Sunday, October 31, 2010

Beware of Credit and Debit Card Scams

I was a victim of identity theft on my business debit card. Two fraudulent charges were made on my business account - both were under $10. How often have you seen charges that range from $2-$10 and for a second you wondered what the charge was but ignored it. Well I did just that.

The first charge I saw I assumed it was correct but I saw a similar charge two months later around the same amount of the first charge. I never bought anything from the company. I looked at all my receipts and bank statements. I researched the company. I called and let a voicemail message and never got a call back. The automated message stated they were busy helping other customers and to leave a message. I further researched the company phone number and other customers had been victims of fraud by the same company. It was a bogus company. I had been scammed.

I contacted my bank and told them of the fraud. They immediately placed an alert on my account and after 2 business days the charges were credited back to my account which totaled $18.98. If I never investigated these charges, the charges could have continued for years. My business account is with one of the largest banks in the country. I am going to open a new business account with another bank tomorrow.

The FTC has been cracking down on debit card scams. The FTC is investigating an international micropayment scam that stole almost $10 million from customers' credit and debit cards. Over 1 million credit cards were used to make fraudulent charges. Most of the charges were not disputed. The FTC closed down phony merchant accounts used by the scammers.

The charges were not detected by bank antifraud software. Some customers didn't bother to dispute the low charges. The identity thieves charges approximately $9.5 million over a 4-year period of four year starting in 2006. Here are 6 ways to protect your personal and business credit and debit cards from fraud.

1. Go with your gut feeling. Don't doubt yourself.

2. Don't give out your checking account number, tax id, personal or business credit card number over the phone unless you know the company and understand why the information is necessary.

3. If someone says they are taping your call, ask why. Don't be afraid to ask questions.

4. Companies do not ask for your bank account information unless you have expressly agreed to this payment method.

5. Do business with reputable companies. Be sure the company website has a physical address that is verifiable and a phone number that is answered by a live person. Verify the company phone number in the Verizon online yellow pages or do an internet search on the phone number.

6. Report the fraud to the FTC at by filling out an identity theft complaint form.

Thursday, October 28, 2010

Halloween Mania and Money

Halloween is celebrated by many Americans in the United States. Is Halloween really a holiday? We don't get a day off work to celebrate it but it is treated as a holiday and it seems as though some people get more excited about Halloween than Christmas. I wonder if the people who dress up at Halloween also dress up as Santa or Mrs. Claus at Christmas or dress up at Thanksgiving.

Companies make millions of dollars in sales during Halloween. Disney theme parks had a 40% increase in attendance at Disneyland in LA. In 2009, companies made approximately 6 billion dollars in Halloween sales.

If Americans took the money they plan on spending this year for Halloween and put it towards paying down their debt or put it in an emergency fund they would be in a better financial position next year. If you are going to celebrate Halloween this year here are 5 ways to save money.

1. Costumes. Buy costumes from the dollar store or make you own. Dress up like a cartoon character or a TV show character.
2. Candy. Buy candy from the dollar store or at discount or wholesale stores like Costco, BJ's or Price Club. You can also use coupons at store that double the coupon value.
3. Family Outings. Carpool, buy bulk tickets or ask about discounts for families or large parties to save money on admission fees for haunted houses or other activities.
4. Host a party. Host your own Halloween party and ask guests to bring a dish. This way you save money by not going out and get the luxury of staying at home.
5. Skip Halloween. Skip Halloween and do something that is low cost or free like attending church, visiting family or plan a family night and watch TV. This will save you a lot of money and will bring your family closer together.

Tuesday, October 26, 2010

Retirement and You

Last week was designated as National Savings Retirement Week to help bring awareness to the need to plan for retirement. Many Americans still do not save enough for retirement and some do understand the importance of saving for retirement.

According to a 2009 EBRI a study of employees: 43% of workers said they have less than $10,000 in savings, while 27% of workers said they had less than $1,000. According to the FDIC: 97% of Americans will be dependent to some degree on family, friends or the government in retirement; a 65 year-old couple retiring today has a 63% chance that one of them will live to 90 years old; a 65 year-old couple retiring today will need approximately $240,000 to cover just medical expenses even with Medicare assistance.

You will need at least 60-70% of your salary during retirement. You should plan to save enough in your retirement account to cover living expenses for at least 20 years. Here is a retirement checklist to use when saving for retirement.

