Friday, April 29, 2011

The 30 Year Mortgage Is The Biggest Financial Mistake You Will Ever Make

What makes the standard 30 year mortgage the norm for purchasing a home? The answer is if we didn't have the 30 year mortgage most people would not be able to afford the home they are in. The 30 year mortgage allows them to qualify and have an affordable payment. Affordable being a relative term. 

How it normally goes is that you find your dream house, you need to apply for a mortgage of $200,000. The rates are at 5%. You look into the payment on a 15 year mortgage and it is $1581 a month. You could probably swing it, but your hesitant. Your mortgage broker says you can get a 30 year mortgage and the payment would be only $1073. Yes, a $500 savings. You could really use that $500 for a lot of other things. It's temping and you decide on the 30 year. Bam. You just made the biggest mistake of your life.

By taking the 30 year mortgage, over the 30 years, you will of paid $100,000 more to the bank in interest. For that $200,000 house you will have given the bank $386,511. If you had a 15 year mortgage, you will only have to give the bank $284,685 over a 15 year period. What could you do with that $100,000 if you could of kept it in your pocket. What things were you not able to do because you gave all that money away? I have an alternative.

The 30 Year Home and Retirement Plan.

Start with the same $200,000 house purchase. Apply for the 15 year mortgage. Make the payments and pay off your house in 15 years. It's doable. Fifteen years will fly by and you will have a paid off house. Now your living in a paid off house, right? Take the same house payment and invest it every month. Put it in a stock and bond mutual fund or ETF's. Do this monthly investment for 15 years. Your writing checks as if you were paying on a 30 year mortgage. But now you are paying yourself.

If your investments grow at a rate of only 8%, which is a conservative percentage, at the end of 15 years your investment balance will be $547,089. Next step quit your job and retire. Your house is paid off and you have more than a half million dollars in the bank. If you wish to continue working 5 more years, continue with the plan and continue to make the monthly investment. At the end of the 20th year your balance will be $931,246. Almost one million dollars, now please retire.

"The 30 Year Home and Retirement Plan" will take planning and discipline on your part. It's a long term plan that will take good budgeting and sharp planning. The heart of the plan is the 15 year mortgage. The hardest part will be your determination to have a 15 year mortgage. It's so tempting to get a 30 year mortgage. I can hear the reasons for having a 30 year. I have heard all the excuses. With a 30 you have a lower payment and more cash flow to do other things in life. You may claim you will pay of the 30 off in 15 years. You just want the leeway in case some trouble comes down the road. The best thing about a 15 year mortgage is that it always pays off in 15 years.

The ground rules for this plan to work is you need to purchase a home that is affordable to you. It must not be so pricey that the payment makes you house poor. What is an affordable payment? The rule of thumb is only purchase a home where the payment is 25% of your income. If you earn $4000 a month, then largest house payment you can afford is $1000.

It's your choice. Make payments for 30 years to the bank or make payments for your home and to your future.

Wednesday, April 27, 2011

Betterment Review: Making Investing Easy For The Rest Of Us.

Image representing Betterment as depicted in C...Image via CrunchBaseBetterment is an easy way for the new investor to get started saving for retirement. All of us know that investing in equities is one of the best ways to prepare for retirement and future goals like college or purchasing a home. The problem is, it's hard to get started investing because you don't know what investments are the right ones. Your choices consist of stocks, bonds, mutual funds, and ETF's. Who knows what to pick? Even if you knew what to invest in, what percentages in each investment is appropriate.

Betterment solves all those problems. You pick how much you want to invest in stocks and how much you want to invest in Treasury bonds. If you don't know what to pick, Betterment helps you choose with recommendations depending on your goals and age. Signing up is quit and easy. You have a dashboard where you can set up automatic deposits. You link your Betterment account with your bank. Transferring money in or out of your account is available at any time with no fees involved.

Click Here to open an account at Betterment

What does Betterment invest my money in?

Your money is invested in a stock market portfolio made up of ETFs that reflect the broad US market, which allows you to invest in literally thousands of companies all at once. Currently the Stock Market basket is made up of the following of ETFs:

  • 20% Vanguard Total Stock Market 
  • 20% iShares S&P 500 Value Index 
  • 20% iShares S&P 1000 Value Index 
  • 15% iShares Russell 2000 Value Index 
  • 15% iShares Russell Midcap Value Index 
  • 10% DIAMONDS Trust Series 1 

Why these investments?

Individual stocks are very risky, but they deliver a higher overall return. Some stocks don't do so well. The trick is picking the winners. Most professional stock pickers don't always get it right. For the new investor, it's extremely difficult to be successful. Over the last 80 years the US stock market has returned about 9.4% per year on average. The key to long term stock investing is diversification. Betterment's portfolio represents the total US stock market, so it's like owning a little piece of every company in America. This spreads risk and reward over a broad number of companies.

Betterment also invests your money in Treasury bond ETFs that are lower-risk and steadier-earning than most other investments. They consist of:

  • 50% iShares Barclays TIPS Bond Fund 
  • 50% iShares Barclays 1-3 Year Treasury Bond Fund

With this simple combination of stocks and bonds your portfolio is ready to go. With these few investments Betterment gives you abroad diversification.

What's this going to cost me?

The fee structure is very simple. There is an annual 0.95 fee prorated over the four quarters of the year, 0.225% a quarter. There is no other charges. There are no transaction fees, no deposit fees, no withdrawal fees, no rebalance fees, no maintenance fees, and no other hidden fees.

