• Taxes – Gross versus Net, FICA versus income taxes…it’s all confusing to a teenager.  Actually, it’s confusing to a lot of adults as well (unfortunately), so if you don’t understand the difference, look it up, then sit down with your child when they get their first check and explain the differences to them.  It’s important for them to know what they make versus what they bring home, and where what they’re not bringing home is going.
• Bank accounts – Help your teen open up both a savings and a checking account.  It’s not only important for your teen to learn how to use a checking account, including balancing a checkbook (which you should teach them…again, learn how to if you don’t know, because you want your child to have a good financial start, don’t you??), but it’s also important for them to learn how to save money, like starting their own emergency fund, car fund or iPhone or iPad fund etc.  Delayed gratification is a very good lesson for a teen to learn, in a world of “My super sweet 16″ TV shows and teens who expect to be bought $200 blue jeans.
• Micromanaging – The above stated, let them mess up with the first paycheck.  New fancy shoes or video games might be awesome to have right then and there, but when they have no more money because they blew it all, don’t give in and give them money from your own wallet.  Let them see what it’s like to be broke.  It needs to hurt a little. 

This is a great article, so check it out!  Don’t let the opportunity to impart good financial lessons to your teenager pass you by!!!

My favorite item on the list has to be weddings, since I have somewhat of a personal vendetta against high cost weddings.  It’s not that I don’t want people to have a nice wedding full of memories, it’s just that I don’t think we need to spend an average of $19,000 (according to the article) to make these memories.  Friends and family make the memories of your wedding (trust me on this), not the decorations.  Use less expensive decorations/venues to cut costs.  Have a friend throw you a “stock the bar” shower as opposed to a lingerie shower, since we all know that the lingerie ends up on the floor anyway, and save a ton on booze.  Either way, cut your costs, and put that money into savings!

Another favorite off the list?  Kitchen gadgets!  We all love them and we all buy them (unless of course, you use your kitchen as a closet or can only cook 5 meals, and therefore eat our a lot), but do we really need them?  Be honest!  Do you really need that pasta maker?  Have you ever made pasta from scratch?  Or is it more likely that you bought the gadget and still buy your pasta pre-made from the grocery?  Whatever the gadget, chances are you don’t need it!  You should either save that cash, or put it toward something useful, like saving it up to buy a good set of knives or cookware!

There are 8 other items on the list, which I strongly suggest you check out!  Some are funny (electronic litter box, anyone??), and others are practical, but all are a waste of money!

We would like to take this time to wish everyone a Happy Father’s Day this Sunday, and would also like to notify you that we will be taking next week off from writing, as we celebrate the birth of our daughter.  As our regular readers know, we take family time very seriously, and think that spending time loving each other is a key element in a happy marriage, and of course, loving more and living better.  Therefore, that is what we’re going to do next week!  Have a great week next week, and we’ll see you soon!

I myself am currently named as an Executrix of an estate, although I hope not to have to be saddled with the job for many, many years, and, after I got to reading the little article on CNN Money, I began to wonder what the  basics of executing a will were, and whether or not I knew any of them.  I mean, I have no doubt that I can and will carry it out to the best of my ability, but I am no expert, and therefore, would like to have some tips on the process and legal issues that might arise.  The article I found surpassed my expectations.  From contacting the funeral home to contacting a lawyer (if necessary), this checklist has a little bit for everyone.  An important question raised is how to pay for the funeral if it has not been paid in advance.  Life insurance “isn’t paid in a week” as it says, and therefore the author recommends that the owner of the estate have money set aside for these expenses if they don’t pay for them ahead of time!  What a great suggestion!

This article not only has tips for the executor of the will, but also, at the bottom of the checklist it has some tips for the person with the estate.  This is fantastic, if you ask me, because more often than not, the issues that arise from a will (other than people being petty over material mementos) are because the deceased person doesn’t have their affairs “completely” in order.  For those of you with a will, I would double check this list to be sure you haven’t missed something.  The best tip (in my humble opinion) was to have a specific folder, binder etc. that is stored in a place that the executor and another family member know of that has ALL of your important information in it, from wills to passports to divorce decrees…and not copies either!  They need to be the originals!

I suggest to all of our readers to check out the article.  This just seems like information that could be useful for most of us in the future, especially if you follow our suggestions and get yourself our of debt and start building wealth.  You could have a “nice chunk of change” to leave to your family, and you don’t want them to get a headache from your gift!  Happy reading!

• Krispy Kreme – 1 free doughnut per customer, no purchase necessary!
• Dunkin’ Donuts – free doughnut WITH the purchase of a beverage!
• LaMar’s – 1 free Ray’s Original Glazed Doughnut, no purchase necessary!
• Shipley Do-Nuts – Free glazed doughnut WITH purchase UNTIL noon!

Don’t have one of these shops near your house?  Check with local mom and pop shops to see if they’re celebrating the day!  If not, explain the day and see if you can get a freebie (or freebie with purchase).  Hey, it never hurts to ask!  Have a great National Doughnut Day and happy eating! 

A special thanks goes out to Amy for bringing such a yummy article to our attention!

So, I did a little math, and if these people, who don’t make above the poverty line, invested that 9% of their $13,000 a year, which works out to $97.50 a month, over 50 years with a 9% return over that time (reasonable rate of return), they would have a little over $1 million dollars at the end!  Yes, you read that right!  $1 MILLION dollars at the end!  That means that there is a good chance for ANYof those people earning $13,000 a year to have a million dollars when they retire, if they are disciplined enough to invest what they spend on a chance at instant gratification! 

And that’s the difference, isn’t it?  Most of us DO NOT win the lottery.  We know that it only parts fools from their money.  What truly helps people build wealth is discipline with their money and the ability to wait for the payoff over time.  Problem is, I don’t know if a poor person would believe me if I told them that they could have $1 million dollars when they retire.  However, given the study and the little bit of math above, we hope you decide that the lottery is a waste of money and perhaps saving to become a millionaire isn’t as hard as you once thought it was!

• With regard to your career, the author suggests that you heed your enemies.  The logic behind this advice is that the people you have trouble with are generally those people that have the greatest insight into you and your attitudes and faults.  What these people have to say will help you improve as a worker/entrepreneur…if you only take the time to listen.
• With regard to the stock market, buy and hold your funds.  The author and I agree on this…people think that they can beat the stock market, but in reality, almost no one can (and you are probably not the exception).  If you buy funds and then keep them over the long run, you’re more likely to make money, at the very least thanks in part to the ability to avoid taxes and other fees.
• Don’t be a fool with regard to your love life.   When lovers quarrel, each has the blame around 50% of the time.  Understanding this fact will help you build the kind of relationship that isn’t as susceptible to a divorce.  And as all of us know, either from personal experience or the experience of a friend or loved one, divorce sucks.  We don’t want it and should avoid it at all costs (both financially and emotionally). 

That’s it.  3 very simple little lessons that might save you a lot of headache or heartache as your graduate enters the post high school, trade school or college life that they have worked so hard to achieve.

As of this past Wednesday, Microsoft released its Office 2010 Suite to businesses around the globe, and is planning a release date in June for individual consumers.  Why is this big news?  Because this release includes an online component called Web Apps…for FREE! 

So, what are Web Apps?  They are applications that have the ability to create, edit, view and share files online, similar to GoogleDocs, that are accessed on Microsoft’s SkyDrive website.  And the best part is that you don’t have to buy the software suite to be able to use the online tools!  Microsoft has made the decision to offer most of Office 2010 (some things are disabled) for free to anyone in an attempt to compete with (squash??) the rising popularity of Google Docs. 

Basically, they want you to use their software!  They want that brand loyalty to continue!  They DO NOTwant you to switch to Google Docs or Open Office!  Microsoft finally realized that in order to keep their brand in use and popular with the younger and future generations, they were going to have to offer some things for free.  On top of that, they are offering free storage space on their SkyDrive website for your documents, so you don’t even have to save it to your own PC (which is a little weird to me, but I’m  skeptic). 

For those of you that want “your own copy”(those of you who are even more skeptical than me), there are some acceptable price point packages.  For a middle of the road package, you can get Microsoft Office Home and Business, which sells for $279 in a box (in the store), or $199 for a product key and includes Word 2010, Excel 2010, PowerPoint 2010, OneNote 2010, and Outlook 2010.  If that is more than you need, you can pay $149 for the box version or $119 for the product key card version of Microsoft Office Home and Student.  This package offers Word 2010, Excel 2010, PowerPoint 2010, OneNote 2010, and the Office Web Apps.  The best part about this package is that it is available in a Family Pack, allowing use on three computers in one home, and let’s be honest…for the average user, this would be all you’d need. 

Our suggestion is to use the Web Apps tools online for free.  Learn to do what you need within the free version (as there will be disabled parts) so that you can save a bundle! 

As the title of the article indicates, it appears that there has been a shift in the public mentality regarding our television viewing.  The article points out that around 90% of U.S. households subscribe to some form of pay TV (which is disturbing, since according to the last data available from 2008, 15.4% of households don’t have health insurance.  I guess that means more people will pay for TV than will pay for health insurance…I hate to say this, but if you don’t have health insurance, you shouldn’t have cable or satellite TV…you should be using that money toward health insurance), but that that number is trending downward, now that you can watch many of your shows on the internet on demand, and at least for now, for free. 

This isn’t an unheard of precedent.  Many households have cut the cord to their land line telephones, keeping their cellular telephone as the sole form of communicating in many cases.  The reasoning behind the declining interest in pay TV is also similar to the decline in interest in land line telephones:  The cost just keeps going up!  Cable and satellite TV are, frankly, both outdated technologies in comparison to the Internet and it’s current speeds for your PC (and in some cases your mobile phone).  In spite of this fact, they still have average yearly rate hikes of around 5%, putting current prices around $71 per month.  The 5% rate hike could end up being worse too, because the 4 big broadcasters (ABC, CBS, NBC & Fox) have cost the cable and satellite providers nothing to air in the past (this is because they are available for free over the airwaves anyway), but now, these networks are demanding fees for their programming comparable to other cable networks, and unfortunately, they are receiving them!  This is ridiculous, because the fees get passed on to those of us that subscribe!

Don’t be fooled though.  The networks who provide this entertainment might be offering the content for free online right now, but they will start to charge eventually.  They’re not going to allow one cent of profit to fall between their fingers.  Any lost revenue through cable/satellite will be made up in other ways.  Eventually, I predict there to be a fee for both cable/satellite and a ”subscription fee” to watch your shows on sites like Hulu.com on demand.  At that point, you as the consumer will have to decide which service to go with, or allow these people to “double dip” once again and convince you to subscribe to both services!

I love this tool, but I should tell you that it slightly deviates from our views in a couple of places:

• They suggest keeping your house payment under 28% of your gross income.  We suggest you keep it under 25% of your gross income.  I know it’s just 3%, but that can add up!
• They suggest that you keep your debt under 36% of your gross income (including house payment).  We want your goal to be no debt.  First, we want you to become debt free except for the house, then we want you to pay off the house.  Given this view, there is NO percentage that it acceptable debt to carry on a regular basis.
• We are in agreement on the emergency fund.  3 to 6 months worth of expenses is what you should aim for!
• Their diversification “bubble” suggests being conservative in your retirement savings, and making use of bonds and other funds that are less risky.  When you’re older, it is wise to be conservative with your money…this is true.  However, we prefer diversifying into good growth stock mutual funds. 
• Company stock is not something that we generally talk about, but we agree with CNN Money.  You shouldn’t hold too much of one stock, even if it is your employer.  Just because YOU have faith in your employer does not mean that they are doing well in the world market.
• Regarding life insurance, they suggest having 5 times your yearly salary in life insurance.  We suggest having 10 times your yearly salary.  This is supposed to be for income replacement.  So, if you don’t need to replace your income for anyone, then you don’t need 10 times your income, and probably not even 5.  You do, however, need enough to cover any final expenses and debt you might have.
• The last “bubble” of the calculator is about retirement savings, but doesn’t really tell what you should be saving…it only tells if you’re on track to retire at age 65.  As we have always said, you should save 15% of your gross income (minimum, if you can).  This should put you on track to retire with a very comfortable nest egg.

Use this tool as a loose guideline for your finances, but don’t forget to replace their information with our information from this post in the appropriate places. 

As most of our readers know, just a few short years ago, the savings rate in the U.S. was in the negatives, and had been for a few years. That doesn’t even seem possible, does it? No, but unfortunately it is. So, what does it mean? It means that as a nation, we were spending more than we were bringing in. We were living beyond our means. Then, the economy started to tank and many of us woke up and started to save for the future. Out of all of the bad things that came with a down economy, this was a bright point. Now, however, we’ve decided that we were saving more than enough and that it is time to blow through our money again! WHY would we be convinced of this? Did we all suddenly wake up rich? I don’t think so! We need to realize that the more we save now, and the earlier we start saving, the more we will have when we retire!

