Christmas Shopping Survey

Please answer the following questions below to participate in a financial survey. The responses will remain anonymous and the results will be posted on my blog. If you would like to participate send your responses to feedback@hefreemanenterprises.com. Please submit your responses no later than January 10, 2009.


1. Did you buy Christmas gifts this year? If yes, go to question 2 if no skip 5
2. Did you scale back your Christmas shopping this year because of the recession?
3. Did you buy gifts with cash or credit?
4. Do you have the money to pay the credit card bill when it arrives in January 2009?
5. Are you currently in debt?
6. Do you have a different outlook on your finances this year because of the recession?
7. Have you made a plan to improve your financial situation next year?
8. If you purchased Christmas gifts this year do you have one or more of the following: 1) savings account, 2) 401K with your employer, 3) IRA, 4) stocks

Christmas Wasn’t The Same This Year

Due to the recession, increasing food prices, previous increase in gas prices, continuing company layoffs, 4.39 million unemployed, 46 million uninsured and thousands more are homeless or at risk of experiencing a financial crisis many American cut back. Today I am happy to know that someone finally woke up. Some Americans actually cut back their Christmas shopping and faced reality. Some Americans were smart this year and didn’t spend money they didn’t have on Christmas gifts.

According to SpendingPulse, the 2008 Christmas shopping season was the worst it has been in decades. The shopping season was tracked from the day after Thanksgiving until Christmas Eve. The Christmas shopping season accounts for approximately 40-50% of retailer’s annual revenue. Sales at specialty clothing stores such as Gap and Old Navy fell 19.7%. Sales at electronics stores such as Best Buy fell 26.7%. Sales at high end department stores, jewelry stores and restaurants fell 34.5%. Online sales fell 2.3%.

This is the start of a new day. If you are feeling the sting of the recession you need to make a plan for how to survive in 2009. Experts indicate that the recession will continue through 2009 and possibly into 2010 so you need to make sure that you are able to survive and reduce your chances of losing your home to foreclosure, filing bankruptcy, having repossession or some other financial crisis. Make your plan today before it’s too late.

Keep Saving Your Pennies

The number of Americans currently unemployed has reached 4.39 million. This number is staggering and reminds Americans that now more than ever you need to have a Plan B.

No one knows what tomorrow holds so if you haven't already start savings your pennies, quarters, dollars, and more. Use coupons, only buy necessity items.

More layoffs are expected in the new few months. Bancorp will cut 1,000 jobs, Textron will cut 2,200 jobs and Unisys Corp will cut 1,300 jobs. That is an additional 4,500 Americans who will become unemployed.

You can no longer buy luxury items because you don't know if you will still have a job to pay for it. You must live within your means and that is going to hurt and hurt big but as your grandparents and parents used to say, it is better to be safe than be sorry.

Beware of Pick a Pay Loans

The next wave of loans due to reset in 2010 are the “Pick a Pay” Mortgage loans. The “Pick a Pay” mortgage loans are where homeowners can choose to pay less than the full monthly mortgage payment and the difference is added on as principal.

When the loan is reset in 5 or 10 years the homeowner is locked into a higher monthly mortgage payment. This may cause a higher increase in foreclosures or bankruptcy filing because homeowners will be unable to make their mortgage payments. Many banks and financial institutions offered this loan such as Wachovia, Golden West, Countrywide, Washington Mutual, First Federal Financial Corp, and Platinum Capital Group.

However, this type of loan neglected to tell homeowners that they could risk having negative amortization and could even up owning more on their home than it is worth because the loan principal would increase between 110 to 125% of the original loan amount when the loan resets.

Mortgage loan officers are worried that is may be harder to help homeowners modify their loans because there will be a large difference in their current mortgage payment and the new mortgage payment when the loan resets.

If you are currently a homeowner and do not have a fixed interest rate that remains the same over the life of the loan please read your mortgage loan agreement and contact your mortgage company to modify your loan to get a fixed interest rate. Contact a hud counselor hud.gov/offices/hsg/sfh/hcc/hcs.cfm or call Hope Now at 888-995-4673 to get help.

Great Last Minute Holiday Gift

If you need a great last minute gift for a friend, relative or co-worker, purchase remaining copies of my self-help book, How to Get Out of Debt: Get "A" Credit Rating for Free for $7 with free shipping anywhere in the United States.

The regular retail price is $19.95 available at Borders, Barnes & Noble, Walden Books and B. Dalton. This sale price is available until all remaining inventory is sold.

This self-help book provides step-by-step information on how to repair your credit, create a flexible spending plan, and how to get out of debt.

The book also has sample letters to use to write to your creditors to repair your credit and fix errors, sample budget spreadsheets and resource information listed by state.

Visit my website at hefreemanenterprises.com/books.html to purchase a copy today!

Credit Card Tips for College Students

According to Nellie Mae, 56% of undergraduates get their first card at age 18 and 91% of final year students have a credit card. 56% of final year students carry four or more cards. The average outstanding balance on undergraduate credit cards was $2,169.

As parents you have to teach your children how to use a credit card. Credit card companies are waiting for your students to go to college and get in debt. If you don't teach them about proper credit card use they will end up in debt and it will take them years after getting a full-time job to pay the debt off.

The credit cards that are promoted with on-campus are the worst credit cards students can get. You have to do research to find the credit card with the best interest rate and terms. Visit websites such as bankrate.com or creditcards.com to comparison shop.