Why do I like Betterment?

  • They pick all the investments.
  • The fee structure is dead simple.
  • You can move your money in and out when ever you like. It's linked to you checking account.
  • Your account is automatically rebalanced when it drifts by 5%.
  • Betterment is a Registered Investment Advisor with the SEC and they’re SIPC insured.
  • No minimum balance to sign up.

Here is a link to the free Betterment Demo Page.

Why trust my money to Betterment?

Betterment is an SEC Registered Investment Advisor, and Betterment Securities is a broker-dealer regulated by FINRA and the SEC. The securities in your account are protected up to $500,000 by SIPC. Betterment is simple and transparent. Your money is invested in well-established funds, chosen for their good management, efficiency, and long track records.

Who will benefit from Betterment?

If you are brand new to investing, without a clue of what to do, or where to get started, this is for you. They take care of it all. At Betterment you will finally have an easy way to get your feet wet in investing.

Tuesday, April 26, 2011

It's Time To Cut Costs And Save Money, Here's How

Ten-dollar bill obverse/reverseImage by LividFiction via FlickrIt's getting tough out there. Most all my bills are going up. My car insurance bill has been sneaking up. I just changed companies and will be saving $50 per month, locked in for a year. It's a challenge to find ways to save that hard earned dollar.

Save Electric

  • Boil your water in the microwave instead of on the stove. If you use the stove make sure to cover the pots to not lose the heat and use the appropriate size burners. Your saving 60 percent of your energy using a microwave.
  • Pack your freezer with food because it's easier to keep it frozen when there are more items in there. If you don't have the items, using a bag of ice will do the same thing. Your freezer will run less and save electric.
  • In the winter lower the thermostat. Each degree lower you set it will save you 3 percent on your heating bills. Water filled air retains heat better so place pans of water near the heat registers to add moisture to the air.

Save Water

  • Save water on every flush by adding a gallon or half gallon container of water to the flush tank. The savings can really add up the more toilets you have.
  • Collect your rain water to water your garden. You can make your own with a plastic garbage can.
  • Fix that leaky faucet or toilet. Just six drops per minute will waste over 6,428 gallons of water per year.
  • Shower faster. A 15 minute shower per day costs $310 per year. Cut that shower by 5 minutes and save an easy $100 per year.

Save In the garden

  • At your home improvement store buy torn or ripped bag goods. They always mark down damaged mulch and fertilizer bags. Go at the end of the weekend to find the greatest selection.
  • Also wilted or mishapped plants can be picked up for a song here also.

Save With Your computer

  • Save on printer ink by using the Century Gothic Font which consumes 1/3 less ink when printed. That could save up to the cost of one printer cartridge per year.
  • Have your computer plugged into a electrical strip and switch it off when you shut down. It's sucking that phantom power even when it's off. Set your monitor to shut off after 5 minutes of being idle. It's easily wakes up when move your mouse.

Get organized

  • Organized homes go hand in hand with saving money. Extra books or text books will fetch a few dollars. Sell them on or Or try or
  • Sell your old furniture on or give it away to
  • Donate your your unused household item to Goodwill or other worthy services. Make sure to get that donation receipt to use on next years taxes. Keep track of those donations at

There are many ways to save and earn a little money. We need it more than ever in this economy.

What ways can you add to this list ?

Monday, April 25, 2011

Basic Social Security Questions Answered

Seal of the United States Social Security Admi...Image via WikipediaI am still in my mid-fifties but like always continually researching and planning for the future. Social Security being a big part of that I dug up some basic questions that needed answers.

1. I am about to turn 62 and plan to file for Social Security. How do I get started?

You should apply three months before you want to start collecting. Sign up online or call 1-800-772-1213. Here are some documents you may have to produce: your Social Security card or a record of the number; your birth certificate; proof of U.S. citizenship or lawful alien status; military discharge papers if you served before 1968; and last year's W-2 tax form or tax return if you're self-employed.

2. How is my Social Security benefit calculated?

Benefits are based on the amount of money you earned during your lifetime – with an emphasis on the 35 years in which you earned the most. Plus, lower-paid workers get a bigger percentage of their preretirement income than higher-paid workers. In 2010, the average monthly benefit for retirees is $1,172.

3. If I remarry, can I still collect Social Security benefits based on my deceased first husband's record?

You can — subject to several rules. In general, you cannot receive survivor benefits if you remarry before age 60 unless that marriage ends, too, whether by annulment, divorce or death of your new husband. If you remarry after age 60 (50 if disabled), you can still collect benefits on your former spouse's record. After you reach 62, you may get retirement benefits on the record of your new spouse if they are higher.

4. Why won't retirees get a cost-of-living adjustment for 2011? Many of us count on this for food, medicine and other bills.

COLAs are based on the consumer price index, which tracks inflation. Because inflation has been flat, according to the CPI, there will be no benefit increase — for the second year in a row.

5. I am 56 and receive Social Security disability benefits. At what point will I switch to regular Social Security? Will the monthly amount change?

When you reach full retirement age, your disability benefits will automatically convert to retirement benefits. The amount will remain the same.

6. My husband and I are getting a divorce. He wants the settlement agreement to say I will not get his Social Security benefits. Can he do that?

