Taxes Going Up As The Bush Tax Cuts Go Down

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There were two major tax cutting bills enacted during President Bush's administration. They were the Economic Growth and Tax Relief Reconciliation Act of 2001 and the Jobs and Growth Tax Relief Reconciliation Act of 2003. These two pieces of legislation are what we call the "Bush Tax Cuts". The bills included across the board tax relief for American taxpayers. They will expire as of December 31, 2010. 
 
Exactly what will the loss of these tax cuts mean to you and me? 
 
Tax Brackets 

Tax brackets that are currently 10%, 15%, 25%, 28%, 33% and 35% will go up to 15%, 28%, 31%, 36% and 39.6%. This means that if you are in the 10% bracket your taxes will increase by half to 15%. What happened to helping the lower and middle class? 
 
Marriage Penalty 
 
Remember when the marriage penalty was such a hot topic in the news, well the Bush Tax Cuts fixed it. But now it's going back to the way it was, when a couple living together was paying less taxes. Married couples will have to pay more than single couples. 
 
Child Tax Credit 
 
The current child tax credit is $1000. This will fall back to $500 in 2011. Also eligible families will decline. 
 
Dividends and Capital Gains 
 
The tax rate on dividends is currently 15%. It will climb to a range of 15% to 39.6%. Capital gains top rate will climb from 15% to 20%. 
 
Estate Tax 
 
In 2010 there is no estate tax. But in 2011 it returns with a exemption of $1,000,000 and a tax bracket of 55% 
 
The Tax Foundation estimated that the median family of four saved about $2,200 in taxes under the present plan. These cuts will vanish with the next tax year. 
 
I can't reconcile any of these tax cuts as unnecessary. They effect all tax payers of every age. I can't see giving the government more of our money when the budget is out of control. When our money is wasted at every turn it unconscionable to allow them more money. Cut the budget 10% and leave us alone. 
 
Not making these tax cuts permanent will be the final nail in the Obama Administration. The damage done will echo for years to come. 

From Mortgage Fraud To Foreclosure Fraud

Image via WikipediaBank of America, the nations largest bank, on Friday became the latest lender to put foreclosures on hold in 23 states because of concerns that court documents it submitted were prepared incorrectly. 
 
A Bank of America executive, Renee Hertzler, said in a February deposition in Massachusetts that she signed as many as 8,000 foreclosure documents a month without reviewing them. Here's the problem with this: an executive of a major lending company, who is responsible for 8,000 foreclosures a month blindly signs legal documents without checking for accuracy. This is only one of the many banks operating in this way. Maybe the documents are accurate, time will tell. 
 
At OneWest in Austin Texas, Erica Johnson-Seck a vice-president and her team sign off on 6,000 documents a week and about 24,000 a month. OneWest is the successors to defunct IndyMac of California. 
 
What's the problem with all this? The banks really don't care if the documents are correct. They don't care because these foreclosures are a big drain on the resources of the bank. The costs of foreclosure and the money lost in the lending is eating away at the companies. They have had to hire additional staff and the light at the end of the tunnel cannot even be seen. 
 
It's not revealed but I believe the people who are really upset about this fiasco is the Judges that have to sign off on the foreclosure. They look like fools taking for granted the documents are correct. 
 
The banks in today's world have really let the industry go to pot. Banks are rated at the bottom in customer service. Just try to get a short sale to progress in a timely manner. The lending that was supposed to loosen up with the TARP bailout has not happen and if it did only in the slightest way. Banks are not lending like they should. The lending they do is in such a way as to be totally useless. 
 
Banks have become a massive, bloated, fat behemoth of in efficiency. They can't even get out of their own way. The time will come when they will have to be broken up like AT&T was. They are unresponsive to the needs of the public in the extreme. The credit system of this country in integral with the health of the economy. If these banks can't get it together Uncle Sam may have to step. Under normal circumstances I'm apposed to government regulation but not in this case. 


       Sorry about the Rant but banks misbehavior is a sore subject with me.
                                                                                                  ,Dave

How to: Go to College Without Loans

There is a new book out called "Debt-Free U: How I Paid For An Outstanding College Education Without Loans, Scholarships, Or Mooching Off My Parents" by Zac Bissonnette. Zac is the new poster child for a debt free college education. I can see he will soon be on all the morning shows hawking his new book. He is presently in a public college and paying cash. 
 
