Monday, May 31, 2010

Are You Stressed Over Debt

Are you stressed about your debt, you are not alone, so is most of the country. Over 1.3 million people have foreclosed on their homes this year. The unemployment rate remains at 9.9%.

Many people are still struggling to pay their bills while others have given up looking for employment. Others are living on fixed incomes that have not received a yearly increase to match the rising costs of food, housing and other basic necessities.

Americans who once traded in older homes, cars and clothing for updates each year are now forced to take care of their things and hold on to them longer because they simply can't afford to buy anything new.

Before the recession many Americans only lived day to day and didn’t worry about their future. Now many Americans are worried about their future and are struggling to live day to day. Americans are stressed about their homes, their jobs, their cars and other debts that they are unable to pay.

There has also been an increase in the number of judgments filed since the recession. More Americans are being dragged to court to pay delinquent debts that they don't have the money to pay. Hopefully the judges will be easy and setup payment plans that the consumers can afford instead of filing in the creditor's favor.

The recession has forced many Americans to live well below their means and watch their spending by reducing expenses, eating out less, canceling certain luxuries and look for new ways to save money. The good news is that more Americans are saving. According to the Department of Commerce, Americans saved 4.2% of their income last year.

The groups who are the most stressed according to a survey by AP-GfK are: households with income less than $20,000; women; married couples, and Americans aged 30-44. Groups with the least stress are: men, retirees, Americans aged 60 and over, singles, households with income greater than $100,000 and the wealthy.

Friday, May 28, 2010

5 Easy Ways to Save Money While on Summer Vacation

Many of us love to travel during the summer and family vacations usually begin during the Memorial Day holiday. The work load is usually not as high, the kids are out of school, and airline companies compete for your business.

We all need to take time out to relax. The catch is how much will you have to spend to enjoy your summer vacation. Now is a great time to start looking for bargains on airfare, hotels and vacation spots. There are tons of sites available some good ones to use are,, Here are 5 ways to save money when planning for your summer vacation.

1. Comparison Shop. Shop around to find the best deals. Visit websites like,, or to find cheap rates for hotel, airfare and cruises.

2. Don’t wait until the late minute. Plan in advance for vacations especially if you in debt, recently getting out of debt or live paycheck to paycheck. This way you can save enough money to go on vacation without using your credit card to pay for it.

3. Ask others. Talk to friends and neighbors about their current or past vacations and find out how they planned their vacation, i.e. ask about any discounts or sales they know about, inexpensive restaurants, shops, etc.

4. Move fast. When you see or hear about sales or discounts you have to move quickly to capitalize on the deal because they usually don't last long.

5. Reduce spending. Buy traveler's checks, they can quickly be replaced if lost. If you credit card is stolen you may not have another credit card available to purchase any necessities. Buy toiletries and other necessities before traveling. Take one credit card only for emergencies.

Tuesday, May 25, 2010

What You Need to Know About Gift Cards

The CARD Act of 2009 has regulations that affect gifts cards. Starting on August 22, 2010 the CARD Act will require that gift cards have a five year expiration date that must be disclosed to the consumer in advance. These regulations do not apply to prepaid telephone cards and reloadable gift cards.

Gift cards and gift certificates that have not been used can't incur inactivity fees for at least 12 months, and the amount and terms of the fee must be disclosed to the consumer in advance. After a year, only one fee can apply each month. Previously multiple fees were applied each month.

In September 2009, American Express ended its monthly gift card inactivity fee that states that after a year a card that had a balance was charged $2 deduction every month until the balance was zero.

Unfortunately gift cards can still charge upfront fees such as a fee for activity the card which can range from $4.99 - $9.99.

Consumers unfortunately may have to pay higher fees upfront after August 22, 2010 to make up for the revenue companies will lose by not being able to charge inactivity and other fees after the card is purchases.

Saturday, May 22, 2010

How Many Bank Accounts Do You Have

Some experts say less is more and in some cases that is correct but what about bank accounts. Determining how many bank accounts you should have depends on your financial goals: do you want to create an emergency fund, plan for retirement, etc.

You should have at least two bank accounts. If one bank goes out of business or has some type of glitch that prevents you from accessing your money, you will have the other account available. If you have your money in a FDIC insured bank for now you money is insured up to $250,000 temporarily and then the limit will go bank down to $100,000.