No, he has no control over your future benefits. You can qualify for a divorced spouse's benefits if you were married at least 10 years, are now unmarried, are 62 or older, and if any benefit from your own work record would be less than the divorced spouse's benefit.

7. I have a pension from the Army. Will that affect my Social Security benefits?

It will not. You can get both your Social Security benefits and your military pension. If you served in the military before 1957, you did not pay Social Security taxes, but you will receive special credit for some of that service. Special credits also are available to people who served from 1957 to 1967 and from 1968 to 2001.

8. I didn't work enough to qualify for Social Security. My husband gets it, but he is ill and may not live much longer. Will I be able to collect benefits?

Yes, but your benefit will depend on your age and situation: If you are at full retirement age or older, you'll get 100 percent of your deceased husband's benefit. A widow or widower between 60 and full retirement age receives a reduced benefit.

9. Is it true that some people are collecting Social Security benefits who never paid into the system?

Social Security is an earned benefit. In order to collect a retirement benefit, a worker must pay into the system for at least 10 years. In some cases, nonworking family members, such as a spouse, may be eligible for benefits based on the worker's record. Tough rules in place assure that only legal residents can collect Social Security benefits.

10. I filed for Chapter 13 bankruptcy after being laid off. Do Social Security benefits count as income in bankruptcy, or are they protected?

Your benefits are protected. Social Security is excluded from the calculation of disposable income when setting up a debtor repayment plan.

11. My husband died recently. Can I choose between my own benefit and that as a widow? Can I collect both?

Eligibility for a widow's benefit begins at age 60, or 50 if you are disabled. If you are full retirement age, your survivor benefit will be 100 percent of his benefit; if you take it early, the amount will be reduced. You can switch to your own benefit as early as 62. In any event, you can only get one benefit, whichever is higher.

12. My husband died recently. Can I choose between my own benefit and that as a widow? Can I collect both?

Eligibility for a widow's benefit begins at age 60, or 50 if you are disabled. If you are full retirement age, your survivor benefit will be 100 percent of his benefit; if you take it early, the amount will be reduced. You can switch to your own benefit as early as 62. In any event, you can only get one benefit, whichever is higher.

13. I began drawing Social Security at age 62 in 2006, but I'm still working. Since I'm still paying Social Security taxes, will my benefits increase?

If your latest work years are among your highest-earning years, the SSA refigures your benefit and pays you any increase due. This is automatic, with new benefits starting in December of the following year.

14. My wife is 62 and collects Social Security based on her own work record. Can she receive spousal benefits based on my record when I retire in a few years?

If she is eligible for both benefits, yours and hers, Social Security will pay her own benefits first. If she is due additional benefits, she will get a combination of benefits equaling the higher spousal benefit.

15. If I retire to a foreign country, can I have my Social Security benefits sent there?
If you are a U.S. citizen, you may receive your benefits in most foreign countries, usually by check or direct deposit. If you are not a U.S. citizen, the answer is more complicated, with certain rules applying to certain countries. For specifics, see the Social Security publication "Your Payments While You Are Outside the United States."

16. I started collecting Social Security at 62. I heard that if I changed my mind, I could pay back the amount I'd collected and get a higher payment. Is that possible?

That used to be true, but the Social Security Administration just published new regulations that curtail this option. Now, if you want to suspend your benefits, you must do so within 12 months after first receiving them. According to Social Security, 85 to 90 percent of beneficiaries who withdraw their applications do so within this time frame anyway. The new rules, which became effective Dec. 8, also specify that beneficiaries are limited to one refiling in a lifetime.

17. Can I collect Social Security and unemployment compensation at the same time?

Yes. Unemployment benefits aren't counted as wages under Social Security's annual earnings test, so you'd still receive your benefit. However, the amount of your unemployment benefit could be cut if you receive a pension or other retirement income, including Social Security and railroad retirement benefits. Contact your state unemployment office for information on whether your state applies a reduction.

18. I am 63 and collecting Social Security. If I work, will my benefit be cut?

It depends on your income. Between age 62 and the start of the year when you reach full retirement age, $1 in benefits is withheld for every $2 you earn above a limit, which is $14,160 in 2010. In the year you reach full retirement age, $1 is withheld for every $3 above another limit, $37,680 in 2010. In your birthday month, the limits go away — and your benefit will be recalculated upward to compensate for the money that was withheld.

19. I know I can start collecting Social Security at age 62. But should I?

That depends. If you're healthy and can afford it, you should consider waiting until you reach your full retirement age of 66, or even 70. Here's why.

By law, the age when workers can qualify for full benefits is gradually increasing, from 65 to 67. (It will be 67 for anyone born after 1960.) If you claim benefits before reaching full retirement age, they'll be reduced. That's because the goal set by Congress is to pay the same lifetime benefits to an individual regardless of when they're initially claimed.

So let's say you claim benefits at age 62 and get $1,000 a month. If you can wait until you're 66, you'll get at least 33 percent more ($1,333). And if you can wait until you're 70, you'll get at least 75 percent more ($1,750).

Social Security determines the amount of your benefits based, in part, on your highest 35 years of earnings. So you may get a larger monthly benefit if your extra years of work are your top earning years.

