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February 18, 2008

Comments Broken – Now Fixed

Written by Dogberry
Filed Under: Personal Finance

Thanks to a reader, Leigh, I have now fixed the ability to leave comments again. Somehow the Math Comment Spam Protection plugin was blocking all comments from non-registered reader. At first I could not figure out what the problem was because I could leave comments. It was not until I logged out and tried to leave a comment as a ‘regular’ reader that I was able to reproduce the error.

I removed the plugin and now comments are working again for everyone.

Thanks Leigh!


February 14, 2008

No Recession According to Treasury and Fed Heads

Filed Under: Economy

[CNNMoney.com](http://money.cnn.com/2008/02/14/news/economy/bernanke_paulson/index.htm?section=money_topstories) reports that Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke both acknowledged problems with the U.S. economy but that the recent series of interest rate cuts and the forthcoming economic-stimulus tax rebates will keep the economy out of a recession this year.

We can only hope.


FREE: 274 page Suze Orman eBook

Filed Under: Books

::iimageright(“OrmanWomenMoney.jpg”,”Women and Money”)::

Today, February 14th, Only! Until 8pm Eastern time, Oprah is offering a [free e-copy](http://www2.oprah.com/tows/pastshows/200802/tows_past_20080213.jhtml) of best-selling author Suze Orman’s 274 page book, ::amazon(“0385519311″,”Women & Money: Owning the Power to Control Your Destiny”)::. The book is available in English or Spanish.

From the first chapter:
> I never thought I’d write a book about money just for women. I never thought it was necessary. So then why am I doing just that in my eighth book? And why now? Let me explain. All my previous books were written with the belief that gender is not a factor on any level in mastering the nuts and bolts of smart financial management. Women can invest, save, and handle debt just as well and skillfully as any man. I still believe that–why would anyone think differently? So imagine my surprise when I learned that some of the people closest to me in my life were in the dark about their own finances. Clueless. Or, in some cases, willfully resisting doing what they knew needed to be done. I’m talking about smart, competent, accomplished women who present a face to the world that is pure confidence and capability. Do you mean to tell me that I, Suze Orman, who make my living solving the financial problems of total strangers, couldn’t spot the trouble brewing so close to home? I don’t think I’m blind; I just think that these women became very, very good at hiding their troubles from me.Why not? They had years of practice hiding them from themselves.

Chapters:

1. FOR WOMEN ONLY
2. IMAGINE WHAT’S POSSIBLE
3. NO SHAME, NO BLAME
4. YOU ARE NOT ON SALE
5. THE 8 QUALITIES OF A WEALTHY WOMAN
6. THE SAVE YOURSELF PLAN
7. THE COMMITMENTS
8. SAY YOUR NAME

Go get it!

::HatTip(“http://www.myopenwallet.net/2008/02/free-download-of-suze-ormans-women.html”,”My Open Wallet”)::


$300 to $600 Variable Economic Stimulus Calculation

Filed Under: Taxes

::iimageright(“TaxPig.gif”,”Tax Savings”)::

Up to this point it appeared that you would either receive $300 or $600 (double for married) as part of the economic stimulus plan. $300 if you owed no taxes, $600 if you did. According to the fact sheet just released by the IRS, ([FS-2008-15](http://www.irs.gov/newsroom/article/0,,id=179095,00.html)) this is not the case.

The fact sheet gives examples of how the economic stimulus rebate will work. The only folks getting the full $600 will be those who paid at least $600 in taxes. It appears the only thing that will not offset this $600 is the child tax credit.

So, a married couple within the income limits who owe $1500 in taxes before applying the child tax credit would receive a $1200 rebate plus $300 for each kid under 17. If they only owe $700 then they will only receive $700 plus $300 per kid. If they are lucky enough to only owe $200 then they will still receive $600 (wealth redistribution factor).