The recent 1.5% decline in savings, if continued over 30 years could mean the difference between retiring comfortably and retiring on “just enough”. It could mean the difference between taking trips to fun locations when you retire, or having a need to have a part time job when you retire. I don’t know about you, but I’d say that it’s worth a few sacrifices now to get to retire without the stress of money problems. Getting out of debt now and saving for the future should be a top priority for all of us. Read the article. Get motivated. Then get started on saving, or try and do more than you already are!

The article  revolves around 3 tax problems…the Bush administration tax cuts, the Estate tax and the investment income tax.  The Bush administration tax cuts are about to expire.  This isn’t a concern for many Americans, but to those it affects, it will mean a large chunk of money out of their monthly budget. 

The Estate tax, however, will affect many more people, since it covers anyone who leaves behind an inheritance between $1 million and $10 million dollars.  Don’t think it’s a big deal to tax estates?  Well, If you’re planning on having a nest egg, saving your pennies now for retirement, then you should think it’s a big deal.  Many of you will reach the minimum $1 million dollar cut off, and if you fall into that estate range, you should know that your estate will be taxed at a 55%  tax rate!  And for most of us, we will just barely break into the $1 million dollar range, which means that you proudly managed to save up all of that money, only to have $550,000 of your $1 million dollars taken by the government.  Take my advice and start “gifting” (check into yearly limits on how much you can gift per person) some money while you’re alive if you fall in this category.

The last tax issue covered in the article is the investment income tax (also called a capital gains tax) that is slated to raise in 2013.  I know this sounds like it only affects people “on Wall Street”, but I’ve got news for you; If you have stocks, bonds, precious metals or property, and sell them for a profit (with few exceptions), then you will be feeling the raise in this tax.  Stocks and bonds outside of retirement accounts might not be something many people participate in, but lots of people buy and sell property, and if you do, you will feel the change!

I know it’s hard to look 20 or 30 years in the future and see how these things might affect you, but you have to go there.  You have to know what you’re up against.  These changes in the tax code will be painful on more of us than we are led to believe.  Remember, saving $1000 a month will (on average, based on assumed 8% return) put $1 million dollars in your bank account in 28 years.  That isn’t too far fetched.  You could definitely do that.  And given that fact, you should worry about how it will be taxed.

Normally I am a big fan of Dave Ramsey’s School Curriculum, and although I still am, FoolProofMe has one feature that Dave Ramsey’s education tools don’t have:  They are free (thanks to contributions from credit unions and non-profit organizations).  FoolProofMe is a program that has specific lessons (based on age group) teaching people about finance.  They show young people what happens with their finances when they make poor decisions regarding money in their web based videos.   On the website you can find individual programs for high school teachers to use in their classrooms, college kids, as well as for parents who are home-schooling their children and grandparents, which is the same set up as Dave Ramsey’s school curriculum.

Whether you choose one of these options, or simply send us your question regarding helping you or your young child/friend with a money question (we will soon be adding a feature for you to be able to leave an anonymous question), you need to choose some method.  Our population needs this education.  It is crucial.  Without a financial education, we aren’t capable of making the informed financial decisions that we all face as adults.

Lots of companies offer so called “free” credit reports, but many of their claims aren’t worth a hill of beans.  Once you go to their websites, or bricks and mortar locations, you find out that they want you to sign up for subscription services.  Some of them even offer monthly monitoring services for your credit, and come with a monthly fee as well.  As of yesterday, however, they can no longer claim to offer free credit reports without a disclaimer on their websites, and in September, the disclaimer will also have to be included in radio and TV ads.  Under the new rules of the Credit Card Act of 2009, any website advertising free credit reports has to include a disclosure  on the top of each page that says “This notice is required by law and you can read more at FTC.gov. Also: You have the right to a free credit report from annualcreditreport.com, or by calling 877-322-8228, the only authorized source under federal law.”

I love it!  It’s about time something was done about the misleading advertising I see all over the TV with regard to credit reports.  It is a great way to keep people from being tricked into signing up for services they don’t want or need.   The fact of the matter is, there is only 1 website that actually offers a free credit report, and that website, as stated above, is annualcreditreport.com.  You should run your credit report every year, but don’t fall for the scams!

Now, in the case of Blockbuster, I am referring to the fact that they have been lagging behind in innovation for years at this point, and appear to finally be doing something about it.  You see, when Netflix came around, 13 YEARS ago, I guess Blockbuster didn’t see them as a threat, and ignored them.  They ignored them until 2004, when they finally launched their own DVD by mail operation!  This gave Netflix a 7 year head start, which means that Blockbuster wasn’t innovating, they were merely trying to catch up.  You see, innovation is defined as a new way of doing something, and that isn’t what Blockbuster was doing.  They were merely trying to compete.  Now that they are almost near bankruptcy, with actual brick and mortar stores becoming obsolete, they are trying everything they can to get out from under their $1 billion dollars in debt, and luckily for them, that includes innovation.  They have announced a deal that makes them the first in the market for mobile devices.  What does this mean?  Smart phone owners will be able to purchase or rent movies from Blockbuster over their phone to watch on the go.  The problem?  Right now the service is only available at T-Mobile.  It has been said it will be available on Android and Windows Mobile phones soon, but not now.  What about the I Phone?  Well, Apple is in talks (rumored) with Netflix.

As far as things go, I applaud Blockbuster for trying to innovate to save their company, but I fear it is too little too late.  Their business model of their brick and mortar stores became obsolete a few years ago.  Not only do people find it easier to just “update their queue” with the movies they want to watch, but they can stream movies live and save money since the monthly fee generally works out to be cheaper (and no late fees).  I mean, I remember when Blockbuster was charging almost $5 to rent a movie, and would charge a late fee if it wasn’t back in 2 days.  There is NO WAY that business model can compete with Netflix, or Redbox with its $1 for 1 day movie rentals.

What is the lesson here?  Don’t let the opportunity to innovate your job, your business or your life pass you by.  If you figure out a new way to do something in your business or your life, see what you can do with it.  Maybe it’s just a way to make some darn fine chili very fast (I am very proud of my chili), or maybe it’s a way to revolutionize how we look under our clothes, like the inventor of Spanx, Sara Blakely.  Maybe you decide that there is a better way of doing something at your job that will save the company money (and possibly get you a nice bonus), or maybe you decide to innovate your whole life, and do everything in a different way.  Either way, don’t wait to act on an idea! 

The first thing you should know is that the census has 10 questions (some with multiple parts), and none of those questions should ask you for a bank account, credit card or Social Security number.  If the actual form is followed up by an email or phone call, that is a scam.  The census will never contact you by e-mail.   Another little tidbit that most people don’t know:  If you don’t mail back your census form, it’s possible that a census official will come to your home.

If and when a U.S. census worker shows up on your doorstep they will have a badge.  You should ask to see their badge and personal identification and write down that information.  Do not answer any questions before seeing their ID.  They should only ask the same questions that are on the form (no bank account, credit card or SSN questions) and should not ask for any cash.  You DO NOT have to pay for the census.  If you are unsure about the form you have received or anyone who has contacted you about your census, check out the U.S. Census Bureau’s website to be sure.

If the child decides not to go to school, there will be penalties in an ESA or 529 account that isn’t used for schooling, so you can just kiss some of that money goodbye.  Now, this isn’t a totally terrible thing, since had you not saved it for education, the money would’ve been taxed anyway, but I’m sure it will still sting a little.  I don’t have a huge problem with a child that decides not to go to school, financially anyway, because it’s not impacting your budget, only (possibly) their future. 

My problem, as I’m sure our regular readers know, is with the child who asks for (demands?) the money you saved for their education, to be paid out to them in cash, since you paid for their siblings education.  In spite of what your child seems to think, your money is NOT their money.  I know that you want to be fair with your 2 children, but this money was set aside for their education, not for their amusement.  It’s your money, and if the child decides not to go to school, it should STAY your money!  Like the article says, if the child wants money, tell them to get a job! 

An example of the worst increase?  The University of California, which estimates a 30% increase in the 2010-2011 year, thanks to the huge state deficit that’s been in the news for the last few months.  But irregardless of these increases in tuition prices, public schools are still much cheaper than private schools, which average $26,273 a year!  And people pay the price tag, so there is no deterrent to raising the rates…so it will continue. 

So what do you do?  You start saving for college, for you or your child, and you start saving as soon as you can!  Dig into our past blog post that has tips for saving for college.  With rates going up so often, you should be looking into savings plans before you go to college or before you have children.  Planning for the future is always a good start on the road to success!

Now, I’m sure you can tell from above, we believe if you can’t keep a minimum amount in your bank account, or can’t keep from overspending because you aren’t diligent, then you shouldn’t have a bank account, and should operate on a cash only (money orders to pay bills) system.  However, if you choose to have  a bank account, and struggle to keep funds in it, then use the other services that many banks offer, that don’t come attached to a ~$35 fee PER TRANSACTION! 

The scary stuff you get in the mail from the bank, that says your debit card will stop working and the like is true, because OF COURSE it should stop paying people if you don’t have any money in your account!  That is the way it is supposed to work!  The card is not supposed to let you spend more than you have!  Overdraft “protection” is like you receiving a mini loan from the bank…kind of like those payday check cashing places, but wrapped in a prettier sounding name.  Ignore these letters from the bank!  You don’t want to keep paying $35 a transaction loan fees for the rest of your life!  DO NOT opt in to this plan, just learn to watch your account and don’t over spend. 

If you absolutely CANNOT LIVE without overdraft and refuse to be on cash only (hard headed, aren’t you??), then there are a couple of alternatives.  Many banks will allow you to link your checking account to your savings account to prevent overdrafts.  Some will also link it to a line of credit (not something we recommend) to prevent these overdrafts from happening.  Neither of these programs are free, but they are cheaper than overdraft, and won’t catch you off guard either, because, let’s face it, if you don’t have the money to cover your purchase, you definitely don’t have the money to cover your $35 a transaction overdraft “protection”.

If or when you start receiving these notices from your bank, do yourself a favor, and “just say no” to overdraft protection…instead, be more diligent with your account, or switch to cash!

Like furniture rental places, you can apparently also rent the rims you’ve been dying to have for your car as well, that way, you can look cool, and rich, even if you’re broke.  Dan Miller has a knack for talking about topics that are important to me, and there are few things that get my blood boiling more than people who spend themselves into debt chasing status.  He highlights the new book from Thomas Stanley, author of The Millionaire Next Door and The Millionaire Mind, both of which are excellent books (I will be buying and reading this newest addition to his works).  This new book highlights some of the habits of the truly rich (as opposed to those who only appear rich), which, in general, does not include renting your rims. 

Read the post, and go buy (or check out from your local library) Thomas Stanley’s newest book, Stop Acting Rich.  Let’s all begin to be open minded to the idea that having fancy things (for status) and spending obscene amounts of money on weddings and “McMansions” are not the real way for the average person to become wealthy.  Once you stop believing you are going to simply luck into a fortune, or become famous and rich out of the blue, you can focus on becoming rich the way most people do…through saving, working hard, and striving to be the best at their passion so they can advance themselves in that particular field over the years.

