. Automobile loans are on the border: They often satisfy the low-rate piece, but automobiles almost never appreciate in value. Bad Debt is everything else -- from your titanium credit card to the 35% loan from Larry's Kwik Kash.

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Legally Speaking: Extreme Debt Collecting

by John G. Browning
posted by Jameel Murray

In last week's column, I related the experience of a young Illinois woman who found herself on the receiving end of a debt collection notice - sent via her social networking page!

As I pointed out, the unusual method not only cost the debt collectors a lawsuit for emotional distress, but it also could very well have violated the Fair Debt Collection Practices Act - a federal law passed to protect consumers and set limits on just what debt collectors can do to collect a debt.

But as we'll see, the pressures of today's economy have translated to more questionable debt collection activities than ever before.

There have always been the rare extreme examples of outrageous debt collection attempts. In one case, an El Paso jury awarded a couple $11 million (reduced on appeal in 1998 to $1 million) for what they endured at the hands of debt collectors.

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Six Ways to Kill Your Credit Score

Posted by Quang Nguyen




1. Be a big spender at the wrong time

The bigger your total balance as a percent of your total credit limit across all your credit cards, the lower your score will be.

Rex Johnson, founder of credit union consulting firm Lending Solutions Consulting, has spent years studying FICO credit scores - the most widely used among lenders. Scores range from 300 to 850 - the higher the better, with anything above 760 being the most desirable.

Johnson estimates that you lose 1 point for every percent of your credit limit that you use. So if you have a total credit limit of $10,000 and have an outstanding balance of $4,000 (40%), your score would be 40 points lower than if you had a $0 balance.

Ideally, credit experts say, your never want your balance to exceed 30 percent of your credit limit.

It's always good to pay off your balances every month. But creditors may take a few weeks or even a couple of months to report your payment to the credit bureaus.

To boost your score: Don't charge anything for at least 60 days before applying for a loan, Johnson said. That way it's likely that all the payments you've made to date will be reflected in your credit score by the time a lender requests it.

If you can't pay off your total balance in full, at least keep it under 30 percent of your total credit limit.

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How Bad Are Your Credit Card Mistakes?

Posted by Quang Nguyen



Grade yours on a 10-point scale.

Nobody's perfect. When it comes to our financial lives, we've all done things we later regretted -- whether it's getting slapped with a $3 fee for using an out-of-network ATM or going on a Las Vegas bender and losing the house on an overly aggressive poker bet.

The key is to understand the scale of the transgression. With credit card blunders, that's no easy task -- is it worse to take a cash advance or to pay a bill a day or two late? Experts graded a range of credit card mistakes on a scale from 1 (losing a few bucks to a cash machine) to 10 (losing the house). Find out which worry the pros most -- and which may (almost) get a free pass.

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Personal Finance and Staying Out of Debt

By, Meredith Anderson
Debt can be a scary thing and can haunt us for years if not our entire lives. It’s a constant struggle to stay above the water and keep from drowning in bills and harassing phone calls. The best way is to never get in debt in the first place. Easier said than actually done, however, there are some everyday things we can change in our daily lives that will keep us afloat and debt free. Use cash. It’s simple really, cash is a physical piece of value that you have in your ownership at that moment. Avoid credit card offers and never spend more money on a credit card then you know you can afford at the moment. You should always pay at least if not more than the monthly minimum. The interest rates can add up and end up costing you way more then you put aside.
Things don’t always work out that smoothly and sometimes we do end up in debt. The most important thing is to realize it and not accept it as a new lifestyle. Keeping track of your personal finical statements is very important. Make balance sheets and cash flow statements. Make sure that you are allocating a certain amount of money to repaying your debt and cut back spending where ever possible. You want your income to be higher than your expenses. When you have an extra hundred dollars pay off one of your credit card bills rather than going out for a nice dinner or maybe go out for an inexpensive meal and pay half of the bill. Debt doesn’t have to overtake your life but it should teach you had to be finically responsible.

