Friday, February 22, 2008

Not For Profit Debt Help

Getting into financial trouble and debt is easy, but staying out of debt and handling finances well is not as difficult as you may think. It all starts with a good financial plan and learning how to curb the debt you have while not incurring any further debt. You need to take a long, hard look at your current situation and take positive action to change it for the better.

In some cases, you can negotiate better terms with creditors on your own. Unfortunately, when late notices and demands start to roll in, people can panic, make unwise decisions and actually get themselves in deeper than they were. They will do almost anything to stop those collection calls, but it's important that they take the right steps.

If you are in that situation, now is when you need good solid advice and debt help to deal with your bills. Taking effective action can curb interest rates and penalties if you know how to go about it. Find out if debt consolidation is for you and what type of debt-repayment plans are available.

There are lots of companies out there that offer debt services but they are not all equal and some may even be scams. Companies that charge upfront fees or closing fees for debt consolidation may be running a scam or in some cases, charging illegal fees. When looking for debt help, check for companies that say they offer not for profit debt help. Check the Internet for information about the company, ask friends who have used debt management companies and check with the Better Business Bureau to make sure there are no complaints listed against them.

Financial health starts with solid planning, a budget and a determination to stay out of debt and live within your means. But if you get into trouble, there is help available. Be wise in choosing a debt management company and make a plan for your financial future.

IRS Declares Woman Dead

If you have been worrying about filing your taxes, here's one problem you probably don't have to deal with (but perhaps wish you did).

Laura Todd can't file her taxes because the IRS thinks she's dead. Although that sounds like a pretty good situation to be in at tax time to anyone who owes, Laura has found that being dead off and on for the last eight years hasn't been a lot of fun. In fact, it's caused her to have her health insurance cancelled and her tax refunds delayed. Laura isn't really dead - never has been - but due to an error in the Social Security Administration, she keeps going on the rolls of the deceased.

The really disturbing fact revealed in this news story is that in the last two years, the IRS has had to resurrect 23,000 people from the dead, and it is stated that it's impossible for them to tell who is alive and who has passed on.

Friday, February 8, 2008

How to Make a Budget

Creating a budget is the first and most important step to good personal financial planning. Budgeting helps you track where your money comes from, and most importantly, where it's going. In a few easy steps, you can tailor a budget that gives you control over your money and your future.

You can purchase budgeting software if you prefer, but the existing spreadsheet software already available on your computer will produce a good result, so there's no need to incur extra expense. You can also use one of the many budget worksheets available for you to download free on the internet. In a pinch, use a notebook and pencil.

For personal and household budgets, working with a monthly time period is usually best, as most bills come due monthly.

Ready to start? Here we go!


*Income - Collect paystubs, W2s, bank statements and documentation pertaining to any other source of income such as loan proceeds or child support. If your income regularly includes commissions or other variables, taking an average over at least three months is best.

Time to gather up the bills. Rent or mortgage and car payments will remain the same from month to month but for bills that vary depending on usage, such as utilities, take an average. 12 months is optimal, but a three month average should yield a workable number.


Now it's time to plug in the numbers. When listing income, add all sources of income together for your monthly total. It is usually best to use net income, since this is the amount you actually have to spend. List expenses separately by category. The more specific the category, the easier it will be to track each expense. For instance, don't list "Utilities", break it down into phone, electric, etc.

Here is a list of some common categories of expenses. You should add items or delete items on this list as necessary to reflect your personal expenses.

* Rent or Mortgage payments
* Food - don't forget to include eating out and school lunches as well as groceries in this category
* Utilities - Heat, Phone, Electricity, Cable or Satellite TV, Internet service provider, Water and Sewer bills
* Transportation - car payments, fuel, average maintenance costs and insurance premiums
* Clothing - include costs of cleaning as well as purchase of new and replacement items
* Medical - include any insurance premiums that you pay directly, direct payments for medical services, co-pays, prescription drugs, eye exams and eyeglasses or contact lenses
* Entertainment - include expenses like movie tickets, going out with friends or dating
* Miscellaneous - include regular expenses that don't fit into other categories - track all debit card and cash transactions for at least a week for items you purchase at coffee shops and convenience stores, etc.
* Savings

One of the benefits of using a budget is that you may be able to identify unnecessary expenses or adjust some services to reduce bills. Scrutinize each bill for ways to save. Simply canceling premium channels or changing to basic service can pare down that cable bill. Money saved in one category can be transferred to another, such as savings.

Increasing your savings is an important goal of budgeting. Everyone should have three months of expenses saved for emergencies such as job loss or serious illness. After making your budget you will know your savings target for that emergency fund.

Do Not Call Registry Now Permanent

The Do Not Call Registry is now permanent, thanks to the Do Not Call Improvement Act of 2007 that passed Congress this week. Previously, the FTC required that you re-register after five years or they would drop your number from the list. This act makes registration permanent, with no renewal necessary.

Telemarketers are not allowed by law to call consumers who have registered their phone numbers with the Do Not Call Registry and face heavy fines if they do. Signing up will prevent you from receiving calls from telemarketers, solicitors and scammers.

The legislation also requires that the FTC review the Do Not Call list for invalid or disconnected numbers, so that the list stays up-to-date.

If you are signed up for the "Do Not Call" list, you are now permanently registered. If you haven't registered yet, you can do so at the registry website.

Friday, February 1, 2008

Scamsters Increase In Uncertain Market

The North American Securities Administrators Association is warning investors to be more cautious and beware of scammers who proliferate in times of uncertainty in the market. Those nearing retirement are especially at risk for being targeted by scammers.

Scamsters follow the news and often prey on investors’ fear to promote bogus investments with promises of high return and little or no risk,” said NASAA President and North Dakota Securities Commissioner Karen Tyler.

Tyler also said investors nearing retirement are particularly at risk of being targeted by phony investment schemes promising high returns to make up for losses in retirement accounts. “We are concerned that investors may allow uncertainty over current market conditions to lead them into fraudulent investment schemes that could weaken or devastate their financial position, potentially wiping out the retirement security they worked so hard to build. A hasty decision often can make a bad situation worse.”

Tyler gave these recommendations to investors:

* Hang up on aggressive cold callers and delete unsolicited e-mail messages promoting investments opportunities with little or no risk.
* Contact their state or provincial securities regulator to check that both the seller and the investment are licensed and registered. If they aren’t, don’t invest. Contact information is available on the NASAA website here.
* Request written information about any investment; carefully review it or ask your financial adviser to evaluate it.
* Use common sense. Get-rich-quick promises are usually signs of investment fraud.
* If you suspect you’ve been scammed, report it to your state or provincial securities regulator. Your call could help others from losing money.

Tyler also cautioned that financial professionals do not generally advise clients to make changes to investment portfolios in times of market volatility.

Read the press release

How to Teach Kids About Money

Should you force your child to save? You should if you want to teach them fiscal responsibility say the experts.

Just seeing you handling money responsibly isn't enough to teach kids how to handle it themselves. By making them save a portion of every allowance or money they receive, you teach them a lesson about finances and also build a good savings for them that they can use when they go to college.

That concept and other ideas, including how to introduce your children to credit cards is covered in this article, where experts in personal finance discuss ways to make your kids more aware of the right ways to handle money.

It's good reading and full of good, solid advice. I recommend it.