1. Do you have a retirement account?
2. Have you contacted a professional to map out your retirement plan and goals?
3. Do you know your retirement account balance?
4. Do you check your quarterly retirement statement?
5. Is your retirement portfolio diversified?
6. Do you know where you will live, what age you want to retire and the lifestyle you want to live during retirement?
7. Have you determined what costly expenses you will need during retirement (healthcare, prescriptions, etc.)?
8. Have you created an estimated budget for retirement?
9. Will you have enough life, health, disability and long-term care insurance?
10. Do you plan to pay off your mortgage and any other large debts prior to retirement? If not, how do you plan to pay for those expenses?
11. Do you want to be fully retired or work part-time?
12. Will you be eligible for social security when you retire?
13. Is your beneficiary information is up-to-date?

Here are 6 ways to help you prepare for retirement and increase your retirement savings.

a) Don't panic. Don’t make decisions based on emotions or get overwhelmed by the media, fear, anxiety and nervousness of those around you. Stay calm and follow the plan you have setup with your financial planner. Don't torture yourself by checking the stock market everyday or checking your retirement account balance every week or every month.

b) Review. Review your financial goals with your financial planner at least once a year to ensure you are on track to meet your goals. Also, check your statement for any errors and notify your financial planner immediately.

c) Time. Your money cannot grow if you take it out too soon. It takes a minimum of 7 years to see a significant return on your investment so leave your money in your account.

d) Diversify. If you have all of your investment in one area, re-allocate your investments to at least 3 areas to minimize losses.

e)DRIPs. To offset any losses you may have experienced you can purchase a Dividend Reinvestment Plan (DRIP) or use it as an easy way to start investing.

f) Buy now. The motto is "buy low, sell high" is very appropriate during a recession. This is a great time to buy stocks or to invest in a mutual fund. When the market bounces back you will have achieved great gains.

Friday, October 22, 2010

Are You Financially Literate

According to the Federal Reserve, 43% of Americans live above their means. Many Americans live paycheck to paycheck and are living in either low-income or middle income households – some just one paycheck away from being homeless. If they lose their jobs, they have no backup plan, no savings and no safety net to help them through a financial crisis. Some school systems do not teach financial literacy because they don't feel it is a priority.

Unfortunately, students who are not financially literate grow up to be adults who are not financially literate. These same adults develop bad spending habits, have bad credit and file for bankruptcy or foreclosure. If financial literacy was taught in all the school systems in the country, many Americans would be in a better financial position because they would be empowered with knowledge to help them make good financial decisions and they would have the tools to recover from a financial crisis.

Here are some questions that will help you determine if you are financially literate. If you answer "no" to 5 or more questions, you may need to gain some knowledge about financial literacy and change your thoughts about money.

1. Do you have a bank account?
2. Do you frequently overdraw your bank account?
3. Do you have an emergency fund? Do you have at least 9-12 months of savings in an emergency fund?
4. Do you cash your checks at a check cashing store or liquor store?
5. Do you pay bills late?
6. Do you have a retirement account or do you invest?
7. Do you know what your current credit score is?
8. Do you write all ATM/debit card transactions in your check book?
9. Do you regularly compare your bank statement with your receipts?
10. Do you have a budget?
11. Do you know how much debt you owe?
12. Do you know your net worth?
13. Do you owe taxes or have you owed taxes in the past?

If you are not financially literate and don't the basic about personal finance I encourage you to read self-help books on personal finance that discuss budgeting, investing, retirement, saving, paying for college and taxes. There are also several websites available such as CNN Money, Yahoo Finance,, MSN Money and The more you know the more you grow. Money can generate wealth or generate debt, you make the choice.

Wednesday, October 20, 2010

Financial Survivor or Victim

Many Americans have experienced financial, family or physical tragedies over the past few years. Their financial outlook has gotten worse because of the recession. This has caused many Americans to give up, lose hope, lose faith and become confused, lost, afraid, stressed, anxious, angry and resentful.

These feelings can cause one to make poor decisions and choices in their lives. The first key to dealing with these emotions is to acknowledge them. Once you acknowledge your feelings don’t allow your feelings to control you. Next, think about what you can do to overcome your current situation and find a solution. You can’t change what happened but you can change how you react to it and how you deal with it. To do this you determine if your behavior is that of a survivor or a victim.