• Majority of scrapped GM,Chrysler dealers file appeals - Basically, what’s going on here is that GM and Chrysler, in order to stay in business, had to cancel contracts with some of the dealerships that owned the rights to sell their cars.  The dealerships, instead of finding a different product to sell, or closing down, are filing appeals to FORCE the 2 companies to keep supplying them with inventory or to pay a huge settlement.  This will cost the already struggling automakers (remember, they were bailed out already) even more money, and they probably will struggle with getting back on track and making a profit.  I hate that these dealerships will have to close and that jobs will be lost, but when a company expands too far and has to draw back to stay in business, this is what happens.  By trying for a settlement (these dealerships agreed to the terms of the contract, they knew the contract could be terminated), they are actually hurting the company more.  Nice.
• Toyota’s next problem: Lawsuits - With the multitude of recent news stories and recalls, Toyota is working around the clock to combat the bad press and sort out their problems.  It might not help, though, thanks to the over 30 lawsuits (already, and growing) and class action suit (there will probably be more later) that are already filed against the automaker.  Here’s the deal…Toyota should pay for any medical bills (and final expenses etc.) of those people found to have directly been injured or died because of a faulty piece of equipment in the vehicle, and I have no doubts in my mind that they would willingly pay these costs.  There are 2 problems that stink with this situation though; 1. Some lawyers just see dollar signs and think of a big payday, so they will file suit for ANYTHING, even things their client doesn’t deserve, and some judges will award it, which just causes more financial problems for the automaker, and could cost jobs for their employees, and 2. the more lawsuits and such that are filed, the more bad press they receive, which could also cost money/employee’s jobs.
• Your cell phone company’s dirty little secret - The big carriers have come out recently and lowered their prices on the “voice usage” side, or the “talk time” side of their business, but their secret is that they’ve started charging non smartphone users a fee to access the multimedia capabilities of their phones, whether they want to or not.  They say it’s because most people don’t know they can access the net, so they are making sure the user gets full use of their phone.  I say bull crap.  I shouldn’t be forced to purchase a service I don’t want.  I have a smartphone and DO NOThave a data package, because I don’t need one.  I did not buy the phone for it’s ability to surf Facebook, I bought it for other features like touch screen/qwerty keyboard/nice layout/and a calendar.  Maybe it’s more phone than I needed, but that’s my choice.  They know that people pick the phone they want, and so they figure they can charge you extra for service, because you like the phone.  It’s sneaky, but clever.
• The burger and beverage recession - This one actually surprised me, but not in a bad way.  Coca cola, McDonald’s and Molson Coors all reported that their product demand is stronger abroad than in the US.  These are the products that we think of as recession proof, but apparently, people are still not willing to part with their dollars for them!  I very much hope that the companies can cut costs and innovate to continue to be profitable, but I am very excited that consumers continue to be wise with their money.  Spending less and saving more is a proven way to have something for yourself as you get older.  Are there quicker, more volatile ways?  Of course.  But with great gains comes great risks.

Follow the links to see the full articles!

Today’s article, titled, How much should I save?by Donna Rosato, is an in depth look at an entrepreneur and her retirement portfolio.  The entrepreneur is hoping that a financial planner who looked at her portfolio will “bless it” and tell her good job.  Unfortunately, like most people, she isn’t saving as much as she thinks she is!  Most people think that by saving anything, or by getting their “company match” in a 401k program that they are set for retirement…they’re not.  Yes, it is good to get that company match, but if that is ALL you’re saving, you won’t be able to retire with the same lifestyle you have now, and that is where the misconception comes in for a lot of people.  They think, “oh, well, as long as I get my company match, I can retire living at the same level I live at right now”.  WRONG!  If it were that easy, we’d all retire with no debt and a vacation condo!!  As the financial planner in the article figures out, the entrepreneur is saving less than half of what she needs to retire at her current lifestyle level. 

What is going on here?  As adults, we underestimate things…it’s what we do.  For example, we underestimate the amount of calories we take in in a day (to the tune of 20%-40% from what I have read) and we underestimate how much we should be saving.  So, how do you keep from underestimating things?  Get some help!  You can pay for it, or get the free kind.  Either will be better than nothing, but if you’re paying for it, be sure that the expert isn’t just trying to sell you products…if they are, then they DO NOT have your best interests in mind!  Need some basic (and free) ideas on how much you should be saving?  Check out this link at CNN Money, to get a rough idea of where you are and what you need.  Some extra tips are to be diversified, preferably in growth stock mutual funds, and, the article and I agree, that small cap, mid cap, large cap and international funds are all good places to invest your cash.   Whatever you do, figure out what you need to retire.  Don’t just think that a 6%-8% contribution to your 401k is enough.  Max it out!!  Start contributing to a Roth IRA!  HAPPEN to your life…don’t let your life HAPPEN to you!!!

The government is looking into extending benefits in the unemployment program for the 5th (that’s right, I said 5th) time since the recession started, just a couple of years ago!  Normally, the benefits are doled out to the unemployed over 26 weeks (aka 6 months), with the option to get a 13 week extension.  Basically, this means that you can draw unemployment for 9 months before you have to go back to work, and a lot of people do just that!  They collect full benefits before even really trying to get a job!  Why, you ask?  Well, I assume for some it’s because they think it’s “free money”, but, as we all know, that’s never the case for anything.  Somebody always pays, be it the company, the taxpayers, the government (which takes its money from the taxpayers) or the consumer (who is almost always ALSO a taxpayer).  Under the new proposed benefits, the pay outs can run as long as 99 weeks…almost 2 YEARS!

The funny thing is that some studies sited in the post indicate that people are most likely to find a job when the unemployment runs out, no matter if that length of time is 2, 26 or 99 weeks.    People seem to think that because they are drawing unemployment, they economy must really be in the toilet for everyone, and so they don’t try.  However, when there is no more unemployment, they “magically” find work.  Amazing!

There are many examples of these programs being run the wrong way and abused by some of the participants.  I’m not going to get into that, because I have a feeling many of you wouldn’t want to read a post that long.  If I’m wrong, say so in the comment section, and I’d be happy to oblige!

Dan Miller draws an interesting observation, drawing a parallel between the way bears hunt and the way we as humans acquire a job.  Bears hunt more efficiently when they aren’t given food from humans…you know, when they have to hunt.  We are the same way with money and jobs.  When there isn’t somebody giving them to us, we get creative and figure out a way to do it.  Be that start our own company, go to work for someone else or sell some stuff, we will make it work.  Can’t find work in your area?  Perhaps you should move.  Think outside the box people!

The article is a little lengthy, but it’s worth the read, if only so you can laugh at it as you read.  Here are some highlights:

• Arbitration – The author says that credit card arbitration is a fabulous feature.  Well, when I used credit cards, I never had to use this feature, even when I had problems with stores.  Also, opinions are split as to whether arbitration is good or bad.  This article says the consumer doesn’t usually come out on the winning end. 
• Automatic bill payment – Obviously, you can set up your bills to be paid from your account.  So?  You can do that with a debit card as well, which comes from YOUR money, not borrowed money. 
• Bulwark against identity theft – The author points out that credit card companies have laws in place to make sure they don’t charge you for fraudulent charges, after a $50 fee, within 60 days.  This is true.  However, debit cards have systems in place as well.  Within 2 days, it’s a $50 fee and a $500 fee up to 60 days.  Most banks voluntarily choose to extend the $50 fee to 60 days, and not charge $500.  So again, it’s a wash.
• Credit Improvement – I wish people would quit focusing on “improving your credit score through credit cards!  Having cash to pay for things makes credit cards pointless, doesn’t it?  Which makes your credit score less important.  Yes, you might need it to buy a house, but if you put at least 10% to 20% down when you buy the house, and have a good income, I doubt they will pay close attention to your credit score.
• Extended Warranties – These things are a waste of money most of the time anyway, so tauting them as an advantage doesn’t really make sense.  Period.
• Interest Free Loans – Well, interest free loans don’t matter if you pay for what you want with cash!  If you don’t have the money for it, don’t buy it.  Want money for “emergencies”??  That’s why you have an emergency fund!
• Purchase Protection - Some cards pay to fix or replace items broken that you paid for with a credit card.  They don’t do it out of the kindness of their hearts.  You, and others, are probably paying for it, you just might not know you are.
• Rental Car Coverage – Your auto insurance covers this.  So, why do you need more?  A silly advantage, considering auto insurance is mandatory, and credit cards are not!
• Rewards, Rewards, Rewards- Yes, some cards offer rewards, but that only encourages you to use them more!  Also, unless you stay in hotels a lot, fly a lot or whatever else they offer “points” for, the points are not useful.  Other rewards are usually not worth it, or are something that you could have bought outright, and saved on interest if you carried a balance.  I do know 1 person who got use out of their points, but it was her business credit card.  In general, not worth it!

My favorite quote from the article:  “I get all these goodies largely because so many other folks play the credit card game so badly.  The profits they generate for the credit card issuers essentially pay for my freebies.”  So, she plays the “game” well, and you pay for her rewards and benefits.  Why not just get out of the game?  Use debit cards or cash.  You’ll save more money in the long run!

Now, one might think that this is a good plan, since the article sights some very compelling statistics, including the following:

• 58 million people are overweight, 40 million are obese, and 3 million are morbidly obese
• Eight out of 10 are over 25 lbs. overweight
• 78% of Americans are not meeting basic activity level recommendations
• 25% are completely sedentary
• 76% increase in Type II diabetes in adults 30-40 years old since 1990

What does this mean to us?  It means that, yes, we are getting fatter.  A lot fatter.  We are coming up with new products like body shapers to hide our fat rolls, and some sort of tape to make our arms look thinner!  Don’t believe me?  Check this out!  And I don’t think anybody remembers the word “muffin top” ever being used until we started wearing pants that sat low enough on our hips to “show off” our fat rolls.  By the way, if you have a muffin top, by a bigger size and a belt! 

So we’re getting fatter!  I hate it!  I love to exercise, and I try to watch what I eat…but I’m not a health nut.  I have junk food on occasion!  I am not model thin, and don’t expect that I ever will be, since my goal is strength and not a 22 inch waistline.  However, I keep my weight within a normal weight range and an average Body Fat Percentage.  I worry about the people I see and know that don’t get any exercise, and don’t watch what they eat at all.  I worry for their lives!  I don’t, however, think that taxing the people to the poor house is the way to go about fixing it!  We’re nuts if we think these people don’t know that this food/soda is bad for them.  They know it!  Punishing them (i.e. taxing them) for their “bad behaviour” is not a RIGHT that I want to give our government, thank you very much.  The next thing you know, the government will be punishing us for all of our bad behaviours, like watching too much TV, not flossing and not recycling ALL of our trash!  It’s not up to them to legislate our behaviour. 

The article takes a much more positive approach to this tax then I would.  Yes, it breaks my heart to see children and teenagers that are not active at all.  12 year old girls that have to shop in the “women’s plus” size section at a store because the cool, stylish clothes for their age don’t fit them.  I want these people to get healthy as much as the next person, but it has to start at home.  They have to decide for themselves that they are dissatisfied with how they look and how they feel.  And then, they have to be mad enough at themselves to do something about it! 

The article says that the taxes raised could be used for education and health programs.  Yeah, it could, but it won’t be.  Have we all forgotten the promise of lottery money being used for education (read this)?  Think about it rationally, without emotion…you know as well as I do that they won’t use the money for what they say they will, or if they do, it will be like 1% of the revenue.   Taxing these people won’t fix the problem, and I don’t want the government legislating what I do or don’t eat.

The article looks at an unmarried couple who make a combined income of $50,000, and a married couple who make a combined income of $50,000.  The unmarried couple will pay only (yeah, only…ha ha) $3,076 a year under the House bill and $3,450 under the Senate bill.  If that couple decides to get married, they would have to pay $5,160 under the House bill and $5,100 under the Senate bill.  That’s a difference of between $2,084 and $1,650 respectively!  Just for deciding to get married.  The individuals that helped write the bill (democratic staff) acknowledged the existence of the penalty, but said that it couldn’t be fixed without creating other inequities.  To me, this seems like a pretty big penalty to be left in place, for fear that you would upset another group, or be unfair to others.  I mean, married couples are a pretty big group to upset!

The article has this quote from a Democratic Senate Finance Committee aide  - “The Finance Committee, along with other committees in the Senate, took pains to craft the most equitable overall structure possible, and that’s what we have here,”.  The MOST EQUITABLE bill.  So, they know it’s not fair for everyone, and one group that will pay will be married people!  This gives people an incentive to stay single.  Great!  Just what we need in this country!  A financial incentive to lose the institution of marriage.  As a country, we’re already doing things that would have been morally wrong just 20 years ago.  Gone on 2 dates with someone?  Ehh, that’s long enough to sleep together.  And we wonder why children in the 6th grade are experimenting with sex…could it be their role models?

I know that legal “mumbo jumbo” is the last thing any of us want to read or look into, but I think it’s important that we know what is and isn’t being approved with the new health care bill, especially since our politicians have a habit of sneaking in extra things when they pass a bill/law.  Be aware of your government!  Watch what they’re doing.  If you don’t, then when things don’t go your way, you have NO RIGHT to complain!

Generation Y is a term applied to those people currently 22 to 33 years old, of which, I am a member.  These people are typically the offspring of Baby Boomers, and according to many in the work force, are nothing like their parents, especially in how they view their jobs.  In the past, this (my) generation has been characterized as a bunch of job-hoppers.   But now that they and their friends are experiencing layoffs and financial problems, the number of those surveyed that had changed jobs in the last 2 years dropped from 40% to almost half of that, and almost a quarter of them plan to stay with their employer until they retire…now there’s some surprising information!

Another interesting thing of note, however, is that the economy and higher rates of unemployment have changed the optimism and confidence typically displayed by this group of people, and they are becoming more financially conservative…all I have to say is that it’s about time! 