Saturday, April 23, 2011

Kids And Having A Rational Easter

Foil wrapped chocolate Easter BunniesImage via WikipediaAre you concerned about the blatant commercialism of Easter? In stores I have noticed that right after our last commercialized holiday of Valentines Day out came the Easter candy and decorations. This concerns me from the view point of children. Even though we send our daughter to a Christian school she still asks about the existence of the Easter Bunny. "Is the Easter bunny real Dad?" she asks me. I see that she has her doubts so I finally let her know there is no Easter bunny. It's quite easy to discredit the notion of an Easter bunny traveling the world distributing Easter baskets to all little children. I bring up the fact the Easter bunny has no way to manufacture or purchase so many Easter baskets. He has no known way of traveling the world to deliver them. And finally has no opposing thumb to even hold a Easter basket. She accepts the explanation, happily.

It's easy for my daughter to accept the misguided Easter bunny story as just a way to get parents to buy candy gifts for their children. I still am not ready to discredit her belief in Santa Claus,yet. I'll be working on that eventually. But I am sure she will figure that one out on her own, I hope.

We have these wonderful religious holidays and they get so cluttered up with the commercialism aspect. We as adults, have the capacity to distinguish the the real from the false. Yet the children don't. It's our job as parents to guide them through this maze of misinformation. On one hand they are not able to comprehend the holidays true meaning but can easily understand the holiday's false meaning. As parents we love to see the child enjoy the false meaning, for the short time as they are growing up. But the day comes when it's time to burst that bubble.

Where is the line of raising your kids to value our religious holidays for their true meaning versus their commercialize meaning? Who do we blame for all this false direction. Maybe we blame the companies who make all this high priced chocolate and candy. What about the stores who sell the candy and decorations. I don't see it as their fault because they are just wanting to take your money for providing a product that you demand.

The answer lies somewhere in the middle. Why is it the chocolate Easter egg or hollow chocolate bunny tastes better during Easter time? It's made of the same ingredients you can have in any Hersey bar all year round. I believe it's all about the experience. As parents we can use the Easter basket traditions as a way to teach our children about the experience of gift giving and gift receiving. There is a certain sense of enjoyment by the receiver of said gift and the good feeling of giving by the giver.

So it's not all about the chocolate after all, and although you may be paying twice the price, many would argue it's a price worth paying. In the years the children are aware of the bunny aspect of Easter we teach our children about giving and receiving. When they grow up we use that lesson to explain the true meaning of Easter. That one person gave his life so that all people could receive eternal life.

Giving and receiving is a foundation of any altruistic society. I think of our society as such. So passing on these traits, to our children, is of utmost importance. Have a Happy and Rational Easter.

Friday, April 22, 2011

25 Tips To Celebrate Earth Day

"The Blue Marble" is a famous photog...Image via WikipediaThis is the 40th anniversary of our annual Earth Day. A day where we promote the sustainability of our land, water, and air through individual and collective efforts. If you remember forty years ago the notion of an Earth Day was thought of as silly. Not today, Earth Day has grown to a worldwide effort to educate and take action on everything concerning the environment.

Earth Day was created as a response to the systematic pollution and disregard for the environment. It was founded by U.S. Senator Gaylord Nelson as an environmental teach-in held on April 22, 1970. Earth Day is celebrated in spring in the Northern Hemisphere and autumn in the Southern Hemisphere. Earth Day Network, a group that wishes to become the coordinator of Earth Day globally, asserts that Earth Day is now observed on April 22 in virtually every country on Earth. World Environment Day, celebrated on June 5 in a different nation every year, is the principal United Nations environmental observance.

The idea behind "Earth Day" is totally a Baby Boomer concept. It's maturity is tied to the generation that brought it to life. As baby boomers age they start to be comfortable with Earth Day's competing values. Earth Day, in effect, also is Boomer Day. It shows the essential conflict between self interest and the public interest. The day reflects Baby Boomer’s conviction that we can have it all if we just tweak and adjust and think much differently about how we integrate manmade and natural systems. Now that it’s completely plain, that the more sensitively we treat the earth, the better off we’ll be in every aspect of our lives. Baby Boomers have the satisfaction of knowing that they were right.

The beauty of being responsible with the environment is that it's so easy to do. It doesn't cost much, it's just an adjustment to your behaviors. Here's a list of things you can do to make an impact on Earth Day and all year.

25 Tips To Do On Earth Day And All Year Round
  1. Lower your thermostat. Buy a programmable thermostat.
  2. Reuse your water bottle. Avoid buying bottled water. In fact, reuse everything at least once, especially plastics.
  3. Check out your bathroom. Use low-flow faucets, showerheads, and toilets.
  4. Start a compost in your back yard.
  5. Buy compact fluorescent light bulbs. You'll find more on energy-efficient products and practices at Energy Star.
  6. Recycle your newspapers.
  7. Car pool.
  8. Go to your local library instead of buying new books.
  9. Get off junk mail lists. GreenDimes can get you started. They’ll even plant a tree for you!
  10. Buy products that use recyclable materials whenever possible.
  11. If you use plastic grocery bags, recycle them for doggie poop bags or for small trashcan liners.
  12. Bring your own bags to the grocery store. Given a choice between plastic and paper, opt for paper.
  13. If you have a baby, consider using cloth diapers. To sign up for a diaper service to do the dirty work, check out the National Association of Diaper Services.
  14. Consider buying a fuel-efficient car or a hybrid.
  15. Go paperless. Consider reading your newspaper and magazine subscriptions online. Switch to electronic banking and credit card payment, too.
  16. Turn your car off if you’re going to be idle for more than one minute.
  17. Do full loads of laundry and set the rinse cycle to “cold.”
  18. Reuse. Plastic food containers make good crayon and marker holders. Use padded envelops more than once. Buy your toddler or preschooler’s clothes from a thrift shop and give away those that don’t fit to friends. Goodwill or the Salvation Army can help.
  19. Limit the length of your showers. Even better, take a “navy shower,” shutting off the water while soaping up and shampooing.
  20. Don’t run the water when brushing your teeth.
  21. Wash towels after several uses. 
  22. Give away your goods and find new ones at FreeCycle.
  23. Build a greener home.
  24. Go paperless at work. Distribute company information and post company material online.
  25. Eliminate junk mail at work. For no fee, the EcoLogical Mail Coalition will eliminate the junk mail that former employees receive at work.

