Backdoor Taxes Loom Large

The Obama administration unveiled its 2011 budget, revealing that the president plans to trim more than one trillion dollars from the deficit over the next ten years. Unfortunately, those plans are being hatched on the back of middle-class taxpayers who may not know what has hit them until it is too late.

What You Should Know

President Obama is planning to spend an additional $1.7 trillion next year, pushing the deficit up by an additional $2 trillion. That will raise our national debt above $14 trillion (or is it $15 trillion?) making it even more difficult to service our nation’s debt in future years

• jump to our BLOG article on raising taxes
• view how to budget your money to avoid getting hit with unexpected tax payments

You Can Gain Control Over Your Electrical Bill

Consumers are reeling from the sudden shoot up in fuel prices at the pump, paying $4 or more per gallon for regular gasoline. Unfortunately, home energy prices are also going up, stinging homeowners with increases of !0-50% over the past year.

While you may be able to cut back on driving, you may not be able to do so with cooling your home, especially if you live in an area where high temperatures and stifling humidity reigns supreme all summer long.

There are ways you can reduce your energy consumption without being very uncomfortable this summer. Less energy burned means more money that will stay in your wallet, a good thing because you'll need those extra funds to pay for gas!

The following tips can help you gain control over your electrical usage this summer:

Replace your thermostat -- If you still have a manually operated thermostat, consider replacing it with an electronic one. By automatically setting the inside temperatures to go up and go down at strategic times of the day (like just before you come home from work), you'll be able to cool down the house without wasting electricity. Consider also getting your HVAC system tuned up for the hottest months of the year.

Close your blinds -- If any part of your home gets direct sunlight at certain times of the day, make sure your blinds are closed and your curtains drawn during those hours. Your air-conditioner won't need to kick on as quickly when the inside of your home remains cooler longer.

Run the dishwasher and clean clothes at night -- Many utility companies structure their rates to charge you more for using their services during peak hours. Hold off washing the dishes and running the dishwasher until the evening and you'll save a nice amount of money. Check with your electrical company to find out when the lowest rates apply.

Take control of your lighting -- Turn lights off when not needed and consider replacing bulbs with lower watt bulbs wherever possible. Also, incandescent lighting uses less energy than fluorescent lighting.

Take control of your water heater -- Especially in the summer months, you can lower the temperature of your water heater and still have it hot enough to sanitize dishes and get you clean. Wrap the unit in insulation and it won't have to work as hard to warm up your water.

Consider air drying your clothes -- Clothing dryers are a wonderful convenience, but if you can air dry at least some of your clothes, then you can use your dryer less and save electricity.

Microwave is the better way -- People who own a microwave and an electric oven can save money by choosing the microwave for cooking. If you can cook it in either oven, then put it in the microwave for quicker cooking and less strain on your electrical system.

Finally, if you are planning to buy new appliances this year, choose those with an Energy Star rating at the top end of the scale to reduce your energy consumption even further

2008/06/05 home tips

It is a given that most consumers carry at least one credit card, perhaps several when you include department stores, gas station cards, plus MasterCard, VISA, AmericanExpress, Discover and others. Consumer lending is a huge industry, one that lenders depend on to fuel their businesses.

Not all credit card offers are equal with some offering high rates and no rewards to others which will give you a low, fixed rate and shower you with special prizes. Before you choose your next card, let's take a look at the variety of credit card options out there for your consideration.

Low Interest Rate Credit Cards -- Despite the recent run up in interest rates, there are still credit cards available with low rates, even zero percent financing for balance transfers. Usually, these special rates are in place until the transfers are paid off with newer purchases charged at a higher rate.

Low Introductory Rate Credit Cards -- To get you to use a new card, some credit card providers will offer you a special "teaser rate" that will run for several months, usually for as long as six months. You can make purchases at the very low rate (let's say 1.9% for six months) and then pay 12.9% or more after that time. This can be a great way for consumers to make an expensive purchase they plan on paying off within a few months time.

Pre-paid Credit Cards -- For consumers with bad credit and for students who are off to college, a pre-paid credit card allows holders to build up their credit while still having the convenience of shopping with plastic. No worrying about carrying around a wad of cash -- if you lose the credit card you haven't lost your money.

Rebate Credit Cards -- Use your credit card and get paid for it! Sounds like a come on, but it is true: some credit card providers will give you cash rebates on select purchases. Spend $1000 and you could have $10 or $20 credited to your account, depending on the offer.

Award Credit Cards -- Also known as rewards cards, an award card works similarly to a rebate credit card: you get to select gifts based on points you have accumulated with your purchases. Typically, one point is awarded for every dollar spent and you can redeem those points online or through a catalog sent by the credit card company. Many award credit cards will automatically give you 500 or more points with your initial purchase and some will incentivize their offers through special promotions which can double or even triple your points during a special promotional period (for example, the Christmas shopping season).

The previously mentioned credit cards choices are typically MasterCard or VISA network credit cards, but American Express and Discover have special offers which might be of interest to you too. You can manage your various rebate cards with this free download to help you get the rebates and rewards coming to you.