Apparently, a new survey shows that 41% of Gen Y-ers have become more fiscally conservative in the last year, and nearly 2/3 say they’re “trying to save more now than a year ago”.  I think that is incredible!  To know that a lot of people from my generation are waking up and saving is great.  And as far as retirement, in the last year the number of Gen Y-ers that are saving for retirement rose from 18% to 53%, but the majority of them are only focused on an emergency fund (which is a good start!).  Considering that more than 30% of Gen Y-ers owe more than $5,000 in credit card debt, saving for an emergency and/or retirement is a nice change of pace. 

No matter what their motives, the Generation Y group has started to notice the benefits of saving money and job security.  I have feared that my fellow Gen Y-ers would never learn this lesson, but I am happily wrong.  Maybe it was the economy, maybe it was the fact that it became cool to be a “recessionista”…or maybe it was that we got tired of hearing the word “recessionista”, and started watching our money to get people to quit using that word…either way, it happened, and hopefully it’s here to stay!

Dan Miller has pointed out other products in this post, however, that might not necessarily be able to be pigeon-holed in the need category.  He talks of the fancy tennis shoes that have come about in the near past, that help with stabilization and have a broader base, and their new counterparts that are narrower and simulate running barefoot at $245 a pop (I spent a lot of time deciding which way to go on this very topic when I decided to start running)!

Another product, Bling H2O, that has been on MTV is encrusted with Swarovski crystals that spell out “bling” on the bottle.  The funny part is that the water comes from Tennessee, and probably isn’t very “blinged-out” on some guys farm.  That doesn’t stop them from sealing the bottles with a cork and calling it “Limited Edition”.  The funny part is the price!  This water can be bought for $441 dollars a case (12 bottles) or $36.75 a bottle.  Can we say ridiculous?  Funny thing is, people are buying it! 

And this is Dan Miller’s point:  If you fill a “need” you can make a living.  If you fill a “want”you can get rich.  I agree with him wholeheartedly, I am simply dismayed at the reason for such a statement to be true.  In our instant gratification, want the best, have to be famous society, wants and desires trump needs.  We all have desires, and I think that’s OK.  But when we start to go into debt to obtain them, something is wrong.  When we start to think we “deserve” them, we are out of touch with reality, because the truth is that you don’t “deserve” anything just for being you…you have to earn it!  As sad as it is, however, it’s how things work today, so if you can find a want and fill it, go make yourself rich!

These loyalty programs are similar to those of the credit cards, where you earn points toward cash back or other “prizes”. As usual, however, it takes a TON of points to earn anything worthwhile. Luckily, a debit card doesn’t put the consumer further in debt, and these cards give the banks 1%-3% fee per transaction (However, lobbyists for retailers are trying to get that fee capped). UN-luckily, to use these new programs, many banks are charging yearly (or monthly) fees. This means that you have to use your debit card all the time and HOPE to earn the rewards while paying a fee for the PRIVELEGE to be in the program! How fun, right?

Our advice? If you can’t control your spending, and are detached from your debit card, the way you were from your credit card, and it’s not like spending money because it’s plastic…stick to cash. If you can handle using a debit card, use it. We don’t have a problem with them, since the money comes directly out of your checking account…but be aware, overdrawing on your checking account with you debit card is NOT responsible, and if that is you, GO BACK TO CASH! On the subject of loyalty/reward programs? We think you should just skip them. It takes crazy amount of effort to get anything, and costs a yearly fee on top of it!  What a waste.

We have all seen this in our own lives, if not to the extent of jail time.  Somebody tells a little white lie on their resume to make themselves sound better for the job.  People update their statuses to make themselves sound more fabulous and exciting than they really are.  They embellish the problems they had on their car ride/plane ride etc. to make you feel sorry for them.  Whatever the situation, people like to exaggerate when it comes to who they are and what they do.  The sad part is, who we are IS enough for most people, and the people it isn’t enough for are not worth your time!  Do you really want to spend your life trying to impress other people with lies, or live your life, whatever it is, without the embellishments?

Do you find yourself inventing things when you share your history with other people?  Are there things that you’d like to change about yourself, or are you happy with who you are?  If you have things you’d change, have you written them down, and set up a plan to change what you’re not happy with?  That would be where I would start!  Good luck!

Let’s not forget, however, that when we save, someone else has to take the hit.  As the article points out, in this case, that would be farmers.  They are receiving less for their products, and so that means harder times in their households this year.  I am all about a deal, but I hate that it comes at the expense of others…keep this in mind when you go to buy your turkey this year.

On a personal note, I would like to take the time to ask our readers to have a generous heart and donate a couple of cans of food to a local charity this year to help feed families who are struggling.  With a lot of people out of work, food banks and pantries will be running low on their normal stock of goods, so we all need to chip in.  At Thanksgiving, I like to donate by giving food, and at Christmas, I like to donate by giving toys, coats and other goods to local charities.  If you have $5 to spare this year (skip a latte or brown bag a day?), buy some non perishable food items and donate them.   The Salvation Army website is a good place to start.  The main page has a place to enter your zip code and find your local donation center. 

Conflicting information is what the author cites as a problem.  An advanced estimate of the annualized 3rd quarter GDP was up 3.5%, but consumer spending fell 0.5% in September.  The GDP numbers are a result of government spending, and, as you would expect, unemployment, and the fear of unemployment are the result of the slump in consumer spending.  The fact is, a recent poll showed 58% of people (October)  still believe the recession is hanging on, up from 52% (September).  And while public opinion certainly isn’t the only factor in the economy, it DOES factor into the economy.  This is obvious…if people think the economy is down, it affects the way the go about their daily lives, and what they do and don’t spend.

You see, there are a lot of opinions out there on where this country and it’s citizens are headed thanks to this economic mess.  Some are saying that we are fine and that everything will go back to “normal” soon, and some conspiracy theorists seem to think we’re going to become third world nation.  The truth, thankfully, is probably somewhere in the middle.   If you read the original article, you should check out some of the absolutely ignorant and insane comments posted by readers.  I’m no economist, but I’m also not going to listen to anyone whose claims sound outlandish at best and pray on the fear and ignorance of other people.  My guess is that the economic turmoil will continue for a while…how long? I have no idea.  The economy needs to correct itself from the inflated values that  we placed on our assets (namely, our houses), and until it corrects itself, I don’t think things can get better.  However, I DO think things will get better.  Banks will start lending again, companies will start hiring again and people will start spending again.  Do I think it will go back to the way things were? No, and I hope it doesn’t.  We shouldn’t expect to buy a home and 3 years later move with 50% equity because of the jump in value…that’s not right.  Slow and steady wins the race people.  When things start to improve, you will have to SAVE your money and PAY DOWN your mortgage for there to be equity in it…and that’s the way it SHOULD be!

The article highlights that Bank of America will start charging an annual fee (next year) on card holders, some of whom have either never carried a balance or never paid late.  The fee will range from $29 to $99.  And apparently Citigroup has already started charging annual fees to those card holders who don’t put a charge a specific amount to their cards per year!  Can we say ridiculous??  They are starting to charge us for good behavior? What a crock.  I mean, I understand that as a business they need to make money on all of their customers, and as consumers we have the right to switch, but with the bad “rep” these people have right now, you would think they wouldn’t want to upset the customers they have that can actually pay their bills.  A little money off of a responsible cardholder is better than none off of the cardholder in bankruptcy court if you ask me.

So, what’s the deal?  These fees are the credit card industry’s response to credit card legislation (voted on earlier this year).   Basically, they need ways to raise income before the new rules take effect in February, and this looks like a viable option.  It’s my opinion that they’ve got to be desperate for new revenue streams, since they’ve targeted card holders with good credit ratings, good credit history and a knack for paying their bills off at the end of the month.

The article goes into detail on ways to tackle this problem if you find yourself among those with a new annual fee for “good behavior”.    Use those if you must, but as you know, your favorite southern couple would just rather you didn’t have/use credit cards at all!

So, what is a reverse mortgage?  Well, you can read the full description here, but a simple explanation is that it is a loan for senior citizens, used to release (give back to the owner) the equity of the property as one lump sum or multiple payments over time. The home owner’s obligation to repay the loan is deferred until the owner dies, the home is sold, or the owner leaves (usually going to a long term care facility). 

Today’s article (CNN Money Blog post) is titled Reverse mortgages: Sub prime mess déjà vu?, by Carla Fried.  It looks at how a lot of retirees are taking out reverse mortgages, since they have insufficient nest eggs to carry them through retirement, and how a lot of people, Comptrollor of the Currency John Dugan included, think these financial products have some of the same characteristics as sub prime mortgages.  Considering the mess to which the sub prime mortgages contributed, that should definitely make us be wary of these products.

Some resources to check into, if you want to learn even more about reverse mortgages and their pitfalls, are as follows:

• AARP.org – A section on this website is dedicated educating seniors on reverse mortgage basics, their alternatives and ways that the financial product might be abused.  Check out the web page here.
• U.S. Department of Housing and Urban Development – An informative website put on by the government.  It’s not as suspicious of the reverse mortgage product as the AARP website, but it still speaks of the dangers of scam artists peddling information that they give away on their website for free!

I know that there are some people who think these products have their place, but I have to disagree.  As I have said, I’m fine with 15 yeaar fixed rate mortgages, but products like these, just seem to part people with their money.  Make your own choice, but don’t say I didn’t warn you.

Basically, the jist of the 10,000 hour rule is that the author’s research shows that it’s rare for a person to get to the top of their game in their chosen field without putting in at least 10,000 hours of preparation. 

Raw talent is apparently not as important as the time you devote to your passion…to that thing you do better than everyone else.  No matter who you are and where you came from, no one gets to the top without the 10,000 hours.  And, supposing you want to get to the top of your field, that means you’ve got to WORK!  In a 40 hour work week, you can finish those 10,000 hours in 5 years.  If you’re doing a part time job at 20 hours a week, that’s 10 years.  If you’re working 60 hours a week, that means you’ll finish in 2 1/2 years, but it also means you don’t have a work-life balance, and I can’t agree with that! 

Where are you putting your hours in?  Are you putting effort in the areas of your life that matter the most, or are you leaving work, coming home and turning into a couch potato?  I truly hope you’re not ignoring your family in exchange for mindless channel surfing.  And hey, if the area of your life that matters most, that you want to be excellent at is your relationship with your partner, I’m totally cool with that!  So long as you are putting in the hours and are excellent at something you love, your favorite southern couple is behind you!

The numbers for unemployment in September show that it rose to 9.8%, and that it might hit 10% in the near future.  But as bad as the overall unemployment rate is, the breakdown of single versus married people is interesting…it’s almost double!  In August, the rate was 13.5% unemployment for singles and 6.3% unemployment for married people!  The article points out that a likely reason is that married men are motivated to take a lower paying job, to be able to support their families, and that single people are typically younger and have less education and experience than their married counterparts (this, of course, is just supposition).  There is also a difference in those with a high school education versus a Bachelor’s degree or higher.  Only 4.9% with a Bachelor’s degree are unemployed, versus 10.8% with only a high school education (a good argument for staying in school and going to college).

There is also disparity amongst race, gender, and age.  And, while these statistics are interesting to me, I have to think that there are ALWAYS discrepancies amongst employment based on race, gender and age, since the people in the work force are constantly changing.  I’m not taking away from the fact that these people are suffering.  There are a lot of people out there suffering, and I wish them a job…pronto.

Here is the breakdown:

• African Americans – 15.4%
• Hispanics – 12.7%
• Caucasions  9.0%
• Asians – 7.4%
• Adult Women – 7.8%
• Adult Men – 10.3%
• Teenagers – 25.9%

Overall, I’m most intrigued by the stats on single people.  If single people are more likely to be jobless due to their unwillingness to take lower pay, I say that it is their choice!   As long as they have an emergency fund in place to carry them through this tough spot and/or are working a part time job til they find the “perfect job”, so be it!  And for those of you who are married, taking lower paying jobs, don’t forget your worth!  No matter what your situation, having an emergency fund and being prepared for a job loss will help you weather any storm!

I will give a brief definition here, but if you want the full description, check out the original article.