Today, it's easier than ever to recycle. Many city's distribute recycle bins and have weekly pick up. In your town or county there is a bulk waste disposal site. There are now companies and county sites to bring electronics, computers and TVs to be recycled. Even places for toxic items like paints, chemicals and fluorescent bulbs. We have no excuse anymore for not recycling. Do your part on Earth Day and all year round.

Thursday, April 21, 2011

Discover More Card Review & 24 Month 0% Promotional Balance Transfer

Discover More Card: No Annual Fee, Great Cash Back Rewards & 24 month 0% Balance Transfer

The Discover More card is one of Discovers more interesting cards. I have always used Chase and Citi credit cards before now. Discover has always been an odd card to me. It's wasn't taken every where so I just passed it by for the more popular Visa or Mastercard. I came across this incredible balance transfer offer so I dug a little bit deeper to see what Discover has to offer. These benefits I discovered made the card very interesting.

5% cashback on up to $400 in purchases.
  • Jan–Mar Travel and Restaurants
  • Apr–Jun Home and Fashion
  • Jul–Sep Gas, Hotels, Movies and Theme Parks
  • Oct–Dec Restaurants and Fashion
Of course you have to sign up each time to receive the cashback.

You can also earn up to 1% unlimited Cashback bonus on every purchase you make outside those seasonal purchasing categories. You'll earn .25% Cashback bonus on every purchase you make until your yearly spending total reaches $3,000 dollars. After that, you'll earn 1% Cashback bonus. You'll earn between 5% and 20% Cashback bonus when you shop at over 150 online retailers through, Discover's online shopping mall. There's no limit to the amount of Cashback bonuses you can accrue, and these bonuses never expire as long as your account is active and current!

The Discover® More Card - 24 Month Promotional Balance Transfer offer lets you redeem your Cashback bonus rewards for merchandise, gift cards from hundreds of name-brand retailers, Discover gift cards that are good anywhere Discover is accepted, and even cash. You can have your Cashback bonus rewards redeemed for direct deposits to a bank account of your choice or directly credited to your Discover card statement.

On top of these excellent features, you'll never be charged an Annual Fee for the Discover® More Card. You can access your account securely online anytime day or night, and customer service is available whenever you need it. The Discover® More Card - 24 Month Promotional Balance Transfer offer is an excellent choice if you're looking for a cash rewards card, a very long 0% Introductory APR on balance transfers, 0% Introductory APR on purchases, or all three!

Discover Online Mall: What's there?

The Discover Mall has merchants that give 5% to 20% cash back bonuses on purchases, when you perchase your items there. These online merchants are your very best. This is an outstanding group of merchants and the bonuses are very generous.

Merchant included and their % bonus:

  • Apple Store: 5% cashback bonus
  • Best Buy: 5% cashback bonus
  • Groupon: 20% cashback bonus
  • WalMart: 5% cashback bonus
  • Kohl’s: 10% cashback bonus
  • Lowe’s and Home Depot: 5% cashback bonus
  • Target: 5% cashback bonus
  • Meijer: 5% cashback bonus 

That's not all. Look also for Cabela’s, Sears, Dicks, JCPenney,, Old Navy, and Staples. You won't just be getting the normal 1% cash back, you'll be getting much more. During the holidays you will be getting bonus cashback. Some bonuses go from 10% to 20% during the Christmas holidays.

What's the bad news?
Warning if your not responsible with credit cards do not use them. But if you a responsible shopper, paying off your balance every month than this is appropriate for you. These rewards are a nice incentive when shopping, but must be used responsibly.

Also remember that you will only earn .25% on your first $3000 in purchases, if those purchases don't fit into the seasonal category's or are a 5%+ partner.

Discover More Conclusions

The Discover More is definitely one of the best cards for cash back deals. It's links to big name retailers for substantial discounts is a big plus. The 24 month 0% balance transfer is also a huge bonus. I can whole heartily recommend the Discover More card if your a responsible credit card user.

If your interested in this Discover More Card: No Annual Fee, Great Cash Back Rewards & 24 month 0% Balance Transfer click here.

Wednesday, April 20, 2011

Credit card protection: Is it worth it?

Credit cardsImage via WikipediaAre you paying a fee every month for credit card payment protection? It may not be worth it or you could be over paying. Americans are still carrying large credit card debt and they fear if they lose their job or become ill then they won't be able to make their minimum payment. The credit card company will make your minimum payment in these times, for a small monthly fee.