Sources:
http://www.ehow.com/how_2054053_stay-out-debt.html
http://www.essortment.com/all/tipsonstaying_rhjr.htm
http://www.finweb.com/financial-planning/get-out-of-debt.html

Investing Wisely With Your Money

Posted By, Meredith Anderson

Use your mad money to make money
When you see the market moving fast, it's tempting to swing for the fences. Here's how to play the game safely.
[Related content: stocks, funds, investing strategy, stock market, ETF]
By Christopher Davis, Morningstar
If you were like many investors, you probably wanted to stuff any extra cash you had under your mattress last year. With the markets experiencing their worst crisis since the 1930s, few people had an appetite for risk of any kind. Now that the markets have roared away from their lows -- and the world looks less scary -- you might be willing take some chances.

In fact, you just may not be able to help yourself. In his book "Your Money & Your Brain," author Jason Zweig discusses why we're motivated by the prospect of reward, whether it comes in the form of money, food, drink or other primal, feel-good desires.

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Stopping the Calls

Posted By Meredith Anderson

Even good people can fall behind on their debts.

That's why we should all be concerned when some debt collectors step over the line, as explained in the question below.
Looking for financial advice? Click here to send David your questions and they might end up as a topic for his next column.
Question: Because of the hard times, people fall behind on credit card payments. I would like to know when it becomes harassment on the part of the credit card company calling you. In the last three days, the same credit card company has called a friend of mine 24 times -- as quickly as 2 minutes apart. How do you get them to communicate with one another so they know they have contacted you? It has become very annoying and some of the people that call are very rude. It is bad enough to be in this situation without people harassing you.
-- P.E., Macungie, Pa.

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When you hit 65, it's time to enroll in Medicare 101

by James L. Watt
posted by Jameel Murray

Congratulations — you’ve reached the milestone age of 65! Many things will change, not the least of which is a change in health insurance as you go on Medicare.



Many of you are filled with questions: “Will Medicare be enough?” “What kind of Medicare supplement should I get?” “What about drug coverage?” “Will pre-existing conditions be covered?” “How much will this cost me?”

I’ve got good news! You have many good choices — it’s just a matter of figuring out the best option for you!

Q. Who can get Medicare?

A. Most people 65 or older who have worked at least 10 years, while paying Social Security taxes, will qualify. Even if you’ve not worked long enough, you can still qualify, if you are the spouse of someone—living or deceased—who has worked long enough.

Persons under age 65 who have received Social Security disability for 24 months also qualify for Medicare.

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No 2010 increase in Social Security

NEW YORK (CNNMoney.com) -- There will be no cost-of-living increase for 57 million Social Security beneficiaries next year because consumer prices have fallen, the Social Security Administration announced on Thursday.
It marks the first time that Social Security benefits have not been increased year over year since the cost-of-living adjustment was put into effect in 1975.
To help counterbalance the hit, President Obama is calling on Congress to send another $250 relief payment to seniors and other Americans to stem the economic strain.
"Even as we seek to bring about recovery, we must act on behalf of those hardest hit by this recession," Obama said in a statement Wednesday. "That is why I am announcing my support for an additional $250 in emergency recovery assistance to seniors, veterans, and people with disabilities to help them make it through these difficult times."

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Posted By: Stephen Barile

Please Spare Me the Extended Warranty

By: Neal Templin

Posted By: SHEA McCABE

Earlier this year, an unwanted caller got hold of my cellphone number.

I would answer, and a computerized recording would warn me that the factory warranty was about to run out on my vehicle, but if I acted now, I could get an extended warranty.

The phone campaign told me one of two things: Either Toyota really cares about me, or selling extended warranties is a very profitable business.

But when I delved into the calls recently, the explanation turned out not to be what I expected.