Another reason to have more than one account is when traveling, your local bank may not allow you to access money outside of your state so a second account would come in handy. The key is to make sure both accounts operate on separate networks or make sure that at least one account can be accessed nationwide or internationally if you frequently travel overseas.

You can have multiple accounts as long as they remain active and you are disciplined enough to keep track of them. Read your statements each month and verify your balances. If you decide to have a joint bank account verify the balance daily or weekly especially if you spouse does not balance the checkbook or keep receipts. Here are some options you can use to determine how many bank accounts you should have.

How Many Accounts Should You Have
1. Consider location
2. Consider fees
3. What does the bank offers - 24/7 access, after hours customer service, online options, multiple products and services, low or no fees, security protections, multiple locations
4. Watch how they treat their customers
5. Check the bank rating
6. Check the bank's stability
7. Look at future plans (upgrades to service, conversions, future mergers, layoffs, etc.)

You Should Closing Accounts If:
1. You don't know your balance
2. Your account is negative
3. Your balance doesn't grow because of fees you are being charged to keep the account open
4. The interest rate is low or you don't earn any interest
5. You cringe at the thought of going to the bank to make a deposit
6. You forgot you had the account
7. Your original reason for opening the account is no longer valid

Wednesday, May 19, 2010

Is Your Budget Too Tight

A budget is only restrictive if you don't have any extra cash left over after you pay your bills. Stars and athletes have budgets; they hire accountants to keep track of their money so why shouldn't you keep track of yours? 70% of Americans live paycheck to paycheck and 40% of Americans live above their means. This statistic shows there is a serious problem in America.

A budget frees you from stress, worry and anxiety because you know what you have, what you are spending and have the money available to buy the things you need and occasionally the things you want.

A budget helps keep your finances in balance. When your budget is out of balance you use credit cards, go into debt and this can lead to serious financial problems such as foreclosure, bankruptcy, etc. If you know how much money you earn you should also know how much you spend.

How to Develop a Budget
1. Subtract monthly expenses from your monthly income. If the total is negative or less than 5% of your total monthly income that is a red flag that you need to make some major adjustments to your budget.
2. Track daily, weekly or monthly
3. Keep all your receipts and reconcile your bank accounts
4. Use automated software tool, pen and paper or the envelope method
5. Include some wiggle room.
6. Create short and long term goals
7. Use money left over in budget to create a savings account and pay down debt

How Budgets Can Prepare You for Future Events
1. Is your financial roadmap
2. Helps to deal with unexpected expenses
3. If you work every year and don't have money to take a vacation or get your car repaired or buy a needed pair of shoes because the one you have squeeze when you walk, or don't have enough money to buy health insurance then you need a budget.
4. What you do today will affect your future
5. Can help you plan for the future
6. Frees up cash to achieve financial goals: plan for vacations, home renovations, your children's college education, and plan for retirement

Benefits of a Budget
1. Prevents you from spending more than you have
2. Reduce usage of credit cards
3. Reduces fees (bounced checks, overdraft, over-the-limit, late fee, etc.)
4. Prevents arguments with your spouse or significant other and helps reduce blame
5. Helps you save money when making purchases because you don't have to worry about credit card interest and finance charges
6. Prevents harassing calls from creditors
7. A budget is needed even if you pay your bills on time. The best athletes have personal trainers and coaches to help them remember the best, so if you want to get better with your finances start a budget

Sunday, May 16, 2010

7 Financial Tips for Recent College Grads

Congratulations! You graduated from college and received your degree. Now what? You now have to face reality and face the real world. First, get a job. Next, figure out what to do with your money but don't spend it all. Forty-percent of Americans live paycheck to paycheck and seventy percent of Americans live above their means. It can be tempting to buy everything you want and spend your money on everything you see but slow down and pace yourself. Here are 6 tips to help you live below your means and stay out of debt.

1. Pay with cash. Pay for purchases with cash until your credit card balances are paid in full. If you pay for an item with a credit card you end up paying 112% the original cost of the item.

2. Setup a debt payoff plan. Setup a debt payoff plan to prioritize your bills including student loans and credit card debt. Start by paying off the smallest bills first, then use the money paid towards a previous bill and apply it to the next bill and continue this process until all your debts are paid.

3. Pay more. If pay the minimum monthly payment you will end up paying 2 to 3 times what you actually charged due to the interest and finance charges that accrue on your balance. Try to send extra towards your balance each month.

4. Retirement. Start with your company's 401K as soon as you are hired for your first job. Do research to see what plan has the best options to help you achieve your retirement goals.