But a new government report shows that the price consumers pay for this debt protection may be too much for the benefits they receive. The Government Accountability Office reports that consumers shelled out about $2.4 billion in 2009 to the nine largest credit card issuers for debt protection products. For every $1 cardholders paid in fees, they received 21 cents of benefits. Meanwhile, the card issuers earned 55 cents, before taxes, on every dollar of fees.

Debt protection products generally promise to suspend monthly minimum payments or cancel balances in the event of an illness, unemployment or the death of the cardholder. Fees are tied to the account balance and can amount to hundreds of dollars a year. At that price, consumers likely are better off paying down their balance or putting the money in an interest-bearing account that can be tapped in an emergency.

Monthly fees, according to the GAO, range from 85 cents to $1.35 for every $100 of debt. On a $5,000 balance, consumers could end up paying $510 to $810 a year.
The irony is that those with high card balances are more likely to be struggling financially. Usually, the people who can afford the least will pay the most.

Credit insurance and debt protection products can safeguard credit ratings when consumers go through tough times, and consumers have lodged few complaints, the GAO notes. Moreover, 70 percent of benefit claims were paid in 2009, according to the GAO study. However, nearly one in four claims were denied, often because consumers didn't provide documentation of their hardship.

Instead of buying debt protection. If you lose a job or suffer some other financial hardship, contact the card company to work out a payment plan.

Some consumers might be tempted to buy debt protection because they worry about dying and leaving loved ones stuck with their credit card debt. But survivors won't be held accountable for the debt unless their names are on the account. If people are worried about leaving behind bills, they should buy life insurance that will cover more than just a credit card debt.

Tuesday, April 19, 2011

The Psychology of Tax Refunds

An example of a cheque.Image via WikipediaTax season is over it's time to relax. You filed your taxes and now waiting to get your refund. If your getting a refund you feel pretty good. The average refund for most Americans is around $3000. In the media and almost every financial blog you will be told this is wrong. They will say you are giving the government an interest free loan. It's true and it does make sense. But someone has an alternative view to this.

Ramit Sethi, author of "I WILL TEACH YOU TO BE RICH", has a different perspective on this idea. He says technically it makes sense to pay the government the least possible. He shoots down the idea that you are losing possible interest income on your money. What's the interest on $3,000 for the year? It comes to $2.50 per month for a total of $30 for the year. He says it's not that much of an impact on your money. Secondly, if you did receive the money in your paycheck you would probably end up spending it.

Ramit says it's a good thing to receive the money back as a lump sum. When you receive money as a lump sum, you tend to spend it more wisely. Americans use the money, on average, to payoff debt or save it. This is the psychology of tax refunds.

It's interesting that in my own experience, I have found this psychology very true. Every year for a quite a while I would receive, a tax refund, between $2000 and $3000. I would plan my budget and I was ready to use this money to payoff debt or I would put it toward my property tax. Like clockwork this went on and still goes on. Ask me if I would have it any other way and I would say, No.

Though not ever created to be a mini savings plan, it has turned out to be that way. I know people use their refunds to buy big screen TV's and other things. But for the most part I agree with Ramit that Americans use their refund to save or pay off large living expenses like I do.

I have followed Ramit for a few years now and notice his philosophy is to make money moves that are usually big. He doesn't believe in the frugal style or your "Latte Factor". He believes in making more money and having that latte when ever you want. I have his book and recommend it all. He puts out there an interesting plan for you finances. He goes against the grain of most money guru's. He preaches mostly on how to increase your income.

I am including one of Ramit's best YouTube videos where he describes how to automate the inflow and outflow of your money. He believes automation is key to a successful financial life. Watch.

Reader: Do you think a tax refund makes sense?

Monday, April 18, 2011

Happy Tax Day Freebies 2011

Ice creamImage via WikipediaTax day freebies are freebies given out by businesses on the day taxes are due, to soften the blow and make the day a little more fun. These tax day freebies can make an otherwise dreary day a little bit brighter.

Tax day freebies 2011 include free Cinnabon bites, free ice cream sundaes at MaggiMoo's, a free workout at Bally Total Fitness, and a free massage from HydroMassage.

1. Free Cinnabon Bites

Stop in on Monday, April 18 from 6:00 p.m. until 8:00 p.m. for this scrumptious tax day freebie called "Tax Day Bites."

Participating Cinnabon bakeries will be handing out two Cinnabon Bites to each customer who stops in.

I recommend calling your local Cinnabon before you head out to make sure they're participating in this tax day freebie.

2. Free Ice Cream Sundaes at MaggieMoo's

Here's a tasty tax day freebie for you! On tax day, Monday, April 18, 2011, you can stop by MaggieMoo's to get a free mini ice cream sundae during their Sundae Stimulus.

The free ice cream sundaes are MaggieMoo's Crumb Cake Fundae which features cinnamon Hostess crumb cake, cinnamon ice cream, caramel, sauce, mixed nuts, and whipped cream.

This tax day freebie will only be given out from 3:00 to 6:00 p.m.

3. Free Workout at Bally Total Fitness

After you've eaten your tax day freebie goodies, some exercise might be a good idea. Stop in on Monday, April 18 and non-members can get a free workout at Bally Total Fitness.

If you're already a member of Bally Total Fitness then they have a tax day freebie for you too. Sign up at your local Bally's and get a free 30 minute personal training session April 15-21.

4. Free Preview of HBO and Cinemax

This tax day freebie will really help you relax and spend some time with the family.