• Bailout – This was the money designated for and given out to struggling businesses (usually very large businesses) whose closure would negatively impact the economy.  Had, for example, an automaker like Ford closed, thousands of people would have been out of a job.  However, the financial situation of the business was such that it wasn’t making enough money to support itself or it’s employees.  Think about that…businesses that don’t make money (aka a profit) can’t pay their employees and have to shut down.  That is the way things are supposed to happen (not that I wish a job loss on anyone, but unfortunately, jobs come and go…luckily, qualified people find new jobs, or start their own businesses and make their own way).  Some (myself included) would argue that by using taxpayer dollars to keep these types of businesses functioning, we are all (taxpayers) collectively paying the salaries of these people, and paying for the business to stay afloat. 
  • On a slightly different (but not too different) topic, the “cash for clunkers” program, which offered a $3500 to $4500 voucher that a consumer could give to a new car dealer and get that amount off of the purchase price of a new car.  These vouchers were paid for out of the bailout program, which means that the vouchers were covered with taxpayer dollars.  That means that if your neighbor got a new car with the “cash for clunkers” program, you are providing some of the money to cover their discount…i.e., you paid for part of their new car. 
• Consumer Confidence – This is a gauge of how the average consumer feels about the economy (whether or not it is strong and relatively safe, or weak and unsafe) at that time, and what is coming in the future.  Unfortunately, if people aren’t informed, their response or confidence in the economy can be misguided.  Stay informed!
• Deflation – A decline in prices across the country.  While this sounds fantastic, it can cause problems.  Prices falling means people are spending less and can lead to more unemployment.
• Depression – A long recession.  It typically includes business and/or bank failures, high unemployment, falling job wages and, in general, economic collapse.  A depression lasts significantly longer than a recession, and while a recession can be considered a normal downturn (on occasion) in the economy, a depression is not normal.
• Recession – A generally accepted definition is a decline in economic activity lasting at least two quarters (6 months).  As stated above, this can be a normal business cycle, and the recession we are currently in is considered the 11th recession since World War II.  
• Stimulus -  This is part of the Government’s fiscal policy.  Fiscal policy is the use of government spending and revenue collection (i.e. tax collection) to influence the economy.  Stimulus, in particular, is a short term government intervention to encourage spending when they economy is weak.  An example of this is a tax rebate, like the May 2008 tax rebate, where payments of  $300 for singles and $600 for married filing jointly were issued.  Some interesting points…people who have “no net tax liability”, which basically means they don’t actually pay taxes, still received this TAX REBATE, and people who made more than $75,000 single ($150,000 married filing jointly) received an adjusted (lower) amount.  As the income increased, the rebate gets phased out.  So, people who didn’t pay taxes get a tax rebate, and people who pay A LOT more taxes get a  reduced tax rebate.  Interesting, huh?

Hope these terms help you feel a little more in the loop the next time you find yourself in a conversation about the economy!  To do more research, go here.

The article centers around Chad and Stephanie Grant, from San Diego, who are both 31, have been married 7 years and are starting a family.  They make a very good living, with a nice nest egg already started, but not a very big emergency fund.  The article points out that they have a few actions to take to be ready for baby.

If you are in the same situation, trying to start a family, I have a few tips:

• You MUST have an emergency fund of AT LEAST $1000, but preferably 3-6 months worth of expenses.
• It’s a good idea to find out what the total cost of doctor visits and delivery will be and save that amount (or as close to it as you can) to pay cash for your baby when it’s born.  It’ll be nice not to finance your child, right?
• Now is the time to get diversified, as the article points out.  Make sure you don’t have all of your retirement “eggs” in 1 basket.  You should diversify between small, mid and large cap funds, and international funds.
• Insurance!  We all know that health insurance is important, but life insurance is equally important when you are starting a family.  If you die, something has to replace your income!
• A Last Will and Testament is important for you and your spouse, but when you have a baby, it’s IMPERATIVE.  If you don’t have a local lawyer, or don’t have the cash for a lawyer, then go to USLegalForms.com and do it yourself on the cheap!
• And, of course, stock up on diapers (or ask for gift cards to buy diapers)!

That’s it!  Check out the article, and use these tips to get you on track, if you aren’t already!  Good luck, and I look forward to your questions and comments!

This article is a good look into outlet malls, outlet or “factory” stores and whether or not their discounts are really any good.   The main source sited is Ellen Ruppel Shell and her book  Cheap: The High Cost of Discount Culture.  One of the best points she makes (there are many) is that because these stores are billed as “designer quality and value price” people swallow their marketing hook, line and sinker.  They don’t question whether or not the prices are a deal, because they see a sale sign that says, for example, “30% off”, and assume that it’s a good deal.  Big mistake. Especially since, according to Shell, some stores (this is refuted by another source) raise the prices in the store so that they can mark them down, which after raising them makes them settle around regular price…wow, real savings.

Another lessen learned from this article, is that, much to my delight, and only slightly to my surprise, stores like Coach sell different products in their outlet stores as opposed to their standard retail stores.  This means that the majority (my opinion) of people who shop at these Coach outlet stores think they’re getting the same quality designer goods as the retail store, but to a trained “fashion eye”, stand out with their outlet items.  So, for a regular designer Coach bag, the price might be good, but since it’s made from lesser materials (not always) for their outlet stores only, the price might be “full price”, and you were just parted from your cash!  Something to keep in mind the next time you buy at an outlet store where the status of their brand is important…since to a trained eye, your item’s status doesn’t measure up.

Another little tip to note:   According to a recent “state of the industry” report by Retail Value News the average discount at the outlet stores is 37%.  We can do better than that on the sale and clearance racks at most retail stores.

The moral of this very interesting story is that it doesn’t matter whether or not the items in these stores are on sale, but whether or not they are a price you are willing to pay for the label and quality.

In the past, children were a wonderful help to their parents.  They were an extra hunter, an extra pair of hands to help with littler children, helpful on the farm etc.  These are not necessarily important to the modern day couple, when deciding whether or not to have children, and the factors that are important are what is probably keeping a lot of women from the path of motherhood.

The likely culprits, as the article points out, are  things like private schools and their tuition, after school activities/lessons, “play dates”, college tuition etc.  In other words, ch-ching, ch-ching ch-ching.  So, as enlightened, educated people, we have to wiegh the benefits of children against the costs of them.  Sounds terrible, but for many of us it’s what determines if, when and how many children we will have.

And if, after all of this, we still decide to have children, we have to hope and pray that the money we spent on fancy schools, lessons, extra curricular activities and college produce a well rounded, kind hearted-intelligent person who can spell the word “appreciation”, knows the meaning of the word and doesn’t expect you and everyone else in the world to hand them everything on a silver platter. 

Personally, I have to admit that I worry about my future children (whenever I am fortunate enough to have them).  I don’t worry much about their lack of appreciation or sense of entitlement, because I know that good parenting can go a long way in combating those problems.  Societal influences, however, can be very strong, and as current or future parents, we have to strive hard every day to nurture good morals and values in our children, and not let them grow up over-valuing material things or idolizing celebrities over friend or familial connections. 

So, is it worth having children?  You have to answer that question for yourself, but in my opinion, if you’re in a stable (preferably married) relationship, have graduated high school (college too, hopefully) and are earning a good income that can accommodate you, your spouse, your child and saving for retirement, then I say go ahead.  If however, you aren’t in a committed relationship, can’t vote, can’t legally drink and can’t rent a car, you should probably think long and hard before entering the world of parenthood!

The topics it helps you with are as follows:

• Text Messaging – Whether or not you know it, text messages charge both the sender, and the recipient.  So, if you don’t send any messages, but still receive some, you are paying for them…depending on how many you send and receive, you might like to have a messaging plan.
• Extended Calling Hours – Not everyone likes to wait until 9 pm to make all their phone calls, and certainly not everyone likes to receive them after 9pm.  Making calls before that time usually charges your “anytime” minutes, which are much more costly than your night and weekend minutes…this plan could save you significantly!
• Prepaid Calling Plans – For the people that rarely use their phones.  Low minutes, low price…sounds pretty good, doesn’t it??
• Overseas Calling – I have no real experience with this, but I know it’s expensive, so any way to save here is a good way!
• Phone Insurance – No one needs this.  It’s ridiculous.  Period.

Personally, I think it’s unfortunate that most people don’t know what type of plan they have from their cell phones to their  cable/satellite packages!  If you are paying someone for something, you should know what you’re paying for!  Don’t just let them charge you and hope you’re getting a good deal!  Look into it!  Maybe this article and these tips will help you save some money.  Remember, $5 a month is $60 a year, which will be a nice addition to your budget, no matter if it’s for vacation or savings!

How does it work? Well, people just like you become a member, and as they get gas/drive by a gas station with low prices, they send in the information to the website, which posts the information for other people to use. Membership is free, and it is very simple to send/receive the information. Over time, this can add up to MAJOR savings!

Another neat way to use this website?? When you plan a road trip, you can check out the map section on the website. Although you don’t want to alter your course A LOT, you can at least use the information to find the most reasonable prices near where you think you’ll stop, so that you can save some cash on your road trip for more important things, like fun activities!

I suggest that you try to get gas in the middle of the week, since it is usually at it’s cheapest then (at least it is where we live…if it’s not where you live, watch gas prices for a couple of weeks and take note of the days that it’s at its cheapest). Pick the same day of the week to get gas (like every Wednesday) and look up the local gas prices on GasBuddy.com before you head to the pump! Good luck, and I hope you save some green!

First let me say that you should keep in mind that this data reflects only one month, and that it could just be a fluke. I know that the unemployment rate has gone down slightly, and that demand for houses has gone up, but honestly, so what! Just because the economy might be showing signs of improvement does not mean you should forget the lessons you have learned over the last several months in ways to save money and spend less. One of the reasons that people have gotten into trouble with money over the years is that they spend all that they have, or more than they have and don’t save enough for their future when they retire, or, just as bad, save for when their income is lost/interrupted, so that they have no emergency fund.

Deep down, I’m hoping that spending rose because we are in “back to school” season, and parents were spending money on their little ones clothes, crayons and paper, but I just don’t know. Americans tend to have what I think of as collective ADD, where, as a nation, we can’t keep our “eye on the ball”. When something loses its luster or lasts too long, we tend to get bored, and I think that the recession has reached that point. I ask all of you to keep your focus, save your money and spend less.

The question posed to the authors centers around 3 sisters, whose parents are elderly and have lost most of their money in the stock market. Now the sisters are helping the parents, but don’t know how to divide up the bills, given their different economic situations.

The article points out one thing that Jerrill and I are passionate about: We believe that there is value in jobs where people aren’t paid, such as caring for elderly parents or stay-at-home moms etc. The authors are quick to point out that if one sister is caring for the elderly parents, her time has a value that must be included in the division of responsibilities, monetary or otherwise.

Once they’ve placed value on that time, then they should sit down and have a very frank discussion about each other’s situations and what they can afford, even if they don’t want to talk about it. I should be clear that we don’t believe you should have to pay more simply because you make more…that isn’t fair. If you make more and are contributing more money, then the other family members should be contributing in other ways, especially if they can’t contribute money because they’re a spendthrift…frankly, that’s no excuse.

So, check out the Q & A. It’s insightful, and highlights a problem that we believe will become more prevalent as more people realize how light their retirement accounts have become!

This article discusses the pay raise range going on in the economy right now, which has a median of 2%-3%. Given the unemployment rate and the slumping sales going on right now, that’s not bad. Also, at least they still have a job. That said, counting your lucky stars that you have a job isn’t enough. Yes, you should put in that extra effort right now to make yourself stand out and be more indispensable, but you should also remember your worth. If you are producing results (bringing in clients, raising profits, lowering costs etc.) then you deserve to be compensated. And, if there is simply NO money for raises and bonuses at your company at this moment, keep producing “top notch” results, but discuss other “perks” that you might be able to get with your boss. An economic slump isn’t an excuse for treating employees with disregard.

It boils down to this: If you’re looking for a job, you should be spending hours a day looking for it, and good luck to you. If you have a job, work hard to keep it, don’t be surprised at a lower than usual pay raise. In good economic times, or in bad, don’t let them take advantage of you and keep up on how others are being compensated in your field.

As you can imagine, this did not work out the way he had hoped. With all of his objections to spending money, on from what I take from the article is a daily basis, he starts to realize just how hard that is and just how much money he actually spends on a daily/weekly basis. He realized the kinds of sacrifices he had to make in order to stay true to his word. And some of those sacrifices weren’t worth it.

The article is awesome, and definitely worth the read. As you know, Jerrill and I are always looking for ways to save money. We try to find the best deal, bargain with people, find ways to cut costs and will often buy the store brand etc. to save some money. And, we want everyone to make sacrifices to help balance their budget and grow their emergency fund/retirement savings/kids college fund. It is our goal for you to become/stay debt free…but you should keep it in perspective. For example, buying the store brand or dropping your daily $6 coffee habit might be totally worth it, but skipping your child’s birthday present might not be. Just something to keep in mind.

Basically, Microsoft has been watching other companies like Google and Open Office provide free versions of “Office” like products for years (I myself use Open Office instead, and am happy with it so far) and are now getting in on the action. Their free versions of the Office software will be limited, with the ultimate goal being to up sell people into full versions of the software. However, for those of you who like Microsoft Office and don’t want to pay the premium for all the bells and whistles, this new free version (available sometime in the first half of next year) just might be for you. I know some of you might be worried that it will only be available in IE, however Microsoft says it will support Firefox and Safari as well!