A victim:
1. Makes excuses
2. Looks for handouts
3. Waits for someone to help them
4. Doesn’t take responsibility for their actions
5. Doesn’t seek professional help
6. Refuses to change their current situation
7. Doesn’t accept reality
8. Is unable to implement a solution
9. Stays in a spiraling state of emotion (stress, frustration, anxiety, etc.)
10. Doesn’t have a plan of action
11. Unable to recover from a crisis

A survivor
1. Doesn’t make excuses
2. Develops a plan to solve problems on their own
3. Seeks professional help
4. Lives in reality - accepts the current situation but remains focused on future goals
5. Takes responsibility for their actions
6. Doesn’t wait for someone to help them
7. Uses emotional intelligence to manage feelings (
8. Uses resources such as self-help books, educational television shows, law of attraction, etc.
9. Survived previous crises and learned from the experience

Here are 8 steps to overcome a financial crisis.
1. Focus on how to solve the problem rather than focusing on the problem
2. Spend money without feeling guilty – you feel guilty because you are not living below your means
3. Use cash vs. credit to save you money
4. Have faith that your financial situation will improve – law of attraction
5. Pay off credit cards at the end of each month to avoid paying interest and finance charges
6. Have a savings account, checking account and retirement account which helps you plan for the future
7. Have at least 6-12 months worth of savings in an emergency fund to help with unexpected expenses or a financial crisis

To become a survivor of any financial crisis you have to change your mindset. “If you do not attract what you want to be, you will be what you are, forever” by Ankur Sancheti.

Saturday, October 16, 2010

Do Your Thoughts Keep You Poor

Today's post is taken from Burt Goldman creator of the Prosperity Paradox. I thought it would provide another perspective to financial success. Enjoy!

The longer you spend doing something, the better you will become at it. That is the Law of Life.

To become an expert at whatever it is you want to do, you know that if you put in the time and dedication, you'll eventually get there. After all, practice makes perfect, right?

This rings true for almost anything in life and most professionals in any field will tell you that following this Law has gotten them to where they are today.

In Sports - During his high school years, Michael Jordan never made the school basketball team but after years and years of dedication and practice, he became the all-star he is today.

In Arts - Heath Ledger took months to study and absorb his character, the Joker, in 'The Dark Knight' and actress Winona Ryder had to dive into the psychology of disturbed women for months before starring in 'Girl Interrupted'.

In Music - The Beatles were no strangers to practice. In the earlier days of their career, they played 8 hour sessions, every night of the week without fail. Well, we all know how successful they became.

There are an endless number of fields where world-class experts will tell you the same thing. Dedication, motivation and hours of practice will make you better at anything you take on. It's common sense, right?

It is the proven formula for most things... but here lies the problem... this does not apply to making money.

The Prosperity Paradox

We spend the majority of our lives trying to make good money. Do the math - say you have already spent 20 years dedicating the majority of your time and effort into making money. At 40 hours a week, that's over 40,000 hours spent making money!

After that much time, you should already be a master at it!

Think about what your golf handicap would be if you spent that amount of time on the driving range! But the truth is, most of you will continue breaking your backs for the rest of your lives and still not get any better at making money. Why?

Money is the only thing you will not get better at with time. This is what I call the Prosperity Paradox and it exists because of the 3 great lies we tell ourselves about money.

The 3 Great Lies

1) Money = Career
Most often we think that our career path will determine how much money we will make. A lawyer, accountant and a clerk will have certain expected pay grades. We believe our chosen career always has a salary cap. But this type of thinking limits our potential to make money. The truth is that you can reach financial success regardless of your monthly paycheck.

2) Money = The Value You Give The World
You make money only by giving value to the world. This is a myth. Think about jobs that benefit no one but themselves. Casino kings, drug lords, people who cheat others of their hard earned money. All these add no value to the world. Yet, these people are living the life honest folks deserve. Then think about those who have given so much value to the world. Teachers, nurses, even garbage collectors are not anywhere close to being millionaires. So how can this statement be true?

3)Money = Hard Work
The advice from our parents "You have to work hard for your money" no longer rings true. Money does not equal hard work. Most people slog all day and night, they take on two or three jobs, eat from their desks, ruin their health, suffer from stress, and yet they are no closer to financial freedom than before.