DirecTV, Dish Network, Verizon FIOS, and some Cox Communications customers will be getting a free preview of HBO and Cinemax over tax day weekend - April 15 to April 18.

Check with your provider for more details about this tax day freebie.

5. Free Massage From HydroMassage

After mailing in those taxes you're going to need a relaxing tax day freebie like this free massage from HydroMassage.

Click the link above to find a HydroMassage near you and print out the coupon to get a free massage from April 14-18. They suggest calling ahead to schedule your free massage.

6. Tax Day Cheapies 2011

These aren't tax day freebies but they're some great deals that are being offered on tax day.
  • California Tortilla - Stop in and get an order of free chips and queso with any purchase on April 18.
  • McCormick & Schmick's - They're offering some $10.40 entree specials and tax relief drink specials.
  • P.F. Chang's - Dine-in or carry-out some food at P.F. Chang's on April 18th and you'll get 15% off your food order.

Have Fun.

Sunday, April 17, 2011

Tax Tips As Filing Deadline Arrives

StopwatchImage by wwarby via FlickrWhether you've already filed and are happily awaiting a refund or if you're just getting started with the annual chore, here are some last-minute tax tips.

GOOD NEWS: EXTRA TIME: Thanks to a local holiday in Washington, D.C., the normal April 15 tax filing deadline got moved by three days. This year only, state and federal taxes are due on Monday, April 18. Which means you get an extra weekend to get all that paperwork completed.

NEED HELP? Free tax preparation help is still available for low- and moderate-income individuals and the elderly.
  • Those with annual incomes below $49,000 can get free help at Volunteer Income Tax Assistance sites, some of which are open through April 18.
  • Free IRS tax help is also available to seniors over 60 through the Tax Counseling for the Elderly program.
  • To find the nearest site for either program, call the IRS help line at 800-906-9887 or go to The help line is answered by a live IRS staffer, weekdays from 7 a.m. to 10 p.m.
  • FASTER REFUNDS: The fastest refund route is to electronically file your tax return and request that refunds be direct-deposited to your bank account. Taxpayers who do so can expect their refund in seven to 10 days; those mailing a paper return can expect a refund by mail in eight weeks.
  • To check the status of your IRS refund, call the refund hotline at 800-829-1954 or check online "Where's My Refund?" at
  • There's also a new smartphone application, IRS2Go, that lets you check your refund status and get IRS tax updates. The app is available for Android or Apple devices.
  • NEED AN EXTENSION? If you can't gather your paperwork in time, get a tax-filing extension. But note: You still must pay what you owe by Monday, April 18, or face interest fees and possible penalties.
  • For IRS taxes, an extension is not automatic but requires filing a Form 4868. The extension form is easily filed online using the "FreeFile" program.
  • Those working overseas or serving in the military outside the United States get an automatic two-month extension to file and pay their federal taxes.
  • HOW TO PAY: Never, ever send cash.
  • If you're paying by check, make it payable to: "U.S. Treasury." On the front, include the tax year, tax form number and the first Social Security number shown on your tax form.
  • Do not staple your check to the return.
  • If you're paying by credit or debit card, the IRS offers several options through private providers on its website. The IRS does not charge a fee, but the providers do. Generally, the minimum "convenience fee" is about $3.95.
  • CAN'T PAY? Taxpayers who owe but don't have the funds to pay should contact the IRS to request an "alternative payment" plan. It can be a one-time short-term extension or a longer installment plan. Generally, installment plans are offered if the tax debt is $25,000 or less and can be repaid within five years. Penalties and interest are charged.
  • DON'T MISS OUT: Low-income individuals and families are urged to file for the Earned Income Tax Credit. It's a federal refund, up to a maximum of $5,666, depending on family size.
  • The refund phases out at various income levels; for married couples filing jointly, with three or more kids, the maximum is roughly $48,360.
  • Even if you don't owe taxes, you need to file a return to claim an EITC refund

You still have time to get your taxes done. It won't be easy. Good Luck!

Friday, April 15, 2011

Is It Finally Time To Get Organized?

With tax season almost over it's a great time of year to go through our files and get organized. I have just gotten all my paperwork back from the accountant and i would like to get organized. But what should I keep and what should I throw out?

WhatHow Long to KeepWhy
Tax returns (including receipts and supporting documents)Up to six full yearsThe IRS can audit a return up to three years after you've filed. The agency can challenge your return for up to six years if it suspects you under-reported your income by 25% or more.
IRA contribution recordsPermanentlyKeeping these forms — like IRS Form 5498 and 8606 — may prevent you from paying too much tax when you tap your retirement stash.
Investment and real estate recordsSeven years after you sellThey help track your cost basis — and the taxes you owe when you sell; shred your monthly statements and save the annual summaries.
Bank statements and checksOne month to seven years, depending on whether your bank has them available onlineYou could need them if you're audited by the IRS. If you haven't already, switch to receiving your bank documents online. Your bank may have past statements available online.
Credit card statements and bills for non-deductible itemsShred immediately after the next statement arrivesYou don't need them once you confirm the charges and have proof it was paid.
Form W-2: Wage and Tax StatementUntil you start receiving Social Security benefitsUsually your best proof of earnings for Social Security
Pay stubsUntil the end of the yearNot needed once you get your W-2
Insurance policiesUntil they expire — except for liability policies with "occurrence" coverageOccurrence-based policies cover you for damages that occur while the policy was in effect — even if the claim happens after coverage expires.
ReceiptsDay-to-day debit/credit: Toss after confirming the amount charged is correct.
  • Big-ticket item: Keep with other purchase documentation for proof of value in case of loss or damage.
  • Charitable donations: Store and keep for tax-filing purposes.