Here are some tips to help college students when selecting a credit card:

1. Explain how credit cards work, the advantages and disadvantages and all the fees associated with credit cards such as: interest rate, minimum payment, grace period, and the finance charges, late fees, etc.

2. Talk to your children about who will pay the credit card. Many times students assume their parents will pay the bill. Discuss this before your child goes to college to manage expectations.

3. Offer assistance to help your child compare credit card offers or talk to your local bank officer who can help you review terms and conditions and compare rates.

Here are 5 to help prevent overspending on credit cards:

1. Pay off your balance each month.

2. Keep track of your credit limit.

3. Use for emergencies only.

4. Know your payment due date.


5. Do not get cash advances.

Parents you can also write your state congressman and representative to complain about credit card interest rates and marketing practices used on college students.

6 Holiday Savings Tips

Most Americans spend the greatest amount of money during the December holiday season. The holidays should not be filled with anxiety, pressure or guilt about spending money during the holidays. If you don't have the money to buy gifts be honest. 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 6 tips to help you save money during holiday shopping.

1. Buy Christmas or holidays gifts during store sales in October or November.
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. Visit the local dollar store to find gifts for children.
5. 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.
6. Shop online, some companies waive shipping and handling fees during the holiday season.

More Layoffs to Come

In the past several months, many companies believed to be stable have had massive layoffs which has contributed to the 10.3 million Americans who are currently unemployed. Some of the companies that had major layoffs or will have layoffs by the end of 2008 year or early 2009 are:

Citigroup (53,000)
Bank of America (35,000)
GM (32,000)
HP (24,500 over next 3 years)
Advanced Micro Devices (AMD) (16,800)
Rio Tinto (14,000)
AT &T (12,000)
Las Vegas Sands Casino (11,000)
BT Group (10,000)
Deutsche Post AG (DHL) (9,500)
Dell (9,000)
Sony Music (8,000)
Circuit City (7,300) and will close 155 stores
Merck (7,200)
American Express (7,000)
Dow Chemical (5,000)
Sun Microsystems (5,000-6,000)
Credit Suisse (5,300)
Whirlpool (5,000)
Sprint (4,000)
National City Corp (4,000)
Pepsi (3,300)
Goldman Sachs (3,260)
Motorola (3,000)
Xerox (3,000)
Dupont (2,500)
Ford (2,260)
Office Depot (2,200) and will close 112 stores
Nortel (2,100)
Chrysler (1,825)
3M (1,800)
Siemens (1,800)
eBay (1,600)
Yahoo (1,500)
Fidelity (1,300)
GlaxoSmithKline (1,000)
Starbucks (1,000) and will close 600 stores
Market Watch (850)
Viacom (850)
Texas Instruments (650)
Adobe (600)
Nokia (600)
Level 3 (450)
Palm (200+)
Legg Mason (200)
Cisco (129)
Yum Brands (Pizza Hut, Taco Bell), (unknown)
Morgan Stanley (10% of workforce)
Mattel (Fisher Price, Barbie, HotWheels) (3% of workforce)
EA Video Games (6% of workforce)

This list equals a total of 322,724 jobs that will be lost and an increase in the number of Americans who will be unemployed.

Now is the time to show that you are an asset to your company. Take training courses or go back to school to learn a new skill. Every American worker should have at least 2 skills that can be used to get a job. Also, get a part-time job if possible and use the money to pay down debt or create an emergency savings account to cover monthly bills and household expenses for at least 6 months.

If you currently do business with a company that is closing or downsizing consider how this will affect customer service: such as wait time to reach a customer service representative, proper processing of your payments, technical assistance, and other services. Also, ask the company questions on how they will ensure that their existing customers receive exceptional customer service. If you are a good customer negotiate with them for cheaper rates or discounts.

Boost for Gavel Holders

As part of the $14 billion dollar bailout plan Federal judges will also get a pay raise. The raise was identified as a cost-of-living increase which if anyone who works in the government knows, these adjustments are automatically given every year to Federal government workers also known as COLA (cost-of-living-adjustment).

So, we ask ourselves, why do the judges need a raise from the $14 billion dollar bailout plan when they get one automatically every year? Well, supposedly the COLA does not apply to judges and Congress has to vote to give judges a raise. I don't buy that one but anyway. The Federal judges will get a 2.8% raise beginning January 1, 2009.

Well, as a taxpayer and American I am tired of everyone getting raises when our country is in a crisis. I urge you to write your state congressman and representative and express your opinion about judges getting raises and the method in which raises are given to judges. I am writing my letter today.

More Jobs Lost in November 2008

If you are still asleep or living under a rock wake up! It has been confirmed that we are in a recession and have been since December 2007. Based on this announcement by the National Bureau of Economic Research we have been in a recession for 12 months and counting. According to expert economists, the recession will last at least through the middle of 2009 and the economy is getting worse by the day.

The private sector industry eliminated 250,000 jobs in November. There will be additional private sector layoffs at least through the end of the year. Citigroup plans to layoff 50,000 employees. They have had 220,506 job cuts so far in 2008. The 3 major auto companies, GM, Ford and Chrysler are on the verge of bankruptcy or failure in addition to many stores closing or going bankrupt.

Although gas prices have gone down to below $2.00 a gallon the continued job layoffs will greatly affect this year's holiday season.

If you have not already done so, now is the time to change your spending habits and your lifestyle. Buy items on sale, in bulk, eat more casseroles, soups, ramen noodles, tuna and sandwiches, for lunch and dinner, bring your lunch to work and buy only necessities. Live at least 30% below your means to ensure you are able to survive the recession. It is going to be a long winter season.