These 3 lies are created by YOU, by society and by your misconceptions about money. In fact, money doesn't relate to any of these things! The only thing your financial success relates to is your... Prosperity Blueprint.

The Prosperity Blueprint and Your Money Mindset

Or, in other words, your money mindset. Here's a scary fact... Right now, your Prosperity Blueprint has been preconditioned to never help you get any better at making money. But it's NOT your fault! You have been misled along with millions of other hardworking people who will never escape this money making struggle. Let me tell you how it happened.

1)You were never trained on HOW to make money
It is a sad but true fact. You were never trained on how to make money. There are no classes in schools or Universities that tell you what you need to do to become a professional moneymaker. You were simply trained with the skills that would hopefully make you some money one day. You make money as a result of THAT skill.

2) You are BRAINWASHED by society
You were conditioned to have certain limited and stereotypical beliefs about money. Here are a few phrases that I am sure you have heard before whether you believe them or not: "Money is the root of all evil" "It's more enlightened to be poor than rich" "If I get rich, everyone will want something from me"

In fact, even some very famous people have cautioned us against money:

"I do not like money, money is the reason we fight." --Karl Marx
"Love and money should properly have nothing to do with each other." --John Saul, Guardian
"Surely there never was so evil a thing as money, which maketh cities into ruinous heaps, and banisheth men from their houses, and turneth their thoughts from good unto evil." --Sophocles, Antigone

3) You are influenced by BIPOLARITY within society
There are many subsections within the society: The rich and the poor. The educated and the uneducated. The urban and rural. The democrats and the republicans. These splits within our society have fortified the limitations in our self-belief system about making money, "People like us will never be rich." "People like them have it so good." These conditionings have limited your potential to make money. This is a very BIG problem.

But here is good news... Unlike the millions of others who do not know any better, you have read this and are aware of this Prosperity Paradox. And here is more good news. There is a very SIMPLE SOLUTION and that is to... Reset Your Prosperity Blueprint.

Only 5% of people have figured out how to do this and they are enjoying financial success in a way that many can only dream of. And what about the other 95%?

Because of the lies they believe in, they will always be stuck trying to make money. Now that you know the truth, will you be part of the successful minority or the striving majority?

Wednesday, October 13, 2010

Open Enrollment Tips

The health care reform will affect health benefits for most Americans. Most of the changes will occur in 2011. For those currently employed, you can make changes now during your employers Open Enrollment.

Verify all of your health information is accurate. If you have benefits that will no longer be paid in 2011, ask your health plan provider if you can pay for the services using a Flexible Spending Account. Some highlights of the health care changes are:
1. Children up to age 26 can be added to their parent's health insurance plans and be considered qualified dependents for a Flexible Spending Account or Health Savings Account.

2. Starting in September 2010, some preventative services willl be available to health insurance customers at no additional cost.

3. Starting on January 1, 2011, a doctor's prescription is required to receive reimbursement from a Flexible Spending Account or Health Savings Account for over-the-counter medications and drug purchases. You will also be charged a penalty up to 20% of the total withdrawal if you withdraw from your Health Savings Account for non-medical expenses.

4. During Open Enrollment you should also sign up for vision, dental and life insurance benefits. Know th difference between Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPO), and Point-of-Service (POS) plans.

5. Comparison shop during Open Enrollment season and consider the cost of the plan including but not limited to: the monthly cost of each plan, deductibles, services provided and prescriptions costs. Coverage is also based on what you can afford and what is best for your family.

Employees and health insurnce providers must communicate about the different options that are available to an employee.

Sunday, October 10, 2010

Medical Bankruptcy

The Medical Bankruptcy Fairness Act of 2009 is a bill that would amend title 11 of the United States Bankruptcy Code (Bankruptcy Abuse Prevention and Consumer Protection Act of 2005) would: 1) provide protection for homeowners with medical debt, 2) restore bankruptcy protection for individuals experiencing financial distress who serve as caregivers to injured, ill, or disabled family members, 3) and to become exempt from taking the bankruptcy means test for those whose financial problems were caused by serious medical issues.

If the bill is passed it would waive the “means test” and credit counseling requirements for those who to wish file bankruptcy.

A recent study shows that based on the effects of the recession approximately seven million Americans will lose their health insurance coverage. Employee spending on health insurance coverage has increased 128% between 1999 and 2008.