Depending on the type, amount and reason for the purchase, they may be necessary for insurance- and tax-filing.

Needless to say keeping documents safe means either a fireproof safe or a safety deposit box. There are many new services that will scan your documents for storage online or on disks. Try - Scan Receipts and Business Cards

Thursday, April 14, 2011

Discover is Offering a Rare 24 Month Promotional Balance Transfer

Over the last few years balance transfers have all but dried up. Only within the last six months I have noticed balance transfers starting to loosen up. I have seen many 6 month transfers and a few 1 year transfers. But never have I seen seen a 24 month transfer, not for many years.

Slowly, 0% APR balance transfer cards have made a comeback. But be sure to read the fine print and know beforehand what the balance transfer fee is going to be. It's usually 3-5%, if it's to much it can defeat the whole purpose.

Updated Bullets:
  • 0% intro APR on balance transfers for 24 months, then the variable  APR of 11.99% - 20.99%
  • 0% intro APR on purchases for 6 months, then the variable APR of 11.99% - 20.99%
  • 5% Cashback Bonus® in categories that change like travel, gas, groceries, restaurants, home improvement stores and more
  • Up to 1% unlimited Cashback Bonus on all other purchases
  • No Annual Fee

Discover® More Card - 24 Month Promotional Balance Transfer

Who is this Discover Card Good For?
If you have a debt that you will need 2 years to pay off this is for you. If your digging out of credit card debt and need a break in the high interest piling up. But the deal is that you actually pay it off to make this work.

What's the Downside?
If you miss a payment you're going to lose your promotional balance. The balance transfer fee is 5%, steep to say the least. But if your transfering $10,000 the 5% comes to $500. Divide over two years it is 2.5% interest on the $10,000. Your paying all your interest up front. Still a good deal. Naturally your credit has to be pretty good to get this offer.

After being approved you have till June 10, 2011 to transfer the balance.

You can apply for the Discover® More Card - 24 Month Promotional Balance Transfer here.

Wednesday, April 13, 2011

9 Ways Avoid to Disreputable Contractors

A carpenter at the TVA's new Douglas dam on th...Image by The Library of Congress via FlickrI have been getting some estimates to change out my windows. They are 35 years old and it's time to upgrade. The new windows today, not only save on energy costs but are are impact resistant. So the need for shutters during a hurricane isn't a worry anymore.

Whenever you have work done of this nature done it will be of great benefit to qualify the company that does it. I recommend doing a thorough checking out of the company and meeting the people who will actually be doing the work. Some of my readers know of my special relationship with building contractors. I am one and I am well aware of how they can be very good in their job and how they can be very bad. So it is very important to check out their credentials and past work.

Seek Referrals. It's best to get it from the horse's mouth. Stop by remodeling jobs that are in progress and talk to the homeowner. Ask if they are happy with the way the job is going. Is the work being done in a timely fashion? Is the crew doing a god job? How is the price? You will know right away if the homeowner likes the work. They will be forth right with a good or bad review.

Check Credentials. Call your local BBB and find out how long a company has been in business. Google the name of the company and it's owner, you will find if there are any problems or lawsuits. Contact any state licensing boards for any consumer complaints.

Seek Referrals. Talk to any friends or family who have done any similar kinds of work. Call your local building department to check if there are any complaints or if they make recommendations.

Ask For Insurance. Ask your contractor to produce documentation of liability insurance and proof of workmen's compensation. See that all paper work is up to date.

Subcontractors. Ask your contractor if they will actually be doing the work or will be sub-contracting the work out. If so check out the subcontractor thoroughly.

Everything must be in writing. Be sure all agreements are put in writing. Ask how work change orders are to be handled. Be sure start and finish dates are in writing. Also payment schedules and detailed description of the work to be done.

Understand what your signing. If your contract has to much small print and is costly maybe a lawyer should check out the contract to see if you are not being taken.

Paying upfront. Don't pay to much upfront. A small deposit may be required but always pay after work is done or on a beneficial for you schedule.

Never Pay in Cash. Use a credit card or write checks so you always have proof of payment.
Contracting work on your home can be a pleasant experience if you take it slow and find the best contractor.

Tuesday, April 12, 2011

How To Freeze Your Credit Report?

Snow on treeImage via WikiPatentsIf you ever thought of freezing your credit report and didn't know how to, I will give you all the info you need to do it. By putting a freeze on your credit report you are restricting new creditors and hopefully identity thieves from being able to access your reports. If you ever decide to lift the freeze, in case you want to access your reports, the process to unfreeze is just as simple. Some states have a small fee to place the freeze, others are free. Free reports are given to senior citizens and victims of identity theft.

There are 3 company's that have your credit report so you will have to contact each individually.

TransUnion Online - Click here.
Experian Online - Click here.
Equifax Online - Click here.

If you have any problems online here are the 800 numbers to call them:

TransUnion: 1-888-909-8872
Experian: 1-888-397-3742
Equifax: 1-800-685-1111

They may try to get you not to freeze your credit report or may try to sell you a credit monitoring plan. Say "no" and state you want a credit freeze. A credit report will insulate you from exposure to identity theft.

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