So, with 4 kids under 17 I will receive $1200 plus at least $600 and possibly $1200 since the the child tax credit ($4,000) does not reduce the calculation for this rebate.


February 9, 2008

Tax Stimulus vs. Smart Money

Filed Under: Taxes

::iimageright(“money.jpg”,”Money”)::

Looks like the economic stimulus package is just waiting for the President’s signature to go into effect. Details of the tax rebates will still be worked out but if you qualify, single tax filers can receive rebates of as much as $600. Joint filers can receive rebates of up to $1,200. In addition, each dependent child under 17 can add another $300.

Those who have incomes of at least $3,000 but owe no income taxes because of credits and deductions only get $300 if single or $600 if filing joint. If you have a modest income, but have 4 children you get $1000 per kid for the child tax credit this year. I can see having to try to figure out how to not claim some deductions so a person can at least owe $1 in tax!

The feds want you to spend this money to stimulate the economy. I would rather stimulate my bottom line. My question is, what are you going to do with your ‘free money’? Are you going to go out and buy a new refridgerator and stimulate the economy or are you going to do the smart thing and either pay off a credit card or sock the money away into savings?


February 8, 2008

Extended Warranty – Deal or No Deal?

Written by Dogberry
Filed Under: Personal Finance,Saving Money

::iimageright(“Warranty.jpg”.”Extended Warranty”)::

If you’ve bought anything electronic from a chain store like Best Buy, Circuit City, Staples, etc, you were asked (repeatedly) to purchase an “extended warranty”, aka a service agreement, service contract, or maintenance agreement. Hopefully you declined but if not, or are tempted to do so in the future, there are some disturbing facts that every knowledgeable consumer should know.

Retailers forcefully encourage you to buy these extended warranties because they are cash cows. Stores keep 50 percent or more of what they charge for these warranties. They make a better profit on the warranties than they do selling the actual product.
Consumer Reports feels so strongly that extended warranties are a bad deal and that consumers are being misled about them that in 2005 they took out a full-page ad in USA Today to warn shoppers.

Extended warranties are notoriously bad deals for the consumer since most electronics either will fail early, while still under the manufacturers warranty, or will have a long life, living well beyond the extended warranty period.
If the product does fail, the repairs normally cost about the same as what was paid for the extended warranty.

Should your item break while covered by the service plan, you have no leverage with the repair company since you have already ‘paid’ for the service.

Not only will you probably have to wait for it to be fixed but you will not be the one who determines how it gets fixed or who does the fixing.

Extended warranties are not only are a waste of money, when you do need to use them they just add to your frustrations.

Some alternatives you may want to investigate:

*Check your credit card.*
Find out if your credit card provides similar coverage. Most gold and platinum cards typically lengthen the original manufacturer’s warranty by as much as one year.

*Compare what the retailers offer.*
Some retailers might extend the warranty. Costco no longer has their ‘replacement for life’ policy but require most of their suppliers to extend the manufacturer’s warranty to 2 years from the date of purchase.

*Shop around.*
If you feel you must buy the extended warranty, do some comparison shopping. Not only do extended warranties vary in length and terms, you can always attempt to negotiate a better price.

You can pity the salesperson who is trying to sell you a warranty. Their job performance is measured on how many extended warranties they sell. If they do not meet their quota, they could loose their job. But that is a reason to feel sorry for them, not a reason to buy the warranty.


February 5, 2008

Card Games – Credit Card Companies Tighten Up

Filed Under: App-o-Rama,Credit Cards

::iimageright(“CreditCards.jpg”,”Credit Cards”)::

According to an article today in the [Wall Street Journal](http://online.wsj.com/article_email/SB120217434152042887-lMyQjAxMDI4MDAyNTEwNzU0Wj.html), credit card companies have begun to tighten up their credit card offers. Some companies, like Citigroup are requiring higher credit scores, some are lowering the credit lines they offer.