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Why you should buy health care stocks now

Posted by Jonathan Tse



Health care reform may have their future on hold, but star fund manager Tom Forester says the worst is already built in.

NEW YORK (Fortune) -- With health care stocks cheap compared to the rest of the market, Tom Forester thinks that a bad-case scenario health care bill is already priced into the sector.

"These are emotionally difficult stocks to hold right now because they are in the crosshairs," says the manager of the Forester Value Fund (FVALX). But it's his job to hold onto them. "Value guys are paid to buy stocks that are cheap and have some emotional component in it."

Health care stocks are hurting the fund a bit this year, he says, but last year they helped it become the only diversified stock fund in the U.S. that didn't lose money. Forester also beat the S&P 500 (SPX) by about 40 percentage points, according to Morningstar.

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Your Life, Your Money

By Donald Faison
Provided by PBS videos on pbs.org
Posted by Alma Zhumagulova

Please follow the link to view the video on Personal Financial Planning:
Your Life, Your Money

Employees Face Higher Health Care Costs

By: Eric Gursky

NEW YORK (CNNMoney.com) -- It's open enrollment time at work. Prepare yourself. Starting in 2010, your employer is making sure that when it comes to paying for your health care, you're going to be sharing much more of the burden.

"The headline is greater cost sharing," said Tom Billet, senior consultant with human resources consultancy Watson Wyatt. "That means higher [employee] contributions, higher deductibles, or both," he said.

In 2010, employers are "putting everything on the table," implementing benefit changes aimed at making workers more aware of the actual cost of services," said Paul Fronstin, director of the health research program at the Employee Benefit Research Institute (EBRI), a public policy research group.

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Understanding Diversification

By: Eric Gursky

With a down economy many investors in recent months have learned how valuable it is or was to have a diversified portfolio. Those whose were solely invested in equity or were seduced by the high returns of Bernie Madoff lost most if not all their money in the market. Portfolio diversification is an easy way to reduce the risk of your portfolio by spreading the risk throughout many financial instruments. When diversifying there are many factors that come into play which are different for every investors.
The two main types of diversification are:

Vertical diversification: spreads your money between different types of assets. Cash, government bonds, corporate bonds, property and shares can each be expected to behave slightly differently, and so potentially produce different returns, as circumstances change.

Horizontal diversification: is when you hold different instances of the same asset class. This time you’re trying to reduce localised company or sector-specific risks, particularly with shares.

Once you have figured out which type of diversification you wish to follow you also have to understand time horizon and risk tolerance because they place a critical role into which assets work best.

Time Horizon - Your time horizon is the expected number of months, years, or decades you will be investing to achieve a particular financial goal. An investor with a longer time horizon may feel more comfortable taking on a riskier, or more volatile, investment because he or she can wait out slow economic cycles and the inevitable ups and downs of our markets. By contrast, an investor saving up for a teenager's college education would likely take on less risk because he or she has a shorter time horizon.

Risk Tolerance - Risk tolerance is your ability and willingness to lose some or all of your original investment in exchange for greater potential returns. An aggressive investor, or one with a high-risk tolerance, is more likely to risk losing money in order to get better results. A conservative investor, or one with a low-risk tolerance, tends to favor investments that will preserve his or her original investment.

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College Savings Plan

By Eric Gursky

June 16 (Bloomberg) -- If you are saving for college in a 529 plan, you probably took a bigger hit than you expected during the 2008 market crash.

What should you do now? Keep the plan or dump it?

My opinion: Stay in the 529 world but in a smarter way. These plans, run by the states, can be a great, tax-saving way to put aside money for college. You invest with after-tax dollars but the earnings are tax-free if they are used to pay for higher education.

Thirty-four states and the District of Columbia encourage contributions by giving you credits or deductions on your state tax return. You can buy a 529 from the state, at a low cost. Or buy at a high cost from stockbrokers and financial planners.