5. Diversify. Control your risks by investing in various mutual funds that are a combination or low, medium and high risk to limit your losses.

6. Buy insurance. Buy health, life and disability insurance. Many Americans go into debt due to medical bills and lack of insurance. Get at least basic health, life and disability coverage. Coverage is cheaper for individuals.

7. Student Loans. Start now paying back student loans. The longer you wait to pay them back the more interest accrues on your balance. Consider using student loan forgiveness programs at

Thursday, May 13, 2010

Mortgage Lenders Get Punished

Today the Senate voted to ban mortgage lenders and loan officers from received higher pay for offering higher interest rates on loans, and will require that borrowers prove they can repay their loans as part of the overhaul of financial regulations to prevent the collapse of Wall Street and the housing market in 2008. The Senate also voted to let the Federal Reserve retain supervision of smaller banks.

The bill would place restrictions on how mortgage lenders and loan officers get compensated because consumers were encouraged to obtain higher interest rate mortgages that they were unable to pay, resulting in record numbers of foreclosures.

The bill would require borrowers to provide proof of their income by showing tax returns, payroll receipts or bank documents and would eliminate the "no-doc" or "low-doc" loans that were previously offered that did not require proof of income.

Another industry that needs an overhaul is the auto industry repeatedly take advantage of consumers by inflating rates and inserting hidden fees and displaying deceptive ads.

Monday, May 10, 2010

Healthcare Reform and Small Businesses

The Healthcare reform has provisions for Americans as well as businesses. The Healthcare reform affects small businesses that have fewer than 100 employees but depends on state guidelines.

Tax credits are available to small companies depending on the size of the company. The largest tax credits are available for small businesses for that have 10 employees or less. Companies with 50 employees or more will not receive any tax credits. Companies who provide their employees with high cost insurance plans that is defined by the cost of the insurance premiums instead of what the insurance plan covers will be taxed at 40% beginning in 2014. Subscribers of these plans usually have excellent health coverage and low deductibles.

Starting in 2010 small businesses will receive a 35% tax credit if they have 10 employees or less that earn $25,000 a year. Small businesses that have 25 or less employees than earn $50,000 a year or less are eligible for a smaller tax credit. Employees who earn $80,000 or more per year are excluded from the tax credit.

Beginning in 2014, all states must setup health insurance pools called Small Business Health Options Programs (SHOP) which will allow small businesses to pool together to buy health insurance. Participating in this program will allow small businesses to receive a 50% tax credit if you have 10 or less employees who earn less than $25,000 a year. If you have 50 or more employees and do not provide health insurance you will be fined $750 per full-time employee but you will not be charged for the first 30 workers that you don't provide health insurance for. You will also be fined if you don't cover at least 60% of employee health costs.

Small companies that pay more than $10,200 per year for individual employee’s health coverage, or more than $27,500 for family health coverage will be charged a 40% excise tax on the portion of money paid that exceeds the individual or family amounts.

If you offer your employees health insurance you are required to cover no less than 72.5% of the cheapest health insurance plan for individuals, and no less than 65% of the cheapest plan for families. You will be required to automatically enroll every employee in a health plan with the lowest employee premium, unless they opt out.

If you decide not to provide health coverage to your employees you will be required to pay the Health Choices Commissioner 8% of the average wages paid during a predetermined enrollment period and you may be charged a lower percentage if your annual payroll is less than $400,000.

If you provide health insurance to your employees and don't pay the SHOP fee or if you try to entice a sick employee away from the company-provided health insurance towards the SHOP to save money you will be fined $100 per violation per day.

Friday, May 07, 2010

Bad Credit and Dating

Credit affects many aspects of your life include dating. If you have poor credit because you lost your job or home to foreclosure women will be more forgiving and understanding. However, some women may not be interested in dating a man who doesn't pay their bills or wants to wait 7 years for old debts to fall off their credit report instead of paying the debt.

Many women are more concerned with the character of a man instead of his material possessions and it is very appealing for a woman to meet a man with an average or good credit score because it states a lot about his character: you are aware that credit affects several aspects of your life, you are accountable and responsible with your money and pay your bills on time, you may have made mistakes in the past but have learned from your mistakes, and you continually work to ensure that you maintain and/or improve your credit score.

Some women don't date men with bad credit. If you have bad credit and are dating it is best to be upfront with women. Women want to be with a man who is responsible and accountable for his actions.