Just something to keep in mind. Not only is this a great way to save some cash, but it’s also interesting that Microsoft, “king of the paid software”, is giving anything away for free!

a lasting covenant between a man and a woman can be a vehicle for the nurture and protection of each other, the one reliable shelter in an uncaring world — or it can be a matchless tool for the infliction of suffering on the people you supposedly love above all others, most of all on your children.

This article is all about the importance of a strong marriage and how important it is for the children to have 2 parents in the home. It is chock full of information. It states that children of divorced, middle-class parents do less well in school and at college compared with underprivileged kids from two-parent households. This absolutely floored me. However, it does seem to fit with and support our viewpoints on family.

As the article points out, most of us do want the “fairytale” marriage, as in, married for 25 years and still deeply in love. I don’t know anyone who has gotten married and didn’t want that. We simply have to work at it. I don’t let a day go by that I don’t make sure I am doing the things that I know will be a benefit to Jerrill, or at least, make him very very happy. I focus on his happiness, and our happiness, and that ensures that I don’t take him for granted.

So, go check out the article! I really hope you enjoy it as much as we did! It’s a long read, but well worth it.

On their website, I found a section that has calulators for a ton of different things. Check them out here. Want to know if you’re saving enough to retire as a millionaire? They have a calculator for that! Want to know if you can survive the cost of living in another city/state? They have a calculator for that! There are several calculators to choose from, and from what I’ve seen, they are all user friendly.

Now, why do I think it’s a good idea to use these calculators? First, it’s always a good idea to think about your money and your future. The more you plan for it, the better the outcome, in my opinion. Also, these calculators should help those who are less knowledgeable with money matters be able to figure out if they’re saving enough, can afford the house they want and how quickly they can pay off their student loans etc. The only thing I would say is that this site doesn’t have a auto loan calculator which a lot of people need. I found a great one at Bankrate.com. Check it out here!

So, go check out the article. It is a very cool read. Anyone who is trying to decide between a gravy boat and 1 place setting of china for a good wedding gift should consider this option instead. No, it’s not on their registry, but they probably won’t end up with 2 of them, and people need this type of gift, whether they know it or not!

A good lawyer is a necessity for those people who want to be resposible with their lives and money. At the bare minimum, you should have a will drawn up by a lawyer. Yes, I know that it is cheaper to go to one of the websites out there that offer the forms to be filled out for a fee (usually less than the fee the lawyer charges), however, the form can’t tell you important things about the law that a lawyer either knows off the top of his/her head, or knows the best place to research the answer. Here’s an example: In Kentucky (your favorite southern couples state of residence), if you are married with children, and have no will, when you die, your assets (that do not have beneficiaries identified) are divided up amongst your spouse and either your children or your parents! I would’ve thought it would all go to my spouse, and I would’ve been wrong. Thanks to my lawyer, I now know better.

Most people wait too long to go to a lawyer, and for my part, I don’t know why. When you are sick, you don’t wait too long (think pneumonia or death) to go to a doctor! If your car starts smoking, you don’t wait to take it to an auto mechanic! So, why do people wait until they are in a mess to see a lawyer? I honestly do not know. They shouldn’t, because seeing a lawyer when the problem is minor costs a whole lot less then seeing a lawyer when the problem is huge! Lawyers are there to help you. They are experts on the law, the way a doctor is an expert on your health. If you need legal advice, don’t Google the problem…look for a lawyer! Some words of advice: You should research or ask around (friends or neighbors) about a lawyer you are thinking about hiring. Make sure that their work ethic and personality line up with yours. You should be able to feel comfortable with your lawyer. If you aren’t comfortable with your lawyer, you won’t be as likely to ask for their help, or tell them the whole story, which means they might not fully be able to help you.

Today we are featuring a local lawyer who has just opened his own practice in the Frankfort Kentucky area. Doug Howard is an attorney licensed to practice law in Kentucky, Indiana, and Ohio. He is originally from Frankfort, Kentucky where he currently resides with his wife and children. He graduated from the University of Notre Dame with a B.A. in History and earned his law degree from the Catholic University of America in Washington D.C. Doug’s approach to his law practice is refreshing. I believe he cares about doing the right thing, teaching his clients about the law as he goes, and the best part is that he doesn’t speak in legalese! If you would like to get in touch with Doug Howard, please check out our “links” page to send him an email!

Today’s article is Americans’ wealth drops $1.3 trillion By: By Tami Luhby

Brief summary: The wealth of Americans has been dwindling over the last 7 quarters, to amount to a hefty overall decline. Only only good news from the decline in our wealth is that the average American’s debt has also declined for the first time EVER. During the first quarter of ’09, $1.3 trillion of wealth disappeared from our wallets, and the stock market and home values are still declining according to a government report. Some things may be changing, but not quick enough. Luckily, at least some Americans have learned that debt is a bad thing. According to a source from Moody’s economy.com, “Consumers are cutting back on their borrowing to some extent, but the decline in value of assets is swamping that.” Household debt fell at an annual rate of 1.1% to $13.8 trillion for the first quarter of 2009, after falling off 2% in the fourth quarter of 2008. That was the first time household debt shrank…EVER. All I have to say is that it’s about time.

Alright, there is the brief summary. Now, it is up to you to click the link above and read the rest of the article. We’ve given you the tools, now go use them!

Today’s articles are Top 5 Biggest Mistakes When Buying a Car By: Jeremy Vohwinkle and Explain How A Car Lease Works By: Dave Ramsey

Brief summary: The 1st article cover 5 of the biggest car mistakes out there, and the 2nd article cover the one that article left out, the car lease.

Here are the “Top 6″ biggest mistakes when buying a car:

1. Thinking in terms of your monthly payment: I honestly don’t know why people do this. I guess they think they will never have ANYTHING paid off! If you go into the car buying process focused only on what you can pay each month, it will cost you in the end. The car dealer can do a lot of adjusting of the numbers to make the car you want (or a least a close second choice) fit your budget. They can change the interest rate, giving you a longer term loan, and give you “extra” on your trade in, which is usually added back into the price of the car somewhere. Higher interest rates and longer terms automatically raise the cost of the car, but it’s raised over time, so most people don’t notice. Don’t think in terms of monthly payments! Now, if you must finance your car/s, keep in mind that the total *value* of all your vehicles should not exceed 50% of your annual GROSS income. I strongly suggest saving up and paying cash for a car!

2. Buying new versus used: Vehicles are one of the dumbest things to “invest” your money in, since they depreciate rapidly, and investments are supposed to appreciate over time! All those people you see on the road in their fancy luxury and sports cars shouldn’t even be driving them unless they paid cash for them! New cars typically decrease in value by 25%-40% in the first two years…put another way, the same thing that happened to a lot of peoples’ 401K’s over the last couple of years is what happens EVERY time you buy a new car, and for some reason, no onw seems to be bothered by this. A $25,000 vehicle, depreciated 40% = $10,000…over 2 years, that’s like throwing $100 bill out the window of that new car every week! Your best option is to purchase a 2-3 year old car with low miles and a reputation for dependability.

3. Choosing the wrong vehicle: Another thing that baffles me! Why would a single person with no children need an SUV or a Dually pick up truck with a 5000lb towing capacity? Don’t buy a vehicle that doesn’t meet your specific needs. If you’re single and only need a car to get you back and forth from your job, think about a compact car. Married with children? Perhaps a larger sedan or an SUV is more to your needs. Live on a farm or have a boat? Then a truck might be more suited to your lifestyle. Just remember this when choosing a car: Sure, it looks nice, but nicer vehicles always cost top dollar!

4. Forgetting about the other costs of a vehicle: When you buy a new vehicle, you don’t just buy the car. You buy the additional costs in gas, insurance and car parts. So you want the sweet looking foreign car? Well, have fun buying the parts to fix it when it breaks down, because they aren’t cheap…and don’t kid yourself, because ALL vehicles break down at some point in time! Think you want that 2 door coupe because it looks sporty? Well, it does, and the insurance company knows it does, and will charge you more for having it. Want the type of SUV that you see the army men driving? Well, large SUV’s can get as low as 10-15 miles a gallon, so you’d better have the cash to pay your weekly gas bill! Overall, these costs can add up to hundreds or thousands of dollars over the life of the car! Just something to think about.

5. Putting no money down: I don’t even know how this was allowed to become SOP, or the norm. Why anyone would think that going to a car lot and just signing your name for a car was smart boggles the brain. They depreciate, remember? So you are immediately “upside-down” (owe more than the car is worth) in the car. This becomes a real problem if you sell the car before your loan is paid off, which most people do these days, since they don’t want an “old” car. You could not turn around 1 week after you bought the car and get what you paid for it! So, why then would you not put some money down, and purchase a car that is within your means?

6. The car lease: The car lease is probably the worst way to obtain a new car for most people. The rules and regulations in the lease agreement (AKA contract) are so strict, that most people aren’t able to stay within the guidelines. And let’s think about why some people lease in the first place…because they couldn’t afford the car they wanted by purchasing it. So, they know they can’t afford it, but they have to have it anyway, by any means necessary. Sounds like a recipe for disaster. Leasing a car is basically like renting a car. You make a monthly payment and at the end of the lease, you give it back. If you want to buy the car at that point, you have to pay what the dealer estimates the car is worth at the BEGINNING of the lease. If you pay $300 a month for 60 months, you pay $18,000 over the course of the lease. When they get the car back, you will have paid them more than the car has depreciated during that time period, because otherwise the dealers would lose money, and they aren’t going to give you a lease that makes them lose money. And don’t forget, you are taking care of the car like you owned it during that time. If you don’t, it breaks the lease agreement (contract) and they will charge you extra for that when you go to turn it in. Now, yo might be tempted to think that extra is a couple hundred dollars, but it can be thousands! So you go give back the car, and to give it back you have to pay $2,000 dollars! Nice, huh? As Dave Ramsey put it in the original article, don’t get “fleeced” (i.e. have the wool pulled over your eyes) with a lease!

There you have it…the “top 6″ mistakes people make when buying a car. Instead of falling into the pitfalls above, when you go to a dealership to buy a car, you should:

• Think about the total cost of the car, and be sure if you finance you don’t exceed 50% of your gross pay for all vehicles
• Buy used
• Choose a vehicle that suits your marital/parental status, work life and home life…not your social status
• Remember all the costs, like gas, insurance and scheduled/unexpected maintenance
• Put some money down!
• Don’t get a lease and don’t buy more car than you can afford

Today’s article is What credit card legislation means for you By: Ismat Sarah Mangla

Brief summary: Legislation that restricts “questionable” lending practices by credit card companies. The article shares the highlights of the 2 Bills, in plain language.

The original bill in question, H.R. 627, was renamed by the Senate, The Credit Card Accountability, Responsibility and Disclosure Act,or S.414, which passed by an overwhelming margin of 90-5, with 5 people not present or not voting. This bill had some changes in it from what the House sent to the Senate, so now a committee of the 2 groups will have to get together and work out the differences, so that they are in agreement. Then, it goes to the President to be signed into law, or vetoed. So, here is what this legislation means to you:

1. Due dates – In the past, credit card companies didn’t have to send you the bill until 14 days prior to the payment due date. This will now be 21 days prior to due date, and when the due dates fall on holidays or weekends, the payment will be accepted the next business day. I think this is great, because everyone needs time to plan out their budget. The holiday/weekend schedule part is interesting though, because while I agree you shouldn’t be penalized for a holiday (who knows when they are except bank employees), with regard to the weekend, you should have mailed that payment earlier, since those weekends, they do come at the same time every week!

2. Teaser rates – Both the Senate and House bill call for these “teaser rates” to be offered for at least 6 months. Well, I can’t see how this is a big deal, but more importantly, should credit card holders be falling for “teaser rates”?? Don’t fall for anything like that. Face it…if it looks like a good deal, and it came from the credit card company, it’s not. Don’t buy into the hype!

3. Cards for young adults – This is probably my favorite part of this legislation, since I saw the credit card companies hard at work (and the college students falling for it) when I was in college. The House bill doesn’t allow people under 18 to get a credit card unless the parent is the account holder, and limits college students to one credit card, with limits on their credit to a percentage of their income. But here’s the best part…The Senate bill went even further. Under the Bill from the Senate, no one under the age of 21 would be allowed to have a credit card (thank goodness), unless an adult co-signs or the person can show proof of income. Now, why do I like this so much? Well, I am very much of the opinion that people need personal responsibility, especially with money, but let’s face it…when we’re young, we don’t always know what is best for us, and we do stupid stuff. I think it is the parents responsibility to teach their children how to handle money, but if the parents don’t know how, then where does that leave the children? Most likely, in debt.