Smart idea No. 1: Buy through the state. When you open a 529, you have a wide variety of investment choices. The most popular are the age-based plans. They buy stocks while a child is young and promise to grow more conservative in the years just before college entry. Good age-based funds keep their promise. You have plenty of cash on hand when the tuition comes due.

Irresponsible age-based funds gamble on earning higher returns. They continue to hold a large proportion of stocks and risky bonds, even for 19- and 20-year-olds. These are the funds that get parents into trouble. If you are paying tuition this year, 20 percent or more of your college money might be gone.

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Save Green When You Go Green

Posted By: Shea McCabe

By ANNA PRIOR

You don't need to spend a lot of green to embark on a "greener" lifestyle.

Sure, buying a hybrid car or installing solar panels on the roof of your house are big ways to be more eco-friendly. But you also can make a difference with easy, lower-cost changes, whose savings can add up over time. Here are some steps to consider:

Your Home

The average home is responsible for twice the greenhouse-gas emissions as the average car, says Maria Tikoff Vargas, spokeswoman for the Environmental Protection Agency's Energy Star program. And the average household spends $2,200 a year on energy bills.

"You can save about 30% of that energy use," she says, and make your living space more comfortable by making your home more energy efficient.

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2009 Holiday Shopping Taking a Major Hit

By Eric Gursky
So with the 2009 holiday season quickly approaching stores are beginning to unveil new lines and get ready for what is supposed to be a flourishing time of the year. Think again, with the economy still not in shape, consumer spending and credit are nowhere near the rates of 2007. Many stores are buckling up for what could be a scary roller coaster ride.
For the second year in a row retail sales are expected to fall because of rising unemployment which has curbed gift buying. If sales do decline for the second year in a row it will be the first time this has occurred.

The year-end holiday shopping season is a critical one for retailers, and can account for 25 percent to 40 percent of full-year sales. The 2008 holiday was a disaster for retailers, as a financial crisis swept across the globe in September and consumers cut spending on nearly everything but bare necessities.

Faced with bulging racks of unsold merchandise, many retailers resorted to slashing prices 70 percent to 80 percent last year, undermining both four-quarter sales and profits.

For an industry that severely suffered in 2008 the last thing they would want to hear is that 40 % of the country plans to spend less overall on gifts this holiday season.

Deloitte is expecting total holiday sales to reach $810 billion -- a zero percent change in November to January holiday sales from a year ago. Flat sales numbers would be a good thing in comparison to the 2008 season which experienced a 2.4 percent decline -- the first decline in , holiday sales dating back to 1967, according to Deloitte.

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Choosing a Financial Planner

By Stephen Barile

Many people feel that having a professional manage their finances is the smartest way to manage their money. There are many factors to take into consideration when choosing a financial planner or advisor. First consumers must find out the experience and education level that their potential planner has obtained. There are many certifications and certificates that a planner can obtain to show their qualifications. The CFP license is one of the most highly recognized. To obtain a CFP license a planner must complete courses and tests to prove their knowledge or finance and their competence in handling a client’s money. The consumer must also inquire how the planner is compensated. It is favorable to have a planner that is not making decisions with your money that will earn them a higher commission or salary. After finding a reputable planner it is an essential that the goals of the planner and consumer are in sync. It is also the responsibility of the planner to explain all of the risk and consequences of their decisions. If the consumer finds a reputable planner and lays out a sound financial plan it is possible to achieve all of their financial goals.

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7 Essential Rules to Financial Security

By: Eric Gursky

Old thinking: If you can stomach the ups and downs that come with risk, you'll be rewarded.
New rule: Risk isn't about your stomach. It's about making or missing an important goal.

You know you have to consider risk. But what is risk? Many of us have learned to think of risk as synonymous with volatility. For years, what came down reliably bounced back even higher. You could easily conclude that risk tolerance was just a matter of taste. As long as you had the fortitude to see the occasional loss on your 401(k) statement and not panic, you would capture superior returns over time.