Zac's premise is that if you pick an affordable school, live within your means and work during college, college without loans, financial aid or parents looting home equity or retirement accounts is within reach. Zac knows because that's what he's presently doing. 
 
Here's the math on going to college, according to "The College Board", public four-year colleges charge an average of $7,020 per year in tuition and fees, plus another $7,404 for room and board. That's a total of $14,424 per year. 
 
Most families qualify for a tax credit of $2500 on the first $4000 in college expenses. So after tax that $14,424 is really $11,924. If you break it down it's $229.31 per week. Then divide that in half makes it $115 for the child and $115 for the parents. Not bad seems manageable. Nearly all colleges allow you to pay monthly over the course of the semester. So you can really cash flow college. 
 
If the child works during the summer 40 hours plus and at least 20 hours a week during the school year at $8.00 per hour, it comes to $11,200 per year. 
 
34 weeks work 20 hours per week at $8.00/hour = $5440 
18 weeks work 40 hours per week at $8.00/hour = $5760 
 
According to Zac Bissonnette, junior will only need half of that total because Mom and Dad will pay the other half. So junior has plenty of money for other things. 
 
Included in this scenario is that it is assumed you start out with no savings. If Mom and Dad did save it would make it a little easier. It's assumed you received no financial aid or grants. According to the website knowhow2go.com 60% of students qualify for grant aid to the extent of $3,300 per year for four year public colleges and $1,800 for two year public colleges. That's a big help. Also assumed the student stays on campus, no private housing. 
 
The only problem with this plan is that it's a lot of work. With today's self indulgent society brainwashing you, are you willing to work hard to stay out of debt. 

5 Ways To Deal With Co-Workers From Hell

 
Here I am offering 5 tips to make it a little easier to get along with that pain in the @$$ at work. Don't waste energy having a breakdown on account of someone you can't stand. 
 
Dealing with Co-Workers Tip #1: Be prepared for Conflict 

If you have some in the organization who is difficult be prepared for a potential situation. If you don't you may react with anger or some useless childish behavior that will only make the situation worse. 
 
It may help to practice a potential argument in your head to get ready for the situation. Listen to what your saying to see if it comes across as immature or foolish. Also remember to not be wishy-washy, uphold your morals and values. Don't be arrogant but be self-confident. And by all means don't letthe person get under your skin , be ready for cheap shots. 


Your job is already quite stressful with deadlines and difficult bosses. Not getting along with co-workers makes your job ten times more difficult. You have no choice but to try and get along or just change jobs. 


Dealing with Co-Workers Tip #2: Don't fuel the fire. 

If tempted to retaliate, don't. People who cause tension and confrontation also thrive on it. They feel powerful with an exchange of harsh words. Don't get sucked in, you'll only look like the bad guy. Instead react in the opposite way they expect, be nice to them. It drives irrational people crazy. You'll either become friendly with them or drive them away. 
 
Dealing With Difficult Co-Workers Tip #3: Lend a Helping Hand 

It may not work in all situations but difficult people may be just a troubled person or someone with poor social skills. They end up making enemies instead of friends because they have money problems or marriage problems at home. This makes them an actual miserable person to be around. They may not be justified in mistreating you, but at least you know why they act the way they do. 
 
Dealing With Difficult Co-Workers Tip#4: Get a Third Party Involved. 
 
No matter how hard you try you may just not be able to get through to the person. This is when you get a neutral party to help. They can listen to both sides and try to find common ground. 
 
Dealing With Difficult Co-Workers Tip#5: Move On 
 
You tried your best and nothing worked. You will reach a point where it's not going to be resolved. If one of you doesn't move on your going to have to suck it up or quit. If this treatment by the person effects your productivity it could he considered grounds for termination. But before all this occurs be careful in examining your own behavior and if your doing the right things. Most of all don't ignore the situation it will only get worse. 

How to: Get Rid of Credit Card Debt For Good

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When you finally realize your in deep credit card debt is the time you know you need to do something, but what? What has caused you to wake up. Was it the worry and sleepless nights thinking your going to lose it all. 
 