Women like a man who has a plan and knows how to solve problems and women examine how a man is solving his own problems. If a woman knows that you have bad credit and you are not doing anything to fix it you may not be considered for a possible date or a potential mate.

If you are dating and have poor credit it will force you to be accountable for your actions. Here are some tips to help you:

1) Think of creative ways to increase your income since many employers are using credit as a means to hire candidates.
2) Purchase items with cash (but if you don't manage your money properly and overdraw your account it will lower your credit score).
3) Develop better money management skills to ensure that you live below your means.
4) Examine why you have and/or continue to have poor credit.
5) Be creative when dating because if you don't have a lot of cash or credit you won't be able to go to the usual places like dinner and movies, trips, etc.
6) Learn how to appreciate the simple things in life.

Tuesday, May 04, 2010

Personal Finance Tips for Stay at Home Moms

With the recession many mothers have been forced or decided to stay home to reduce expenses and take care of their families. One thing that is crucial to the financial stability of stay at home moms is personal finance. Women can't depend on their spouses income during retirement.

As a stay at home mom you must have your own retirement account and finances to ensure you have a secure financial future. Here are some tips on how to prepare for your financial future.

Spending Plan
1. Create a spending plan and stick to it.

2. Collect change and put in a water bottle. Every 3 months take the money to the bank and deposit into a savings account.

3. Any additional money saved or earned (yard sale, coupons, etc.) can be deposited into a retirement account.

4. Sell new or used goods on eBay.

5. Save at least 3 to 6 months worth of expenses in an emergency fund.

Saving for Retirement
1. Consider getting a spousal IRA. A stay at home mom in 2010 can contribute up to $5,000 a year towards an IRA but this gets phased out for couples with adjusted gross income between $167,000 and $177,000.

2. Don't depend on your husband's retirement income to cover both of you during retirement. Each person needs at least 80% of their salary during retirement so if you are a stay at home mom, your husband's 80% salary will have to cover both of you and that money will be depleted very quickly even if you live a simple life.

Life Insurance
1. Determine how much money you would need to cover child care costs, housekeeping, car repairs, cooking, cleaning, school expenses for children, grocery shopping, etc.

2. Term life insurance is the cheapest type of insurance for a stay at home mom.

3. Determine how long you want a fixed rate: 10, 20 or 30 years.

4. Determine how long you want insurance: until your kids reach high school age, etc.

5. Comparison shop to find the best rates.

6. If you are unable to pay for a life insurance premium look for ways to reduce expenses and consider getting a part-time job.

1. Who will take care of my children?

2. How do I want my children taken care of?

3. Do I have any assets, if so, who will receive them?

4. Do I want my children to have an inheritance? If so, how do I want my children to spend their inheritance?

Saturday, May 01, 2010

How I Saved $415 in One Day

Although we are still feeling the effects of the recession there are many ways you can still save money. My contract with my cell phone carrier had expired in April 2010 and I knew I was eligible for an upgrade.

I searched the carrier website and found the phone I wanted. I was going to order the phone online and wait for it to arrive in the mail but decided to wait a few days.

The cell phone I selected cost $399 and had tons of bells and whistles that my current phone did not have. I could not watch videos; upload presentations, and views documents in .pdf, Word and Excel. I just happened to be in an electronics store and was looking at their cell phones and noticed that they had the same cell phone I wanted to purchase.

The sales clerk asked me if I was interested in any of their cell phones and I pointed to the one I wanted but quickly told him that I could get the cell phone for free on my carrier's website instead of paying the $15 store price. The sales clerk told me to wait and they could match the price.

I logged on to my account and showed the salesclerk the phone I wanted and the price for upgrade which was "zero". He quickly selected my phone, switched over all my data and sold me a cover for my new phone, all for under $40. The $40 included a cover for my new phone $29.99 and the $9.99 per month insurance coverage. Needless to say I was excited about saving $400.

Keep in mind that my previous phone kept freezing up and I had several problems with it during the past year. I continually called my cell phone carrier and they suggested buying a new phone or wait until I was eligible for an upgrade. At one point they mailed me a new battery after threatening to go with a competitor cell phone carrier and reminding them that I had two cell phones with them, one for personal and one for business.

I was not happy with their response so I toughed it out with my phone freezing up, having to take the battery out to stop the phone from freezing, having the ball scroll all over the place, having a hard time deleting or selecting items. My thoughts about that will appear in another blog. But all that suffering paid off and now I have a new Blackberry which I love. Miracles do still happen.