As you now know, the "over time" part of that last sentence is the real risk of relying too heavily on stocks. The longest period of negative returns for U.S. equities is 16 years, according to data collected by Wharton economist Jeremy Siegel. And we're at over a decade as of late February.

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Monster Has Plans to Become 800-Pound Gorilla of Job Ads

Posted by: Shea McCabe

By ROBIN BLUMENTHAL

Amid the worst recession since the 1930s, Monster Worldwide, parent of online job site Monster.com, has been busily investing in its business.

Over the past three years, it has spent more than $200 million to redesign its Web site for job seekers; to purchase ChinaHR.com to boost its presence abroad; and to buy Trovix, a technology company with a vaunted new search tool that should appeal to Monster's key clients: staffing companies and corporate human-resources departments.

At the same time, Monster says it has been cutting costs -- by 25%, or $164 million, in the first half of 2009 alone.

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Buying a Car Gets Pricier as GM, Ford Cut Inventory

Sept. 29 (Bloomberg) -- Buyers who have been waiting for better deals on new cars may be disappointed.

General Motors Co. and Ford Motor Co., bucking decades of tradition, are weaning themselves from dependence on profit- sapping discounts after factory shutdowns curbed dealers’ supply of cars and trucks.

Incentives on GM, Ford and Chrysler Group LLC autos plunged 26 percent to $3,278 in August from a March peak, while discounts industrywide fell 22 percent to $2,474, according to researcher Edmunds.com. The U.S. automakers’ vehicles sold for an average of $2,000 more in the second quarter than a year earlier, said researcher J.D. Power and Associates.

“As we suffered through the worst automotive recession in our lifetimes, the lesson automakers learned was to stay under control and not bloat inventory, which you have to follow with huge incentives to move the metal,” said Jeff Schuster, an analyst at J.D. Power. “From now on, we’re going to see a more cautious approach to incentives.”

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Posted by : Stephen Barile

Bankruptcy Filings Up 22% Compared to Last Year

Posted by: Lisa Matthys

Written by: Christine Dugas

Nevada has replaced Tennessee as the state with the most bankruptcies, as filings continue to stack up nationally.
From January to August, national bankruptcy filings reached 954,911, up from 703,732 in the same period of 2008, according to Automated Access to Court Electronic Records. In August, filings were up 22% compared with August 2008.

It is likely that filings will total 1.45 million this year, says Robert Lawless, professor of law at the University of Illinois.

After the bankruptcy law changed in 2005, filings had slowed.

"But we're now heading back close to where they were before the law was enacted," Lawless says. "It's not surprising, because the 2005 law did nothing to change the underlying economic reality of why people file for bankruptcy."

The 2005 reform aimed to curb bankruptcy abuse and make it harder to erase debts.

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Intuit Acquires Mint.com

Written by: Lisa Matthys

Intuit Inc., known for their tax preparation and financial-management software (Quicken), agreed to purchase Mint.com for $170 million on September 14th, 2009. Launched two years ago, Mint.com is a free online service that allows consumers to track their expenses and investments. The service is able to pull information from users’ checking and savings accounts, investments, loans, and other financial data and compile charts and graphs to show spending habits and trends. Mint.com also hosted advertisements with ways to save on personal finances based on consumers’ individual data. Mint.com had received approximately $17 million in venture funding, with investors such as Shasta Ventures, Benchmark Capital, and First Round Capital. Prior to the acquisition, Mint.com competed with Intuit’s Quicken Online and was growing rapidly with more than 1 million consumers. By buying its competitors (Mint.com, and previously Paycycle in June 2009), Intuit is eliminating potential threats within their competitive environment. With Intuit’s acquisition, Mint.com will be the primary personal finance web site, and Quicken Online will be aimed at customers who use the Quicken desktop software. Financially, the transaction has cut earnings for the year ending in July by 2 cents a share, but Intuit feels that there will be no material effect on earnings in fiscal 2011.