Economists have found that increasing health care costs show a connection with decreases in health insurance coverage. National studies show that the main reason many people are uninsured is due to the high costs of health insurance.

The United States is the only developed country that provides health insurance but has the largest number of deaths due to lack of medical insurance or lack of appropriate medical care.

Contact your loss congressman to have the bill passed to provide additional protection for Americans and their medical costs.

Thursday, October 07, 2010

Extra Money for Verizon Wireless Customers

If you are a Verizon Wireless customer you may be getting a refund. Verizon Wireless has been ordered by the Federal Communications Commission (FCC) to pay up to $90 million in refunds to cell phone customers who were changed for internet access or data usage over the past few years.

Last year the FCC asked Verizon Wireless about the $1.99 a megabyte access fee that appeared on bills of cell phone customers who didn't have a data plan but accidentally initiated data or internet access by pressing a button on their cell phones.

The issue affects approximately 15 million customers who will receive credits between $2 - $6 on their October or November cell phone bills. Customers who are no longer Verizon Wireless customers will receive refund checks.

Verizon stated that it no longer charges fees when a customer accesses data services but shuts it off quickly.

If you were affected by this, check your statement. If you have not received a credit on your October or November bill, contact Verizon Wireless to find out the reason.

Monday, October 04, 2010

Help for Bank of America Customers

As of August 2010 over 2 million homes are listed as foreclosed which shows there is still a great need for mortgage companies to work with homeowners to help them stay in their homes. Bank of America has decided to delay foreclosing on homes in 23 states while the company determines if they rushed too soon to foreclosure on some homes.

The states affected are: Connecticut, Delaware, Florida, Hawaii, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Nebraska, New Jersey, New Mexico, New York, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Vermont and Wisconsin.

In some cases employees signed foreclosure documents without verifying the information. GMAC and JPMorgan Chase have also made the same mistake. This issue may lead to lawsuits due to homeowners contesting foreclosures that may not be valid. Pressure is being added to mortgage industry professionals by state attorney generals who are working hard to enforce foreclosure laws.

In some states, mortgage lenders can foreclose quickly on delinquent homeowners. Freddie Mac and Fannie Mae and Freddie Mac stated that they are informing mortgage companies to follow proper procedures.

It is uncertain how this decision will affect homeowners. If you are a Bank of America mortgage customer call the company at the 800 number provided on your mortgage statement to get information about your foreclosure or pending foreclosure.

In the future, go with your gut if you feel you have not been treated fairly by your mortgage company or you feel that proper procedures have not been followed. You can also contact HUD or a certified housing counselor to get a second opinion on any housing paperwork or issues that you are concerned about or have questions about. You can also file a complaint against your mortgage company with the Federal Trade Commission, Better Business Bureau or your state attorney general's office. If you have a FHA mortgage loan you can file a complaint with HUD.

Friday, October 01, 2010

Think Twice Before Shopping This Holiday Season

Most Americans spend the greatest amount of money and go into debt during the December holiday season. This year get a jumpstart on holiday shopping and start shopping in October. When shopping for gifts during the holidays, many shoppers are filled with anxiety, pressure or guilt about spending money during the holidays.

If you don't have the money to buy gifts be honest with yourself first, then with your family and friends. The holidays about not about spending money, they are about spending time with family and friends. If you have a small amount of buy to buy gifts buy what you can and don't use your credit card to buy gifts unless you have the money to pay the debt off in two or three months.

Here are some reasons why you shouldn't spend money this holiday: 1) you owe more than $5,000 in debt, 2) you are not a homeowner, 3) you do not have a savings account, 4) you do not have a retirement account or have a low balance, 5) you owe more on your home or car than what it is worth, 6) you have bad credit, 7) you are considering filing for bankruptcy or foreclosure, 8) you live with your parents.

Here are 5 ways to help you save money during holiday shopping.
1. Visit the local dollar store to find gifts for children.

2. Visit local vendors, you can probably negotiate a good deal on the same items you find in the department stores.

3. Think of creative gifts to give that you can make yourself.

4. If you have to buy gifts for several family members try doing a "secret Santa" or "grab bag" so only one family member has to buy a gift for one family member and set a limit on the amount spent. That way everyone gets a gift and you don't have to worry about buying several gifts.

5. Shop online, some companies waive shipping and handling fees during the holiday season.