4. Retroactive rate hikes – This one can be confusing, but the gist is that if you carry a balance on your credit card (which you shouldn’t do), and then the CC company raises your rate, the new rate only applies to the purchases you make after they raise it. However, if you’re more than 30 days (House bill) or 60 days (Senate bill) late, then the credit card company can raise the rates on all of your debt. I like that it keeps them from charging higher rates on balances you carry (but again, you shouldn’t be carrying a balance), and totally agree that the CC companies should be allowed to raise the rates if you”re late. You were late. There SHOULD be penalties.

5. Penalty periods – Speaking of penalties, if you make a late payment and your rate goes up, the Senate bill says that you can reclaim your lower rate if you pay on time for 6 months in a row. I agree with this, because in 6 months you should learn your lesson. Besides, the CC companies won’t be losing any money, since the people who are consistently late will never be able to reclaim their lower rate.

6. Over-the-limit fees – This is a nice little part of the bill. Used to be, credit cards had “limits”. These would keep you from spending more then you should. The problem? People didn’t like being “declined” in public, so CC companies would just let you go over your limit, and then charge you a hefty fee. However, with the new legislation, consumers have to opt in to get over-the-limit approval, and the fees that come with it. I didn’t disagree with the fee…you shouldn’t have overcharged your card. You should have paid attention to your finances. But this is great, because you actually have to make a conscious decision, by opting in, to go over the limit. You actually have to say “yes, I want those fees”…and people will do it!

7. Gift cards – I was surprised these made it into either bill. Legislation calls for expiration limits to be no shorter than 5 years, and if there is a “dormancy fee”, it must be printed on the card. I don’t know anybody that waits more than 5 years to use a gift card, but I don’t think I’d want my money to be swiped by the gift card issuer because I’m slow.

8. Advance notification – The standard practice has been to give card holders 15 days notice of a rate change in your card. The bill changes that to 45 days. Again, I like the planning aspect of this, but if you just don’t carry a balance, then it won’t matter.

9. Payment allocation – Here’s another confusing one. Say you have a balance transfer on your card at some low rate, and purchases at a higher rate. The CC companies have been applying any payments to the lower interest rate first, so they could still rack up interest charges on you on the higher rate (i.e. more money for them). But now, any payments you make that are “in excess of the minimum amount” are applied to the higher rate first, and then the remainder of your balance in descending order. Notice the key phrase…in excess of the minimum amount, or payment. I like this because it will hopefully encourage people to pay more than the minimum amount, which is the ONLY way to get them paid off! So, you pay more toward the card, you’re rewarded, you pay the minimum, you’re not. This is good, though I think people shouldn’t need a reward for doing the right thing and being responsible.

10. Universal default – Universal default is when CC companies raise your rates on their card because they discovered that you were late on another card. Both bills eliminate this, which is good, because it’s wrong to assume that one mistake will carry over to all of your finances.

11. Account closings – Although not covered in the Senate bill, the House bill requires that the CC companies give you 30 days notice before it closes your account. I don’t know why this matters, but I don’t see it as a hassle for anybody, so I guess it’s ok.

According to the article, most of these are addressed in the Fed’s credit card regulations which are supposed to take effect July 2010. So, is this legislation necessary then, or is it that the government (the Fed is not the government…Find out what the Fed is here), specifically congress, wants to take “credit” for the new regulations, since their approval ratings are at 35.7%?? I’ll let you think on that one for a while.

Now, while I think that, in general, the government legislates too much of our lives, I am obviously, not opposed to this legislation. This is not to say that I think the credit card companies are “the ones to blame” for all the delinquent balances out there…I mean, come on, you didn’t know when your payment was due? You had no idea what would happen if you spent over your limit? You didn’t know your credit card limit, and it’s the credit card companies fault?? No, it’s not their fault that you are in debt, but they are engaged in practices that I think are a little shady, and I am happy to see that change is coming.

Today’s article is The forgotten fiscal problem By: Jeanne Sahadi

Brief summary: The release of a yearly report from the individuals who oversee Social Security will likely spark some debate because Social Security has been in financial trouble for a while, and is likely to be in even more trouble in the years to come.

Thanks to the rise in unemployment, currently at 8.9% nationally, the money paid into the Social Security system has fallen. The article states that the “White House budget office estimates that Social Security will take in less in payroll taxes than it must pay out in benefits for 2009 through 2011. And then the system is expected to start running a small cash surplus for a few years before once again taking in fewer taxes than it pays out in benefits”. What does this mean to you? Potentially, a lot, because when social security runs out of money, the government will try to make up the difference somewhere, and that will more likely be higher taxes and not government spending cuts. And while I am on the subject, I would just like to remind everyone that Social Security is not some money that the government is “giving” you. This is money that you pay in out of every paycheck that the goverment is supposed to give you back when you retire.

According to the trustees who oversee the program, it will start to take in less money then it pays out in 2017 and that the trust fund will be tapped out by 2041 (see below)…remember that the government borrowed the surplus of $2.4 trillion that Social Security had a while back. Without any action, 2041 (revised to 2037 in an article published 1 day after this article was released, which you can read here) is the date after which the system can afford to pay out only 78% of benefits promised to the future retirees, otherwise known as the people who paid into Social Security for decades only to be denied all of their money back when they need it. This is a problem people need to know about. A lack of people paying in is something that will cause problems down the road.

One of the reasons sited for the long-term shortfall is that Americans are living longer. The American Academy of Actuaries, a group of people who are experts in evaluating risk, are advising that U.S. lawmakers increase the retirement age for Social Security. This might fix the problem, but unless your benefits increase for every year that they don’t pay your money back, then they are taking advantage of you. Think about it like this: If you retire at 65, and can collect $1500 a month until you are 100 under the current system, then these benefits should increase by at least $250 each month if you are forced to wait until age 70 to start drawing
social security. But that is NOT what they are planning, I assure you.

The article quotes a recent speech the house majority leader, Steny Hoyer gave regarding Social Security. He is quoted as saying “We can bring in more revenues. We can restrain the growth of benefits, particularly for high-income workers, while we strengthen the safety net for lower-income workers. And/or we can raise the retirement age, recognizing our life expectancy is significantly higher. What is missing here is not ideas — we have a lot of ideas — it is the political will.” Now, follow what he says…they can collect more taxes, they can cut back on benefits, especially for high income workers (who, incidentally, paid in MORE Social Security taxes because they earned more…yeah, that’s fair), while increasing benefits for low income workers (which means giving these workers more than they paid in), or raise the retirement age to collect benefits(which I already addressed above).

Overall, I think the article points out a real problem for the citizens of this country. Social Security is not being funded well enough, and those of us paying in now, which pays benefits for those retiring now, are the ones who will suffer in the future when we retire. Let’s hope Social Security will be in the public eye enough to encourage people to make a back up plan, since it’s obvious, we’re going to need it!

Today’s article is Goodbye to shop ’til you drop By: Parija B. Kavilanz

Brief summary: Retailers have been suffering at the lack of shoppers shopping. They are also noticing that the shoppers who are out are being more selective in what they do buy.

It’s called frivolous spending for a reason, and it’s what Americans do well, unfortunately. We are all guilty of it at one time or another. I myself, recall buying a faux leather bomber jacket this past fall and thinking that I would wear it all the time…I didn’t. I wore my fleece zip up or my wool pea coats, as always. Alas, my very cool bomber jacket hung in the closet all winter (thank goodness it was faux)and my jacket can be added to the category of frivolous spending. So, we are all guilty of it, but luckily, it’s become out of fashion as people in the U.S. are focusing more on budget shopping.

The article points out that our retail culture is in a transition from concpicuous consupmtion to budgeting because we are starting to realize that we’ve lived far beyond our means. Things like pre-owned cars and store brand labels are starting to come back in fashion, and, for what it’s worth, I don’t know why they ever went out of fashion. There is nothing wrong with purchasing a car owned by someone else, especially if it is in good shape and fits your budget better than its brand new brother!

Another real interesting thing to note is that high income shoppers whose jobs/incomes haven’t been affected are shopping differently and putting extra money away! These high earners might not necessarily start buying less expensive items, but they will be “more selective” in their purchases and focus on the quality of the item, rather than the quantity.

The article makes a very exciting point about the retailers approach to selling and how they are going to have to change strategies. They are going to show a “value” to their product, over and above the competition, if they expect to separate us from ours dollars. This means an expansion in the type of fits and varieties. For example, tall men with a long inseam cannot go into just any store and find a pair of pants, the same way that short waisted women cannot wear all of the “long and lean” shirts that are out there. I mean, the name implies “short waisted people, this is not for you”.

As the article says, the retailers of this great nation are going to have to become more sophisticated, selling items that maintain high quality while maintaining value, that can be sold to a wider base of people. In the example of cars, shoppers want to go back to basics. A car that is mechanically sound and will last for a reasonable price is a lot more important than tilt/cruise and the “gold package”. Clothes that are designed to fit “real people with average bodies” and not just 5’11″, 22 inch waisted models will be considered investment pieces in this new economy and will sell. Everything else will be considered “trendy” and will likely be overlooked. Stores that aren’t strategizing for this outcome should take heed…when you start designing a product for a broader group of people, you will sell more items!

So, today’s article is No bankruptcy help for homeowners

Brief summary: The bill to modify delinquent (foreclosure) loans in bankruptcy court was voted down (51-45) in the senate this week, however, the Foreclosure Prevention Program still allows banks to modify homeowner mortgage payments to 31% of their pre tax income.

So, housing advocates say that the bill would have put pressure on loan servicers to modify loans before borrowers file for bankruptcy, and that is the key phrase here. The part that was voted down is only the part that allows judges to modify loans when people are in bankruptcy. The banks and loan servicers covering 75% of all of the mortgages across the country are already participating in this loan modification program, so they are lowering monthly payments to 31% of pre-tax income for those people who can’t make their mortgage payments.

The bill that was voted down, on bankruptcy reform, was a key part of President Obama’s foreclosure prevention plan. The plan includes a lot of incentives for banks and loan servicers to modify loans including incentive payments. One of the program’s incentives is that these loan servicers get $1,000 for each loan they modify, and even more if the borrower doesn’t redefault. That is a lot of encouragement right there!

Overall, I don’t know how I feel about this plan. I am happy that banks are lowering interest rates and and changing the type of loan (ARM to fixed rate or 15 year mortgage to 30 year mortgage) to help people stay in their homes. If the adjustment of payment rates to 31% pre tax means that the loan principle amount is not changing, (i.e., that a $200,000, 30 year loan at a fixed 7% is still a $200,000 loan, but that payment went from $1330 to $1100 because they adjusted the length of term from 30 years to 40 years and the interest rate from 7% fixed to 6% fixed), then I am completely happy for the banks to step in and help. However, that is where I draw the line. People should not be “told” that if they take on more than they can afford in the future, the government will step in and fix it for them. They need to learn personal responsibility.

Today’s article is “This Video Game Could Rescue Your Finances”

Brief summary: Author George Mannes and his son tested a new online video game designed to teach children and teenagers personal financial responsiblities.

Okay, so the object of the game is to collect tokens in the air. In Debt Ski (the name of this game), you are playing the character of a pig on a personal watercraft. The tokens are money (for the most part), or things you spend money on: Necessities, like food etc., that you are required to obtain and desires/luxury items like TVs etc. that give you “happiness points” when you pick them up. The cool thing is that the luxury items cost you some of that money you pick up (thankfully the video game is mirroring real life, for once). You pay for them at the end of the round, with cash or credit. At first, I had a problem with the game having the credit card option, but luckily, the credit cards count as debt, and if your debts outweigh your money, your happiness points count against you.

The point of the game is to score as many points as possible, which you get by multiplying your net worth (money minus debt) by your happiness points. This is a good thing if you have more money than debt, but if, like above, you have more debt then money, all of those happiness points count against you (which also mirrors real life). Another fun point…if you don’t buy enough necessities, you automatically lose the game, because, like real life, you have to have basic necessities before you have luxury items. Side note: Health insurance counts as a necessity. If you have a big screen TV and no health insurance, you need to reevaluate your priorities.

Overall, I think this could be a very good tool for a parent to begin teaching their children how to be responsible with money. We all know that the country is in financial trouble (at least I hope we do), but to fix the problem we have to start at home. Not only do we, as adults, need to rethink what we have been doing at home with our money, but we need to make sure that we are teaching our children the NEW THINGS we are learning (i.e. savings are good, debt is bad), because if they learn the bad habits that got us into financial trouble, they will fall into the same financial trap!

Today’s article is “11 Money Etiquette Issues, Solved”

Brief summary: Author Teri Cettina outlines 11 money/etiquette problems that can occur in our lives, that, unfortunately, most of us do not know how to resolve.