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Green Sherpa a good option for students

Posted By Michael Rivezzo

Green Sherpa is a great option for students especially for freshman that start college. They offer personal finance software that consumers can track,budget, and plan finances and expenses. It also can forecast future cash flow based on past expenses and income.

Most financial planners want students to grab a pen track every expense they spend. But most students are busy with school work and other things that college students do on the weekends. So this software is an important necessity for every college student. The software categorizers all expenses and also alerts students when bills are due.

The software integrates bank accounts and also credit cards so you can combine all your personal finances into one application.One of my favorite applications that Green Sherpa offers is that you can make financial goals such as saving money for a car, and you can track the progress via the website.

The Green Sherpa software is available for a free 14-day trial then is available montly for 7.95 a month

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Students borrow more money then ever fo college

Written By Anne Marie Chaker

Posted By Michael Rivezzo


Students are borrowing dramatically more to pay for college, accelerating a trend that has wide-ranging implications for a generation of young people.

New numbers from the U.S. Department of Education show that federal student-loan disbursements — the total amount borrowed by students and received by schools — in the 2008-09 academic year grew about 25% over the previous year, to $75 billion.

The amount of money students borrow has long been on the rise. But last year far surpassed past increases, which ranged from as low as 1.7% in the 1998-99 school year to almost 17% in 1994-95, according to figures used in President Barack Obama’s proposed 2010 budget.

The sharp growth is “definitely above expectations,” says Robert Shireman, the deputy undersecretary of the Education Department. “But we’re also in an economic situation that nobody predicted.” The eye-opening increase in borrowing is largely due to the dire economic environment, which is causing more people to seek federal loans, he says.

The new numbers highlight how debt has become commonplace in paying for higher education. Today, two-thirds of college students borrow to pay for college, and their average debt load is $23,186 by the time they graduate, according to an analysis of the government’s National Postsecondary Student Aid Study, conducted by financial-aid expert Mark Kantrowitz.

Only a dozen years earlier, according to the study, 58% of students borrowed to pay for college, and the average amount borrowed was $13,172.

The ripple effects for today’s heavily indebted young people are becoming palpable. A growing body of research suggests that tough loan payments are affecting major life decisions by recent graduates, forcing them to put off traditional milestones, from buying a first home even to marriage and having children.

Ironically, the rising levels of borrowing may be contributing to the accelerating cost of college, some college finance experts say. Loans can give colleges an artificial sense of a family’s ability to pay tuition. To some extent, that false sense of security gets built into the assumptions schools make when setting prices, say experts. The idea is that as prices rise, families borrow more and more, spurring prices to rise further, which in turn requires more borrowing.

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Financial Illiteracy is an epidemic in the United States

Posted by: Srividya Srinivasan

Regardless of being formally educated, people still have a difficult time comprehending finances. The lack of financial literacy has been a major issue in the United States lately; financial illiteracy is rampant in the United States. According to Richard Briesch, an associate professor of marketing at the Cox School of Business at Southern Methodist University, a recent study by Harris Interactive found that 57 percent of households do not have a budget, 32 percent do not have any savings and 26 percent admit to not paying all of their bills on time.

The financial crisis that is currently happening now is a strong example of how important financial literacy and how detrimental financial mistakes are. “ ‘If we are thinking we are going to address the lack of financial literacy by informing people at one seminar, let's not even start that discussion. You don't cure pneumonia with an aspirin,’ said Annamaria Lusardi„©, professor of economics at Dartmouth College. Lusardi is editor of Overcoming the Saving Slump: How to Increase the Effectiveness of Financial Education and Saving Programs.” This issue is not a simple fix and more financial education could help increase everyone’s financial knowledge. The U.S. government has a site devoted to providing financial education, and banks and other financial institutions provide free financial education as well. However, the statistics from studies show that these tactics are not effective when taking into account the current state of the world’s finances.

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