These stricter rules are more than likely due to the poor earnings the companies have had recently — I am guessing that a person who can’t pay their mortgage also can’t pay their credit card bill. Until the economy turns around this trend will probably continue.

It was interesting that J.P. Morgan Chase mentions that they are cutting back on promotional offers to “gamers”, folks who transfer balances frequently or take advantage of low-rate offers. Guess they are not wanting to play the App-O-Rama game.


February 4, 2008

Gospel of Prosperity – Televangelists of Finance

Written by Dogberry
Filed Under: Personal Finance

::iimageright(“FlyingDollar.gif”,”Flying Dollar”)::

Televangelists and financial gurus on TV have much in common.
Many TV preachers promise their audience wealth and prosperity if they will follow their directions and send in a love gift to support their business ministry. These TV preachers can be entertaining, but actually following their advice not only will lighten your wallet but may also endanger your eternal soul. The televangelists of finance may not affect your soul but they put your finances in similar jeopardy.

The people who need help also do not realize the discipline it takes to become financially fit. They see the athlete and wish they had the talent, not realizing that even with the talent they would not have the discipline to shape the talent. Instead they are looking for the quick fix and there is always someone who has a system that can bring instant riches. The Apostle Paul [spoke](http://www.biblegateway.com/passage/?search=2%20timothy%204:3-4&version=47) of “those who:

> “will not endure sound teaching, but having itching ears they will accumulate for themselves teachers to suit their own passions.”

Both financial and spiritual gurus sell the benefits of following their systems to those who will listen, to those who can afford it the least. People fall for their message because they realize their need help and the message comes across as authoritative. They think that those who have money are “the lucky ones” and are willing to gamble whatever it takes to become lucky themselves.

Because this is what people want to hear, financial gurus in both broadcast and print medias must pander to their audience. Headlines to buy or sell hot stocks bring in readers looking for a quick buck, and readers bring in advertisers. It would be way too boring if these gurus told you to “Buy and Hold”, “Invest for the Long Term”, and recommended indexed mutual funds month after month. How many months in a row could the pundit make such financially sound recommendations before they are let go.

Following most of the pundits on TV or in magazines, while exciting, will endanger your financial well being in the same way that watching televangelists endangers your spiritual well being.


Financial Fitness Checkup

Written by Dogberry
Filed Under: Personal Finance

::iimageright(“checklist.jpg”,”Financial Checklist”)::

I have let my finances slide for almost a year. In an effort to get back on track I have created a checklist of items I need to work on to get back on track to being financially fit. Right now I am not sure if I could check any of these items off my list. I will work on each of these items and report my progress as I go.

- True/False – I have a well organized record keeping system
- True/False – I am monitoring the progress of my financial net worth
- True/False – I have written out my short-term and long-term financial goals
- True/False – I am living within my means
- True/False – I have no credit card debt or other short term debt
- True/False – I am saving at least 10% of my income
- True/False – I have six months of living expenses set aside for financial emergency
- True/False – I have an up-to-date will


February 3, 2008

Financial Fitness – Invest in Yourself

Written by Dogberry
Filed Under: Personal Finance

::iimageright(“FinancialFitness.jpg”,”Financial Fitness”)::

Each of us needs to be living within our means. Not only that, we need to be saving at least 10% of what we earn. This savings is not for future purchases either but for investing. Investing for your future. This money earns you money and someday the amount of money you have invested will earn you enough to live on. So instead of having to work each day, your money works for you.

If you are not doing it, saving 10% may sound impossible. But people who make $30,000 a year sometimes find it easier to save than those who make $90,000. We all have the capability to spend all (or more) of what we earn. It takes discipline to save 10% of everything you earn. Make a commitment to yourself, now, to save 10% of your income.

Failing to live within your means does to your financial fitness what overeating does to your physical fitness. Failure to save 10% is the equivalent of not exercising. As the years go by the lack of fitness makes getting in shape more difficult. The earlier you start and more diligent you are the better shape you will be in when you hit retirement.


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