Most American family's are in credit card debt to the tune of between $2000 and $8000. Short of winning the lottery or declaring bankruptcy, there are no short cuts to paying off your debt. But there are some ways to systematically and effectively get rid of your credit card debt. 
 
Getting out of debt on your own is possible, but it will take a little work. Step one is to stop charging more debt. This may be the hardest part of the process if your short of money and unorganized. It's time to take control. 
 
Next you must access where you financially. How much do you owe and to whom do you owe it to. Might as well throw in there all your debts like Doctor bills and personal loans. Make a list with name of debtor, balance, interest rate and minimum payment. 
 
To do this right you must also create a budget of all your income and expenses. It's time to cut back for a while in life style. I'm talking about maybe it's time to find some things to cut out of your life, but only during the time of this war on debt. Things like cable TV, eating out and other things determined by you. Remember the more money you free up, the more there will be, that can go to pay off debt. The equation is that the more income that goes to debt, the sooner you will be done. You could look into taking on more hours at work or getting a part time job so you will have more money to throw at your debts. 

                             Here's Help On  "How to Set Up A Budget"

 
Now that your organized and have the cash ready , let's attack the first debt. Remember that list you made with debts listed on it, let's get it out and determine who we will attack first. Let's find the debt with smallest balance. We are going to pay that debts minimum and as much money we can scrape together and send it to that account. You have reduced spending on other things and we are going to use that money to put on this debt. While we're doing this we keep making the minimum payment on all our other cards, no extra to those cards. We are focusing on the smallest debt only. When we are done with the smallest debt, we then go to the next smallest and attack that one with all the money we can throw at it. 
 
There are two strategy we are using here. First the focusing on the smallest balance first with everything we have. Why do we focus on the smallest balance? What if I have a balance that has a higher interest rate? You ignore it and stay with the smallest balance because you need to have some wins in this process. With some wins you feel like continuing, because you will eventually lose interest in the long process. Some wins keeps you motivated. It's like going on a diet. If you don't lose some weight you'll give up and quit. 
 
The second strategy is after completing the first balance you take all the payment from the first card and throw it on the second card. Then continue this till you pay off all your cards. You must have an intensity when doing this. It's a hard task that takes hard work. You will lose faith during this process so between the budget and focus, you will get it done. 
 
For all this to be worth it you must not use credit cards again. It's to easy to go back into debt and after all your hard work it would be a tragedy. You will continue to budget and live on less than you make. Saving for future bills and creating an emergency account for the rainy day that is sure to come. 

Whats Best Separate or Joint Accounts?

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I have had a lot of discussions about if you should have a separate or joint accounts after your married. Now, when your not married, I agree that you should keep separate bank accounts. Also separate investment accounts and separate credit card accounts. You shouldn't buy any assets together like cars. Also do not cosign a note on any purchase. This is all sensible because you never know if your going to stay together. 
 
What's different after you are married? From a relational point of view it is better to combine finances. If your young and newly wed what do you have to lose. On the first marriage you are all fresh and innocent about life and so is your spouse. There is no reason not to. What about if this is your second marriage and you have some assets to protect. Maybe you have children and you want to make sure your assets pass to them. I think it's right to keep you accounts separate. 
 
What's the plus side of combining? There will be less accounts to manage. Investments will be combined and make them easier to coordinate and plan. There is a relational aspect because you will have to talk to each other about your accounts. The act of planning and coordinating budgets, investments and paying bills together absolutely will bring you closer. Separate accounts makes this not necessary. 
 
But keeping separate accounts also has it's pluses. You have an autonomy that's important in today's culture. In the high percentage of divorce and break-ups, you have one less thing to fight about. In my personal life I have found that keeping separate accounts reduce the disagreements a lot. I spend and save differently than my wife. Many arguments have been avoided by separate accounts. In case of death, we both have life insurance and our accounts will transfer to the other. With this plan everything runs a lot smoother, for my circumstances, it works for us. Of course there is total transparency, this important in our relationship. 
 
In my first marriage we had combined accounts. At that time that was the way it was done. It worked out great for each of us. We were young and things were great. But now a days you want to play it safe. 
 
Many personal finance gurus say it's better to combine everything in marriage. I disagree because it's more important to do what works best for your particular situation. Don't just follow someones advice, do what's best for your situation.