2007/11/27 credit cards

If you’ve recently received a copy of your credit report from either Experian, Equifax, or TransUnion (the three major credit reporting agencies) you might be surprised by just how much information that they have about you. Trouble is, some of that information may not be correct. Should that be the case, then you need to take the appropriate action to correct your reports because if you don't, then wrong information could come back to haunt you the next time you seek to obtain credit, rent an apartment, even apply for a new job.

Credit Report Errors Can Harm You!

Mistakes found in your credit reports can work against you, possibly affecting your ability to obtain credit at an interest rate favorable to you. Left undiscovered, credit report errors can harm you by causing you to pay hundreds of dollars more each month on your mortgage or finding that your new auto loan application has been turned down. This shouldn't happen as each credit reporting agency -- Experian, Equifax, and TransUnion – must supply to you one free copy of your credit report on an annual basis upon request.

You can obtain your credit report copies at www.AnnualCreditReport.com, the website which has been approved by the Federal Trade Commission to process your request. Just to let you know, your all-important credit score is not included with the offering, but you can and should obtain that information too by paying a separate, token fee for the service.

How To Report Errors On Your Credit Report

Credit reporting agencies are required to repair errors on your credit report as per the Fair Credit Reporting Act. All the same, they will only take action if you inform them of the problem first. Be prepared to draft a letter to the respective credit bureau and send it to them by means of certified mail. That letter should include the following information:

• Your complete name, address, social security number, and your date of birth.
• The disputed company’s name and your account number with them.
• State your reason for the dispute, share your correct personal information, and ask that they amend your credit report consequently.

Mistake?  By Law, They Must Be Corrected Or Expunged

By law, the credit reporting agency will get rid of any disputed information that they cannot be verify, so make certain that you do a thorough job to corroborate everything correctly. Naturally, if you do have a track record of credit problems that information will remain on your credit report and it will reduce your credit score. Please keep in mind that if you filed for personal bankruptcy that information can stay on your report for as long as ten years.

In conclusion, don’t forget to obtain free copies of your credit reports from Experian, TransUnion, and Equifax, cautiously examining each one to look for mistakes.

2009/05/11 credit reports

If you own a home, one resolution to consider is this -- paying off your mortgage in 2010. Sure, not every homeowner can possibly consider taking this step, but if you have a small balance left on your mortgage, then paying it off sooner rather than later could save you thousands of dollars in interest payments.

Will 2010 be the year that you own your home debt free? It can be! Let's take a look at the Pros and Cons of paying off your mortgage this year.

Pros -- Why You Should Pay Off Your Mortgage

Peace of Mind -- You may not be in a position to have to worry about losing your home, but just owing money to a mortgage banker (no matter how small the outstanding balance) can be uncomfortable for you. If you have the means to pay off your mortgage, why not just go ahead and do it?

Contributing to Retirement -- Lots of people are house rich, but cash poor. Maybe you have another 10 to 15 years before retirement, but the funds to carry you during your golden years are rather limited. Instead of making mortgage payments, why not redirect your monthly contributions to your retirement fund?

Allows You To Take One Final Deduction -- Maybe in 2010, you'll need the I.R.S. mortgage deduction to help reduce your overall tax burden, but you won't be needing that deduction in 2011 (especially if your income will be dropping due to retirement). Making your final payments in 2010 will still allow you to take a deduction for 2010 taxes as you prepare for a drop in income for subsequent years.

Cons -- Why You May Want To Reconsider Paying Off Your Mortgage

Loss Of Tax Savings -- If you are in your peak earning years and getting hammered by the tax man, don't expect that the burden to get any lighter especially in this current political environment. With some congressional leaders promising to tax the rich, will the loss of tax savings due to paying off your mortgage cause you more harm than good in the long run?

Diverting Cash From Other Investments -- If paying off your mortgage now means diverting money from other investment choices, is that really a good option for you? Specifically, if paying off your mortgage means you cannot contribute to your 401(k) account, will the loss of company match and investment growth potential be worth it to you?

When seeking financing advice, you'll hear both sides of the issue, but the decision to paying off your mortgage in 2010 rests squarely with you. A personal windfall could also be weighing in on your decision, so consider speaking to an investment planner before you make this important decision.

2008/01/04 money management

How good is your homeowners' insurance policy? Has it been updated since you first took it out? Does it reflect the big surge in home prices over the past ten years?

Insurance can be one of those things you get and quickly forget about. Sure, annual premiums must still be paid, but if the rates haven't gone up all that much over the years, you may not notice just how much your insurance coverage you really have. Then again, if you live in a Gulf state, then you probably have seen your insurance costs double, triple, and even quadruple in a few short years.

Paying more for insurance doesn't necessarily mean that the insurance you have now covers all of your needs as it did back then. Your insurance company may have been tracking current housing conditions and adjusting your coverage accordingly, but you can't guarantee that they have or that their calculations reflect your home's value.

In addition, construction costs have skyrocketed and subtle changes in your policy may have changed some key provisions, specifically limiting the cap on the home's replacement value.

So, what is the solution? Answer: find your homeowners policy and check to see if it is adequate for your current needs. If it isn't, contact the insurance company to adjust your policy accordingly. Furthermore, if you aren't satisfied with the proposed modifications, start shopping around for a new policy.

2008/06/02