Problem #1 – Someone asks nosy questions about something you own or your salary, and you don’t want to share.

Solution – You aren’t obligated to tell, so say “I have a policy not to share prices or salaries with anyone, it’s easier that way”.

Problem #2 – You’re out to dinner, and the bill shows up…you ate cheap and everyone else splurged…do you have to split the bill evenly?

Solution – Ask up front, before you even order, “we’re all paying for our own meals and drinks, right?” or ask the waiter for a separate bill. Do not feel obligated to pay for anyone else.

Problem #3 – You raise money for charities and are conerned about asking too often.

Solution – With immediate family it is always acceptable to ask for help. Extended family should only be asked a couple of times a year. Match up a family members interest to the charities (i.e., ask a cat lover for a donation to an animal shelter). With friends, limit your requests to 2-3 times a year. Also, take note of any family and friends that repeatedly turn you down. They might only have a certain amount set aside for charity and prefer to use it on their own charities. They also might be strapped for cash (who isn’t right now) and not have any to spare!

Problem #4 – You lent money to a friend and they missed a payment, and now you see them with something shiny and new!

Solution – You are going to have to have to say something, but be cautious, because the something new could have been a gift, or they could have just gotten a raise and are ready to pay you back. Either way, say “This is bothering me. You missed a payment with me, and now you have that nice new thing. Can we talk about this?” This will either fix the situation, or you learned the hard way that you shouldn’t lend money to friends, and at that point, you need to make it a gift, if you want to preserve the friendship.

Problem #5 – A friend is an accountant, attorney, event planner, computer programmer etc. and you want their advice/help…should you pay them?

Solution – Yes, you should. People assume that their friends and acquaintances go into their chosen profession because they love their work, not for the money, and therefore, it’s okay to ask for free help. It isn’t. If the friend doesn’t bring it up first, you should ask something like “how are we going to take care of the business side of this?” and negotiate from that point, that way, you won’t be surprised when a bill arrives, and your friend won’t feel taken advantage of if you don’t compensate them. If they offer to do it for free, show your appreciation with a gift card to a restaurant or a goody bag of baked goods etc.

Problem #6 – Everyone is “chipping in” for a group gift, and the item chosen is WAY more money then you wanted to spend…should you say something, or just pay what they say you owe?

Solution – If the gift has already been purchased, explain that you had a different gift in mind, and therefore, won’t be able to contribute to the group gift, and go buy something in your price range. If they haven’t decided on a gift, but the one they are thinking about is too expensive, suggest an alternative to the whole group, with a breakdown of each persons monetary responsiblity, and offer to pick it up as well!

Problem #7 – Your friends make more than you do, and they push aside your efforts to pay your own way. You feel like a charity case. What do you do?

Solution – Say “thank you”. Let them pay if they want to, and find ways within your means to thank them. Give them a scrapbook of the trip that you took together. Or make some baked goods at home and give them to the person. Suggest cheaper places to go or potlucks, so that you can contribute your share.

Problem #8 – You’ve made a financial commitment to friends or family, but now you see the cost is outside your budget. What do you do?

Solution – First things first…when you are in the process of making the plans, state upfront what you can and can’t afford, that way there are no misunderstandings. If reservations have been made before you have discussed it, say up front that it was more than you were planning to spend, and you can’t afford it. If you agreed initially, but for some reason, have to back out, you should offer to help with any cancellation fees. If they offer to lend the money, refer to Problem #4 above. It is never a good idea to lend/borrow money from a friend!

Problem #9 – A friend complains about being broke all the time, then you see them with tons of new stuff. What do you do?

Solution – The friend could just be the type to whine about money, or they could be in financial woes. Tell them “you tell me you are broke, but I see you with these new things, are you in financial trouble?”. If they are in financial trouble, help them find help, but don’t get into their business. If they aren’t in financial troubles, then just understand that some people complain about money, and deal with it.

Problem #10 – Someone asks where you got the new shirt you have on and you don’t want to reveal that it’s inexpensive and from a chain store, what do you do?

Solution – You are totally within your right to keep that information to yourself. Just say “oh, it’s so old I can’t remember” unless it’s obvious that it’s new, then say “I did so much shopping that day I can’t remember”.

Problem #11 – You are collecting money for a group gift. The gift has been bought, and now people owe you. What do you do?

Solution – Send out an email, tell everyone you are collecting the money and give a specific date by which you need the money. If there are still some “no pays”, it is absolutely OK to send out another email noting the names of those who have paid with thanks. If you only lack a couple of people, ask them if they sent it to you and you didn’t receive it. don’t be accusatory, as it can cause relational problems. If they’re short on money, accept whatever they can give and move on.

All in all, I was very pleased to see that this article had been written, because too often, situations arise that we just don’t know how to handle. But, as my mom taught me, it’s better to err on the side of caution!

Brief summary: An ad agency in Finland has started running an “evil piggybank” ad encouraging people to spend money, while here in the U.S. we have the “feed the pig” commercials encouraging people to save money.

This article is interesting because it brings up a good point…should I save my money in a down economy, or go spend some to help the economy recover? Well, I say save what you can. Here’s why…

The Finns are trying to stimulate their economy by having their citizens spend all they can, but that is part of what got us Americans in trouble in the first place. We didn’t save, we just saw what we wanted (instant gratification) and bought it, usually on credit. This is proven by the fact that 2 years ago Americans were spending 2% more than they were earning…that’s right, we were saving NEGATIVE 2% of our incomes…awesome, huh? That figure has jumped to POSITIVE 2.5%, but that still isn’t enough.

I love that the feedthepig.org organization is trying to encourage people to save…I think it is exactly what we need to be doing right now, and so does the expert from the article, Kent Smetters. Smetters says we should be saving about 10% of our incomes, and Jerrill and I agree with that percentage, as long as the person has the added protection of an emergency fund of at least 3 months expenses ($1000 emergency fund to get started).

So, you might be asking yourself why in a time of economic downturn do we think you should be saving money? Well, we figure it’s covered. Think about it…you still buy your groceries, pay your electric bill and mortgage payment (hopefully), so the only thing you’ve cut back on are the $6 coffee and designer handbags. Well, the truth of the matter is that if you had to put those items on credit or had to cut back on them first, you probably couldn’t afford them anyway. But that’s OK, not everyone can afford those things. That is the way of the capitalist system…it only guarantees you the opportunity to earn enough to have the finest things, it doesn’t guarantee you the finest things. and don’t worry that no one is out there buying things and stimulating parts of the economy other than groceries and electric bills. There will always be people who can afford to have finer things, and they will by these things even when there are economic woes.

So, save your money. Pay attention to what we say and those Feed the Pig commercials. Don’t pay any attention to the Finnish commercials…we tried over-spending already, and look where it got us!

Brief summary: A survey of nearly 30,000 people revealed some insights into the way people are feeling about the economy and their money. It revealed what they are doing to help tighten the belt on their finances to get by these days.

I love surveys like this one, because it’s kind of like taking the financial temperature of the country.

Page 1 of the article tells how people are spending less on dining out, clothing and recreational activities. I am happy to see that people are refocusing their priorities and are watching what they spend…everyone could save a little more. Where a lot of people get into trouble is eating out and recreational spending. The average American eats out only 1-2 times a week, however, where are they eating? Is the whole family with them? If they eat out at pricey restaurants with the whole family, that can get costly. Even if families are only eating out at McDonald’s 2 times a week, that is probably averaging $20 a trip, or $40 a week. That works out to be $160 a month…that will pay for lots of different things…more groceries, car insurance, health insurance etc.

Page 2 focuses on gift giving. This is a hard topic for me, because I LOVE to give gifts. The survey shows how people are either buying less gifts, or spending less on them. I myself switch to spending less on gifts when funds are tight, and think it is a good way to save cash in your budget. To those people who think they have to skip gift giving because they can’t afford something really nice, I say relax. People like to receive gifts. People REALLY like to receive gift cards! And, for the most part, people don’t care how much you spent on the gift/gift card. And if they are disappointed with your gift, it’s on them…you did what you could, and if they truly do care about you, then your gift will be perfect, because it came from you!

I was absolutely elated by page 3, where it was revealed that if given $10,000 dollars, 48% of those answering the survey would put the money in the bank, and 38% would use the money to pay off debts. All I have to say to this is this…I am excessively happy that people are finally taking notice that they are not saving enough, and I hope that when the economy recovers, they continue to save and don’t go back to their over-spending, have it now ways.

Page 4 deals with something that I don’t really do very well…cutting coupons. Those of you who cut coupons every week, I applaud you, but I have never been like you. I have tried to clip coupons and use them at the grocery, but it doesn’t work for us. We use a lot of generic products, and those products never have coupons in the paper, usually (not always) because the generic is cheaper than the name brand item with the coupon. So, coupons have never really worked for me, but, my mother swears by them! So, apparently do 64% of the respondents (combination of those who have always used them and those new to clipping coupons) to the survey, thanks to the economy. I am excited to see this as groceries are one of the easiest places to cut costs, but one that some people never put the effort into.

Page 5 reveals the how people feel about the economy (well, of the opinions of the respondents anyway). Overall, 47% of the respondents say the economy hasn’t affected their long term plans and 34% think there will be an economic upswing in a year. While I hope that is the case, I worry that the economy has not completely bottomed out yet, and therefore, might take a little longer to come back. Also, our economy is tied to other economies, so we have to watch the financial happenings in other countries (like China) to get some idea of what will happen in our economy. However, I hope those who see an upswing in a year are correct!

So, in my opinion, based on this survey, the financial temperature of the economy is sickly, but people are getting by. They simply need to remember how their parents did things when they were kids…do you remember your parents using layaway? there is a reason for that. You remember them saving up to put a down payment on a car or a house? There is a reason for that. It was the RIGHT way to do things, and according to the survey, some people are finally starting to remember/take notice.

Gallop poll resource – http://books.google.com/books?id=WOug0pzW6_IC&pg=PA481&lpg=PA481&dq=average+number+of+eating+out+per+week&source=bl&ots=b2_ny9ni7M&sig=weev3bzrbR1J6iZj-3Ii9fyP52M&hl=en&ei=-uPMSYnlHpKNtgfc1vTfCQ&sa=X&oi=book_result&resnum=3&ct=result

Today’s topic is “States: We’ll take stimulus – our way” from CNN Money.com

Find the article at: http://money.cnn.com/2009/03/20/news/economy/stimulus_waivers/index.htm

Brief summary: Some states are requesting that the government allow them to use their portion of the stimulus money for things other than what the government allocated it, and some are refusing to take portions of the stimulus money.

Okay, so first things first…I have to go on record that I love the idea that some states are refusing to take all the stimulus package money. That is what they SHOULD be doing. Just because the federal government says you can have some money for a particular part of your states budget does not mean that you should take it. These states are conerned that if they take money for certain projects now they will not be able to maintain them after the federal money runs out. They are correct, and for some reason, nobody seems to be talking about this. This is how the country got into some of its financial problems in the first place…borrowing to cover shortfalls, and when you can’t borrow anymore, then what? Think about the problems that will crop up for the states that do start these projects. For example, they start a program for fine arts, and they get 100 people a job on this fine arts stimulus money, which runs out in 2 years…what then? The state more than likely will not have the money to continue to fund the program, so those people are out of work again…and if this happens in 30-40 states, pretty much all at once, well, then we have another unemployment crisis! Better for those people to find a job in the private sector, and the state government not to owe the government for the program. You see, it’s a band-aid…it doesn’t actually solve the problem. These states need to remember that once the federal money dries up, they have to go back to their regualar budget, which could be quite a shock if they don’t plan ahead!

Nevada is rejecting the money the government is sending them for unemployment, because of the provisions in the bill regarding how to qualify for that money. The state government has to change the regulations on unemployment to include part time employees. That means part time employees will be eligible for unemployment benefits, but Nevada (along with other states) don’t believe the businesses that operate within their borders will be able to pay the additional costs associated with covering the ex part time employees. Well, Nevada and those states are correct. Once that money runs out, those rules and regulations will still be in place, and companies will go belly up trying to cover unemployment benefits for part time employees! That’s just what we need…people need work, and companies will have to close their doors because they can’t pay the unemployment insurance!

So, it’s my opinion that a lot of states are going to take all of this money and spend it according to the rules in place by the federal government. Overall, I’d say this is a bad idea. I applaud those states who remember that they retain their sovreighty (yes, they did) and can choose what taxpayer help they do and don’t want from the government. I worry that after a couple of years when this money has run out, that we as a nation will plunge deeper into a recession. So, check out the article and tell us what you think. I look forwar to hearing your comments!